Employment Update

Ontario Court Finds Termination Clause Invalid, Employee Receives $150K in Damages

Ontario employers, including charities and not-for-profits, may need to update their employment contracts again to ensure the language in termination clauses complies in exacting detail with provincial minimum employment standards legislation. In Dufault v The Corporation of the Township of Ignace, a wrongful dismissal decision published February 16, 2024, the Ontario Superior Court (the "Court") struck down the termination clause in the fixed-term contract (the "Contract") between the plaintiff, Karen Dufault (the "Employee"), and the defendant, the Township of Ignace (the "Employer"). The Court found that certain language in both the "for cause" and "without cause" sections of the Contract's termination clause contravened parts of the Employment Standards Act, 2000 (ESA) and therefore the entire termination clause was deemed not enforceable. That left the Employee with damages for