Navigating The Sea Of Constructive Dismissal

In the midst of economic uncertainty and widespread cost-cutting, many employers are currently facing the challenge of how to taper wage costs while avoiding constructive dismissal claims. Can employers make modest changes to spare the bottom line without generating significant exposure to termination claims?

The general rule of constructive dismissal is that an employer cannot make changes to employee terms and conditions of employment that are unilateral, fundamental, and negative. The exceptions to this general rule include where:

1. there is consent to the change;
2. there is acceptance of the change after the fact;
3. there is reasonable advance notice of the change or notice consistent with terms of an agreement (e.g., the employment agreement allows for changes on certain specified notice, although caution should be taken with this approach);