Legal Distinctions and Implications of Termination With Cause vs. Without Cause


Understanding the distinction between being terminated with cause and without cause is crucial for employees, as it significantly impacts their rights and entitlements upon dismissal. This knowledge is especially important in safeguarding the interests of employees and ensuring fair treatment under the law.

Definitions and Legal Framework

Termination With Cause:

  • Termination with cause (or “for cause” or “just cause”) occurs when an employee is dismissed from their job due to serious misconduct or failure to meet performance standards. Legally, this means the employer has a substantial reason justified by the employee’s behavior or performance that breaches the employment contract. The bar to prove just cause in Ontario is incredibly high, and most terminations for cause do not meet the legal test for a with cause termination. A with cause termination allows the employer to avoid its obligation to pay the employee pay in lieu of reasonable notice of the termination of employment. Importantly, it does not relieve the employer of its obligations to provide notice and severance under the Ontario Employment Standards
    Act (ESA).

Termination Without Cause:

  • Termination without cause happens when an employee is dismissed without any fault on their part. This can be due to several reasons including company restructuring, position elimination, or other business-related reasons that do not relate to the employee’s conduct or performance. While many employees feel a termination is unfair, unfortunately employers in Ontario have the right to terminate employees without cause, for any lawful reason. Unlawful reasons could include a termination for discriminatory reasons or a termination during a protected leave of absence.

Legal Recourse and Rights – Challenging For-Cause Termination:

  • If terminated for cause, employees should consult with a lawyer and request an enhanced severance package and consider commencing legal proceedings to dispute the validity of the termination for cause.

Negotiating Terms in Without-Cause Termination:

  • Employees terminated without cause can often negotiate their severance packages. Employers will often try to offer less than the employee’s full legal entitlement in the hopes that the employee will not seek legal representation to negotiate the package


The distinction between being terminated with cause and without cause has profound implications on an employee’s rights. Understanding these differences is crucial in ensuring that employees are treated fairly and can effectively plan their next steps.


Always review the terms of your employment contract and seek legal advice if you face termination. At Workplace Sage Legal, we are dedicated to guiding our clients through these challenging times with professional advice and compassionate support, ensuring their rights are fully protected.

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