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Constructive dismissal explained

Constructive dismissal explained

Understanding constructive dismissal is important if employees want to assert their rights in their respective industries. Take a look at some of the steps in dealing with constructive dismissal.

Constructive dismissal, or more popularly known as forced resignation, can be easily misunderstood by employees as its conditions vary depending on an employee’s situation and their apparent relationship with their employer.

But in its simplest form, Australian employee labour laws define constructive dismissal as an event wherein an employee files for resignation as a response to the poor conduct manifested by their employer. Constructive dismissal also applies if an employee leaves due to their employer ending the employee’s position.

How can I identify if a dismissal is constructive?

Before filing for a constructive dismissal settlement, employees must first be able to prove that a constructive dismissal had occurred and that their employer’s conduct forced them to file for a resignation. In addition, employees must also prove that they would have remained in their position had it not been for their employer’s actions.

Constructive dismissal can be seen in the following situations:

  • The employer makes it particularly difficult for the employee to fulfill the tasks required for their position;
  • The employer refuses and/or fails to provide a safe and secure working environment for their employees;
  • The employer violates some if not all of the provisions in the employee’s contract, such as a sudden shift in working hours, unauthorised pay-cuts, demotions, relocation and failing to give proper sanctions to a co-worker who may have violated the employee in question;
  • The employer refuses to properly pay the employee’s superannuations and salaries;
  • The employer threatens the employee with dismissal, forcing the employee to resign instead; and
  • The employer refuses to grant flexible working hours to the employee despite it being included in the employment contract.

I am a victim of constructive dismissal. What should I do?

Once an employee determines that they are indeed a victim of constructive dismissal after resigning, they can use their constructive dismissal claim to reinforce their case for an unfair dismissal. An unfair dismissal claim can be made by applying to the Fair Work Commission within 21 days of the constructive dismissal notice period.

The Fair Work Commission considers the following when  determining whether or not an employee’s dismissal qualifies under unfair dismissal:

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  • If the employer prohibited the employee from having any supporting party in any of the discussions leading to the said dismissal;
  • If the employee received any warning before the implementation of the said dismissal;
  • If there was HR management intervention prior to the dismissal;
  • If there was a valid reason for the employer to dismiss the employee and whether the employee was given notice;
  • If the employee was given an opportunity to respond or otherwise; and
  • If the size of the business has an impact on the dismissal of the said employee.

When does a constructive dismissal qualify as a non-genuine redundancy?

A constructive dismissal qualifies as a non-genuine redundancy if it satisfies the following:

  • The employer has given the employee’s previous position to another person;
  • The employer failed to properly consult the said redundancy with the employee under a registered agreement; and
  • There is evidence that the employer could have instead given the employee another job within the business or within any of its associated businesses if any.

However, if the employee has been employed by a small business with less than 15 employees, the above-mentioned qualifications does not apply.

The employee must prove and determine whether or not their constructive dismissal satisfies the provisions indicated in the Small Business Fair Dismissal Code:

  • The employee was not given any concrete reason for their dismissal;
  • The employee has not received any notice prior to their dismissal and was not given the opportunity to respond to the notice;
  • The employee was not given any avenues for improvement to avoid being dismissed; and
  • The employer has failed to inform the employee that they are allowed to have a supporting party during dismissal-related discussions.

If an employee is still uncertain whether their case falls under constructive dismissal, they are encouraged to seek the help of a legal professional who has a good understanding of Australian employment rules and regulations.

Constructive dismissal explained
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