July 15, 2014

Employer’s Unreasonable Increase in Duties and Response to Employee Concerns Constitutes Constructive Dismissal

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Often constructive dismissal cases involving a change in duties arise from an employer’s unilateral reduction in an employee’s duties. However, Damaso v. PSI Peripheral Solutions Inc., 2013 ONSC 6923 is just the opposite. An employee alleged that an employer’s unilateral increase in his duties resulted in his constructive dismissal.

After working as a service technician for ten years, Damaso was appointed as the employer’s IT Administrator in 2009. This required him to take on duties in addition to his prior responsibilities without receiving any corresponding increase in salary.

In early 2010, approximately one year after the changes were imposed, Damaso began to ask the employer for a pay raise to compensate him for the additional duties. He also complained that he was overworked. In February, 2011, Damaso again outlined his concerns regarding workload and salary. The employer took the position that they had not increased his duties beyond his initial job description and refused to give him a raise.

In April, 2011, Damaso took the position that he would not perform the new duties that were imposed in 2009 because he was overworked. In May, 2011, the employer gave Damaso a termination letter which provided him with 12 months’ working notice. It set out the job responsibilities that Damaso was to perform, which included the new duties that were imposed in 2009. Damaso’s family doctor then placed him on disability leave until September, 2011.

On September 26, 2011, Damaso wrote to the employer and took the position that he had been constructively dismissed.

In the constructive dismissal action, the employer put forward three arguments: (1) there were no changes in Damaso’s duties; (2) in the alternative, Damaso had condoned the changes by performing the new duties without objection between 2009 and 2010; (3) in the further alternative, Damaso fully mitigated his damages by continuing to work for the employer between January, 2010 (the date of his first objection to the duties) and May, 2011. The Court rejected the employer’s arguments and found that Damaso had been constructively dismissed.

The Court accepted that the employer had some latitude to make changes to Damaso’s job description as its business changed and evolved. However, the employer did not have the right to demand that Damaso perform all of his original duties and all of the new duties which were not contemplated in his job description. The Court concluded that the addition of the new duties overburdened him to the extent that he was unable to complete all of the required tasks.  

Interestingly, the Court found that the constructive dismissal did not take place in 2009 when the duties were first imposed, but in May, 2011 when the employer provided Damaso with 12 months’ working notice of termination. In the termination letter, the employer stated that Damaso would be required to perform all of his original duties and all of the new duties. The Court found that “this demand took place notwithstanding the fact that Damaso had reasonably indicated that he could not perform all of these duties.” Further, the employer had changed the passwords for its internal computer system, which prevented Damaso from performing the new duties unless someone else logged him into the system. The Court held that it was unreasonable to not only demand that he continue to perform both the original and the new duties, but also that he perform the new duties without having independent access to the computer system. Further, the Court held that the employer’s hostility towards Damaso, and the demand that he perform the new duties without the necessary passwords, resulted in a humiliating situation to Damaso and reflected a clear demotion.

The Court found that Damaso was entitled to damages equivalent to 12 months of pay in lieu of notice of termination.

This case is a good reminder to employers to be cautious both in making changes to an employee’s duties and in responding to the employee’s concerns regarding the changes. Rather than finding that the initial imposition of new duties constituted constructive dismissal (which would have raised issues regarding the employee’s condonation of the changes), the Court found that the dismissal occurred 2.5 years later. The Court expressed disapproval for the employer’s hostile conduct and the additional limitations it imposed on the employee’s ability to perform his duties. This raises the suggestion that perhaps if the employer had been more reasonable in its negotiations with the employee, it may had a stronger defence to the claim of constructive dismissal.

For more information, please contact Alison Bird at coxandpalmer.com.


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