Constructive Dismissal

What is constructive dismissal?

Constructive dismissal describes situations where an employer has not directly terminated an employee but has unilaterally breached a major term of the employment contract or made clear their intention to do so such that the employment relationship cannot continue. The breach must be both substantial and against the employee’s interests. Because of the employer’s substantial breach of contract terms, the employee has no reasonable choice but to resign. True resignation must be voluntary. If an employee has no choice but to resign in situations of constructive dismissal, they have effectively been terminated.

An unavoidable part of the employment lifecycle is termination. When someone gets hired, no one expects termination; however, it is a reality that is bound to happen. Terminating an employee can be a stressful part of Human Resources. It can open the possibility of legal situations and other risks. Despite the best intentions for amicable terminations, they should be carried out fairly and according to legislation. Something as simple as a poorly written termination letter can expose an employer to many risks if not done correctly.

If you need assistance with terminations, see our blog, How to Write a Termination Letter (With Samples), for tips from our HR experts. You’ll see sample letters for both for cause and not for cause terminations to help guide your organization through the termination process.