Lesson 4: Employment Law
Lesson 4 examines the principles of employment law under the Civil Code of Quebec (CCQ) and the Labor
Standards Act (LSA). Topics include the formation and duties of an employment contract, non-competition
clauses, the rules for terminating employment under both the CCQ and the LSA, whistleblowing, workplace
behaviour and privacy, employer liability for employee-caused damages, the distinction between an employee
and an independent contractor, and psychological harassment under the LSA.
⭐ 4.0 Introduction
Most people will, in their lifetime, be either an employer or an employee, making Employment Law a very
important area of law. This lesson looks at the employee's duties to the employer, the employer's rights to
terminate an employee, and the employer's obligation to prevent psychological harassment at work.
KEY FRAMEWORK ⭐
When analyzing a court case, remember: the names of the parties, the facts of the case, the legal
issue, the position of each party, and the final court judgment.
⭐ 4.1 Introduction to Employment Law
KEY DEFINITION ⭐
Under CCQ 2085, an employment contract is a contract where a person (the employee) undertakes
for a limited period to do work for remuneration (payment), according to the instructions and
under the direction/control of another person (the employer). This course covers individual
contracts of employment only — not unions or collective agreements.
Subordination is the legal term describing the fact that employees are required to do what their
employer tells them to do.
Fixed or Indeterminate Term (CCQ 2086) ⭐
Type Description
Fixed term Hired for a period of time with a finite, defined ending date (e.g., a 6-
month contract starting today).
Indeterminate term No ending date is discussed in the contract — the contract could last
months or years, with no defined end.
Duty of Employer (CCQ 2087)
KEY DEFINITION ⭐
The employer has a general obligation to provide the employee with a physically and morally safe
working environment — clean, properly heated/air conditioned, properly lit, and safe from physical
and emotional intimidation.
,Duty of Employee: Fiduciary Duty (CCQ 2088) ⭐
KEY DEFINITION ⭐
The employee has a duty to act in the best interest of the employer: to carry out work with
prudence and diligence, to act faithfully and honestly, and not to use any confidential information
obtained in the course of the work.
Confidential information covers all information relating to the employer's business — client lists, pricing,
intellectual property (patents, trademarks, copyrighted material), financial information, etc. It also covers all
information the employee creates as part of the job — even though the employee created it, it belongs to the
employer.
• ⭐ When an employee leaves a job, they cannot take any confidential information with them without the
employer's prior consent — including information they themselves created on the job.
⭐ 4.2 Non-competition Clause
KEY DEFINITION ⭐
Under CCQ 2089, the parties may stipulate in writing and in express terms that, even after
termination of the contract, the employee may neither compete with the employer nor participate
in any capacity in a competing enterprise. Non-competition clauses are not implied — they must be
expressly written in the signed employment contract, or they do not exist.
Three Elements of a Valid Non-competition Clause ⭐
The non-competition clause must be limited to what is necessary to protect the employer's legitimate interests,
in three respects:
• Time: a defined period during which the employee cannot compete.
• Place: a defined geographical area.
• Type of employment: the specific type of job the employee is not allowed to do.
KEY CONCEPT ⭐
Reverse burden of proof: the burden of proving that a non-competition clause is valid is on the
employer — the employer must prove both that the employee breached the contract (is competing)
and that the clause itself (time, place, and type of employment) is reasonable in scope. This is a
difficult proof to make, and Quebec courts rarely enforce a non-competition clause against a regular
employee.
Contracts of Adhesion ⭐
Employment contracts are often contracts of adhesion — contracts where one party (the employer) has all the
bargaining power and the other (the employee) has none; the employee will effectively sign just about anything
to get a job, and the courts are aware of this.
CCQ 2095: if the employee was not fired for a serious reason (CCQ 2094), the courts will not even let the
employer attempt to plead the validity of a non-competition clause — a further indication of how much Quebec
courts dislike enforcing non-competition clauses in regular employment contracts.
