What Is Wrongful Dismissal in Ontario: A Guide to Your Termination Rights

Let’s clear up a common point of confusion right away. In Ontario, wrongful dismissal isn’t about whether your employer had a “fair” or “good” reason to let you go. It’s all about whether they followed the legal rules when they did it.

For almost every employee, this boils down to one simple but crucial thing: were you given enough notice, or pay instead of notice?

The Core Principle of Termination in Ontario

Think of your employment agreement as being a bit like a lease on an apartment. Your landlord has the right to end the tenancy, but they can’t just show up, change the locks, and toss your stuff on the sidewalk. They have to give you proper, legal warning.

It works the same way with your job. An employer can end your employment for almost any reason (as long as it’s not discriminatory), but they absolutely must provide a legally sufficient heads-up first.

This “heads-up” is the notice period. A wrongful dismissal happens when your employer fails to give you that required notice, or a payment to cover that period, known as termination pay. The whole point is to provide a financial bridge, giving you time to find a comparable new job without facing immediate financial hardship.

Two Layers of Protection

In Ontario, two distinct sets of laws protect your right to notice. It’s vital to understand the difference between them.

• The Employment Standards Act, 2000 (ESA): This law lays out the bare minimum notice or pay that every provincially regulated employee must receive. Think of this as the absolute legal floor—an employer can never legally offer you less.
• The Common Law: This is law built from centuries of court decisions made by judges. For the vast majority of non-unionized employees, the common law provides for a much longer and more generous “reasonable notice” period than the ESA minimums. This is where most wrongful dismissal claims are fought and won.

The real question in a wrongful dismissal case isn’t “Was the reason for my firing unfair?” Instead, it’s, “Did my employer give me enough notice or pay for my specific situation, as required by law?” If they didn’t, the dismissal was wrongful.

The Rare Exception: Just Cause

There’s only one scenario where an employer can fire you on the spot without providing any notice or pay: when they can prove just cause.

This is an incredibly high legal bar to clear. Just cause is reserved for only the most severe forms of workplace misconduct, such as proven theft, serious fraud, or blatant insubordination that fundamentally destroys the employment relationship. Things like minor performance issues or not being a “good fit” almost never meet this standard.

Many employers who allege just cause find they can’t actually prove it in court. It’s important to remember that you have a limited window to take legal action after being terminated. You can learn more about the statute of limitations in Canada to understand these critical deadlines.

Understanding Your Termination Pay Rights

When you’re let go from a job in Ontario, the first severance offer you see is almost always based on one thing: the Employment Standards Act (ESA). Think of the ESA as the absolute floor—the bare minimum your employer is legally required to provide. It’s a basic safety net, but for most employees, it’s not the full story.

The reality is that what you’re truly owed is usually found in common law. This is a system built on decades of judges’ decisions that have established a standard of “reasonable notice,” which is often far more generous than the ESA minimums. Understanding the difference between these two tiers of termination pay is the first step to knowing if you have a wrongful dismissal claim.

The Two Tiers Of Termination Pay

A wrongful dismissal isn’t about why you were let go; it’s about how. It happens when an employer doesn’t give you enough notice or pay instead of notice. To figure out what’s “enough,” you have to look past the government’s basic rules.

This infographic cuts right to the heart of the matter: a wrongful dismissal case is almost always about the notice you received, not the reason for the termination itself.

As you can see, unless an employer can prove just cause for firing you (which is incredibly difficult to do), they have to provide proper notice or compensation. That’s where these two tiers come into play.

Tier 1: The Employment Standards Act (ESA) Minimums

The ESA lays out a simple, rigid formula for calculating termination and severance pay, based entirely on how long you worked there.

Termination Pay Under the ESA, you’re generally owed one week of notice (or pay) for every full year you worked, capping out at a maximum of eight weeks.

Severance Pay You might also qualify for severance pay on top of that. To get it, you must have worked there for at least five years, and your employer must have a global payroll of at least $2.5 million. If you meet both conditions, you get another week of pay for each year of service, up to a maximum of 26 weeks.

This is the number many employers will present as their final offer. But stopping here often means leaving a significant amount of money on the table.

