Constructive Dismissal is defined as “a unilateral and fundamental change to the employment relationship”. What this means is that an employee’s job or important elements of it have been changed without their input or agreement. Examples of this might be a significant reduction in compensation, changes in work hours, changes in reporting relationships, demotions and changes in locations of work.Constructive dismissal can also occur if an employee finds themselves in a situation of intolerable working conditions that could include being harassed, bullied, sexually harassed or discriminated against.
In each of these cases, it is important to know that the employer can only make certain types of changes to the employment relationship without the employee’s consent and without properly compensating the employee. Where changes are made that are fundamental such as those described above constructive dismissal may be the result.
Where employees are subject to bullying (such as name-calling, or public criticisms) or sexual harassment (such as improper touching or sexual advances) by another employee, and the employer does not address the situation, both the offending employee and employer can be held liable. Where the employee subject to the harassing behaviour resigns as a result, they may have grounds to claim constructive dismissal.
In general, an employer can terminate employment without just cause, as long as they give an employee reasonable working notice or compensation instead of working notice. An exception to this is if an employer has violated an employee’s human rights or violated certain parts of the Employment Standards Act (i.e. failure to reinstate an employee after pregnancy leave).
There is an implied term in every contract of employment that an employer will provide an employee with reasonable notice of termination. This presumption may be rebutted with a valid and enforceable termination clause, in the absence of which the common law applies as determined by judges through cases decided on this issue. Where the common law applies, an employer must then provide an employee with reasonable advance notice of termination or payment in an amount equivalent to all salary and benefits that the employee would have earned during the reasonable notice period.
Thus when speaking of “wrongful” dismissal, it refers to the failure of an employer to provide an employee with reasonable notice and the dismissal itself so long as the employee is being terminated without cause.
At RV Law our lawyers are experienced in representing clients where constructive dismissal and wrongful termination are at issue. Our lawyers will vigorously advocate on behalf of the client to achieve the best possible outcome.