Wrongful Dismissal in Alberta: What Employees Need to Know in 2026

Losing your job is stressful under any circumstances. When it happens without warning, or when an employer claims just cause without real justification, the experience can be disorienting and financially devastating. If you have been terminated in Alberta and are wondering whether you were treated fairly, this guide is for you.

Wrongful dismissal is one of the most common employment law disputes in Alberta. It affects employees across every industry, at every level of seniority, from entry-level workers to senior executives. Yet the law governing what an employer owes you on termination is frequently misunderstood, and employers often rely on that misunderstanding when making lowball offers.

This post provides a comprehensive overview of wrongful dismissal law in Alberta, including excerpts from recent court decisions that illustrate how the law is being applied right now. We cover the legal foundation, what wrongful dismissal actually means, how courts determine what you are owed, and what you should do if it happens to you.

If you have recently lost your role and are wondering whether you have been wrongfully dismissed, you can book a consultation with our office to connect with one of our Calgary wrongful dismissal lawyers today.

10 Things You Need to Know About Wrongful Dismissal in Alberta

In case you are pressed for time, here are the ten essential takeaways from this post:

1. Wrongful dismissal is about inadequate notice, not the reason for termination.
2. Just cause is a very high bar that employers frequently fail to meet.
3. The Employment Standards Code sets the floor, not the ceiling. Common law notice is much greater.
4. Alberta wrongful dismissal damages exceeded the 24-month notice ceiling for the first time in 2026.
5. Subject to the terms of your employment contract, severance must account for all forms of compensation, not just base salary.
6. Termination clauses in employment contracts can limit your rights, but only with precise language.
7. The duty to mitigate is real, but the burden of proving failure falls on the employer.
8. Human rights law and wrongful dismissal law can overlap.
9. In certain circumstances you might be entitled to aggravated or punitive damages, but strategically it is generally better to focus on your notice entitlement.
10. Do not sign anything until you have independent legal advice.

The Legal Foundation: Employment in Alberta

Most employees in Alberta are provincially regulated, meaning their employment relationship is governed by Alberta’s Employment Standards Code (ESC) and the common law developed by Alberta courts. A smaller number of employees work in federally regulated industries, such as banking, telecommunications, and interprovincial transportation, and those employees are governed by the Canada Labour Code, which creates different rights and remedies.

The ESC sets out minimum entitlements that every employer must meet, including minimum notice periods on termination. But the ESC is a floor, not a ceiling. The common law provides a separate and typically much more generous entitlement to reasonable notice. Employees are entitled to the greater of their statutory minimums or their common law entitlement.

Employment contracts can modify common law rights, but only if the language used is clear and unambiguous. As discussed later in this post, courts apply strict rules when interpreting termination clauses, and ambiguous language is routinely resolved in the employee’s favour.

What Is Wrongful Dismissal?

Wrongful dismissal in Alberta means being terminated without just cause and without receiving adequate notice, or pay in lieu of notice. It is not, strictly speaking, about whether your employer had a valid business reason to let you go. Employers in Alberta can generally terminate employment for any reason, subject to a few statutory exceptions like discriminatory terminations, or for no reason at all, as long as they provide sufficient notice or compensation.

The “wrong” in wrongful dismissal is the failure to give you what you were legally entitled to when the employment relationship ended. That entitlement comes from two sources: your statutory minimums under the ESC and your common law right to reasonable notice.

Wrongful dismissal is distinct from several related legal concepts that often arise in employment disputes:

• Constructive dismissal occurs when an employer unilaterally changes fundamental terms of employment, forcing an employee to resign. The resignation is treated in law as a termination.
• Unjust dismissal is a separate remedy available to non-managerial federally regulated employees under the Canada Labour Code, which allows for reinstatement in certain circumstances.
• Layoffs involve a temporary or permanent reduction in workforce. If a layoff is indefinite or exceeds the ESC limits, it may be treated as a termination triggering notice obligations.

Each of these concepts deserves its own detailed treatment. This post focuses on wrongful dismissal in the conventional sense: a termination without adequate notice.

Termination With Cause vs. Without Cause

What Just Cause Actually Means

Termination “for cause” allows an employer to dismiss an employee immediately, without notice or severance. But just cause is an extremely high legal bar. Courts have consistently described it as the “capital punishment” of employment law. The threshold is not whether the employer was unhappy with the employee, or even whether the employee made a mistake. The question is whether the misconduct was serious enough that it fundamentally broke the trust underlying the employment relationship, and whether immediate termination was a proportionate response.

The analysis has three steps: courts look at the nature and extent of the misconduct, the surrounding circumstances including the employee’s history, role, and the employer’s policies, and whether termination was proportionate.

Just cause requires proportionality. Even genuine misconduct may not justify immediate termination without prior warnings, particularly for employees without disciplinary history. Second, employers who fail to follow their own progressive discipline policies or investigation procedures undermine their own just cause arguments. Third, the burden of proving just cause rests entirely on the employer, and suspicion or inference is not enough.

