During the COVID-19 pandemic many employers are having to make changes to their workplaces, including their levels and type of staffing. This can mean that some employees are being asked to work from home, work less hours, or not work at all. Employees may view these changes as a constructive dismissal.
What is a constructive dismissal? A constructive dismissal occurs when an employer makes substantial changes to the terms and conditions of an employee’s employment. These changes can include the following:
- decreasing an employee’s pay;
- failing to pay an employee;
- taking away supervisory duties;
- assigning different tasks; and
- changing a work location.
The above changes typically need to be significant, and not inconsequential. In addition, the changes would need to be made unilaterally by an employer. Notably, if an employment contract allows for such changes, it would be difficult for an employee to assert a constructive dismissal. However, unionized employees cannot typically assert that they have been constructively dismissed. A collective agreement provides a different legal regime for terminations of employment of unionized employees as compared to non-unionized employees.
The COVID-19 pandemic is a new, constantly evolving crisis situation. Employers of all types and sizes are being forced to do business fundamentally differently due to public health, and government directives. As such, most business are not legally permitted to allow their employees to work in their normal worksites, travel to visit customers, or allow their employees to perform certain work tasks. Examples of this include, gyms, day care centres, schools, and dental offices.
Some employers now have no customer/client base, and/or have had to reassign their employees to perform other tasks. This has led to employers laying off employees, redeploying employees to other tasks, and employers reducing the hours and/or pay for some employees. These employees may be entitled to statutory leaves and/or Employment Insurance benefits. For more information, see our earlier posts on layoffs and terminations, Employment Standards Act leaves, or Employment Insurance.
Should an employee claim that they have been constructively dismissed given certain workplace changes?
Establishing a constructive dismissal is always a function of the specific facts in a case. However, the following points bear noting:
- A court may consider the COVID-19 pandemic to a circumstance that gives an employer an implied contractual right to make changes to an employee’s employment;
- If an employee accepts and layoff and is reemployed, the amount of damages they are entitled may be limited; and
- Various current and future government financial packages for business and employees may render the issue of loss of pay as moot.
Consequently, employees should carefully weigh whether asserting a constructive dismissal makes sense, or is practical in their specific circumstances.
In any event, employees should clearly understand the changes that are being made to their employment and ensure that those changes are outlined in writing.
Conclusion
If you need legal advice about constructive dismissals, reach out to a lawyer at Turnpenney Milne LLP. We would be happy to assist you.