Introduction to the 1997 Constructive Discharge Act

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June 30, 2015


In 1997, the Constructive Discharge law established standards and procedures for constructive discharge claims under Arizona statutory and common law. A.R.S. § 23-1502. In brief, the Act, effective July 21, 1997, provides two methods by which an employee may establish a constructive discharge claim. The first method is to provide 15 days written notice to the employer of the working conditions that the employee believes are intolerable before the employee resigns. In order to qualify for the first method and to require employees to wait before resigning, the employer must have informed its employees about the provisions of the law.

The second method of establishing constructive discharge does not require advance written notice to the employer. The Act allows an employee to resign immediately and assert a constructive discharge claim if the employee has experienced a sexual assault, threats of violence, or a continuous pattern of discriminatory harassment which would cause a reasonable employee to feel compelled to resign. A.R.S. § 23-1502.A.2.

Wrongful termination lawsuits may involve factual and legal issues with respect to whether the employer discharged the employee, whether the employee resigned, or whether the employer constructively discharged the employee by making his or her working intolerable. The factual distinction between whether employee resigned or was constructively discharged can make the difference between whether an employee has a claim for wrongful termination under various statutes and common law principles or whether an employee has no legal remedy for the
termination of employment.

Whether a constructive discharge is legal or illegal will depend upon whether the law protects the status of the employee or the employee's conduct upon which the constructive discharge was based. For example, if an employee is employed at will and if the employer is therefore free to discharge the employee without cause, the employer would also be free to constructively discharge the employee. If, however, the employer's harsh treatment of the employee, making the employee's working conditions intolerable, was based on the employee's age, race, sex, national origin, religion, disability or other protected status, then the constructive discharge based on those reasons would, of course, be illegal. Similarly, if the harsh treatment constituting a constructive discharge was in retaliation for the employee's assertion of rights protected by law, then a constructive discharge would be illegal.

The subject of constructive discharge assumed added importance because of a 1995 court  decision that confirmed that employees have a much greater incentive to quit and sue for constructive discharge than to try to take action against their employer while still on the job. If an employee sues an employer to correct unfair treatment while the employee is still working for  the employer, the amount of monetary damages the employee can recover will often be rather limited. If the employee alleges, however, that the working conditions have made continued  employment intolerable and constitute a constructive discharge, then the employee will be entitled to recover the full range of damages available in a wrongful termination case.

In Mintz v. Bell Atlantic Systems Leasing International, Inc., 183 Ariz. 550, 905 P.2d 559 (App. 1995), the Arizona Court of Appeals held that the tort of wrongful termination means exactly that, i.e., that the employer must have terminated the employee. If the unpleasant nature of an employee's working conditions are harsh or unfair, but do not rise to the level of being  intolerable, the employee will not have a common law tort claim for wrongful termination. An employee who alleges that the employer's treatment of them made working conditions intolerable may quit and sue for constructive discharge, including a common law claim for wrongful termination.

The arguments that were made to the Legislature in support of the bill emphasized that some employment litigation could be avoided if the law encouraged employees and employers to communicate with each other regarding problems that arise in the workplace. Requiring employees to give written notice to appropriate company officials regarding allegedly intolerable working conditions may enable some of those working conditions to be resolved, and, therefore, preserve the employee's employment and avoid a potential constructive discharge claim.


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