Canada: Probationary Employees: Employers' Termination Rights And Restrictions

Co-authored by: Carol-Anne Wyseman

First presented at an Employment Law Seminar

Given that employers have an implied contractual right to dismiss a probationary employee without notice and without giving reasons, many employers believe that they are immune from claims brought against them after terminating an employee within his or her probationary period. Unfortunately for employers, this is not the case. Despite the existence of probationary periods, there are many limitations facing employers who wish to fire their probationary employees. It is crucial that employers understand these limitations in order to prevent claims from being brought against them.

Good Faith Assessments

First, employers must act in good faith in the assessment of the probationary employee's suitability for a permanent position.1 Not only that, but the Prince Edward Island Court of Appeal has stated that the test "has gone beyond the establishment of good faith in the employer's exercise of discretion" and requires both fairness and reasonable diligence.2 The Prince Edward Island Court of Appeal noted that the requirement that an employer act fairly and reasonably in making decisions about a probationary employee requires regular evaluation from the employer and discussions between the employer and employee about the employee's performance. These requirements give the employee an opportunity to "correct any defective action".3

The following is the test provided by the Alberta Court of Appeal for dismissing probationary employees:

...the employer need only establish that

  1. he had given the probationary employee a reasonable opportunity to demonstrate his suitability for the job;
  2. he decided that the employee was not suitable for the job;
  3. that his decision was based on an honest, fair and reasonable assessment of the suitability of the employee, including not only job skills and performance, but character, judgment, compatibility, reliability, and future with the company".4

In deciding suitability, the employer's standards must be reasonable enough that it is possible for a probationary employee to succeed.5

Although these are not Ontario cases, they are persuasive and clearly state that the employer must establish that the terminated probationary employee was unsuitable based on the criteria above.

More recently, in Cao v SBLR LLP,6 a tax accountant was hired by an accounting firm. Her employment contract stipulated a probationary period of three months. However, it did not include a notice period for termination within the probationary period. The employee was terminated during her first month of employment. Her employer advised that her performance was insufficient and that she needed to obtain her Certified General Accountant designation by the following summer, despite the course schedule making this impossible. The Ontario Superior Court of Justice considered the following facts to determine whether the employer satisfied its duty to act reasonably and fairly towards the employee:

  • The employee was given just five tasks to perform during the term of her employment;
  • The employee had not been given any negative feedback before the termination meeting;
  • The employer did not complete performance reviews before terminating the employee; and,
  • The termination letter did not allege just cause for her dismissal.

As a result, the Court concluded that the employer lacked cause to terminate the employee and that the employer terminated the employee in bad faith. As a result, the employee was awarded damages in the amount of four months' notice, which totalled $20,000.00, plus costs and disbursements.

Manner of Termination

In addition, an employer has a duty to act in good faith in the manner of termination of an employee.7 The employer must not engage in behavior that is unfair or is in bad faith.

i. Notice Period

Despite employers having an implied contractual right to dismiss a probationary employee without notice, courts have held that probationary employees are entitled to a notice period.8 In fact, in Mourant, a plaintiff who found alternative employment within a short period of time after his dismissal was nonetheless entitled to a 9-month notice period.9

Likewise, in Taggart v K.D.N. Distribution & Warehousing Ltd.,10 the plaintiff was terminated after three months of employment. He had been hired to start up a business for the defendants. The plaintiff asserted that he was unjustly dismissed. The Nova Scotia Superior Court acknowledged that employers face a "lower standard when justifying the dismissal of a probationary employee".11 Nevertheless, the Court reasoned that a probationary employee is "not retained exclusively 'at the will' of the employer".12 Importantly, the Court found that probationary employees should have reduced awards compared to regular employees. In finding this, the Court referred to Kirby v Motor Coach Industries,13 in which the Manitoba Court of Appeal stated:

At the very least the plaintiff's probationary status has an effect on the length of notice. What constitutes reasonable notice for a probationary employee may well be insufficient for a regular employee. In the instant case, probationary status is reflected in the magnitude of the compensation in lieu of notice. Probationary status is one of the circumstances to take into account in assessing appropriate compensation.

Nevertheless, the Court in Taggart held that if the plaintiff was deemed to be a probationary
employee, he would be entitled to four months' notice.

ii. Damages

Courts have also repeatedly recognized that short term and probationary employees are more
vulnerable than normal employees, and as a result have awarded higher damages in wrongful
dismissal actions.

