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Employment - ESA - Interpretation. Wigdor v. Facebook Canada Ltd.
In Wigdor v. Facebook Canada Ltd. (Ont CA, 2026) the Ontario Court of Appeal partially allowed the employee's appeal (and dismissed the employers' cross-appeal), here where the appeal was brought against "the application judge’s order dismissing his claim for the value of Restricted Stock Units (“RSUs”) that would have vested during the common law notice period".
Here the court considers the 'time' which a contract should be assessed:[91] ... The legality and enforceability of terms in an employment contract must be assessed at the time the contract is entered into, not at the time of termination. The wording of the termination clause alone must be considered in deciding whether it complies with ESA minimum standards. What the employer actually did at the time of termination is irrelevant to whether the termination clause complies with the ESA: Wood, at paras. 28, 43-51; Waksdale v. Swegon North America Inc., 2020 ONCA 391, at para. 8. . Wigdor v. Facebook Canada Ltd.
In Wigdor v. Facebook Canada Ltd. (Ont CA, 2026) the Ontario Court of Appeal partially allowed the employee's appeal (and dismissed the employers' cross-appeal), here where the appeal was brought against "the application judge’s order dismissing his claim for the value of Restricted Stock Units (“RSUs”) that would have vested during the common law notice period".
Here the court considered whether the fact that a party negotiating of an employment contract had counsel bears on it's interpretation:[59] Further, the Respondents have provided no authority for the proposition that the fact that a party was represented by counsel is a relevant factual circumstance to be considered when interpreting an employment agreement. To the contrary, this court has cautioned against allowing considerations of an employee’s sophistication and access to independent advice to override the plain language in termination provisions: Rahman v. Cannon Design Architecture Inc., 2022 ONCA 451, at para. 24; see also Livshin v. The Clinic Network Canada Inc., 2021 ONSC 6796, 159 O.R. (3d) 430, at paras. 57 and 68.
[60] In Sattva, at para. 57, Rothstein J. cautioned against allowing the circumstances surrounding the formation of a contract to overwhelm the words of the agreement. At para. 58, he described the limits of surrounding circumstances relevant to interpretation of a contract as consisting “only of objective evidence of the background facts at the time of the execution of the contract, that is, knowledge that was or reasonably ought to have been within the knowledge of both parties at or before the date of contracting” (citations omitted). The fact that a party is represented by counsel does not fall within these limits.
[61] The Respondents’ argument seeks to rely on Dr. Wigdor’s receipt of legal advice when he entered into the contract to suggest that he is not entitled to the same clarity in an employment contract as an employee not represented by counsel at the time the contract is formed. I reject that proposition.
[62] For these reasons, I see no error in the application judge’s conclusion that the termination provisions of the employment agreement contravened the ESA, were thus unenforceable, and Dr. Wigdor was entitled to common law reasonable notice. . Wigdor v. Facebook Canada Ltd.
In Wigdor v. Facebook Canada Ltd. (Ont CA, 2026) the Ontario Court of Appeal partially allowed the employee's appeal (and dismissed the employers' cross-appeal), here where the appeal was brought against "the application judge’s order dismissing his claim for the value of Restricted Stock Units (“RSUs”) that would have vested during the common law notice period".
The court considered the interpretation of a termination clauses in an employment contract, here an issue of 'ambiguity':[56] If a termination clause is ambiguous, it must be interpreted in favour of the employee: Wood, at para. 28; Rossman, at para. 24 and 37. However, for genuine ambiguity to exist, there must be more than competing interpretations of the clause. The question of ambiguity is determined by an objective assessment of whether there are two or more reasonable interpretations of the clause: Bertsch, at para. 9; Amberber v. IBM Canada Ltd., 2018 ONCA 571, 424 D.L.R. (4th) 169, at para. 45; Rossman, at para. 24. . Stock Transportation Ltd. v. Llanos
In Stock Transportation Ltd. v. Llanos (Div Court, 2023) the Divisional Court considered the employee-generous statutory interpretation to be applied to the ESA:[25] The Court of Appeal relied on the principle in the Supreme Court of Canada decision of Machtinger v. HOJ Industries Ltd. 1992 CanLII 102 (SCC), [1992] 1 S.C.R. 986, that an interpretation of s. 13 (now s. 9) of the ESA that extended protection to as many employees as possible is to be favoured over an interpretation that does not, and that applying the “going concern test” would have the opposite result. (para 19). The Court further stated:[20] ... while the "going concern" test has been used by the Ontario Labour Relations Board in decisions dealing with the meaning of sale of a business under the OLRA, we are not persuaded that that means that it is appropriate that the same test should be used under the ESA. We note that "business" is not defined in the OLRA, whereas it is broadly defined in the ESA. More importantly, the two legislative regimes target different issues. As noted in Metropolitan Parking, the OLRA regime is aimed, at least in part, at providing for the continuity of relationships between unions and employers in the context of the sale of a business. By way of contrast, the purpose of the ESA regime is to protect individual rights and to preserve continuity of seniority. Viewed in this context, in our view, the meaning of business in s. 9 of the ESA is to be given an expansive interpretation.
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