You’ve been Reassigned at Work: Is it Really a Constructive Dismissal in Disguise?

 

Employers and employees aren’t always well informed on the subject of constructive dismissalOne basic fact is this: if an employer changes a fundamental term of the employment contract without the consent of the employee, that employee may have a case for constructive dismissal.  This is just a small piece of the puzzle and may raise some basic questions, such as:

 

  • What exactly is a fundamental term?
  • How much or how little change is required for someone to know if a constructive dismissal has taken place?
  • Should an employee pursue legal action in the event of a constructive dismissal, or just continue working as if nothing has happened?

 

Determining the Elements of a Constructive Dismissal

There aren’t any easy answers, as each case is uniquely its own. A previous article: What You Need to Know and Understand about Constructive Dismissal may provide some insight. However, before making any hasty decisions or pursuing any claim, it’s best to seek professional advice.  The overall context of the employment relationship and the circumstances within must be examined from a legal point of view in order to make any informed decision about whether a constructive dismissal has occurred or not.

Constructive Termination Cases Involving Minor Reassignments or Changes

The more obvious indicators of a constructive termination tend to be things like: significant salary reductions, alterations to commissions or bonuses, geographic transfers, loss or inclusion of title or authority, changes to duties, etc.  What may come as a surprise is that the courts sometimes interpret even the smallest changes in job duties as a constructive dismissal.

 

Whether they seem significant or not, making any unilateral change to the fundamental terms of an employment contract can be a costly mistake for an employer to make.  Here are some examples of recent Canadian court cases to illustrate this point:

 

  • The employee’s hours were cut from 37.5 hours per week to 30 hours per week and the court decided this constituted a constructive dismissal.
  • The employee’s shifts were changed from day to night.  Fortunately, the employment contract clearly stated that work was to occur during the day, providing evidence of a constructive dismissal.
  • The court decided that a constructive dismissal occurred when the employer insisted the employee pay for a corporate training program. This program would have amounted to 3% of his total salary.  The employer committed a serious breach of the employment contract when he required the employee to pay for training.
  • Without the employee’s consent, the employer shifted the employee from working inside the company building to working outside as a gate person.  His daily duties were similar, and his salary, title and position remained the same.  While salary, title and position can be the deciding factors in many constructive dismissal cases, the Ontario Court of Appeal declared that “another important factor is conditions of employment” and ruled in favor of the employee.
  • After roughly 4 years of working indoors, an employee was forced to work outside in a “yard shack.” The Court of Appeal believed that the employer wanted the employee to quit; as the employer’s harsh treatment of the employee seemed to indicate that his services weren’t valued or wanted. Conduct was also cited as a factor in this constructive dismissal case.  It was implied over a 4 period that indoor work had become a fundamental term of the employment contract.
  • Conduct also played a role in a case where the employer changed the payment format of an employee.  For a 13 year stretch, the employee’s salary was paid by cheque.  This lengthy pattern of conduct amended the employment contract and made payment by cheque a fundamental term.  When the employer began to make payments by electronic deposit without the employee’s approval, a constructive dismissal had occurred.

 

When it’s Time to Make a Decision

 

A  constructive termination will force the employee to make a choice. Either go along with it, allow the changes / new terms and continue to work; or accept the dismissal, end the employment voluntarily and take legal action.  Constructive dismissal damages can be extensive, but before moving forward, it’s best to speak to an expert in employment law.  Find out if you have grounds for a claim by contacting Constructive Dismissal Lawyer, Bob Yeager.

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