At Human Capital Benefits, we’ve long encouraged our clients to have their employment agreements reviewed by an employment lawyer if it’s been more than three years. Employment law keeps shifting, and a clause that was fine a few years ago can now be found unenforceable, often the termination clause, which is the one that matters most when a relationship ends.
A recent blog from our friends at e2r® is a timely reminder that updating the agreement is only half the job. How you introduce it matters just as much.
THE CASE
Chowanetz v. Ivor Forest Products Ltd., 2026 BCSC 1760
A B.C. employer gave an existing employee a new agreement. Its termination clause limited the employee to the minimum entitlements under the B.C. Employment Standards Act. When the employee was later let go, they sued for wrongful dismissal. They argued the new clause didn’t apply because they got nothing new in exchange for signing.
The employer pointed to three things it said the employee received: a raise, RRSP eligibility, and bonus eligibility. The Court rejected all three:
| WHAT THE EMPLOYER OFFERED | WHY IT DIDN’T COUNT |
| RRSP and bonus eligibility | Negotiated separately and not referenced in the new agreement. The employee would have had them either way. |
| Wage increase | The original agreement already promised an annual wage review. The raise was an existing entitlement, not something new. |
Because there was no fresh “consideration” (legal term for something of value given in exchange), the termination clause failed. The employee was awarded common law notice, which is typically far more generous than the statutory minimum.
THE TAKEAWAY FOR EMPLOYERS
- A routine raise likely won’t count as payment for signing a new agreement.
- What you offer must be new, clear, and tied directly to the signature.
- The test: if the employee doesn’t sign, they don’t get it. No ambiguity.
OUR ADVICE: If your agreements are more than three years old, have them reviewed. And before rolling out new ones to current staff, get legal advice on what you’ll offer in exchange. A contract that can’t be enforced protects no one.
SOURCE
e2r®, “New Employment Agreements? Consider the Consequences,” October 15, 2026. e2r® | 70 The Esplanade, Suite 401, Toronto, ON M5E 1R2.
This summary is for general information only and is not legal advice.