On May 16, 2025, the Ontario Court of Appeal in Bertsch v Datastealth Inc., 2025 ONCA 379 (CanLII) upheld a termination clause limiting employees’ termination entitlements to the minimum amounts pursuant to the Employment Standards Act, 2000 (the “ESA”). This recent case brings positive news for employers within the current legal landscape surrounding termination clauses.
The Ontario Court of Appeal confirmed that the termination clause in question, when reasonably interpreted, clearly and unambiguously excluded the employee’s entitlements to common law reasonable notice, limiting the employee’s termination entitlements to those required by the ESA.
This case provides helpful guidance to employers in drafting termination clauses that can effectively limit an employee’s entitlements upon termination while withstanding legal scrutiny.
As we wrote previously in our website article on the Ontario Superior Court decision, the termination clause in question stated:
5. Termination of Employment by the Company: If your employment is terminated with or without cause, you will be provided with only the minimum payments and entitlements, if any, owed to you under the [ESA] and its Regulations,…including but not limited to outstanding wages, vacation pay, and any minimum entitlement to notice of termination (or termination pay), severance pay (if applicable) and benefit continuation. You understand and agree that, in...
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