A knowingly false allegation of “cause” can void an otherwise valid termination provision.
In Dixon v British Columbia Transit, [1995] BCJ No 1892 (BC SC), the British Columbia Supreme Court held that an employer could not rely on its contractual termination provision to limit its severance obligation because the contract did not provide for a measure of liquidated damages in the event of wrongful dismissal; the contract only provided for compensation in lieu of notice if dismissal was pursuant to the employer's lawful right to dismiss in the absence of cause.