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Wigdor v. Facebook: What an Unenforceable Termination Clause and a 10-Month ESA Delay Cost Meta in Ontario
A saving clause does not save a defective termination clause. Meta learned this in July 2025 when the Ontario Superior Court struck down the termination clause in Daniel Wigdor's employment contract and awarded 10 months of common law notice despite the contract's explicit promise to comply with the Employment Standards Act, 2000. The decision in Wigdor v. Facebook Canada Ltd. (2025 ONSC 4051) offers three distinct employer lessons: on termination clause drafting, on equity compensation at the time of dismissal, and on the risks of delaying ESA minimum payments.
Does your employment contract contain a termination clause with a saving clause that promises ESA compliance?
The Wigdor decision confirms that a saving clause does not cure underlying defects. If your termination clause attempts to provide less than ESA minimums anywhere in its wording, the entire clause may be void. Get your contracts reviewed before you rely on them.
Call: 1-800-771-7882 Speak With an Employment LawyerWhat happened
Daniel Wigdor was a senior research science director with Facebook Canada Ltd., a subsidiary of Meta. He was terminated without cause in December 2023. His employment contract contained a termination clause that the employer argued limited his entitlement to ESA minimums, supported by a saving clause stating the contract would comply with the ESA. The dispute raised three issues: whether the termination clause was enforceable, whether RSUs that would have vested during the notice period were owed, and whether Meta's handling of the termination warranted additional damages.
What the Court decided
The termination clause was void despite the saving clause
The Court found that the termination clause violated sections 54, 57, and 63 of the ESA it attempted to provide less than the statutory minimums in its express wording. The saving clause promising ESA compliance did not cure this defect. Once a clause is found to violate the ESA, the entire clause is struck and common law notice applies. Wigdor was awarded 10 months of common law reasonable notice.
RSUs did not vest during the notice period
Wigdor argued he was entitled to RSUs that would have vested during the common law notice period. The Court disagreed. RSUs are not wages under the ESA and are governed by the terms of the equity plan. Where the plan contained a clear forfeiture clause on termination, the RSUs did not continue to vest after his last day of active work. The equity plan terms prevailed.
Delaying ESA payments was criticized but did not attract punitive damages
Meta delayed paying Wigdor his statutory ESA entitlements for nearly 10 months and cut off his benefits early. The Court criticized this conduct but found it did not reach the threshold of malicious or oppressive behaviour required for punitive damages. The conduct was found to be unreasonable but not egregious enough to warrant additional punishment beyond the notice award.
Three employer lessons from this decision
A saving clause is not a substitute for a compliant termination clause
Meta's termination clause included an explicit promise to comply with the ESA. It was struck anyway because the underlying language violated the Act. Ontario courts do not use saving clauses to rehabilitate defective termination provisions they void the clause and award common law notice. The only reliable protection is a termination clause that is correctly drafted from the outset. If your contracts contain saving clauses over termination provisions you have not recently reviewed, get them assessed now. The cost of a contract review is a fraction of a 10-month common law notice award.
Equity compensation at termination is governed by the plan, not by the notice period
Where an RSU or equity plan contains a clear forfeiture clause on termination, RSUs will generally not vest during the common law notice period. This outcome is favourable to employers but it depends entirely on how the equity plan is drafted. Ambiguous or poorly worded forfeiture clauses are regularly challenged and have been found insufficient in other cases. If you offer RSUs, stock options, or other equity-based compensation, ensure your plan documentation is unambiguous about what happens on termination and in what circumstances forfeiture applies. This is one area where the investment in proper drafting pays significant dividends.
Delaying ESA minimum payments is legally risky even when it does not attract punitive damages
Meta delayed Wigdor's statutory ESA entitlements for nearly 10 months. The Court criticized this conduct clearly, even though it declined to award punitive damages on the facts. Employers should not interpret the absence of punitive damages as permission to delay. ESA minimum entitlements termination pay, severance pay, and benefits continuation are owed immediately and cannot be withheld while negotiations are ongoing. Delays create litigation risk, attract judicial criticism, and in more egregious cases will support additional damages. Pay the statutory minimum promptly and negotiate any enhanced amount separately.
When did you last have your employment contracts reviewed for ESA compliance?
The Wigdor decision is a reminder that termination clauses including those with saving clauses fail regularly in Ontario courts. Our team advises employers across Ontario on terminations and employment contracts. Get your contracts reviewed before you need to rely on them.
Get Your Contracts Reviewed Or call us: 1-800-771-7882Practical takeaways for Ontario employers
Questions about termination clause compliance or equity compensation on dismissal in Ontario?
Our team advises employers across Ontario on employee terminations, employment contract drafting, and wrongful dismissal defence. Contact us for a confidential consultation before your next termination.
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