Terminated Without Cause? It Can Still Be Wrongful Dismissal

Many employees are surprised to learn that being terminated without cause does not always mean the termination was lawful or fair. Even if an employer has the right to end employment without alleging misconduct, that right must be exercised correctly. When it isn’t, the termination can still amount to wrongful dismissal under Canadian law.

Without Cause vs. Wrongful Dismissal

A termination without cause simply means the employer chose to end the employment relationship for business or performance reasons unrelated to misconduct. This is permitted, but only if the employer provides the employee with the proper notice period or pay in lieu of notice, as required by the Employment Standards Act, 2000 (ESA) and the common law.

A wrongful dismissal occurs when an employer fails to meet those legal obligations, for example, by providing insufficient notice, ending benefits too soon, or enforcing an invalid termination clause. In short, a termination may be “without cause” yet still be wrongful if the process or compensation was handled incorrectly.

Key Things to Review When You’re Terminated

1. The Termination Clause
   Review the termination clause in your employment contract carefully. Many clauses attempt to limit entitlements to ESA minimums, but courts have often found them unenforceable if they are poorly drafted or conflict with statutory rights.

2. Common Law Entitlements
   If your contract does not validly restrict your rights, you may be entitled to common law reasonable notice, which can be significantly higher than ESA minimums. Courts consider factors such as your age, role, length of service, and job market prospects.

3. Benefits Continuation
   Employers generally must continue benefits through the notice period. If coverage stops immediately, that may strengthen a wrongful dismissal claim.

4. Bonus and Commissions
   If you regularly earned bonuses or commissions, check whether they were excluded from termination pay. Unless the contract clearly says otherwise, they are often treated as part of overall compensation.

5. Timing and Pressure to Sign
   Employers frequently present termination offers with short deadlines. Take time to review the package with a lawyer before signing. Once signed, you may lose your right to claim additional compensation.

6. Record of Employment (ROE)
   Ensure your ROE does not state “dismissed for cause” when you were actually let go without cause. This affects Employment Insurance eligibility and may require correction.

Steps to Take After Termination

1. Do not sign anything right away.
   Ask for time to review the termination letter or release.

2. Collect all relevant documents.
   Include your employment contract, recent pay stubs, and any bonus or benefit information.

3. Consult a lawyer.
   Even a short consultation can clarify your rights and reveal whether you are owed more compensation.

Understanding Your Rights

Being terminated without cause is not always the end of the story. In many cases, employees are entitled to more than what their employer initially offers. Understanding the difference between a lawful termination and a wrongful one is essential to protecting your rights and ensuring fair treatment.

If you’ve been terminated without cause, it’s important to understand your rights before signing anything. What looks like a fair offer may fall short of what you are legally entitled to. At New Wave Lawyers, we help employees review termination packages, assess entitlements, and negotiate fair settlements.

Book a consultation to discuss your situation confidentially and find out what next steps make sense for you.