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Bullied Employee Wins Constructive Dismissal

In the case of Williams v AWF Limited in the Employment Relations Authority recently, an employee told the branch manager and the general manager that her line manager was bullying her. Her managers understood she did not want the employer to take any action. The managers told the employee to contact them again if things escalated. The behaviour continued for another two months during which time the employee again raised the matter on three specific occasions. The employer did nothing and also claimed at the Authority there were no such meetings.

The employee could not tolerate the treatment any longer and raised a personal grievance based on bullying from the line manager and the failure of the employer to respond to her complaints when raised. She asked not to work with her line manager and wanted to discuss an exit strategy as she felt that was her only option.

The employer asked the employee to work from home for her own safety and investigated the claims. The claims were found to be true; the line manager was bullying the employee and the report concluded that the relationship was irreparable.

The employer proposed a return to work plan that included both parties ‘drawing a line in the sand and working together’, discipline and training for the line manager and facilitated meetings between the line manager and employee however the employee would still be reporting to the line manager. The employer was not able to provide much, if anything, by way of reassurance to the employee that she would not be bullied again.

The employee was concerned about the return to work plan especially continuing to work for her line manager. When the employee said she had concerns, the employer advised her that if she didn’t come back to work she would be placed on leave without pay and that she should return all the employer’s property to the office.

The employee resigned claiming unjustified disadvantage and unjustified dismissal.

Unjustified disadvantage:

Although the employee said she did not want anything done, the Authority found:

  • the employer’s own policy said any incident would be investigated: the policy did not say only formal, written complaints would be investigated and therefore irrespective of how the complaint was raised the employer should have investigated as soon as the employee raised her concerns,
  • that in some circumstances it is not ok for an employer to do nothing,
  • that victims are in a vulnerable position and unlikely to make good decisions and therefore doing nothing is not justifiable, and
  • that the employer had failed to provide a safe workplace for the employee by not taking reasonably practicable steps to protect her.


The employee claimed unjustified dismissal. The Authority said there was no sending away and therefore this was not unjustified dismissal. The Authority said it was constructive dismissal because there was a breach of duty by the employer that led the employee to resign.

The breach of duty was the return to work plan which forced the employee to work with the bully after the employer’s own investigation found the line manager had bullied the employee and the relationship irreparable. The employee had sought an exit strategy when she first raised the personal grievance about the bullying, therefore, the employer could have reasonably expected the employee to resign by subsequently forcing her to work with the bully. As such the Authority found the employee was constructively dismissed.

The employee was awarded $20,000 compensation for hurt and humiliation plus three months’ pay.

What are the lessons from this case?

Once an employer is told of a bullying situation, they cannot fail to act. While a formal investigation is not necessary in all circumstances, employers can begin taking small steps to manage the situation.

Clear directions should be given to the alleged bully, while taking care not to predetermine the truth of the allegations. The complainant should be told what has been done and what they can expect in the future. It would also be wise for employers to begin documenting what steps they are taking, and to check in periodically with the complainant.

Our consultants will be happy to guide you through a process designed to mitigate risk to your business.

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