BC Supreme Court sides with remote worker after decade-long set-up suddenly ended
The Supreme Court of British Columbia recently dealt with a constructive dismissal dispute between a marketing professional and her employer of 18 years. The worker argued that unilateral changes to her working arrangements constituted a breach of her employment contract.
The worker claimed that flexible work hours and the ability to work from home had become fundamental terms of her employment contract over time. She also contended that her employer had effectively demoted her by treating her director-level position as a manager-level role when considering her salary.
After being directed to return to the office full-time on a fixed schedule and receiving only a minimal salary increase, the worker concluded she had been constructively dismissed and sought damages based on a notice period of 20 months.
The worker started with the real estate developer as a development manager in 2005. In 2012, she took maternity leave until April 2013. When she returned, she arranged flexible working hours to accommodate childcare needs for her twin daughters, one of whom had health issues.
During the COVID-19 pandemic in 2020, the worker began working from home. While most employees eventually returned to the office, she continued working remotely with company approval. In June 2021, the employer even approved her setting up a home office and purchasing equipment.
The court found this flexibility had become a fundamental term of her employment: "I conclude [the worker] has established that, upon her return from maternity leave in 2013, her employment contract included a term providing flexibility in her work hours to accommodate her childcare commitments."
In 2018, the worker was promoted to director of marketing and provided with a formal job description. She performed all required duties in that role. Despite repeated requests for a salary increase over five years, the company failed to properly address them.
In May 2023, during a meeting with the vice president of development, she was told she would receive only a minor increase from $93,600 to $95,000. The vice president indicated her role was more comparable to a marketing manager position, despite her having performed the director role for years.
At this same meeting, she was directed to return to the office from 9 a.m. to 5 p.m., Monday to Friday. The court accepted the worker's account of this meeting and concluded:
"I conclude [the employer's] direction to work back in the office from 9 a.m. to 5 p.m., along with the small salary increase consistent with a Marketing Manager position, was a unilateral change to a term of [the worker's] contract which substantially changed the contract and resulted in her constructive dismissal."
The court emphasised that employers cannot unilaterally change fundamental terms of employment without reasonable notice, even when those terms are established through practice rather than written agreement.
The worker's flexible arrangement had been in place for ten years with employer knowledge and approval. This arrangement had become an oral term in her contract that couldn't be changed without proper discussion or notice.
The court stated: "I have concluded that a term of [the worker's] employment contract was her ability to work flexible hours at home, due to childcare commitments... I have therefore found [the worker's] flexible work hours and location to be oral terms in her contract of employment."
After her constructive dismissal, the worker started her own business ventures rather than seeking comparable employment. She first attempted small residential development projects, then shifted to an AI-based interior design product, and finally focused on an interactive learning platform for teens about online safety.
The employer argued she failed to mitigate damages by not looking for comparable employment. They pointed to available positions at other companies and questioned her lack of business experience.
The court determined her entrepreneurial efforts constituted reasonable mitigation: "It is evident from all the above that it was reasonable, in these particular circumstances—which demonstrate robust efforts with a potential of success—for [the worker] to start her own business."
The court awarded 19 months of notice, reflecting her 18 years of service, senior position, and age (55). The employer had argued for a notice period at the lower end of the 14-18 month range.
In assessing mitigation, the court referenced the Court of Appeal decision in Forshaw: "The duty to 'act reasonably', in seeking and accepting alternate employment, cannot be a duty to take such steps as will reduce the claim against the defaulting former employer, but must be a duty to take such steps as a reasonable person in the dismissed employee's position would take in his own interests."
The court found she acted reasonably in pursuing business ventures related to her expertise: "In this case, unlike that of Hart, the evidence establishes that [the worker] made fulsome efforts to start a business in an industry she is very familiar with in both of her first endeavours."
The court declined to award punitive damages, finding insufficient evidence of malicious intent: "While I conclude [the worker] was treated poorly by her employer, I do not find that this was done with malice, but rather with a careless, dismissive attitude."
This case demonstrates how workplace flexibility arrangements, particularly when established over years, can become binding terms of employment that cannot be unilaterally changed without notice or proper consultation.