How can an employer circumvent a constructive dismissal claim when they need to relocate an employee?

How can an employer circumvent a constructive dismissal claim when they need to relocate an employee?

As an employer, it is sometimes difficult to foresee the possible challenges your workplace may encounter. There could be an instance where the conditions of the workplace could force an employer to make changes, which could include relocating certain employees.

The result of addressing relocation with an employee can be somewhat unpredictable. When asking an employee if they are willing to relocate, they must consensually accept the offer, and if they don’t, it could lead to a potential constructive dismissal claim.

An employee would file this claim if the relocation presented considerable changes from what was initially outlined in the employee’s employment contract. If there are either serious changes to the terms and conditions of the new role, the move is not consensual between the employer and employee, or the employee feels obligated to relocate because of workplace culture, filing a constructive dismissal claim is reasonable.

It is possible for employers to avoid these constructive dismissal claims if they establish a mobility clause, outline a relocation policy for staff, initiate consensual negotiations with their employee, or can parallel the employee’s current role at the new location.

First, an employer can add a mobility clause in their employee’s employment contract. A mobility clause would outline that the employer has the right to relocate the employee if it is reasonable under the circumstances and necessary for the company. A mobility clause could be important because once an employee signs their employment contract, they would be agreeing to this clause, and thus, agreeing to a possible relocation in the future.

Further to the mobility clause, the employer could create a relocation policy that is accessible to every employee. It could include information like the kind of accommodations provided if relocated or paying for certain costs that could make a move unsettling for an employee.

If the employer has not written a mobility clause in their employees’ employment contracts, but still require relocation, it may be beneficial to enter consensual negotiations with the employee. In this case, the employee would have the opportunity to accept or decline certain aspects in the relocation package.

When an employee files a constructive dismissal claim it is on the basis that the terms of their employment contract would change considerably upon moving. Even if the employee has accepted the mobility clause, the new job must at least match the terms and conditions of the employee’s current role. It is the responsibility of the employer that they ensure compensation is at least equal to what the employee is paid at present and their work responsibilities have not changed.

If you are an employer who wants to create a mobility clause and relocation policy, please contact KCY at LAW by filling in an online consultation request or contact us by phone at 905-639-0999 to book your consultation today.