non disparagement clause
16Sep

Understanding Non-Disparagement Clauses

When employees and employers part ways, whether through termination, resignation, or settlement, it is common for agreements to include a non-disparagement clause. While these clauses are often presented as routine, they can significantly affect what an employee is allowed to say about a former employer, managers, or colleagues after the relationship ends.

In Ontario, non-disparagement clauses are generally enforceable, but they are not unlimited. Their scope, wording, and interaction with statutory rights all matter. This article explains how non-disparagement clauses work under Ontario law, what employees may be giving up by agreeing to one, and when legal advice is essential.

📍 Not in Ontario?

If you’re an employee in British Columbia, the law works differently. See our BC-specific article about non-disparagement clause.

What Is a Non-Disparagement Clause?

A non-disparagement clause is a contractual promise not to make statements that could harm the reputation of an employer or related individuals. These clauses commonly appear in:

The purpose is to protect the employer’s reputation and business interests by limiting negative public or private commentary after the employment relationship ends.

The exact wording varies, but many clauses prohibit statements that are “negative,” “critical,” or “derogatory,” whether spoken, written, or shared online.

The Scope of Non-Disparagement Clauses in Ontario

Non-disparagement clauses can extend beyond obvious public criticism. Depending on the language, they may capture:

  • Social media posts
  • Conversations with former co-workers
  • Statements to clients, vendors, or industry contacts
  • Encouraging others to criticize the employer on your behalf

Importantly, context matters. Even statements that feel informal or private may be treated as a breach if they reasonably harm the employer’s reputation.

📌Key Point

In Ontario, courts focus on the wording of the clause and the surrounding circumstances not just the employee’s intent.

Christopher Achkar - Employment Lawyer

As Christopher Achkar, employment lawyer and founder of Achkar Law, explains:

“Non-disparagement clauses can quietly limit what you’re allowed to say long after your employment ends, often with serious consequences if misunderstood. Before agreeing to, or breaching, any such clause, employees should speak with an employment lawyer to fully understand their rights and risks.” 

Key Limitations on Non-Disparagement Clauses

While these clauses can be broad, they are not absolute.

1. Statements Made Before the Agreement

Non-disparagement clauses generally apply only after the agreement is signed. Statements made before that date are usually not captured unless the clause explicitly says otherwise.

2. Neutral or Factual Statements

Purely factual, non-pejorative statements are less likely to be considered disparaging. For example, saying:

  • “My employment ended pursuant to a settlement,” or
  • “The lawsuit was resolved.”

Without negative commentary will often fall outside the clause.

That said, decision-makers will look at tone, context, and implications, not just literal wording.

Statutory Rights Cannot Be Contracted Away in Ontario

A critical limit under Ontario law is that non-disparagement clauses cannot override statutory rights.

Even if an agreement includes a non-disparagement clause, it cannot lawfully prevent an individual from:

  • Filing or participating in a complaint under the Ontario Human Rights Code
  • Reporting workplace safety issues or reprisals under the Occupational Health and Safety Act
  • Making complaints under the Employment Standards Act, 2000
  • Cooperating with regulatory or law-enforcement investigations

Courts and tribunals in Ontario will generally refuse to enforce contractual provisions that attempt to block access to statutory protections or reporting mechanisms.

📌Public Policy Matters

In Ontario, contracts that interfere with human rights enforcement, workplace safety reporting, or employment standards may be unenforceable as contrary to public policy.

Consequences of Violating a Non-Disparagement Clause

Once an employee agrees to a non-disparagement clause, compliance is critical.

Potential consequences of a breach include:

  • Repayment of severance or settlement funds
  • Loss of remaining payments under a structured agreement
  • Damages for reputational harm
  • Injunctions requiring the employee to stop making statements

Many agreements expressly tie severance or settlement compensation to compliance. Even where no specific penalty is listed, courts may still award damages if a breach is proven.

Can Non-Disparagement Clauses Be Negotiated?

Yes, often they can.

Employees frequently assume these clauses are non-negotiable, but that is not always true. Depending on leverage and circumstances, it may be possible to:

  • Narrow the definition of “disparagement.”
  • Limit the clause to public statements only
  • Exclude truthful statements or professional references
  • Add reciprocal non-disparagement obligations for the employer
  • Clarify that statutory reporting rights are preserved

A lawyer can help assess whether the language is reasonable and propose revisions that reduce future risk.

When to Seek Legal Advice

Employees should strongly consider legal advice before signing a non-disparagement clause, particularly where:

  • The language is broad or vague
  • Significant compensation is at stake
  • The employee may need to speak openly in the future (e.g., regulated professions, litigation history)
  • There are ongoing human rights, safety, or employment standards issues

Legal advice can help avoid unintended breaches and clarify what speech is still permitted.

Conclusion

Non-disparagement clauses are common in Ontario employment agreements, but they are not merely boilerplate. They can meaningfully restrict what an employee may say after leaving a job and carry serious financial consequences if breached.

Understanding the scope, limits, and interaction with statutory rights is essential before agreeing to these terms. Careful review, and, where appropriate, negotiation, can help protect an employee’s future while still allowing an agreement to move forward.

Need Guidance on a Non-Disparagement Clause?

If you are being asked to sign a non-disparagement clause, negotiating a settlement, or concerned you may have breached an agreement, it’s important to understand your rights and obligations under Ontario law.

An employment lawyer can review the clause, explain the risks, and help you make informed decisions before problems arise.

Contact Achkar Law to discuss your situation and get clear, practical advice tailored to Ontario employment law.

The article in this client update provides general information and should not be relied on as legal advice or opinion. This publication is copyrighted by Achkar Law Professional Corporation and may not be photocopied or reproduced in any form, in whole or in part, without the express permission of Achkar Law Professional Corporation. ©