If your employer has told you that your job conditions are about to change, your pay, your role, your hours, you may be wondering: can they actually do that? And what happens if you refuse to accept the new terms?
The short answer is: employers cannot unilaterally change the fundamental terms of your employment contract without consequences. Depending on how the change is handled, you may have the right to treat yourself as constructively dismissed, even if you haven’t been fired.
An announced change can be enough to act on. Here is what constructive dismissal is and when an anticipatory breach qualifies.
Table of Contents
What Is a Constructive Dismissal?
A constructive dismissal occurs when an employer makes such a significant change to your employment terms that it effectively amounts to ending the original employment relationship, even if they never formally fire you.
Courts have recognized two main ways this can happen:
- The employer unilaterally changes a fundamental term of your contract (like your salary, title, or responsibilities).
- The employer’s conduct demonstrates that they no longer intend to be bound by the employment contract.
An anticipatory constructive dismissal is a specific type where the employer announces a future change before it takes effect. Even though nothing has changed yet, the announcement itself can trigger your legal rights.
Learn more about constructive dismissal here.
What Happens When Your Employer Announces a Future Change?
When an employer tells you that a fundamental term of your contract will change at a later date, this is known as an anticipatory breach of contract. If the change is presented as a done deal, something you have no say in, a constructive dismissal may already have occurred.
This means you don’t have to wait for the change to take effect. You may be entitled to treat the employment relationship as ended and pursue damages for wrongful dismissal.
Learn more about wrongful dismissal here.
How the Way Your Employer Communicates Affects What You’re Owed
Not all contract change scenarios are equal. How your employer delivers the news, and whether they follow the proper legal process, directly affects the damages you may be entitled to. Here are the two situations you are most likely to encounter:
Your Employer Announces the Change Without Any Ultimatum
If your employer tells you that a change is coming but continues operating under your existing terms while waiting for your response, this approach works in your favour. If you don’t accept the change and the employer proceeds anyway, they have not given you any formal notice of termination. That means you would likely be entitled to the full reasonable notice period without any reduction.
Your Employer Gives You a Deadline to Accept or Face Termination
If your employer pairs the announcement with a clear message that your employment will end on a specific future date if you do not accept the new terms, this is a more legally structured approach. In this scenario, the time between the announcement and that future date may count toward the reasonable notice period you are owed. Depending on how much notice was given, this could reduce or even eliminate any further damages the employer owes, though statutory severance pay may still apply in some provinces.
The key point for you as an employee: the absence of a proper written notice tied to a specific termination date generally means a stronger damages claim.
Case Study: Yakubow v. Edmonton Granite Memorials Ltd., 2026 ABKB 360
A 2026 Alberta court decision illustrates exactly what happens when an employer gets this wrong and how costly the consequences can be. Yakubow v. Edmonton Granite Memorials Ltd., 2026 ABKB 360
Background
The employee had worked for his employer for over 20 years, rising to the role of sales manager. He had no written employment contract. In January 2023, the owner presented him with a new written employment contract and asked for a response by the following Monday, effectively giving him no full business day to seek legal advice. Crucially, the owner never told the employee he had the right to consult a lawyer.
The new contract would have made five significant changes to his existing terms, including:
- Capping his termination pay at Employment Standards minimums (eliminating his common law reasonable notice entitlement)
- Adding a non-solicitation clause
- Adding a non-competition clause
- Changing his job title and duties
- Replacing discretionary bonuses with a formalized structure
What the Employer Did Wrong
Over the following week, the owner repeatedly approached the employee at work to pressure him into signing. He told him that other employees had already signed similar agreements and that new ownership could impose “whatever agreement it chose,” and that a signed contract was required regardless. The contract itself was dated as accepted on the day it was presented and showed no indication it was a draft or open to negotiation.
The employee resigned six days after receiving the contract and claimed constructive dismissal.
What the Court Decided
The court found that the employer had constructively dismissed the employee. Even though the new contract was never technically implemented, the employer’s conduct clearly communicated an intention not to be bound by the existing employment agreement. That is enough to constitute an anticipatory breach and therefore constructive dismissal.
The employer argued the contract was merely a draft open for negotiation, but the court rejected this. The evidence showed the opposite: every communication from the owner confirmed that the termination provisions and restrictive covenants were mandatory and final.
The Damages
The employee was awarded $149,812.50, representing 15 months’ pay in lieu of notice. That figure included:
- Base salary: $103,500/year ($8,625/month)
- Discretionary bonuses: Calculated using a three-year average of $6,000/year ($500/month)
- Benefits: An additional 10% of base salary ($862.50/month), covering the health spending account, disability insurance, life insurance, and other benefits
The employer argued the employee failed to mitigate his damages, but the court dismissed this. It found that his job search, while imperfect, was not unreasonable, and more importantly, the employer failed to prove that comparable work was actually available. The fact that it took three years to find a permanent position at roughly half his previous salary spoke for itself.
No aggravated damages were awarded. While the employer’s pressure tactics led to the constructive dismissal finding, the court found the conduct did not cross into the dishonesty or bad faith required for aggravated damages.
What This Case Teaches Us
This case is a reminder that the manner of presenting a new contract matters as much as its contents. Presenting changes as a fait accompli, applying repeated pressure, and failing to invite negotiation on fundamental terms are all factors that courts will weigh against an employer. And with 20 years of service, the cost of getting it wrong was significant.
