In Ontario, every employment relationship is an oral or written contract. Verbal agreements are okay, but written contracts structure the terms of how you are being paid.
Ontario’s Employment Standards Act (ESA) requires minimum notice, but such entitlements may be higher in the contract. You can consult a labour lawyer in Toronto to clarify whether the termination clause is legally sound and protects your rights.
An employment lawyer should review these documents to ensure they align with legal standards and work in your favor. Written contracts help avoid misunderstandings and disputes by clarifying who has what rights and responsibilities.
Key Elements to Look for in an Employment Contract
Termination Clause
It is essential to know about a termination clause. It specifies when either party can end the employment relationship. This section must contain conditions for termination with or without cause and the notice period required.
Probationary Period
The probationary period allows employers to test a new employee in the role. This period must be explicitly mentioned in the contract, and its duration and conditions must also be specified. If there is no probationary clause, common law may require employers to give reasonable notice or justification for termination, even in the first employment stage.
Compensation Clause
The compensation clause should outline your remuneration thoroughly, including base salary, benefits, bonuses, and other perks. This section is transparent so that you know how much you are being paid as a whole, and you can spot holes or missing parts in your compensation package.
Fixed Term vs. Indefinite Employment
In other words, you have to differentiate between employment for a fixed term or indefinite period. The duration and conditions for early termination of fixed-term contracts should be stated. If you are terminated prematurely, you may be entitled to compensation for the rest of the term without explicit terms.
Employee’s Duties, Responsibilities, and Location
Describing your role, responsibilities, and work location helps clarify and avoid disputes. Make sure the job, as discussed during the hiring process, is accurately reflected in the contract.
Non-Competition and Non-Solicitation Agreements
Non-competition clauses prevent you from taking a job in similar roles in some geographic regions at any time in the future. Non-solicitation clauses stop you from contacting the employer’s clients or employees after you’ve been laid off.
To be enforceable, these clauses must be reasonable in scope and duration. While overly restrictive terms might not stand up in court, it’s wise to have them reviewed by a legal professional to ensure you understand exactly what you agree.
Independent Legal Advice
You should be given enough time to seek independent legal advice before signing. By consulting with a Toronto labour lawyer, you will know what is in the contract and be better informed about its terms, thereby reducing the likelihood of future disputes.
Choice of Law
The contract law governing the contract has to do with the choice of law clause. It is essential if you are going to work in another province or country. Choose the jurisdiction appropriately and its impact on your rights and obligations under the contract.
Temporary Layoff
In common law, employers have no automatic right to lay off employees unless the contract allows it temporarily. Without such a clause, a temporary layoff could be treated as constructive dismissal, and you would be entitled to severance. The events of the COVID-19 pandemic have highlighted economic uncertainties, so it’s prudent to ensure this aspect is covered in your contract.
Both employers and employees should review their employment contracts with a qualified lawyer. Not having legal advice can result in misinterpretation and legal disputes. Bune Law provides consultation services to review and prepare employment contracts to ensure they are fair, transparent, and compliant with Ontario employment laws.
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