In Canada, if an employer wishes to terminate an employee
without cause, it must provide notice or pay in lieu thereof. In
other words, unlike in the United States, Canada does not have
employment at-will. American businesses operating in Canada may
find that Canadian employees whose employment has been terminated
without cause will be entitled to no less than one month
per year of service if a judge is left to decide an employee's
severance package. For this reason, employment contracts—and,
specifically, the termination clauses in those contracts—are
essential to controlling severance costs in Canada.
Two regimes govern the entitlement to notice of termination in
Ontario: the Employment Standards Act, 2000 (ESA) and the
common law (i.e., case law). If terminated without cause, an
employee is presumed to be entitled to common law notice (or pay in
lieu thereof), unless there is an enforceable termination provision
in the employee's contract of employment that ousts
