An overview of Ontario provincial legislation and regulations pertaining to employee termination
Understanding the legal framework and obligations is crucial for employers in Ontario looking to terminate an employee fairly and effectively. This guide outlines the key steps, legal requirements, and best practices—complete with Canadian and Ontario-specific references.
1. Legal Foundations: Federal & Provincial Standards
Federal Employers (Canada Labour Code)
If your organization falls under federal jurisdiction, you must adhere to the Canada Labour Code. Terminations must be handled as follows:
- Provide at least 2 weeks’ written notice, or pay in lieu.
- For employees with 3+ years’ service, notice increases to 1 week per completed year, up to a maximum of 8 weeks.
- A Statement of Benefits—detailing wages, vacation pay, severance, and other entitlements—must also be provided
b) Ontario-Regulated Employers (Employment Standards Act, ESA)
In Ontario, the ESA sets minimum termination requirements:
- Employees with 3+ months of continuous service are entitled to notice or pay in lieu; this includes termination pay
- Severance pay is required for those with 5+ years of service and if the employer’s payroll exceeds $2.5 million—calculated as the higher of 5 days’ wages or 2 days×years worked
- Employing “just cause” termination (e.g., serious misconduct) avoids this requirement—but must be well-documented
2. Human Rights & Wrongful Dismissal Considerations
Ontario employers must avoid terminations that contravene the Ontario Human Rights Code (e.g., based on race, gender, disability). Firing due to attendance related to a protected disability, without proper accommodation, is discriminatory
Wrongful dismissal claims may arise if proper notice or reasonable cause isn’t provided. Common-law principles may require longer notice than the ESA minimum depending on employee’s age, length of service, or seniority
3. Best Practices for Conducting Fair Termination
| STEP | BEST PRACTICE |
| 1. Document grounds clearly | Whether performance-related or economic, ensure clear documentation. |
| 2. Use progressive discipline | Especially for conduct or performance issues – outline expectations and offer improvement opportunities. |
| 3. Provide ESA-legal entitlements | Notice, termination pay, and severance as applicable, plus a statement of benefits. |
| 4. Address discrimination and accommodation | Consult HR/legal if disability or protected grounds are involved. |
| 5. Offer compassionate communication | A respectful approach preserves employer brand and minimizes conflict. |
| 6. Avoid retaliation and ensure procedural fairness | Particularly with unionized or protected-status employees. |
4. Compliance Enforcement & Claims
Ontario’s Ministry of Labour enforces ESA standards. Common claims involve unpaid termination/severance or missing benefits
Inspections and complaints can lead to orders and penalties.
For non-unionized Ontario Public Service (OPS) workers, the Public Service Grievance Board offers a path for challenging unfair terms or dismissals under applicable acts
5. Key Statistics & Broader Context
- In Ontario, approximately 39% of all federally regulated employees in Canada are located in the province—highlighting the relevance of Code-based rules
- A 2017 Ontario Human Rights Commission survey found that 45% of individuals who experienced discrimination at work cited those experiences, with common grounds being race (63%), sexual orientation (34%), and disability (25%)
- Nearly 26% of Canadians reported experiencing discrimination or unfair treatment in Q4 2024, including in workplace or employment contexts
Federal resources:
Final Takeaway
Terminating an employee in Ontario is a nuanced process requiring:
- Full compliance with ESA or Canada Labour Code requirements.
- Thorough documentation of the termination basis.
- Respect for human rights obligations and accommodation duties.
- Clear communication with affected employees.
- Preparedness for potential legal or administrative challenges.
By following the legal standards and applying best practices, employers can manage separations smoothly, respectfully, and lawfully.
613-869-9130 | info@globalmindfulsolutions.com
343 Preston Street, Suite 1100, Ottawa, ON, K1S 1N4
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