Business manager's constructive dismissal claim fails over PIP process
A business manager with 8 years' service resigned after being invited to a second disciplinary hearing for underperformance. The tribunal found no breach of trust and confidence and dismissed his constructive unfair dismissal claim.
1 min read · Last updated 19 May 2026
Case details
Key facts
- The claimant was employed as a business manager from 1 March 2014.
- In February 2022, customer complaints and staff concerns about the claimant's attitude were raised.
- The claimant was placed on a performance improvement plan (PIP) in March 2022 due to underperformance.
- The claimant received a first written warning in May 2022 for failure to meet PIP targets.
- The claimant resigned on 6 October 2022 after being invited to a second disciplinary hearing.
- The tribunal found no breach of the implied term of trust and confidence by the respondent.
Timeline
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Employment started
Claimant started as sales executive at Nissan Halifax.
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Moved to Renault Bradford
Claimant became business manager at Renault Bradford dealership.
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Customer complaint
Female customer complained claimant was intimidating and pushy.
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Meeting with Mr Anderson
Mr Anderson raised concerns about claimant's attitude towards female staff and customers.
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Letter of concern
Claimant received a letter of concern, not formal disciplinary action.
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PIP started
Performance improvement plan put in place for claimant.
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First disciplinary hearing
Hearing regarding failure to meet PIP targets.
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First written warning
Claimant issued with first written warning.
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Invitation to second disciplinary
Claimant invited to second disciplinary hearing for continued underperformance.
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Resignation
Claimant resigned giving 4 weeks' notice.
The legal issue
The tribunal had to decide whether the employer's actions, including a performance improvement plan, disciplinary warnings, and a grievance response, breached the implied duty of trust and confidence, entitling the employee to resign and claim constructive dismissal.
The outcome
The tribunal ruled that the claimant was not constructively dismissed. It found that the employer's actions were reasonable and proportionate responses to performance concerns and customer complaints.
Key reasons:
- The performance improvement plan and warnings were justified given the claimant's underperformance.
- The grievance process was handled appropriately, and there was no evidence of bullying or lack of support.
- The invitation to a second disciplinary hearing was not a 'last straw' that breached trust and confidence.
No compensation was awarded as the claim failed.
Lessons & takeaways
- Constructive dismissal requires a fundamental breach of contract by the employer; dissatisfaction with performance management is not enough.
- Employers can use performance improvement plans and disciplinary processes without breaching trust and confidence, provided they act reasonably.
- Resigning in response to a disciplinary invitation is risky unless there is clear evidence of a fundamental breach.
- A grievance process that addresses concerns fairly can help employers defend against constructive dismissal claims.
This case shows that not every unhappy resignation amounts to constructive dismissal. The business manager, who had worked for the company for over eight years, felt singled out and unsupported after customer complaints and staff concerns about his attitude. He was placed on a performance improvement plan (PIP) and received a first written warning for failing to meet targets. When he was invited to a second disciplinary hearing, he resigned, arguing that the employer's conduct had destroyed trust and confidence.
What the tribunal decided
The tribunal carefully examined each of the claimant's complaints, including being accused of having issues with women, being bullied, and being ignored. It found that the employer's actions were reasonable responses to genuine performance and conduct issues. The PIP and warnings were proportionate, and the grievance process was handled fairly. The invitation to a second disciplinary hearing was not a 'last straw' that fundamentally breached the contract.
What the employer did right
The employer had a clear performance management process in place. It raised concerns with the claimant, gave him a chance to improve through a PIP, and followed its disciplinary procedure. When the claimant raised a grievance, it was investigated and responded to. The tribunal noted that the employer had supported the claimant in the past, including helping him progress to a business manager role.
Why this matters
For employees considering a constructive dismissal claim, this case is a reminder that the bar is high. A fundamental breach of contract—such as a serious failure to support or a disproportionate disciplinary response—is required. Simply disagreeing with performance management or feeling pressured is unlikely to succeed. Employers, meanwhile, can take comfort that reasonable performance management, even if it leads to resignation, does not automatically create liability.
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