Termination Clause in Handbook not Binding:

In Asgari v 975866 Ontario Limited, ( 2015 ONSC 7508 ) Dow J. held that a an otherwise valid ESA termination clause was not binding on the Plaintiff because the same Employee Handbook which contained the termination clause had a provision on the page  which the plaintiff signed which said ” the Employee Handbook is not a contract of employment, that my employment with the company  is not for a specified term”.

The Judge said as follows:

[7] As a result, it is confusing if not contradictory about whether the plaintiff waived his right to seek common law damages beyond that available pursuant to the Employment Standards Act, S.O. 2000 c.41, which was paid to him, that is, one week or $1,711.54. I conclude those cases referred to me by counsel for the defendant requiring my enforcement of only Employment Standards Act notice provisions are distinguishable given the Employee Handbook as it states (at page 29) that it is not (part of) a contract of employment. I am reinforced in this conclusion by the lack of evidence that the plaintiff accepted this policy in respect of his employment.

These types of ” this is not a contract ” clause originate in the US where they are routinely inserted to offset the American implied term of “employment at will”. They make no sense in the Canadian context.

The much better practice is to insert the termination clause right in the hiring letter or the employment agreement, and not attempt to  have it incorporated by reference from a different document or website.


95 thoughts on “Termination Clause in Handbook not Binding:”

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