A well-drafted employment agreement protects both the employer and the employee by setting out clear expectations from day one. But an employment contract is not a "sign it and forget it" document. Ontario employment law changes, businesses evolve, and courts regularly find older agreements unenforceable. Reviewing your agreements on a schedule — and after key events — is one of the simplest ways to reduce risk.

Why an Outdated Agreement Can Backfire

The most common problem employers face is a termination clause that no longer complies with current law. If a court finds that even one clause violates the Employment Standards Act, it can strike down the entire termination provision — leaving the employer exposed to much larger common-law notice obligations. In other words, an old contract can leave you less protected than you think.

Update After a Change in Role or Compensation

When an employee is promoted, takes on significantly different responsibilities, or receives a major change in pay or structure, it's a natural moment to refresh the agreement. A contract signed years ago for an entry-level role may not reflect the person's current position — and courts sometimes treat a substantially changed role as a new relationship that the old contract no longer governs.

Update When the Law Changes

Employment standards, and the case law interpreting termination clauses in particular, continue to shift. Provisions that were considered safe a few years ago may now be unenforceable. Because these changes tend to affect termination and notice language — the highest-stakes part of any agreement — it's worth having contracts reviewed periodically against the current legal landscape.

Signs It's Time for a Review

  • The agreement is more than two or three years old
  • You're promoting an employee or materially changing their role
  • You're introducing new policies, bonuses, or benefits
  • You use the same template across very different positions
  • You've never had the termination clause professionally reviewed
  • Your business has grown or restructured significantly

Getting Consideration Right

One technical but critical point: asking a current employee to sign a new or updated agreement generally requires fresh consideration — something of value in exchange for agreeing to the new terms. Simply presenting a new contract without it can render the update unenforceable. This is an area where getting the process right matters as much as the wording.

A Practical Approach

For most Ontario employers, the sensible rhythm is to review your standard employment agreement whenever the law meaningfully changes, whenever you promote or restructure, and otherwise every couple of years as a matter of housekeeping. Catching a problem before a dispute arises is far cheaper than discovering it during a termination.

Solvine Law drafts and reviews employment agreements on a flat-fee basis and can tell you whether your current contracts still do their job. If it has been a while since anyone looked at yours, that review is a small investment against a potentially expensive problem.