, Non-competition: Employment Contracts vs. Sale of a Business ⭐
Aspect Regular Employment Contract Sale of a Business
Bargaining power Unequal — employer imposes terms, Generally equal — willing buyer and
employee has no real power to willing seller, negotiated
negotiate (take it or leave it)
What is being N/A — employee provides labour The buyer pays for
purchased/protected goodwill/intangibles (reputation,
customer lists) in addition to
physical assets
Court's willingness to Very reluctant — rarely enforced Courts are prepared to enforce a
enforce a non- against a regular employee reasonable non-competition clause
competition clause
EXAM EXAMPLE
A buyer purchases a business, paying for its goodwill, reputation, and customer list. If the seller
could simply open a new, competing business across the street and say “I welcome all my old
customers,” the buyer would be unfairly deprived of the value they paid for. In this context (unlike a
regular employment contract), the courts would be prepared to enforce a reasonable non-
competition clause.
⭐ 4.3 Termination Under the CCQ
Reasonable Notice (CCQ 2091) ⭐
KEY DEFINITION ⭐
Either party may terminate an employment contract for an indeterminate term by giving
reasonable notice to the other party. Reasonable notice must take into account the nature of the
employment, the specific circumstances (e.g., did the employer induce the employee to quit a prior
job to come work for them), and the duration of the period of work — generally, the longer the
employee has worked for the company, the longer the notice period should be.
Notice for Indeterminate vs. Fixed Terms ⭐
• Indeterminate term: the employee can be fired at any time, as long as reasonable prior notice is given (an
employee cannot be fired for reasons contrary to the law, e.g., discrimination against a pregnant employee
under the Charter).
• Fixed term: employment terminates at the end of the fixed term, on the defined date — no notice of
termination is required.
Terminating a Fixed-Term Contract Early ⭐
A fixed-term contract can be terminated early for a serious reason (CCQ 2094), or by mutual agreement of both
parties. Without a serious reason, fixed-term contracts often contain a contractual termination clause (e.g.,
either party may terminate by giving two weeks' prior notice) — this is a contractual clause the parties agreed
to, not a legal requirement. The reasonable notice provisions of CCQ 2091 do not apply to a fixed-term contract.
Lesson 4 examines the principles of employment law under the Civil Code of Quebec (CCQ) and the Labor
Standards Act (LSA). Topics include the formation and duties of an employment contract, non-competition
clauses, the rules for terminating employment under both the CCQ and the LSA, whistleblowing, workplace
behaviour and privacy, employer liability for employee-caused damages, the distinction between an employee
and an independent contractor, and psychological harassment under the LSA.
⭐ 4.0 Introduction
Most people will, in their lifetime, be either an employer or an employee, making Employment Law a very
important area of law. This lesson looks at the employee's duties to the employer, the employer's rights to
terminate an employee, and the employer's obligation to prevent psychological harassment at work.
KEY FRAMEWORK ⭐
When analyzing a court case, remember: the names of the parties, the facts of the case, the legal
issue, the position of each party, and the final court judgment.
⭐ 4.1 Introduction to Employment Law
KEY DEFINITION ⭐
Under CCQ 2085, an employment contract is a contract where a person (the employee) undertakes
for a limited period to do work for remuneration (payment), according to the instructions and
under the direction/control of another person (the employer). This course covers individual
contracts of employment only — not unions or collective agreements.
Subordination is the legal term describing the fact that employees are required to do what their
employer tells them to do.
Fixed or Indeterminate Term (CCQ 2086) ⭐
Type Description
Fixed term Hired for a period of time with a finite, defined ending date (e.g., a 6-
month contract starting today).
Indeterminate term No ending date is discussed in the contract — the contract could last
months or years, with no defined end.
Duty of Employer (CCQ 2087)
KEY DEFINITION ⭐
The employer has a general obligation to provide the employee with a physically and morally safe
working environment — clean, properly heated/air conditioned, properly lit, and safe from physical
and emotional intimidation.
,Duty of Employee: Fiduciary Duty (CCQ 2088) ⭐
KEY DEFINITION ⭐
The employee has a duty to act in the best interest of the employer: to carry out work with
prudence and diligence, to act faithfully and honestly, and not to use any confidential information
obtained in the course of the work.
