In a recent decision, the Employment Relations Authority considered the application of an employee who claimed that she had been constructively dismissed by her employer.

A constructive dismissal is a situation where an employee appears to have resigned but, in fact, the resignation has been forced or initiated by an action of the employer.  There are three generally-recognised situations in which a constructive dismissal may occur:

  1. Where the employee is given a choice of resignation or dismissal;
  2. Where the employer has followed a deliberate course of action with the dominant purpose of encouraging the employee to resign; and
  3. Where a breach of duty by the employer leads the employee to resign.

In this case, the employee had resigned during a disciplinary process because she felt ‘targeted’ by the employer.  She then claimed a personal grievance for unjustified constructive dismissal against the employer.

The ERA found that the employer had followed a proper process, including amongst other things: informing the employee of the allegations; providing the employee an informed opportunity to respond; and making a decision free from bias and pre-determination.

The ERA found this to mean that there had been no breach by the employer of its obligations towards the employee in respect of the disciplinary process and there had therefore been no constructive dismissal.

This decision highlights the importance of a well-managed and proper disciplinary process: the alternative being the risk of large payments for lost wages, compensation, fines and costs.

If you need assistance with a disciplinary process, feel free to call us for a confidential initial chat.