In Richard Turcotte v. Grenville Management Inc., 2025 ONSC 3087,  Justice Akazaki had a situation where a 14 year Service Tech was given a temporary layoff notice as a result of the CVOID pandemic.

Here is the relevant chronology ;

March 5, 2021: Temporary Layoff Notice up to 35 weeks

November 5, 2021 : As a result of a medical condition, the Plaintiff is no longer able to work

January 14, 2022: Employer advises Plaintiff that he is now on Infectious  Disease Emergency Leave (IDEL)

July 30, 2022 : IDEL Expires, Plaintiff not recalled

February 22, 2023 : Plaintiff issues lawsuit claiming termination as of March 5, 2021

March 9, 2023: Discoveries held where Employer learns that the Plaintiff cannot work due to illness.

March 22, 2023: Employee issues a Notice of Recall . Plaintiff does not return.

These are the issues the Judge decided:

1. Frustration: As the evidence did not reveal that the Plaintiff was totally disabled on March 5, 2021 when the layoff took place,  there was no frustration. The fact that the Plaintiff became disabled after the layoff is not relevant.
2. Constructive Dismissal at Common Law: The Judge recognized that a temporary layoff is a termination unless it is part of the employment agreement that  a temporary layoff would not constitute a termination. In this case the Plaintiff’s employment contract contained an unusual cause, as follows 

   It is agreed that the Company reserves the right to ask you … to accept a temporary layoff, during which time you may be eligible for Employment Insurance in accordance with the relevant statutes.

   However, when the layoff occurred, they did not ask him to accept a temporary layoff, rather they told him that he was being laid off. He did however sign a document which stated ” I have read this notice and agree that my period of temporary layoff may continue for up to 35 weeks of layoff in 52 weeks .

   The Judge went on about how this was not really consent as for a number of reasons, however the facts reveal that the Company did not recall him for almost 25 months, so it hard to see how this issue was even relevant.

3. Impact of IDEL Regulation on the Common Law : Simply put the IDEL regulation provided that putting someone on an IDEL layoff was not a constructive dismissal but Section 8(1) of the ESA also provides that no civil remedy of an employee is affected by the ESA. There was a series of cases back in the day that consistently held that the IDEL Reg did not overrule the common law and therefore a common law claim for contructive dismissal based on a temporary layoff is still valid. Th Judge in a lengthy and extremely erudite rendition of the law ( including a reference to BNA Act and a 1931 case involving fish)  agreed with the established line of cases that upheld the fact that the IDEL Reg has no effect on the common law .
4. Length of Notice : It seems that the Judge thought that the normal notice period would be 10 months but because of the pandemic and the resultant difficulty in getting a job in his field, the Judge awarded anther 6 months notice for total of 16 months. This bump of 50% on the notice period because of the pandemic is much larger than previous cases have awarded.
5. Mitigation: The Plaintiff did nothing to look for a job. However the Judge accepted the Plaintiff’s evidence that until he saw his lawyer about 12 months later, he actually believed that he would be recalled so why should he look for another job? After his illness in November, he was medically unable to work. The found that there would be no reduction in the notice period because of a failure to mitigate.

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In William Williamson v Brandt Tractor Inc,  2025 ONSC  2571 Justice Akazaki had a situation where the employer was trying to prove just cause on the  basis of the cumulative misconduct principle. In order win such an argument, the employer must not only prove a history of disciplinary conduct but the the final incident ( the culminating incident ) was itself worthy of some discipline .

In this case the Plaintiff was a salesperson of tractors. The Plaintiff was dealing with a Customer who later complained to the Mr Clark, the Sales Manager that the Plaintiff had acted in an unethical and unprofessional manner. The Sales Manager made extensive notes of that conversation and testified about at the trial.

The Plaintiff admitted at trial that he and the Customer had a disagreement but denied any of his conduct was unethical or unprofessional.

The Defendant chose not to call the Customer as a witness.

This is what the Judge said :

My Comment;

In the olden days when I went to law school ( 1977 Grad of Osgoode) taking Evidence was mandatory. My understanding is that is no longer the case. I find that in my career as an arbitrator, there is an insufficient understanding both of the rules and the reasoning behind the rules of evidence. Lawyers are not the only ones who suffer from this lack of understanding. I have seen both judges and adjudicators let in evidence that should never be admitted under the guise that they will “give it the appropriate weight “.

Admissibility of evidence is fundamentally different from weighing the evidence. If the evidence is inadmissible, then it cannot be considered for any purpose whatsoever. It does not even make it to the scale to see if it has some weight.

