CCEOS INSISTING ON RIGID RETURN-TO-OFFICE MANDATES WITHOUT CONTRACTUAL
AUTHORITY ARE INVITING CONSTRUCTIVE DISMISSAL CLAIMS. COURTS WILL NOT RESCUE
EMPLOYERS FROM THEIR OWN GENEROSITY. — HOWARD LEVITT
anadian employers entering 2026 face an uncomfortable reality: employment law is no longer
forgiving, flexible or neutral.
Courts have made it clear that businesses that treat employment obligations as technicalities —
or worse, inconveniences — will pay dearly for the miscalculation.
Survival in 2026 will not come from clever tactics. It will come from discipline.
1. Fix your contracts — or stop pretending you have them
If your employment agreements predate the past year, assume they are defective. Termination
clauses are being struck down with remarkable consistency, often for minor drafting flaws.
Overreaching, confusing or overly technical language, internal inconsistencies or attempts to
limit statutory rights are fatal. CEOS who believe a “standard form” protects them are gambling
corporate money on wishful thinking.
The safest contract in 2026 will not be the most aggressive one. It will be the clearest, most conservative and most current.
2. Treat termination as a legal event, not an HR task
Executives routinely delegate dismissals to HR or middle management with minimal oversight.
This is a mistake courts punish. The manner of dismissal now matters almost as much as the
amount paid. Abrupt meetings, careless language, delayed compensation and poor timing —
holidays, medical leaves, complaint periods — invite aggravated damages.
Every termination should be planned, scripted and executed as if a judge was watching —
because it is likely one will be.
3. Stop clawing back flexibility you already gave
Remote and hybrid work are no longer perks. In many organizations, they have become implied
terms of employment. CEOS insisting on rigid return-to-office mandates without contractual
authority are inviting constructive dismissal claims. Courts will not rescue employers from their
own generosity.
If flexibility must change, negotiate it. Do not impose it.
4. Assume layoffs are terminations unless proven otherwise
Temporary layoffs remain a legal minefield. Without explicit contractual authority, they almost
invariably amount to wrongful dismissal, regardless of economic conditions or good intentions.
In 2026, courts will continue to reject “everyone does it” as a legal defence.
Seven survival tips for employers
National Post · 7 Jan 2026 · Howard Levitt
If you do not have the right to lay off, you do not have the right to experiment.
5. Re-examine every independent contractor relationship
If your business depends on contractors, assume that most of them, if not all, are employees.
Courts will continue to focus on control, dependency and economic reality, not on labels. Companies that ignore this risk will face retroactive liability for termination pay, overtime pay, vacation pay and statutory benefits.
This is not a theoretical risk. It is already happening.
6. Document decisions as if they will be litigated, because they may well be
Courts are increasingly skeptical of vague claims of “restructuring” or “business necessity.” In
2026, undocumented decisions will be treated as suspect. CEOS must insist on written
rationales, consistent messaging and defensible processes.
Good intentions without evidence are worthless in court.
7. Abandon the idea that any sympathy belongs to employers
Courts have chosen their audience, and it is not the boardroom.
Employees are viewed as vulnerable; employers as powerful. Companies that fail to internalize
this will continue to be blindsided by outcomes they consider unfair but are entirely predictable.
Surviving 2026 requires a mindset shift. The question is no longer what employers can get away
with. It is what courts expect, and what they are prepared to punish.
Those who adapt will manage their risk. Those who do not will keep financing the evolution of
employment law, one adverse decision at a time.
Howard Levitt is senior partner of Levitt LLP, employment
and labour lawyers with offices in Ontario, Alberta and British Columbia. He practises
employment law in eight provinces and is the author of six books, including The Law
of Dismissal in Canada.