An employer’s legal duty doesn’t end with the ESA. An offer that only meets these statutory minimums is often not a fair deal and can be the foundation of a wrongful dismissal claim. It’s simply the starting point, not the final destination.

Tier 2: Common Law Reasonable Notice

This is where your real entitlements are often found. Unlike the ESA’s cookie-cutter formula, common law reasonable notice is tailored to you. A judge considers several personal factors, recognizing that it takes different people different amounts of time to find a comparable new job.

The whole point of common law notice is to give you a financial bridge that reflects your unique situation. A judge in Ontario will look at things like:

• Your Age: Courts recognize that older workers often face more hurdles finding a new position.
• Length of Service: The longer you’ve dedicated to a company, the more notice you are generally owed.
• Character of Your Employment: Your role, seniority, and salary all matter. A senior manager with specialized skills will almost always get a longer notice period than a junior employee.
• Availability of Similar Employment: The court considers the job market. How hard will it be for someone with your skills and experience to find a similar job right now?

Because these factors are all weighed together, a common law notice period can be substantially longer than the ESA maximums—sometimes reaching up to 24 months or even more in exceptional circumstances.

ESA Minimums vs Common Law Notice: A Comparison

The difference between what the ESA guarantees and what the common law might award can be staggering. This table highlights just how far apart the two standards are.

Factor	Employment Standards Act (ESA) Entitlement	Common Law Reasonable Notice
Calculation	Rigid formula: 1 week per year of service.	Flexible assessment based on multiple factors.
Maximum Notice	8 weeks of termination pay.	No fixed cap, but typically up to 24 months.
Severance Pay	Capped at 26 weeks and has strict eligibility.	No separate “severance,” but the overall notice period is much longer.
Personal Factors	Your age, role, and the job market are irrelevant.	Your age, role, and job prospects are central to the decision.

Seeing the numbers side-by-side makes it clear: the ESA provides a baseline, but the common law looks at the bigger picture of what’s fair.

This huge gap is precisely why it’s so critical to have any severance offer reviewed by an employment lawyer. You can learn more about ESA termination rules in our detailed guide to see the specifics. Accepting that first offer without understanding your common law rights is often the biggest and most costly mistake a terminated employee can make.

Why ‘Just Cause’ Is So Rare in Ontario

When an employer fires you without any notice or severance pay, they’ll often throw around the term just cause. It sounds serious, and it is, but what it actually means under Canadian law is far more specific and much harder for an employer to prove than you might think.

In fact, establishing just cause is so difficult that it’s often called the “capital punishment” of employment law. This isn’t just a dramatic phrase; it reflects a legal reality.

An employer can’t just decide they have a good reason. They carry the heavy burden of proving, with concrete evidence, that your actions were so egregious they completely shattered the trust at the heart of your employment relationship. This high standard exists for a very good reason: to stop companies from inventing excuses to dodge their legal duty to provide a fair severance package.

The bar isn’t set at simple mistakes, occasional bad days, or personality clashes. We’re talking about misconduct that is wilful, deliberate, and strikes at the very core of your ability to do the job.

The Myth of Poor Performance as Just Cause

One of the biggest misconceptions we see is employers trying to claim just cause for poor performance. Let’s be clear: in the vast majority of cases in Ontario, this simply doesn’t fly. Failing to hit sales targets or just not being a superstar employee almost never meets the threshold for a just cause dismissal.

For an employer to even begin to argue just cause based on performance, they must have a perfect track record of progressive discipline.

An employer can’t just say, “You weren’t good at your job, so you’re fired with nothing.” A court will immediately ask, “What did you do to help them improve?” Without a crystal-clear paper trail of warnings, support, and opportunities to get back on track, a claim of just cause for performance will almost certainly fail.

This process isn’t a suggestion; it’s a series of mandatory steps:

• Clear Expectations: They must have told you exactly what was expected of you in your role.
• Explicit Warnings: You must have received clear, written warnings that your performance was not up to par and that your job was on the line if things didn’t change.
• Reasonable Opportunity: You must have been given a fair amount of time and a real chance to improve after being warned.
• Support and Training: A good employer should have offered help, whether it was extra training, resources, or guidance to help you succeed.

If your employer skipped these steps and went straight to termination, their argument for just cause is on incredibly shaky ground. This is precisely why getting advice from the best employment lawyers in Ontario is so critical; we can quickly evaluate whether your employer’s claims hold any water.

