Can you force an employee to relocate? (Toughest HR Question)

In some cases, forced relocation could potentially risk a constructive dismissal claim
By Brian Kreissl
|Canadian HR Reporter|Last Updated: 06/15/2015

Question: Can an employer force an employee to transfer her work location? Can the employee refuse the move — and what are the legal implications for doing so, both for the employee and the employer?


Answer: Like so many areas of employment law, the answer to this question is “it depends.” In some cases, the courts have found forced employee relocations amount to constructive dismissal, but that depends on the specific scenario in question.


Every case is different but there are a few things to remember:


Not every change will be considered fundamental: A move to a new office two blocks away, for example, is unlikely to be considered fundamental.


The change has to be unilateral to be constructive dismissal: If an employee freely agrees to the change, there is no constructive dismissal, especially if additional “consideration” (a legal term meaning something of value) is provided in exchange. 


Employees have a duty to mitigate: In the 2014 case of Farwell v. Citair Inc., the Ontario Court of Appeal held that, in certain circumstances, a constructively dismissed employee may even have an obligation to mitigate his losses by accepting a lesser position and working out the balance of the notice period. 


Presumably, this principle could also apply in the context of a forced relocation, particularly if the distances involved aren’t too large.


Constructive dismissal

One of the leading cases in this area is the 2004 Marshall v. Newman, Oliver & McCarten Insurance Brokers Ltd., where an insurance brokerage was found to have constructively dismissed a customer service representative when it transferred her to another office, adding about 30 minutes to her commute.


Of particular significance was the fact that when her employer had purchased the business in question, the employee was not informed she might be transferred to another office. Had she known about the condition, she could have refused the offer from the new company and accepted severance instead.


In the absence of a written employment contract with a mobility clause authorizing an employer to relocate the employee, the individual facts would be material. 


The distance involved and the commuting time obviously play a role in determining whether or not constructive dismissal would apply. So unilaterally moving someone from Toronto to Vancouver would likely amount to constructive dismissal.


Obviously, the inclusion of a valid and enforceable mobility clause within a written employment contract allowing the employer to transfer the employee to another location would make it difficult to successfully argue constructive dismissal. 


This is especially true if the clause was introduced prior to the individual commencing employment or if introduced during the course of employment and freely agreed to by the employee — especially if it was supported by additional remuneration from the employer.


The level of the position and the customs and business practices in the industry in question also have an impact. For example, someone in an executive position would likely be expected to commute a longer distance as a result of job relocation versus an entry level clerical employee. 


Likewise, many industries require employees to transfer to other locations on a fairly regular basis, such as banks.


Implications for employers

From a practical perspective, an employee is much less likely to object to a forced relocation if she is provided with sufficient advance notice and relocation assistance from the employer. 


In general, being reasonable and flexible with employees and accommodating their needs goes a long way towards making them more satisfied. Someone being transferred to another location further away could be offered flexible hours or the ability to work from home once or twice per week, for example.


One way of avoiding constructive dismissal entirely is to provide long advance notice of impending contractual changes of up to two years — or even longer in some situations.


This would need to correspond with the reasonable notice period at common law to which that particular employee would be entitled if he was being terminated without cause.


However, as a result of the Ontario Court of Appeal decision in the 2008 Wronko v. Western Inventory Services Ltd., an employee who objects to a fundamental contractual change should be provided with a written notice of termination and a subsequent offer of re-employment effective on the day the reasonable notice period expires. This could presumably apply to an employee who objects to relocation.


Job abandonment

In a situation where an employee flatly refuses to accept relocation and there is no possibility of constructive dismissal, he may be seen to have abandoned his position. However, the employer should be reasonable and flexible and make reasonable attempts to contact the individual and try to get him to come into work before terminating employment.


Employers also have a duty to accommodate an employee’s protected characteristics under the governing human rights legislation. This is particularly true in light of the fact courts and tribunals are increasingly recognizing the need to accommodate employees’ family status with respect to their childcare and eldercare obligations, which may have an impact on their commute. 


It may also be necessary to accommodate an employee’s disability, which may make it more challenging for the individual to attend work in another location, for example, if the new location is less accessible by public transit.


Because every situation and every individual are different, employers are advised to seek qualified legal advice when considering an office move or if an employee is likely to object to a forced relocation.


Brian Kreissl is the product development manager for Carswell’s human resources, OH&S, payroll and records retention products and solutions in Toronto. For more information, visit www.carswell.com.

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