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

Employers who include discretionary bonuses as part of their employees’ compensation packages should be aware of the Ontario Court of Appeal’s latest guidance on (i) bonus entitlement for the period up to dismissal and (ii) compensation for the loss of a bonus during the reasonable notice period. This guidance came in the Court’s decision, issued last week, in Singer v. Nordstrong Equipment Limited, 2018 ONCA 364. Our analysis of the lower court’s decision in this case can be found here
Continue Reading Is Your Dismissed Employee Entitled to a Bonus?