Restaurant constructively dismissed executive chef after reducing his salary and role

Restaurant cut chef's pay after funding from hotel dried up
|Canadian Employment Law Today|Last Updated: 07/06/2016

A Nova Scotia restaurant must pay a former executive chef pay in lieu of notice for constructive dismissal equal to his original salary after it unilaterally reduced his salary and changed his role, the Nova Scotia Small Claims Court has ruled.

Daniel Orovec, 48, was hired by Ryan Duffy’s, a steak and seafood restaurant in Halifax, on Jan. 5, 2015, to be the restaurant’s chief operating officer and executive chef. His annual salary upon starting with the restaurant was set at $75,000. Orovec left another position to join Ryan Duffy’s.

The restaurant had a relationship with a local hotel where the hotel gave it $40,000 per month that partly funded Orovec’s salary. However, in April 2015, it was decided to end this relationship. Restaurant management called Orovec into a meeting and told him that the chief operating officer position couldn’t be continued without funding from the hotel, as it was this funding that allowed Ryan Duffy’s to hire Orovec in the first place. They also told Orovec that he was welcome to stay on as executive chef at the restaurant at a salary of $50,000 per year.