The following are examples of the higher damages that have been awarded to probationary

  • A probationary employee who was dismissed after three months was awarded six
    months' pay in lieu of notice.14
  • A fire inspector who was terminated after 3.5 months was awarded five months' pay in
    lieu of notice.15
  • A manager who was terminated after 13 months was awarded six months' pay in lieu of
  • A senior executive at a Montreal firm who was terminated after 11 days was awarded almost six months' pay in lieu of notice and $8,000 in moral damages.17


Employers must be aware that probationary employees may be entitled to notice upon termination. In order to avoid claims against them, employers must act in good faith in the assessment of the probationary employee's suitability for a permanent position. Moreover, employers have a duty to act in good faith in the manner in which they terminate employees.

1 Jadot v Concert Industries Ltd. (1995), 10 CCEL (2d) 13 (BCSC); aff'd, 1997 CanLII 4137 (BCCA), 33 CCEL
(2d) 29 (BCCA).
2 Alexander v Padinox Inc., 1999 CanLII 4542 at para 17.
3 Ibid at para 24.
4 Higginson v Rocky Credit Union Ltd., 1995 ABCA 132 at para 6.
5 Mourant v Amherst (Town), 1999 CanLII 3303 (NSSC), 177 N.S.R. (2d) 75 (SC), [Mourant].
6 2012 CarswellOnt 9184..
7 Mourant, supra note 5.
8 Easton v Winslow Properties Corp., Ontario Superior Court of Justice, February 9, 2001 (Lederman J.).
9 Mourant, supra note 5.
10 1997 CanLII 14952 (NSSC).
11 Ibid at para 29.
12 Ibid
`3 1981), 1 C.C.E.L. 260.
14 Longshaw v Monarch Beauty Supply Co., 1995 Carswell BC 971.
15 Alishad v J.D. Collins Fire Protection Co., 2006 CarswellOnt 7285.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

To print this article, all you need is to be registered on

Click to Login as an existing user or Register so you can print this article.

In association with
Related Video
Up-coming Events Search
Font Size:
Mondaq on Twitter
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
Email Address
Company Name
Confirm Password
Mondaq Topics -- Select your Interests
 Law Performance
 Law Practice
 Media & IT
 Real Estate
 Wealth Mgt
Asia Pacific
European Union
Latin America
Middle East
United States
Worldwide Updates
Check to state you have read and
agree to our Terms and Conditions

Terms & Conditions and Privacy Statement (the Website) is owned and managed by Mondaq Ltd and as a user you are granted a non-exclusive, revocable license to access the Website under its terms and conditions of use. Your use of the Website constitutes your agreement to the following terms and conditions of use. Mondaq Ltd may terminate your use of the Website if you are in breach of these terms and conditions or if Mondaq Ltd decides to terminate your license of use for whatever reason.

Use of

You may use the Website but are required to register as a user if you wish to read the full text of the content and articles available (the Content). You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these terms & conditions or with the prior written consent of Mondaq Ltd. You may not use electronic or other means to extract details or information about’s content, users or contributors in order to offer them any services or products which compete directly or indirectly with Mondaq Ltd’s services and products.


Mondaq Ltd and/or its respective suppliers make no representations about the suitability of the information contained in the documents and related graphics published on this server for any purpose. All such documents and related graphics are provided "as is" without warranty of any kind. Mondaq Ltd and/or its respective suppliers hereby disclaim all warranties and conditions with regard to this information, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. In no event shall Mondaq Ltd and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use or performance of information available from this server.

The documents and related graphics published on this server could include technical inaccuracies or typographical errors. Changes are periodically added to the information herein. Mondaq Ltd and/or its respective suppliers may make improvements and/or changes in the product(s) and/or the program(s) described herein at any time.


Mondaq Ltd requires you to register and provide information that personally identifies you, including what sort of information you are interested in, for three primary purposes:

  • To allow you to personalize the Mondaq websites you are visiting.
  • To enable features such as password reminder, newsletter alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our information providers who provide information free for your use.

Mondaq (and its affiliate sites) do not sell or provide your details to third parties other than information providers. The reason we provide our information providers with this information is so that they can measure the response their articles are receiving and provide you with information about their products and services.

If you do not want us to provide your name and email address you may opt out by clicking here .

If you do not wish to receive any future announcements of products and services offered by Mondaq by clicking here .

