Subscribe to our newsletters
Day v Tahltan: Admin Leave Policy Failures Cost $320,000
Having a workplace policy is not enough. Following it is what protects you. The 2025 BC Supreme Court decision in Day v. Tahltan Central Government (2025 BCSC 1363) is a clear illustration of what happens when an employer imposes an administrative leave without adhering to its own complaint-handling procedures a four-month paid leave with limited communication and no adherence to process resulted in a constructive dismissal award of over $320,000. While a BC decision, the underlying principles apply directly to employers in Ontario and any other Canadian jurisdiction where constructive dismissal law is grounded in the same foundational framework.
Does your organization have an administrative leave or investigation policy and are you confident it is followed every time?
A policy that exists on paper but is bypassed in practice offers no protection and may actively increase your liability. Get your policies reviewed and ensure your team knows how to apply them before a situation arises.
Call: 1-800-771-7882 Speak With an Employment LawyerWhat happened
The employee in this case was an elected board president employed by the Tahltan Central Government. Complaints were raised against him and the organization placed him on paid administrative leave for four months while those complaints were investigated. The employer had a written policy manual that set out the steps required before placing an employee on administrative leave in connection with a complaint. Those steps were not followed.
The court found that bypassing the required policy process amounted to a substantial unilateral breach of the employment contract. The employee was left in professional limbo for four months paid but removed, without process and without clear communication about next steps. The court found this constituted constructive dismissal and awarded over $320,000 in damages including compensation in lieu of notice.
What the court found and why it matters for Ontario employers
Bypassing your own policy is a breach of contract
The court found that the employer's written complaint-handling policy formed part of the employment relationship. Failing to follow the required steps before imposing the administrative leave was a unilateral change to a fundamental term of that relationship. The policy was not aspirational guidance it was a binding process the employer was required to follow. Employers who create detailed policies and then skip steps under pressure create exactly this liability.
A paid leave can still be constructive dismissal
The leave was paid the employee continued to receive his salary throughout. This did not prevent the constructive dismissal finding. The court focused on whether the employer's conduct fundamentally changed the employment relationship, not on whether the employee suffered a financial loss during the leave. Being removed from duties, excluded from the organization, and left without process or communication for four months was sufficient to meet the threshold.
Duration and communication failures compound the problem
Four months of administrative leave with limited communication and no clarity on what would happen next significantly contributed to the constructive dismissal finding. The longer a leave continues without a defined process, a timeline, and regular updates, the harder it becomes to characterize as a temporary administrative measure rather than a fundamental change to the employment relationship.
Four employer lessons from this decision
Every step in your policy must be followed, every time
The more detailed your administrative leave or investigation policy, the more precisely you must follow it. Courts treat written policies as part of the employment relationship. Skipping steps even for understandable operational reasons like urgency or administrative oversight creates a breach of contract argument that is difficult to defend. If your current policy is too complex to follow consistently under time pressure, simplify it. A policy you can actually apply is more valuable than a comprehensive one you cannot.
Keep administrative leaves as short as possible
An administrative leave that stretches for weeks or months without a defined timeline and regular communication is legally vulnerable regardless of whether the employee continues to be paid. From an employer's perspective, the goal should be to conclude the investigation and make a decision as quickly as the circumstances permit. Where an investigation genuinely requires more time, communicate that clearly and regularly to the employee in writing. Silence during a prolonged leave is one of the clearest signals a court looks for in assessing whether the leave was a genuine administrative measure or something more.
Document every step and every communication
Where an administrative leave is imposed, document why it was necessary, what policy steps were followed, what was communicated to the employee and when, and what the anticipated timeline is. This documentation is your defence if a constructive dismissal claim is later filed. The absence of documentation does not just weaken your position it typically strengthens the employee's, because courts draw inferences from undocumented decisions. Our post on Merritt v. Tigercat covers a related example of how absent documentation collapses an employer's defence.
Consider alternatives to administrative leave before imposing it
Administrative leave should not be the default response to a workplace complaint or investigation. Before placing an employee on leave, assess whether modified duties, temporary reassignment, or remote work would allow the investigation to proceed without the employee's presence creating interference. Where the employee's presence genuinely creates a risk to the investigation or workplace safety, leave may be necessary but that reasoning should be documented. Where it is not necessary, alternatives reduce both the duration of disruption and the constructive dismissal risk.
Are your administrative leave and investigation policies clear, practical, and consistently followed?
A policy that is bypassed in practice provides no protection and may increase your liability. Our team advises employers across Ontario and BC on workplace policies, investigation procedures, and administrative leave management. Get your policies reviewed before a situation arises.
Get Your Policies Reviewed Or call us: 1-800-771-7882Practical takeaways for employers
Questions about administrative leave, investigation policies, or constructive dismissal risk?
Our team advises employers across Ontario and BC on workplace policies, investigation procedures, and employment disputes. Contact us for a confidential consultation before your next employment decision.
Call us at 1-800-771-7882 or fill out the form below and we will be in touch.
The article in this client update provides general information and should not be relied on as legal advice or opinion. This publication is copyrighted by Achkar Law Professional Corporation and may not be photocopied or reproduced in any form, in whole or in part, without the express permission of Achkar Law Professional Corporation. ©