QUICK ANSWER
Constructive dismissal happens when an employer makes your working conditions so unbearable — or changes your job so significantly — that you are essentially forced to quit. In Ontario, the law treats this as a dismissal. That means you are entitled to the same compensation as someone who was fired — even though you were the one who resigned.
What is constructive dismissal?
Constructive dismissal — sometimes called “constructive discharge” — is a legal concept that recognises a simple truth: an employer does not have to use the words “you are fired” to effectively end someone’s employment. If an employer makes the job intolerable or unrecognisable compared to what was originally agreed, the employee may be justified in walking away — and in claiming full termination compensation when they do.
The Supreme Court of Canada has described constructive dismissal this way: it occurs when an employer, without the employee’s consent, makes a unilateral change to an essential term of the employment contract that substantially alters that term.
Put simply — if your employer changed the deal without your agreement, and the change is serious enough that a reasonable person in your position would feel they had no choice but to leave, that is constructive dismissal.
Common examples of constructive dismissal in Ontario
Constructive dismissal does not always look dramatic. It often happens gradually — through a series of changes that together make continued employment unreasonable. Common examples include:
Significant pay cut
Your salary is reduced without your agreement — even by 10 to 15 percent. Courts have found cuts of this size to be constructive dismissal.
Demotion or role stripping
Your title, responsibilities, or authority are reduced without cause or consent — leaving you doing a fundamentally different, lesser job.
Hostile or toxic environment
Your employer allows — or participates in — ongoing harassment, bullying, or humiliation that makes showing up to work unbearable.
Forced relocation
You are transferred to a new city or location without your agreement — especially when it significantly disrupts your life or commute.
Hours drastically cut
Your scheduled hours are dramatically reduced without your agreement — changing your income and the nature of your employment without consent.
Being pressured to resign
Your employer tells you outright to “think about resigning” or creates conditions designed to push you out — rather than simply firing you and paying what is owed.
Is constructive dismissal illegal in Ontario?
The short answer is: yes — constructive dismissal is unlawful in Ontario. It is treated as a breach of the employment contract by the employer. Under Ontario’s Employment Standards Act, 2000 and common law, an employer cannot unilaterally impose significant changes to the terms of employment without the employee’s agreement. When they do, and the employee is forced to leave as a result, the employer is legally responsible — just as if they had fired the employee outright.
Constructive dismissal is also recognised under the ESA itself. The Act makes clear that a significant reduction in wages or hours — specifically a reduction of more than 15 percent — can constitute a constructive dismissal entitling the employee to termination and severance pay.
Additionally, if the constructive dismissal is connected to a protected ground — such as disability, pregnancy, age, or race — it may also constitute a violation of the Ontario Human Rights Code, opening the door to additional damages beyond severance.
Important distinction: Constructive dismissal is a civil legal claim — not a criminal one. Your employer will not be arrested. But they can be ordered by a court to pay you significant compensation — sometimes equivalent to many months of salary — for pushing you out rather than letting you go properly.
How to Prove Constructive Dismissal
Proving constructive dismissal in Ontario requires showing two things: that your employer made a significant unilateral change to your employment, and that a reasonable person in your position would have felt they had no real choice but to leave. Here is what that looks like in practice.
Not every workplace change amounts to constructive dismissal. The change must go to the heart of the employment relationship — your pay, your role, your location, or your working conditions. Minor changes or temporary inconveniences generally do not qualify.
Evidence to gather: Your original employment contract, offer letter, any written changes to your role, emails announcing restructuring, and records of your salary before and after any reduction.
If you agreed to the change — even silently, by continuing to work without objecting — you may lose the right to claim constructive dismissal. This is why acting quickly and objecting in writing is so critical. If you keep working for too long after a significant change without raising the issue, courts may find that you accepted the new terms.
Evidence to gather: Written objections you sent to your employer, emails or messages where you raised the issue, records of any meetings where changes were discussed, and proof that you did not consent in writing.
Ontario courts apply an objective test — not just how you personally felt, but whether a reasonable person in your exact situation would have concluded the employment relationship was fundamentally broken. This is why documenting everything matters so much: the more concrete and factual your record, the stronger the case.
Evidence to gather: A written account of events with dates, witness statements from colleagues if available, medical records if the stress affected your health, and HR communications or complaints you filed internally.
If you continue working for months or years after the change without taking any action, courts may find that you accepted the new terms. There is no fixed deadline — but generally, the sooner you object and seek legal advice after a significant change, the stronger your position will be.
How to File for Constructive Dismissal in Ontario
Filing a constructive dismissal claim in Ontario involves several steps. The order in which you take them matters enormously — doing things in the wrong sequence can weaken or even destroy an otherwise strong claim.
(1) Do not resign yet — speak to a lawyer first
This is the most important instruction on this page. If you resign without first getting legal advice, you risk losing your right to claim constructive dismissal entirely. How you leave — and what you say when you leave — is critical. An employment lawyer will tell you exactly what to do before you take any action.
(2) Gather and preserve all your evidence
Before you lose access to company systems, collect and save your employment contract, pay stubs, emails about changes to your role, performance reviews, and any records of harassment or hostile conduct. Write a detailed account of what happened and when. This becomes the foundation of your claim.
(3) Object in writing to the change
Send a clear written notice — an email is fine — to your employer stating that you do not accept the change and that you are working under protest. This protects your right to pursue a constructive dismissal claim while you remain employed. Do this under a lawyer’s guidance so the wording is right.
(4) Choose how to pursue your claim
You have three options. First, negotiate directly — your lawyer sends a demand letter and many cases resolve without going to court. Second, file an ESA complaint with the Ministry of Labour for the statutory minimum amounts. Third, file a civil lawsuit in Ontario court for full common law notice — which is almost always the largest amount. Your lawyer will advise which route is best for your situation.
(5) Apply for Employment Insurance immediately
Apply for EI at Canada.ca as soon as your employment ends. Do not wait for your legal claim to resolve. A constructive dismissal qualifies you for EI — you were not a voluntary quit in the eyes of Service Canada when you were forced out.
(6) Act within the two-year time limit
In Ontario, you generally have two years from the date of the constructive dismissal to file a civil claim. Do not wait. The sooner you act, the stronger your position — evidence is easier to gather, and your employer is less likely to have closed records or moved key witnesses on.
What you are owed if constructive dismissal is established
If your constructive dismissal claim succeeds, you are entitled to the same compensation as any dismissed employee — and potentially more if the employer behaved particularly badly.
● Termination pay — at minimum one week per year of service under the ESA, up to eight weeks; often much more under common law
● Severance pay — up to 26 additional weeks if you have five or more years of service and your employer has a large payroll
● Common law reasonable notice — often one month per year of service, based on your age, role, length of service, and the job market
● Damages for bad faith — if your employer acted in a particularly callous or humiliating way, courts can award additional compensation beyond notice
● Human rights damages — if the dismissal was connected to a protected ground, a separate human rights claim may entitle you to additional compensation
The bottom line: Constructive dismissal is one of the most complex — and most misunderstood — areas of Ontario employment law. Many employees who were genuinely pushed out never claim what they are owed simply because they did not know they had a case. If your employer has made your job unrecognisable, your pay has been cut without your consent, or you have been treated in a way that no reasonable person would accept — you may have a constructive dismissal claim worth pursuing. The first step costs nothing. Speak with an Ontario employment lawyer today.
