Sales executive who resigned over pay plan changes loses constructive dismissal claim
A sales executive with four years' service who resigned after a new commission structure was introduced has lost his constructive unfair dismissal claim. The tribunal found no fundamental breach of contract.
1 min read · Last updated 18 May 2026
Case details
- #constructive-dismissal
- #pay-plan-change
- #commission-clawback
- #holiday-pay-calculation
- #ford-pass-app
- #grievance-handling
- #furlough-pay
Key facts
- The claimant resigned on 7 March 2022 due to dissatisfaction with the 2022 pay plan.
- The respondent changed the commission payment system in 2021 to pay commission in advance with clawback provisions.
- The claimant was given incorrect information about clawback but it was corrected during his grievance meeting.
- The claimant's holiday pay was calculated using a 260-day working year, which the tribunal found lawful.
- The claimant had been activating the Ford Pass app on his own phone for customers, knowing it was morally wrong, for over three years.
- The claimant's 2020 grievance about covert filming was fairly handled and he did not appeal.
Timeline
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Employment started
Claimant began working as a sales executive for Ford Retail Ltd.
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Ford Pass app introduced
The respondent introduced the Ford Pass app; sales executives were required to encourage customers to activate it.
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Grievance about covert filming
Claimant submitted a grievance alleging he was covertly filmed by manager Mr Kitson.
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Furlough due to Covid-19
Claimant was placed on furlough; he queried the rate of pay in April and May 2020.
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Grievance dismissed
The respondent dismissed the claimant's grievance about covert filming; claimant did not appeal.
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Furlough pay corrected
The respondent resolved the claimant's furlough pay query in his favour.
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Commission payment changed
Respondent introduced advance commission with clawback provisions.
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New pay plan effective
A new pay plan with higher basic salary but lower commission came into effect.
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Claimant queried pay plan
Claimant emailed HR about clawback and the new pay plan; received incorrect information from managers.
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Claimant resigned
Claimant resigned by letter without stating a reason.
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Grievance submitted
Claimant submitted a grievance about notice period, clawback, and holiday pay.
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Grievance meeting
Meeting with Mr Rafferty; incorrect information corrected; claimant declined to withdraw resignation.
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Employment ended
Claimant's contract ended; he was paid notice pay.
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Claim presented to tribunal
Claimant presented claims of constructive unfair dismissal, unpaid holiday pay, notice pay, and unauthorised deductions.
The legal issue
The tribunal had to decide whether the employer's actions—changing the commission scheme, handling grievances, calculating holiday pay, and administering the Ford Pass app—amounted to a fundamental breach of contract that entitled the employee to resign and claim constructive dismissal.
The outcome
The tribunal dismissed all claims: constructive unfair dismissal, failure to pay holiday pay, failure to pay notice pay, and unauthorised deduction from wages.
The key reasons were:
- The change to the commission scheme was permitted under the contract's bonus variation clause.
- The claimant's grievance about covert filming was fairly handled, and he did not appeal.
- Holiday pay was calculated correctly using a 260-day working year.
- The claimant had knowingly activated the Ford Pass app on his own phone for customers, which undermined his complaint.
- The claimant continued to work after the alleged breaches, affirming the contract.
No compensation was awarded as all claims failed.
Lessons & takeaways
- If you resign and later claim constructive dismissal, you must show a fundamental breach of contract—not just dissatisfaction with changes to pay or conditions.
- Continuing to work after learning of a breach can be seen as accepting the situation, which may defeat a constructive dismissal claim.
- Employers can change bonus schemes if the contract gives them discretion, but they must communicate changes clearly and correct any misinformation promptly.
- Holiday pay calculations based on a 260-day working year are lawful if they reflect the employee's normal working pattern.
- Raising a grievance after resigning does not retroactively create a constructive dismissal claim—the resignation must be triggered by the breach.
This case shows the limits of constructive dismissal claims when an employee resigns over changes to pay and conditions. The sales executive had four years' service and was unhappy with a new commission structure that increased basic salary but reduced commission. He also raised concerns about holiday pay calculations and a previous grievance about covert filming.
What the tribunal considered
The tribunal examined each alleged breach carefully. The contract allowed the employer to vary bonus schemes at its discretion, so the change to commission was lawful. The holiday pay calculation was correct under the Working Time Regulations. The earlier grievance about covert filming had been properly handled, and the employee had not appealed. Most significantly, the employee had continued to work for months after the commission change and only resigned after receiving incorrect information about clawback—which was corrected at a grievance meeting.
Why the claim failed
The tribunal found that the employee had affirmed the contract by continuing to work after the alleged breaches, and that the employer's conduct did not amount to a fundamental breach. The employee also admitted to activating the Ford Pass app on his own phone for customers, knowing it was morally wrong, which undermined his credibility. The employer's prompt correction of the incorrect clawback information showed good faith.
What this means for similar claims
Employees considering a constructive dismissal claim should act quickly after an alleged breach and not continue working for an extended period. They should also ensure that any changes to pay or conditions are not permitted by their contract. Employers should communicate changes clearly, correct any misinformation promptly, and handle grievances fairly. This case reinforces that constructive dismissal is a high bar to meet, especially when the contract gives the employer discretion to vary terms.
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