Finding the right words

Wording of termination provisions in employment contracts can go a long way towards determining if they’re enforceable
By Nikolay Chsherbinin
|Canadian Employment Law Today|Last Updated: 05/15/2013

Words are the voice of contracts. That voice guides a court during interpretation of a termination provision in an employment contract. A lesson from a recent case, Stevens v. Sifton Properties Ltd., suggests if the termination clause contains no explicit reference to continuation of benefits during the period of statutory notice, it will be struck as unenforceable. Thereby, exposing employers to the golden smelter of the reasonable notice doctrine, when calculating the dismissed employee’s entitlements.

Deborah Stevens began employment as an associate golf professional at the Riverband Golf Community in May 2007. In December 2007, she assumed the position of head golf professional, which was governed by an employment letter. The letter set out the termination provision as follows: “The corporation may terminate your employment without cause at any time by providing you with notice or payment in lieu of notice, and/or severance pay, in accordance with the Employment Standards Act of Ontario.”

On Oct. 19, 2010, Stevens’ employment was terminated without cause, effective immediately. At the time of termination, the employer paid her a sum representing three weeks’ pay in lieu of notice and continued her group benefits for three weeks.