"I have no alternative but to resign" took immediate effect

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Constructive dismissal update: resignation was immediate

The Employment Appeal Tribunal (EAT) has confirmed that the date a resigning employee ceases to work may not be the same as the date on which their employment is taken to end for the purposes of calculating the effective date of termination in a constructive unfair dismissal claim.

This in turn could affect whether any claim is brought within the 3 month time limit.

The EAT ruled, when considering whether a claim for constructive dismissal was lodged out of time,  that the words "I have no alternative but to resign my position" are unambiguous and have the same meaning as if the employee had stated "I am resigning now".

Following various problems at work Mrs Hibbert hand delivered a letter, dated 29 June 2012, to her employer which stated, "I am of the view that there has been a fundamental breach of my employment contract by my employer and I have no alternative but to resign my position". The letter was received and read on that date by the employer.

Her employer replied on 3 July 2012 offering Mrs Hibbert five days to review her decision. On 9 July, Mrs Hibbert's solicitors wrote back setting out the reasons for her resignation. On 11 July Mrs Hibbert's employer confirmed that it accepted her resignation and that Mrs Hibbert was required to provide four weeks' notice. It confirmed that her last working day would therefore be 27 July 2012 and she was paid to the end of that period.

When Mrs Hibbert brought a constructive dismissal claim, initially the Judge held that the letter of 29 June 2012 started the process of Mrs Hibbert's resignation and that following the correspondence between the parties, the effective date of termination (EDT) was 27 July 2012. This meant that the claim had been lodged in time. The Judge's reasoning was that Mrs Hibbert's letter was unambiguous as to resignation but not as to the date on which termination should take effect.

On appeal, the EAT considered an old case (Sothern v Franks Charlesly & Co) in which the Court of Appeal held that the words "I am resigning" meant "I am resigning now" and that an employee who continues to work for a few weeks following this unambiguous statement is still deemed to have resigned on the date they made that statement.

The EAT compared the Hibbert case with the facts of Sothern and concluded that Mrs Hibbert's words of 29 June were also unambiguous.  Mrs Hibbert had taken legal advice and she had not made the decision in the heat of the moment, nor had she been pressurised into a decision by her employer.  Her letter of resignation was effective immediately.  The correspondence from the employer after 29 June and the fact that she was paid until 27 July had no legal effect on the effective date of termination.  Mrs Hibbert's claim was therefore out of time.

The case is a reminder to employers to consider carefully the wording of any resignation when considering what action should be taken in response.

Employee may have "whole host of reasons" for resigning

The EAT has also recently confirmed, in another constructive dismissal case, that an employer's fundamental breach of contract does not have to be an employee's main reason for resigning.  This has previously been established in case law but is worth remembering.

Ms Wright's employer had behaved in such a way that amounted to a fundamental breach of contract, but Ms Wright also had personal reasons for wanting to resign, as she had caring responsibilities for her partner who had recently suffered a stroke.

The EAT confirmed that the crucial question is whether the fundamental breach played a part in the dismissal.  Once a fundamental breach is established, even if an employee leaves for a whole host of reasons (including where he has another job to go to), he can claim constructive dismissal if the fundamental breach is one of the factors upon which he relies.  However, the part that the fundamental breach played in the resignation will be relevant when calculating the compensation award.

Cases: Secretary of State for Justice v Hibbert; Wright v North Ayrshire Council