Can I be personally liable as a director if my Ontario corporation fails to pay employee wages?

Yes. Under the Ontario Business Corporations Act, directors of an Ontario corporation are jointly and severally liable for up to six months of wages owing to employees if the corporation does not pay them. This is one of the most significant forms of personal director liability in Ontario, and it applies regardless of whether the director was involved in the day-to-day decision to withhold wages.

The liability also extends to vacation pay. Under the Ontario Employment Standards Act, directors can be held personally responsible for unpaid vacation pay owed to employees. The claim must generally be brought within two years of the director ceasing to hold office, though the precise limitations period may depend on the circumstances.

The liability is personal and individual — it is not capped by the size of the director's investment in the company. A director who invested $10,000 in shares can face a personal wage judgment far exceeding that amount. To limit exposure, directors should monitor the company's payroll obligations carefully, insist on regular financial reporting, and treat wage obligations as priority payments. If the company is in financial difficulty, getting legal advice early — before wages are missed — can help directors understand their exposure and the options available to address it.