It has become harder and harder to have a binding termination provision in an employment agreement, but it can still be done. Several cases provide further details.
A recent decision from the Ontario Court of Appeal dealt with the unusual situation of a defendant employer arguing that its own contractual termination provision was unenforceable and thus the plaintiff employee was entitled to common law reasonable notice. Employees frequently challenge the enforceability of a termination provision to seek common law notice, however, it is rare that an employer would do the same.
Before hiring your first employee, an employer needs to educate itself on the various requirements under the Employment Standards Act, 2000 (and other legislation such as the Workplace Safety and Insurance Act (the “WSIA”) and Occupational Health and Safety Act) and the nuances associated with termination of an employee’s employment. Although there will be some upfront costs associated with record keeping, registering for insurance pursuant to the WSIA and learning about employment legislation, the benefits of such proactivity will pay off in the future when issues inevitably arise, even if you only have one or two employees.