A recent judgement upheld by the Ontario Court of Appeal has sent ripples through boardrooms and breakrooms alike in early 2025, forcing both employers and employees to take a closer look at their rights and responsibilities under Ontario employment law. The case of Karen Dufault–a fixed-term contract gone wrong–has brought to light the risks of poorly drafted agreements and the protections available for workers.
At the forefront of this landmark case are Lior Samfiru and Jon Pinkus, leading employment lawyers whose advocacy turned a routine severance dispute into a precedent-setting ruling.
The costly case that changed the conversation
Dufault signed a two-year fixed-term contract for youth engagement coordinator position with the Township of Ignace in November 2022. Fixed-term contracts, which set defined start and end dates, are commonly used for temporary or project-based roles but come with unique risks if not carefully drafted.
What started as a promising role for Dufault quickly became untenable. Her responsibilities were reassigned without notice, her role was marginalized, and workplace tensions made it impossible for her to continue. On her doctor’s advice, Dufault took a medical leave. When she returned in January 2023, her office was moved, her company phone was gone, and her duties had been reduced to a bare minimum. Three days later, she was terminated without cause.
Refusing to accept this treatment, Dufault sought legal help from Samfiru Tumarkin LLP. The courts determined that the Township’s termination clause violated the province’s Employment Standards Act (ESA), rendering it unenforceable. Without a valid clause, Ignace was required to pay out the full value of her contract–$157,000 for only two months of work.
What employers can’t ignore
Dufault’s case highlights a critical risk for employers: fixed-term contracts must comply with the ESA. Poorly worded or non-compliant clauses can leave businesses exposed to significant financial liability.
“Fixed-term contracts are not just agreements; they’re commitments. Get them wrong, and they’ll turn into six-figure lessons you never wanted to learn,” explained Samfiru, co-founding partner of Samfiru Tumarkin LLP and host of the Employment Law Show in Ottawa and across Canada.
This isn’t the first time Samfiru Tumarkin LLP has exposed vulnerabilities in employment agreements.
- In one case, the firm secured nearly $50,000 for a sales employee at Bausch & Lomb Canada after their fixed-term contract was improperly terminated.
- In another, a long-term project manager in the tech field was awarded eight months’ pay when their employer’s termination clause failed to address benefits properly.
Employers can learn several key lessons from cases like these:
- Termination clauses must comply with the ESA: Any clause violating minimum employment standards holds no legal weight.
- Poor drafting can lead to full payouts: Without a valid termination clause, employers may owe employees the entire remaining value of their contract.
- Prevention is key: Investing in professional legal advice when drafting contracts can save significant time and money down the road.
What employees should take away
For non-unionized employees, Dufault’s story underscores the importance of knowing your rights. Many workers assume their contracts leave them powerless, but Ontario law often provides more protection than they realize.
“Too often, employees feel stuck–afraid to challenge their employer’s actions because they think they have no leverage,” said Pinkus, Partner at Samfiru Tumarkin LLP. “This case proves otherwise. Standing up for yourself can lead to meaningful results.”
Key takeaways for employees:
- Don’t assume a contract is bulletproof: Contracts that seem ironclad may contain flaws that work in your favour.
- Seek legal advice after termination: If you’ve been let go, consult a lawyer to understand your rights to severance pay before signing any
- Stand up for your rights: Most employment issues can be resolved quickly without going to court.
Balancing compliance and rights: Why this case matters
Dufault’s $157,000 victory is more than a headline—it’s a case study in how employment law works to protect both sides of the employment relationship.
For employers, it’s a stark reminder of the importance of carefully crafted contracts. For employees, it’s proof that standing up for your rights can lead to justice and compensation.
“This case isn’t just about one person–it’s about the bigger picture,” said Samfiru. “When contracts are drafted fairly and the law is followed, everyone benefits. This isn’t just legal housekeeping; it’s how we ensure workplaces operate with fairness and respect.”
Samfiru Tumarkin LLP continues to challenge employers and advocate for fairness. The firm is also leading a $400 million class-action lawsuit against Uber, alleging misclassification of drivers and delivery workers as independent contractors rather than employees.
“Employment law is evolving every day,” said Samfiru. “Our role is to help employees and employers navigate this complex landscape, ensuring rights are protected and responsibilities are upheld. That’s the standard we’re committed to.”
Facing an employment issue or denied long-term disability claim? Contact Samfiru Tumarkin LLP for expert advice and practical solutions. With offices in Ottawa, Toronto, Calgary and Vancouver, Lior Samfiru and his team have won millions of dollars for thousands of clients since 2007. Discover why Samfiru Tumarkin LLP is Canada’s most reviewed law firm on Google—connect with us today.
