Constructive dismissal: what it is, examples, and settlement

What is constructive dismissal?

Constructive dismissal is when you resign because of something your employer has done that is serious enough to count, in law, as a dismissal. Acas, whose guidance on it was last updated on 20 October 2026, describes it like this:

Two parts of that description carry the weight. Seriously breached is the threshold — the statute, quoted below, puts it as conduct that would entitle you to leave without notice. And one serious incident or a series of things means a run of smaller breaches can add up, as well as one event. Acas is also blunt that resigning is a big step and that a constructive dismissal claim can be difficult to win at a tribunal.

Examples of constructive dismissal

Acas suggests raising the problem informally first and then, if that fails, a formal grievance — which also creates the record a later claim depends on. How to raise a grievance.

Who can claim constructive dismissal

Acas says you usually need to be an employee and to have worked for your employer for 2 years. It lists situations where less service is enough because of the reason you resigned: pregnancy, childbirth or maternity leave, health and safety, whistleblowing, asserting your rights under the Working Time Regulations and asserting your right to the National Minimum Wage.

That threshold is about to fall. The Employment Rights Act 2025 cuts the qualifying period for ordinary unfair dismissal, which includes constructive dismissal, from two years to six months, and the commencement regulations apply it from 1 January 2027:

So someone with, say, ten months’ service whose employment ends on or after 1 January 2027 will have a claim that someone leaving in December would not. In Northern Ireland the period is one year. Northern Ireland.

Where a settlement agreement fits

That is the trade the rest of this page is about: the claim you would be giving up, and what it is worth to keep it in your hand until the terms are right.

What the statute actually says

The whole definition is one limb of one subsection, and it is worth reading rather than paraphrasing, because every word in it is doing work.

Three things have to be true, and the statute names all three

1. The employer’s conduct. Something they did or failed to do.
2. Conduct entitling you to terminate without notice. Not conduct that was unfair, or unpleasant, or badly handled — conduct serious enough to release you from the contract immediately.
3. You terminate the contract. With or without notice, but you have to go.

What this page will not tell you

How serious is serious enough. That question is answered by case law rather than by statute, and case law is not published on legislation.gov.uk. This site quotes primary sources and does not summarise judgments from memory, so the honest answer is that the threshold is high, it is fact-specific, and it is the single thing most worth putting in front of someone who can read your documents. Why we draw that line.

What we can say from the statute alone is that the bar is set by the words entitled to terminate it without notice — the same standard that would let you walk out of any contract on the spot. That is a demanding phrase, and it explains why so many strongly felt grievances do not become constructive dismissal claims.

Being dismissed is not the same as winning

Establish s.95(1)(c) and you have shown you were dismissed. You have not yet shown the dismissal was unfair. Those are two separate stages and the second one has its own statute.

The burden moves to the employer, then moves back

Note the structure. It is for the employer to show the reason and that it falls within one of the listed categories or is some other substantial reason. If they cannot, the dismissal is unfair. If they can, the tribunal then asks whether they acted reasonably in treating that reason as sufficient.

So a constructive dismissal claim can be lost at either stage, and the two failure modes look completely different from the inside. That is a large part of why these claims settle.

If you are currently off sick because of the treatment you would be resigning over, read what changes when you are off sick first — your illness may open a disability route that does not depend on resigning at all.

The rule for people already on notice

A common and expensive worry: I have been given notice and I cannot face working it. If I leave early, have I resigned?

What that means in practice

If the employer has given you notice and, within that notice period, you give shorter notice, you are still treated as dismissed — and the reason is taken to be the employer’s reason, not yours. Leaving early in that specific situation does not hand them a resignation.

It is worth being precise about the scope: this applies where the employer has already given notice. It is not a general licence to resign and call it a dismissal.

Why the negotiation is stronger before you resign

This is the practical heart of the page, and it runs against most people’s instinct.

You are holding something you have not spent

Before you resign, the employer faces an employee with a live grievance who might leave and claim. After you resign, they face a former employee who has already done the irreversible part. The second position is weaker, not stronger, and it is weaker precisely because the decision has been made.

The protected conversation may not protect them

There is a second asymmetry worth knowing. If your employer opens a settlement conversation relying on ERA 1996 s.111A, that protection only covers proceedings on a complaint under s.111 — ordinary unfair dismissal. Where discrimination or whistleblowing is also in the picture, they are back to the ordinary without-prejudice rule, which needs a genuine existing dispute. More on s.111A and the subsection that removes the protection where behaviour was improper.

And the queue is on your side of the table

Every offer is priced against what refusing would cost. In April to June 2026 the tribunal received 5,822 unfair dismissal complaints — the largest single category — disposed of 2,782, and ended the quarter with 22,336 still open.

HMCTS management information for April to June 2026, covering cases on the Reform case management system and single claims only. It is not official statistics and the figures are provisional. Constructive dismissal is counted within the unfair dismissal jurisdiction and is not reported separately. Source: Tribunals statistics quarterly: April to June 2026, published 10 September 2026.

Thinking about resigning?

Take advice before you do, not after. Send your postcode and the situation in a sentence. We pass an enquiry to a firm only with your agreement, and only to a firm entitled to receive it.

Your postcode Start my enquiry

The clock, and why there may be two of them

Six months, from termination not from the incident

Corrected 22 October 2026: this section and the answer below previously gave the pre-October limit of three months.

The period runs from the effective date of termination. In a constructive dismissal that is your resignation taking effect, not the conduct you are complaining about — which may have been months earlier. Acas early conciliation is compulsory before any claim and pauses the clock while it runs.

The extension test is narrower than people assume

A tribunal may allow longer only where it is satisfied that it was not reasonably practicable to claim in time. Compare that with the Equality Act, where the tribunal may allow such other period as it thinks just and equitable — a materially wider discretion.

