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EMPLOYERS NEED TO BE AWARE OF THE CONCEPT OF CONSTRUCTIVE DISCHARGE

September 4, 2018

Dealing with problem employees is never easy. It may seem like a lot of work for supervisors and HR managers to track a performance deficiency, issue a performance deficiency notice, and remind the employee that further performance deficiencies will result in more severe consequences.  It can be a slow, frustrating, labor-intensive process. It may seem much easier to simply do a “freeze-out”, i.e., reduce the employee’s workload, cut her compensation and let her know that, essentially, she is not valued and should feel free to leave the company.   The thinking is, if she resigns, she can’t sue the company because she hasn’t suffered an adverse personnel action. Right? We all know that an employee who quits her job can’t collect unemployment compensation for just that reason.

Unfortunately, it’s just not that simple.  While it generally is true that an employee who resigns cannot sue the employer for wrongful discharge or employment discrimination, there is an exception to that rule. The doctrine known as “constructive discharge” allows an employee who resigns from a job to bring a lawsuit if she can show that the employer made the working conditions “so intolerable that no reasonable employee could have tolerated them.” The range of conditions fitting this description is broad, and can include sexually inappropriate workplace conduct, racial or gender-based mistreatment, or a significant change in compensation.

Courts are not hospitable to constructive discharge claims, however, because virtually any employee can make some grievance about the job that allegedly forced the resignation.  Many bosses are rude, abrupt and demanding. But those traits do not necessarily amount to the level of mistreatment required for a constructive discharge claim.  Most courts also require an employee to try to address their workplace complaints before they reassign, to allow the company to try to resolve the issues.

To prevent constructive discharge claims as well as reduce employment litigation claims in general, the company should have written policies addressing workplace standards and requiring employees to promptly raise and present to management any complaints about mistreatment, discrimination or abuse. And employers should resist any shortcuts in documenting and managing employment performance issues in the hope that the problem employee will simply slip away on her own. It’s always better to have a written record demonstrating what took place to defend litigation if it is brought or -- even better - - to prevent it in the first place.         

If you have any questions about any employment matter, please give the employment attorneys at Zarwin Baum, David McComb, Zachary Silverstein or Dylan Henry a call at 215-569-2800. 


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