Over the course of the pandemic, many employers (particularly those in retail, hospitality and tourism) experienced a significant downturn in business. As a result, some made the difficult decision to either lay-off or dismiss staff. A recent court decision from British Columbia considers whether an employer’s dramatic loss of revenue (which informed the decision to end employment) should properly be considered a “frustration of employment.”

Q&A is a recurring series on the Vey Willetts LLP blog. The aim is to provide quick answers to questions we commonly encounter in our day-to-day practice of employment law. In this edition, we focus on “frustration of employment.”  

The legal doctrine of frustration of contract is well known to employment lawyers but its application is not all that intuitive to the average employer or employee. In the recent case of Hoekstra v. Rehability Occupational Therapy Inc., 2019 ONSC 562, the Ontario Superior Court of Justice was asked to revisit this doctrine and opine as to whether an employee, as compared to an employer, can ever assert frustration to end an employment relationship.