When Do Reduced Responsibilities Constitute Constructive Dismissal?

constructive 2
Many employers now have job descriptions for their employees, whether they are in the initial offer letter (for more junior employees) or in a detailed employment agreement (usually reserved for more senior and highly paid employees). Some employers just use titles to denote responsibilities. In between there are employers whose employees, through initiative or necessity, assume duties that had previously been performed by other employees.

Most employers appreciate an employee who goes above and beyond — someone who does more than the minimum required by the job description.

But what happens when an employee has responsibilities taken away, whether they were initially assigned or assumed over time?

At what point does a reduction in responsibilities amount to a constructive dismissal?

When I meet senior executives whose duties have been changed, there is much confusion about what constitutes a constructive dismissal. It is not any change to an employee's responsibilities. It is a unilateral change by the employer which substantially altered the essential terms of the employee's contract of employment. Typically this involves a substantial change such as a reduction in responsibilities or compensation which results in a considerable loss of prestige and status.

Thus, where the employer conducts a reorganization where an employee reports to a former subordinate and suffers a reduction in compensation, the court will likely find that such changes constitute a constructive dismissal. Also, where an employee has responsibilities removed and has fewer reports, a finding of constructive dismissal is probable.

It is not how the employee feels about the changes but whether, viewed objectively, they meet that threshold.

However, the employer can make changes to the employee's position that are allowed by the contract.

A recent case, Robbins v. Vancouver (City), 2014 BCSC 872 (B.C. S.C.), considered whether the employee can assume additional duties as part of her job and then take the position that they have been constructively dismissed if they are taken away.

Carlene Robbins was a long service employee with the City of Vancouver who had risen to the position of manager of the property use branch in the by-law enforcement department with 29 employees reporting to her. She had a close working relationship with Barbara Windsor, her supervisor, who was respond- sable for co-ordinated enforcement of bylaws. Over time, Windsor informally delegated to Robbins more and more of the enforcement responsibilities.

When Robbins retired, her position was eliminated and a restructuring was proposed with someone having the qualifications of an engineer taking over Windsor's responsibilities, some of which had been performed by Robbins. Robbins applied for that position but she was not an engineer and therefore lacked the qualification for the new position.

Subsequently an engineer was hired to take over those responsibilities. Robbins was instructed to turn over the enforcement files she was handling.

Robbins then claimed that the removal of these responsibilities meant she had been constructively dismissed (although her compensation remained the same).

Did the fact that she had assumed those additional and more senior responsibilities which were later removed constitute a constructive dismissal?

In this case, the Vancouver Supreme Court decided that the removal of those assumed responsibilities did not constitute a constructive dismissal because the enforcement responsibilities were never part of her formal job description and therefore their removal did not constitute a unilateral change to the terms of her employment.

Moreover, employers are allowed some deference by the courts in how they manage their businesses. It is not the court's job to micro-manage or second-guess an employer's personnel decisions unless it is to a fundamental term.

So what lessons can be drawn from this case?

  1. Job descriptions matter. If a duty has being assumed by an employee which is not part of that employee's formal job description the employee's responsibilities are not automate- call enlarged.
  2. Where there is a change in responsibilities the employer should confirm that job description has been changed.
  3. The removal of a responsibility (whether in a job description or not) does not necessarily mean a constructive dismissal especially it is not part of the employee's job description. Further, the change must be a substantial one to a fundamental term.

Note: This a reprint of an article by Robert Taylor of Levitt & Grosman LLP.