Fixed-term contracts can seem like a useful tool for employers that may not require an employee indefinitely. However, while they appear straightforward, fixed-term contracts come with certain risks and complexities that both employers and employees should know.
In Livshin v The Clinic Network Canada (2021 ONSC 6796) Black J. had situation where the termination clause breached the ESA in that they referenced ”just cause” as a a ground for paying no severance, which following Waksdale v Swegon, (2020 ONCA 391) is illegal and voids the entire termination clause, including the “not for cause” provision.
In Makela v. Horizon School Division No 67, 2019 ABQB 974, Master J.T. Prowse of the Alberta Court of Queen’s Bench dismissed an employee’s claim for wrongful dismissal arising out of a fixed-term employment agreement. While this case ultimately had a happy ending for the employer, Makela provides a warning for yet another potential pit-fall of fixed-term employment agreements.