Reference no: EM132093147

Prince, a chartered accountant employed as a controller and living in Calgary, was bored with his job. He applied to an Ottawa based software company that was advertising for a chartered accounting to help in the development of new accounting software.   At the job interview, Paulson, the manager of research and development, described the new venture and told Prince that the position would involve advising on accounting standards for many new products, addressing such thing as cash flow management, inventory controls, accounts receivables, and more. Prince was told that the company would commit significant funds to the project for the next 10 years. This position was the first of many accounting jobs. It was implicit that Prince (if hired) would become senior management, supervising the subsequent hires. Formal plans were still before the executive committee but would be in place before the start date of May 1. This was exactly the type of new challenge Prince was looking for, so when Paulson called to offer him the job of manager, financial standards, Prince accepted immediately. A few days later he received the employment contract by email, signed it and returned it by courier. The job description said that Prince would supply accounting expertise required by the employer. Prince and his wife quit their jobs, sold their house in Calgary, bought a smaller, more expensive house in Ottawa, and moved across the country.

When the executive committee met in April to consider the development plan, they decided the plan was too aggressive and approved only the development of one aspect – cash-flow management. The project would be funded for only five months. Prince commenced work on May 1 and helped design the cash flow software. When he asked Paulson about the next phase, he was told that it was not firm yet. No other accountants were hired and, after five months, Prince was transferred to the accounting department to do typical controller work similar to his job in Calgary. He was unhappy with the transfer and quit.

1. What are the possible legal issues involved in this case?

2. What do you believe will be the probable outcome of this case? Cite any relevant cases.   

3. Would it make a difference to your answer if the contract of employment included a term that the employer might transfer or reassign the employee to another position within the company at any time and a term that all agreements between the parties were included in the written document?

4. What are some lessons business professionals can learn from this case?