What Actually Counts as Just Cause?

So, if poor performance is usually off the table, what kind of behaviour could possibly meet this sky-high standard? The misconduct has to be serious, typically involving dishonesty, outright defiance, or a profound breach of trust.

The key question is: was the conduct so bad that continuing the employment relationship became impossible?

Examples of what might be just cause:

• Proven Theft or Fraud: Stealing from the company, faking expense reports, or engaging in other forms of financial dishonesty.
• Serious Insubordination: A direct and deliberate refusal to carry out a reasonable and lawful instruction from a manager. This isn’t just questioning an order; it’s outright defiance.
• Workplace Violence or Harassment: Physical violence, credible threats, or severe harassment against a coworker.
• Fundamental Dishonesty: Lying about a critical qualification on your resume that was essential for you to be hired in the first place.

Examples of what is typically NOT just cause:

• Minor Lateness or Absenteeism: Being late a few times, especially if there haven’t been formal warnings.
• A Bad Attitude or Poor Fit: Simply not getting along with the team or having a difficult personality.
• Isolated Mistakes: A one-time error in judgment, even if it had negative consequences.
• Off-Duty Conduct: What you do in your private life, as long as it doesn’t directly harm your employer’s business or your ability to do your job.

At the end of the day, context is everything. A single incident has to be incredibly severe to warrant a just cause termination. More often, an employer has to show a pattern of serious misconduct that you refused to correct despite being given clear warnings.

Recognizing a Constructive Dismissal

Sometimes, a termination isn’t obvious. There’s no formal letter, no sit-down with HR. Instead, your employer might try to force your hand by making your job unbearable or by fundamentally changing the role you were hired to do.

This is called constructive dismissal, and in the eyes of Canadian law, it’s treated just like a firing. Think of it as being pushed out the door without anyone ever saying “you’re fired.” Because your employer has essentially broken your employment agreement, your resignation is considered a termination, meaning you are still entitled to notice or a severance package.

A Single, Substantial Change to Your Job

The most straightforward type of constructive dismissal happens when your employer makes one major, negative change to a core part of your job without your consent. We’re not talking about small, everyday adjustments here; this has to be a significant breach of the deal you signed up for.

Imagine a marketing manager in Mississauga who suddenly gets their salary slashed by 20%. Or a senior accountant in Burlington who is abruptly demoted to a junior role with far less responsibility, even if their pay stays the same. These aren’t minor tweaks—they fundamentally alter the very nature of the job.

Other classic examples in Ontario include:

• A forced relocation: Your contract specified a local office, but now you’re being told to work in a location that adds hours to your daily commute.
• A dramatic change in duties: Key responsibilities are stripped away, effectively gutting your role of its seniority and purpose.
• A significant cut in compensation: This could be a direct pay cut, the elimination of a major bonus, or a change to your commission structure that drastically reduces your income.

The change has to be substantial and detrimental to you. A minor shift in responsibilities or a temporary pay freeze probably won’t meet the legal test.

The biggest mistake an employee can make is to simply keep working under these new, diminished conditions without formally objecting. By staying silent and carrying on, you risk implying that you’ve accepted the new terms, which can destroy your legal claim. It is absolutely vital to get legal advice immediately.

A Pattern of Toxic Behaviour

A constructive dismissal can also be a slow burn. It might not be one single event but a series of actions that, over time, create a poisoned or intolerable work environment. This can be more subtle and harder to prove, but it’s just as serious.

This could look like ongoing harassment, bullying, or a manager who consistently undermines you to the point where coming to work feels impossible. For example, a supervisor who constantly berates an employee in front of others, isolates them from team projects, and sets them up to fail could be creating the grounds for a constructive dismissal.

Sadly, this is all too common. Unjust dismissal complaints, which often involve scenarios where the workplace becomes intolerable, are a major issue in Canada. In fact, they accounted for a staggering 47% of all applications to the Canada Industrial Relations Board in the 2021-22 fiscal year. As you can discover from these insights on Canadian workplace violations, this data shows just how often employees feel they have no option but to leave.

