By: Stephanie McDonald and Baljinder (Bal) Singh Tiwana
Thinking about resigning? Before you resign, make sure you understand your employment rights under Ontario law. The way you resign can have substantial legal and financial consequences—from losing unpaid commissions or bonuses to breaching post-employment restrictions.
This guide explains key concepts that Ontario employees need to know before resigning: how to secure your final pay, commission, and bonus entitlements; how to diligently manage your new job prospects; and how to protect confidential information when changing jobs.
With the right employment law strategy, you can resign confidently, stay compliant with your obligations upon a resignation, and protect your income, career, and reputation as you move forward.
Resignation Notice Period
Employees in Ontario are required to give reasonable notice of their intention to resign. For most employees, reasonable notice is 1-2 weeks. For C-suite level executives or other employees whose services are essential to the operation of the employer’s business, more notice may be required.
Your employment contract may specify the period of notice expected by your employer. Never offer more notice than is required by your employment contract. If you plan on offering less notice than is required by your employment contract, make sure you speak with an employment lawyer first to avoid unnecessary risks.
Rights to Bonus, Commission, and Salary Upon Resignation (Ontario)
1. Salary
When you resign in Ontario, you are entitled to all wages earned up to your final day of work. This includes your full salary for hours worked and any accrued but unpaid earnings.
2. Commission
Commission is considered a wage under Ontario’s Employment Standards Act, 2000 (ESA). Employers must pay commissions when they are considered earned—but the timing of payment depends on your commission agreement.
The agreement should clearly specify when a commission is earned and payable. For example:
- It may state that commission is earned once the “deal is executed”; or
- It could require that the “employer receives funds from the client” before the commission is earned
If you resign before that event occurs, you could lose (i.e. forfeit) your unpaid earnings.
Key Rules:
- If you completed all required work before resigning, you’re generally entitled to the commission, even if it’s paid later
- If the commission depends on a future event, your entitlement depends on the contract’s wording
Ambiguous or unfair clauses are often interpreted in favour of the employees, especially when they have already done most of the work to secure the sale.
3. Bonuses
Bonuses fall into two main types:
- Discretionary bonuses: that do not form an essential part of your compensation and are based on employer discretion or goodwill—typically not owed after resignation
- Non-discretionary bonuses: Tied to performance, hours, production, efficiency or a contractual promise—may still be owed if you met the criteria before leaving
Courts in Ontario require clear, fair language to limit bonus rights. If the written agreement is vague, you may still be entitled to payment.
Caution: Don’t resign in Ontario until your bonus is deposited in the bank! Many agreements require employees to not have resigned before the payout date. Even if you have a legal right to your bonus, leaving your job before the bonus is paid could jeopardise your ability to receive those in a timely manner, or at all, because the employer may refuse to pay it.
No Right to Employment Insurance (EI) on Resignation
Generally, employees who resign voluntarily are not eligible for EI benefits. The Employment Insurance Act provides support only for those who lose their job through no fault of their own—such as layoffs or lack of work.
You may still qualify if you can prove “just cause” for quitting, such as constructive dismissal, harassment, discrimination, or unsafe working conditions.
What to Do if Your Employer Waives Your Resignation Period Without Pay
If your employer asks you to leave immediately after you resign, they must still pay you through your notice period unless otherwise agreed. If they fail to do so, your employment is considered terminated and you are entitled to notice of termination and severance pay under the Employment Standards Act and common law reasonable notice. Seek legal advice before accepting a waiver of the resignation period without compensation.
Managing New Employment
1. Wait Until the Offer Is Signed and Final
Before giving notice to your current employer, make sure your new offer is finalized in writing and signed by both parties. Verbal assurances or email confirmations aren’t enough—offers can be withdrawn or delayed at any time. If you’ve already resigned, and your new job offer falls through, you could be left without income and without legal recourse.
Protecting Confidential Information When Changing Jobs
When changing jobs, protect your former employer’s confidential information. Ontario law prohibits using or sharing proprietary information after leaving a job, even without a formal confidentiality agreement.
What Counts as Confidential Information
- Trade secrets
- Customer lists and contacts
- Pricing and marketing strategies
- Business plans or financial data
- Proprietary software or processes
Your Legal Duty
Employees owe a common law duty of loyalty and confidentiality to former employers. Breaching that duty can lead to lawsuits and reputational damage.
Best Practices
- Don’t take or copy confidential files.
- Use only public or personal knowledge in your new role.
- When in doubt, seek legal advice.
- Avoid discussing confidential matters with competitors or colleagues.
Disclosing Non-Solicitation and Non-Compete Agreements in New Employment
When starting a new job, be transparent about any non-solicitation or non-compete agreements from previous employment. If asked, disclose them honestly.
As per the Supreme Court of Canada’s decision, you have a duty of honest performance—you must not mislead your new employer about restrictions that could negatively impact your new job.
In Ontario, most non-compete clauses are prohibited under the ESA and are enforceable only for executives or in the sale of a business.
Non-solicitation clauses, however, remain valid if reasonable in scope, geography, and duration.
Sharing these restrictions does not breach confidentiality, since you’re disclosing your own obligations, not your former employer’s secrets. Remember, transparency protects you from future disputes.
Ensuring Post-Employment Restrictions Do Not Affect Your New Role
Before accepting a new job, review any post-employment restrictions—including non-solicit or non-compete clauses—to ensure they don’t conflict with your new job.
Ignoring these obligations may lead to legal action from a former employer or disciplinary issues with a new one. Get legal advice early to confirm whether your restrictions are valid and how to comply.
Conclusion
Resigning in Ontario takes strategy and foresight and requires careful planning. Know your compensation rights, safeguard confidential information, and be transparent about any employment restrictions. Before making your next move, get the right legal guidance. Workplace Sage Legal can help you navigate your exit with a smart, proactive approach—minimizing risk, avoiding costly mistakes, and ensuring a smooth and successful career transition.
Protect your rights. Get paid what you’ve earned. Book a consultation today.
DISCLAIMER: This article/blog is provided for educational/informational purposes only. The views expressed are solely those of the author(s) and should not be attributed to any other party not listed as the author(s).
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
Nothing in this article should be interpreted as forming a solicitor-client relationship or construed as a solicitation for legal services.
