Area of Law: Business Law
Answer # 0306
Termination of employment letterRegion: Ontario Answer # 0306
When can an employee be fired?
Contrary to what many people think, an employer can end a non-union employee’s job at any time, and for any reason. However, the employer is required by law to give the employee a minimum amount of notice, or pay instead of notice, unless the employee was fired for willful misconduct or neglect of duty, which resulted in “just cause”.
What is the purpose of a termination of employment letter?
A termination of employment letter is a formal acknowledgment to the employee that the employment has been terminated. It also serves to tell the employee if the termination is based on just cause, when the termination becomes effective, and the length of notice or pay in lieu of notice the employer is giving (if applicable). This provides clarity to the situation and may forestall confusion and litigation.
Notice or pay instead of notice
Most employees have the right to notice if they are fired without just cause. If the employer wants the employee to leave right away, then the employer must pay the employee instead of giving notice.
Most employees are covered by their provincial Employment Standards Act, which sets out minimum notice requirements. However, different minimum requirements apply to employees who work for companies regulated by federal law, such as airlines or banks.
Employees on probation
Most provincial employment and labour standards legislation does not require any specific minimum notice for an employee dismissed in his or her first few months of employment, usually either three or six months.
Notice requirements set by the Act, the court and by employment agreements
The Employment Standards Act (ESA) guarantees that most employees in Ontario who work for three months or longer for the same company are entitled to notice or pay instead of notice (called termination pay). The ESA also sets out the minimum notice requirements.
How much notice is required is also determined by the amounts set by the courts, and whether the employee worked for a provincially or federally regulated company. Although the ESA sets out minimum notice requirements, court cases have established that in many cases employees are entitled to longer notice periods. When determining the appropriate length of notice, the courts will consider many factors, including the length of employment and the age of the employee.
What is wrongful dismissal?
If an employee is fired and not given proper notice or pay in lieu of notice, then, unless the employer had just cause, the employee is considered to have been wrongfully dismissed. Sometimes an employee does something wrong, but it is not a good legal reason to be fired without notice or pay.
Claims for wrongful dismissal can involve substantial amounts of money. If you think you were wrongfully dismissed you should consult a lawyer. If you are an employer wishing to terminate an employee’s employment, it is advisable to consult a lawyer before you do so.
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