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In Paul v. Sensient Colors, 2025 ONSC 3127  Justice De Sa had a situation of a 10 year Sales Rep who, contrary to the Employer Policy, refused to provide proof of her COVID status. She did not claim any human rights exemption. The Policy clearly stated that refusal to follow the policy would result in dismissal for just cause, which is what the Employer did.

Having concluded that the Employer’s mandatory vaccination policy was reasonable, the Court went on to say this :

[68] When an employer terminates with cause for non-compliance with a vaccination policy, there must be a sufficient connection between the employee’s job responsibilities and the requirement to be vaccinated so as to justify imposing the ultimate penalty of ending the employment relationship.

[69] Clearly, in certain cases, a refusal to vaccinate may sufficiently undermine an employee’s ability to carry out their duties so as to justify dismissal with cause. However, this will not be true in every case.

[70] In this case, I am not satisfied that the termination of Ms. Paul was a necessary or proportionate response to her refusal to disclose her vaccination status.

The Judge then went on to consider the following factors in determining that discharge for just cause was a disproportionate  response to the Plaintiff’s refusal to comply with the Policy.

1. 90% of her work time since the pandemic started was from home.
2. During the pandemic her performance exceeded the job requirements.
3. None of her 10 top clients required her to be vaccinated to do an on site visit.
4. Prior to her termination and during the pandemic she continued to do on site visits with clients in Ontario with no problems.
5. None of  her clients outside Ontario asked her to do an on site visit.
6. She had no US based clients.
7. She complied with all other safety requirements like masking.
8. She was an overall satisfactory employee.
9. Even though her job required that she attend certain meetings in the USA, the Employer could have arranged  much of the training in other ways.

If discharge for just cause was too extreme, what should the Employer have done ?

[78] A more proportionate response here may have been to review and revise Ms. Paul’s customer portfolio to the extent required, temporarily suspend her from customer-facing sales or even possibly put her on a leave of absence

She was awarded 12 months notice.

The Judge also noted that she was the only employee who refused to comply with the Policy.

Comments :

It seems that the farther we get away from the COVID era, the more lenient the Courts are getting in response to these types of cases.

Even though this Employee did not rely any human rights exemption, the Judge seemed to require the Employer to accommodate the Employee by requiring them to change  her job requirements so as to meet her desire not to be vaccinated.

However, the Judge also left open the option that they could have simply suspended her for the duration of the pandemic. This is consistent with a number of other COVID cases. I am not aware of any case where a suspension or a leave of absence in a COVID refusal case was held to be improper.

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In Brown v General Electric Canada ( 2025 MBCA 37 ) the Court had a situation where, as a result of a merger , the employee was offered a comparable  job with the new company. The Plaintiff refused the offer. The Plaintiff was then terminated. The new company did not renew the offer which was previously rejected.

The Court found that this refusal constituted a failure to mitigate .

This is what they said :

(c)           The judge discounted the significance of the timing of the Wabtec offer occurring before the termination because he drew an inference on the evidence that Wabtec would have re‑extended its offer to the plaintiff after the termination if there was any suggestion the plaintiff changed his mind, as Wabtec wanted the plaintiff to continue in his employment and took no steps to fill the position (see Brown at paras 55-56).

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In Boyle v. Salesforce.com, 2025 ONSC 2580 Justice Brownstone was faced with the following Termination Clause:

6 (b) Cause

The Company has the right, at any time and without notice (or pay in lieu), to terminate your employment under this Agreement for Cause. In the event that you are terminated for Cause, the Company’s obligation shall be limited solely to the payment of any portion of the Base Salary, and vacation pay, if any, that shall have been accrued by you prior to the date of termination.

Cause is defined in schedule A of the agreement as “any act or omission by you that would in law permit the Company to, without notice or payment in lieu of notice, terminate your employment.”

The company is regulated by different local laws where it operates globally. If there is a conflict in these laws, you should consult the Company’s legal department to resolve the conflict appropriately. In general, local laws will apply.

Except for certain non-U.S. jurisdictions, the Company’s employment relationship with all of its employees is one of employment “at will,” which means that employment may be terminated by either the employee or the Company at anytime, with or without cause. If you are located outside of the U.S. and have an employment agreement, the terms of those agreements will prevail if there is any conflict with the policies in this handbook. However, all other policies will apply.

The policies in the Global Employee Handbook are not a contract and that my employment is “at will.” This means that the Company or I can end my employment at any time with or without cause or advance notice.

