Reminder of an Employer's obligations in the event of the termination of a fixed term contract

May 22, 2012

In a recent decision, the Court of Quebec stated that, in the event employers dismiss employees who have fixed term employment contracts, they must pay the remainder of the term identified in the contract.

The Court concluded that even if the employee accepts a payment in lieu of notice, this does not imply that the employee has renounced to his right to claim amounts owed in accordance with his fixed-term contract, in a situation where no release was signed following such payment. As a result, the Court stated that an employee on a fixed-term contract has the right to receive compensation equal to the total amount of income provided for in the contract up to its expiry date.

The Court also concluded that although an employee has the right to obtain payment of the balance of sums due under the employment contract, he has an obligation to mitigate his damages by making a reasonable effort to find alternative employment.

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