Constructive Dismissal

Constructive DismissalConstructive Dismissal

Employers can fire employees in several ways.

Your boss may formally terminate you. Or your boss may fire you in a more subtle way which is recognized by the law as a constructive dismissal – entitling you to statutory and common law severance pay – without ever saying the words “you are fired”. For example, you may have been demoted without your consent. In some situations, a demotion with no change in pay can be considered a constructive dismissal. If an employer has set out to make it difficult for an employee to perform employment duties, a case of wrongful dismissal may arise. You may have been temporarily layed-off. Your salary may have been reduced. You have been subject to harassment. Or many of your former responsibilities and duties may have been taken away from you.

If your employer makes any important change in your job without your consent, it may be constructive dismissal.


Not every change in employment, however, will amount to constructive dismissal. The changes must be seen as fundamental, serious, unilateral and substantial – so as to result in the employee performing a job of a different nature than s/he was previously.

Each case turns on its own facts, so it’s important that a constructive dismissal situation be carefully reviewed by a lawyer experienced in employment law. Just because you “can” does not mean you “should” and it is important to weigh the pros and cons with your lawyer.



Delay can hurt the employee who is in a situation that might amount to constructive dismissal. If the employee waits too long in such a situation, the Court may see the employee as accepting (“condoning”) the situation.


However, there are valid reasons for an employee to continue to work in a constructive dismissal situation:

  • • The employee may be attempting to minimize his or her losses pursuant to a common law duty to “mitigate damages”;
  • • The employee may be acting out of financial necessity while searching for replacement employment;
  • • The employee may be testing the suitability of the new arrangements on a trial basis; or
  • • The employee may genuinely accept the new conditions as forming part of the employment contract.

The Court will not determine an employee to have condoned the employer’s wrongful conduct unless the employee genuinely consents to giving up the right to sue. The test for condonation is the intention of the employee. The Court will consider whether a reasonable person in the position of the employer believed that the employee intends, voluntarily and without coercion, to give up his or her legal right to sue and agrees to the changed terms as forming part of the employment contract?

The Courts recognize that an employee should be allowed a reasonable trial period in which to assess the suitability of working under the new terms before condonation will be found.

If the fundamental terms of your employment have been changed without your consent, or if you have been fired or laid off, or are about to be, we can help determine if you are entitled to compensation for wrongful dismissal and the proper legal steps to recover it.

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