Court Of Appeal Serves Reminder That Contractors May Be Entitled To Reasonable Notice

Cormier v. 1772887 Ontario Limited c.o.b. as St. Joseph Communications1 - a recent decision from Ontario's Court of Appeal - is an important reminder that contractors may be entitled to reasonable notice upon termination without cause. The Court of Appeal's decision also underscores the importance of careful drafting when it comes to termination clauses in employment contracts.

Background

Between 1994 and 2004, Ms. Cormier worked for St. Joseph Communications ("SJC") as a contractor. During this time, Ms. Cormier worked exclusively for SJC (approximately 37 to 40 hours per week) for 10 months of the year. SJC dictated Ms. Cormier's work assignments and provided her with the tools needed to perform the job. Ms. Cormier was compensated primarily on an hourly basis, and she invoiced SJC as if she was a sole proprietor. SJC did not withhold any amounts for taxes, nor did it provide Ms. Cormier with any employment-related benefits.

In June 2004, Ms. Cormier ceased being a contractor when she entered into a written employment contract with SJC. She started receiving an annual salary and later enrolled in SJC's benefits plan. However, Ms. Cormier's employment was terminated without cause in 2017 due to the liquidation of one of SJC's major clients.

Ms. Cormier then sued SJC for wrongful dismissal, claiming that she was entitled to reasonable notice based on 23 years of service dating...