Termination with notice clause was stand-alone clause

Labour and Employment Law - Employment law - Termination and dismissal

Employer terminated employee’s employment as director of sales, without cause, after eight months’ employment. Parties had employment agreement that provided for one week pay in addition to minimum pay in lieu of notice under Employment Standards Act. Agreement contained clause for termination for cause, which parties agreed was unenforceable. Agreement contained clause rendering any illegal clause severable from rest of agreement. Employee asserted unenforceable clause rendered entire agreement void. Employee brought action for wrongful dismissal damages. Employer brought motion for summary judgment dismissing action. Motion granted. Termination with notice clause applied and did not require re-wording. Termination with notice clause was stand-alone clause and was enforceable without reference to termination for cause clause. Only termination with notice clause applied and there were no grounds to challenge its enforceability. Employer acted within its rights under agreement and paid employee two weeks’ severance pay and car allowance. While this was less than what employee would receive at common law, it was more than Employment Standards Act minimum.

Waksdale v. Swegon North America Inc. (2019), 2019 CarswellOnt 15653, 2019 ONSC 5705, E.M. Morgan J. (Ont. S.C.J.).

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