Estopped from arguing constructive dismissal

Changes to the employment relationship were accepted by the employee

In 1998 the Counsellor Training Institute Inc. (CTI) sought to obtain accreditation as a private post-secondary institution qualified to train counsellors in British Columbia. In order to obtain such accreditation CTI had to meet a number of benchmarks that had been established by the Private Post Secondary Education Commission.

On Nov. 9, 1998, Ilanna Mandel was made an offer of employment to assist CTI in obtaining the accreditation. The offer was for part-time employment for a salary of $25,000. The letter of employment contained a provision dealing with termination.

The provision stipulated that an employee who has been employed for at least three straight months is eligible for compensation on termination. After three months’ service she would receive one week’s notice; after twelve months she would receive two weeks’ notice and after three years of service she would receive three weeks’ notice plus one week for each additional completed year of employment to a maximum of eight weeks.

Ms. Mandel signed the letter of offer on Nov. 16, 1998, and started her employment. In January 1999 Ms. Mandel informed CTI that its provincial accreditation by the requisite deadline was at risk unless she worked full-time. CTI agreed to hire Ms. Mandel full-time commencing Jan. 15. The increase in hours was only temporary and would be reviewed periodically along with the accreditation tasks. Her salary increased from $25,000 to $50,000 as a result of the increase in hours.

By September 1999 CTI was becoming concerned about the length of time it was taking to complete the necessary requirement for obtaining accreditation. These concerns were brought to the attention of Ms. Mandel. CTI decided to bring in a consultant who was familiar with the accreditation process.

After the consultant was hired, Ms. Mandel continued with other tasks relating to ensuring that CTI received the clearance to provide training to students through its institution. Accreditation was finally obtained in August 2000.

In May 2000 an e-mail was uncovered that Ms. Mandel had written to CTI’s registrar of students that caused CTI to question whether Ms. Mandel had CTI’s best interest in mind in her dealings with personnel. Her e-mail suggested that CTI was having financial difficulties and that if the business folded she would work to start another school and obtain legal possession and registration of a program that she was creating.

In the summer of 2000 CTI began to have financial problems due to low student enrollments. As a cost-cutting measure CTI decided to change Ms. Mandel’s position back to part-time with a corresponding drop in salary. This change was discussed with Ms. Mandel at a meeting on June 6, 2000.

After the meeting Ms. Mandel e-mailed Dan Keeran, CEO, with whom she had met and inquired as to whether her title would be changing as a result. Her title was changed and her employment changed to a consultant arrangement, under contract on a project basis.

She did not object to this change. In a job evaluation dated July 14, 2000, she indicated that she was comfortable in her present position and the job changes were communicated to her in a clear way.

On Sept. 27, 2000, Ms. Mandel was asked to attend a meeting to discuss a number of employment concerns that CTI had related to a loss of trust that CTI had as a result of her actions. One such action was the May e-mail. Another was the failure to disclose a potential conflict of interest in having arranged a contract with her sister. At the end of the meeting Ms. Mandel was put on probation and warned that any further incident would result in her dismissal.

On Nov. 2, 2000, Ms. Mandel’s employment was terminated. She was given two weeks’ pay in lieu of notice based on her two years of employment with CTI.

Ms. Mandel brought an action against CTI for wrongful dismissal. She alleged that she was constructively dismissed when her employment was reduced from full-time to part-time. She further argued that the termination provision in her offer of employment was ambiguous and should be construed against CTI who had drafted it. CTI defended the action, relying in the termination provisions in the offer of employment.

The Court held that by accepting the change in her employment she condoned this change and was estopped from arguing constructive dismissal. Based on her relationship with CTI it was clear that if she was displeased with the arrangement she would have put these concerns in writing prior to her dismissal. Instead she indicated her acceptance, voluntarily agreed to a change in title and gave her job an excellent rating after the change.

As for the termination provision, the Court held that it was clear and unambiguous. She was provided with reasonable severance notice in accordance with the terms of her employment contract. Her action was therefore dismissed.

For more information:

Mandel v. Counsellor Training Institute Inc., 2002 BCPC 71.

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