Remote Work & Constructive Dismissal: Protecting Your Business When Recalling Employees

As Canadian employers shift away from remote work, many face a hidden legal risk: constructive dismissal. If you're planning to bring employees back to the office, even part-time, it’s critical to understand how employment contracts, workplace expectations, and human rights obligations intersect — especially in a post-pandemic world where remote work became the norm.

In this article, we’ll unpack what constructive dismissal means in the context of remote work and how you can reduce your exposure through updated employment contracts and proactive communication.

What Is Constructive Dismissal?

Constructive dismissal occurs when an employer unilaterally changes a fundamental term or condition of employment without the employee’s consent. If the change is significant — and the employee resigns as a result — courts may treat the situation as if the employee was wrongfully dismissed.

In Canada, courts have already recognized that requiring a remote employee to return to a physical workplace — especially without a prior agreement — can amount to constructive dismissal in certain circumstances.

Common examples include:

• Requiring full-time in-office attendance after 2+ years of remote work

• Changing the employee’s city or office location

• Reducing hours, altering job responsibilities, or changing schedules

• Failing to accommodate remote work needs (e.g., disability or caregiving)

Why Remote Work May Become a “Term” of Employment

During the COVID-19 pandemic, many employees worked remotely for extended periods. If no written agreement clarified that remote work was temporary or subject to change, a court may find that remote work became an implied term of the employment relationship.

That means employers can’t always unilaterally demand a return to office — especially if:

• The remote arrangement lasted more than a year

• The employee’s performance was strong while working remotely

• The employee relocated based on the remote nature of their role

• The employer never specified in writing that the role was temporary or hybrid

In such cases, a forced return to office without proper notice or consent can give rise to a constructive dismissal claim — and expose employers to common law notice, ESA termination entitlements, or human rights complaints.

What the Law Says (And Why Contracts Matter)

Canadian courts expect employers to define the terms of employment clearly and in writing. If the employment contract is vague or silent about work location, the law will often side with the employee.

To reduce risk, contracts should explicitly state:

• Whether the role is remote, hybrid, or in-office

• That remote work may be temporary or subject to change with notice

• The employer’s right to determine or alter work location

• Any requirements for in-person meetings or office attendance

If this isn’t spelled out — and you force a change — you may be on the hook for severance, benefits continuation, and potential reputational harm.

What Employers Can Do Right Now

Here’s how you can protect your business while transitioning back to in-office or hybrid work:

1. Review Employment Agreements

Ensure all new and existing employees have updated contracts that reflect your remote work policies. Include language about flexibility, expected location, and your right to make changes with reasonable notice.

2. Give Reasonable Notice of Change

Even if your contract allows flexibility, you must still provide reasonable notice of a change in work location — typically weeks or months, not days.

3. Offer Alternatives or Accommodations

Explore hybrid arrangements, phased returns, or role adjustments. If the employee has a medical or caregiving reason, consult your legal advisor about your duty to accommodate.

4. Document Everything

Communicate changes in writing, ideally through updated agreements or addendums. Keep records of when changes were discussed and agreed upon.

5. Use Legal Templates Designed for Canada

Avoid generic contracts that don’t reflect ESA requirements or recent legal trends. Instead, use lawyer-reviewed templates that are province-specific and up-to-date.

Rethinking Your Return-to-Office Policy?

Before you issue a return-to-office mandate, make sure your contracts and practices are in step with Canadian law. With HireEase, you can confidently manage change — without triggering legal risk.

Download our free Remote Work Clause Template or explore our full library of employment agreements today.