Wrongful dismissal is one of the most common issues we face as employment lawyers. This blog looks deeper into the employment law issue of wrongful dismissal. Specifically, we investigate what wrongful dismissal is, what is the difference between termination without cause, termination with cause and constructive dismissal. Finally, we discuss what should an employee do if they think they have been wrongfully dismissed in Ontario.

What is Wrongful Dismissal?

Wrongful dismissal occurs when an employee is fired by their employer without cause, and the employer has refused or failed to provide the employee with reasonable notice of termination or pay in lieu of notice of termination or a combination of both upon dismissal.

Specifically, wrongful dismissal means that the employee has been fired or terminated in the following situations:

1. where an employer terminated the employment of the employee and improperly alleges cause, while failing to provide the employee with reasonable notice of termination; and
2. where an employer has terminated the employment of the employee without cause and has refused or failed to provide the employee with reasonable notice of termination.

When an employee is terminated without cause, the employee is owed notice of the upcoming termination or pay in lieu of that notice, or a combination of both. Termination pay is simply monetary compensation to the employee in lieu of notice of the termination. Sometimes the employer will provide no notice to the employee or less notice than what the employee should have received from the employer. We have more information about termination pay and notice of termination located on our website. For example, Termination Pay in Ontario: 2026 Guide to Rights & Entitlements and Our Guide to Notice of Termination under Ontario’s Employment Standards Act, 2000.

Termination Without Cause vs. Termination with Cause vs. Constructive Dismissal

Termination without cause means an employee was dismissed from their employment by their employer and there are no allegations of wrongdoing or misconduct on the part of the employee by the employer. As such, they are owed proper notice of termination. For example, a common reason for termination without cause would be instances where the employer has decided to restructure their business or downsize their operations thereby eliminating the employee’s employment position. There are implied terms in employment contracts or employment agreements that protect the employee against wrongful dismissal by requiring proper notice, payment, or a combination thereof, by the employer. The employer must also not dismiss the employee in a discriminatory or retaliatory manner. For more information about termination without cause, please review our blog entitled 3 Key Things to Know About Termination Without Cause in Ontario.

In comparison, termination for cause occurs when the employer dismisses an employee without providing notice of termination, because the employer has alleged that there is “cause” for the termination. As such, the employee does not receive termination pay or severance pay. In Ontario, the bar in cause cases is high and the onus to prove it is on the employer. Ontario courts use a contextual framework where for cause termination is at issue. For more information about termination for cause, please visit our blogs entitled Fired for Cause in Ontario? Just Cause vs. Willful Misconduct and Progressive Discipline in Ontario Workplaces.

However, constructive dismissal occurs when the employee’s fundamental terms of employment are changed unilaterally by the employer, if the employer evinces an intention to not be bound by fundamental terms or if the employee is subjected to some sort of illegal act such as harassment or a toxic work environment. In such instances, the employee is forced to leave their job without being directly fired or terminated by the employer. How the employee leaves the workplace is not crucial to the analysis of what is a constructive dismissal. What is crucial is that the employee’s employment will usually be impacted to the point where it would be unreasonable to stay or to accept the fundamental changes in their employment. For more information about constructive dismissal, please visit our blog entitled What Is Constructive Dismissal? A Guide for Employees.

What Should an Employee Do If They Think They Have Been Wrongfully Dismissed?

Here are some basic steps that most employees take when they believe they have been wrongfully dismissed from their job:

1. Do not sign or agree to any termination package or terms in a termination letter right away (even if there is a “deadline” to agree to those terms).
2. They should obtain their important documents so that they have those on hand. Examples of these types of documents would be the employment agreement or employment contract and the termination letter or severance package if there is one.
3. Approach an employment lawyer for a consultation with respect to the potential wrongful dismissal matter. This should give the employee a better understanding of what entitlements may be owed and what other steps they should take. For more information about the consultation process, please see our blog entitled What to Expect in a Legal Consultation with an Employment Lawyer.
4. Once the employee understands their legal rights and possibilities of compensation, they may move forward with legal action, if necessary.

For more information about what to do if an employee think they have been wrongfully dismissed:

• 4 Practical Steps to Take When You Receive a Termination Letter from Your Employer
• When Should an Employee Hire an Employment Lawyer?

How Can Zeilikman Law Help?

Where an employee has experienced wrongful dismissal, they should contact an employment lawyer to discuss their options. They should not attempt to negotiate with their employer without a lawyer’s assistance given the possible legal complexities of matter at hand. Likewise, if an employer wants to dismiss an employee, they should also contact an employment lawyer so that the lawyer can assess their situation and minimize their risk of litigation.

If our readers would like additional information about wrongful dismissal, we have several other blogs that they may want to review:

• What is working notice?
• What You Should Know About Wrongful Dismissal in Ontario
• Wrongful Dismissal in Ontario

Zeilikman Law can be contacted at (905) 417-2227 or online here to schedule your own confidential consultation with one of our employment lawyers.