Medium2 marksMultiple Choice
Corporate and Business LawSection ASyllabus CEmployment Law

ACCA · Question 10 · Corporate and Business Law

Global Aid Network, an NGO, recently changed the job description of its regional director, Sarah, without her consent. They removed her managerial responsibilities, relocated her desk to a windowless basement, and reduced her pay by 20%. Sarah resigns immediately in response. What type of dismissal has occurred?

Answer options:

A.

Wrongful dismissal

B.

Unfair dismissal

C.

Constructive dismissal

D.

Summary dismissal

How to approach this question

Identify the legal term for when an employee is forced to resign due to the employer's severe breach of contract.

Full Answer

C.Constructive dismissal✓ Correct
Constructive dismissal occurs under s.95(1)(c) of the Employment Rights Act 1996 when an employee terminates the contract (resigns) with or without notice, in circumstances where they are entitled to do so without notice by reason of the employer's conduct. The employer's actions (pay cut, demotion) constitute a fundamental breach of the implied term of mutual trust and confidence.

Common mistakes

Confusing constructive dismissal with wrongful dismissal (which is about notice periods).

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