Constructive dismissal over unresolved holiday pay: ACAS failed to clarify entitlement for 9 years
A Grade 10 Conciliator with 9 years' service won her constructive unfair dismissal claim after ACAS repeatedly failed to clarify her holiday entitlement, leading to her resignation. The tribunal awarded £24,847.58.
1 min read · Last updated 18 May 2026
Case details
Key facts
- The claimant started work for ACAS on 1 May 2013 as a Grade 10 Helpline Advisor.
- No written contract was ever concluded after April 2014, and the claimant's holiday entitlement was never properly recorded.
- The respondent's payroll system (iTrent) could not correctly record the claimant's part-time, term-time working pattern.
- The claimant repeatedly asked for clarification of her holiday entitlement from 2018 onwards, but the respondent failed to provide a final answer before her resignation.
- The claimant resigned on 10 February 2022 after a conversation with her manager confirmed the matter was still unresolved.
- After the claimant's resignation, the respondent calculated that she had been underpaid holiday pay by £9,625.67 and paid this sum on 31 May 2022.
Timeline
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Claimant started work
Claimant commenced employment as a Grade 10 Helpline Advisor on a fixed-term contract.
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Fixed-term contract expired
The fixed-term contract expired and no new written contract was ever concluded.
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Draft contract refused
The respondent sent an amended draft contract; the claimant refused to sign it, citing a reduction in annual leave.
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Leave records lost
The claimant and her manager discovered that no leave records could be found; claimant began reconstructing them manually.
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First resignation threat
Claimant emailed respondent stating ongoing holiday pay issues left her no option but to resign.
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First resignation
Claimant formally resigned but retracted it the next day after her manager assured her the issue would be resolved by early January 2022.
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Draft settlement letter
Manager sent draft letter stating accrued holiday of 122.43 hours and ongoing entitlement of 133.64 hours per year, but payroll simultaneously requested further information.
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Last straw conversation
Claimant spoke with manager who could not confirm that all concerns had been properly investigated, indicating the matter was still unresolved.
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Final resignation
Claimant sent resignation email citing unfair treatment and breach of contract.
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Employment ended
Claimant's last day of employment.
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Payment of £9,625.67
Respondent paid claimant £9,625.67 for underpaid holiday, excluding the Queen's Birthday entitlement.
The legal issue
The tribunal had to decide whether the respondent's persistent failure to clarify the claimant's holiday entitlement and to keep proper records amounted to a repudiatory breach of the implied term of trust and confidence, entitling the claimant to resign and claim constructive unfair dismissal, and whether the claimant was entitled to holiday pay including the Queen's Birthday privilege day.
The outcome
The tribunal upheld the claimant's claim for constructive unfair dismissal and holiday pay.
- The respondent's failure to clarify holiday entitlement over several years was a fundamental breach of the implied term of trust and confidence.
- The claimant's resignation in response to that breach was reasonable.
- Compensation: £24,847.58 total, comprising:
- Basic award: £4,708.08
- Compensatory award: £18,047.89
- Holiday pay: £522.24 (for the Queen's Birthday privilege day)
- ACAS Code uplift of 25% applied to the compensatory award for the respondent's failure to follow the ACAS Code of Practice on disciplinary and grievance procedures.
Lessons & takeaways
- Employers must ensure that written contracts are provided and holiday entitlements are clearly recorded, especially for part-time or term-time workers.
- Persistent failure to resolve a contractual query can amount to a breach of trust and confidence, potentially giving rise to a constructive dismissal claim.
- Resigning after a final conversation that confirms the issue remains unresolved can be a valid 'last straw' for a constructive dismissal claim.
- Employers should keep accurate records of holiday taken and accrued; failure to do so may lead to claims for unpaid holiday pay on termination.
- An ACAS Code uplift of up to 25% may be applied if the employer unreasonably fails to follow the ACAS Code of Practice on grievance procedures.
Background
This case highlights the risks employers face when they fail to clarify and record an employee's holiday entitlement, particularly for part-time or term-time workers. The claimant, a Grade 10 Conciliator with nine years' service at ACAS, had no written contract after April 2014 and repeatedly asked for clarification of her holiday entitlement from 2018 onwards. Despite assurances, the matter remained unresolved, and after a final conversation with her manager in February 2022, she resigned.
What went wrong
ACAS's payroll system could not correctly record the claimant's part-time, term-time working pattern, and no proper written contract was ever concluded. The tribunal found that the respondent's persistent failure to provide a final answer on holiday entitlement and to keep proper records amounted to a repudiatory breach of the implied term of trust and confidence. The 'last straw' was a telephone conversation with her manager on 9 February 2022, where the manager could not confirm that all concerns had been properly investigated.
The tribunal's decision
The tribunal upheld the claim for constructive unfair dismissal and also awarded holiday pay for the Queen's Birthday privilege day, which the respondent had argued was a 'use it or lose it' entitlement. The compensation included a 25% uplift under the ACAS Code of Practice because the respondent had failed to follow proper grievance procedures. The total award was £24,847.58.
Lessons for employers and employees
This case serves as a reminder that employers must take steps to clarify contractual terms, especially where systems are inadequate. For employees, it shows that persistent failure to resolve a contractual issue can justify resignation and a constructive dismissal claim, provided the final straw is sufficiently serious.
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