My employer cut my pay by 25%. Am I being constructively dismissed?
A unilateral pay cut by your employer will almost always amount to constructive dismissal. That is particularly so if the pay cut is substantial, which 25% would be. The pay reduction is a significant change to a key term of your employment, which is grounds for a constructive dismissal claim. For more on pay reductions and constructive dismissal, see “What you should know,” above.
What are the risks of bringing a claim for constructive dismissal?
The biggest risk is the court finding you weren’t forced to quit — you quit voluntarily. So you aren’t owed notice or severance pay.
In this case the shoe might suddenly be on the other foot. The court might find that you “repudiated” (broke the terms of) your contract. Depending on what your contract says, you might have to pay your employer for not giving them proper notice before quitting.
Another risk is losing your job and source of income. There’s no guarantee your claim will be successful. If the court rules in your employer’s favour, you may be left high and dry.
Seek legal advice if you think you’re being forced to quit your job. An experienced employment lawyer will be able to help you minimize your risk as you deal with your issue.