An Alberta court recently had the opportunity to consider the
question of whether a termination clause was effective to take away
an employee's entitlement to pay in lieu of notice of
termination in excess of the minimum set out in the Alberta
Employment Standards Code ("Code"). The
Plaintiff in this case was a 17 year employee who was terminated
without cause. The employer paid her the equivalent of 8 weeks
salary, relying on a termination clause in the employment agreement
which purported to limit her termination notice to the amount
required under the Code. Given her length of service, the employee
was entitled to the maximum of 8 weeks.
The Plaintiff sued for wrongful dismissal and applied for
summary judgment. The sole issue for the summary judgment
application was whether the termination clause barred the
Plaintiff's claim for damages beyond the 8 weeks. The clause in
In the event that [the employer] terminates your employment
without cause, [the employer] will provide the notice or pay in
lieu of notice required by the Alberta Employments Standard [sic]
Code or other applicable legislation. You are not entitled to any
other termination notice, pay in lieu of notice, or other
The Court considered the termination clause to be "clear,
express and unambiguous" and stated that it was
"difficult to think of wording that might make the
employer's intention any clearer". The Court therefore
dismissed the Plaintiff's application, finding that the
employer's defence that the claim was barred by the termination
clause had merit, and accordingly the matter should proceed to
trial, absent an application by the employer for summary
This decision provides helpful guidance to employers, although
it is important to note that there is also a significant body of
case law invalidating termination provisions. As recognized by the
Court in this case, in order for an agreement to exclude an
employee's common law notice, it must be clear and unambiguous.
Because section 3 of the Code preserves an employee's common
law rights, merely referring to the notice required under the Code
has, in other cases, not been considered sufficient to limit an
employee to the minimum notice requirements under the Code. Absent
a reference to the specific termination notice sections of the Code
(sections 56 and 57) or wording such as "the
minimum requirements under the Code",
some decisions have found that similarly-worded termination clauses
did not take away the employee's common law right to reasonable
notice, although each case needs to be decided on its individual
This case emphasizes the importance of careful drafting of
termination provisions, and shows that if done correctly, an
employer can significantly reduce its liability on a termination
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