Bad Faith in the Manner of Dismissal in Ontario: What Extra Damages Are Possible

Being fired is difficult under the best of circumstances. Being fired in a way that is needlessly humiliating, dishonest, or cruel is a different problem entirely — and Ontario law recognizes that distinction. It is not just whether you were let go, but how it was done, that can affect what you're owed.

Understanding bad faith dismissal damages in Ontario starts with separating two questions that are easy to blur together: was there enough notice (or pay in lieu), and was the manner in which the dismissal happened itself unfair.

The Basic Rule: Dismissal Itself Isn't Bad Faith

An employer generally can end a non-unionized employee's job without cause, without any wrongdoing, as long as proper notice — or pay instead of notice — is given. That is the core of what "wrongful dismissal" actually means in Ontario law: a notice problem, not a fairness-in-the-abstract problem. Being let go, even unexpectedly and even after years of loyal service, is not on its own evidence of bad faith.

What Counts as Bad Faith in the Manner of Dismissal

What can cross the line is how the employer carried out the dismissal — separate from whether adequate notice was provided. Conduct that courts have generally treated as troubling includes things like:

• Being untruthful or misleading about the real reason for the dismissal
• Publicly humiliating the employee in front of colleagues, clients, or on social media
• Making unfounded allegations of cause or misconduct without a genuine basis
• Terminating in an abrupt, callous manner with no regard for the employee's dignity
• Failing to deal with the employee candidly and fairly during the termination process

No single incident automatically qualifies, and this is not an exhaustive checklist — it's a general obligation of good faith and fair dealing in how the employment relationship ends, assessed against all the circumstances.

How Courts Respond to Bad-Faith Conduct

Where a court finds the manner of dismissal was carried out in bad faith and that this caused the employee genuine, provable harm beyond the ordinary distress of losing a job, it can award additional compensation on top of what the notice period itself would otherwise provide. The exact form and amount of that additional compensation is always case-specific — there is no standard figure or percentage, and courts approach every case on its own facts.

What Bad Faith Is Not

• Bad faith is not the same as "I disagree with being let go." Disagreement with the decision itself doesn't establish bad faith in how it was carried out.
• Bad faith is not automatically established by a harsh business decision. An employer can make a difficult, even seemingly cold, business decision to eliminate a role without that decision itself being in bad faith.
• Bad faith generally requires more than an employer simply being blunt. Directness in delivering difficult news is not, by itself, evidence of bad faith — the concern is dishonesty, humiliation, or unfair dealing.

Building a Bad-Faith Claim: What Helps

If you believe your dismissal was handled in bad faith, the strength of any claim usually turns on documentation and specifics, not general impressions.

• [ ] Write down what was said during the termination meeting as soon as possible, while your memory is fresh.
• [ ] Keep any emails, texts, or written communications from around the time of the dismissal.
• [ ] Note who else was present or aware, and whether anything was said or done in front of others.
• [ ] Keep records of any impact on your health or wellbeing, including any medical attention sought.
• [ ] Avoid posting about the situation publicly before speaking with a lawyer — it can complicate your position.

Frequently asked questions