A comforting decision for employers reorganizing their workplace

A recent decision¹ has set the record straight by reaffirming a principle that some decision-makers at the Administrative Labour Tribunal (ALT) tend to want to set aside: section 124 ALS does not create the right to a job for an employee who was actually dismissed for economic or organizational reasons. In fact, the Quebec Superior Court confirmed that in the case of an actual dismissal, there is no obligation, by virtue of statute law or case law, to try to find another position within the company for the employee who was dismissed.

The facts

A program to increase performance and efficiency in all the employer’s business units (hereinafter referred to as the PIP) was implemented wherein the plaintiff’s supervisor was asked to analyze all the positions under his responsibility. Due to new processes resulting in reduced workforce needs in his department, he was asked to abolish two positions in his group.

It was in this context that the plaintiff learned her position would be abolished and she would be dismissed. She was offered a severance package and was provided with career transition services during the severance period.

More than five months went by between the time the offer was made to the plaintiff and the time she stopped receiving a salary. She ended up refusing the employer’s offer and filed a complaint under section 124 ALS, alleging that her termination was in fact constructive dismissal rather than a dismissal for economic reasons or due to an administrative reorganization.

The decision

The Superior Court reversed the ALT’s judgment under which the complaint pursuant to section 124 ALS was allowed. In this case, the employer was clearly able to show that the decision to abolish the plaintiff’s position was made for organizational reasons. As evidence of this, among other significant things, was the fact that as a consequence of the PIP, several other positions were abolished, including some at a higher level than that of the plaintiff’s supervisor.

According to the Superior Court, once it has been determined that the termination is the result of an actual dismissal, the ALT must stop its analysis and the recourse under section 124 ALS must be dismissed. It is unreasonable for the ALT to continue reflecting on it and to [translation] “create a duty for the employer to try to find the employee another position, either in the same organization or within another related entity, where the failure to do so constitutes a constructive dismissal².”

The take-away

In terms of “best practices,” it might of course be advisable for the employer to try to find the employee whose position was abolished for economic or organizational reasons another position within the company. However, as the Superior Court has pointed out in this case, it is not a duty prescribed by Quebec law and this decision confirms it does not need to be strictly respected. It remains to be seen how decision-makers who currently take the reassignment into consideration when analyzing the legitimacy of the dismissal will react and whether they will adopt the Superior Court’s reasoning.