How does a court get around the pesky “any time,” “any reason” issue and find that a contractual termination provision containing such words is legally determinative of an employee’s entitlement? Simple. By failing to engage on the point.
In Li v. Wayfair Canada ULC., 2025 ONSC 2959, the Honourable Justice Grant Dow of the Ontario Superior Court sitting at Toronto bucked the current trend and found the following termination clause to be legally acceptable, “After your probationary period concludes, in the absence of Cause, the Company may terminate your employment at any time and for any reason by providing you with only the minimum statutory amount of written notice required by the ESA or by paying you the minimal amount of statutory termination pay in lieu of notice required by the ESA, or a combination of both, as well as paying statutory severance pay required by the ESA, providing benefits continuance for the requisite minimum statutory period under the ESA and all other outstanding entitlements, if any, owing under the ESA.”
Facts
For the purposes of this post, one really doesn’t need to know much more about the facts. The case came before the court on a motion for summary judgment. The plaintiff alleged that the termination provision was legally unenforceable and sought damages in lieu of reasonable notice. The defendant argued that the clause was legally enforceable.
Argument
According to the decision, plaintiff’s counsel relied on the decision in Dufault v. The Corporation of the Township of Ignace, 2024 ONSC 1029, which held the right of the employer to dismiss is not absolute. The plaintiff relied on examples such as: section 53 of the ESA which prohibits termination on conclusion of a leave, such as parental; section 74 of the ESA for attempting to exercise a right under the ESA; or section 50 of the Occupational Health and Safety Act, R.S.O. 1990, c. O. 1 for acting in compliance in provisions of that statute.
Reasons for Decision
Justice Dow found the termination provision in this case nonetheless legally enforceable. His reasons for decision are rather short and start at paragraph 14:
[14] [Dufault] found both the “for cause” and “without cause” clauses unenforceable on the basis they do not comply with the minimum standards set out in the ESA was reviewed by the Court of Appeal (2024 ONCA 915) and upheld. The Court maintained that “the termination provisions in an employment contract must be read as a whole. If one termination provision in an employment contract violates the ESA minimal standards, all termination provisions in the contract are invalid” (at paragraph 23).
[15] The reason behind this conclusion was no doubt based on statements by appellate courts that employment contracts are interpreted differently than other commercial contracts in order to protect the interest of employees who are seen to have less bargaining power (Wood v. Fred Deeley Imports Ltd., 2017 ONCA 158 at paragraphs 26 to 28). Further, on termination, the employee is most vulnerable and in need of protection. As a result, the Courts should favour interpretation of employment contracts that give the greater benefit to the employee.
[16] That said, my reading of the employment agreement, as a whole, leads to the conclusion the agreement sought only limit the employer’s obligation of that provided by the provisions of the ESA.
[Analysis of the “for Cause” provision omitted]
[18] The without cause termination provision clearly and repeatedly indicates payments will be made as “required by” or “under the ESA”.
[19] Plaintiff’s counsel submitted the termination clauses in this contract were similar to that reviewed in Dufault. I disagree. While the termination clause in Dufault contained the phrase “anytime”, its definition of cause did not refer to the ESA or the definitions cited above. With regard to “without cause” dismissal, the wording failed to provide for all types of wages such as vacation pay or sick days.
[20] My review of the appellate authorities provide for employment contracts, when read as a whole, so long as they comply with the terms and provisions of employment legislation are permitted and can be enforceable. I prefer the reasoning and conclusion found in Amberber v. IBM Canada Ltd., 2018 ONCA 571 (at paragraphs 59 to 62). To that end, plaintiff’s counsel raised the need to follow decisions of judges of coordinate jurisdiction citing Baker v. Van Dolder’s Home Team Inc., 2025 ONSC 952. While I agree with the principle contained in that decision, I find the wording in this employment contract to be distinguishable to that contained in that case and thus requires a different conclusion.
[21] As a result, I find the terms of the Employment Agreement in the circumstances to be enforceable and the plaintiff’s claim for common law damages beyond the ESA mandated payment of one week of basic salary and benefits (which was paid) should and is dismissed.
Commentary
There is a lot to unpack here, but let’s start with he reasoning and conclusion found in Amberber v. IBM Canada Ltd., 2018 ONCA 571 (at paragraphs 59 to 62).
