Constructive dismissal arises when you as employer commit a 'fundamental breach' of the contract of employment - so fundamental that it looks as though you no longer intend to be bound by an essential part of it. Such a breach entitles the employee to resign. It might arise, for example, if you cut an employee's pay, or made it very obvious that you were demoting or undermining a manager, or appointed someone to work in one place and then unilaterally demanded that they move to another. In one case, an employer whose grievance procedures effectively stopped an employee from raising a grievance (because it required a meeting with the very line manager who was the subject of her grievance) was held to be in breach of its duty of trust and confidence to the employee and she successfully claimed constructive dismissal.
A change of function would not necessarily imply a fundamental breach in the employment contract, particularly if you had exhausted all other avenues in trying to help the employee improve their performance. Much would depend on the facts.
Any employee who now makes a complaint about constructive unfair dismissal to an Employment Tribunal is likely to have it blocked, unless he (or she) has first raised the matter, in writing, as a grievance, and then waited at least 28 days for you to respond. If you fail to respond to the grievance, the claim may proceed, and any award against you may be increased by between 10 and 50%. Be warned: Employment Appeals Tribunal (EAT) rulings have taken a liberal approach to the definition of a grievance, so that it might, for instance, include a letter of resignation setting out the problem, a solicitor's letter on the employee's behalf, or even a manager's typed-up and circulated record of a meeting at which an employee raised grievances. The employee is not required to follow the employer's grievance procedure, and the word 'grievance' need not necessarily even be mentioned.
Be warned also that this fluidity in the definition of a grievance works the other way too. The EAT decided in another recent case that an employee's launch of a grievance, once she knew the grounds on which she was being made redundant, constituted a valid appeal against dismissal, and that she was therefore entitled to the three-month extension of time in bringing a claim for unfair dismissal (because she had reasonable grounds for believing the dismissal procedure was being followed), even though she had missed the seven-day deadline for filing an appeal.
