Constructive dismissal claims arise when an employee resigns because of sufficiently serious employer conduct. This guide explains the legal tests, evidence to preserve, and why resigning too quickly can weaken a good case.
A constructive dismissal is a resignation where an employee finds no choice but to resign. If a constructive dismissal occurs, the employee can later bring a personal grievance for unjustified dismissal.
A constructive dismissal is a resignation where the employee says they had no real choice but to resign because of the employer's actions. If it is truly a constructive dismissal, it can be treated as an unjustified dismissal personal grievance.
The classic NZ categories come from Woolworths. Constructive dismissal can occur where:
Where an employee resigns and claims constructive dismissal, the onus is on the employee to show that a dismissal has occurred in substance. That is why the "do not resign" advice is so important.
A common scenario is a disciplinary meeting or investigation where the employer is heading toward termination, then suggests the employee resign instead. Employees often think resignation "looks better", but legally it can destroy an unjustified dismissal claim because the end of employment can be treated as the employee's decision.
In many cases, the better approach is:
Constructive dismissal arguments often come up where there is a pattern of behaviour or a serious event that makes continued employment intolerable. Examples can include:
Personal grievances generally must be raised within 90 days of the relevant action or when it came to the employee's notice (whichever is later). With constructive dismissal, the timeline can become complicated (because it can involve a series of events), so delay can be fatal.
Constructive dismissal claims are evidence heavy. If you are considering resignation (or you have resigned), gather and preserve:
If you resign and later claim constructive dismissal, the resignation letter can become key evidence. If you intend to claim constructive dismissal, your letter should clearly record the reasons and complaints and the fact you previously raised concerns.
Your resignation letter (constructive dismissal style) should usually:
If a constructive dismissal is established, it is treated as a form of unjustified dismissal. Potential remedies can include reinstatement (where reasonable), reimbursement of lost wages, and compensation for hurt and humiliation. Outcomes depend on the facts and what happened after the resignation (including mitigation and job search).
Constructive dismissal risk is often created by poor process, unmanaged conflict, and sloppy communications. If you are managing a high conflict situation, get advice early and document your steps.
Employer advice and dispute defence
The fastest way is to submit the case form with a short timeline and key documents.
We will assess whether a constructive dismissal argument is realistic and what your best next step is.
Employee Case Form
Constructive dismissal claims arise when an employee resigns because of sufficiently serious employer conduct. This guide explains the legal tests, evidence to preserve, and why resigning too quickly can weaken a good case.
Two resignation-letter approaches are explained: an ordinary amicable resignation and a resignation that records the employer conduct relied on for a possible constructive-dismissal grievance.
![South Pole IP Holding (NZ) Limited v Hao [2026] NZEmpC 193 - constructive dismissal upheld](/Images/site/EmploymentAdvocatesAucklandCard.jpg)
South Pole maintained that Xinhua Hao had agreed to resign, pressured him to leave, stopped providing meaningful work and refused to engage with him about work matters. The Employment Court upheld the ERA's constructive-dismissal finding.
Employment Services pursued serious-misconduct allegations without adequately identifying them or providing requested information. Its unagreed visit to Frank Resink's home to recover a company vehicle became the last straw in continuing breaches of good faith.
Phil Jacklin argued that Planit Software Testing's short-term incentive clause guaranteed him a 25 percent bonus paid quarterly. The employer said the scheme was discretionary, while a separate issue concerned its failure to set KPIs and eligible amounts at the beginning of the financial year as promised.
Adarsh Chand resigned from Professional Stylish Barber Shop after disciplinary warnings and employment treatment he said had destroyed the relationship. The ERA examined whether the warning was substantively and procedurally justified and whether the resulting resignation was caused by the employer's breaches.
Courtney Jansen was told by an external HR consultant that BDS Chartered Accountants would end her employment under a 90-day trial, but was offered the option of resigning instead. The case turned on whether choosing resignation in the face of an announced dismissal was truly voluntary.
Courier driver Xiaoshuai Huang was bitten by a dog, went on ACC and was pressured to withdraw his ACC claim on the basis that Fast Horse said he was a contractor. After he refused, he was removed from the work messaging system and stopped receiving jobs.