Paul Lane, a parliamentary secretary who served as the Progressive Conservative government's caucus chairman, said Dunderdale has lost touch with voters.
He pointed to her handling of widespread power outages earlier this month as "the final straw that broke the camel's back."
Lane said Dunderdale was largely absent as people coped with rolling blackouts in freezing temperatures that culminated Jan. 4 in a major system failure affecting 190,000 customers. At one point, elderly residents of a private personal care home in St. John's were bundled and moved to a nearby hotel as scores of irate citizens dealt with burst water pipes and other fallout.
Lane told a news conference Monday in Mount Pearl that Dunderdale "was once again nowhere to be found" after power interruptions began Jan. 2.
"To make matters worse, two or three days later, when the premier finally decided to speak to the people of Newfoundland and Labrador, instead of demonstrating empathy for all the people negatively impacted by the blackouts, the focus of the news conference centred around whether or not the situation by definition was a crisis.
"For many people, this was indeed a crisis."
Lane also cited Bill 29, a law passed in 2012 that tightened access to government information. He said while he voted in favour of the bill, repeated complaints from constituents have convinced him it is too regressive.
"I say to the premier that while her intentions may be honourable, I believe that our government has lost its way and has indeed forgotten to listen to the people of Newfoundland and Labrador."
The premier was out of the province Monday. A brief statement released by her office said there was no advance warning of Lane's defection.
"Mr. Lane didn't express any discontent with leadership or the direction of the party before his announcement today, including when he accepted a promotion on Oct. 9," it says of Lane's appointment as parliamentary secretary to the minister for innovation, business and rural development.
"Mr. Lane had ample opportunity to voice his concerns surrounding leadership and direction of the party to me. He did not."
The statement said the premier will have more to say when she returns "in coming days."
Dunderdale became the uncontested party leader after former premier Danny Williams quit politics in late 2010. She was re-elected with a majority government in October 2011 and the next provincial vote is set for October 2015.
The Tories have been in power since 2003.
Lane was elected to represent the district of Mount Pearl South in October 2011. His departure is the latest blow for Dunderdale who has watched once sky-high approval ratings under Williams evaporate.
It follows a move by Tom Osborne who left the Tories to sit as an Independent in September 2012 before joining the Liberals. He also cited doubts about Dunderdale's leadership.
Other hints of unease with the premier came in November after the Tories lost a key byelection to the Liberals in the former riding of senior cabinet minister Jerome Kennedy.
Paul Oram, a former Tory cabinet minister who served alongside Dunderdale, said after that loss that she should re-evaluate her future.
On Monday, Oram said it's time for Dunderdale to go.
"Quite frankly, we cannot win the next election with the current leader," he said in an interview.
Oram, who left politics in 2009 for health reasons, is now president of the Progressive Conservative party's Terra Nova district association. He said he has heard from many organizers that they'll sit out the next campaign without a change at the top.
"They cannot support the leadership right now."
Dunderdale has repeatedly denied in recent months any plans to quit.
Liberal Leader Dwight Ball said discussions with Lane began last Monday, and that he shares party concerns such as access to information restrictions. Asked if the move seems opportunistic, Ball said he's comfortable with it and that all districts will be open to nomination contests for the 2015 election.
Ball denied Monday that he is in any "formal" talks with other potential floor-crossers.
Lane's departure leaves the Tories with 34 members in the legislature and gives the Liberals nine seats, while the NDP has three. There are two Independent members.
Pollster Don Mills of Halifax-based Corporate Research Associates said he has never seen a government rebound from such a popularity plunge.
"They've been in a free fall in terms of performance ratings," he said Monday. That dissatisfaction is despite strong economic forecasts, he added.
Dunderdale's approach on the recent power failures illustrates how her style has trumped substance, Mills said.
"Virtually every household in the province was affected by it, yet the premier remained silent on it," for the first two days.
"It was an unusual sort of response to what can only be described as a crisis situation."
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