What is Constructive Dismissal?

Constructive dismissal

Constructive dismissal occurs when an employee is forced to resign due to the employer’s conduct. This can happen when the employer makes working conditions so intolerable that the employee has no choice but to resign. It can also occur when the employer breaches an employment contract in a way that makes it impossible for the employee to continue working.

Constructive dismissal is a complex legal issue, and it can be difficult to prove. If you think you have been constructively dismissed, you should speak to an employment lawyer as soon as possible. They will be able to assess your situation and advise you on the best course of action.



So what should someone in such a situation do?  Resign?

Resignation will generally mean that you give up your right to a severance package – either termination pay and, perhaps, severance pay, or common law reasonable notice pay.  For many people, that is too much to give up. A severance package is meant to cushion the blow of a job loss, by providing income for a period of time considered sufficient to secure alternative employment.  Without that, you would be out of a job and out of an income, all at once. Any benefits you had through your employment would also be abruptly lost. For many Canadians, being stuck between a rock and a hard place is pronounced.  The stakes, after all, are often quite high.

Fortunately, tolerating the intolerable or walking out may not be your only options. In some cases, you can resign from a job while still receiving a severance package.

You can opt to treat your employment as terminated if you feel you have been wrongfully dismissed or treated unfairly by your employer. A constructive dismissal claim means you keep your severance package. The best way to get your deserved compensation after being constructively dismissed from a job is by consulting an employment lawyer.

Here are some examples of unilaterally imposed changes that might justify a constructive dismissal:

  • Demotion
  • Reducing compensation
  • Reducing responsibilities, status, and/or changing reporting requirements
  • Requiring a move/change in geographical location
  • Laying off a non-unionized employee
  • Working in a poisoned work environment (namely in reference to bullying, harassment, discrimination, or improper discipline)



Please note that the above list is not exhaustive. 

A constructive dismissal claim is no “get out of jail job free card” – typically, an employer will deny the constructive dismissal has taken place. The lesson here is not to roll over, but simply that you want to be careful that your claim is a strong one before you make it. Only a qualified employment lawyer can provide the necessary guidance in such cases.

The extent to which an employer can make changes without triggering a constructive dismissal will also be informed by the employment contract. For example, you may be out of luck if a change in hours is the only basis for your claim. Employers have the rightful prerogative to run their business and so reasonable changes will not constitute a constructive dismissal.

If you are considering quitting a job, you may be able to do so without having to pay severance. You should also be careful not to condone the change(s) made by your employer, i.e. do not accept the changes to your employment, neither explicitly nor by implication.

There are many other things to consider in these cases, which is well beyond the scope of this piece. Suffice it to say, then, that sometimes a risk is worth taking. A good lawyer can reduce that risk to a minimum, and, ultimately can help you to move on from an unsustainable position.  If your employer is treating you unfairly, it would be wise to speak to an employment lawyer. The lawyers at Tailor Law are ready to help you. To schedule a free consultation, in-person or over the phone, please call our office at 905-366-0202, or email Chelsea at admin@tailorlaw.com.

Recent Posts

Scroll to Top