Ontario Severance

Working Notice — Ontario Employment Law

9 casesDecisions from 2004–2022

About Working Notice

In Ontario, when an employer decides to end an employment relationship without cause, they must provide the employee with advance warning. This warning frequently takes the form of "working notice." Instead of being immediately let go and receiving a lump sum payment (pay in lieu of notice), an employee on working notice is given a specific future termination date and is expected to continue performing their regular duties until that day arrives.

The Employment Standards Act, 2000 (ESA) sets out the absolute minimum termination notice employers must provide. For an employee with at least three months of continuous service, the ESA requires one week of notice if employed for less than one year, two weeks for one to less than three years, and then one week per completed year of service, capping at a maximum of eight weeks for eight or more years. Employers can legally satisfy this obligation by providing working notice. It is important to emphasize that statutory severance pay—an entirely separate entitlement under the ESA for employees with five or more years of service at large companies (payroll of $2.5 million or more)—must be paid as a lump sum or in authorized installments. Severance pay cannot be satisfied through working notice.

Beyond statutory minimums, employees may be entitled to larger common law reasonable notice periods depending on factors like age, length of service, character of employment, and the availability of similar jobs. Courts have ruled that there is no automatic formula for common law notice. Employers can technically provide working notice to cover common law obligations as well, but doing so creates unique workplace dynamics.

For working notice to be legally valid, the employer's communication must be clear and unequivocal regarding the exact termination date. Furthermore, the employer must keep the fundamental terms of employment intact during this transition. They cannot drastically reduce hours, cut pay, or impose significant demotions while the employee finishes their tenure. Additionally, statutory notice periods are designed, in part, to afford workers the opportunity to seek alternate employment. If an employer forces excessive overtime during this timeframe, or if they bungle administrative requirements like filing a Form 1 during a mass termination, they may be heavily penalized by the courts and owe the worker pay in lieu. Because the intricacies of transitional employment periods are legally complex, retaining professional legal counsel to assess your specific situation is strongly recommended to ensure your rights are being fully respected.

Frequently Asked Questions

Can I quit before my working notice period ends?

Yes, you can choose to resign during a working notice period. However, if you leave early, you generally forfeit your right to be paid for the remainder of the notice period, unless a specific agreement is negotiated with your employer.

Does my employer still owe me severance pay if they gave me working notice?

Yes, if you meet the specific qualifications for statutory severance pay under the Ontario Employment Standards Act. While working notice can satisfy your right to termination notice, severance pay is a distinct entitlement that must be paid out financially and cannot be given as working time.

What happens if my boss changes my job duties during the notice period?

Your employer cannot unilaterally impose fundamental changes to your employment terms, such as a major demotion or significant pay cut, while you are on working notice. If they do, this could constitute a breach of contract or constructive dismissal, entitling you to damages for the balance of the notice period.

Is my working notice valid if it was just an informal mention in an email?

Notice of termination must be clear, unequivocal, and specify a definitive end date. Ambiguous statements or casual warnings about potential future layoffs do not legally count as valid working notice in Ontario.

At what point should I ask an employment lawyer to review my working notice?

You should seek a legal assessment as soon as you receive your working notice. A lawyer can evaluate whether the length of the notice falls unlawfully short of your common law entitlements and ensure you do not inadvertently accept an inadequate package.

Are there deadlines to dispute the length of my working notice?

If your employer did not provide enough notice under common law, you generally have two years from the date you were notified of your termination to file a wrongful dismissal lawsuit in Ontario.

Common Scenarios

  • An employer issues six months of working notice to a senior manager but immediately strips them of their direct reports, removes their access to key systems, and assigns them mundane data entry tasks, effectively breaching the employment contract.
  • A manufacturing plant undergoes a mass termination, placing 60 employees on working notice for four months, but the employer fails to file the required Form 1 with the Director of Employment Standards on time, invalidating the statutory portion of the notice.
  • An administrative assistant is given eight weeks of working notice but is scheduled for excessive mandatory overtime to wrap up projects, making it impossible for them to attend job interviews or search for new work.
  • An employer provides 12 weeks of working notice to a long-term employee but decides to send the employee home after just three weeks because the office atmosphere has become awkward, forcing the employer to pay out the remaining nine weeks.

What You Should Know

  • Continue to perform your job duties professionally and diligently during the working notice period to ensure your employer has no grounds to terminate you for cause before your end date.
  • Keep a detailed daily record of your hours, duties, and workplace treatment; if your environment becomes toxic or your responsibilities are unfairly changed, this documentation will be vital.
  • Never sign a release or settlement document presented alongside a working notice transition plan until an experienced legal advocate has confirmed whether the timeframe meets your full common law entitlements.
  • Request reasonable time off for job interviews, as the primary purpose of statutory working notice under Ontario law is to provide you a runway to secure alternative employment.

