The Ontario court decision of McPherson v. Global Growth Assets Inc., 2025 ONSC 5226 (CanLII) sends a clear message: when an employee is terminated, the employer cannot use the court process to punish, intimidate, or delay payment by launching unfounded counterclaims.
In this case, the court rejected an employer’s attempt to turn a wrongful dismissal lawsuit into a drawn-out fight over alleged misconduct that was never raised before termination. The employee succeeded not only in defending the claim, but in securing full wrongful dismissal damages and a strong costs ruling.
Background of the Case
The employee had worked for the company for more than 12 years in a senior executive role and earned over $400,000 annually. He was terminated without cause in 2019.
After the employee brought a wrongful dismissal claim, the employer responded with a $1.75 million counterclaim. The employer alleged breaches of duty and misconduct, all of which the employee denied. Much of the 10-day trial was spent dealing with these allegations.
What the Court Decided
No Proven Misconduct
The court rejected all allegations of wrongdoing. Claims about poor supervision, improper compensation, and other misconduct were unsupported by evidence. The court noted that if these issues were genuine concerns, they should have been addressed before termination.
No Fiduciary Duty
Despite the employee’s senior title, the court found he was not a fiduciary. His role was to implement decisions made by leadership, not to subordinate his personal interests to the company’s at all times.
Termination Without Cause Confirmed
Because the employer failed to establish just cause, the termination remained without cause. Attempts to justify the dismissal after the fact were unsuccessful.
Damages Awarded to the Employee
Based on the employee’s length of service, senior role, and age, the court awarded 16 months of common law notice.
The compensation included:
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Base salary
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Full bonus entitlement (based on a three-year average)
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Benefits continuation
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Employer contributions to a group RRSP
The total wrongful dismissal award was $734,510.99.
Court Pushes Back on Harassment and Delay Tactics
Vexatious Counterclaim
The court found the counterclaim to be baseless and speculative, with no credible factual or legal foundation. It was described as vexatious and designed to increase pressure and costs for the employee.
As a result, the employer was exposed to a substantial indemnity costs award, likely covering a significant portion of the employee’s legal fees.
No Trial Delays Allowed
During trial, the employer attempted to introduce new evidence that had not been properly disclosed. Doing so would have required delaying the trial. The court refused.
The judge emphasized that trials must proceed on schedule and that parties cannot use the process to search for evidence that should have existed before trial began.
Key Takeaways for Employees
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Employers cannot rewrite history. If misconduct was not raised before termination, courts are skeptical of allegations introduced later.
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Baseless counterclaims can backfire. Courts may view them as harassment and award significant costs in favour of the employee.
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Delays are not tolerated. Employers cannot stall proceedings by introducing late evidence or expanding claims mid-trial.
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Wrongful dismissal protections are real. Courts will enforce notice entitlements and protect employees from litigation abuse.
If you have been terminated and your employer is raising new allegations or delaying payment, an employment lawyer can help you understand your rights and assess whether the employer’s conduct is appropriate under Ontario law. Don’t wait for problems to grow, contact us today for a free 30 minute phone consultation.