California Employment Law: What is constructive discharge/termination at workplace?

Constructive discharge occurs when an employer engages in conduct that effectively forces the employee to resign or retire. Although the employee may say “I quit,” the employer relationship is actually terminated by the employer’s acts against the employee’s will. As a result, constructive discharge is legally considered the same action as a firing by the employer rather than voluntary resignation or retirement by the employee.

To establish a constructive discharge claim, an employee must prove that the employer either intentionally created or knowingly permitted working conditions that were so intolerable or aggravated that a reasonable employer would realize that a reasonable person in the employee’s position would be compelled to resign. In determining whether a reasonable employee would feel compelled to resign, courts consider such factors as demotion, reduction in salary, reduction in job responsibilities, reassignment to degrading work, badgering, harassment or humiliation by the employer intended to encourage the employee to resign, offers of early retirement or continued employment on terms less favorable than the employee’s former status.  The employee must further notify someone in a position of authority of intolerable conditions before he may prevail on a constructive discharge claim. Such notice prevents employers from closing their eyes to wrongdoing and permits employers who are unaware of any wrongdoing to correct a potentially destructive situation.

It is important to remember that this standard is objective, and employee’s subjective feeling of disappointment is not enough to claim constructive discharge. An employee is not permitted to quit and sue simply because he doesn’t like something at his workplace.

So, which working conditions are considered “intolerable” and thus grounds to claim constructive discharge? Intolerable working conditions are those which either are unusually aggravated or amount to a continuous pattern of objectionable conduct. For instance, continuous course of harassment, uncorrected by management, can constitute objectively intolerable working conditions.

Normally, a single or isolated acts are generally insufficient to support a constructive discharge claim. But in some cases, even a single incident may be held to be “aggravated” misconduct by the employer; e.g., a crime of violence against the employee, or an ultimatum that the employee commit a crime.

The following conditions have been found to be “intolerable:”

continued harassment of an employee due to his sexual orientation (repeated gay jokes and other remarks);
a supervisor’s continuous “yelling and screaming,” unfair and harsh criticism and threats to fire an employee, uncorrected by management, may constitute objectively intolerable working conditions;
a supervisor’s extended campaign to get an employee fired, including repeated efforts to invent documentation for her termination, frequent reorganization of her duties and demands that she process unlawful orders, may constitute “intolerable” working conditions when the employee’s medical condition is exacerbated by stress.
The following conditions have been found to NOT be “intolerable:”

severe verbal abuse of employee (harsh, unfair criticism) in front of other employees and threats to terminate or demote are not intolerable working conditions unless a continuous course of such conduct is involved;
a poor performance rating or demotion, even when accompanied by a pay cut does not constitute an intolerable working condition necessary to support a claim for constructive discharge;
failure to promote over a long period of time is normally not enough to show “intolerable” working conditions.
The claim of constructive discharge is not applicable to at-will employment. There is no constructive discharge where there is no contractual right to continued employment. In other words, if you are an at-will employee (and you are presumed to be in the absence of a contract between you and your employer or any other evidence of your employer’s promise to continuously employ you for a certain period of time), you cannot have a claim of constructive discharge.