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Discussions on Human Resources, Employment Law, Payroll and Internal Controls

termination clauses in employment contracts

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Equity compensation and effective communication of adverse terms

Does your organization provide equity compensation to employees? Stock options, restricted stock units, stock purchase plans, and performance shares are just some of the possibilities. Whatever the form, equity compensation has grown increasingly popular. This fact has also spurred greater employment litigation concerning equity entitlements.

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Specific penalty clause renders an ESA termination clause unenforceable

If followed, a recent Ontario case could result in the elimination of many specific penalty clauses in employment contracts. A specific penalty clause states that if an employee engages in a specific behaviour then the employee agrees s/he can be terminated for just cause without any notice or termination pay in lieu of this notice.

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Preventing an employee from working during working notice can be constructive dismissal

In Allen v Ainsworth Lumber Co Ltd, 2013 BCCA 271, the British Columbia Court of Appeal upheld a lower court decision which held that an employer’s refusal to allow an employee to work during a purported “working notice” period constituted constructive dismissal.

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