Remote worker moving to another city

Question: If an employee with a remote-work agreement moves to a different city without the employer’s consent and can’t easily visit the office, can this be cause to revoke the agreement or dismiss the employee?

Answer: Whether an employee working remotely can move to a different city without employer consent will likely depend on the terms of the employment contract or remote-work agreement. Just as the right or ability to work from home is an entitlement granted through the terms of an applicable contract or agreement, so is the right to work from a different city. More specifically, an employee’s remote-work agreement does not necessarily include or imply the right for an employee to work remotely from another city. The employer has authority to determine the location where the work is performed and this is expressed through the agreement. 

However, if the employment contract or remote-work agreement is silent on the issue, the employee may not be in contravention of their respective agreement if they decide to work in a different city. Moreover, the employee may wrongfully assume that they are permitted to work remotely from any location. This was the case in Ernst v. Destiny Software Productions Inc., where the employee had a remote-work agreement permitting him to work in Calgary for a Vancouver-based software company. The agreement did not specify the location and the employee moved to Mexico under the assumption that he could work remotely from there. However, the court upheld the company’s decision to terminate the employee for failing to return to work in Canada when requested to do so. Another case out of British Columbia considered the same issue and held that the refusal of the employee to return to work at the location specified by the employer amounted to willful disobedience and insubordination, which are grounds for termination.

Further, there are valid reasons why an employer may want to control the location of its employees. For example, depending on the nature of the business, there may be situations where the company requires employees occasionally to complete in-office or location-specific tasks or where communication among  employees requires that they operate in the same time zone. Depending on the role and responsibilities of the employee, there may also be tax implications for the employer if the employee were to work remotely from a different province or country. This issue may arise where an employee has the authority to enter binding contracts on behalf of the company and has relocated to another province.

In addition to the foregoing, the following practical considerations are also important:

• Employers should ensure that their telecommuting policy or written agreement states the location where employees are to work. In addition to specifying work expectations, these policies should also include the company’s stance on remote work and acceptable locations. 
• Employers should reserve the right to determine an employee’s remote workplace location in any policies or agreements outlining remote-work or telecommuting. 
• If an employee does relocate without the employer’s permission, the employer should first request they return to the original location prior to issuing a termination. 
• Employers should be aware that an employee who works in a different province under a remote-work agreement may be subject to that province’s employment standards legislation instead of the legislation of the province in which the company is located.

For more information, see:

• Ernst v. Destiny Software Productions Inc., 2012 BCSC 542 (B.C. S.C.).

Tim Mitchell practises management-side labour and employment law at McLennan Ross in Calgary. He can be reached at (403) 303-1791 or [email protected]