'It's not so much about what the employer did right, but some of the things the employee did wrong'
A British Columbia worker acted to soon when he claimed constructive dismissal right after his employer made temporary changes to his job duties and location at the start of the pandemic, the BC Supreme Court has ruled.
It’s an example of how temporary changes may not meet the bar of constructive dismissal and such claims are evaluated on an objective, reasonable basis rather than a subjective one, according to Nicole Toye, an employment lawyer and partner at Harris & Company in Vancouver.
“I find this to be a very interesting case because it's not so much about what the employer did right, but some of the things that the employee did wrong,” says Toye. “When you read through the narrative [of the case], it sounds like [the employer] acted very reasonably and quite fairly with [the worker], but he was viewing everything that happened through a very negative lens.”
Communication problems
Island Lake Resort Group (ILRG) owns and operates two lodges in Fernie, B.C. The lodges aren’t accessible by car in the winter, so guests and staff have to ride on snowmobiles or larger snowcats to get there. ILRG also has an office in town for administrative purposes.
The worker was hired as a cook at the lodges in 2001, working his way up to sous-chef and chef. He left in 2007 to obtain a diploma in restaurant management, returning in 2011 as the executive chef for the resorts.
The worker’s duties included providing leadership and direction to culinary staff, hiring and firing, creating and updating the culinary plan, and overseeing department budgeting and purchasing. His wife also worked for ILRG as a manager of the lodge’s restaurant.
In October 2019, ILRG became aware of communication issues between the worker and kitchen staff. The worker was told in a performance review that he needed to improve in his area.
In January 2020, ILRG terminated the employment of the worker’s wife. The termination was announced in an email to the ILRG management team, but the worker wasn’t included on the email.
The worker felt that his workplace became toxic after his wife’s termination and his colleagues became unfriendly towards him. In an email to the CEO, he said he didn’t feel comfortable meeting with him and he believed that his job was in jeopardy. He also said that he didn’t want to collaborate with anyone involved in the decision to terminate his wife.
The worker took a medical leave beginning Feb. 6, 2020. In a group text that inadvertently included the worker, the HR manager sent a text saying she wanted to meet with the management team to update where “each of you are at.” The worker took this to mean he was being further excluded.
Special instructions upon return from leave
The worker announced on March 14 that he would be returning to work two days later. He met with the HR manager and the CEO, and they told him that due to the COVID-19 pandemic, the lodge would be closing on March 18. The CEO also told him to not go to the lodge because clients and non-essential staff were being removed and he should work from either the office or from home. The CEO instructed the worker to build a communication plan to address the kitchen staff’s concerns regarding his communication style and he shouldn’t speak with any staff until a meeting on March 19.
On March 17, the worker was told that he should plan to engage culinary schools and recruit chefs, draft the communication plan to present to the kitchen staff at the meeting, and prepare budgets and menus.
However, later that same day, the worker emailed ILRG saying that he viewed the company’s actions as a repudiation of the employment contract, he accepted the repudiation, and he was being constructively dismissed. ILRG paid him for his work up to and including that day, while the lodge closed as expected on March 18.
The worker filed a claim for constructive dismissal damages, arguing that ILRG breached the employment contract when it prevented him from attending the lodge and speaking with his staff, excluded him from management emails when his wife was terminated, and created a toxic work environment after his wife’s termination.
Test for constructive dismissal
The court noted that the test for determining constructive dismissal established by the Supreme Court of Canada involves a substantial or fundamental change in the terms of the employment contract or a series of acts by the employer that would lead a reasonable person to conclude that the employer no longer intends to be bound by the employment contract.
The court found that there was no substantial or fundamental change in the worker’s terms of employment because the requirements to stay away from the lodge and not speak with kitchen staff were temporary. The former was due to the pandemic and ILRG’s desire for the worker to prepare for the meeting, and the latter would only last until the scheduled March 19 meeting, said the court.
Temporary steps regarding how work will be performed is an implicit term of the employment contract, the court added.
“I think this is where it comes back to the allegation of constructive dismissal being premature,” says Toye. “Ultimately, the court had to make an assumption or an assessment as to: Were these in fact temporary directions or was this something that the employer was intending to do to permanently change the terms of employment?”
Temporary changes not repudiation of contract
The circumstances of the pandemic created a situation supporting ILRG’s actions as a temporary measure and not a breach of the employment contract, adds Toye.
“In certain circumstances, giving directions like that – to not speak with other staff, or to not come to the workplace – in a different context or if it was intended to be a more permanent change, those are the kinds of things that might amount to constructive dismissal,” says Toye. “But in the context of what actually happened here, and especially with the added layer of COVID, the court just wasn't prepared to find that that's what was actually happening.”
The court also found that the worker was put in a difficult situation when his wife’s employment was terminated and the worker took ILRG’s demands when he returned from his medical leave as an opportunity to treat the employment contract as repudiated and end the employment relationship. However, his decision was too quick and didn’t allow the worker to determine how the changes might affect his responsibilities – something a reasonable person would be expected to do, said the court, which also noted that the worker’s reluctance to collaborate with anyone involved in his wife’s termination showed that he viewed ILRG’s conduct in subjectively negative manner.
Objective view
Although the worker perceived a pattern of negative events targeting him, the objective evidence indicated otherwise. The temporary measures made by ILRG were reasonable and did not breach the employment contract, said the court in dismissing the constructive dismissal claim.
Toye emphasizes that the constructive dismissal test includes not only fundamental changes to the terms of employment, but also how a reasonable person would view the changes – a key element in this case.
“When you're giving directions or looking to make any kind of change to an employee's contract, I think you want to proceed with caution around whether it's intended to be temporary or something of a more lasting nature,” says Toye. “Because those are exactly the kinds of things that can give rise to a constructive dismissal, even though in this particular case the employee wasn't successful in meeting that standard.”
In addition, a case like this one shows that temporary changes to a job might withstand the constructive dismissal test and an employee who immediately claims constructive dismissal may not be right, says Toye.
“When an employee thinks that they've been constructively dismissed, they have to basically accept their employer’s repudiation and end the employment relationship – that's a significant call for the employee to make,” says Toye. “Sometimes it might have just been a brief, temporary change that barely impacted their employment and in other cases, over time, you can see how the changes actually might impact employment.”
“But it's a hard decision to make for the employee because it can have pretty significant consequences for [them] if they act prematurely and get it wrong.”
See Farkas v. Island Lake Resort Group (2003) Inc., 2022 BCSC 1282.
