Transfer VS. Termination

Hi, 
I came across an interesting debate today and I was wondering if you could weigh in. I work for an organization in Alberta and we are downsizing in one of our steel shops. The downsizing is due to lack of work. We have an employee who we could move from our Nisku location to our Sherwood Park location and we are looking at two ways of doing this; One is to offer him the transfer (same job, higher pay, new location is 5 minutes from his house where the old location was 45 minutes) and also offer him severance and allow him to choose. A colleague of mine suggested that we offer the transfer and if he doesn’t accept we can accept his resignation. They said that from a human perspective they can see it wouldn’t be desirable but legally we should be able to do it. I feel that if we did do this the employee would be able to claim constructive dismissal. What are your thoughts?