Featured Cases

W. v. Procom Consultants Group Ltd.

2022 ONSC 6056 (CanLII) · 2022-11-15

The Divisional Court dismissed an appeal in a wrongful dismissal action concerning a fixed-term contract, addressing whether repeated extensions created indefinite employment, whether emails constituted effective working notice, and whether punitive damages were warranted for termination conduct.

contract interpretation fixed-term contract punitive damages working notice wrongful dismissal

P. v. Bravo Logistics Corporation

2021 ONSC 4455 (CanLII) · 2021-06-23

P. v. Bravo Logistics: Working Notice Appeal

This is an appeal from a trial judge's decision in a wrongful dismissal case involving an employee with seven years of service who was terminated without a written employment contract. The central issue was whether the employer's provision of ten weeks' working notice, later breached by preventing the employee from returning to work, constituted a valid agreement enforceable for damages or if it allowed the employee to claim common law notice. The Divisional Court reviewed whether the trial judge erred in enforcing the agreement and assessing damages based on the unpaid balance of that notice period.

breach of contract consideration damages termination working notice

W. v. CTS of Canada Co.

2018 ONCA 758 (CanLII) · 2018-09-19

Appeal Allowed in Part: Mass Termination ESA Obligations

This is an appeal to the Court of Appeal from a motion judge's summary judgment decision in a class action about mass termination rights under the Employment Standards Act. The representative employees sued the employer over the validity of their working notice period because the employer filed the mandatory Form 1 notice late and required them to work excessive overtime. The motion judge ruled that the employer had to file the form at the beginning of the 13-month working notice period, invalidating most of the notice given. The Court of Appeal allowed the appeal in part, ruling that the form only needed to be filed at the start of the eight-week statutory minimum notice period. Because the employer filed the form 12 days into that eight-week period, the employees were awarded 12 days' pay in lieu of notice, and the lower court's rulings invalidating notice during weeks of unlawful overtime were upheld.

employment standards mass termination overtime statutory interpretation working notice

N. v. Allstate Insurance Company of Canada

2017 ONCA 948 (CanLII) · 2017-12-05

N. v. Allstate: Working Notice & Compensation

This appeal concerns a wrongful dismissal claim where the appellant, an insurance agent, was terminated for cause after refusing to comply with fundamental changes to employment terms during a working notice period. The Court of Appeal for Ontario held that the respondents lacked the authority to impose such changes and that the appellant was entitled to compensation for the balance of the notice period.

compensation fundamental changes termination for cause working notice wrongful dismissal

W. v. CTS of Canada Co.

2017 ONSC 5695 (CanLII) · 2017-09-26

Mass Termination: No Credit for Working Notice

This class action concerns a plant closure and the employer's working notice under the Employment Standards Act. The court held that the Form 1 for a mass termination had to be filed when notice was first given, so the employer got no credit for the working notice given before it filed it, and no credit for any week in which employees worked overtime beyond ESA limits or overtime that hampered their job search. The Court of Appeal later reduced the Form 1 consequence to 12 days' pay (2018 ONCA 758).

employment standards mass termination severance pay termination working notice

B. v Milo-Food & Agricultural Infrastructure & Services Inc.

2017 ONSC 1789 (CanLII) · 2017-04-10

Wrongful Dismissal: Limitation Periods & Working Notice

This is a merits decision addressing the limitation periods for wrongful dismissal, intentional infliction of mental distress, and human rights claims following a termination where the plaintiff was given two years' working notice. The court held that the wrongful dismissal and severance pay claims were statute-barred because the action was commenced more than two years after the notice of termination, whereas the tort and human rights claims were not statute-barred as the alleged discriminatory and harassing conduct continued throughout the notice period.

human rights limitation periods mental distress working notice wrongful dismissal

S. v. BMO Nesbitt Burns

2012 ONSC 1825 (CanLII) · 2012-03-18

Wrongful Dismissal: Book of Business Damages & Double Recovery

This is an interlocutory decision regarding a wrongful dismissal claim where the plaintiff sought leave to amend his statement of claim to include damages for the value of his book of business. The court held that the proposed amendments introduced a new cause of action that was statute-barred under the Limitations Act, 2002, and that awarding such damages alongside pay in lieu of notice would constitute impermissible double recovery. Additionally, the court rejected the argument for a right to working notice, confirming that employees are entitled to pay in lieu of notice rather than a transition period.

amendments to pleadings double recovery limitations working notice wrongful dismissal

C. v. BMO Nesbitt Burns Inc.

2011 ONSC 3392 (CanLII) · 2011-06-09

Wrongful Dismissal: No Damages for Loss of Clientele

This is a Divisional Court decision regarding a wrongful dismissal claim where the plaintiff sought damages for loss of clientele and moral damages following termination without cause. The court ruled that the plaintiff had no right to working notice and that damages for loss of clientele were not recoverable under a wrongful dismissal claim. Additionally, the court found that amendments to the Statement of Claim introducing these new claims were statute-barred under the Limitations Act, 2002, and that moral damages were unavailable due to a lack of proven bad faith or harm.

limitation periods loss of clientele moral damages working notice wrongful dismissal

T. v. B.

2004 CanLII 39004 (ON CA) · 2004-11-16

Wrongful Dismissal: 18 Months Notice Upheld

This appeal addresses whether there is a functional legal difference between working notice and pay in lieu of notice, and whether an employer can unilaterally amend a notice period. The court held that no functional difference exists and that the employer was bound by the initial 18 months' working notice as no objective change justified the amendment to six months' pay in lieu. The court also determined that lack of bad faith did not warrant extending the notice period and awarded pre-judgment interest at 4.8%.

payment in lieu of notice pre-judgment interest reasonable notice working notice wrongful dismissal