Can work travel equal constructive dismissal? (Toughest HR Question)

Having to pay an employee extra for time spent travelling depends on circumstances

Colin Gibson
Question: If travelling isn’t normally part of an employee’s job, is there risk of a constructive dismissal or an obligation for extra compensation if the employee is required to take multiple business trips over a short period of time?

Answer: Under common law, a constructive dismissal arises where an employer changes a fundamental term of employment without the consent of the employee. In such circumstances, the employee is entitled to take the position that the employer has repudiated the employment contract, and she may resign and seek wrongful dismissal damages.

A constructive dismissal claim will fail if the employer is able to show its actions were consistent with the express or implied terms of the employee’s employment contract (the terms of employment were not changed after all) or the change was not sufficiently “fundamental” to qualify as a constructive dismissal.

The classic constructive dismissal involves demotion, reduced remuneration and some form of humiliation. But there are other types of changes made unilaterally by employers that have also been found to be a repudiation of the employment contract.
Whether a requirement that an employee take multiple business trips over a short period of time would be a constructive dismissal will depend on the particular circumstances. If the employee occupies the type of position where it is reasonable to expect business travel may be required from time to time, he will not be able to claim a requirement to go on business trips has resulted in a fundamental change to the terms of employment.

In Owens Illinois Canada Inc. c. Boivin, the Quebec Court of Appeal considered a travelling salesperson’s claim for constructive dismissal. The employee, who spent between two-and-a-half to three weeks travelling for work per month, was asked to relocate temporarily to England for six months. The employee refused and claimed constructive dismissal. The court found that given the nature of the employee’s position, the request was reasonable.

On the other hand, the imposition of a requirement to take multiple business trips may be a constructive dismissal if the nature of the employee’s position or the terms of the employment contract are such that multiple business trips were not in the reasonable contemplation of the parties. An example is Reynolds v. Innopac Inc., where the employee was employed in Ontario as vice-president of HR.

As part of his job, the employee was required to visit the employer’s plants, most of which were in eastern Canada and the eastern United States. When the employer required the employee to accept a transfer to Vancouver, the employee refused and claimed constructive dismissal.

The court agreed that the employee had been constructively dismissed, and noted that the move to Vancouver would have caused a significant increase in the employee’s travel time and required him to work longer hours.

Extra pay required?
The question of whether an employer is required to pay an employee extra for time spent travelling on business trips will also depend on the individual circumstances.

If an employee occupies a managerial role that includes business travel and is paid a salary regardless of the hours of work performed, then absent a specific contractual entitlement, it is unlikely the employee will be able to claim extra pay for business travel.

Non-managerial employees, on the other hand, will normally be entitled, under employment standards legislation, to wages for “work” performed for the employer. This may sometimes include travel time.

Generally speaking, the time such employees spend commuting is not compensable. However, if an employee has a usual workplace but is required by the employer to travel to another city, the time travelling to and from the other city is likely to count as work time.

Also, employees who work at several job sites will usually be entitled to be paid for the time spent travelling from site to site, although the time spent driving to the first site will likely be considered a commute for which wages are not payable. Where non-managerial employees are required to travel, time spent travelling during the normal work day will normally be compensable.
Employees may also be entitled to payment for time spent on flights and in airports outside business hours, although time spent in hotels and restaurants outside the workday will usually not be compensable.

To avoid uncertainty, employers should ensure their policies, employment contracts and job descriptions clearly articulate business travel requirements and entitlements. Employers should also check the employment standards laws in their jurisdiction regarding the treatment of travel time.

For more information see:
• Owens Illinois Canada Inc. c. Boivin, 1988 CarswellQue 104 (Que. C.A.).
• Reynolds v. Innopac Inc., 1998 CarswellOnt 229 (Ont. C.A.).

Colin G.M. Gibson is a partner with Harris & Company in Vancouver. He can be reached at (604) 891-2212 or [email protected].

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