How To Interpret Employment Contracts In BC

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We often get asked if the employment contract someone signed on day 1 of their employment is still enforceable after the employee has been promoted and received salary increases.  In British Columbia, the Supreme Court confirmed in October 2025 in LaPlume v AAA Internet Publishing Inc., 2025 BCSC 2139,  that changes to employment does not impact the enforceability of the employment contract.

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Mr. Laplume became an employee of AAA Internet Publishing Inc. in December 2013, after some time as an independent contractor.  While initially in a junior position, Mr. Plume received salary increases in 2015, 2016 and 2019 and then was promoted to a manager role in fall 2019 then to operations manager in 2022, which is the role he held until his without cause termination in July 2023.

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The employment contract Mr. Plume signed in 2013 contained a termination clause that set out severance amounts greater than the Employment Standards Act amounts, and, at paragraph 3 said:

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During your employment, the Company may change your position, title, duties, responsibilities or reporting relationship as it deems appropriate from time to time, consistent with your qualifications, skills and experience, and such change will not constitute a breach of this [employment contract] or a constructive dismissal, as long a such changes do not materially increase work duties or hours of work;

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The BC Supreme Court considered Mr. Plume’s raises and the changes to his job description with reference to the common law concept of “changed substratum”, essentially it is possible to “outgrow” an employment contract if an employee's job duties, responsibilities, or compensation expand so drastically over time that they are no longer connected to the foundation of their original role, and whose effect is to void the outgrown employment contract.

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To understand if “changed substratum” occurred the BC Supreme Court reviewed Mr. Plume’s employment contract, in particular the clause permitting the employer to change the employee’s position and duties and asked what is

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   (a) the degree of change required to constitute the erosion of the substratum of the contract;

   (b) the degree of the changes to the terms of employment in this case, and

    (c) in any event, were the changes contemplated or allowed under the employment contract?

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In Mr. Plume’s case the changes to his employment were not considered dramatic since they consisted of mostly pay increases and his first promotion to manager of a small team was after seven years of employment, and the subsequent promotion added relatively minor responsibilities to the work he was already doing. According to the judge, these are reasonable incremental changes to employment so didn’t change the enforceability of the employment contract, and were contemplated and within the expectation of paragraph 3 of the employment contract.  Specifically, the BC Supreme Court found:

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Specifically, pursuant to para. 3, both he and the defendant expected Mr. LaPlume’s role to evolve with his qualifications, skills, and experience. That is exactly what happened: as he gained more experience and skill as a developer, his role evolved to overseeing less experienced developers. Paragraph 3 expressly reflects that both parties expected that the employment contract would remain effective notwithstanding those changes.

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KEY TAKEAWAYS

It is important to start out all employment relationships with a solid and enforceable employment contract, and KSW Lawyers can provide legal advice to ensure your employment contracts anticipate and permits changes in employment.  Further, reviewing your employment contracts with KSW Lawyers periodically, especially when promotions are contemplated, will ensure any changes will not erode the foundation/substratum of the contract beyond what was anticipated and permitted.

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Finally, the following takeaways from LaPlume v AAA Internet Publishing Inc. will help to ensure that the employment contract signed on day 1 continues to be enforceable at the end of the employment relationship. Since not all changes in employment benefits, duties, and responsibilities are sufficient to erode the foundation/substratum of an employment contract, we recommend contacting KSW Lawyers if:

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- Significant changes in employment are being planned since they can make the employment contract unenforceable IF

    (a) The foundation/substratum of the employment when the employment contract was signed no longer exists by the time of termination, or

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   (b) it may be implied that the employed contract could not have been intended to apply to the position ultimately occupied by the time of termination.

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- A change that could be dramatic and fundamental is being considered since they can erode the foundation/substratum of an employment contract. If incremental and predictable changes in the terms of employment are introduced, they are unlikely to be a sufficient basis on which to conclude that an employment contract is unenforceable.

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- Where an employment contract anticipates and permits changes in employment, the change required to erode the foundation/substratum of the contract must be beyond what was anticipated and permitted.

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Please contact Fiona H McFarlane for more information.

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