A BC employee has successfully asserted a claim for constructive
dismissal after being reassigned to a new position. Younger v. Canadian National Railway Company
is a good reminder for employers that the courts may find
there has been a constructive dismissal where an employee has
been reassigned to a new position involving fewer responsibilities
and a reduction in pay.
Younger had been a railway employee since graduating high school
in 1973. He started working as a labourer and eventually advanced
to a management position at CN. In 2004, CN assigned Younger
to the position of Assistant Superintendent Mechanical
("ASM"), which required that he supervise the operations
of three major and three minor facilities. The position required
Younger to be on call 24/7 and to be responsible for the safety and
productivity of approximately 100 employees. In 2005, he was
reassigned by CN to a position which only required that he
supervise one facility and work a maximum of 40 hours a week. In
the new position, Younger would only be responsible for 10
employees and would fall 2 positions on CN's 12 position pay
scale. As part of the reassignment, CN agreed to pay Younger his
current salary for a year; at the end of that period, his wage
would be reduced to the new position's lower pay scale.
Younger declined the position transfer, alleging it was
demotion, and refused to report to work after the reassignment.
Younger found comparable employment five months later.
CN argued that it was entitled to reassign Younger because he
was still in an "implied probation period" following
Younger's initial 2004 promotion to the ASM position. The
court accepted that there may be cases in which there is an implied
probation period following an employee's promotion, during
which time an employer may be able to return the employee to his or
her former position without being found to have fundamentally
breached the contract. However, this was not one of those cases. At
the time of Younger's 2004 assignment to the ASM position he
had been working in a comparable position for about 5 years. As
such, the ASM position could not be considered a
"promotion" and CN's reassignment to a lower
position could not be considered a "return to a former
The court agreed with Younger that CN's reassignment
was not a lateral transfer but a demotion. This demotion
amounted to a fundamental breach of Younger's employment
contract as the differences between the positions "amounted to
substantial changes to the employment contract".
This case stands as a reminder that employers must take care
when reassigning their employees and ensure that transfers which
are done without an employee's consent or without reasonable
notice are of a lateral nature rather than a demotion.
While we have previously discussed
here how the Courts will provide some deference to employers,
it does not extend to situations where the employee's new
position is a substantial demotion.
Employers may also want to consider making promotions
subject to an express probationary period, during which the
employee can be returned to his/her previous or a comparable
position without a fundamental breach of contract.
Unfortunately, reasonable accommodation for employees in the workplace continues to be the source of significant litigation and even today we continue to see outrageous examples of employers behaving badly.
We are now beginning to see reported cases involving charges and subsequent fines laid against employers for failing to provide information, instruction and supervision to protect a worker from workplace violence.
On October 13, 2016, the Supreme Court of Canada denied leave to appeal an Ontario Court of Appeal decision which ordered an employer to pay a former employee 37 months of salary and benefits following termination.
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).