The Judge found that this provision was illegal :

25]        In my view, applying the governing principles to this contract clearly results in the unenforceability of the termination provisions. There is no practical way that an employee in Ontario could be aware, when signing the contract, of the terms that would govern his termination. The ambiguity contained in the documentation, all of which Mr. Boyle was required to sign prior to commencing employment, is explained by Salesforce’s choice to use one contract for employees in many jurisdictions. Salesforce repeatedly claims to be able to terminate employment at will. It then says that this provision will not apply in certain jurisdictions outside of the U.S. If the employee is uncertain, he should consult the Company’s legal department. It is impractical to expect a potential employee, who has not yet started employment, to consult the future employer’s lawyer before signing an employment agreement to understand what kind of misconduct, if any, is cause for termination.

26]        I therefore find the provision is not compliant with the ESA, or at least ambiguous as to whether it is complaint, and is therefore unenforceable. Mr. Boyle is entitled to payment in lieu of reasonable notice.

My Comments :

This case illustrates the importance of designing specific termination clauses for each jurisdiction in which an employee resides and works. One size does not fit all. Especially Ontario.

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In Brink v Xos Services (Canada), Inc., 2025 BCSC 658 (CanLII) Justice Hughes had a situation where the parties agreed on the settlement number

(  $441,667.00 USD ) but the defence offer was based on ” less statutory deductions” and the plaintiff accepted the offer on the condition that it be on the basis that it be treated as non employment income.

In Canadian terms this would be asking that the settlement funds be treated as ” general damages” which apparently attracts no taxation.

This is why the Judge ruled that there no settlement :

“However, the tax treatment of the settlement payment was a condition of fundamental importance to both parties. As an employee, the plaintiff was typically taxed at a rate of around 32% which, if applicable to the settlement funds, would result in a tax deduction of up to $143,300. The plaintiff sought the full settlement amount with no source deductions. The defendants offered to pay the settlement amount less applicable deductions, to avoid any negative tax implications for them. This is a significant gap that cannot be overlooked or resolved by resorting to common sense or common practice, as was discussed in Fieguth.”

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I previously reported on a case called De Castro v. Arista Homes Limited
in which the trial Judge found that the following clause breached the ESA ands therefore unenforceable:

“If you are terminated for Cause or you have been guilty of wilful misconduct, disobedience, breach of Employment Agreement or wilful neglect of duty that is not trivial and has not been condoned by ARISTA, then ARISTA will be under no further obligation to provide you with pay in lieu of reasonable notice or severance pay whether under statute or common law.

For the purposes of this Agreement “Cause” shall include your involvement in any act or omission which would in law permit ARISTA to, without notice or payment in lieu of notice, terminate your employment.”

The Employer had a somewhat convoluted interpretation of how this clause could be read to be consistant with the ESA.

The Court of Appeal said that the judge’s interpretation was correct.

What is interesting is what they said about the methodology of how Courts are to approach these cases.

[14]    Finally, the motion judge’s approach reflects a careful application of established principles governing the interpretation of employment contracts. Courts have recognized that such contracts are generally interpreted differently than other commercial agreements to protect the interests of employees: see Wood v. Fred Deeley Imports Ltd., 2017 ONCA 158, 412 D.L.R. (4th) 261, at paras. 26-28. Employees have less bargaining power than employers. Furthermore, employees are far less likely than employers to be familiar with the standards dictated by the ESA.

[15]    Because the ESA is “remedial legislation, intended to protect the interests of employees”, courts are to adopt an interpretation that best achieves this objective: Wood, at para. 28. That means an interpretation that “encourages employers to comply with the minimum requirements of the Act” and “extends its protections to as many employees as possible”: Machtinger v. HOJ Industries Ltd., 1992 CanLII 102 (SCC), [1992] 1 S.C.R. 986, at p. 1003. The contract is to be read as a whole, with any ambiguity construed in favour of the employee.

The Court of Appeal decision can be found at l(2025 ONCA 260).

In other words, if there are two possible ( presumably reasonable ) interpretations of a termination clause, we are to always favour the one that  favours the employee.

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In Miller v. Alaya Care Inc., 2025 ONSC 1028 (CanLII) Justice Carroccia had a situation of a 62 year old VP making over $250K with only 7 months service who was terminated without cause. Having set aside an illegal termination clause, the Judge focussed on the issue of whether the Plaintiff had been induced to leave her previous job of 12 years and if so, what effect that would have on the notice period.

