Why Employers Are Finding It Increasingly Difficult to Comply with Ontario’s Employment Laws

Nov 8, 2016

Lawyers as Forest Rangers

You can compare employment lawyers to forest rangers.

We prevent legal fires when we, for example, draft employment contracts & legally required policies, and when we provide prophylactic advice such as pre-termination advice.

We put out legal fires when we, for example, defend wrongful dismissal actions, human rights complaints, and claims for overtime pay under the Employment Standards Act.

Lawyers as Compliance Officers

In recent years with the proliferation of new workplace laws, employment lawyers have also taken on the role of compliance officers for some clients.

Unless a person is responsible for keeping an organization up to date on Ontario’s employment laws, an employer is simply not aware of new employment laws.

In the past, many employment laws were of the “Thou shall not…” variety.

Increasingly, however, the laws are of the “Thou shall do (something)…” variety which makes compliance impossible if the employer is unaware of a new law. As most people are aware, ignorance of the law is not a defence to a violation of a law.

New Employer Obligations

As readers of this blog are aware, the Ontario government regularly introduces new laws and amends existing employment laws. Here are a small number of recent new or changed laws:

  1. Mandatory Training

New employees must generally receive customer service training under the Accessibility for Ontarians with Disabilities Act (“AODA”), and mandatory health and safety training under the Occupational Health & Safety Act (“OHSA”).

  1. Mandatory Investigations

Employers are now required to investigate workplace harassment complaints (i.e. my co-worker is “bullying” me) and the person who investigates the complaint must be appropriately trained. If not, the Ministry of Labour can order the employer to retain an external investigator at the employer’s expense.

Although an investigation into a human rights complaint is not explicitly required under the Ontario Human Rights Code the failure to do so can result in an order to pay an employee damages for failure to investigate even if an adjudicator concludes no discrimination took place.

  1. Mandatory Requirements In Relation with Disabled Employees

As of January 1, 2016 eleven (11) new obligations were imposed on employers with 50 or more employees as a result of the Employment Regulation under AODA. These obligations were all of the “Though shall do (something)…” variety. One such obligation is to prepare an individual accommodation plan for any disabled employee who requests accommodation. This plan must address at least 8 prescribed issues. These new obligations are imposed on employers with 1 to 49 employees on January 1, 2017.

I will continue to bring new employment law developments to your attention through this blog. But sometimes this is not enough.

The MacLeod Law Firm’s Compliance Services

To help employers comply with new employment laws and to manage compliance risk, the MacLeod Law Firm is offering a number of fixed fee services.

One service is our HR/Employment Law Compliance service. After determining a client’s compliance needs, we prepare a schedule of monthly services. (i.e. Month 1 – Occupational Health & Safety Act compliance; Month 2 – Employment Standards Act compliance; Month 3 – Mandatory postings and training compliance etc.)

Another service is our AODA Compliance Report. We review each client’s current practices and provide a written report setting out exactly what the organization needs to do to comply with AODA’s new Employment Regulation.

For over 25 years, Doug MacLeod of the MacLeod Law Firm has been advising employers on all aspects of the employment relationship. If you have any questions, you can contact him at 416 317-9894 or at [email protected]

There are many ways to attack the termination clause in an employment contract. 

I am now surprised if employee counsel does not claim that their client’s  termination clause is not legally enforceable - usually because the termination clause does not allegedly comply with the Employment Standards Act.

This blog considers a case, McKercher v Stantec Architecture Ltd., 2019 SKQB 100, where an employee successfully attacked the termination clause in his contract because he did not explicitly agree to it after being promoted. 

The Facts

In 2006, Mr. McKercher commenced employment as a staff architect. The termination clause in his employment contract stated: 

Termination other than for cause will be with notice or pay in lieu of notice, based on your length of service. If the Employer terminates your employment for other than just cause you will receive the greater of:

  1. a)   Two weeks notice or pay in lieu of notice during the first two years of employment increasing by one week for each additional completed year of employment to a maximum of three months notice or pay in lieu of notice.


  1. b)   The minimum notice of termination (or pay in lieu of notice) required by applicable statutes.

Eleven years later, when Mr. McKercher was employed as a Business Centre Sector Leader, his employment was terminated. The employer paid him the three months termination pay he was owed under his employment contract.


Another way to attack a termination clause: What is the changed substratum doctrine?

An Ontario judge in a 2012 case, MacGregor v National Home Services, 2012 ONSC 2042 (CanLII), described this legal doctrine as follows: "The changed substratum doctrine … provides that if an employee enters into an employment contract that specifies the notice period for a dismissal, the contractual notice period is not enforceable if over the course of employment, the important terms of the agreement concerning the employee’s responsibilities and status has significantly changed."


The rationale for this doctrine has been described by one judge, Schmidt v AMEC Earth & Environmental Ltd., 2004 BSCS 2012 (CanLII), as follows: "In my view, it was incumbent on the defendants to advise Mr. Schmidt that they intended to continue to rely upon the termination provision set out in the Agreement when substantial changes in his employment occurred. This would have allowed him to consider the matter and to negotiate for other terms. If the defendants wished to continue to rely on the termination provisions there ought to have been a ratification of the provisions as the nature of Mr. Schmidt’s employment changed."



The judge hearing this case relied on the following factors when deciding not to enforce the termination clause in the employment contract: ”...there is no evidence that (the employer) made it clear to the (employee) that the notice of termination provisions were intended to apply to the positions to which he was promoted. The employment agreement contains no express wording to this effect, nor does it contain any wording to support the inference of such an intent. Further, and in keeping with the analysis in Schmidt, the Court received no evidence that, as it promoted the plaintiff, SAL reasserted its understanding and expectation that the notice of termination limit would remain in effect.”


Lesson to be learned:

An employer should make it clear that the termination clause in an employment contract applies when an employee is promoted. This expression of this intent should be in writing and should be clear and unambiguous. I recommend that an organization’s employment be reviewed by an employment lawyer every year or two. If your employment contract does not address this issue then think about doing so the next time it is reviewed.


For 30 years, Doug MacLeod of   the MacLeod Law Firm has been advising employers on all aspects of the employment relationship. If you have any questions, you can contact him at 416 317-9894 or at [email protected]

The material and information in this blog and this website are for general information only. They should not be relied on as legal advice or opinion. The authors make no claims, promises, or guarantees about the accuracy, completeness, or adequacy of any information referred to in this blog or its links. No person should act or refrain from acting in reliance on any information found on this website or blog. Readers should obtain appropriate professional advice from a lawyer duly licensed in the relevant jurisdiction. These materials do not create a lawyer-client relationship between you and any of the authors or the MacLeod Law Firm.



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