Court of Appeal Confirms: “At Any Time” or “For Any Reason” Do Not Automatically Invalidate Termination Clauses

Bottom Line

In a highly anticipated decision released on August 6, 2026, the Ontario Court of Appeal has clarified that commonly used termination clause language - including "at any time" and "for any reason" - does not automatically render a termination provision unenforceable for inconsistency with the Employment Standards Act, 2000 (the "ESA").

The decision resolves contradictory rulings in Ontario's lower courts and provides much-needed predictability for employers when drafting their employment agreements.

What the Court Decided (in a nutshell)

"At Any Time"

The Court rejected the literal, isolated reading of the phrase "at any time" as purporting to authorize termination even when the ESA prohibits it (e.g., as a reprisal or during a protected leave). Instead, the Court interpreted the words "at any time" simply to mean that the employer need not wait for a particular contractual milestone or event, and not to mean that the employer can override statutory protections.

"For Any Reason"

The Court likewise held that the phrase "for any reason" or analogous phrases (with the Court providing the example of "at its sole discretion") simply confirm that an employer exercising a without-cause termination need not justify its decision, but do not exempt the employer from ESA prohibitions.

What This Means for Employers

• Reduced litigation risk. Commonly used phrases like "at any time" or "for any reason," will no longer serve as standalone grounds for attacking a termination clause, provided the rest of the provision clearly expresses ESA compliance.
• Current Litigation. This decision will materially affect employers' positions in ongoing litigation where the contract language is a significant (or the only) issue in dispute.
• No "magic words" either way. The Court cautioned against a "legalistic 'magic words' approach" in either direction: certain words will not automatically doom a clause, but nor do they guarantee enforceability in the absence of supporting compliance language.
• Not a free pass. The decision does not mean employers can terminate in circumstances actually prohibited by statute. The ESA's reprisal, protected-leave, and other prohibitions remain fully operational and enforceable.

Key Takeaway

This decision is a welcome development for Ontario employers. The Court of Appeal has confirmed that phrases like "at any time" and "for any reason" are not inherently fatal to termination clauses. These are ordinary commercial expressions confirming the employer's right to terminate at its election - read in context, they do not purport to override the ESA. However, the decision also reinforces that enforceability turns on the overall drafting: a termination clause must be clear and should expressly set out an intention to comply with statutory minimums.

We recommend that employers review their template employment agreements to confirm that termination clauses contain robust ESA compliance language consistent with the principles endorsed in this decision.

For more information, please contact any member of our Labour & Employment Group.