Why the internal job posting is often misleading — and legally risky

For many Canadian employees, the most misleading document they will encounter is not an employment contract. It is an internal job posting.

Employers increasingly promote the idea of "careers within." Roles are posted, competitions run, interviews conducted. The process appears structured, fair and transparent.

It is often none of those things.

In a growing number of cases, the successful candidate has been selected before the posting goes live. The "competition" that follows exists for optics, internal policy compliance or to maintain morale. Other candidates are invited to apply and, critically, given reason to believe they might well get the job — or at least that the outcome is uncertain.

It is not.

From a business perspective, this may be benign, but from a legal one, it is laden with risk.

Courts do not police whether employers make the "right" promotion decision. They do, however, scrutinize representations made to employees — and the consequences when those representations are relied upon.

That distinction is where liability begins.

When an employee is told they are a leading candidate, a "natural successor" or that a role is effectively theirs to lose, the employer moves beyond mere encouragement. It creates a representation. If the employee relies on that representation — by declining another offer, say, remaining in their role for longer or altering their career plans — the legal analysis shifts.

At that point, the issue is no longer who deserved the promotion. It is whether the employer induced reliance on an outcome that was never available.

Canadian courts have long recognized claims for misrepresentation where an employee is induced to join — or remain with — an employer based on assurances that prove untrue. The principle is not confined to hiring. It also applies within the employment relationship.

Where that reliance is established, damages may follow.

In the context of a subsequent termination, the consequences can be more significant. Misleading an employee about advancement opportunities may support a claim for bad faith in the manner of dismissal, attracting additional damages. Where the failed process leaves the employee sidelined or diminished, constructive dismissal may also be alleged.

Employers often underestimate how easily casual language becomes evidence. Internal candidates are not external applicants. They work within the organization. They know how decisions are made. A manager's offhand assurance may carry far more weight than intended — and far more than a court will ignore.

The more formal the process, the greater the risk. Detailed postings, multiple interview stages and documented feedback all reinforce the appearance of a genuine competition. Where that appearance is false, the record does not assist the employer but undermines it.

None of this prevents employers from promoting whom they choose. It just requires honesty.

If a decision has been made, there is little to be gained — and much to be lost — by staging a competition suggesting otherwise.

And if a process is undertaken, communications must be measured. Encouragement is permissible. Assurances are not.

Employers adopt internal competitions to signal fairness and transparency. They are often achieving the opposite.

Courts are unlikely to be concerned with whether an employee was disappointed.

They will be very concerned if that disappointment was manufactured.

Howard Levitt is senior partner of Levitt LLP, employment and labour lawyers with offices in Ontario, Alberta and British Columbia. He practices employment law in eight provinces and is the author of six books, including the Law of Dismissal in Canada.