Termination of Canadian Employee in U.S. Gives Rise to Lawsuit in Ontario

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Recently the Court of Appeal for Ontario considered whether a wrongful dismissal action against his former employer should be tried in the state of Indiana instead of in Ontario.

In this case, the worker (a Canadian citizen) began his career in Canada. When his services were not needed in Canada, the company moved him to temporary jobs in the U.S. and agreed to find a permanent job for him in Canada when conditions there changed.

After 21 months in the U.S., he accepted a permanent job with the company managing one of its U.S. facilities. He was dismissed while working at a U.S. location. The plaintiff started his action in Ontario and the defendant moved for a stay of the action on the ground that Indiana, not Ontario, was the convenient forum to hear the action. The trial court granted the stay.

The Court of Appeal for Ontario reversed. According to the court, when deciding these motions, judges consider a list of factors including: the location where the contract in dispute was signed; the applicable law of the contract; the location of witnesses, especially key witnesses; the location where the bulk of the evidence will come from; the jurisdiction in which the factual matters arose; the residence or place of business of the parties; and the loss of a legitimate juridical advantage. When weighing these factors, the plaintiff’s choice of jurisdiction is given great deference, and “the existence of a more appropriate forum must be clearly established to displace the forum selected by the plaintiff.”

Here, the Court found that plaintiff’s connections to Ontario are strong: plaintiff resides there; two of the defendants reside there; some important witnesses reside there; the 2004 employment agreement was made there; and Ontario law applies to the agreement. Since plaintiff’s connections to Ontario were strong, the Court determined that he may legitimately claim the juridical advantages available in Ontario, including the right to reasonable notice of termination or pay in lieu.

Given this decision, U.S. companies doing business in Canada should ensure that they are familiar with Canadian employment laws. Further, U.S. companies should be prepared to produce information related to the above factors to demonstrate that their cases are more appropriately heard in the U.S.

Disclaimer: This Litigation and Dispute Resolution Law Alert is provided for informational purposes only and is not intended to serve as or provide legal advice relating to a particular matter. If you would like to discuss a litigation, arbitration or dispute matter please contact Jon P. Yormick, Managing Attorney, [email protected], Jason B. Desiderio, Associate,[email protected], or Nicholas A. Panagopoulos, II, Associate, [email protected], or call toll free(U.S. and Canada) at +1.866.967.6425.


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