What Are Your Rights If You Refuse the Changes?
If you reject the proposed changes, you have meaningful legal protections:
- Your original contract remains in force until the end of a proper notice period. You cannot be forced onto new terms mid-notice.
- Continuing to work does not mean you’ve accepted the changes. If you make it clear you object to the new terms, showing up to work will not be treated as consent.
- If the employer implements the changes anyway, you may have grounds for a constructive dismissal claim.
One important nuance: if an employer proposes a package of changes, some beneficial and some harmful, and you reject the harmful ones, the employer cannot treat the whole package as accepted simply because you continued working after they implemented it unilaterally.
What Happens If Your Employer Does Follow the Proper Process?
If your employer handles the situation carefully, the law does provide a path for them to make changes to your employment terms over time. Understanding this process helps you know where you stand.
Under Canadian employment law, as developed in Wronko v. Western Inventory Service Ltd. (2008 ONCA), a properly structured change looks like this: the employer sends you a written notice stating the new terms and making clear that if you do not accept them, your employment will end at the conclusion of the applicable reasonable notice period. That notice should also include a formal offer of continued employment on the new terms, and that offer must remain open throughout the entire notice period.
What this means for you in practice:
- You are entitled to keep working under your original terms for the full duration of the notice period, even if you reject the changes.
- If the employer keeps the new terms offer open, declining it could be used to argue that you failed to mitigate your damages, potentially reducing what you are owed. Getting legal advice before refusing is important.
- If the employer does not follow this process correctly, including failing to tie the notice to a specific termination date or withdrawing the offer prematurely, their attempt to limit liability may fail entirely.
- If you continue working past the end of the notice period under your original terms, the employer is considered to have acquiesced. The new terms are treated as never having taken effect.
The bottom line: even when employers try to do things by the book, you still have rights throughout the process and the specifics matter enormously to what you may be owed.
Key Takeaways
- Your employer cannot simply impose major changes to your employment contract without legal consequences.
- An announcement of a future change to a fundamental term can constitute a constructive dismissal right away.
- How an employer communicates the change and whether they give proper notice directly affects how much you may be owed.
- Refusing to accept new terms does not mean losing your job immediately; your original contract protects you through the notice period.
- Continuing to work while clearly objecting to new terms may not count as acceptance.
Speak with an Employment Lawyer
If your employer has recently told you that your role, pay, or working conditions are changing, especially if it was presented as non-negotiable, you may have more rights than you realize.
Our Calgary employment lawyers can help you assess whether the proposed change amounts to a constructive dismissal, what damages you may be entitled to, and how to respond strategically. Acting quickly matters, as delay can sometimes be used to suggest you accepted the change.
Frequently asked questions about employment contracts
Can my employer change my employment contract without my consent?
No. An employer cannot unilaterally change a fundamental term of your employment contract, such as your salary, job title, hours, or restrictive covenants, without your agreement. If they do, or if they clearly communicate an intention to do so, you may have grounds for a constructive dismissal claim.
What counts as a “fundamental term” of my employment contract?
Fundamental terms are the core conditions of your employment, the ones you would have considered essential when you accepted the job. These typically include your compensation and bonuses, job title and duties, hours of work, location, and termination entitlements. The addition of restrictive covenants like non-competition or non-solicitation clauses to a contract that previously had none also qualifies, as the Yakubow case confirms.
Does my employer have to give me time to review a new employment contract?
Yes. Presenting a new contract on a Friday afternoon and demanding a response by Monday, as happened in Yakubow v. Edmonton Granite Memorials Ltd., 2026 ABKB 360, is exactly the kind of pressure tactic courts look at critically. You should be given a reasonable opportunity to review the contract and seek independent legal advice. Failing to inform you of your right to consult a lawyer is also a factor courts consider.
If I keep showing up to work after my employer announces changes, does that mean I have accepted them?
Not necessarily. Continuing to work while clearly and consistently objecting to proposed changes will not typically be treated as acceptance. What matters is whether you communicated your objection. If you show up to work but make it clear you reject the new terms, your presence alone does not bind you to them. However, if you say nothing and continue working for an extended period, a court may find that you implicitly accepted the changes. Getting legal advice quickly is important.
What happens if I refuse to sign a new employment contract?
You have options. You can reject the changes and, if the employer proceeds anyway, pursue a claim for wrongful dismissal. You can also reject the changes, continue working under your original terms, and insist the employer either honour those terms or terminate you with proper notice. What you should avoid is staying silent or delaying, as that can complicate your legal position.
How much compensation could I receive if I am constructively dismissed?
It depends on your individual circumstances. Damages are typically calculated based on the reasonable notice period you were entitled to, which courts determine using factors including your length of service, age, seniority, and the availability of comparable work. Your full compensation package during that period, including salary, bonuses, and benefits, is included in the calculation.
When should I speak to an employment lawyer about a new contract?
As soon as possible, ideally before you sign anything or respond to your employer. A Calgary employment lawyers can review the proposed changes, advise you on whether they constitute a constructive dismissal, and help you respond in a way that protects your legal rights. Acting early gives you the most options.
This article is for general informational purposes only and does not constitute legal advice. Employment law varies by province and individual circumstances. Please consult a qualified employment lawyer for advice specific to your situation.