What is constructive dismissal?

Constructive dismissal is the legal term for when an employee resigns from their job due to intolerable working conditions created by their employer. It is a situation in which the employer has made changes to an employee’s work environment or contract that the employee cannot reasonably be expected to agree to or accept – essentially forcing the employee out.

Constructive dismissal cases can be complex and challenging to prove. However, if you have been subjected to a hostile work environment, harassment, discrimination, or other forms of mistreatment, you may have a case for constructive dismissal. It is important to seek legal advice as soon as possible if you believe you have been constructively dismissed.

Behaviours that constitute constructive dismissal

Some examples of constructive dismissal include:

• Demotion or reduction in pay. When an employee is demoted or has their pay reduced without a valid reason, this can be considered constructive dismissal.
• Unreasonable changes to working hours or conditions. If an employer makes unreasonable changes to an employee’s working hours or conditions, such as requiring them to work longer hours or in a more dangerous environment, this can also be considered constructive dismissal.
• Harassment or bullying. If an employee is subjected to harassment or bullying by their employer or co-workers, this can also be considered constructive dismissal.
• Hostile work environment. If an employee is working in a hostile work environment, such as one that is discriminatory or racist, this can also be considered constructive dismissal.
• Threats of dismissal. If an employer threatens to dismiss an employee, even if they do not follow through on the threat, this can also be considered constructive dismissal.

What to do

It is important to note that not all of these examples will necessarily constitute constructive dismissal. The specific facts of each case will need to be considered.

If you believe that you have been forced to resign, seek legal advice. In our Find A Lawyer tool you can search for someone who specialises in employment law and who can provide advice on your situation and discuss the steps you can take to protect your rights.

Read case examples of constructive dismissal on the Fair Work Commission website, and for more information visit the Work Rights Australia website.