Your First Employment Law Negotiation: What You Need to Know

By: Richa Sandill, Staff Lawyer and Team Lead, Don Valley Community Legal Services/TEEILS

Thanks to courtroom dramas and movies, many people envisage the legal process as a dramatic series of events that culminates in a day in court. And while this is true for some cases, the reality, especially in employment law cases, is that many cases have a successful outcome without ever actually making it to the courtroom. In this article, we will take you through the more likely way that you will end up dealing with an allegation of wrongful dismissal as an employee: the demand letter process.

What is Employment Law?

For those that may not be familiar, employment law is a catch-all term for the areas of law that intersect to inform the employment relationship. That can include the law surrounding how much notice someone should get when they are dismissed (fired), human rights, workplace injury laws, occupational safety laws, and employment standards laws.

The term “wrongful dismissal” is a term heard often in employment law. Contrary to what many people think, unless just cause is involved, in most cases wrongful dismissal is not actually about whether your employer was “wrong” to dismiss you, or even about whether you were a bad employee. Rather, the “wrong” part is the failure to give you enough “notice” of termination – which many people in layman’s terms call severance packages. When you come to an employment lawyer after a termination, the length of notice that you have been given is the first thing we look at before we tell you whether or not you should sign any documents for a severance package. We also scan for any other intersecting issues and whether they impacted your employer’s decision to terminate you in a way that might violate other laws, such as the Human Rights Code, for example.

The length of “notice” you are entitled to as an employee can vary from person to person. It depends on things like your length of service, your age, your position, your employment contract and any limitations it has, and market conditions for finding other employment. “Notice” often translates to either a continuation of your salary for a number of months, or notice in advance that you will be terminated on a specific date, or alternatively, a big lump sum in the amount of X number of months of your salary. This is determined on the factors outlined above. The failure of an employer to give you enough notice, or any notice at all when you should have received notice, is the heart of a wrongful dismissal case.

I’ve Been Wrongfully Dismissed – Time for the Courts?

It is always worth getting advice first from an employment lawyer before signing any documents in a severance package to determine if it is fair, reasonable, or if it is not enough. You have two years from the date of a dismissal to start any civil court action. But before you do that, it is worth considering settlement for a number of reasons.

Many employment law cases – dare we say even most – settle before even making it to the courts. There are several reasons for this, ranging from backlogs at courts to the convenience of simply being able to come to an agreement on how much someone might be owed. The biggest advantage to settlement, as opposed to litigation, is to avoid the uncertainty and lack of guarantees in a wrongful dismissal case. This is particularly true keeping in mind the focus of most straightforward without cause wrongful dismissal cases: determining how much someone should get as notice, rather than proving how good or bad you were at your job.

Settlement Tool: Demand Letters

The most commonly used tool to facilitate pre-court settlements in employment law is a “demand letter”. This is a letter usually written by a lawyer or paralegal on their client’s behalf, setting out the dismissed employee’s side of the story. It ends with a demand for payment of a proposed amount, and carries with it an underlying threat of litigation if the employer does not meet the demand.

If the employer is responsive and open to negotiation, parties will go back and forth from there until they either reach a settlement, or it’s clear that nothing is going to happen without a court or Tribunal action being started.

Demand letters are voluntary tools that many employment lawyers and clients use to negotiate severance packages. Although there is a possibility of a court process, they are not subject to specific rules or timelines beyond what the parties set for themselves in a negotiation. Demand letters are also “without prejudice”. This means that the things that are said and the offers that are made in the letter should not come up in court (there are some exceptions), and should not affect your case down the line provided such statements are made in good faith to try to resolve a matter.


It is always best to seek legal advice if you have been dismissed so you can understand what might be the best route for you. There are some employers who may not wish to negotiate, or who might make it necessary to start immediate litigation. However, there are many ways and tools, even in a stressful situation like a termination, to make things simpler that will lead to a more efficient outcome. The demand letter is one such tool and any lawyer you speak with will propose it as an option.

This is legal information and not legal advice. If you need further information or need legal advice, please call our Intake Line at 416-441-1764 ext. 1 or complete our online Intake Form.