Module 3 - Employment Contracts & Terminations

Question 1

Employment Contract

Answer 1

A contract entered into between employers and employees that sets out the rights, responsibilities, and obligations of both parties. For example, it can outline the duties to be performed by the employee and the wage the employer is obligated to remunerate the employee.

Question 2

Termination Clause

Answer 2

A clause that sets out an employee’s entitlements and an employer’s responsibilities upon termination. These clauses often set out the circumstances under which an employee may be terminated with or without cause and define a terminated employee’s entitlements.

Question 3

What can limit an employee’s termination entitlement?

Answer 3

An unambiguous and clearly worded termination clause

Question 4

What 2004 case did the court find to have an unambiguous termination clause?

Answer 4

Lloyd v. Oracle

Question 5

Are the courts in favour of enforcing termination clauses or common law?

Answer 5

Common law. Termination clauses must be clear as crystal

Question 6

Why would courts be in favour of common law termination entitlements?

Answer 6

Vague termination clauses

Question 7

What are 3 factors of a good termination clause?

Answer 7

1. Unambiguous
2. Clearly worded
3. Understood properly by the employee

Question 8

What should a good HR professional do if they aren’t sure about the clarity of a termination clause?

Answer 8

Seek legal advice

Question 9

Can a termination clause strike out ESA entitlements?

Answer 9

NO. ESA entitlements are Barr minimum. If the termination clause does this, it would be unenforceable and the courts would rule in favour of common law entitlements (which are usually more and in favour of the employee)