Understanding The Law In Alberta Surrounding Constructive Dismissal

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Understanding The Law In Alberta Surrounding Constructive Dismissal

Losing your job often causes emotional and financial stress. Sometimes remaining with an employer causes even more stress than if the employer fires you. This is especially true if your employment changes significantly. Constructive dismissal, at its basic level, includes situations where an employer makes changes to your position so that you are not, in essence, at the same position anymore. More details follow below, however, in any situation that you believe you face constructive dismissal, you must consult with a lawyer to understand your rights. In these cases, an employee quitting their job, has the same consequences as firing an employee without cause. Our advice is to speak to a employment lawyer before you do or say anything to your employer about things. The Constructive dismissal lawyers at Calgary based Kahane Law Office, help people facing tough changes to their position at work.

What Is Constructive Dismissal?

As with all contracts, no party to any contract, unless specifically stated in the contract, has the ability to change the contract unilaterally. This means that any changes made to the contract need to occur with both parties agreeing to it. This is true for not only written contracts, but verbal ones as well. Further, the contract and / or its terms, often include express terms, but also implied ones. This is as true for employment contracts as any other contract. Constructive dismissal occurs when the employer changes significant terms in the contract. While many examples exist for such changes, some occur more often then others. For example, the significant changes that we see in constructive dismissal often include a change in:

  • An employees responsibilities at work;
  • The position of the employee, for example a demotion;
  • How much the employee makes;
  • Where the position is located;
  • An employees ability to perform their job;
  • Scheduling or work hours;
  • Any significant change to benefits or compensation of employment;
  • The work environment;
  • How much work the employer expects the employee to do; and lastly
  • Any other significant change to the work term.

In addition, employees facing abuse or harassment, often have a claim against their employer for constructive dismissal.

What Changes Lead To Employee Damages

As stated, the changes need to be significant. At times, the change is one significant change. In other situations, the significant change is a series of small changes. Often the small changes do not, on their own, constitute constructive dismissal, however, when taken as a whole, the may. Employers must look at the overall nature of what they plan to change to determine if they face liability for damages to employees.

How Courts Determine If A Person Is Constructively Dismissed

The courts in Alberta look at a three part test to determine constructive dismissal. Each element is essential to proving it. Further, it is the employees responsibility, in court, to prove that these three things occurred. Firstly, the employee needs to prove the terms of their contract of employment. If the contract is a written one, then this is easy. If it is a verbal or implied term, it is more difficult. In this case, the term is demonstrated by emails, letters, long standing practice, etc.

Secondly, the employee needs to prove that a breach of a significant term or terms occurred. Employees often prove this by demonstrating a significant change especially if the change is sudden. Lastly, the employee must prove that not only did a breach occur, but the breach was of a fundamental nature. For example, the breech needs to be more than just a minor change, it needs to go to the heart of the nature of the employment contract.

Avoiding Constructive Dismissal Claims

We strongly encourage employers to seek legal guidance before making significant changes in the workplace. If you think potential, upcoming changes are significant, look at getting legal advice to determine the legal nature of the change. Strategies exist to avoid constructive dismissal claims. These include giving reasonable notice and having employees consent to the change if they the consent after receiving proper information of the change.

A Caution To Employees On Accepting Changes

As stated above, an employee who give informed consent to the change, does not have a claim for constructive dismissal. Ideally this consent is in the form of a written document signed by both the employee and employee. Sometimes, this consent occurs by action, not written agreement. For example, this occurs if a significant change is implemented by an employer, and the employee decides to keep working in that new capacity. If, after a time goes by, the employee then decides that they do not like the change, then they may be deemed to have accepted the change.

Employees Duty To Mitigate Constructive Dismissal

Any employee that faces termination without cause, wrongful dismissal or constructive dismissal, has a positive duty to mitigate the loss of employment. Essentially, this means that the employee must try to find a new job. At times, with constructive dismissal, this may mean taking a position with their former employer. For example, if the employer offers a position that is similar to the one they originally had, temporary or otherwise. Of course, if they face abuse or harassment, this does not apply.

Damages To Employees

The courts order damages for employees whom the court finds faced constructive dismissal. Damages assessments, in monetary terms, include up to three aspects. Firstly, the employee is entitled to a notice period payment as set out in the Employment Standards Code in Alberta. Secondly, they may, depending on the circumstances, extra compensation if the employer acted in a way, when terminating the employee, that humiliated the employee. Lastly, in extreme cases, the court awards punitive damages to the employee in an effort to “teach the employer a lesson”. For example, the courts award this when an employer intentionally harms an employee. Case law demonstrates that the actions of the employer must be so “malicious and outrageous that it is deserving of sanction”.

Get Legal Advice On Constructive Dismissal Before You Act (Employers & Employees)!

Both employers and employees need legal advice when it comes to constructive dismissal. Employees need to know if they have a good case against their employer before they act. Employers need to understand if their changes will lead to damages or, in the alternative, they need to know what to do to avoid damages. Help is a quick phone call or email away. Our employment lawyers schedule consultations to help people make informed choices. Call or email Kahane Law Office today. Connect with our Calgary, Alberta office at 403-225-8810 or email us to connect quicker.