Language is power. And you can only enforce your rights if you know your rights.
The goal of this guide is to provide context and definitions for commonly used terms in provincially-regulated workplaces in Ontario, in plain language.
The guide is sorted alphabetically.
Aggravated Damages: Money awarded to an employee for the extra hurt and mental distress caused by the employer’s unfair or bad faith actions. For example, if the employer is dishonest, high-handed, or handles a termination in a cruel way. These damages recognize the personal and mental suffering beyond lost wages.
Common Law: A system of law that comes from judges’ decisions in court cases, not just from written laws made by the government. Over time, as judges decide more cases, their rulings set precedents, or examples that other judges usually follow. Written laws or statutes are the “official rulebook” and the common law is how the judges interpret and apply those rules. Judges can also develop common law principles that should be applied to similar cases.
Constructive Dismissal: This happens when an employer doesn’t fire someone directly but makes big changes to their job that force them to quit. For example, cutting someone’s pay, changing their duties, changing their work hours drastically, or creating a toxic work environment. Even though the employee technically resigned, the law may treat it as if they were fired.
Employment Standards Act (ESA): The ESA is the law in Ontario that sets the minimum rules for workplaces. It covers things like minimum wage, vacation, hours of work, and public holidays. Employers must follow the ESA, but employees can sometimes get better terms through contracts, or entitlements under the common law.
Dependent Contractor: Someone who is economically dependent on one employer, although they may be called an independent contractor. These individuals are entitled to reasonable notice of the termination of their engagement with the employer.
Discrimination: When someone is treated unfairly at work because of personal characteristics like race, gender, disability, religion, or age. It can include being passed over for promotions, being harassed, or losing a job for unfair reasons. Human rights laws in Ontario protect employees from discrimination.
Duty to Accommodate: Employers must try to make changes to the workplace so employees with disabilities, religious needs, or family responsibilities can do their jobs. For example, adjusting work hours or providing special equipment. The duty only stops if the accommodations cause the employer undue hardship. The Human Rights Code only considers three things to determine whether an accommodation would cause undue hardship: cost, outside sources of funding and health and safety requirements.
Duty of Good Faith and Fair Dealing: The duty of good faith means employers must be honest, fair, and respectful in how they treat employees, especially when ending a job. For example, they can’t mislead employees about their rights, lie to them, or fire someone in a cruel way. Courts can award extra damages if an employer acts in bad faith.
Employment Contract: An employment contract is an agreement between an employer and employee that sets out the terms of the job. It can be written, verbal, or even implied by the way people work together. Contracts usually cover things like pay, hours, duties, and termination rights.
Fixed-Term Contract: A fixed-term contract is when a job is set to last for a specific amount of time, like six months or one year, for example. At the end, the job ends automatically without notice. If the employer ends the contract early, the employee is owed pay for the full term unless there is an enforceable termination clause.
General Damages: Money paid to compensate someone for harm that isn’t just lost wages. In employment law, this could mean damages for things like mental distress, bad-faith treatment, or discrimination. It includes aggravated and general damages. General damages are meant to recognize the personal impact of the employer’s actions.
Human Rights Code: These are the rules that prevent your employer from engaging in discrimination and harassment based on a protected ground like race, disability, gender, religion and age.
Independent Contractor: An independent contractor is someone who runs their own business and provides services to clients. They control their own schedule, tools, and how the work gets done. They are not entitled to the same protections as employees, like vacation pay, termination pay and severance pay. Many independent contractors are actually employees, but are unlawfully treated like independent contractors by their employers.
Just Cause: If an employer has “just cause,” they can fire an employee without pay in lieu of reasonable notice. This usually happens if the employee does something very serious, like theft, violence, or repeated dishonesty. The standard for just cause is very high and hard for employers to prove. Unfortunately, many employers allege they are justified in terminating with just cause where there is no legal basis for doing so. You may still be entitled to termination pay and severance pay under the Employment Standards Act even if your employer can establish that it had just cause to terminate your employment.
Mitigation: Employees who lose their job must make reasonable efforts to find new work to reduce (or “mitigate”) their losses. If they don’t, it can affect how much money they get in a settlement or lawsuit.
Notice of Termination: This is the amount of warning an employer must give before ending someone’s job. It can be written notice or money in place of notice. Under section 54 of the Employment Standards Act, employees are entitled to notice of termination or termination pay if they are employed for three months or more. Section 57 describes the applicable notice period as it relates to how long you have been employed. The maximum amount of notice of termination or termination pay under the Employment Standards Act is 8 weeks.
Occupational Health and Safety Act: These are the rules that deal with workplace health and safety, and workplace harassment. It sets out the duties of employers, supervisors, and workers to prevent accidents and injuries. For example, it requires safety training, proper equipment, and the right to refuse unsafe work.
Overtime Pay: Overtime pay is extra pay for working more than 44 hours per week. It is usually paid at 1.5 times the regular hourly rate. Not all jobs qualify for overtime, like IT professionals, managers and taxi drivers, but most do.
Pay In Lieu of Notice: Instead of giving advance notice that someone’s job will end, an employer can pay the employee money equal to what they would have earned during the notice period. This is called pay in lieu of notice. It’s meant to soften the impact of sudden job loss.
Parental Leave: Parental leave is time off work to care for a new child, whether through birth or adoption. As long as you have been employed for at least 13 weeks, both parents can take it, and it can last up to 61 weeks if the employee also took pregnancy leave, or 63 weeks if the employee did not take pregnancy leave. The employee’s job is protected while they are away.
Performance Improvement Plan (PIP): A PIP is a formal plan an employer gives an employee when they aren’t meeting expectations. It usually lists specific problems, goals for improvement, and a timeline. While it is described as a tool to help the employee succeed, sometimes it is also used as a step toward discipline or termination.