In Amberber released well before the Court of Appeal’s decision in Waksdale v Swegon, and this entire of line of cases beginning with Dufault, the Court of Appeal wrote the following:
[59] The fundamental error made by the motion judge is that she subdivided the termination clause into what she regarded as its constituent parts and interpreted them individually. In my view, the individual sentences of the clause cannot be interpreted on their own. Rather, the clause must be interpreted as a whole.
[60] When read as a whole, there can be no doubt as to the clause’s meaning.
[61] The parties have set out a formula for calculating the amounts owing to a terminated employee. The amounts owing include any entitlement under employment standards legislation and the common law. To the extent that employment standards legislation provides for something superior, the employee will receive the statutory entitlement.
[62] To the extent that the motion judge relied on the placement of the inclusive payment provision within the clause, she erred. By holding that because it was placed between the options provision and the failsafe provision it only applies to the options provision, she failed to read the clause as a whole. The failsafe provision itself modifies the options provision, and ensures that it is read up so that it complies with the ESA. To hold that the inclusive payment provision applies to only one part of the clause, but not the other, gives the clause as a whole a strained and unreasonable interpretation. In fact, if the inclusive payment provision were repeated at the end of the clause, as suggested by the motion judge, it would likely do little more than create confusion.
With the greatest respect to both the court and counsel who may have submitted such holding to it, I fail to see what those paragraphs have to do with whether a termination provision that purportedly allows an employer to terminate an employee without cause at “any time” and/or for “any reason.”
The holding from Amberber that I believe the court would have been better to cite is actually in the next paragraph, paragraph 63, where the Court of Appeal for Ontario channelled its inner TLC and reminded trial courts that they “should not strain to create an ambiguity where none exists.” Effectively, don’t go chasing waterfalls – please stick the rivers and the lakes that you’re used to. (TLC, Waterfalls, on CrazySexyCool (LaFace Records, 1994); Chilton v. Co-Operators General Insurance Co. (1997), 1997 CanLII 765 (ON CA), 32 O.R. 161 (C.A.), at p. 169)
While there is appeal to such direction, and while I have, at times, been critical of the lengths to which it sometimes feels courts have been willing to go to find ambiguity or otherwise find reasons to invalidate contractual termination provisions, with the greatest of respect, the court’s decision in Li does not invoke the direction to avoid straining to create ambiguity, nor does it even engage on the key argument.
Li does not contradict Dufault; it ostensibly distinguishes it - by effectively pretending that the phrases "any time" and "any reason" are not, in and of themselves, attempts to contract out of the ESA, thereby rendering the termination provision void.
Paragraph 19 is the most-telling on this point, "Plaintiff’s counsel submitted the termination clauses in this contract were similar to that reviewed in Dufault. I disagree. While the termination clause in Dufault contained the phrase “anytime”, its definition of cause did not refer to the ESA or the definitions cited above."
The court completely avoids the entire point of why Dufault is now cited for the proposition that if a contract purports to allow an employer to termination “at any time” and/or for “any reason,” then it is voidable.
In my own opinion, the court's lack of analysis on the "any time," "any reason" language - notwithstanding it being squarely put before the court - undermines the precedential value of the decision. I openly query what the Court of Appeal would do with such decision on appeal.
Speaking of the Court of Appeal, it is my Christmas wish that when that court is asked to engage on this issue, whether squarely before it or not, it takes the opportunity it squandered in Dufault and directly engages on the issues of whether (1) an employer can terminate an employee without cause (a) at any time; or (b) for any reason; and (2) an employer can terminate an employee with cause at any time.
Sean Bawden: Experience. At Work.
I am an experienced employment lawyer and wrongful dismissal lawyer practicing across Ontario and beyond with Kelly Santini LLP, which is based in Ottawa.
For two and a half years I was in-house legal counsel providing employment law advice to one of Canada’s largest corporations and appeared in labour courts and tribunals literally the world over.
I have also been a part-time professor at Algonquin College and have taught Employment Law, Trial Advocacy for Paralegals, and Small Claims Court Practice. I am a past president (2024-2025) of the County of Carleton Law Association (“CCLA”), and have sat as a safe sport adjudicator.
I can be reached by email at sbawden@kellysantini.com or by phone at 613.238.6321 x233.
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As always, everyone’s situation is different. The above is not intended to be legal advice for any particular situation. It is always prudent to seek professional legal advice before making any decisions with respect to your own case.
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