Employers across Ontario are double-checking their contracts since the Ontario Court of Appeal released its judgment in Waksdale v Swegon North America Inc., earlier this month. The court held that if an Employment Agreement contains a termination-with-cause provision that breaches the Employment Standards Act, 2000 (ESA), the termination-without-cause provision will be rendered unenforceable as well. This is true even if the employer was not relying on the for cause section and had proceeded on a without cause basis. Even a severability clause cannot save a provision in this context.
Organizations are suddenly facing economic uncertainty given the new and far reaching consequences of COVID-19.
The Canada Labour Code, among other things, gives every federally regulated employee the right of arbitration when they are dismissed for cause, and in some cases when they are dismissed absent of any allegations of cause.