How do I fire my employee without cause?
At the most basic level, when firing an employee without cause, an employer must provide the employee with notice of termination, or compensation in lieu of that notice. How much notice the employee is entitled to is determined by their employment contract, the Employment Standards Act, and the common law (Judge-made law).
If there is an (enforceable) employment contract with a termination clause in place, you must provide the employee with their entitlements under that termination clause. Many employment contracts attempt to limit the employee’s rights to the minimum rights provided under employment standards legislation – for example, providing employees with the minimum termination notice allowed under the Employment Standards Act. However, if there is no employment contract in place or the termination clause in the contract violates the ESA (making the contract unenforceable), the common law applies. There is no strict formula under the common law to determine how much notice an employee is entitled to, but some key factors such as age, length of service, character of employment, and availability of similar work are taken into account in order to estimate how long it would reasonably take the terminated employee to find their next job. These factors could mean that a terminated employee could be awarded one month per year of service or more, underscoring the importance of having an enforceable employment contract in place.