Working for a spouse can present complex personal and professional challenges. But what happens when the relationship breaks down? If the working environment becomes intolerable, does the employee have legal recourse through constructive dismissal?
An Ontario case provides insight that may resonate with Alberta courts and employers navigating similar issues.
Case Study: Constructive Dismissal Following Relationship Breakdown
In Specs Appeal Inc. v. Scott, the Ontario Superior Court of Justice examined whether a marital breakdown between co-owners of a business could amount to constructive dismissal.
Facts:
- Ms. Scott entered into a romantic relationship with Mr. O’Reilly, the president and owner of Specs Appeal Inc.
- She later began working for the company and eventually married Mr. O’Reilly.
- After discovering his affair, Ms. Scott separated from him but continued working—briefly—before leaving the workplace altogether.
Mr. O’Reilly claimed that Ms. Scott resigned voluntarily. Ms. Scott argued that the conditions created by the breakdown of their marriage forced her out, amounting to constructive dismissal.
What Constitutes a Poisoned Workplace?
The Court heard evidence of ongoing marital discord, visible to other employees, and increasing workplace hostility:
- A physical altercation that resulted in police being called.
- Cancellation of Ms. Scott’s company credit card and banking authority.
- False accusations of cheque fraud against her.
The judge concluded that these actions, combined with Mr. O’Reilly’s unilateral revocation of her financial management role, created a poisoned work environment—a common ground for constructive dismissal.
No Clear Resignation Means No Voluntary Departure
Although Ms. Scott had discussed the idea of quitting, there was no clear, unequivocal resignation. The Court held that removal of core job duties and an intolerable work atmosphere amounted to constructive dismissal.
Ms. Scott was awarded reasonable notice damages, affirming her claim.
Alberta Perspective: Key Takeaways for Employers and Employees
While this case was decided in Ontario, Alberta courts may consider similar facts when determining whether constructive dismissal has occurred, especially in family-owned or spousal-run businesses.
For Alberta employers:
- Marital or personal conflicts spilling into the workplace can create liability if the environment becomes toxic.
- Revoking key responsibilities without justification can constitute a fundamental breach of the employment contract.
For Alberta employees:
- You may have grounds for a constructive dismissal claim if workplace conditions become unbearable—even if caused by personal relationships.
- A resignation must be clear and intentional. Courts will examine the broader context, including power dynamics and emotional strain.
Conclusion: When Family Law Meets Employment Law
This case underscores the overlap between family law and employment law in Alberta. When business and personal lives intersect, the risk of constructive dismissal claims rises—particularly when emotional conflict leads to decisions that undermine an employee’s role and dignity.
Contact Info
If you are dealing with a legal matter surrounding separation and divorce, please contact the lawyers at Kirk Montoute Dawson LLP today for family law advice.
Please note that we are not employment lawyers. If you’re looking for an employment lawyer, contact our friends at Cashion Legal, who can assist with employment law related matters.