Constructive Dismissal is an area that many employees and employers in Alberta do not understand. Constructive Dismissal is a unilateral, fundamental change to the contract of employment, which means the employer is deemed to have fired the employee. The Supreme Court of Canada looked at this issue in Potter v. New Brunswick Legal Aid Services Commission, 2015 SCC 10
Essentially the Court defined Constructive dismissal as a change made by the employer unilaterally (i.e. without agreement of the employee). It has to be enough to be a breach of the contract and it has to be a substantial change to the term of the contract. Whether an action by an employer is constructive dismissal depends on the circumstances. The courts also look at whether the employer is showing an intention to no longer be bound by the contract of employment. The court doesn't look at a single act but all the actions of the employer in the circumstances.
The remedy for Constructive Dismissal is usually to resign and sue. In Potter the Supreme Court suggested it may be possible to sue and continue to work under protest. The employee can also accept the change, and after a time the right to sue goes away. An issue in these cases is usually whether the employee simply voluntarily resigned.
Examples of Constructive Dismissal
In Potter a suspension was found to be Constructive Dismissal. In the Alberta case of Alberta Computers.com Inc v Thibert, 2019 ABQB 964 , a toxic work environment was found to amount to Constructive Dismissal. In other cases, reorganizations, and demotions have been found to constitute Constructive Dismissal. Changes in location, hours, and pay can all constitute constructive dismissal.
If you believe you have been Constructively Dismissed, please feel free to contact us.
The information contained in this article is not legal advice. No solicitor client relationship is formed through this article. The reader is encouraged to retain counsel for advice in these matters.
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