Termination Clauses - RSUs - and Employee Rights - Lessons from Wigdor v Facebook
10Sep

Lessons from Wigdor v Facebook: Termination Clauses, and More

In July 2025, the Ontario Superior Court of Justice released its decision in Wigdor v. Facebook Canada Ltd., 2025 ONSC 4051. The ruling highlights key lessons for employees in Ontario when it comes to termination clauses, stock-based compensation, and what to expect if an employer mishandles entitlements.

The Case in Brief

Daniel Wigdor, a senior research science director with Facebook Canada (a subsidiary of Meta), was terminated without cause in December 2023. The dispute centered on three important questions:

  1. Was the termination clause in his employment contract enforceable?
  2. Was he entitled to Restricted Stock Units (RSUs) that would have vested during his statutory notice period?
  3. Did Meta’s handling of his termination warrant extra damages?

Court’s Decision

1. Termination Clause Unenforceable

The Court struck down the termination clause because it violated the Employment Standards Act, 2000 (ESA). Despite Meta including a “saving clause” that promised compliance with the ESA, the wording of the contract attempted to provide less than the legal minimums provided for under sections 54, 57 and 63 of the ESA .

  • Result: The entire termination clause was void, and Mr. Wigdor was awarded 10 months’ common law notice.

2. No RSU Vesting After Termination

Mr. Wigdor argued that he should receive RSUs that would have vested during the notice period. The Court disagreed, ruling that RSUs are not considered wages under the ESA and can be forfeited upon termination if the plan says so.

  • Result: RSUs did not continue to vest after his last day of work.

3. No Punitive Damages Despite Delays

Meta delayed paying Mr. Wigdor his statutory entitlements for nearly 10 months and initially cut off his benefits early. The Court criticized this conduct but decided it was not extreme enough to justify punitive damages.

Christopher Achkar - Employment Lawyer

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

“Termination clauses and RSUs can be complex and are often drafted to limit what employees may be entitled to. Before signing or accepting a package, speak with a lawyer to ensure your rights and compensation are fully protected.” 

What Employees Should Know

1. Termination Clauses Are Often Struck Down

a. Many employment contracts in Ontario contain termination provisions that violate the ESA.
b. If struck down, employees are entitled to common law notice, which is often significantly higher than ESA minimums.

2. Stock Options and RSUs Are Complex

a. RSUs and similar forms of equity compensation are not automatically protected during a notice period.
b. Employees should carefully review their equity agreements before signing and seek legal advice if terminated.

3. ESA Minimums Must Be Paid Promptly

a. Employers cannot withhold or delay ESA minimum entitlements, even if negotiations are ongoing.
b. If these payments are delayed, employees may have grounds to pursue additional damages flowing from their employer’s conduct in the course of the dismissal.

Key Takeaway

The Wigdor case is an important reminder that:

  • Employees should not assume their employment contract is enforceable as written.
  • Common law notice can provide significantly more compensation than an employer may first offer.
  • RSU and stock option agreements need close review, as they often contain strict forfeiture clauses.

Contact Achkar Law

If you’ve been terminated, it’s crucial to have both your employment agreement and compensation package reviewed. What may appear to limit your rights on paper may not hold up in court. 

 Call toll-free: 1-800-771-7882 | Email: [email protected]

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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. ©

Workplace Law Topics: Termination and Severance, Wrongful Dismissal, Employment Dispute and Litigation, Employee Contracts