Appearances:
| Lucy
Pelletier, on her own behalf. Dan Kwochka, lawyer, Wayne Kaye and Cameron Sangwais, counsellors, for Sakimay First Nations. |
The Assertions of the Parties
¶ 1 The appellant, Ms. Lucy Pelletier, states she was constructively dismissed from her position as band manager with the Sakimay First Nations, Grenfell Sask. Ms. Pelletier resigned her position with the Sakimay First Nations on August 15, 2001. However she states that the failure of the Band Council to extend to her the treatment accorded other Band employees and failure of the Band Council to acknowledge her entitlement to overtime payments constituted a constructive dismissal.
¶ 2 The respondent, Sakimay First Nations, assert that Ms. Pelletier resigned of her own volution. Further, that Ms. Pelletier was not entitled to any overtime payment based on the terms of her employment, its review of her hours worked and as a result of a decision in the Bands favour on her wage claim by a Human Resources Development Canada Inspector in Oct. 2001.
The Facts
¶ 3 Ms. Pelletier was initially hired as Band Manager on a term basis on June 29th, 1998. This term was to expire on Dec. 29, 1998. The Memorandum of Agreement setting out the terms of her employment deal with such matters as her hours of work, salary, travel expense reimbursements, leave of absence entitlements and that she would exercise her duties, "... under the parameters specified in the Personnel Manual and other Administrative policies of the Sakimay First Nation". While the matter of overtime entitlements is a central issue in this case, there is no mention of overtime in the Memorandum of Agreement. However, section 4.11 of the Sakimay Band Personnel Manual, to which she was subject, states in part, that "... any time over and above normal hours (requires) approval of the Band Administrator ... for a specific job or duty". Ms. Pelletier's performance as Band Manager was reviewed in November of 1998; her performance was rated as superior or outstanding on all evaluation factors.
¶ 4 As a result, Ms. Pelletier was offered the position of Band Manager on a permanent basis effective Jan. 1, 1999. Her letter of offer set out her salary, $34,500, that she would accumulate vacation and sick leave benefits and that her initial 6 month term appointment would serve as her probationary period. The letter specifically states that "There will be no overtime approved for any time worked beyond the usual (8:00AM to 4:00PM), 7.5 hours in each work day." It also requests her to submit a written acceptance of this job offer.
¶ 5 On Jan 27, 1999, Ms. Pelletier signed a letter "indicating your acceptance of these conditions ..." in accepting a full time position with Sakimay Administration. Conditions included a salary of $34,500, and that hours of employment "... will be from 8:00am to 4:00pm unless otherwise indicated."
¶ 6 On Jan. 25, 1999, a revised job description for the position of Band Manager was approved. This revised description was reviewed and acknowledged by Ms. Pelletier on Jan. 27, 1999. That revised description says in part that, "Under the direction of the Sakimay Chief and Council, the Band Manager will perform the following duties ..." In effect, she reported and took direction from the Chief and Band Council.
¶ 7 It would appear that on or about Jan 25, 1999, Ms Pelletier raised the matter of her entitlement to overtime with the Sakimay Band Council. This matter was "tabled for review" by the Band Finance Committee.
¶ 8 On July 13, 1999, Ms. Pelletier requested additional payment of $375 for assuming additional responsibilities of administering the health and social assistance functions of the Band for a period of 15 days. This extra payment was approved by Chief and Council on July 16, 1999.
¶ 9 On April 20, 2000, Ms. Pelletier requested she be paid additional compensation in the amount of $1800 for supervising and administering the Band social assistance program. Further, she agreed to reduce her overtime claim to 45 hours if this payment were made. This payment and arrangement was approved by Chief and Council on April 26, 2000.
¶ 10 Evidence at the hearing showed that in the 1999 - 2000 period, Ms. Pelletier was paid $1200 over and above her regular salary as band manager for the performance of additional duties.
