2025 was another eventful year in employment law. As with previous years, the enforceability of termination clauses continued to dominate courts’ time, but a more balanced approach to these clauses emerged this past year. We also saw our courts address the duty to mitigate, pre-employment inducement and, right before the holidays, claw back clauses, giving those practising in this area clear guidance on these issues. The following are the top employment law decisions of 2025.
1. Termination clauses
Uncertainty around termination clauses in employment contracts continued in 2025. The top termination clause decisions of 2025 could be divided into three buckets. In the first bucket are decisions that continued to support the trend that the phrases “at any time” and “at [the employer’s] sole discretion,” when found in a termination clause, render the clause unenforceable.
In Chan v. NYX Capital Corp., 2025 ONSC 4561, the Superior Court of Justice found that the “without cause” termination clause in the employment contract was not enforceable because it provided for termination “at any time and for any reason.” The court relied on its decision in Dufault v. The Corporation of the Township of Ignace, 2024 ONSC 1029 to conclude that this phrase attempted to contract out of the Employment Standards Act, 2000 (ESA), rendering it invalid.
In Baker v. Van Dolder’s Home Team Inc., 2025 ONSC 952, the Superior Court found that the “without cause” termination clause was unenforceable...
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