Can "For Any Reason" Wording Void Your Termination Clause in Ontario?

Does “For Any Reason” Language Void a Termination Clause in Ontario?

No — not automatically. The Ontario Court of Appeal confirmed in Baker v. Van Dolder’s Home Team Inc., 2026 ONCA 568 (CanLII) that phrases like “at any time” or “for any reason” do not, on their own, make a without-cause termination clause illegal. What matters is whether the clause, read in the full context of the contract, actually takes away rights the ESA guarantees.

This is a question that affects nearly every Ontario employee who has signed a written employment contract. If your contract has a termination clause, this ruling has a direct bearing on what you are owed if you are let go.

What Did the Court of Appeal Actually Decide?

The Court dealt with two separate employment contract disputes at the same time. In one case (Baker), the Court of Appeal allowed the employer’s appeal, finding the termination clause was valid. In the other (Li Contracts), the employer’s appeal was dismissed — but the termination clause in that case was also found to comply with the ESA.

The Court applied the principles from Wallace and Amberber — established cases on how to read employment contracts — and concluded that courts must look at the whole agreement, not cherry-pick individual words, when deciding whether a clause violates the ESA.

What Makes a Termination Clause Illegal Under the ESA?

A termination clause is unenforceable in Ontario if it takes away, or even attempts to take away, any right the ESA gives an employee. Those rights include minimum notice (or pay in lieu), continuation of benefits during the notice period, and severance pay where applicable.

The Court confirmed that the test is substantive, not cosmetic. Alarming-sounding phrases like “for any reason” do not automatically breach the ESA. If the clause, properly interpreted, still delivers everything the ESA requires, it survives. Our Ontario employment lawyers regularly review contracts to identify exactly this kind of hidden risk.

Can an Employer Define “Just Cause” More Broadly Than the ESA?

Yes, within limits. The ESA uses the phrase “wilful misconduct” as the threshold for denying minimum entitlements on termination. Employers sometimes define “just cause” in their contracts more broadly — capturing things like poor performance or dishonesty that might not meet the statutory wilful-misconduct bar.

The Court held that a broader contractual definition of just cause is not automatically void. The key is whether the clause preserves the employee’s ESA minimums even when the employer invokes that broader definition. If the contract effectively says “we can terminate for cause as we define it, but we will still meet our ESA obligations,” that structure can be enforceable. The Court called this “referential incorporation” of ESA entitlements — a drafting technique that ties the contract’s operation to the statute’s floor.

Is Waksdale Still Good Law After This Decision?

Yes, Waksdale v. Swegon North America Inc. remains binding. The Court refused to convene a five-judge panel to reconsider it. Under Waksdale, if a just-cause termination clause is illegal (because it would allow an employer to deny ESA minimums for conduct that doesn’t meet the wilful-misconduct standard), that illegality can contaminate the entire termination section — including the without-cause clause.

The reason Waksdale did not apply here is that both contracts in this case actually complied with the ESA. There was no illegal clause to spread contamination. Employees and employers should understand that Waksdale’s reach is unchanged: a badly drafted just-cause clause can still bring down an otherwise reasonable without-cause clause.

What Standard Do Appeal Courts Use to Review These Decisions?

The Court confirmed that contractual interpretation is generally reviewed on a deferential standard — meaning appeal courts do not simply substitute their own reading. However, where a lower court makes an “extricable error of law” — such as applying the wrong legal principle or ignoring a required factor — that error is reviewed on a correctness standard, meaning the appeal court decides the question fresh.

This matters because many termination-clause disputes turn on legal principles (like what the ESA requires), not just on the specific facts of a workplace. Errors on those legal questions are fully open to correction on appeal.

Practical Takeaways for Employees

• Get your contract reviewed before you sign. A clause that looks reasonable may still be unenforceable — or may cap your entitlements far below what common law would give you. An employment contract review can catch problems early.
• “For any reason” language is not automatically a red flag — but it is worth scrutinizing. The full contract context is what courts look at.
• If you are terminated for cause, ask whether the employer’s definition of cause meets the ESA standard. A broader contractual definition does not necessarily mean you lose your minimum entitlements.
• Waksdale still protects you. If your employer’s just-cause clause is illegal, it may void the entire termination section, entitling you to common-law reasonable notice instead of the contracted amount.
• Seek legal advice promptly after termination. Limitation periods apply, and the strength of your claim often depends on the specific wording of your contract.

If you are in the Hamilton or Burlington area and have questions about your termination clause or a recent dismissal, our Burlington employment law team is available to help.

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UL Lawyers offers a free initial consultation from our Burlington office and works with clients across Ontario. If you have questions about a termination clause or a wrongful dismissal claim, reach out to our Ontario employment law practice to discuss your situation.

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This article is automated commentary on a public court decision and is for general information only — not legal advice. Decisions rely on facts unique to each case. If you are affected by a similar issue, contact a lawyer for advice specific to your situation.