Click here to learn more about termination for cause.

Notice Entitlements: Statutory vs. Common Law

Alberta Employment Standards Code Minimums

If you are terminated without cause, you are entitled under the ESC to a minimum notice period based on your length of service. These range from one week for employees with 90 days to two years of service, up to eight weeks for employees with ten or more years of service. Employers can also provide pay in lieu of working notice.

However, these are statutory minimums. They represent the absolute floor below which no employer can go, not a fair or reasonable settlement figure. Most employees with any meaningful length of service are owed significantly more under the common law.

Common Law Reasonable Notice

The common law entitlement to reasonable notice is determined by applying the factors from the landmark case Bardal v Globe & Mail Ltd [1960] CarswellOnt 144. Those factors are the character of the employment, the length of service, the age of the employee, and the availability of similar employment given the employee’s training, experience, and qualifications. Courts apply these factors holistically, not mechanically, to determine what notice period would give the employee a reasonable opportunity to find comparable work.

Working notice means the employer keeps you employed for the notice period. Pay in lieu means you receive your compensation for that period as a lump sum or salary continuance instead. Either satisfies the legal obligation, though the two have different implications for benefits, bonuses, and other compensation elements.

How Employment Contracts Affect Your Entitlement

Employment contracts can limit common law notice entitlements, but courts apply strict rules to such clauses. The language must be clear, unambiguous, and must not result in entitlements below the ESC minimums. Language that says entitlements will be “in accordance” with the ESC is not sufficient. The language must clearly and unambiguously reference the minimum standards as the employee’s sole entitlement.

Contracts Need to Be Updated With Your Role

If your role changes during the course of your employment, you might no longer be bound by the terms of your original contract. This is called the changed substratum doctrine. Under this doctrine, a termination clause negotiated at the time of hiring may no longer apply if the employee’s role has changed so dramatically that the original contract could not have been intended to govern it. A recent Alberta decision, Singh v Clark Builders, 2025 ABKB 3, demonstrates this will not apply if the change in employment was contemplated by the parties at the outset.

Contracts Might Not Apply if Breached by the Employer

When an employer breaches a fundamental term of an employment contract, the employee may no longer be bound by its provisions. Courts have recognized that a contract is a two-way street: if one party fails to honour their obligations, the other party should not be held to theirs. In the employment context, this matters most when employers try to rely on termination clauses after acting in bad faith, making unilateral changes to compensation, or otherwise repudiating the agreement. However, Singh v Clark Builders, 2025 ABKB 3, also clarified that this principle will not apply to every breach by an employer.

Common Law Factors in Depth

Courts determine reasonable notice by weighing the common law factors together. No single factor is determinative, and the exercise is inherently fact-specific. What follows is a practical overview of how each factor plays out:

• Age matters because older employees typically face greater difficulty finding comparable work. An employee terminated at 58 faces a fundamentally different job market than one terminated at 35.
• Length of service reflects how deeply the employee has invested in the employment relationship and how dependent they may have become on a single employer.
• Character of employment accounts for the seniority, specialization, and difficulty of the role.
• Availability of similar employment is perhaps the most fact-specific factor, requiring courts to assess the realistic prospects of finding comparable work.

These factors interact in important ways. An employee who is both older and has worked for a single employer for decades may face compounded employability challenges that push the notice period toward the upper end of the range.

The 24-Month Ceiling and When Alberta Courts Will Exceed It

Lischuk v K-Jay Electric Ltd, 2025 ABKB 460, is a landmark Alberta decision. For the first time in Alberta legal history, a court awarded a reasonable notice period of 26 months, breaking through what had long been considered the practical ceiling.

The employee in Lischuk was 58 years old at the time of termination, had worked at K-Jay for 34 years, and had effectively spent his entire career with a single employer. He had risen from labourer to General Manager and was a key employee integral to the company’s growth. The employer’s stated reason for letting him go was that his “old school mentality” was no longer a fit, which the court characterized as essentially forcing him into retirement.

“I find that the Bardal factors in Mr. Lischuk’s situation give rise to the exceptional circumstances that are necessary to award a reasonable notice period beyond the rough upper limit of 24 months. The proper reasonable notice period for Mr. Lischuk is 26 months.” (para 29)

Lischuk signals that Alberta courts are willing to align with Ontario’s approach, which requires “exceptional circumstances” to exceed 24 months but does not treat 24 months as an absolute ceiling. The decision is significant for any long-service, older employee who faces termination in circumstances that amount to a forced retirement.

What Compensation Is Included in Your Severance

Employees frequently underestimate what should be included in their severance package. The measure of damages in a wrongful dismissal claim is not simply base salary. It is what the employee would have earned had proper notice been given. You can watch this video for a complete breakdown of how your wrongful dismissal damages are calculated, but this post will explain how bonuses and benefits are incorporated into your severance package. These principles align with the recent Alberta court decision in McDonald v Sproule Management GP Limited, 2023 ABKB 587.

