Know About Constructive Dismissal in Canada
When an employer makes significant changes to an employee’s job without their consent, the employee may be able to file a constructive dismissal claim. Although it can be challenging to prove, the consequences of a constructive dismissal are substantial for both employees and employers.
When a constructive dismissal claim is successful, the employee is awarded a severance package that covers their loss of income, including wages, commissions and bonuses. In addition to severance pay, other damages may be awarded, depending on the circumstances. These include emotional distress, loss of career and reputation, and any additional expenses incurred during their job search.
The legal rationale behind a constructive dismissal is that an employer is no longer meeting its contractual obligations under the Employment Standards Act (ESA) when it fundamentally alters an employee’s job, work environment or compensation. The change must be unilateral and must not be for a legitimate business reason.
As a result, it is extremely important for an employer to carefully weigh the pros and cons of making any changes to an employee’s job before doing so. Although it is not possible to predict whether a change will trigger a constructive dismissal, some key signs of an issue are:
What You Need to Know About Constructive Dismissal in Canada
While employees should not make a rash decision in the heat of the moment to resign and immediately claim constructive dismissal, it is also crucial for them to seek guidance from an experienced lawyer. A Toronto constructive dismissal lawyer will review the employee’s employment contract and other relevant documents to assess their potential rights, and help them develop an appropriate strategy going forward.
In general, an employee will be given a period of time to decide whether or not they accept the changes that triggered their right to make a constructive dismissal claim. The amount of time will vary depending on the type of change and the individual circumstances of the case. For example, an employee whose compensation has been significantly reduced will likely need to make a decision relatively quickly, while an employee whose position or responsibilities have been eliminated will be able to consider their options for a while longer.
Once an employee decides to resign from their job in order to claim constructive dismissal, they must do so within the required notice period as set out in the ESA. If they do not, they will be found to have resigned voluntarily and won’t be entitled to any severance pay.
While a constructive dismissal claim can be difficult to prove, it is an extremely important legal remedy for employees who are subjected to adverse workplace conditions. If you have concerns about a potential claim, contact Bune Law to book an appointment with a Toronto constructive dismissal lawyer today. Our team will review your situation and provide expert guidance throughout the process. We have successfully negotiated many constructive dismissal claims, and will guide you through the process from start to finish. Our consultations are free of charge and confidential.