Employment Contract Review in Ontario — Protect Your Rights
Before you sign an employment contract, have it reviewed. Many termination clauses, non-solicitation clauses, and probationary terms may be unenforceable under Ontario law.
Why Employment Contract Review Matters
An employment contract is a legally binding document that shapes every aspect of your working relationship — including what happens when it ends. Ontario courts have invalidated thousands of termination clauses over the past decade because they failed to meet ESA minimums at the time of termination, contained ambiguous language, or attempted to exclude benefits from the calculation. If your termination clause is found unenforceable, you may be entitled to common law reasonable notice instead — potentially worth months of additional compensation. Similarly, probationary clauses must be clearly stated in writing before employment begins, and overly broad confidentiality or non-solicitation agreements may not hold up in court. Having your contract reviewed before you sign is far less costly than discovering these issues after termination.
Key Clauses to Watch For
When reviewing an employment contract, these clauses deserve particular attention. Termination clauses: the clause must provide at minimum ESA entitlements — both termination pay and severance pay where applicable — and must not attempt to exclude continuation of benefits during the notice period. Probationary period clauses: Ontario courts generally recognize probationary periods of 3 months or less; longer probationary periods may be unenforceable without additional consideration. Non-competition clauses: since October 25, 2021, the Working for Workers Act, 2021 bans non-compete agreements in Ontario for most employees — only bona fide executives are potentially exempt. Non-solicitation clauses: these (prohibiting you from soliciting your former employer's clients or employees after leaving) remain valid in Ontario if they are reasonable in scope, duration, and geographic area. Confidentiality clauses: broad confidentiality provisions that could prevent you from working in your field may be challenged.
Reviewing an Offer Letter vs. a Full Contract
Many employers provide either a brief offer letter or a comprehensive employment agreement. An offer letter typically covers title, start date, salary, benefits, and vacation — and may include a termination clause. A full employment agreement covers all of this plus intellectual property rights, confidentiality, non-solicitation, and often a dispute resolution clause. Both should be reviewed. Key questions to ask about any offer: Is the salary fair for the market and for my qualifications? Are the benefits, vacation, and sick leave provisions acceptable? Does the termination clause comply with the ESA, or does it attempt to limit my rights below the legal minimum? Are there any restrictions (non-compete, non-solicitation, confidentiality) that would limit my future employment options? Taking time to have the contract reviewed before signing can protect your long-term interests significantly.
- Termination clause that limits notice to ESA minimums only
- Non-compete clause (likely unenforceable for most Ontario employees since Oct 2021)
- Probationary period longer than 3 months
- Confidentiality provisions so broad they could prevent you from working in your field
- Mandatory arbitration clause that waives your right to file ESA or Human Rights complaints