Canadian Lawyer

April 2021

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40 LEGAL REPORT LABOUR AND EMPLOYMENT notice and severance can and should be paid, there may be some unintended defect which can be effectively exploited to set aside the termination clause." For Steven Barrett, however, Waksdale is "yet another case confirming the general principle going back to Rizzo" (Rizzo & Rizzo Shoes Ltd. (Re)), the 1998 Supreme Court judgment regarding the priority of employees' interests when a company declares bankruptcy. Barrett was lead counsel for the successful appellants: the former employees. The principle stipulates that, in inter- preting the Employment Standards Act, courts should favour an interpretation that encourages compliance and extends protec- tions to employees as broadly as possible, says Barrett, who practises labour law and works on the employee/union side with Goldblatt Partners LLP in Toronto. There has been considerable litigation "Unless you can impose an unambiguous limitation of rights to reasonable notice consistent with the ESA, the employee is going to be entitled to reasonable notice." Steven Barrett, Goldblatt Partners LLP nation [and one is bad], they're all out for all purposes." One impact of the decision might be to discourage employers to be more generous than what the Employment Standards Act provides for, Attwell says. That's because it's easier, he says, to prepare a termination clause in an employment contract that limits an employee's entitlements to the statu- tory minimums. A more generous termina- tion clause that provides for a formula — a certain number of weeks' notice per years of service — is fairly common, but Attwell says Waksdale will make it easier to argue that, for example, an employee can't be required to work through their statutory severance pay entitlement periods. "And, so, that formula is now out, the whole termination clause is struck," and courts will then apply the more generous common law severance standards, he says. "Because of the nuances of how and when KEY FINDINGS FROM WAKSDALE a "for cause" termination clause was void because it did not comply with Ontario's minimum employment standards legislation a "without cause" termination clause was also rendered void, even though it was a separate clause and despite a severability provision in the contract

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