Ontario worker's 2-year secondment ended early; terminated after original role was filled
An Ontario worker who had his secondment terminated early followed by termination of his original employment is not entitled to compensation for termination of both, the Ontario Superior Court of Justice has ruled.
Mounir Nader was hired in 2016 by the University Health Network (UHN) in Toronto to be its executive vice-president, clinical operations — later changed to clinical support and performance. His employment agreement set out his pay, benefits, expenses, and eligibility for a performance bonus of up to 25 per cent of his base salary. It also included a termination clause that allowed UHN to terminate his employment without cause with the payment of an amount equal to 12 months’ salary.
In June 2019, Ontario Health expressed an interest to both Nader and UHN in having him temporarily fill the role as its interim chief transformation officer for its transformation team. Nader was interested, although some people told him they were concerned that there would be no guarantee that his UHN position would still be available at the end of the secondment.
However, Nader’s interest continued and Ontario Health prepared a draft secondment agreement that included a clause saying that any party to the agreement could terminate it with four weeks’ written notice. Nader requested they remove that clause, which Ontario Health did.
The final form of the secondment agreement stated that “subject to early termination in accordance with this agreement, the employee will be seconded from UHN to Ontario Health for a period of two years from Sept. 3, 2019 to Aug. 31, 2021.” It also stated that during the secondment, Nader would remain a UHN employee, paid by UHN. When the secondment terminated, he would return to his executive vice-president position “or a comparable position, or else he would be entitled to the termination entitlement in his UHN employment agreement.
The agreement was signed by all three parties and Nader began the secondment on Sept. 3, 2019.
Early ending to secondment
In September 2020, Ontario Health informed Nader that the secondment would end on Oct. 23 of that year. UHN had hired another person to fill Nader’s old role, so it searched internally for comparable jobs for him. However, none were available, so UHN terminated Nader’s employment and provided him 12 months’ salary and benefits continuance.
Nader commenced an action against UHN, claiming that the secondment agreement was a fixed-term contract and he was entitled to the balance of the contract, separate from and in addition to his termination from his UHN position.
The court found that the secondment agreement clearly set out that Nader was still an employee of UHN and was governed by his employment agreement with it. It noted that the definition of “secondment” generally meant a transfer to another branch or department temporarily.
In addition, jurisprudence supported the concept that “against the backdrop of a continuing employment agreement, pursuant to which the original employer evinces an intention to remain the employer and retain responsibility for salary and benefits, a secondment agreement is not itself an employment agreement, but something other, and in its own category.”
Since the secondment agreement was not an employment agreement on its own, it couldn’t be a fixed-term agreement, said the court, noting that it incorporated the UHN employment agreement’s termination clause allowing for 12 months’ salary in lieu of notice. For more information see Nader v. University Health Network, 2022 ONSC 447.
