Employment law in Canada is founded on the principles of contract law common to many jurisdictions but also incorporates some uniquely Canadian concepts. In Canada, as in the United States and other jurisdictions, employment law deals with non-unionized employees and should be distinguished from labour law (spelled "labour" in Canada) which deals with unionized workers. Some of the most important legal concepts and issues in Canadian employment law are contract law, wrongful dismissal, and reasonable notice damages.

Formation of the Employment Relationship

Before basic employment law comes into play there must be a valid employment contract in place. Such an employment contract may be a verbal or written and may be as simple or as complicated as required by the circumstances. The employer and employee relationship created by an employment contract must be distinguished from an independent contractor relationship which is also common in Canadian workplaces.

Wrongful Dismissal

Wrongful dismissal is another legal concept that is significant to Canadian employment law. Wrongful dismissal occurs when an employee is fired by an employer without just cause. In order for an employer to have just cause to fire an employee in Canada the employee must have acted in such a way as to demonstrate that they have repudiated the employment agreement and no longer wish to be bound by it. Examples of such behavior include actions of dishonesty such as theft from an employer, continual village emploifrom work, or serious insubordination towards an employer. Smaller examples such as poor performance or misbehavior will not constitute just cause for an employer to fire an employee for just cause.

Reasonable Notice Damages

Reasonable notice is also an important concept to Canadian employment law. When an employee is wrongfully dismissed from their employment they may claim reasonable notice damages from their employer. Reasonable notice damages represent a period of time over which an employee who has been terminated is entitled to their regular rate of pay and benefits while they search for new employment. In order to be entitled to these damages the employee must be searching for new employment during the reasonable notice period. The length of the reasonable notice period, the time during which the employee receives their regular salary, is based upon the former employee's age, the length of time they were employed, the job market, and the nature of the work done. In Canada such reasonable notice periods may be as short as one week or as long as 24 months.