Opinions and Legal Insights

Keeping Babies in Bathtubs – ONSC Maintains Termination Clause Notwithstanding Contractual Issues

If an employment agreement contains one provision concerning the way by which one’s employer could terminate the agreement/employment with cause and a separate provision addressing the way by which the employer could terminate without cause, and the “for cause” provision is deemed to be illegal, then does that mean that the provision concerning “without cause” terminations is also illegal? Put another way, if the bathwater is polluted should we jettison the baby sitting in it? In Waksdale v. Swegon North America Inc., 2019 ONSC 5705, Justice Edward M. Morgan of the Ontario Superior Court of Justice (Toronto Region) held that just because one contractual provision is bad, doesn’t mean that one must overlook those provisions that are good.

Commentary

This case is helpful to employers, especially where certain, irrelevant aspects of their employment agreements are susceptible to attack. There has been a campaign, as of late, by plaintiff’s counsel to seek to find any technical non-compliance with the ESA and then argue that such non-compliance should void the entire employment agreement, even if other, relevant aspects of the contract are perfectly legal. The Waksdale case affirms the common sense principle that simply because one can find fault with one aspect of an agreement does not mean that an employee will necessarily be able to void the entire contract. Or, to go back to what I said before – just because the bathwater is dirty doesn’t mean we should lose the baby.