By: Stephanie McDonald and Baljinder (Bal) Singh Tiwana
Employment can end for many reasons, and understanding your rights is critical. In Ontario, and for federally regulated workers across Canada, the law distinguishes termination with cause from termination without cause, each carrying different obligations and protections. Employers can generally end employment for any lawful reason(s), but employees may be entitled to notice, compensation, or even reinstatement, depending on the circumstances.
This guide explains the key rules, clarifies your rights, and offers practical insights to help you resolve your matter fairly.
Types of Termination
Ontario employers terminate employees in two ways:
- Without Cause
- With Cause
Termination Without Cause
When provincially-regulated employers terminate without cause, they do not need a substantive reason—provided the reason is lawful and non-discriminatory. However, they must provide enough notice or pay instead of notice and severance pay.
Examples of lawful (though trivial) reasons include:
- Wearing a striped beanie every day to work (not for religious reasons)
- Showing up in mismatched socks
- Telling painfully bad jokes
- Brewing weak tea
What You’re Entitled to if You’re Terminated Without Cause
The Employment Standards Act, 2000 (ESA) requires your employer to provide notice or pay in lieu of notice, once you complete at least three months of continuous service.
When an employer doesn’t provide enough notice or pay when you’re terminated without cause, it’s called a “wrongful dismissal.” The ESA sets minimum notice and severance requirements, but most employees are entitled to additional notice or compensation under common law, called common law reasonable notice, based on factors such as age, position, length of service, and job responsibilities.
Termination With Cause
If an employer can establish “just cause” they do not owe you common law reasonable notice. An employer can only establish a termination with cause where they can establish that the employee engaged in serious misconduct.
Examples of serious misconduct include:
- Dishonesty or fraud
- Theft
- Harassment or workplace violence
If employers establish cause, they do not owe you reasonable notice. However, they may still owe you termination pay and severance pay under the ESA. The only situation where you are not owed your termination pay and severance pay under the ESA is if you have also engaged in conduct that amounts to wilful misconduct, wilful neglect of duty, or disobedience that is not trivial and hasn’t been condoned by your employer (described below).
Courts in Ontario set a high threshold for establishing just cause. Employers must provide clear, and compelling evidence that your conduct concluded the employment relationship. They also have to establish that they engaged in progressive discipline (a graduated system of addressing misconduct or performance concerns). Minor mistakes or performance concerns will rarely meet this standard.
Wilful Misconduct
Even if your employer says they have “just cause” to fire you, that does not automatically mean you lose your termination pay or severance pay. Under the ESA, you only lose those minimum payments if your employer can also prove you did something much more serious, called wilful misconduct, wilful neglect of duty, or disobedience. In plain language, this means you were bad on purpose. It does not include accidents, mistakes, misunderstandings, or unintentional slip-ups. This is a much higher legal standard than regular just cause. So even if your employer had a good reason to end your employment, you may still have rights to termination pay and severance pay unless they can show you deliberately did something seriously wrong.
Special Rights for Federally Regulated Non-Managers
Federally regulated employees, such as workers in banking, airlines, rail, and telecommunications industries—are governed under the Canada Labour Code (CLC), rather than the ESA.
Most federally-regulated employees are also entitled to reasonable notice of the termination of their employment.
Additionally, once non-managerial employees complete 12 months of continuous service, the CLC provides greater protection(s) against unjust dismissal. Thus, federal employers cannot dismiss you unfairly/arbitrarily, and will have to justify the termination with a valid reason, such as:
- Serious misconduct or dishonesty
- Harassment or workplace violence
- Theft or fraud
- Gross negligence causing harm
- Genuine lack of work due to economic conditions or restructuring
Filing an Unjust Dismissal Complaint
If your federally-regulated employer fails to show a valid reason, you’re not a manager, and you have 12 months of continuous service, you can file an unjust dismissal complaint and potentially secure reinstatement, compensation, or both.
You must file the complaint within 90 days (limitation period) from the date of dismissal, with the Labour Program, which attempts to resolve the matter through mediation. If the matter is not resolved, your complaint may be referred for CIRB adjudication, where an independent tribunal will review the case.
Ensure Your Termination Offer Is Fair
Regardless of the type of termination, always review your termination package carefully— before signing anything. It is prudent to instruct an Ontario employment lawyer to review it, before agreeing to anything. The employment lawyer can confirm whether the offer meets or exceeds your entitlements under the ESA, common law, or the CLC.
Conclusion
Termination can feel overwhelming, but understanding your rights gives you control and confidence. Whether your employer ends your employment with or without cause, and whether you are provincially or federally regulated, ensure that you receive a fair, lawful, and adequate notice, pay, and any benefits owed. By understanding your protections, you can navigate the process confidently, safeguard your interests, and act quickly if your dismissal was unlawful.
Workplace Sage Legal can guide you through every step, providing tailored expert advice to protects your rights and secure a just outcome. Knowing your rights gives you power—and helps you move forward with confidence. 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.