¶ 11 In her annual evaluation of Dec. 14, 2000, Ms. Pelletier's performance was rated as "above average". It was recommended that her salary be increased from $34,500 to $38,395, retroactive to June 19, 2000. This evaluation included the following comments; "doesn't farm out tasks enough" and "puts too much on her workload thus accruing overtime".
¶ 12 In a meeting on Dec.19, 2000, Band and Council considered a recommendation to increase Ms. Pelletier's salary to $38,395. This recommendation was not approved with the mention that this matter would be reviewed after March 31, 2001 after all staff evaluations were completed.
¶ 13 In response on Dec. 12, 2000 Ms. Pelletier sought an appeal of this decision by the Chief and Council. Specifically, that she should not have to wait until staff evaluations were done to receive her increase. Failing resolution in her favour, she threatened legal recourse and if there was no positive outcome, that she intended to terminate her employment effective Feb. 2, 2001. On Jan 23, 2001 Chief and Council reviewed its original decision and granted Ms. Pelletier her wage increase of $ 38,395 retroactive to June 28, 2000.
¶ 14 On Jan. 23, 2001 Band Council approved the payment of $100 to Ms. Pelletier for work she claimed to have done on an overtime basis. The approving Council motion mentions that this overtime should have been approved in advance by Chief and Council and such overtime should be consistent with overtime provisions contained in the Band Personnel Manual.
¶ 15 On May 24, 2001 Ms. Pelletier, in a letter to Chief Gilbert Panipekeesick, requested a partial payout of 29.39 of her accumulated overtime hours. This would provide a payment of approximately $500. She also requested that she be permitted to take 1 week of her accumulated overtime in the form of leave from May 28 to June 1, 2001.
¶ 16 On June 06, 2001 Ms. Pelletier was informed in a letter of reprimand by the Chief and Council that her requests for payout and leave were denied. The letter goes on to state that Ms. Pelletier was absent without leave from May 28 through June 12, 2001. The letter further stated that while the Chief or a Band Councillor had approved her overtime occasionally in the past, such approvals in the future would require the prior approval of Chief and Council.
¶ 17 In response on June 9, 2001, Ms. Pelletier sought to grieve her letter of reprimand. She stated that her overtime issue had been outstanding for a considerable period of time. She claimed other employees had been paid out accumulated overtime and she was not being treated in the same manner. She acknowledged that when she made her request for time off in May, Chief Panipekeesick advised her that would not be a convenient time for the Band. She also acknowledged that permission to be absent was not granted prior to her taking her leave.
¶ 18 On June 18, 2001 the Sakimay First Nation completed a review of Ms. Pelletier's hours of work and specifically the overtime that had actually been authorized between June 1998 and May 2001. This study showed that when balanced against the overtime take off in lieu or used to balance her weekly hours, Ms. Pelletier had taken off approximately 155 hours that had not been approved.
¶ 19 In an August 15, 2001 letter to Ms. Pelletier, Chief and Council restated its earlier decision not to recognize any payout of accumulated overtime claimed by Ms. Pelletier and that no such overtime payments were owing.
¶ 20 On August 15, 2001 Ms. Pelletier submitted her resignation, effective August 31, 2001. The basic reason given was the failure of Chief and Council to acknowledge it was necessary for her to work extensive overtime hours to complete Band Council work. She further stated she viewed her resignation a constructive dismissal. Her resignation was accepted by the Chief and Council on Aug. 15, 2001
¶ 21 Ms. Pelletier filed a complaint of unjust dismissal on Aug.17, 2001. Intervention by a Human Resource Development Canada Inspector was not successful. Ms. Pelletier requested her termination be referred to adjudication under the Canada Labour Code on Dec.26, 2001. An adjudicator was subsequently appointed on Feb. 11, 2002.
