Suspended From Work in Ontario: Is It Constructive Dismissal?
Being suspended, especially without pay, is not something an employer can simply do. An unjustified suspension can be a constructive dismissal that entitles you to severance.
Key takeaways
- An employer's right to suspend you is limited, not automatic. It has to be justified.
- An unpaid suspension is especially hard to justify and is often a constructive dismissal.
- The employer carries the burden of showing a suspension was reasonable and in good faith.
- If it is a constructive dismissal, you can claim the same severance as a firing.
- Do not resign on the spot. Object in writing and get advice first.
In this article
Being told you are suspended, sent home, and cut off from your pay is destabilizing, and many people assume they just have to accept it. In Ontario, they often do not. An employer's power to suspend an employee is narrower than most employers act like it is, and a suspension that is not justified, particularly one without pay, can amount to a constructive dismissal.
✅Quick answer. An employer does not have an unlimited right to suspend you. A suspension has to be for a legitimate business reason, reasonable in length, imposed in good faith, and usually with pay. An unpaid suspension, or an indefinite or punitive one, can be a constructive dismissal, which lets you treat your job as over and claim severance. The employer, not you, has to justify the suspension.
Can your employer suspend you at all?
Only within limits. The Supreme Court addressed this in Cabiakman v. Industrial Alliance Life Insurance Co. (2004 SCC 55). It recognized that an employer has a limited, implied right to suspend an employee for legitimate reasons, for example while serious allegations are investigated, but only where the suspension is justified, imposed in good faith, kept to a reasonable length, and, as a general rule, with pay. Withholding your salary during a suspension is not something the employer can simply assume it is allowed to do.
When does a suspension become constructive dismissal?
When it goes beyond those limits. The leading case is Potter v. New Brunswick Legal Aid Services Commission (2015 SCC 10). Mr. Potter was placed on an indefinite administrative suspension while, unknown to him, his employer was trying to negotiate a buyout of his contract. The Supreme Court held this was a constructive dismissal, and crucially, that the employer bears the burden of showing an administrative suspension was reasonable and justified. Because it could not, Mr. Potter was treated as dismissed and awarded the balance of his contract. Potter is the reason a suspension is not a safe move for an employer to make lightly.
Why unpaid suspensions are the hardest to justify
Your pay is a fundamental term of your job. Taking it away, even temporarily, strikes at the heart of the employment relationship, which is the classic test for constructive dismissal. Unless your contract clearly and lawfully allows an unpaid suspension, or a statute does, cutting off your salary while you are suspended will usually be treated as a fundamental breach. That is why unpaid suspensions are far more likely to be constructive dismissals than paid ones.
What if it is "pending an investigation"?
An investigative suspension can be legitimate, but it is not a blank cheque. It still has to be genuinely necessary, conducted in good faith, kept to a reasonable time, and, following Cabiakman, generally with pay. A suspension that drags on indefinitely, is really a punishment, or is used to push you out, can cross into constructive dismissal even under the "investigation" label. Being suspended is also not the same as just cause; the employer still has to prove any misconduct it later alleges.
What can you claim?
If the suspension is a constructive dismissal, you can claim what you would be owed for any dismissal: common law reasonable notice based on your age, service, role, and the job market. Where the employer acted in bad faith, for example suspending you without pay to force you out, you may also have a claim for additional bad-faith damages on top.
What should you do if you are suspended?
- 1.Ask for the reason and the terms in writing, including whether you are being paid and for how long.
- 2.Do not resign in the moment. Resigning can undercut a constructive dismissal claim.
- 3.Object in writing to an unpaid or indefinite suspension and reserve your rights.
- 4.Keep records of everything, and get advice quickly. A free review can tell you whether the suspension is a dismissal in disguise.
A suspension is closely related to being pushed out or forced to resign, and both are forms of constructive dismissal. If you are unsure which applies, the starting point is the same: do not accept it at face value and get the situation reviewed.
Frequently asked questions
Can my employer suspend me without pay in Ontario?
Rarely without consequences. An employer's right to suspend is limited and, under Cabiakman v. Industrial Alliance (2004 SCC 55), a suspension generally has to be justified, reasonable, and with pay. An unpaid suspension is often a constructive dismissal.
Is being suspended a constructive dismissal?
It can be. Under Potter v. New Brunswick Legal Aid (2015 SCC 10), an unjustified administrative suspension is a constructive dismissal, and the employer bears the burden of showing the suspension was reasonable and in good faith.
Can I be suspended without pay pending an investigation?
An investigative suspension can be legitimate, but it must be genuinely necessary, in good faith, for a reasonable time, and generally with pay. An indefinite or punitive unpaid suspension can amount to constructive dismissal.
What can I do if I was suspended unfairly?
Ask for the terms in writing, do not resign on the spot, object to any unpaid or indefinite suspension in writing, and get advice. If it is a constructive dismissal, you may be owed severance and possibly bad-faith damages.
Carmen Reyes
Legal Writer, Mirza Law
Carmen Reyes is a legal writer at Mirza Law in Toronto. She writes about constructive dismissal, workplace changes, and how Ontario employees can protect themselves when their job changes under them.
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