Termination TermsVariable PayCovenantsChange of Control
Before You Sign | Negotiable Terms | Departure Scenarios | Consideration
Where the value sits in a senior agreement.
The termination clause decides most of what a departure is worth.
Bonus and equity language decides whether variable pay survives it.
Restrictive covenants decide what you can do next.
Change of control provisions decide what a transaction is worth to you.
Quick Answer
What should an executive check before signing an employment agreement in Ontario?
The four terms that matter most are the termination provision, the treatment of bonus and equity on departure, any restrictive covenants, and the change of control provision. A termination clause that limits entitlement to statutory minimums can reduce a future departure by a very large amount, and it is negotiable at the offer stage in a way it never is afterwards. Signing first and reviewing later removes all leverage, because a contract presented after employment begins may still bind, and renegotiation requires the employer to agree.
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THE MOMENT OF LEVERAGE
Before Signing, Not After
At the offer stage an employer has chosen you, has probably run a search, and wants the matter concluded. That is the only point in the relationship at which the terms are genuinely negotiable, and it is brief.
After signing, changing the agreement requires the employer to agree to something that benefits you and costs them, without any pressing reason. Some employers will. Most will not, and the request itself can sit awkwardly.
The counterargument people make to themselves is that asking for changes looks difficult and might jeopardise the offer. In practice a measured set of requests, put through counsel and focused on a small number of terms, is normal at senior level and is rarely received badly.
THE FOUR TERMS
Where the Money Actually Is
The termination provision comes first, because it determines what a future departure is worth. A clause limiting entitlement to statutory minimums converts what might be a substantial common law claim into a modest one. This is the single most valuable term to negotiate and the one most often accepted without comment.
The bonus and equity language comes second. Whether variable compensation survives a dismissal turns on the plan wording, and at senior level that is frequently the larger part of the package. Ask for the plan documents rather than accepting a summary.
Restrictive covenants come third. A non competition clause can determine whether you can work in your industry after leaving, and Ontario now restricts non competes in employment agreements in defined circumstances while leaving non solicitation largely intact. What the covenant actually prevents, and for how long, is worth understanding before rather than after.
Change of control comes fourth and matters most in businesses likely to be sold. Whether a transaction accelerates vesting, triggers a payment, or entitles you to leave with compensation can be worth more than several years of salary.
DEPARTURE SCENARIOS
Read It As If It Has Gone Wrong
The useful way to read a senior agreement is to imagine four departures and check what the document produces in each. Dismissal without cause. Dismissal alleging cause. Resignation. And a departure following a change of control or a material reduction in your role.
Most agreements are drafted with the first scenario in mind and are vague about the others. The gaps are where disputes come from, particularly around what constitutes good reason to leave and whether a demotion after a transaction triggers anything.
Reading this way also surfaces the interaction between clauses. A generous severance term can be undermined by a broad cause definition, and a valuable equity award can be defeated by a forfeiture provision several pages away.
HOW WE WORK
What to Bring, and What to Expect
Bring the draft agreement, the offer letter, and every plan document it refers to, including bonus, equity, pension and any deferred compensation arrangement. If a term sheet came first, bring that too, since it sometimes promises what the agreement does not deliver.
Expect a short list rather than a redraft. Asking for twenty changes to a senior agreement wastes the goodwill that would have secured three important ones. The value is in identifying which terms actually matter for your circumstances.
Expect to be told where the agreement is fine. Many senior contracts are reasonable, and a review that confirms so is worth having before you sign rather than a worry carried for years.
Common Questions
Frequently Asked Questions
What should I check before signing a senior employment agreement?
The termination provision, the treatment of bonus and equity on departure, any restrictive covenants, and the change of control provision. Those four decide most of what the agreement is worth in the scenarios that matter.
Is it risky to ask for changes to an offer?
At senior level a focused set of requests put through counsel is normal and rarely received badly. The offer stage is the only point at which terms are genuinely negotiable.
Can I renegotiate after I have started?
Only if the employer agrees, and there is usually no reason for them to. A contract imposed after employment begins may also raise questions about consideration, but that is a defence rather than a plan.
Are non-competition clauses enforceable in Ontario?
Ontario restricts non competition agreements in employment contracts in defined circumstances, while non solicitation covenants remain broadly available. Whether a particular covenant binds you depends on its wording and your role.
Why does change of control matter?
In a business likely to be sold it can determine whether a transaction accelerates your equity, triggers a payment, or lets you leave with compensation. It is frequently worth more than several years of salary.
Our lawyers review senior employment agreements before they are signed. Call, email, or arrange a consultation. Bring the draft and every plan document it refers to.
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“I had the absolute pleasure of working separately with two lawyers from Lexaltico — Pooja Lassi and Matthew Ram — on different matters. The level of professionalism, expertise, and care demonstrated by each of them was consistently exceptional. They do not simply service your needs — they take the time to thoroughly understand your situation and proactively problem-solve.”
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★★★★★
“I had the absolute pleasure of working separately with two lawyers from Lexaltico — Pooja Lassi and Matthew Ram — on different matters. The level of professionalism, expertise, and care demonstrated by each of them was consistently exceptional. They do not simply service your needs — they take the time to thoroughly understand your situation and proactively problem-solve.”
SJR
Senior and executive employment
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College of Immigration and Citizenship Consultants Act, S.C. 2019, c. 29,
s. 292.
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The initial assessment
The no-obligation initial assessment is a brief introductory
conversation. It does not include a review of your documents and does not constitute
legal advice.
The firm charges a fee for substantive consultations, including in civil litigation,
criminal defence and immigration matters. The firm may waive that fee at its discretion.
Any fee is disclosed in advance and credited in full toward your account if you retain the
firm.
Referral fees
Where we refer a matter to another firm, including through LexKonnect, we comply with Rule 3.6-6.1 of the Law Society of Ontario’s Rules of Professional Conduct. Any referral fee is set out in the Law Society’s standard referral agreement, signed by you before the referral proceeds, and no fee is payable to us unless and until the receiving firm has been paid for its work. You are never obliged to accept a referral and are free to retain any firm you choose. No referral arrangement affects the independent professional judgment of any lawyer at this firm.
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platforms, all operated by others. We do not control them, we are not responsible for
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Other notices
Limitation periods
Failure to start a proceeding within the applicable limitation period may permanently bar
your claim. In Ontario the general period is two years from discovery
under the Limitations Act, 2002, S.O. 2002, c. 24, Sched. B.
Shorter periods apply to many claims. Seek advice promptly. Nothing on this website extends a
limitation period.
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