¶ 22 In its response to her adjudication request, the Sakimay First Nations stated it viewed Ms. Pelletier as a manager and as such excluded from the unjust dismissal provisions as set out in Subsection 167 (3) of the Code. This provision reads as follows:
|
167 (3) Division XIV (Unjust Dismissal) does not apply to or in respect of employees who are managers. |
¶ 23 Section 242 (1) of the Code provides that an adjudicator has discretion to "... determine the procedure to be followed ..." at the hearing. Consequently the parties were informed by the adjudicator by letter of March 20, 2002 of the following:
|
... it is my decision that our hearing of May 8, 2002 should focus exclusively on whether the appellant was or was not a manager or performed managerial duties while employed with the Sakimay First Nations. If the appellant is found to have been a manager, that will end the matter. If the appellant is found not to have been a manager, the parties will have the opportunity to review their positions and possibly negotiate a mutually agreed resolution. In the interim, I will remain seized and will reconvene the adjudication to hear evidence on the issue failing a resolution by the parties. |
¶ 24 Thus the hearing of Wednesday, May 8, 2002 focussed solely on whether or not Ms. Pelletier functioned as a manager while employed with the Sakimay First Nations. The result of that hearing was a finding, issued on May 29, 2002 that Ms. Pelletier was not a manager and was entitled to pursue her claim of unjust dismissal under the Canada Labour Code.
¶ 25 The hearing of Nov. 27, 2002 ( originally scheduled on Aug 13, 2002 but cancelled at Ms. Pelletier's request for health reasons), focussed on her assertion that she was constructively dismissed by the Sakimay First Nations.
The Issues and Arguments
- Ms. Pelletier asserts she was constructively dismissed. She bases this on the fact that she had accumulated overtime in carrying out her duties, that this was known by her employer, that she sought compensation in the form of time off in lieu or payment and this was not acknowledged by the Sakimay First Nations to her satisfaction. As well she claims that others in her same situation were treated more favourably and that she was not permitted a fair hearing to express her concerns. She asserts that such action constituted a constructive dismissal. Given she is making this assertion, she is required to provide evidence and argument to support her claim.
- It is the contention of the Sakimay First Nations that Ms. Pelletier resigned of her own accord and there were no substantive alterations in the terms of her employment that would constitute a constructive dismissal. It is required to offer evidence and argument to support this assertion and it may choose to rebut Ms. Pelletier's assertions.
The Law on Constructive Dismissal
¶ 26 First, the question of whether term "unjust dismissal" or "dismissal" as found in Section 240 of the Canada Labour Code includes "constructive dismissal" has been answered in the affirmative. [See Note 1 below]
| Note 1: | See: HRDC Interpration: Constructive Dismissal, No: |
815-1-1PG-033, Sept 25, 2000.
¶ 27 Under this interpretation, constructive dismissal is defined as follows:
|
Note: in the following certain areas have been highlighted for emphasis | ||
| The unjust dismissal provisions in section 240 of the Canada Labour Code cover unjust constructive dismissals as well as those unjust dismissals made by the open unambiguous action of the employer. | ||
|
Unfortunately, the characterization of a constructive dismissal is not always straightforward. | ||
| Definition of Constructive Dismissal | ||
|
The phrase "constructive dismissal" describes situations where the employer has not directly fired the employee. Rather the employer has failed to comply with the contract of employment in a major respect, unilaterally changed the terms of employment or expressed a settled intention to do either thus forcing the employee to quit. Constructive dismissal is sometimes called "disguised dismissal" or "quitting with cause" because it often occurs in situations where the employee is offered the alternative of leaving or of submitting to a unilateral and substantial alteration of a fundamental term or condition of his/her employment. Whether or not there has been a constructive dismissal is based on an objective view of the employer's conduct and not merely on the employee's perception of the situation. | ||
| It is the employer's failure to meet its contractual obligations that distinguishes a constructive dismissal from an ordinary resignation. The seriousness of the employer's failure as well as the amount of deliberation apparent in its actions are also important factors. | ||
|