If you believe your employer is fundamentally changing your job or fostering a toxic environment, you need to understand your rights before you make a move. You can learn more about constructive dismissal in Ontario in our detailed guide. Speaking with a lawyer before you resign is the smartest way to protect your right to severance.

How Your Severance Package Is Calculated

If your employer lets you go without providing proper notice, the big question becomes: “What am I actually owed?” Unlike the simple, bare-bones formula found in the Employment Standards Act, there’s no magic calculator for common law severance. Instead, Ontario courts take a much more nuanced and personal approach to figure out what’s fair for your specific situation.

This whole process is guided by a set of criteria that have been around for decades, known as the Bardal factors. They come from a landmark Ontario court case back in 1960, and their purpose is to help a judge estimate how long it will likely take someone in your shoes to find a comparable new job.

The Four Key Bardal Factors

Think of these factors not as a checklist, but as four ingredients in a recipe. A judge looks at them all together to get a complete picture of your employment story and land on a reasonable notice period.

1. Your Age at Termination: Let’s be frank: courts in Ontario know that age can be a real hurdle when job hunting. A 58-year-old manager will almost always get a longer notice period than a 28-year-old coordinator because, realistically, it’s tougher for older workers to land similar roles.

2. Your Length of Service: The longer you’ve been with a company, the more notice you’re generally entitled to. Common law recognizes and rewards that kind of long-term loyalty. Someone with 20 years of service has built their professional life around that job, making a sudden termination far more disruptive than it would be for an employee who has only been there for two years.

3. The Character of Your Employment: This is all about your role. What was your title, your seniority level, your responsibilities, and your salary? Highly specialized or senior employees—think a Chief Financial Officer or a niche software engineer—often get longer notice periods simply because there are fewer of those jobs out there. The search is just going to take longer.

4. Availability of Similar Employment: The court also has to look at the real world. Is the economy in a downturn? Is your specific industry struggling? If you work in a field with only a handful of employers in the Greater Toronto Area, that reality will be factored in to extend your notice period.

How the Factors Work Together in Practice

To really see how these factors play off each other, let’s look at two completely different scenarios.

Example A: Meet Sarah. She’s a 58-year-old Senior Marketing Director who was just terminated from a tech firm in Burlington. She had been there for 22 years, earning a high salary with major responsibilities. Given her age, long service, senior role, and the tough market for executive jobs, a court would likely award her a significant notice period, probably somewhere in the range of 18 to 24 months.

Example B: Now consider Mark. He’s a 28-year-old administrative assistant who worked at the same company for two years. His role is more general, with plenty of similar positions available across the GTA. When you look at his younger age, short service, and junior role, his reasonable notice period would be much shorter—likely landing between 2 to 4 months.

This is exactly why a one-size-fits-all severance calculator just doesn’t work in the real world. For a deeper dive into your specific entitlements, you can explore our comprehensive guide on notice and severance rights in Ontario.

The Bardal factors ensure that your severance package isn’t just a generic calculation but a personalized assessment of your unique circumstances. It’s about fairness and providing a realistic bridge to your next career opportunity.

When Employer Conduct Leads to Additional Damages

The calculation doesn’t always stop with severance. If your employer handled your dismissal in a particularly unfair, cruel, or dishonest way, a court can award additional damages on top of your notice period. These are often called aggravated or punitive damages.

This could happen if your employer makes false accusations of just cause to avoid paying you, harasses you during the termination meeting, or deliberately misleads you about your legal rights.

A recent Ontario case from 2023, Russell, is a perfect example. A 36-year employee was awarded a 24-month notice period. But the court didn’t stop there. It also awarded an additional $25,000 in aggravated damages because the employer’s termination letter was so confusing about his rights that it caused him significant mental distress. As you can discover from trends in Canadian wrongful dismissal cases, how an employer behaves during a termination can have a direct and costly impact on the final outcome.

Your Action Plan After a Termination

Losing your job is a shock. The moments after being terminated can feel overwhelming and confusing, with your mind likely racing. But the steps you take right away are critical to protecting your rights. If you think you might have a case for wrongful dismissal in Ontario, this guide will help you navigate the immediate aftermath.

Here’s the single most important rule to remember: do not sign any termination papers or release forms on the spot. It’s common for employers to present these documents to pressure you into accepting a lowball offer and signing away your legal rights. Your best response is to politely state that you need time to review everything and will get back to them.

