Courts usually treat incentive compensation as part of the compensatory damages owed in lieu of common law reasonable notice of dismissal. However, if the employment contract and/or the incentive plan unambiguously extinguish entitlement to incentive compensation upon notice of dismissal, the agreement(s) will generally prevail over the common law entitlement. In O’Reilly v. IMAX Corporation, the Ontario Court of Appeal once again stressed the importance of using precise language in bonus or stock option plans to deny, or otherwise limit, employee entitlement to incentive compensation during the reasonable notice period.
Continue Reading Avoiding the Cost of Imprecise Language in Incentive Compensation Plans
24 Months Reaffirmed as the “High End” of Reasonable Notice; Bonus Plan Changes Must Be Accepted by Employee
The Ontario Court of Appeal has reiterated that, barring exceptional circumstances, reasonable notice for dismissal without cause will not exceed 24 months. The Court partially overturned the lower court’s decision in Dawe v The Equitable Life Insurance Company of Canada, which also ruled on the enforceability of unilateral changes to the employer’s bonus plan.
Continue Reading 24 Months Reaffirmed as the “High End” of Reasonable Notice; Bonus Plan Changes Must Be Accepted by Employee