Minimum notice of resignation by employees

Question: We put a statement in our contracts indicating we will only pay minimum employment standards requirements for termination. Would that not then assume the employee, by accepting that term, would also have the implied right to provide only the same minimum notice? Even if this clause is not in older employment contracts, if the company has a history of only paying the minimum termination/severance, can it also allow employees to give the minimum notice of resignation?

Answer: In the absence of just cause for dismissal, the law requires an employer provide the employee with either notice of dismissal or pay in lieu thereof. There are a number of sources of this obligation. First, employment standards legislation will typically set out a minimum amount of notice that is to be provided, which generally varies based solely upon the length of service.

In addition, the courts have made it clear that there is a common law obligation to provide “reasonable notice,” which is over and above the statutory minimums. There are no black and white rules with respect to what will constitute reasonable notice in a particular situation. Rather, the courts have made it clear that each case is to be assessed based upon its own particular set of circumstances. The primary factors that are typically considered include:

•The employee’s length of service
•The employee’s age
•The employee’s position and character of employment
•The availability of similar employment.

There are dozens of other factors the courts have considered where appropriate. One of the more common ones is the issue of inducement.

Assessing common law notice periods is a complicated task and one that is fraught with uncertainty. The reality is that it is not an exact science; while one judge may assess a situation and consider three months’ notice to be appropriate, another might consider five months to be reasonable in the circumstances. There is a common myth that reasonable notice equates to one month for each year of service. Our courts have explicitly stated no such rule is to be applied, and the reality is the statistics do not bear such an assumption out.

While parties cannot contract out of the employment standards minimums, they are free to enter into an employment agreement that will set out the amount of notice to be provided in the event of dismissal without cause. So long as the contract is properly entered into, and the amount of notice does not go below the statutory minimums, the parties can contract out of the common law obligation of reasonable notice of dismissal. Employers who seek to rely upon such clauses should ensure the clause is clear and unambiguous.

With respect to the notion of a company history of only providing the statutory minimum amount of notice, I would not advise any employer to rely upon such history as constituting an agreement that would displace the common law obligation to provide a reasonable notice.

The obligation on an employee to provide notice of their resignation does not correspond proportionately to the obligation of an employer to provide notice of dismissal. Typically, the employee will be required to provide only a nominal amount of notice, which would be far less than they would be entitled to if she was dismissed. Parties should not assume the amount of notice of resignation required; if an employer is concerned about this issue, it should be explicitly stated.

The reality is that even if the employee provides less notice than required, it will be extremely difficult for an employer to bring a claim against her unless the employer can show it suffered actual damages as a result of the short notice.