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ARTICLE · 03 JULY 2013

"And Benefits" – Two Missing Words Invalidate A Termination Provision

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Employers and their counsel keep trying to produce employment contracts which will stand up to judicial scrutiny. Termination provisions are among the most important – and vulnerable – terms of any contract.

CanadaEmployment and HR
Mark Josselyn
Mark Josselyn
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Employers and their counsel keep trying to produce employment contracts which will stand up to judicial scrutiny. Termination provisions are among the most important – and vulnerable – terms of any contract.

The Ontario Superior Court of Justice in Stevens v. Sifton Properties Ltd., 2012 ONSC 5508 (CanLII) (Justice Leach – Oct. 9, 2012) ("Stevens") provides what should be a cautionary tale for employers and the drafters of employment contracts. This decision confirms that benefits reflecting at least minimum legislative requirements must be explicitly included in termination provisions in order for the provisions to be valid and enforceable.

The former employee and plaintiff Stevens sought greater damages than what had been originally agreed in the contractual termination provision. Sifton wanted to enforce the contract. In the decision, Justice Leach was asked to consider the enforceability of a contractual termination provision on a motion pursuant to Rule

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