Following recent court decisions and legislative changes around non-compete agreements in Ontario, employers should be reviewing and updating their employment contracts. Especially ripe for review are termination, restrictive covenant and arbitration clauses. Ontario Courts have recently provided valuable guidance to ensure that such clauses are enforceable and fulfill their intended purpose. The following decisions serve as an important reminder to employers to draft clauses in an employment contract very carefully.
Does your Employment Contract have “For Cause” Termination Language that is Linked to Protecting Confidential Information or Avoiding Conflicts of Interest?
In Henderson v. Slavkin et al., 2022 ONSC 2964, a receptionist at an oral surgery clinic was terminated with six-months' working notice because the owners of the business were retiring. The case centered around ”for cause” termination language that was found within the employment contract but outside the formal termination clause. First the “Conflict of Interest” provision provided that the employee would be terminated for cause “without notice or compensation in lieu of notice” if they engaged in any of the enumerated conflicts of interest without reporting them to the employer. The Court held that the provision was overly broad, unspecific, and ambiguous. It was unclear in what circumstances an employee would be engaged in a conflict of interest that violated the provision.
Second, the “Confidentiality”...
US President Donald Trump made a series of inaccurate or exaggerated claims during his speech at the United Nations General Assembly on Tuesday, although he largely stuck to a prepared script. Fro...