If both are in play, the two limits can expire on different days. What else changes when discrimination is involved.

What the settlement is worth

The same arithmetic as anywhere else on this site: a fixed floor and a negotiated element. What a tribunal could award instead is set out, with a calculator, on the constructive dismissal compensation page.

The same diagram as a table

Worked example of a two-part settlement figure

Part	What it covers	Amount	Tax treatment
Part 1 — contractual	Notice pay, holiday pay, unpaid wages, bonus or commission	£8,600	Income tax and National Insurance in full
Part 2 — ex gratia	Statutory redundancy pay, compensation for loss of employment, injury to feelings	£15,000	First £30,000 free of tax and National Insurance
Total	—	£23,600	—

Threshold figure: Income Tax (Earnings and Pensions) Act 2003, s.403(1). Illustrative amounts.

The floor is smaller here than in a redundancy

In a constructive dismissal there is usually no statutory redundancy payment, because the dismissal is not a redundancy. What remains fixed is notice — and even that is contested terrain, because an employer disputing the constructive dismissal may also dispute that notice is owed at all.

The result is that a larger share of a constructive dismissal settlement is genuinely negotiated than in a redundancy, where much of the package is statutory entitlement wearing a bow.

What moves the negotiated part

What it would cost the employer to defend: legal fees they will mostly not recover even if they win, management time, disclosure, and the risk of a finding. A documented grievance, a process that looks decided in advance, and any discrimination element all raise that cost. The full list, and how to use it · run your own figures.

And the document still has to work

Whatever is agreed, the agreement only stops you claiming if all six conditions in s.203(3) are met. What the document contains, clause by clause · who pays for the advice it requires.

Common questions

What is constructive dismissal?

Resigning because your employer has seriously breached your employment contract, in circumstances that count as a dismissal in law. Section 95(1)(c) of the Employment Rights Act 1996 defines it as terminating the contract in circumstances in which you are entitled to terminate it without notice by reason of the employer's conduct.

What are examples of constructive dismissal?

Acas gives four: regularly not being paid the agreed amount without a good reason; being bullied or discriminated against; raising a grievance that the employer refuses to look into; and unreasonable changes to working patterns or place of work without agreement. It can be one serious incident or a series of things.

How long do I need to have worked to claim constructive dismissal?

Usually two years as an employee. Less is enough if the reason you resigned relates to pregnancy or maternity, health and safety, whistleblowing, or asserting working time or minimum wage rights. Where employment ends on or after 1 January 2027 the usual requirement falls to six months.

Can I get a settlement agreement for constructive dismissal?

Yes, and it is one of the commonest situations in which one is offered — usually after a grievance has been raised and before anyone resigns. The agreement buys your waiver of the claim; what it is worth depends on how strong that claim is and what defending it would cost.

Do I have to resign first?

For a constructive dismissal claim, yes. Section 95(1)(c) of the Employment Rights Act 1996 defines it as the employee terminating the contract in circumstances entitling them to do so without notice because of the employer's conduct. No resignation, no dismissal, no claim. That is precisely why negotiating before you resign is usually the stronger position — you still hold something you have not yet spent.

Is being constructively dismissed the same as winning?

No, and this is the most expensive misunderstanding in this area. Establishing that you were dismissed only gets you to the starting line. Section 98 then puts the burden on the employer to show a reason and that it was a potentially fair one, and the tribunal decides whether they acted reasonably. Both stages have to go your way.

I am already on notice. Can I leave early and still claim?

Section 95(2) covers this. If the employer has given you notice and you give shorter notice within that period, you are still treated as dismissed — and the reason for the dismissal is taken to be the employer's reason, not yours. Leaving early in that situation does not convert a dismissal into a resignation.

How long do I have?

Six months from the effective date of termination, under s.111(2), where that date is on or after 1 October 2026; three months where it was earlier. The extension is narrow: the tribunal may allow longer only where it was not reasonably practicable to claim in time. That is a tighter test than the 'just and equitable' discretion that applies to Equality Act claims, so a matter with both in it can have two different clocks running on the same facts.

Does the tribunal publish constructive dismissal figures separately?

No. In the MoJ and HMCTS quarterly statistics, constructive dismissal sits inside the unfair dismissal jurisdiction rather than being counted on its own, so there is no published national figure for it. We are not going to estimate one.

Should I raise a grievance first?

It is worth taking advice before deciding. A grievance creates a documented dispute, which matters both evidentially and for whether any settlement conversation is protected at all. It also gives the employer an opportunity to put the problem right, which can cut either way depending on what you want the outcome to be.

What if there is discrimination in it as well?

Then you have two claims with different rules, and the agreement has to settle both. A discrimination complaint needs a qualifying settlement agreement under s.147 of the Equality Act 2010, which is a different section from the one that settles unfair dismissal. It also has no qualifying service requirement and no statutory cap on compensation.

Sources cited on this page

1. Employment Rights Act 1996, s.95 — circumstances in which an employee is dismissed
2. Employment Rights Act 1996, s.98 — fairness of the dismissal
3. Employment Rights Act 1996, s.111 — complaints to an employment tribunal
4. Employment Rights Act 1996, s.203 — conditions for a valid settlement agreement
5. Employment Rights Act 1996, s.111A — pre-termination negotiations
6. Equality Act 2010, s.123 — time limits
7. Acas — Unfair dismissal
8. Acas — Constructive dismissal
9. Employment Rights Act 2025 (Commencement No. 4) Regulations 2026, SI 2026/559
10. GOV.UK — Employment tribunals
11. MoJ / HMCTS — Tribunals statistics quarterly: April to June 2026

Every figure above was read from the source it is attributed to on 19 September 2026. How we check this.