The employer's action must be unilateral, which means that it must have been done without the consent of the employee. If it is not unilateral, the variation is not a constructive dismissal but merely an agreed change to the contract of employment. Generally, if the employee clearly indicates non-acceptance of the new conditions of employment to the employer, there has been a constructive dismissal only if the employee leaves within a reasonable (usually short) period of time. By not resigning, the employee indicates his/her acceptance of the new conditions of employment. | ||
|
There have been rare and exceptional cases where courts have held that there has been a constructive dismissal even though the complainant remains in the employ of the employer. This includes, for example, cases where the employee continues to work under the new conditions in order to mitigate damages and either protests the new conditions explicitly or makes it clear that he or she still reserves the right to take legal action. In such cases the employee cannot be said to have condoned or accepted the change in working conditions. Furthermore, courts have held that an employee cannot be said to have condoned the change in working conditions if the employee formally commences legal proceedings in respect of the change while remaining in the employ of the employer. If the employee does not formally initiate proceedings but simply attempts to negotiate the matter while remaining at work, the employee cannot be said to have condoned the change as long as negotiations are ongoing. | ||
|
For the purposes of determining whether or not a complaint has been filed within the 90-day time period as required by s.240(2), a constructive dismissal takes place at the time the employer changes the terms and conditions of employment. In order to be admissible, the complaint must be filed within 90 days of that time, unless the complainant qualifies for an extension of the time to file under s.240(3). |
¶ 28 This interpretation also provides a number of examples on management behaviour that illustrate constructive dismissal; the most pertinent is the following:
|
No. Reduced Hours, Salary, Status or Benefits | ||
| The employee's quitting due to a major reduction in an employee's hours of work or change in the location of employment is often sufficient to make up a constructive dismissal. However, there is no constructive dismissal where the employee is moved to another location in the same city or if the employee knew that potential relocation was part of the job. | ||
|
A unilateral change in the employment status of a salesperson from employee to independent contractor has been held to be constructive dismissal. The withdrawal of a company vehicle may constitute a dismissal in disguise, if the vehicle is an essential work tool, and the employer does not have a good reason for its removal. |
¶ 29 Another standard reference treats constructive dismissal in a similar manner [See Note 2 below]:
Note 2: See: Wrongful Dismissal Practice Manual, Ellen P. Mole, Chapter 3, Butterworths.
|
"Once a contract of employment has been formed, neither party has the right to unilaterally change a significant term of the contract, unless both parties agree... In such a case the employer has no right to force an employee to accept a change or quit or take a severance package". | ||
|
"To constitute constructive dismissal, the change must effect a fundamental term of the contract. It has been said that the change must be fundamental, severe, serious, unilateral and substantial and without reasonable notice to the employee. There may be a right to change other terms or working conditions unilaterally, but a fundamental term can only be changed with the employee's consent" | ||
| "... it has been held that constructive dismissal can exist even without identifying a specific fundamental term in the contract that has been breached, for example, where the employer's treatment of the employee makes continued employment intolerable. Such conduct demonstrates an intention to no longer be bound by the contract." | ||
| "The onus is on the employee to prove a fundamental breech has occurred." |
Analysis
¶ 30 A constructive dismissal requires the employer to implement, without the employees consent, a "fundamental, severe, serious, unilateral and substantial ..." change to the employment contract. The issue in this case is, was the refusal of the Sakimay First Nations to permit Ms. Pelletier to accumulate overtime for all hours worked beyond the usual work day, 8:00 am to 4:00 pm, a fundamental breach of her employment contract?
¶ 31 A more fundamental question is, was the right to earn overtime for all hours worked in excess of those hours a term of her employment contract? The clear answer to that is no.
¶ 32 Her initial offer of permanent employment on Dec.16, 1998 was as Band Manager at a salary of $34, 5000. This offer stated in part, "There will be no overtime approved for any time worked beyond the usual (8:00 am to 4:00 pm) 7.5 hours of work each day".
¶ 33 Ms Pelletier said she did not submit a required written acceptance of the offer of employment of Dec. 16, 1998 because she did not accept its overtime stipulation.
