Depending on the needs of your business, you may wish to relocate your staff within the city, or the province or even outside it.
To do so, it is crucial that your employment contract gives you, the employer, the right to change major terms of employment like the job location.
Asking an employee to relocate to another location without any contractual right is risky. If the worker does not consent, you may not just lose a good employee, but you may also expose yourself to constructive dismissal claims.
Constructive dismissal
When an employer alters key terms of employment (salary, work hours, role, location) without any contractual rights or the employee's consent, it is a constructive dismissal.
It also includes cases where an employer pushes an employee to resign by creating an intolerable work environment.
In both cases, it becomes a termination of the employment. The worker is then entitled to severance pay.
How can I avoid a constructive dismissal claim?
Include a mobility clause in your employment contract
It is not constructive dismissal if your job contract gives you the right to relocate the employee for legitimate business needs.
Make sure you add a mobility clause to your work contracts and develop a clear policy for relocating staff. Your policy should cover the possible reasons for relocation (short-term or long-term), details on relocation assistance, what moving expenses would be reimbursed, and so on.
Include the policy in your employee handbook and share it with your staff. If the employee is aware from the start that relocation may be part of the job, they are less likely to object when it happens.
Get consent by negotiating a transfer
That’s another option if you don’t have contractual rights and need to relocate an employee. Talk to the employee and negotiate the terms of the transfer. Find out what perks or benefits would persuade the employee to relocate. Once the worker consents, alter the existing employment contract to reflect the new arrangement.
Offer similar employment terms in the new location
Make sure the role in the new location does not offer a lower salary or benefits. If it does, it’ll make a case for constructive dismissal even if you have a mobility clause in your work contract. The terms of employment after the transfer should be equivalent to those of the original job, if not better. You could also offer the employee alternative relocation options if that is possible.
Some other things to consider
Forcing an employee to relocate is bad for your business. Without contractual rights, it is also fraught with legal risks. If you do have a mobility clause in your job contract and the employee still refuses to relocate without giving a valid reason for the refusal, it could be considered as job abandonment.
The best course of action, always, is to talk to the employee and find out their reasons for refusal. This may help you negotiate a deal that works for both of you.
Duty to accommodate
Under the human rights law, employers have a duty to accommodate staff to the point of undue hardship. This applies to needs that relate to grounds of discrimination (which include ground of family status and disability). If an employee's refusal relates to a ground of discrimination, you could be exposing yourself to litigation by pushing them to relocate.
Need help developing a relocation policy?
Our experts can help you develop company policies as well as with any other HR, health and safety, or employment advice you need. See how we have helped other small and medium businesses get their business compliant with provincial legislation.
