Employment Law – Constructive Dismissal – Employment Lawyer - Business Lawyer

February 2020

This Blog isn't legal advice – if you need legal advice on any employment law issue, please contact me. I'm business lawyer (commercial lawyer) in Auckland who provides advice on a wide range of business law including employment law issues.

There’ve been a number of recent cases where disgruntled employees who have resigned have argued unsuccessfully that they’ve been constructively dismissed.

The fact that the arguments were unsuccessful illustrates that it’s a reasonably heavy onus to prove constructive dismissal. On the other hand, employers need to be cautious in how they deal with employees because it can be easy to create a situation where an employee could successfully argue that they’ve been constructively dismissed.

Examples of such situations include:

  • advising, suggesting or requesting that an employee should look for another job or resign (it being expressly stated or implied that the alternative is dismissal);
  • deliberately following a course of conduct to persuade the employee to resign;
  • treating the employee in such a way, in breach of the employer’s obligations, that the employee couldn’t realistically be expected to remain in employment under those circumstances (the breach must be sufficiently serious to make it reasonably foreseeable there's a substantial risk of resignation).

As to a breach of duty, there are a wide range of possibilities. For example, putting an employee under unreasonable stress and not being prepared to deal with this in a reasonable manner might be a breach of the employer’s duty of good faith, the duty to act fairly and reasonably, and the duty to provide a safe working environment. Placing unreasonable demands on an employee e.g. working hours, additional duties, etc, and not being prepared to be reasonable about this may be a breach of good faith, a breach of the duty to act fairly and reasonably, and possibly a breach of the employment agreement itself.

An important point is that the conduct complained of must be a key factor in the employee’s decision to resign. Sometimes, that simply isn’t the case.

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2 Enfield Street, Mt Eden, Auckland 1024. PO Box 946, Shortland Street, Auckland 1140.
Telephone: +64 9 379 4556 Mobile: 021 404 306. Fax: +64 9 379 4557 Email: steve@dukesons.co.nz