Supreme Court of Canada’s latest word on bonus entitlements on termination

This case may not apply to every employer, but if you are one that pays bonuses and has long term incentive programs, it may. We’ve seen many of these cases find for one party and then be overturned so the Supreme Court having the final word sets it in stone (sort of).

this is where you want to really be sure that your Employment contracts are well written, your incentive programs crystal clear and terminations get vetted by employment lawyers when dealing with longer term employees, higher earning levels and anything but the most basic types of income.

The Supreme Court of Canada recently released its decision in Matthews v. Ocean Nutrition Canada Ltd.[1] This highly anticipated decision dealt with the entitlement to bonuses and long-term incentive plan amounts in assessing wrongful dismissal damages. The Court concluded that such language will only be effective where the contract language clearly and unambiguously limits or removes the employee’s right to damages based on the loss of those entitlements.