“At any time“, these three words have haunted employers since the Ontario Court of Appeal’s decision in Dufault v. Ignace (Township), 2024 ONSC 1029, aff’d 2024 ONCA 915, (“Dufault“).
Waksdale: One Invalid Clause Can Sink the Entire Termination Provision
This saga began with Waksdale v. Swegon North America Inc., 2020 ONCA 391 (“Waksdale“), in which the Ontario Court of Appeal held that if any portion of a termination clause breaches the Employment Standards Act, 2000 (“ESA”), the entire termination provision becomes void and unenforceable. The Court emphasized that employment agreements must be read as a whole, and employers cannot rely on severability clauses to save defective termination language.
Key takeaway:
A single offending phrase anywhere in the termination section can invalidate an entire termination clause, leaving the employee entitled to common law reasonable notice.
Dufault: Summary Judgment Decision Addressed “At Any Time” Language
Fast-forward to Dufault, at the motion for summary judgment, the motion judge held that a clause stating the employer could terminate the employee “at any time” violated the ESA because those words suggested the employer could terminate employment without complying with statutory restrictions, for example, ESA-prohibited periods such as protected leaves.
The motion judge reasoned that by purporting to allow termination “at any time,” the clause improperly expanded employer rights beyond what the ESA permits. Relying heavily on Waksdale, the court found the clause void and awarded common law notice.
But on Appeal… Silence on “At Any Time”
The Ontario Court of Appeal upheld the result in Dufault, but did not address the validity of the “at any time” phrase. The Court resolved the appeal entirely on different grounds, other defects in the termination language, leaving the motion judge’s reasoning on “at any time” neither endorsed nor rejected.
Chan v. NYX Capital: “At Any Time” Language Held to Breach the ESA
In Chan v. NYX Capital Corp., 2025 ONSC 4561 (“Chan”), the Ontario Superior Court expressly addressed the uncertainty left by Dufault and held that, read together, Waksdale, Dufault, and the ESA make it clear that an employer cannot rely on a right to terminate “at any time,” as doing so amounts to contracting out of the ESA.
Why? Because, as the Court explained, the phrase “at any time” necessarily includes times when termination is prohibited, for example, termination in reprisal for attempting to exercise a right under the ESA. Even if the employer did not intend the clause to operate unlawfully, its potential to violate the ESA is enough to make it unenforceable.
The Court found that this defect invalidated the entire termination provision, entitling the employee to common law reasonable notice.
Key takeaway from Chan
Ontario courts are increasingly willing to find aspects of an employment contract that purport to grant an employer rights not provided under the ESA, such as “at any time” language, as impermissibly broad, rendering a termination clause void and unenforceable on its face.
Bottom Line for Employers and Employees
Termination clauses are facing heightened scrutiny by Ontario courts. Even seemingly harmless wording, like “at any time”, can render an entire termination provision void and unenforceable, exposing employers to significant liability for common law notice. Whether you’re drafting, reviewing, or challenging an employment agreement, precision matters.
If you’re an employer looking to ensure your contracts comply with the latest ever evolving law or an employee seeking clarity on your termination rights, our team can help, contact our litigation and business lawyers to book a consultation.
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