Why You Need to Know the Actual Meaning of Wrongful Dismissal

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Although the term “wrongful dismissal” sounds similar in meaning to an employee who is terminated without justification, under Ontario employment laws, it has a very different and specific meaning. Knowing the legal definition of wrongful dismissal/termination is crucial for most people working in Ontario because wrongful terminations happen a lot more than you would think.

Wrongful Dismissal in Ontario

Workers in Ontario who are not unionized or a federal employee can be terminated by their employer at any time and without having done anything wrong, or even being given a reason for the termination. However, if an employer terminates an employee without cause, the employee is entitled to reasonable notice that they are being terminated ahead of the official termination.

The right to notice is a provision given to employees covered by the Employment Standards Act (ESA).

It’s meant to act as a “bridge” between the end someone’s employment and commencing new employment. It protects employees from being “ambushed” and suddenly left without an income and having to scramble to find work. 

During the notice period, an employer can require the terminated employee to continue working until the notice period ends or they can end the employment immediately and pay the employee the wages that would have been earned during the notice period – this is known as “pay in lieu of notice.”

Wrongful dismissal is when an employer doesn’t provide the employee with the proper amount of notice, or pay in lieu of notice, they are entitled to by law – depriving them of income when they need it most.

How Much Notice are Workers Allowed?

Under the ESA, the notice period is determined by the length of your service. Currently, employees are entitled to a minimum of one week of notice for every year of service to a maximum of eight weeks. 

However, the ESA is only the minimum notice period allowed in Ontario. Many Ontarians have a notice period spelled out in their employment contracts. That notice cannot be less than what’s provided for in the ESA for that clause to be enforceable. 

Workers in Ontario, however, are often entitled to more than the minimum provided for by the ESA. As the wording of the law provides that an employee is entitled to “reasonable notice,” judges hearing wrongful termination cases have ruled, and continue to rule, that what’s provided by the ESA is not reasonable in many circumstances.  It all depends on what your contract of employment or job offer letter might contractually limit you to for notice.

In other words, since the notice period is intended to give someone enough time to find a new job, judges are ruling that the ESAminimum does not provide them with a reasonable amount of time to do so, considering their personal circumstances.

While there is no formula that judges use to calculate a reasonable notice period, they typically consider: 

  • the character of the employee’s employment;
  • the length of the employee’s service;
  • the employee’s age; and 
  • the employee’s prospects for future employment.

This means that if you are terminated and your employer only provides you with the minimum notice period in the ESA, as happens regularly, you may have been wrongfully dismissed and entitled to more than you were offered as pay in lieu of notice.  

If you were terminated without cause, it’s crucial you reach out to one of the employment law firms in Toronto with an established history of litigating wrongful termination cases. This way you’re assured that you’re getting an honest and accurate opinion on the merits of your case.

If you are offered a severance agreement, do not sign it until you speak with an employment lawyer. Despite what your employer says, you do not have to make a decision on the spot.

Final Thoughts on Wrongful Dismissal

If you voluntarily left your employment, or are fired with cause (i.e., just cause) you are not entitled to notice or pay in lieu of notice unless:

  • You quit because your employer made fundamental changes to your employment without your consent. This may be considered constructive dismissal, which could entitle you to notice.
  • Your employee terminated you “for cause” when they had no grounds to do so. Terminations for cause are meant for the most severe incidents of misconduct such as theft, fraud or insubordination.

Every case is difference so always speak to an employment lawyer before making any important decisions that impact your employment.

Christophe Rude
Christophe Rude
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