Hi there, dialogue between the two parties or some form of mediation will be the most appropriate way to try and resolve matters here. One person believes that their position is untenable but it is up to them as to whether they act on that and raise a formal complaint or even consider resigning and claiming constructive dismissal. To pre-empt either of these you may wish to offer to act as a mediator between the two to try and resolve this as amicably as possible. You cannot force either of them to participate in such an exercise but make it clear that it is in the interest of both parties if this matter is resolved now, rather than letting it become worse over time or get out of hand.
If they agree to mediate then you can do this either all together, by having all of you attend a meeting, or to act as a negotiator between them in the event that they do not wish to attend together.
So this is the most obvious and likely way to try and resolve these issues, subject to both parties agreeing to participate. If either refuses to then you will have to wait and see if this goes any further, for example if the person resigns claiming constructive dismissal. Then you can consider matters again and decide how to take things further if needed.
Also if this person is adamant that they cannot continue working there as a result, alternative way out is to approach the employee on a 'without prejudice' basis (i.e. off the record) to try and discuss the possibility of leaving under a settlement agreement. Under a settlement agreement, the employee gets compensated for leaving the company and in return promises not to make any claims against the employer in the future. It is essentially a clean break, although the employee does not have to agree to it so it will be subject to negotiation. In any event, there is nothing to lose by raising this possibility with them as it would not be used against you.
I hope this has answered your query. I would be grateful if you could please take a second to leave a positive rating (3, 4 or 5 stars) as that is an important part of our process and recognises the time I have spent assisting you. If you need me to clarify anything before you go - please get back to me on here and I will assist further as best as I can. Thank you