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ARTICLE · 11 JANUARY 2022

Non-compete Clauses In Ontario: Status And Potential Application Of Bill 27

By now, most employers know that Bill 27, the Working for Workers' Act (the "Act"), prohibits employers and most employees from entering into non-competition agreements ("non-competes").

CanadaEmployment and HR

By now, most employers know that Bill 27, the Working for Workers' Act (the "Act"), prohibits employers and most employees from entering into non-competition agreements ("non-competes"). At this point, we have limited information about how this will be implemented and treated by the Courts.

  • We know that the prohibition does not apply to non-competes entered into before October 25, 2021, based on the Ministry of Labour's statement on its website. However, we also know that it was difficult to enforce non-competes before passage of the Act - this will not make it any easier.
  • We know that there are some exclusions to the application of this provision, including where the seller of a business agrees to a non-compete as part of the sale transaction, and for so-called "C-suite" executives (CEO, CFO, etc.).

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