First the Judge listed these factors to consider :

1. the reasonable expectations of both parties;

2. whether the employee sought out work with the prospective employer;

3. whether there were assurances of long-term employment;

4. whether the employee did due diligence before accepting the position by conducting their own inquiry into the company;

5. whether the discussions between the employer and prospective employee amounted to more than the persuasion or the normal “courtship” that occurs between an employer and a prospective employee;

6. the length of time the employee remained in the new position, the element of inducement tending to lessen with the longevity of the employment; and

7. the age of the employee at termination and the length of employment with the previous employer.

Applying these factors to this case, the Judge said as follows:

[88]        In my view, these discussions initiated by the defendant go beyond the normal “courtship” between an employer and prospective employee and amount to an inducement. The following circumstances support this finding:

1.     The defendant reached out to the plaintiff first.

2.     There were representations made by AlayaCare that the plaintiff’s experience would assist in “growing” the company.

3.     Inquiries were made by AlayaCare as to the extent of the plaintiff’s renumeration with WellSky ( her previous employer of 12 years, editors note) , including bonuses and RSUs so that they could “lure” her.

4.     AlayaCare had hired a number of people in 2021 as part of an “aggressive growth strategy”.

5.     The defendant was prepared to go as far as indemnifying the plaintiff in the event that her previous employer commenced litigation against her for leaving them to join AlayaCare.

[89]        As a result, I find that there were inducements offered to the plaintiff to lure her to leave her employment with WellSky to become an employee of AlayaCare. This factor favours a longer period of notice.

My comments :

Inducement is often pleaded but it rarely works. This case sets out the type of evidence that is needed to prove inducement .

Under most circumstances a 13 year Senior Executive who was 62 years of age would receive a notice period greater than 14 months. On the other hand, without inducement, a 7 month employee would never get 14 months notice.

Inducement seems to give you a notice period greater than your actual employment with the defendant but less than the combined service of the two employers. This recognizes that the Plaintiff is always taking a risk with a new employer but that no reasonable person would leave a secure job of long service without the expectation that the new job would last some significant period of time.

I do not usually list who the winning lawyer is, but in this case I make an exception because Plaintiff’s counsel was none other than this years winner of the Ontario Bar Association Randall Echlin Award for Excellence in Labour and Employment Law, Stephen Moreau of Cavalluzzo LLP.

Bragging Note : I was the recipient of this award last year.

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In Ramotar v Trader Corporation ( No Canlii cite yet ) Deputy Judge K. Qureshi of the Toronto Small Claims Court reviewed a termination provision which had the following language :

“If your employment is terminated without cause, the Company will continue your group insurance benefit coverage for such period as the Employment Standards Act, 2000 shall require, provided such coverage is available from the insurer.”

The Deputy Judge found that as the employee would still be entitled to payment in lieu of such benefits if the insurance company did not cover the claim, the whole clause was illegal as it was not in compliance with the ESA.

My Commentary;

Presumably the Deputy Judge was referring to Section 60 (1) (c) and (3) of the ESA which reads as follows:

60.(1) Requirements during notice period. During a notice period. required under Section 57 or 58, the employer,

(c) shall continue to make whatever benefit plan contributions would be required to be made in order to maintain the employee’s benefits under the plan until the end of the notice period .

(3) Benefit Plan Contributions : If an employer fails to contribute to a benefit plan contrary to clause (1) (c), an amount equal to the amount he employer should have contributed shall be deemed to be unpaid wages for the purpose of Section 103.

Note that the employer is not required to provide the coverage, only to pay the premium cost to the insurance company.

But if the employer fails to make the necessary premium payment and as a result the employee incurs an expense or a loss that would have been covered , then the employee can pursue a civil action against the employer. I once had a case where the employer failed to continue my clients’ $100,000 life insurance policy after his termination. My client died during the ESA notice period and after the insurance company denied coverage, we successfully sued the employer and got them to pay the $100,000.

This obligation to maintain benefits continues under the common law throughout the reasonable notice period. This can lead to huge negative consequences when an employee becomes disabled during the common law notice period. The employer cannot, under the terms of most group disability plans , continue to provide for LTD coverage after the statutory notice period. Therefore if the employee were to become totally disabled during the common law notice period, the employer steps into the shoes of the LTD insurer and is on the hook for what could be a sum well in excess of responsible notice.

See Prince v. T. Eaton Co. Limited, 1992 CanLII 5968 (BC CA)

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