What Is Considered Constructive Dismissal? Two Significant Rulings Shed Light On The Threshold

Two significant rulings by the Hong Kong courts provide important guidance on the doctrine of constructive dismissal, clarifying the circumstances in which an employee may treat themselves as dismissed and the legal consequences that follow.

Decisions

In Green Light Multiplex Co Limited v Lam and Ho [2024] HKCFI 2101, the plaintiff employer sued its former General Manager for breach of fiduciary duties, while the General Manager counterclaimed for constructive dismissal and unpaid entitlements. The General Manager alleged that the employer had, without reasonable cause, stripped him of key responsibilities and powers, installed overlapping management, excluded him from management meetings and decision-making, and dismissed his subordinate without consultation, thereby breaching the implied term of mutual trust and confidence.