Over the past several years, Canadian courts have taken a proactive stance in scrutinizing restrictive termination provisions in employment contracts. This judicial trend stems from a commitment to ensuring that employees are not deprived of their common law entitlements upon termination.
It is well-established law that an employer is permitted to displace the common law presumption of reasonable notice and, specifically, to limit an employee's entitlements upon termination through clearly drafted termination provisions in employment contracts. These provisions are valid and enforceable provided (i) they do not run afoul the minimum requirements of applicable employment standards legislation in the province in which the employee works, and (ii) the language is clear and unambiguous.
Please log in to read the full article.