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Employment Contracts

Every employee has a contract with their employer. What this means, is that a contract exists, whether it is a fully drafted agreement, with numerous headings and clauses, signed by the employer and employee; or whether it is based on the exchange of emails or correspondence (which makes it somewhat in writing); whether it is an oral discussion and a handshake; or whether it is just a statement saying “okay, come in and start on Monday.”


The point is that the contract starts with the understanding that the employee will provide time and service, and the employer will provide remuneration. That is an employment contract. Whether you know it or not, every employee in Ontario has an employment contract. 


Every contract, has to comply with the Employment Standards Act of Ontario.

If it does not comply, the employer is in jeopardy of having to pay what the Act and Regulations state what must be paid to the employee, but may also risk other penalties imposed on it for noncompliance.


However, an employee may have many more rights than those set out in the Employment Standards Act

The common law, will apply to an employment contract, unless the employee and employer have signed a written contract to the contrary.

What Employment Contracts Contain

A written contract can define and adjust what otherwise would be the fair and balanced interpretation of what would be imposed by the common law on the parties. The written contract can increase or decrease the common law provisions. Thus, an employment contract is a very significant document which, in a sense “changes everything.”


A Mississauga employment lawyer from DeRusha Law Firm can assist in the consideration and drafting, interpretation and negotiation with respect to an employment contract.


Some of the topics that are ordinarily considered in an employment contract include the following:

  1. Probationary Period – these usually state that the employer can terminate the employee during the probationary period without notice or cause, and without having to pay according to the common law, but only complying with the minimum notice period as set out in the employment standards legislation.

  2. Termination Clause – this may be an attempt to minimize the amount of notice or severance that an employee may be entitled to receive upon termination. If this clause was not present, setting out what is proper determination or severance pay for the employee, the common law would say that it must be “reasonable notice.” The types of factors that determine reasonable notice include, but are not limited to, the nature of the employment or position, the length of service, the age of the employee, the employee’s likely ability to find comparable employment, and may include factors as to how the employee was hired, that is, whether the employee was hired from a previous position or had to incur expenses to take the position.

  3. Fixed Term of Employment – these paragraphs, set out whether than the contract has an end date, and may specify the notice to which the employee might be entitled if there is early termination of the contract.

  4. Prohibited Employment or Activities of the Employee – these clauses may describe how the employee must devote all of their time to the job, and not take any alternative employment, or even to charitable work, without specific permission from the employer.

  5. Confidentiality Requirements – these clauses make it clear that the work done, or ideas created, is owned by the employer. It may also set out that there is liability on the employee if any of these obligations of confidentiality are breached.

  6. Non-competition Restrictions – these clauses limit the information and perhaps the future employment that an employee may take following termination. The “common law” looks carefully at such clauses to decide whether they are legitimate and reasonable, including in terms of duration, geographic scope, and the nature of the activities prohibited.

  7. Independent Legal Advice – sometimes a clause suggesting that the employee has either received independent legal advice or “waived independent legal advice.” If they sign a document is an attempt to be able to say to a court, that the employee had their chance to obtain legal advice before signing the agreement, so it should be strictly construed.

Helping You Understand Your Employment Law Rights

From the above legal clauses, it can be seen that the employment contract can be expansive or restrictive. Importantly, employment contracts are written by employement lawyers acting on behalf of a company or corporation. These employment lawyers seek to craft the most advantagous deal possible for the company or corporation. 


Further, you should keep in mind that any statement to a prospective employee that "... this is our Standard Employment Contract" is not a statement in which the prospective employee should take any comfort. What this phrase usually means is that, this is the employment contract that the employer wants the employee to agree to.  


Before you sign any employment contract, it is in your best interest to have a Mississauga employment lawyer review it. This is the only way to balance the drafting of the agreement is, if the prospective employee understand fully the agreement, the options, and its effects.


In the end, an employee gets what he or she negotiates. And, you may have more negotiating power than you think. 

Independent Legal Advice for Employment Contracts

What is needed by the prospective employee is a careful reading of the document, and an understanding of the various options in each area. To do this, the prospective employee should go through the document with a Mississauga employment lawyer.


A Mississauga employment lawyer from DeRusha Law Firm would not have the objective of avoiding the employment arrangement, but instead would be working with the prospective employee to determine what options and balance may be set out within the agreement. The prospect of changes can be prioritized, as part of a strategy that is worked out between the prospective employee and the Mississauga employment lawyer.


In the modern age of computers, employment contracts can be easily altered, to reflect a balanced and fair agreement. A Mississauga employment lawyer can assist, either in the background and prepare materials that are sent to the employer from the prospective employee, or negotiate directly. This depends on many factors, of course, the major factor being what the prospective employee wishes.


A no charge consultation can be arranged at DeRusha Law FIrm, so that the prospective employee understands their options and the process.

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