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EMPLOYEE OPTIONS WHEN FACED WITH A CONSTRUCTIVE DISMISSAL

Imagine that you have worked for years and lived in Simcoe, Ontario and your employer suddenly tells you that your job is being moved to St. Catharines.  You are assured that your job in St. Catharines would be substantially the same as the responsibilities you carried out in Simcoe.  When you point out to your employer that the new position will involve three hours of commuting each day, an hour and a half each way, and that the costs of that commute will reduce your overall income, in polite terms you are told those are the lumps. 
 
So what do you do next?  If you don't accept the transfer to St. Catharines, are you quitting or have you been fired? 
 
There are many circumstances in which an employee can be held to have been terminated without anyone ever saying the words, "You are fired".  These situations are called constructive dismissal cases. 
 
If an employer changes significant terms of your employment without notice you have three options:
(1) Accept the change and do nothing, consoling yourself that a job is better than no job; (2) Tell the employer you're going to take the new position in order to lessen your damages but reserve the right to pursue a legal remedy at a later day; or (3) Refuse to accept the changes, leave your employment and sue for wrongful dismissal.
 
Let's imagine that you have been at this job for five years when these changes are imposed upon you.  Let's imagine that you are entitled, at most, to five months reasonable notice based on your age, level of responsibility and seniority.  If you choose the second option of living with the changes but reserving your right to pursue legal remedies later, all you can do is bring a lawsuit against your employer for the cost of commuting for the first five months after the transfer to St. Catharines.  If you can be terminated and paid five months salary in compensation for the lack of advance notice, the employer could have simply told you that five months from today you would start working in St. Catharines.  If that had happened there would be no wrongful dismissal suit to pursue.  Although the employer changed a significant term of your employment, it gave you reasonable notice in all the circumstances.  Another way of putting it is that the employer told you were terminated in five months but that you are being offered a new job after that five months if you want it.  If you don't want it, you don't have to take it.
 
So, if the change could have been made with five months notice, you can't sue for more than five months of the extra commuting costs.  You might decide that you were better off taking the position that you are terminated immediately and instead of spending the next five months working at a job you don't want and commuting for fifteen hours a week, you should spend your energies looking for new employment.  In that case, you will choose the third option of leaving your employment and suing for wrongful dismissal.
 

This is the option that a man from Simcoe chose when the events outline above happened to him.  The matter eventually ended up before the Ontario Court of Appeal and it found that the man from Simcoe had been constructively dismissed and was entitled to reasonable notice.  It found that the annual costs of commuting fifteen hours a week would have been $34,000.  The employer wasn't offering to compensate for that cost so, in effect, the man's salary had just been reduced by $34,000 a year.  Clearly, if you tell any employee that they are immediately subject to a $34,000 drop in pay, you have constructively dismissed them.
 
Although it wasn't a factor in this case, the addition of such extensive commuting time can be a constructive dismissal for other reasons than the costs of the commute.  Imagine that you are a single parent living in Simcoe and working there.  Leaving the house at 7:30 in the morning rather than being available to drop your children off for school at a quarter to nine may be an impossibility.  The courts will take personal factors into account when assessing the reasonable notice of a transfer in work location.  On the other hand, if you are a single person living in Hamilton who had been working in Simcoe, the court would make nothing of the fact that you are going to drive three quarters of an hour to St. Catharines rather than the same length of drive to Simcoe.
 
It is extremely important that when people are faced with a significant change in the terms of their employment and are considering taking legal action that they consult a lawyer who confines their practice to employment law.  Constructive dismissal issues are the most difficult issues for employment lawyers when it comes to giving advice.  If you make the wrong call, you could end up on the street with no compensation for the loss of your employment.
 
As published in the Hamilton Spectator, January 13, 2003
 
Ed Canning
Ed Canning
P: 905.572.5809
ecanning@rossmcbride.com