10 Mistakes Employers Make When Firing You (and How Each One Increases Your Severance)

Most checklists about how to terminate employees are written for HR departments, to protect the employer. This is the same list read from the other side. Every item below is a mistake Ontario employers make constantly, and every one of them makes the terminated employee's claim stronger. If even one applies to you, the number in your termination letter is probably not the number you should accept.

Mistake 1: Is the termination clause in your contract even enforceable?

In Waksdale v Swegon North America (2020, Ontario Court of Appeal), the court held that if any part of a contract's termination provisions violates the Employment Standards Act, the entire termination scheme is void, including the without-cause clause the employer is actually relying on. Employers keep recycling old templates, so a large share of Ontario termination clauses fail this test.

The payoff is dramatic. A valid clause can limit you to ESA minimums, which cap notice at 8 weeks under section 57. A void clause entitles you to common law reasonable notice under the Bardal factors (age, length of service, character of employment, and availability of similar work), which is routinely measured in months and can reach 24 months for long-service employees. Keep every version of your contract and anything that changed your terms, and see our guide to the signs a termination clause is unenforceable.

Mistake 2: Did they allege cause without real grounds?

Just cause is the hardest allegation in employment law to prove, and employers regularly plead it to scare people out of severance. Even where a court accepts just cause, you can still be owed your ESA termination and severance pay unless the employer proves wilful misconduct under Ontario Regulation 288/01, which is a higher standard again.

A cause allegation made without solid grounds can backfire badly. Courts treat unproven cause allegations, especially ones maintained as a bargaining chip, as evidence of bad faith that supports extra damages. Preserve your performance reviews, commendations, raises, and the exact wording of the termination letter.

Mistake 3: Were you fired during or right after a protected leave?

Ontario's job-protected leaves (pregnancy, parental, sick leave, family caregiver leave and others) come with a right to reinstatement and an anti-reprisal rule in the ESA. In a reprisal complaint the onus flips: the employer has to prove the leave played no part in the decision. The Human Rights Code adds a parallel claim where the termination is connected to pregnancy, disability, or family status, with damages for injury to dignity on top of your notice entitlements. Keep your leave approvals, medical notes, and a dated timeline of who said what.

Mistake 4: Was it a mass termination they handled badly?

If 50 or more employees are terminated at one establishment within a four-week period, the mass-termination rules in section 58 of the ESA apply. Statutory notice jumps to 8 weeks (50 to 199 employees), 12 weeks (200 to 499), or 16 weeks (500 or more), and the employer must file a Form 1 with the Ministry of Labour. Notice does not legally start running until that form is filed, so a botched filing can mean the clock never started. Note how many colleagues lost their jobs and on what dates; that detail alone can add weeks of pay, and it never displaces your separate common law claim.

Mistake 5: Did they cut off your bonus or commissions at the termination date?

In Matthews v Ocean Nutrition Canada (2020, Supreme Court of Canada), the court confirmed that wrongful dismissal damages include the bonuses and incentives you would have earned during your notice period, unless the plan language unambiguously removes that right. Clauses requiring you to be actively employed on the payout date usually fail. If your package is silent on your bonus, commissions, RSUs, or benefits over the notice period, it is undervaluing your claim. Keep the plan documents and your payout history.

Mistake 6: Did they pressure you to sign the release fast?

A 24 or 48 hour deadline to sign a release is a pressure tactic, not a legal requirement. Your ESA minimums are owed whether or not you sign anything, so the only thing the deadline protects is a lowball offer. A release signed under that kind of pressure, without independent advice and for little more than the statutory minimum, is also easier to attack later. Save the letter and every message about the deadline.

Mistake 7: Were you treated badly in the way they fired you?

In Honda Canada v Keays (2008, Supreme Court of Canada), building on the earlier Wallace decision, the court held that employers owe good faith in the manner of dismissal. Conduct that is untruthful, misleading, or unduly insensitive supports moral damages on top of your notice period. Think false accusations, a security escort past your colleagues, lying about the reason for the termination, or cutting off benefits in the middle of treatment. Write down exactly what happened at the termination meeting while it is fresh, and read our deep dive on bad faith dismissal damages.

Mistake 8: Did they hold back your ESA money until you sign?

Your ESA termination pay under section 61 is due within 7 days of termination or on your next regular pay day, whichever is later, and it cannot be made conditional on signing a release. The same goes for statutory severance pay under section 64, which adds roughly one week per year of service up to 26 weeks where you have 5 or more years of service and the employer's payroll is at least 2.5 million dollars. An employer that holds your statutory money hostage is breaking the ESA and handing you evidence of bad faith at the same time.

Mistake 9: Did they lowball you with a weeks-per-year formula?

There is no formula in Ontario common law. One week per year is not the rule, and neither is two. Courts weigh the Bardal factors, and older, longer-service, and more specialized employees routinely receive far more than any formula produces. If your letter offers a tidy weeks-per-year number, it was almost certainly generated to protect a budget, not to reflect your entitlement. See how much severance you can actually get in Ontario.

Mistake 10: Did they put you on temporary layoff or play games with working notice?

Unless your contract clearly allows temporary layoffs, putting you on layoff is generally a constructive dismissal at common law, which triggers your full severance entitlements. The same logic applies to games during working notice: stripping your duties, cutting your pay, or making the job intolerable so you quit first. Do not resign in response; get advice before you react, because resigning can cost you leverage and entitlements.

How can you tell if your termination was mishandled?

Run your situation against this list. Each yes is leverage.

• Your contract is from an old template, or its termination language mentions being fired for cause without notice
• You were accused of cause but never given specifics or a chance to respond
• You were on, returning from, or had just requested a protected leave
• 50 or more colleagues were let go around the same time
• The offer says nothing about your bonus, commissions, or benefits during the notice period
• You were given a short deadline to sign the release
• You were walked out, publicly accused, or misled about the reason
• Your ESA pay has not arrived, or the letter makes it conditional on signing
• The offer is a neat one or two weeks per year of service
• You were placed on temporary layoff instead of being formally terminated

What should you do before you respond to the offer?

1. 1.Do not sign the release or respond to the offer yet; deadlines can almost always be extended.
2. 2.Gather your documents: every employment contract you signed, the termination letter, bonus and commission plans, recent pay stubs, and your last T4.
3. 3.Write a dated timeline of the termination while it is fresh, including who was present and what was said.
4. 4.Count how many of the ten mistakes above apply to you; each one changes the value of your claim.
5. 5.Get the offer reviewed by an employment lawyer before you agree to anything; a review usually takes days and often pays for itself many times over.

Employer mistakes are the raw material of a strong severance claim, but they only help you if you spot them before you sign. Start with our full guide to severance pay in Ontario, and if you have a termination letter in hand, our severance pay review will tell you what your package should really look like.

About the Author

Daniel Carter

Legal Writer, Mirza Law

Daniel Carter is a legal writer at Mirza Law in Toronto. He writes about layoffs, employment contracts, and the steps to take before you sign anything from your employer.

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