Back in February, I dicsussed the (then) recent cases of Dufault and Baker. In the months since, there have been several cases that have addressed similar language, with widely divergent results. I felt it my duty to update all of you on where we seem to be landing, and sadly, we’re not much further ahead.
Three cases have revisited the question of termination provisions that contain language allowing an employer to terminate “at any time”, each drawing very different conclusions:
In Jones, the court determined that “at any time” would not invalidate a termination provision absent the employer reserving the right to do so at its “sole discretion”.
In Li, the court determined that “at any time and for any reason” was enforceable even though “for any reason” is arguably similar to “sole discretion” (given that an employer could choose to terminate for reasons that are illegal – for instance as a reprisal for exercising a protected right).
In Chan, the court went in the opposite direction, affirming that “at any time” (on its own) and “at any time without cause” was unenforceable because it allowed an employer to terminate at times and in circumstances that would otherwise be illegal (see above).
What this does affirm, is that the use of any superfluous language in a termination provision is subject to creative arguments by employee-side counsel, increased scrutiny by judges, and completely uncertain outcomes for employer-side counsel.
While we’ve seen the courts grapple with similar language, the outcomes remain inconsistent and unpredictable. Until clearer guidance emerges, caution is key. One thing is certain, if ever there has been a time to review termination provisions in your contracts with current employees to determine if they’re likely to be enforceable, I would suggest that “at any time” is as good as any, but without question, now is most definitely that time.
Remember - taking an unenforceable termination provision and finding options to resolve the issue is always much easier to do before you rely on the language (i.e. while the employee continues to be employed and before you make the decision to terminate).
The good news for those of you prepared to undertake this exercise is that we have recent guidance from the Ontario Court of Appeal on what an enforceable termination provision looks like in Bertsch v. Datastealth Inc., 2025 ONCA 379 (issued May 16, 2025), which we’d be happy to discuss – remember, your trustee PH team is just a phone call/quick email away!
And for those of you interested in more details on the facts, termination language, and decision of each of the Jones, Li, and Chan cases, we've provided more substantive summaries of those cases below.
Jones v. Strides Toronto, 2025 ONSC 2482 – Released April 23, 2025
Jones commenced employment with Strides on January 10, 2022, in the position of Senior Manager of the Provincial Walk-In Program. Jones was terminated from her employment on a without cause basis on May 15, 2023, after just 16 months of service. At the time of her termination, she was 43 years old.
The clause allowed the employer to terminate as follows:
The Organization may terminate your employment without cause at any time upon providing you with the following:
Advance notice, or payment in lieu, in accordance with the Employment Standards Act, 2000 (“ESA”) and any other payments required by such legislation including severance pay, and as well as continuing to provide benefits (which includes participation in the group RRSP) during the applicable statutory notice period; plus
An additional 1-week advance notice of termination or pay in lieu thereof for each completed year of each completed month of employment with the Organization in an incomplete year.
Notwithstanding the above, the Organization may terminate your employment at any time, without notice or pay in lieu thereof or severance pay, for willful misconduct, disobedience or willful neglect of duty that is not trivial and has not be[en] condoned by the Organization. If your employment is terminated for conduct that amounts to just cause at common law but not willful misconduct, disobedience or willful neglect of duty that is not trivial and has not been condoned by the Organization, you will receive those amounts set out in (a) above but you will not receive the amounts in (b) above.
[...]
If your entitlements under any part of this letter are less than your minimum entitlements under the ESA, you will receive your entitlements as required under the ESA, instead of under this letter. In that case, the specific ESA entitlement will be incorporated in this letter without impact the validity or applicability of the remaining parts of this letter.
Justice Moore ruled that the phrase “at any time” does not invalidate a termination clause unless paired with problematic language like “sole discretion.” However, the clause was ultimately unenforceable because the “for cause” provision allowed for termination where the ESA standard of “willful misconduct, disobedience or willful neglect of duty that is not trivial” has not been met by providing only “those amounts set out in (a) above”. The judge determined that this was sufficiently ambiguous as to benefits continuation during the statutory notice period. In the circumstances, Justice Moore awarded a notice period of four months.
