Anytime you ask an existing employee to sign a new employment contract, it’s important to proceed cautiously. There are risks and pitfalls that wary employers may wish to avoid when making a change to their employment contracts. A misgauged approach may result in an unenforceable contract, or worse, result in a costly claim of constructive dismissal.
As set out below, the Ontario Courts have clarified generally two methods to change employment contracts. The first method is for when an employee consents and agrees to the changes, and the second is how to change employment contracts when the employee refuses.