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Constructive Dismissal: Does Not Always Require a Salary Reduction

Posted On: January, 21 2015

In this recent Ontario Superior Court decision, Justice MacDougall considered the case of a manager who was demoted in title and who had his direct reports removed from his supervision.  The issue was whether this constituted constructive dismissal, especially considering that his job remained unchanged in several important ways, and his pay was not affected.

Blight v. Nokia Products Ltd., [2012] O.J. No. 1455, 2012 ONSC 2093

Mr. Blight, the Plaintiff, was a 12 year employee of the Defendant company, Nokia Products Ltd.  He was a manager who had 4 direct reports.  Issues arose between Mr. Blight and his employer, particularly around Mr. Blight’s managerial style with his 4 reports.  There was a dispute between the Plaintiff and Nokia about dismissing a member of Mr. Blight’s work group – the Plaintiff wanted to dismiss the person, but the Defendant disagreed.  It appears that Nokia eventually made the decision that Mr. Blight lacked the interpersonal skills necessary to be an effective manager, but that his technical ability was nevertheless valuable.

Nokia proceeded to change Mr. Blight’s title and job description.  The employer permitted him to retain the term “manager” in his title, but changed his job description insofar as he would be solely tasked with technical work and would no longer have any direct reports.  His compensation remained unchanged, and in all other respects his employment continued as before.

Mr. Blight objected to this change in title, and when it became clear that the employer had no willingness to reverse its decision, he unilaterally left work and commenced an action claiming that he had been constructively dismissed.

After a 5-day trial, the Court decided in favour of Mr. Blight that he had been constructively dismissed:

[49] I find that Ballentyne, representing Nokia, had made the decision that Blight’s position with Nokia was going to be changed. I also find that the change in his position did constitute, in my view, a substantial unilateral change to the term of his employment contract. I agree that this change would mean a loss of prestige and status even if he was to maintain the title of “manager” and receive the same compensation.

This decision is noteworthy because it demonstrates that Ontario courts are willing to find constructive dismissal even in cases where there has been no change to an employee’s compensation.  On the facts of this case, the Plaintiff made it abundantly clear that being a manager in practice (rather than title) was important to him, and that he wanted to retain his staff.  When his position was changed over his objections, the Plaintiff was justified in feeling a loss of prestige and status, and this was enough to find that he had been constructively dismissed.


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