¶ 34 However on Jan. 27, 2000 she did accept in writing a "position with the Sakimay Administration/Clinic" at a salary of $34, 500. The position she accepted and subsequently occupied was that of Band Manager, the same position offered on Dec. 16, 1998. By signing she accepted the conditions of employment accompanying that position.
¶ 35 Ms Pelletier also acknowledged she was bound by the Sakimay Band Personnel Manual. Section 4.11 of this manual reads as follows:
|
Overtime: a) Full-time Permanent Staff " - shall mean time over and above normal hours of work, where attendance is required at Band Meetings, as well as any time over and above normal hours of work where prior approval by the Band Administrator is granted for a specific job or duty" |
¶ 36 Her job description stated she operated under the direction of the Sakimay Chief and Council. Any overtime required the prior approval of one or other of these parties.
¶ 37 It is clear from the outset that the Sakimay First Nations intended to minimize overtime cost. This did not limit it from exercising its discretion to approve overtime payments in cash or time in lieu from time to time to Ms. Pelletier.
¶ 38 However it is also clear that it did not agree with Ms. Pelletier's contention that she was entitled to overtime for all hours worked in excess of regular hours, whether or not such work was approved by the Chief or Council. Its failure to agree with her contention did not constitute a fundamental breach of her employment contract; such a provision was not a part of her employment contract.
¶ 39 Ms. Pelletier stated she was not treated in a similar fashion as others whom were paid out their overtime accumulations. She cited the case of the Public Works Supervisor who she claims was paid out his accumulated overtime. However, Ms. Pelletier chose to introduce no witnesses because "it would implicate people and hurt their current job". Thus we have no direct evidence on the circumstances of such payments so as to determine whether her circumstances were similar or different.
¶ 40 It is clear that the Sakimay First Nations were not intent in poisoning the employment relationship in order to prompt her to quit as illustrated by the following:
|
- her employment evaluation of Dec. 2000 was "above average" | ||
| - at her request, a decision to defer her increment to a later date was rescinded | ||
| - she was granted additional remuneration for the performance of special tasks | ||
| - certain amounts of her accumulated overtime were paid in the form of a cash payment |
¶ 41 Ms. Pelletier claimed she was not granted fair hearing on the matter of her overtime concerns. That she was not given the opportunity to speak on her own behalf. By her own admission, she was "forcing the issue because they were not taking it seriously". However, it is clear that her concerns were known by the Sakimay Chief and Council. It seems obvious that did not want to be put in the position of renegotiating Ms. Pelletier's employment contract. If they are to be faulted it was in misleading her to believe the issue was being considered and in not dealing decisively with this matter at an early stage.
¶ 42 There were a number of other issues introduced in evidence, eg: Ms. Pelletier's absence from work without leave, the payment of incidental milage expenses etc. These were advanced as illustrative of unfair treatment and a break down of trust. In regard to the former she acknowledged she took her leave without prior permission. Leave from work, by its very definition, requires such permission. A written reprimand in such circumstances is not excessive.
¶ 43 I believe these issues were not central to the determination of whether a constructive dismissal had occurred. A constructive dismissal requires a unilateral change by the employer in a mutually agreed fundamental element in the employment contract. That did not occur in this case.
¶ 44 By way of settlement, Ms. Pelletier did not seek re-instatement. Rather she sought a severance payment and the payout of 200 hours of accumulated overtime.
¶ 45 As is clear on the evidence Ms. Pelletier's primary dispute with the Sakimay First Nations is over a wage entitlement. Such issues are pursued under Recovery of Wages, Section 251.1 of the Canada Labour Code. My appointment is under Section 242 (1) of the Canada Labour Code. and my task is to adjudicate an alleged unjust dismissal not to referee an wage dispute under Section 251 of the Code.
Decision
¶ 46 In summary, the entitlement to overtime was not a fundamental and mutually agreed condition of Ms. Pelletier's contract of employment with the Sakimay First Nations. Thus the failure to make such payments do not constitute a constructive dismissal.
QL UPDATE: 20030526