CIBC Employees Win Wrongful Dismissal Against Canada's Biggest Bank

Most employees sign their employment contracts without reading the termination clause carefully. That clause, buried in the fine print, determines what you are owed if your employer ever lets you go. As a 2025 Ontario Superior Court decision makes clear, that clause may not be worth the paper it is printed on.

In Ghazvini et al v. Canadian Imperial Bank of Commerce, 2025 ONSC 5218, two CIBC employees had their termination provision struck down entirely  and walked away with up to 12 months of wrongful dismissal damages, plus their 2022 annual bonuses.

Kourosh Ghazvini and Sandra Rose were Mobile Investment Consultants (“MICs”) at CIBC. Both were terminated without cause in September 2022 as part of a corporate restructuring, effective October 7, 2022. At the time of dismissal, Mr. Ghazvini was 38 years old with approximately 4.5 years of service; Ms. Rose was 54 years old with approximately 5.5 years of service.

CIBC paid each plaintiff their minimum statutory entitlements under the Canada Labour Code (“CLC”). The question before the court was whether the termination clause in their employment contracts was enforceable. If not, what was their termination entitlements at common law?

Both plaintiffs had signed the same CIBC employment agreement, which contained three relevant provisions:

The For Cause Provision allowed CIBC to terminate without notice or pay for a broad list of reasons, including dishonesty, fraud, breach of trust, failure to perform duties satisfactorily, and breach of any term or condition of employment. The list was expressly non-exhaustive: “Cause includes, but is not limited to” the listed items.

The Without Cause Provision provided for two weeks’ notice per completed year of service, subject to a minimum of three weeks and a maximum of 18 months, but only if the employee signed a full and final release. It also allowed termination “at any time” without cause.

The Saving Provision stated that if any part of the termination provision failed to meet statutory minimums, the statutory minimums would apply.

The court found that the For Cause provision violated the CLC because it defined “cause” more broadly than the legal standard of “just cause” under the Code.

Under the CLC, just cause requires serious misconduct and even then, context matters.

The Supreme Court confirmed in McKinley v. BC Tel, 2001 SCC 38 that even dishonesty does not automatically justify dismissal; the employer’s response must be proportional to the misconduct.

The CIBC clause, by contrast, listed “dishonesty” as a standalone trigger for termination without notice or pay — alongside items like “failure to perform your duties in a satisfactory manner” and “breach of any term or condition of your employment.”

None of those things necessarily amount to just cause under the CLC, depending on the circumstances.

Justice Merritt found that an employee reading this clause would not know with certainty when CIBC could lawfully terminate without notice.

Worse, an employee who had committed some minor or isolated act of dishonesty might simply accept a for-cause termination, believing the clause authorized it, without ever knowing they had rights under the CLC.

This is where the 2020 Ontario Court of Appeal decision in Waksdale v. Swegon North America Inc. becomes critical.

Before Waksdale, courts sometimes looked at each part of a termination provision in isolation. A flawed “for cause” section would not necessarily bring down an otherwise valid “without cause” section.

Waksdale changed that.

Courts must now assess a termination provision as a whole. If any part of it violates the applicable employment standards legislation, the entire provision is unenforceable — regardless of whether the employer actually relied on the problematic part.

Because the For Cause Provision violated the CLC, the entire termination clause, including the Without Cause Provision, was struck down.

CIBC’s contract included a standard saving provision: if any part of the termination clause failed to comply with applicable legislation, the statutory minimums would apply instead.

Ontario courts have consistently rejected saving provisions as a cure for non-compliant termination clauses. The policy rationale is straightforward: if employers could escape the consequences of drafting an illegal clause simply by adding a saving provision, they would have no incentive to draft compliant contracts in the first place. 

 

 

With the termination clause struck down, both plaintiffs were entitled to reasonable notice at common law. The court applied the familiar Bardal factors: age, length of service, character of employment, and availability of comparable alternate employment.

Several factors pushed the notice periods upward:

• Both plaintiffs worked in a sales-based role that required building a long-term book of business — business they could not take with them due to restrictive covenants in their contracts.
• CIBC terminated hundreds of MICs in the same restructuring, flooding the applicant pool and reducing available comparable employment.
• The MIC role appeared to be unique to CIBC, with no equivalent position elsewhere in the industry.

Mr. Ghazvini (38 years old, 4.5 years of service): 7 months’ notice.

Ms. Rose (54 years old, 5.5 years of service): 12 months’ notice.

Damages were calculated based on what each plaintiff would have earned during the notice period, including base salary, commissions, and benefits. Because both plaintiffs’ incomes had been on a clear upward trajectory, the court rejected CIBC’s proposal to use a three-year average, which would have significantly undercompensated them.

Damages were calculated using annualized 2022 figures: $110,000 total compensation for Mr. Ghazvini (salary plus commissions) and $117,000 for Ms. Rose, plus 10% of base salary for lost benefits in each case.

Both plaintiffs were terminated just 3.5 weeks before CIBC’s fiscal year end. Had they received proper working notice, they would have been actively employed in December 2022 when the annual bonus was paid.

The court found that both plaintiffs would likely have achieved an “Exceeded Goals” rating for 2022, based on consistent feedback from their managers throughout the year, performance awards, and strong sales volumes.

Mr. Ghazvini’s 2022 bonus: $62,376.16.

Ms. Rose’s 2022 bonus: $99,663.

Both plaintiffs explored alternative employment. Mr. Ghazvini was offered a financial advisor role at TD Bank at roughly $60,000 with no commissions; a significant step down from his CIBC compensation. Ms. Rose declined commission-only roles at RBC and Primerica.

The court found neither plaintiff had failed to mitigate. It is not unreasonable for a dismissed employee to hold out for comparable work rather than accept the first available position at a substantially reduced income.

CIBC is not alone. Many standard form employment contracts contain non-exhaustive lists of termination triggers that sweep more broadly than the legal standard of just cause. After Waksdale, any such overbreadth in the for-cause provision will void the entire termination clause.

This case arose under the Canada Labour Code, which applies to employees in federally regulated industries such as banking, telecommunications, and interprovincial transportation. The CLC’s just cause standard can be, at times, more demanding than the “wilful misconduct” standard under Ontario’s Employment Standards Act, 2000. Employees in federally regulated workplaces should be aware that their termination rights may be more robust than those of provincially regulated workers.

A saving provision at the end of a termination clause does not rescue non-compliant language. If your employment contract purports to allow termination for conduct that would not meet the legal threshold for just cause, that clause is likely unenforceable in its entirety.

Damages in wrongful dismissal cases must reflect the compensation the employee would actually have earned during the notice period. Where commission income is on an upward trend, courts may reject a three-year average that fails to account for that trajectory.

At Pinto Shekib LLP, our Toronto employment litigation team specializes in “Cause” litigation. Contact us at 416.901.9984 or info@pintoshekib.ca for a confidential consultation.