Constructive Dismissal: What it is and Why it Matters

Constructive dismissal occurs when an employee resigns due to a breach of contract by the employer or a hostile work environment. If an employee feels somewhat forced to resign because an employer has failed to hold up their end of the bargain or has created an unhealthy work environment, then this resignation is, in some cases, seen as a termination.

Why is constructive dismissal important?

Constructive dismissal means that even though you are the one that quit, you have the right to claim wrongful dismissal. In this case, although you resigned, the situation is treated as if you were let go without notice or termination pay.

If your resignation is ruled as constructive dismissal, you can then claim for pay in lieu of termination notice, or in some more severe cases, aggravated damages.

What qualifies as constructive dismissal?

Constructive dismissal cases are hardly ever black and white, and are always closely investigated on a case-by-case basis. Although the interpretation of constructive dismissal can be ambiguous, the Supreme Court of Canada has outlined two main criteria:

  • A single unilateral act by the employer that breaches an essential term of an employee’s employment contract

This could include change in compensation, change in duties, change in work location, etc.

  • A series of acts by the employer that, taken together, show the employer no longer intends to be bound by the employment contract

This requires a careful look at the employer’s conduct over a period of time in order to identify whether or not the employer has made it virtually impossible for the employee to continue working in that environment.

What can you do?

You may currently be in a situation where you feel you need to resign as a result of your employer’s behaviour. Whether this is the case or not, there are certain things you can do to prepare and protect yourself. Constructive dismissal is centred around what an employer has explicitly (and sometimes implicitly) promised their employee. This is why it is so important for you to read your employment contract. If you have a copy of your contract, take the time to thoroughly review it, and if you don’t have a copy, ask your supervisor for one.

As a member of Teamsters 987, you have what many workers out there don’t have – support and protection. If you feel that your employer has either breached your employment contract or created an exceptionally hostile work environment, get in touch with us, we’re always here to help.

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