Last week, the Ontario Court of Appeal released yet another decision on the interpretation and enforceability of termination clauses: Amberber v. IBM Canada Ltd., 2018 ONCA 571. Recent appellate decisions on this issue have been inconsistent and/or provided less than clear guidelines, see here, here, here and here. In contrast, Amberber is a bright spot for employers. The Court not only reaffirmed the principle that termination clauses must be interpreted as a whole, but also held that courts should not strain to create an ambiguity where none exists.
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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
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Many employers rely on the discretionary nature of their bonus plans to deny bonuses to employees they’ve dismissed. However, in last month’s decision in Singer v Nordstrong Equipment Limited, 2017 ONSC 5906, the Court held that stipulating that a bonus is discretionary in the policy doesn’t necessarily give the employer complete freedom to withhold the bonus. Rather, discretionary bonuses must be awarded through a “fair, identifiable process.”
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The Supreme Court of Canada (“SCC”) recently ruled that a unilateral contract renewal clause was valid, despite its potential to bind one party perpetually: Uniprix inc. v. Gestion Gosselin et Bérubé inc. The clause afforded sole discretion to the respondents to renew or terminate their contract with Uniprix. The wording of the clause, the nature of the contract and the relationship between the parties were determinative in the majority’s ruling, which upheld the decisions of the Court of Appeal and the Superior Court of Quebec. The SCC’s decision and our key takeaways are outlined below.
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In the recent decision of Covenoho v. Pendylum Ltd., 2017 ONCA 284, the Ontario Court of Appeal put an end to any debate about the enforceability of termination provisions in employment agreements that may violate minimum employment standards legislation in the future. The takeaway for employers from the case is as simple as it is noteworthy: a termination provision that breaches minimum employment standards legislation in the future – even if compliant at the time of the employee’s termination from employment – is void and therefore will not be enforced.
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On July 14, 2016, the Supreme Court of Canada confirmed that most federally-regulated, non-union employees can only be dismissed for “just cause” after 12 consecutive months of service (Wilson v. Atomic Energy, 2016 SCC 29). As a result of this decision, it is now clear that employees who are regulated under Part III of the Canada Labour Code cannot, following their first year of employment, simply be provided with termination notice or pay in lieu, absent a compelling reason for terminating the employment relationship.
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This two-hour CLE program will provide in-house counsel, HR professionals and business leaders with practical guidance and checklists to tackle the key issues that arise when their company moves into new jurisdictions around the world. We will look at three critical elements of international expansion:

  1. Getting the Structure Right, Early.  What factors do you consider when choosing the type of business entity to use for a particular type of business, long term objective and country?  Understand the impact your choice of business entity can have on your future business and related legal issues.
  2. Realities of Global Employment.  What are the most significant international employment, hiring and termination issues for in-house counsel dealing with international expansion and ongoing operations? Take away strategies to help you avoid the biggest pitfalls and successfully manage a global workforce.
  3. Equity Compensation.  How are companies thinking about equity outside of Canada? Learn whether the use of equity grants to provide future incentives and variable compensation for executives and other employees is available or advisable in other jurisdictions in light of securities law, tax withholding/reporting, exchange controls and other requirements.


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The Supreme Court of Canada (“SCC“) has clarified and expanded the scope of “constructive dismissal”. In Potter v. New Brunswick Legal Aid Services Commission, the SCC held that placing an employee on paid administrative (i.e. non-disciplinary) leave can constitute constructive dismissal. The SCC determined that employers are required to act in good faith towards their employees and, unless explicitly authorized by the employment contract, employers cannot place employees on leave, even if paid, without providing legitimate business justification. Where an employer fails to do so, the suspension will be viewed as an unauthorized breach of the employment contract, amounting to “constructive dismissal” of the employee, who can then sue the former employer for compensation.
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Many believe that what employees do on their own time should not be regulated by employers, but the boundary between the workplace and an employee’s private life is not absolute. As recent high profile cases have demonstrated, some off-duty misconduct, such as criminal or morally reprehensible behaviour, may invite discipline or even dismissal of employees.

It is generally accepted that employers can regulate employees’ conduct in the workplace through the promulgation of reasonable rules, policies and procedures. Increasingly, however, employers are facing difficult decisions concerning employee misconduct that occurs outside the workplace.

While the line can be difficult for employers to draw, employers should consider the following guidelines in determining whether an employee can be properly disciplined or dismissed for off-duty misconduct.
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