A fixed-term employment contract also refutes the presumption of appropriate dismissal. The Ontario Court of Appeal ruled in Howard v. Benson Group Inc.4Howard v. Benson Group Inc. (The Benson Group Inc.), 2016 ONCA 256; that an employee dismissed before the expiry of the specified period is entitled to the wages and benefits he would have received at the end of the limited period, unless the employment contract contains an enforceable termination clause providing for a predetermined notice period in the event of early dismissal. Contracts are extremely important in commercial matters. Although the contracting parties intend to comply with the contractual requirements, it may be necessary to terminate the contract in certain circumstances. If there is no clause in the contract that allows for early termination, the party who wants to terminate the contract may find themselves in a very difficult and often costly position. It is essential that the parties take into account an early termination provision in their construction contract.
If such a provision exists, it is equally important that the party requesting early termination follows the procedure contained in the provision when terminating the contract. If there is no provision or if the party requesting early termination does not comply with the procedure provided for in the contract, the illegal termination may result in significant damage. To limit workers` rights under the common law, it is common for employers to have bonus, commission or stock option plans that stipulate that an employee must be “actively employed” by the employer to be eligible for variable compensation. However, this type of language is usually not enough to prevent an employee from successfully claiming a pro-rata bonus, commission, or stock option claim during the reasonable notice period. The wording of the plan must make it clear that the employee is not receiving variable pay even if the dismissal of the employee without notice therefore constitutes a breach of contract. Anyone dealing with a dispute over commissions, bonuses or stock options should consult a lawyer with specific expertise in that particular area of law. It`s very technical.3See Paquette v. TeraGo Networks Inc., 2016 ONCA 618 and Lin v. Ontario Teachers` Pension Plan, 2016 ONCA 619 and Andros v. Colliers Macaulay Nicolls Inc., 2019 ONCA 679; An employer has the right to terminate an employee`s employment relationship at any time and for any legal reason without giving reasons.
All the employer has to do is give the employee reasonable notice or pay instead of dismissal. For example, an employer could end an employee`s employment relationship, even if the employee is a good employee who has done nothing wrong. The employer has the right to terminate the employment relationship of his best seller. The decision may be a bad business decision (why fire your best salesperson?), but the employer has the right to do so as long as the seller receives a notice of work of his dismissal or severance pay. As a rule, an employee who is dismissed without giving reasons does not receive a prior warning regarding the termination of the employment relationship. Instead, the employee is informed during a dismissal interview that his or her employment relationship will be terminated with immediate effect. The employer gives the dismissed employee a dismissal letter containing an offer of severance pay. The purpose of severance pay is to compensate the employee for the employer`s failure to give the employee an appropriate period of notice. Most layoffs in Ontario are for no reason. The employer does not need just cause to terminate the employment relationship and therefore does not have to prove that the employee did anything wrong to justify his or her decision to dismiss the employee.
Instead, the employer is simply exercising its right to terminate the employment relationship by giving the employee reasonable notice. It is extremely common for employers to ask a potential employee to sign an employment contract that includes a termination clause that limits the employee`s rights in the event of dismissal. Employers do this in order to minimize the amount of severance pay they owe to laid-off employees. If an employee`s employment contract contains a binding termination clause, the termination clause rebuts the presumption that the employee is entitled to a reasonable period of notice and that the employee is only entitled to the termination or payments specified in the termination clause. Termination due to poor performance is sometimes considered “without”, although the cause is a lack of production or poor performance. To fire someone for this reason, it`s usually best to document performance against goals. You also want to make the employee understand, especially in formal evaluations, that their performance needs to be improved. Documented cases of poor performance and effective communication protect you from prosecution for illegal dismissal. The employer has the legal right to dismiss any non-unionized employee at any time without giving reasons, provided that the employer sets a reasonable notice period or payment in his or her place (often referred to as severance pay). The amount of entitlement to severance pay depends on the person`s situation at the time of dismissal, including age, position, seniority, availability of comparable jobs on the market and whether the employee has signed an employment contract with a termination clause. There are two different types of contract terminations, “for cause” and “for convenience”.
To view the second half of this article, please see Part 2. If you are in the process of entering into a contract, you must make the appropriate arrangements to terminate the contract. B for example a termination provision “for cause” and/or “for convenience”.