Introduction
In Bertsch v. Datastealth Inc., 2025 ONCA 379, the Ontario Court of Appeal confirmed that a properly drafted termination clause limiting an employee’s entitlements to the minimums under the Employment Standards Act, 2000 can be enforceable. For employers, the decision is a useful reminder that careful drafting matters: a clause that clearly tracks the ESA and avoids language that could be read as going beyond statutory minimums may be upheld and can bar common law wrongful dismissal damages.
For employees, the case shows that an argument based on ambiguity will not succeed simply because a clause could be misunderstood in the abstract. The court focused on whether the provision could reasonably be interpreted as complying with the ESA, not on whether an employee might subjectively read it too broadly.
Background Facts
Gavin Bertsch was hired as a vice-president with a base salary of $300,000 per year. After 8.5 months of service, his employment was terminated without cause. He received four weeks’ pay in lieu of notice and then brought a wrongful dismissal claim seeking common law damages.
Datastealth Inc. relied on the termination clause in the employment agreement, which stated that if employment was terminated “with or without cause,” the employee would receive only the minimum payments and entitlements owed under the ESA and its regulations. The agreement also included a separate provision stating that if any entitlement under the agreement was, or could be, less than the employee’s minimum ESA entitlements, the employee would instead receive the ESA minimums.
The motion judge held that the clause was enforceable and dismissed the claim. The Court of Appeal agreed.
Legal Issue
The central issue was whether the termination clause was void and unenforceable because it allegedly violated the ESA, or whether it validly limited the employee’s entitlements to ESA minimums and excluded common law reasonable notice.
Analysis
The employee argued that the clause was ambiguous and could be understood by an ordinary employee to permit termination without notice for conduct such as negligence, which would make it unenforceable. He also argued that the clause failed to comply with the ESA because it could be read as allowing termination for cause in circumstances broader than the ESA permits without statutory entitlements.
The Court of Appeal rejected that argument. The court emphasized that ambiguity requires more than competing interpretations. The question is whether the clause can reasonably be interpreted in a way that complies with the ESA.
Here, the court found the wording clear. The clause expressly stated that termination “with or without cause” would result in only the minimum payments and entitlements under the ESA and its regulations. In the court’s view, that language did not depart from the statutory minimums. The court also noted that the employee’s proposed reading would require ignoring the words “with or without cause.”
The court further observed that section 11(a) of the agreement operated as a failsafe by providing that if any entitlement under the agreement was, or could be, less than the employee’s ESA minimums, the employee would receive the statutory minimums. While the motion judge considered that provision unnecessary because the termination clause was already clear, it reinforced the overall structure of the agreement.
On that basis, the Court of Appeal held that the termination provision was unambiguous, enforceable, and effective to preclude common law wrongful dismissal damages.
Key Takeaway
Bertsch v. Datastealth Inc. confirms that an “ESA-only” termination clause can be enforceable where it is carefully drafted to align with statutory minimums and does not use overbroad language that could render it void. The decision is a practical reminder that employers should review termination provisions with precision, while employees should not assume that a clause is unenforceable simply because it limits recovery to ESA entitlements.
For employers and employees alike, the case underscores the importance of clear drafting and early legal review when employment agreements are being negotiated, updated, or enforced. If this issue may affect your workplace or employment contract, our Employment Law team can help assess the clause and its practical implications.