Once you’ve left that meeting, your priority is to get organized. Following a clear checklist can bring a sense of order to a chaotic situation and ensure you have everything needed to build a strong case.

Your Post-Termination Checklist

Start by methodically gathering your information and taking control of the situation. Every step you take from this point forward is about preserving your options and understanding where you stand legally.

1. Politely Decline to Sign: Keep your immediate response calm and professional. All you need to say is, “Thank you for this information. I need some time to review it properly before I sign anything.” This simple sentence is your most powerful first move.

2. Gather Key Documents: Now is the time to collect every piece of paper related to your job. This means your original employment contract, the termination letter, recent pay stubs, records of any commissions or bonuses, and performance reviews.

3. Write Everything Down: While the details are still fresh in your mind, write out a detailed, chronological account of the termination meeting. Make a note of who was there, what was said by everyone, and the general tone of the conversation.

Remember, time is not on your side. In Ontario, wrongful dismissal claims are subject to strict legal deadlines, known as limitation periods. If you wait too long, you could lose your right to seek compensation entirely. A quick consultation can secure your rights.

Understanding Your Next Legal Steps

With your initial documents gathered, the next two steps are about fulfilling your legal duties and getting expert advice.

4. Begin Your Job Search: In Ontario, the law says you have a “duty to mitigate” your losses. In plain English, this means you have to make a reasonable effort to find a new, comparable job. Start looking right away and keep detailed records of your search—every application you send, every interview you attend, and every networking conversation you have.

5. Contact an Employment Lawyer Immediately: This is the most crucial step. An experienced Ontario employment lawyer can look over your severance offer, explain what your rights are under common law, and tell you if you have a valid claim for wrongful dismissal.

If you are thinking about leaving your job, maybe because of issues that could be considered constructive dismissal, it’s also important to know how to write a professional resignation letter to protect your rights and professional reputation. An initial legal consultation will give you the clarity and direction you need to make sure your next move is the right one.

Your Top Wrongful Dismissal Questions, Answered

Losing your job is overwhelming, and the legal jargon that follows can make things even more confusing. To help clear things up, here are some straightforward answers to the questions we hear most often from people in your exact situation.

Do I Have to Sign My Termination Papers?

No. In fact, you probably shouldn’t.

When an employer hands you termination papers, they almost always contain a “release.” Signing it means you agree to their severance offer and give up your right to sue for more—even if you’re entitled to a much larger package. It’s a full and final settlement.

It’s perfectly acceptable to say, “Thank you, I’d like some time to review this with my family and get some advice.” Taking a day or two to understand what you’re signing is the smartest move you can make.

How Long Do I Have to Sue for Wrongful Dismissal in Ontario?

In Ontario, the standard deadline is two years from the day you were terminated. This is called a limitation period. If you don’t file a claim within that window, you unfortunately lose your right to pursue what you’re owed.

While two years sounds like plenty of time, it flies by. Building a strong case and negotiating with your former employer takes time, so it’s always best to speak with a lawyer as soon as possible.

Can My Employer Fire Me for Any Reason?

Yes, for the most part. As long as the reason isn’t discriminatory (based on your age, race, gender, disability, etc., under the Ontario Human Rights Code), an Ontario employer can end your employment for almost any reason—or no reason at all. This is known as a termination without cause.

But here’s the crucial part: they have to pay for that right. A wrongful dismissal claim isn’t about whether the firing was unfair. It’s about whether your employer gave you the proper notice or severance pay you are legally entitled to receive.

A termination without cause is perfectly legal. What’s illegal is failing to provide the proper compensation for it. The entire focus of a wrongful dismissal case is on the severance package, not the reason you were let go.

While you figure out your legal next steps, staying organized in your job hunt is key. Using a good job application tracker can help you manage your search without adding more stress to your plate.

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If you’ve been let go and feel the severance offer just isn’t right, you don’t have to navigate this alone. Contact UL Lawyers for a free consultation. Our firm is based in Burlington, but we proudly serve clients across the GTA and all of Ontario. We’ll help you understand your rights and figure out the best path forward. Visit us at https://ullaw.ca to get started.