Information Collection and Use

We require site users to register with Mondaq (and its affiliate sites) to view the free information on the site. We also collect information from our users at several different points on the websites: this is so that we can customise the sites according to individual usage, provide 'session-aware' functionality, and ensure that content is acquired and developed appropriately. This gives us an overall picture of our user profiles, which in turn shows to our Editorial Contributors the type of person they are reaching by posting articles on Mondaq (and its affiliate sites) – meaning more free content for registered users.

We are only able to provide the material on the Mondaq (and its affiliate sites) site free to site visitors because we can pass on information about the pages that users are viewing and the personal information users provide to us (e.g. email addresses) to reputable contributing firms such as law firms who author those pages. We do not sell or rent information to anyone else other than the authors of those pages, who may change from time to time. Should you wish us not to disclose your details to any of these parties, please tick the box above or tick the box marked "Opt out of Registration Information Disclosure" on the Your Profile page. We and our author organisations may only contact you via email or other means if you allow us to do so. Users can opt out of contact when they register on the site, or send an email to with “no disclosure” in the subject heading

Mondaq News Alerts

In order to receive Mondaq News Alerts, users have to complete a separate registration form. This is a personalised service where users choose regions and topics of interest and we send it only to those users who have requested it. Users can stop receiving these Alerts by going to the Mondaq News Alerts page and deselecting all interest areas. In the same way users can amend their personal preferences to add or remove subject areas.


A cookie is a small text file written to a user’s hard drive that contains an identifying user number. The cookies do not contain any personal information about users. We use the cookie so users do not have to log in every time they use the service and the cookie will automatically expire if you do not visit the Mondaq website (or its affiliate sites) for 12 months. We also use the cookie to personalise a user's experience of the site (for example to show information specific to a user's region). As the Mondaq sites are fully personalised and cookies are essential to its core technology the site will function unpredictably with browsers that do not support cookies - or where cookies are disabled (in these circumstances we advise you to attempt to locate the information you require elsewhere on the web). However if you are concerned about the presence of a Mondaq cookie on your machine you can also choose to expire the cookie immediately (remove it) by selecting the 'Log Off' menu option as the last thing you do when you use the site.

Some of our business partners may use cookies on our site (for example, advertisers). However, we have no access to or control over these cookies and we are not aware of any at present that do so.

Log Files

We use IP addresses to analyse trends, administer the site, track movement, and gather broad demographic information for aggregate use. IP addresses are not linked to personally identifiable information.


This web site contains links to other sites. Please be aware that Mondaq (or its affiliate sites) are not responsible for the privacy practices of such other sites. We encourage our users to be aware when they leave our site and to read the privacy statements of these third party sites. This privacy statement applies solely to information collected by this Web site.

Surveys & Contests

From time-to-time our site requests information from users via surveys or contests. Participation in these surveys or contests is completely voluntary and the user therefore has a choice whether or not to disclose any information requested. Information requested may include contact information (such as name and delivery address), and demographic information (such as postcode, age level). Contact information will be used to notify the winners and award prizes. Survey information will be used for purposes of monitoring or improving the functionality of the site.


If a user elects to use our referral service for informing a friend about our site, we ask them for the friend’s name and email address. Mondaq stores this information and may contact the friend to invite them to register with Mondaq, but they will not be contacted more than once. The friend may contact Mondaq to request the removal of this information from our database.


This website takes every reasonable precaution to protect our users’ information. When users submit sensitive information via the website, your information is protected using firewalls and other security technology. If you have any questions about the security at our website, you can send an email to

Correcting/Updating Personal Information

If a user’s personally identifiable information changes (such as postcode), or if a user no longer desires our service, we will endeavour to provide a way to correct, update or remove that user’s personal data provided to us. This can usually be done at the “Your Profile” page or by sending an email to

Notification of Changes

If we decide to change our Terms & Conditions or Privacy Policy, we will post those changes on our site so our users are always aware of what information we collect, how we use it, and under what circumstances, if any, we disclose it. If at any point we decide to use personally identifiable information in a manner different from that stated at the time it was collected, we will notify users by way of an email. Users will have a choice as to whether or not we use their information in this different manner. We will use information in accordance with the privacy policy under which the information was collected.

How to contact Mondaq

You can contact us with comments or queries at

If for some reason you believe Mondaq Ltd. has not adhered to these principles, please notify us by e-mail at and we will use commercially reasonable efforts to determine and correct the problem promptly.