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What is "constructive dismissal"

#yourquestionsanswered What does constructive dismissal look like in the workplace?

Hard working person

Constructive dismissal in New Zealand occurs when an employer's conduct or actions make it impossible or intolerable for an employee to continue working, leaving the employee feeling they have no option but to resign. If you feel like you can't possibly go to work tomorrow, you may have a case to say you're being constructively dismissed. This can also be described as being pushed out or forced out, or sometimes just being bullied.

What might this look like?
  1. Breach of Contract: The employer breaches the terms of the employment contract in a significant way, such as reducing pay or benefits without agreement, changing job duties without agreement, or subjecting the employee to harassment or discrimination. This might also look like not upholding their own policies.

  2. Unilateral Changes: The employer makes unilateral changes to the terms and conditions of employment without the employee's consent, which adversely affect the employee's working conditions. This might include a demotion, or change to pay rates or bonuses.

  3. Unsafe Work Environment: This doesn't necessarily just mean unsafe physically, but also can include a hostile, intimidating, or abusive work environment that makes it unbearable for the employee to continue working. If the employer fails to provide a safe workplace or address serious health and safety concerns, which results in the employee feeling compelled to resign.

  4. Not acting reasonably when an employee raises concerns: If you raise your concerns with your employer, either formally in writing or verbally, and they do not act reasonably, this can make the employment feel untenable.

  5. Ultimatums: If an employer tells you that you either can do something or resign, this may amount to constructive dismissal. For instance, they can go on a performance improvement plan (PIP) or resign.

If an employee believes they have been constructively dismissed, they may have grounds for a personal grievance claim under the Employment Relations Act 2000. To pursue such a claim, the employee typically must demonstrate that the actions or conduct of the employer amounted to a breach of the employment agreement or implied terms of employment, and that resignation was a reasonable response to the situation.

We always recommend that you seek advice before resigning if your employment becomes untenable. Generally this will strengthen any case you wish to raise.


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