Termination of employment is something every employer dreads. In Ontario, employers have the right to not provide a reason for ending employment, which is known as "termination without cause".
Termination of Employment
In Ontario, termination of employment can happen in one of two ways: termination without cause or termination for cause. Letting an employee go is never easy, but employers should be aware of the guidelines for terminating employment in the Employment Standards Act (ESA). According to the ESA, an employee is terminated if the employer does the following:
- Dismisses or stops the employee’s employment due to bankruptcy or insolvency
- Constructively dismisses an employee and they resign
- Lays an employee off for a length of time greater than a temporary layoff
What is Termination Without Cause?
In Ontario, employers are not required to give an employee a reason for why they are being terminated. This is known as “termination without cause”. When employment is terminated without a reason, employers must provide written notice, termination pay, or a combination of both.
Termination without cause means that employers do not need a good reason to terminate employment. That does not mean that employers can end employment for any reason, however. If an employee is let go for asking about the ESA, exercising a right under the ESA, or for taking leave under the ESA, they may have a case for wrongful termination. Employees that feel they were wrongfully dismissed can take their case to court, however, they cannot file a claim for termination or severance pay if they do so.
Ontario Employers and Termination Without Cause
There are a number of terms used to describe the termination of employment: discharged, dismissed, fired, laid off, let go. Employers know that calling it something different doesn’t make it any easier. Terminating employment is never a simple task, whether or not there is a cause. In order to avoid wrongful termination cases or other legal matters, employers should consult with HR experts and have a termination policy in place.