Constructive Dismissal

| Wednesday, January 20th, 2010 | 3 Comments »

Work responsibilities can change on a dime.

Here is the cautionary tale of two employees who incorrectly assumed their employers had no right to change the terms of their jobs.

Experiencing an enrolment crisis, Acadia University decided it had no other choice but to remove oversight of enrolment and admissions from Paula Cook Mackinnon’s job.

Mackinnon, who had been employed by the university in a senior role for 19 years, disagreed. Believing that the university could not remove an important aspect of her job without advance notice or consultation with her, Mackinnon penned a letter to the president stating that she viewed the changes as significant and tantamount to a demotion.  She gave the university a few days to consider her concerns and provide a response.

When the university did not respond to Mackinnon’s letter before her deadline, she shut off her BlackBerry, cleaned out her personal items from her office and swiftly left the premises, never to return.

The law of constructive dismissal provides that an employee can treat fundamental changes to her job as effectively amounting to a termination.  And in Canadian workplace law, when you are terminated without a good reason, you are entitled to severance.

Justice Gregory Warner, who wrote the recent decision, correctly noted that the issue was not whether Mackinnon had “quit” her job, but whether she had a good enough reason to leave.

However, it could not be said that Mackinnon’s job was substantially different following the changes, as enrolment amounted to less than one quarter of her job. The university was entitled to reasonable leeway with changing business needs.

Similarly, in another recent case, Bank of Nova Scotia executive David Chapman resigned, claiming a reduction in his salary and the bank’s failure to honour a promise amounted to his termination. Although Chapman’s salary was reduced by 13 per cent, it was only the variable component of his pay, such as stock options, shares and bonuses that changed, not his base salary. Agreeing with the bank and dismissing Chapman’s case, the court found that Chapman’s pay could be reduced because he was always part of a variable compensation model and had remained in the applicable range for his position.

Why should employees and employers care about these cases?

Employers often assume incorrectly that they can change an employee’s job as they see fit.  Just as often, employees wrongly assume that their jobs cannot be changed without their consent. As similar facts don’t always lead to the same results, especially in workplace law, my advice is to consider a mutual resolution instead of always marching to the courtroom’s doors.
– Daniel A. Lublin is an employment lawyer with the law firm Whitten & Lublin LLP. Reach him at dan@toronto-employmentlawyer.com

3 Comments

  1. Twana Schimpf says:

    It is good to have the ability to read a good quality blog with useful information on topics that many are interested on. The point that the data indicated are all first hand on real experiences even assist more. Go on doing what you do as we like reading your work.

  2. Kennedy Mokhosi says:

    I’m in RSA in the retail sector supply chain company.I’ve been through a lot of problem concerning unfair dismissal which I later referred to CCMA.I won the case where I was reinstated but now unfairly treated led me to feel unwanted working conditions unbearable. When I am in such a condition what do I turn to safeguard my future?

  3. Kennedy Mokhosi says:

    Please help me because as I wrote the abovementioned letter my family is suffering after I’ve been fired and when I returned as per settlement never honored by my employer not paying me and not coorrectly putting me back at work resulting in myself becoming financially broke being sent from pillar ro post, please help me before I lose it?

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