November 2019

Most employment contracts contain a termination clause that defines an employee’s rights to notice, severance, or termination pay in lieu of notice. Termination clauses are almost always drafted in favor of the employer by limiting notice periods to statutory minimums contained in the Employment Standards Act (“ESA”). In the absence of such a clause, or where the clause is present yet unenforceable, the employee is owed more generous common law notice, which is approximately one month for every year of service. Accordingly, the validity of a termination clause can have significant financial ramifications on both the employer and the employee.  Enforceability of termination clauses can…

In the #MeToo era, more people are speaking up about workplace sexual harassment, and employers are feeling pressure to develop better methods of addressing it. However, the problem has far from disappeared, partly because there are limited forms of recourse available to victims. Those available generally involve holding employers responsible for how they address instances of sexual harassment. This strategy is limited in its effectiveness and fails to adequately address the harm to the victim. A recent Ontario Court of Appeal decision is an example of how the law gives leeway to employers that generally benefit sexual harassers. Further, it…

Most contracts are written in dated legalese that even the most seasoned lawyer can struggle to comprehend. Where one party to an agreement is less sophisticated and holds less power, and the other party (that likely drafted the contract) yields more power, courts will look to confirm that the less sophisticated party understood the agreement they were signing off on.  Courts are especially vigilant to circumstances where the lesser party bore an amount of risk that was significantly higher than the benefit they gained. A good example is a loan guarantee. A guarantor may not understand the document, and may…

When an employee is terminated without cause, he or she is generally entitled to reasonable notice or pay in lieu thereof. The employer is required to pay the employee all of the regular compensation that he or she would have received during the notice period. Regular compensation means more than base salary – it includes benefits such as non-discretionary bonuses and stock option plan entitlements. Many employers attempt to limit entitlements to such benefits by including clauses in incentive and bonus agreements that require “active employment” for the agreement to remain in effect, or that extinguish benefits upon an employee’s…