What is Constructive Dismissal in Ontario? 

Constructive dismissal occurs when an employer makes a significant change to a fundamental term or condition of an employee’s job and the employee does not consent to the change. There are a number of different situations that may be considered constructive dismissal and constructive dismissal can affect an employee’s rights in a variety of ways. Our Richmond Hill employment lawyers may be able to provide you with further information about constructive dismissal in Ontario as it relates to your situation.

What Constitutes Constructive Dismissal? 

There are a number of situations that have been found to qualify as constructive dismissal. The change made by the employer must be significant and it must affect an important condition of the employee’s employment. It generally occurs in one of two forms: either the employer imposes one unilateral change that breaches an essential term of the contract or the employment relationship; or the employer’s actions, when taken together, show that the employer no longer intends to be bound by the employment relationship.

Some examples of constructive dismissal include:

  • A significant reduction to the employee’s salary
  • A significant negative change to the place of work or the hours of work
  • A significant change in the employee’s authority or the work tasks assigned to the employee
  • Harassment or abuse of the employee by the employer.

It is not necessary that the employer intended to force the employee out of their position or that the employer was acting in bad faith when the employer made a substantial change to the terms of the employment relationship.

Condonation of the Change by the Employee

If the employee continues to work for a period of time despite the fundamental change imposed by the employer, this may constitute an agreement or acceptance of the new terms. In a situation that might otherwise be interpreted as constructive dismissal, an employee who accepts the new terms has waived the right to sue the employer for constructive dismissal.

An employee must elect whether to resign or accept the fundamental change within a “reasonable” period of time. What a court will consider reasonable will depend on the specific facts of the case. Contact our Richmond Hill employment lawyers for more information on what this might mean for you.

How does constructive dismissal affect an employee’s rights? 

When an employee is constructively dismissed, the employee can either resign and sue the employer for wrongful dismissal, or the employee can stay in the position and sue the employer for damages caused by the unilateral change.

If an employee is constructively dismissed and resigns within a reasonable period of time, this qualifies as “termination” of the employee by the employer for the purposes of the Employment Standards Act. The employee may then be entitled to severance pay and pay in lieu of proper notice.

Like any wrongfully terminated employee, an employee who is constructively dismissed has a duty to try and minimize their damages by finding new employment as soon as possible.

Contact our Richmond Hill Employment Lawyers Today For a Consultation

The law relating to constructive dismissal is complex and highly fact-specific. Our employment lawyers may be able to explain more about constructive dismissal in Ontario in relation to your specific situation. Contact us today!

*Please note that this does not constitute legal advice; it is a general overview on the topic of constructive dismissal. Please consult with a lawyer if you require legal advice.