Employer's actions constituted constructive dismissal, says BC Supreme Court
The Supreme Court of British Columbia recently addressed a case where a worker claimed constructive dismissal after returning from medical leave to find significant changes to her role, workspace, and reporting structure. The worker alleged these changes constituted a fundamental breach of her employment contract.
The employer, an Osoyoos Indian Band (OIB), denied these claims, maintaining that no constructive dismissal had occurred and that the worker had simply quit her position voluntarily.
The case required the court to determine whether the employer's actions during and after the worker's medical leave met the legal threshold for constructive dismissal.
The worker began her employment with the OIB in April 1999 as a receptionist. By 2004, she had advanced to an executive assistant role serving the band administrator, Chief, and Chief Financial Officer.
After completing a four-year program on First Nations property taxation at Thompson Rivers University, she became certified as one of the First Nations tax administrators in Canada and officially became the OIB's first tax administrator in 2009, a position formalised by Band Council Resolution in 2011.
The worker's responsibilities grew substantially as the number of properties subject to taxation on OIB lands increased over the years. In 2015, she requested additional help during the busy tax season (May through July), and in 2016 and 2017, temporary staff were provided to assist her.
In July 2017, the worker unexpectedly went on medical leave for emergency surgery. Upon her return in September 2017, she discovered the OIB had posted a job for a "tax administrator trainee" without consulting her, despite her being the Tax Department head. When questioned, the Chief assured her the new employee would be "a floater, assisting her in her busy times and the accounting department during their busy times."
The successful candidate for the trainee position was the sister of the human resources director, who declared a conflict of interest in the hiring process. The court found evidence that despite this declared conflict, the human resources director remained involved in Tax Department matters throughout the relevant period.
By early 2018, the Chief began pressuring the worker to accelerate the trainee's training on property tax matters. The worker was excluded from emails between the Chief and other staff discussing these training issues, though she was aware of the mounting pressure.
In March 2018, the trainee sent complaints about the worker to management, claiming there was "lateral violence with no repercussions" and that she was "not an assistant at the beck and call of others." These complaints were never shared with the worker, preventing her from responding.
The increasing stress led the worker to take medical leave again in April 2018 on her doctor's advice. While on leave, Great-West Life (GWL), her disability insurance provider, assigned Farooq Mian, a rehabilitation consultant, to facilitate her return to work through a graduated return to work (GRTW) program.
Despite Mian's repeated attempts to contact the OIB's representative between November 2018 and June 2019 to arrange the GRTW plan, there was no response for seven months.
When the worker finally began her return in July 2019, she and a registered occupational therapist found the trainee occupying her workspace. The worker was assigned to a temporary table with filing duties instead of her tax administrator responsibilities.
The rehabilitation consultant advocated for the worker, stating in emails to the employer: "[The worker] needs a desk: preferably her own." The OIB representative responded that this wasn't possible as "her desk is currently the only connection for taxation programs, phone calls from customers, taking payments, data input all that [the worker] is unable to do." Mian repeatedly clarified that the worker "is not there to observe" and "should be engaging in productive work," emphasising that "the goal is to increase her job duties."
Throughout her GRTW program, the worker remained without proper access to tax systems. By the end of the program, she learned her reporting structure had changed—she would now report to a manager rather than directly to the Chief. In September 2019, she was told her duties would be split with the trainee, with geographic territories divided between them.
The court discovered that during the worker's medical leave, the trainee had been appointed as the tax administrator by Band Council Resolution, effectively replacing the worker.
Justice Potter noted: "I find as a fact that [the trainee] was appointed to the position of the [employer's] tax administrator at some time during [the worker's] leave (April 1, 2018) and her return to work (July 10, 2019). She replaced [the worker] in that position."
The court determined the worker had been constructively dismissed under the first branch of the test from Potter v. New Brunswick Legal Aid Services Commission, finding:
"[The worker] was constructively dismissed on the first branch of the test for constructive dismissal: an express or implied contract term was breached and it was sufficiently serious to constitute constructive dismissal. [The worker] was removed from her position as tax administrator and replaced by [the trainee] while [the worker] was on leave."
The court awarded the worker 24 months of notice as damages, considering her age (52), length of service (20 years), specialised position, and the limited availability of similar employment. Additionally, $50,000 in aggravated damages was granted based on the OIB's bad faith conduct.
"In all the circumstances, I find that the [employer's] conduct toward [the worker] was not candid, reasonable, honest or forthright and that it engaged in conduct that is unfair and in bad faith by being untruthful, misleading and unduly insensitive," the judge concluded, reinforcing that employers must act with integrity throughout the employment relationship.
