A framework is derived for developing constitutive laws for engineering materials. The framework is based on physically motivated assumptions on the mechanical and thermal behaviour of plastically deformed and damaged materials. These assumptions are the starting point in a derivation of the relevant thermodynamic quantities. The procedure reveals important cross-dependencies that have to be considered while developing constitutive equations. A major result of this study is that both deterioration (increase of damage) and healing (decrease of damage) can be modelled in an integrated manner using the same constitutive law. For greater clarity the description is limited to small strain and isotropic behaviour