Termination provisions

What happens to employment contracts when an employer sells the assets of its business?

April 6, 2018 Stuart Rudner, Rudner Law Employee Relations, Employment/Labour Standards, Human Resources, Notice, Damages and Settlements, Payroll, 0

The Court of Appeal for Ontario has confirmed that in an asset sale, a purchaser’s offer of employment to a seller’s employee can constitute consideration for changes in an employment contract — including a new termination clause.

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Commitment to “comply with statute” not enough to displace common law rights on termination

February 16, 2018 Vey Willetts LLP Employee Relations, Employment/Labour Standards, Human Resources, Payroll, Wages and Compensation, 0

This decision serves as an important reminder to employers to draft clear and enforceable termination provisions in order to avoid unanticipated liability upon termination. In particular, the Movati decision confirms that should an employer want to limit its obligations upon termination to the minimum entitlements required by statute, it is necessary to include clear words of limitation.

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Wood vs. Oudin: Clarity in termination provisions

March 3, 2017 Stuart Rudner, Rudner Law Employee Relations, Employment/Labour Standards, HR Policies and Procedures, Human Resources, Notice, Damages and Settlements, Payroll, Pensions and Benefits, Source Deductions and Reporting, Wages and Compensation

In Wood v Fred Deeley Imports Ltd., the Ontario Court of Appeal seemed to make a definitive statement about the interpretation of termination provisions in employment agreements: a court will invalidate them when they contain actual or technical deficiencies. However, the same Court’s decision last year in Oudin v Centre Francophone de Toronto seemed to reach a different conclusion: the court will apply contractual certainty to give effect to the parties’ intentions. Can the two be reconciled? Closer inspection reveals that each decision is specific to the employment agreements in each.

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Termination provisions in employment contracts

January 20, 2017 De Bousquet PC Barristers and Solicitors Employee Relations, Employment/Labour Standards, HR Policies and Procedures, Human Resources, Notice, Damages and Settlements, Payroll, Pensions and Benefits, Source Deductions and Reporting, Wages and Compensation

As an employee, by law, you are entitled to reasonable notice of termination of your employment. Employers however, often attempt to limit your legal entitlements by explicitly defining your rights upon termination in the employment contract. In the recent case of Singh v Qualified Metal Fabricators Ltd. an Ontario Court adopted an employee–friendly interpretation of these termination provisions, resolving the potential ambiguities in favour of the employee. While employers are allowed to contractually limit employees’ common–law reasonable notice requirements, they are required to do so with complete precision.

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Why bother with employment contracts?

October 14, 2016 Lisa Stam, Spring Law Employee Relations, Employment/Labour Standards, HR Policies and Procedures, Human Resources, Notice, Damages and Settlements, Payroll, Recruiting and Hiring, Union Relations

I had a client recently ask why he would bother going through the cost and efforts of doing up an employment contract, if he was going to have to fight with ex–employees’ lawyers and pay out a package in a without cause situation anyway. Good question.

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Three popular articles this week on HRinfodesk

June 16, 2016 Cristina Lavecchia Employee Relations, Employment/Labour Standards, Health and Safety, HR Policies and Procedures, Human Resources, Human Rights, Payroll, Penalties and Fines, Privacy and Security, Source Deductions and Reporting, Union Relations, Wages and Compensation

The three popular articles this week on HRinfodesk deal with: A case where an employee was awarded $25,000 in damages because the employment contract contained a termination clause that could not be enforced; a case that addresses whether an employer, in a safety sensitive workplace, can require an employee to undergo a post-incident breathalyzer alcohol test and a urine drug test after a workplace incident; and a CRA document that addresses, where a payment received for work-related travel expenses exceeds the costs incurred, is the excess amount included in income under the Income Tax Act?

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Small claims court rules termination clause that violates ESA in future is unenforceable

April 14, 2016 Simon Heath, BA, MIR, LLB, Heath Law Employee Relations, Employment/Labour Standards, HR Policies and Procedures, Human Resources, Payroll, Wages and Compensation

This decision is another reminder to employers to ensure that termination clauses provide for all entitlements prescribed by the Employment Standards Act in order for them to be considered valid and enforceable. The company in this case should never have carved out its obligation to provide statutory Severance Pay.

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Danger ahead: Beware of changes to employment agreements

September 17, 2015 Occasional Contributors Employee Relations, Employment/Labour Standards, HR Policies and Procedures, Human Resources, Payroll, Pensions and Benefits, Recruiting and Hiring, Wages and Compensation

To appreciate the dangers of varying employment terms, we must start with the foundations of contract law. First, a contract requires that each party receive a benefit (consideration). Second, if the parties agree to a variation of contract, but consideration is not received by both parties, Courts will consider the new contract an “unenforceable unilateral variation”. Third…

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Contracting out of the Ontario Employment Standards Act

April 16, 2014 Earl Altman Employee Relations, Employment/Labour Standards, HR Policies and Procedures, Human Resources, Notice, Damages and Settlements, Payroll, Wages and Compensation

The Employment Standards Act in Ontario is legislation designed to protect the rights of all workers in the province. Under section 3, the Act specifies that it applied to any employee in the Province of Ontario, or any employee who is performing work outside of Ontario that is “…continuance of work performed in Ontario.” The Act contains numerous protections for Ontario employees, such as limiting the maximum hours of work in a week, providing an entitlement to overtime pay, and creating entitlements such as parental leave, vacation and personal leave. The Act also provides for the employee’s rights in the event of a termination of employment. Many employers have perceived these entitlements as onerous in some circumstances. In order to attempt to avoid such payments, or other obligations under the Act, employers have sought to have employees sign contracts containing provisions which purport to surrender the employee’s rights under the Act. This is generally referred to as “contracting out”.

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Top ten employment law myths and mistakes in employment contracts

November 4, 2010 Stuart Rudner, Rudner Law Employment/Labour Standards, Human Resources

I recently attended the Law Society’s annual Employment Law Summit, which is always filled with top-notch employment lawyers providing valuable insight and practical advice on issues relating to employment law and human resources. Many of the discussions touched upon issues relating to the use of employment agreements, including termination clauses. The comments caused me to consider my own experiences in dealing with…

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