Confidential information covers all information relating to the employer's business — client lists, pricing,
intellectual property (patents, trademarks, copyrighted material), financial information, etc. It also covers all
information the employee creates as part of the job — even though the employee created it, it belongs to the
employer.
• ⭐ When an employee leaves a job, they cannot take any confidential information with them without the
employer's prior consent — including information they themselves created on the job.
⭐ 4.2 Non-competition Clause
KEY DEFINITION ⭐
Under CCQ 2089, the parties may stipulate in writing and in express terms that, even after
termination of the contract, the employee may neither compete with the employer nor participate
in any capacity in a competing enterprise. Non-competition clauses are not implied — they must be
expressly written in the signed employment contract, or they do not exist.
Three Elements of a Valid Non-competition Clause ⭐
The non-competition clause must be limited to what is necessary to protect the employer's legitimate interests,
in three respects:
• Time: a defined period during which the employee cannot compete.
• Place: a defined geographical area.
• Type of employment: the specific type of job the employee is not allowed to do.
KEY CONCEPT ⭐
Reverse burden of proof: the burden of proving that a non-competition clause is valid is on the
employer — the employer must prove both that the employee breached the contract (is competing)
and that the clause itself (time, place, and type of employment) is reasonable in scope. This is a
difficult proof to make, and Quebec courts rarely enforce a non-competition clause against a regular
employee.
Contracts of Adhesion ⭐
Employment contracts are often contracts of adhesion — contracts where one party (the employer) has all the
bargaining power and the other (the employee) has none; the employee will effectively sign just about anything
to get a job, and the courts are aware of this.
CCQ 2095: if the employee was not fired for a serious reason (CCQ 2094), the courts will not even let the
employer attempt to plead the validity of a non-competition clause — a further indication of how much Quebec
courts dislike enforcing non-competition clauses in regular employment contracts.
, Non-competition: Employment Contracts vs. Sale of a Business ⭐
Aspect Regular Employment Contract Sale of a Business
Bargaining power Unequal — employer imposes terms, Generally equal — willing buyer and
employee has no real power to willing seller, negotiated
negotiate (take it or leave it)
What is being N/A — employee provides labour The buyer pays for
purchased/protected goodwill/intangibles (reputation,
customer lists) in addition to
physical assets
Court's willingness to Very reluctant — rarely enforced Courts are prepared to enforce a
enforce a non- against a regular employee reasonable non-competition clause
competition clause
EXAM EXAMPLE
A buyer purchases a business, paying for its goodwill, reputation, and customer list. If the seller
could simply open a new, competing business across the street and say “I welcome all my old
customers,” the buyer would be unfairly deprived of the value they paid for. In this context (unlike a
regular employment contract), the courts would be prepared to enforce a reasonable non-
competition clause.
⭐ 4.3 Termination Under the CCQ
Reasonable Notice (CCQ 2091) ⭐
KEY DEFINITION ⭐
Either party may terminate an employment contract for an indeterminate term by giving
reasonable notice to the other party. Reasonable notice must take into account the nature of the
employment, the specific circumstances (e.g., did the employer induce the employee to quit a prior
job to come work for them), and the duration of the period of work — generally, the longer the
employee has worked for the company, the longer the notice period should be.
Notice for Indeterminate vs. Fixed Terms ⭐
• Indeterminate term: the employee can be fired at any time, as long as reasonable prior notice is given (an
employee cannot be fired for reasons contrary to the law, e.g., discrimination against a pregnant employee
under the Charter).
• Fixed term: employment terminates at the end of the fixed term, on the defined date — no notice of
termination is required.
Terminating a Fixed-Term Contract Early ⭐
A fixed-term contract can be terminated early for a serious reason (CCQ 2094), or by mutual agreement of both
parties. Without a serious reason, fixed-term contracts often contain a contractual termination clause (e.g.,
either party may terminate by giving two weeks' prior notice) — this is a contractual clause the parties agreed
to, not a legal requirement. The reasonable notice provisions of CCQ 2091 do not apply to a fixed-term contract.
