Common Law Reasonable Notice of Termination
When an employee experiences dismissal from the workplace without cause, a key legal issue of reasonable notice of termination is the appropriate amount of notice the employee should receive if they are being dismissed.
Before we delve into this topic, remember that where an employee is dismissed for just cause (a high threshold for an employer to meet), the employee is not entitled to any notice. Also, if an employee is a federally regulated employee or is unionized different rules apply.
What Does Ontario’s Employment Legislation Say?
The responsibilities of employers and minimum rights of a provincial employee are outlined in legislation titled the Employment Standards Act (“ESA”) regarding common law reasonable notice of termination.
The ESA and its regulations outline an employee’s minimum entitlements upon termination at Part XV. For instance, an employer cannot terminate an employee (employed for at least three months) without giving the employee written notice of termination or pay instead of this written notice.
This minimum amount of notice is generally one week of notice per year of service, up to 8 weeks of notice or pay in lieu of notice. (Keep in mind there are variations to this, such as if an employer terminates 50 or more employees within a certain period.)
An example of applying the legislated requirements is if ABC Company has employed Susie for 4.5 years and ABC Company decides that they will terminate Susie’s employment, the minimum amount of written notice Susie must receive under the ESA is four weeks. That means ABC Company may tell Susie that her last day of work will be at the end of the month. Where an employee is required to continue working until the end date, s/he has been provided with “working notice.”
Alternatively, ABC Company may tell Susie that her last day is today and provide her with four weeks of his compensation. This is an example of pay-in-lieu of working notice.
Many employers choose to provide a combination of working notice and pay-in-lieu. In addition to termination pay, certain long-term employees are also entitled to severance pay.
Other Legislations That Apply to Common Law Reasonable Notice of Termination
If an employee is terminated for an illegal or discriminatory reason, they may be entitled to various other types of awards.
The Ontario Human Rights Code (the “Code”) protects the rights of employees and other types of workers to equal treatment in the workplace without discrimination, based on the listed grounds in the Code.
If you suspect that you were terminated based on discriminatory reasons (e.g., related to your disability, race, age, gender, etc.), you should seek legal advice right away.
What Is Common Law And When Does It Apply?
Now that we understand what Ontario’s employment legislation says about reasonable notice of termination, how does common law come into play?
Many employees are surprised to learn that they are not limited to the minimums in employment legislation. For an employee to be limited to receiving only the minimums in the ESA, the employee must have executed an enforceable employment contract that validly limits the notice amounts to those listed in the ESA.
Employers often attempt to limit an employee’s entitlements upon termination by including a provision in the employment contract called a “termination clause.” Countless cases assess the validity of a termination clause, and many termination clauses have been found to be invalid.
Where an employer has not successfully limited the employee’s entitlements upon termination, the employee is typically entitled to reasonable notice at common law.
Common law refers to a body of unwritten laws developed over time through judges deciding cases. Where an employee is not limited to amounts in the ESA, the assessment of how much notice the employee should have received is based on previous legal cases and relevant factors. The range of notice an employee should receive, based on judge-made law, is what the phrase “reasonable notice at common law” generally means.
How to Assess Reasonable Notice of Termination
Assessing the reasonable notice of termination an employee is entitled to is fact-specific and legally complex. Out of the hundreds of relevant factors, five common factors are often cited in deciding how much common law notice an employee should receive. These are referred to as the Bardal factors, named after a 1960 case. These factors are:
- The nature and character of the employment;
- Length of service;
- Age of the employee, and
- The likelihood of securing similar employment considering the employee’s experience, training and qualifications.
Although these Bardal factors are commonly discussed, remember they are a starting point. Determining reasonable notice of termination at common law is art rather than a science. It is recommended that you contact an experienced employment lawyer to assess your case and estimate what you may be entitled to upon termination.
If you are an employer looking to dismiss an employee or an employee who has been dismissed, our team of experienced employment lawyers at Achkar Law can help.