Career management

Constructive dismissal: when a resignation counts as a dismissal

By James Graham, founder of jobtracker.co.nz and Calculate.co.nz · Last checked 29 September 2026

Constructive dismissal is when you resign but the law treats it as if your employer dismissed you, because their conduct left you no real choice. It is a type of unjustified dismissal, so you raise it as a personal grievance, usually within 90 days. It is hard to prove, so raise the problem in writing first, give your employer a chance to fix it, and keep records.

What constructive dismissal means

Normally a resignation is your decision, and it ends your employment on your terms. Constructive dismissal is the exception. Employment New Zealand describes it as a situation where the employer's behaviour makes it impossible for you to stay and you feel you have no choice but to resign. It does not have to be one event: several things the employer has done, or not done, can be serious enough when added together.

Because it counts as an unjustified dismissal, the same limits apply. You cannot raise it if you were on a valid 90-day trial period. Since 21 February 2026, you also cannot raise it if you earn $200,000 or more a year, unless you and your employer agreed in writing to opt back in. That income limit does not yet apply to someone dismissed before 21 February 2027 from the job they held before 21 February 2026, or from one they moved to in a restructure.

The situations the law recognises

Employment New Zealand sets out three situations where a resignation can count as a dismissal:

Resign or be dismissed. Your employer gives you a choice that is no real choice: accept a demotion or pay cut or leave, for example, or resign before they fire you.
Deliberate pressure to resign. Repeated unreasonable demands, removing your support, isolating or undermining you, or creating ongoing stress with the aim of forcing you out.
A serious breach that leaves no choice. The most common type. Examples include bullying or harassment that is not properly addressed, unsafe working conditions, being paid wrongly or late again and again, major changes to your hours, pay or duties without your agreement, and serious breaches of good faith.

In the third situation your employer's intentions do not matter. What matters is whether the breach left you no choice and was serious enough that your resignation could have been expected.

Why it is hard to prove, and what helps

A resignation because work was difficult or unpleasant is not, on its own, constructive dismissal. Employment New Zealand gives examples that do not count: a lawful and reasonable request outside your usual work, a fair performance process, work stress your employer was never told about, and resigning while your employer was trying to resolve the problem with you.

Deliberate pressure is harder to show, because you usually need evidence that it was aimed at making you leave. In every case the burden is on you to show you had no real choice, so records matter: what happened, what you raised, when, with whom, and what was done about it. Our article on how to document workplace issues covers dates, exact words, witnesses and keeping notes off work systems.

In jobtracker.co.nz, Your Career keeps 1:1 notes with the date, the person you met, what was agreed and any feedback given, so a pattern across months is written down as it happened. The demo shows two example 1:1 notes with a manager, with no account.

Before you resign: raise it first

Employment New Zealand's advice is to check what your employment agreement says about resolving problems, raise your concerns with your employer in writing, give them a reasonable chance to fix things, and keep records. If your employer could have fixed the problem but was never given the chance, the resignation may not be treated as constructive dismissal. If raising it is not safe or practical, resigning without doing so could be reasonable.

If your manager is the problem, you can raise it with another manager, HR, your union, a lawyer or an advocate. Free mediation through the Ministry of Business, Innovation and Employment (MBIE) is available while you are still employed.

"Dear [name], I am writing to raise a serious concern about [the issue]. On [dates], [what happened]. I raised this with [person] on [date], and it has not been resolved. It is affecting [my health, my pay, my ability to do my job]. I am asking you to [what you want done] by [a reasonable date]. I would like to meet to talk about it, and I am open to mediation. Regards, [your name]."

Take advice before you resign, not after: whether a claim is likely to succeed depends on the detail.

After you resign: the 90 days

A constructive dismissal claim is a personal grievance for unjustified dismissal, or for unjustified disadvantage (an unfair action that left you worse off) connected with the dismissal. It must be raised with your employer within 90 days of the action, or of when you learned of it if that is later; for a dismissal, Employment New Zealand counts the 90 days from the end of your employment. A grievance for sexual harassment has a longer limit, 12 months. Our article on how to raise a personal grievance covers what to put in the letter, mediation and the Employment Relations Authority.

Since 21 February 2026, if your own conduct contributed to the situation, the Authority or the Employment Court cannot give you your job back or award compensation (for hurt and humiliation, or for a lost benefit), and can reduce lost wages; if that conduct was serious misconduct, it cannot award anything. Employment New Zealand recommends getting legal advice before raising a grievance, and can help on 0800 20 90 20, as can Community Law, your union or an employment lawyer. Our guide to employment rights in New Zealand sets out the rest.

Keep the record while you are still there

Your Career at jobtracker.co.nz keeps your 1:1 notes, your wins and your pay record in your own account, with the words you write encrypted before they are stored, and never shared with an employer; create an account and choose the Career plan, and the first 7 days are free, with nothing charged if you cancel before then. If you would rather look around first, the demo opens a full job hunt and a year of Your Career, with no account.

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