Verbal WFH arrangement was an express contract term, BC Court of Appeal rules
A British Columbia employer's decision to order a longtime director back to the office five days a week has cost it 19 months' pay in lieu of notice, after the BC Court of Appeal ruled on May 11, 2026, that her verbal work-from-home arrangement was a binding term of her employment contract. In reasons penned by Chief Justice Marchand, the court dismissed Cressey Construction Corporation's appeal and upheld a finding that the company constructively dismissed Tracy Parolin, an 18-year employee, when it revoked her remote work privileges without reasonable notice. The ruling sharpens the stakes for Canadian employers rolling out return-to-office mandates where remote arrangements have quietly hardened into contractual rights over years of informal practice.
Parolin started at Cressey in 2005 as a Development Manager and was promoted to Director of Marketing in April 2018. Following the birth of twins in 2012, one with a significant health issue, she returned to work in April 2013 on a four-day-a-week schedule that allowed her to manage childcare. Once her children started kindergarten in 2017, she had flexibility to pick up and drop off her children five days a week.
When the pandemic hit in March 2020, Cressey employees worked from home. Within a few months, they returned to the office. Parolin did not, citing her child's health.
She continued working from home with the approval of two successive supervisors. The trial judge found that in 2021, after the departure of her previous supervisor Mr. Turcotte, Executive Vice President Mr. Lammam told her "she did not need to work at the office, as he knew she was getting the work done and the location did not matter." In June 2021, Lammam helped set up her home office. By March 2023, she had moved to full-time hours, still working from home.
The meeting that ended an 18-year career
On May 10, 2023, Parolin met with Vice President of Development Mr. Kendall to discuss a long-requested raise. Kendall offered her a $1,400 annual increase, bringing her salary from $93,600 to $95,000, and told her that her role was more akin to a Marketing Manager than a Marketing Director. He also directed her to return to the office Monday to Friday, 9 a.m. to 5 p.m.
Parolin treated the directive as constructive dismissal. Her last day was May 17, 2023. At trial, evidence showed Marketing Directors at two other companies were being paid over $125,000, consistent with her request for $130,000.
The Court of Appeal held that "Cressey constructively dismissed Ms. Parolin when it mandated she return to the office full-time five days a week without providing her reasonable notice. In the circumstances of this case, Cressey's revocation of Ms. Parolin's ability to work from home was a unilateral change to an essential term of her employment contract and amounted to constructive dismissal."
Notably, the court found the work-from-home term was an express oral term of the employment contract, not an implied one, making any errors the trial judge may have made about "flexibility" or "demotion" immaterial to the outcome.
In-office work not comparable employment
After leaving Cressey, Parolin did not apply for other jobs. Instead, she pursued three business ventures: Sova Homes, a residential development business; Maro Design, an AI interior design product she paused due to technological limitations; and Tech Safe Kids, an interactive digital literacy platform for young people accepted into a Centre for Digital Media program. None had generated revenue by the time of trial.
Cressey argued she failed to mitigate by not seeking comparable employment. The court rejected that argument, finding it was open to the trial judge to conclude her business ventures were a reasonable form of mitigation given her extensive experience in the development sector and the fulsome efforts she made.
In any event, the court held, Cressey had failed to show comparable employment was available: "The positions Cressey pointed to were not comparable because they required in-office work. In my view, it would be unfair to require Ms. Parolin to seek out and accept full-time in-office work when she had bargained with her employer to work from home, because of her childcare-related needs, and it was the unilateral breach of that term that constituted her constructive dismissal."
See Cressey Construction Corporation v. Parolin, 2026 BCCA 199