Pregnancy Leave: Pregnancy leave (also commonly referred to as maternity leave) is time off work without pay for a person who has given birth. In Ontario, you are eligible for pregnancy leave if you have been employed for 13 weeks or more. The leave can be up to 17 weeks long, and can begin 17 weeks before the due date, all the way up until the day of birth. If a person stops working due to a complication caused by pregnancy because of a still-birth or miscarriage, the employee is entitled to 12 weeks’ pregnancy leave. During this time, the employee’s job is protected, and they may be able to receive employment insurance (EI) benefits.
Probationary Period: A probationary period is a trial period at the start of a job, usually three months. A probationary period does not exist unless it is explicitly written in your employment contract. During this time, the employer can end the job more easily if things aren’t working out. During the probationary period, all the employer has to establish to terminate your employment without notice is that you were not suitable for the role. After probation, employers can only terminate without notice for just cause.
Progressive Discipline: This is a step-by-step way of handling employee misconduct or poor performance. It often starts with a verbal warning, then a written warning, then suspension, and finally termination if the problem doesn’t improve. The idea is to give employees chances to correct their behaviour.
Punitive Damages: Punitive damages are extra money a court can order an employer to pay as punishment for very bad behaviour. They are not about compensating the employee, but about sending a message that the employer’s conduct was unacceptable. These damages are rare and only awarded in extreme cases.
Reasonable Notice: Reasonable notice is the amount of time or money a court thinks is fair for an employer to give before ending someone’s job. It depends on things like the employee’s age, job type, and years of service. It is more generous than the minimum notice in the ESA (about a month of notice per year of service compared to 1-2 weeks’ notice per year of service).
Release: A release is a legal document an employee signs, often in exchange for reasonable notice. By signing it, the employee agrees not to sue the employer for anything related to their employment or termination. It is important to review a release carefully before signing.
Reprisal: Reprisal means punishing an employee for standing up for their rights. For example, if someone complains about discrimination or unpaid wages and then gets demoted or fired. Reprisals are illegal under human rights and employment laws.
Severance Pay: Severance pay is payable upon a termination of employment where the employee has at least 5 years of service, and the employer has a global payroll of $2.5 million or more. The amount of severance pay is one week per year of service up to a maximum of 26 weeks.
Sick/Medical Leave: Sick leave or medical leave is time off work when an employee is too ill to work or needs medical treatment. In Ontario, the Employment Standards Act provides for at least three unpaid sick days per year, but contracts may give more. While the Employment Standards Act protects your job for only three days, the Ontario Human Rights Code protects your employment while you are away from work, unless and until a medical practitioner determines that there is no reasonable likelihood that you will return to the workplace. Therefore, under the Human Rights Code, you may be entitled to a medical leave lasting several years.
Temporary Lay-Off: A temporary layoff is when an employer stops giving work and pay for a period of time but says the employee is still technically employed. Temporary lay-offs amount to a constructive dismissal unless the employer has an implicit or explicit right to place you on a temporary lay-off. Even if your employer has the right to place you on a temporary lay-off, it can only last for a temporary period (up to 13 weeks without continuation of pay or benefits or up to 35 weeks if some benefits and pay are continued).
Termination Clause: A termination clause is a section in an employment contract that explains what happens if the job ends. It usually sets out how much notice or pay the employee will get if they are let go. Some clauses limit employees to only the minimum rights under the Employment Standards Act, while others may provide more. The vast majority of termination clauses are unenforceable and do not lawfully limit your notice entitlements upon termination.
Termination Pay (pay in lieu of notice of termination): Employers may decide to provide termination pay to an employee instead of providing them with advanced notice of the termination of their employment.
Termination Without Cause: This means an employer ends someone’s job without just cause. When someone’s employment is terminated without cause, they are entitled to common law reasonable notice, unless there is an enforceable termination clause. This is the most common type of termination.
Undue Hardship: Undue hardship is the point where accommodating an employee becomes too unsafe or expensive for the employer. For example, if making a change would cost too much or cause safety risks. Until that point, employers must accommodate.
Vacation Pay: Vacation pay is money employees earn while working that lets them take paid time off. In Ontario, the minimum is 4% of wages for the first five years and 6% after that, but your employment contract might offer more. It ensures employees can take a break without losing income.
Wages: Wages are the money an employee earns for their work. This includes salary, hourly pay, commissions, and sometimes bonuses. Employers must pay wages regularly and at least the minimum wage.
Working Notice: Working notice is when an employer tells an employee their job will end on a certain date, but the employee continues working until then. For example, “your job will end in eight weeks.” The notice period is meant to give the employee time to prepare for the change. Most employees prefer not to receive working notice so that they can spend all of their time job searching during the notice period.
Workplace Harassment: Workplace harassment is when someone makes comments or actions that are unwelcome and create a hostile or uncomfortable work environment. It can include bullying, yelling, offensive jokes, unwanted advances, or repeated mistreatment. The Occupational Health and Safety Act requires employers to prevent and deal with workplace harassment
Wrongful Dismissal: It’s when an employer fires an employee without giving enough notice, pay, or following the law. It’s one of the most common reasons people seek employment lawyers in Ontario.
Workplace Sage Legal can provide you with tailored legal guidance for any workplace issue, to ensure that you protect your legal rights and any potential compensation (if any) as best as possible. Book a consultation today.
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While reasonable efforts have been made to ensure the accuracy of the content provided, it does not constitute legal advice. Prior to relying on any aspect of this article, you should consult with a suitably qualified legal professional promptly in your relevant jurisdiction, to obtain advice tailored to your individual circumstances
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