Li v. Wayfair Canada Inc., 2025 ONSC 2959 – Released July 9, 2025
Li, a Senior Product Manager at Wayfair Canada, was employed from January 23, 2023 – October 17, 2023 (just under 9 months). On termination, the issue arose whether the termination clause in Li’s employment contract was enforceable under the Employment Standards Act, 2000 (ESA).
The termination clause stated that Wayfair could terminate Li’s employment:
After your probationary period concludes, in the absence of Cause, the Company may terminate your employment at any time and for any reasons 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.
This clause was central to the dispute. Li argued it was unenforceable because the phrase “at any time and for any reason” could violate the ESA, particularly in cases involving protected leaves or reprisals.
However, the Court found that the clause did not breach the ESA and was therefore enforceable. Justice Dow distinguished from the language in Dufault finding that the use of “at any time” does not automatically render a termination provision unenforceable. He emphasized that the clause clearly limited entitlements to ESA minimums and did not attempt to contract out of statutory protections. As a result, Li was entitled only to the minimum statutory entitlements under the ESA, which he received: one week’s pay and benefits continuation and his claim for five months of common law notice was dismissed.
Chan v. NYX Capital Corp., 2025 ONSC 4561 – August 26, 2025
Chan was employed by NYX Capital Corp. for less than 3 months. At issue on termination was the enforceability of the termination clause and whether Chan was properly terminated as a probationary employee.
The impugned termination clause stated the following:
Termination Your employment with the Company may be terminated as follows:
(a) The first three months of your employment are probationary, during which time the Company may terminate your employment at any time and for any reason at its discretion, without notice or pay in lieu of notice, or other obligation.
[...]
(c) After you successfully complete the first three months of your employment, the Company may terminate your employment at any time without cause, upon providing you with notice, or pay in lieu of notice, benefits continuation and severance pay (if applicable) and any other benefits or entitlements strictly required in accordance with the minimum requirements set out in the ESA. It is agreed and understood that the provision of such notice or pay in lieu of notice, severance pay (if applicable), benefits continuation and any other benefits or entitlements required under the ESA shall constitute full and final satisfaction of any claim which you might have arising from or relating to the termination of your employment, whether such claim arises under statute, contract, common law or otherwise, save any claim that cannot be released by operation of a statute of Ontario.
(d) The Company may terminate your employment at any time for cause, without any obligation to you on account of notice or pay in lieu of notice, severance pay, or other obligation, other than accrued amounts owed to the date of termination.
Justice Parghi ruled the termination clause unenforceable because:
The Court emphasized that even probationary employees are entitled to ESA protections and cannot be terminated in bad faith. Accordingly, the phrase “at any time and for any reason” in paragraph 10(a) violated the ESA. He relies on Dufault and Baker to draw this conclusion, arguing that an employer does not have an unfettered right (for instance, they cannot terminate as reprisal for the employee exercising certain rights). As a result, NYX’s assertion that Chan was a probationary employee failed because the probationary clause itself was invalid.
The phrase “at any time without cause” in paragraph 10 (c) would similarly be offside (despite the absence of “for any reason”). Further, he takes issue with the fact that the clause purports to release NYX of all claims Chan may have, even those claims which cannot be properly released. By way of example, he offers the following: “if Mr. Chan were dismissed in reprisal for attempting to exercise a right under the ESA, he could claim damages, and paragraph 10(c) improperly purports to have him contract out of that right.”
The “for cause” provision conflicted with the ESA, in line with Waksdale, by not properly limiting the ambit of “cause” to only the standard required by the ESA (i.e. “wilful misconduct, disobedience or wilful neglect of duty that is not trivial and has not been condoned by the employer.”)
Having found the termination clause unenforceable, the Court awarded the plaintiff with three months’ reasonable notice. Interestingly, the Court noted that, had it found the termination clause to be enforceable, it would have sided with NYX and Chan would have not had any entitlements to notice during the probationary period, as NYX provided Chan with a fair and reasonable opportunity and had made a good faith determination that he was not suitable for the role for which he had been hired.