Ontario Court of Appeal Upholds 'At Any Time' Termination Clauses: What Baker v. Van Dolder Means for Your Severance

On August 6, 2026, the Court of Appeal for Ontario released Baker v. Van Dolder's Home Team Inc., 2026 ONCA 568, deciding two appeals together (Baker v. Van Dolder and Li v. Wayfair Canada ULC). A unanimous panel held that a without-cause termination clause is not automatically void just because it lets the employer end the job "at any time" or "for any reason." For most non-union workers in Ontario, that one paragraph of the employment contract decides whether a dismissal is worth a few weeks of pay — or many months.

The stakes: ESA minimums vs. reasonable notice

• If your contract contains an enforceable termination clause, your

employer can usually limit you to the minimums in the Employment Standards Act, 2000 (ESA) — generally one week of notice or pay per year of service, to a maximum of eight weeks, plus severance pay where it applies.

• If the clause is void, the common-law presumption of **reasonable

notice** revives — often months of pay, depending on age, length of service, the role, and the job market.

That gap explains why so much litigation attacks clause wording. After Dufault v. Township of Ignace (2024 ONSC 1029), several Superior Court decisions held that "at any time" wording was itself inconsistent with the ESA, which forbids dismissals at certain times (such as at the end of a statutory leave) or for certain reasons (such as reprisal for asserting ESA rights). Many employees relied on that reasoning to strike down their clauses.

What happened in the two cases

• Mr. Baker, 71, was Van Dolder's controller for about two and a half

years before a without-cause dismissal in March 2023. His ESA entitlement was two weeks; he declined four weeks offered in exchange for a release and sued, arguing "at any time" voided his clause. The motion judge agreed.

• Mr. Li, a senior product manager at Wayfair Canada, was dismissed

without cause after less than a year and received the ESA minimum of one week. His clause said "at any time and for any reason" — and a different judge upheld it.

Nearly identical wording, opposite results. The Court of Appeal used the two appeals to reset the approach.

What the Court decided

1. Read the contract as a whole. Courts must look for the parties'

objective intention in the entire agreement and its surrounding circumstances — not scrutinize words in isolation or strain to find ambiguity. There are no fatal "magic words."

1. "At any time" is about timing, not law-breaking. In context, it means a

without-cause termination is effective whenever it occurs. It is not a licence to dismiss someone in circumstances the ESA expressly prohibits.

1. "For any reason" means no reason needs to be given — provided the

employee still receives every statutory entitlement. It does not signal an intention to fire for a reason the law forbids.

1. A broad "cause" definition can survive if the clause preserves ESA

minimums. Mr. Baker's contract said that even a for-cause dismissal would still pay whatever the ESA requires, and a separate clause promised ESA compliance "at all times." That saved it.

1. ***Waksdale still stands.* If any termination provision in the contract

does breach the ESA, all of them remain unenforceable. The court declined to revisit that rule.

The result: both clauses were upheld, and both employees were limited to their ESA minimums.

If you are an employee

• Don't assume your clause is void — or bulletproof. Baker closes the

"at any time" shortcut, but clauses still fail when they shortchange ESA minimums in any scenario, and many older contracts do.

• Your statutory protections remain. An employer still cannot dismiss

you as a reprisal, contrary to leave protections, or for discriminatory reasons under the Human Rights Code.

• The time to negotiate is before you sign. A compliant clause will now

more readily be enforced exactly as written.

• Have any severance offer reviewed before signing a release. Whether

your clause actually complies with the ESA is a technical question, and it determines whether the offer is fair. Smaller claims may also fit within Small Claims Court's $50,000 limit.

If you are an employer

Careful drafting is rewarded: repeated references to ESA entitlements and a "minimum standards" savings clause carried the day here. But because Waksdale survives, one defective provision — often the with-cause paragraph — can still bring down the entire scheme, so contracts drafted before 2026 deserve a fresh look.

The bottom line

Baker v. Van Dolder is the Court of Appeal's clearest word in years on termination clauses: context beats word-hunting, and well-drafted clauses that keep every ESA minimum will hold. If you have been let go, or you are staring at a new contract and are unsure what its termination clause really costs you, JSR Immigration & Legals is happy to walk through it with you — reach out at info@jsrimmigration.com or (647) 286-4266.

This article is general information about Ontario employment law, not legal advice. It summarizes a publicly reported decision as of August 16, 2026; every situation turns on its own facts and contract wording. Read the full reasons on CanLII and confirm your entitlements with a licensed lawyer or paralegal.