Bonuses

Bonuses that form an integral part of an employee’s compensation, including discretionary bonuses, are generally recoverable as part of a wrongful dismissal claim. The key question is whether the employee would have received the bonus had the employer simply provided proper notice. If so, the employer cannot simply point to the discretionary nature of the bonus to avoid liability.

That said, the specific terms of a bonus plan matter. If those terms clearly and unambiguously limit or remove the right to a bonus during the notice period, a court will take that into account. Courts will also look at what bonuses were actually being paid during the relevant period. If an employer was facing financial difficulties and paying little or nothing in bonuses at the time, that evidence can significantly reduce or eliminate a bonus claim.

Benefits

A wrongfully employee is entitled to the benefits they would have received during the notice period, including employer-paid insurance premiums, health and dental coverage, professional membership dues, and other personal perks tied to the employment relationship.

Even where an employee did not replace a particular benefit during the notice period, Alberta courts have held that the value of the employer’s premium contributions can still be recoverable. Where specific benefit values are difficult to establish, courts may apply an estimate, sometimes around 10% of salary, to capture the overall value of a lost benefits package.

Employees should keep careful track of any out-of-pocket expenses incurred during the notice period that would otherwise have been covered, as those costs can form part of a damages claim.

Mitigation: The Duty to Find New Work

Once you are terminated, you have a legal obligation to take reasonable steps to find comparable employment. This is called the duty to mitigate. Any income you earn during what would have been the notice period is deducted from your damages. If you fail to take reasonable steps and comparable work was available, your damages can be reduced even if you earn nothing.

The test has two parts: the employer must prove both that the employee failed to take reasonable steps, and that comparable employment could probably have been found. The burden falls on the employer, and any gap in the evidence benefits the employee.

Hiebert v Zimco Instrumentation Inc., 2025 ABCJ 133, illustrates how courts assess mitigation in a nuanced way. The employee had pivoted to a new career rather than searching for comparable work in his field. The court found the employer had not met its burden on either part of the test. Notably, the court gave weight to the fact that a non-competition clause had been reiterated in the termination letter, which would have had a chilling effect on the employee’s job search.

“Such clauses are intended precisely to discourage employees from going to work with competitors. While the Defendant argues the Plaintiff could have asked to be released from the Restrictive Covenant, that is entirely speculative and flies in the face of the fact that its terms were reiterated in the Termination Letter.” (para 148)

Hill v Canyon Dental Centre Ltd., 2025 ABCJ 163, reached the opposite conclusion. Over more than a year, the employee contacted only 19 potential employers, missed months with no search activity, did not register on major job platforms, and applied for just 4 of the 133 comparable positions the employer identified during her notice period. The court found she had failed to mitigate and reduced her notice period by two months.

“An employee does not have to immediately start a search for employment upon termination… However, at some point, an employee must commit, focus and take steps to address one’s duty and obligation to find replacement employment.” (paras 26-27)

The practical lesson: document your job search carefully. Keep a log of applications, rejections, and relevant market conditions. Do not wait months before starting. At the same time, you are not required to accept a position that is substantially inferior to your former role.

Aggravated and Punitive Damages

In most wrongful dismissal cases, damages are limited to the notice period. However, two additional categories of damages may be available in egregious circumstances.

Aggravated damages compensate for the manner in which the dismissal was carried out. Following the Supreme Court of Canada’s decision in Honda Canada Inc v Keays, these damages require proof that the employer acted in bad faith in the manner of dismissal, causing additional harm beyond the usual loss associated with losing a job. Examples include making false allegations of just cause to avoid paying severance, conducting a humiliating termination meeting, or using the dismissal process as an opportunity to embarrass the employee.

Punitive damages are awarded in rare cases where the employer’s conduct was so malicious, high-handed, or reprehensible that it warrants denunciation beyond compensatory damages. The bar is high. These are not available simply because the employer was wrong about having just cause, or even because the dismissal was handled poorly.

Both remedies require careful analysis of the specific facts. If you believe your dismissal involved bad faith conduct, it is worth discussing that specifically with an employment lawyer.

The Termination Meeting and What Happens Next

Being let go is one of the most stressful experiences a person can face. The moments immediately following a termination are critically important from a legal standpoint. Here is what you need to know.

Do not sign anything at the termination meeting. Employers routinely present severance agreements at or immediately after the termination meeting and may create a sense of urgency. You are never legally required to sign immediately. You have time to review the offer and, more importantly, to get independent legal advice before accepting.

The limitation period for a wrongful dismissal claim in Alberta is two years from the date of termination. While this gives you time to consider your options, do not wait too long. Evidence can become harder to gather, witnesses move on, and legal advice is most useful when sought early.

Note every detail you can remember about the termination meeting: who was present, what was said, whether a reason was given, and whether just cause was alleged. If benefits coverage is being cut off, flag this immediately.

Human Rights Considerations

Wrongful dismissal and human rights law sometimes overlap. A termination may be both a wrongful dismissal and a discriminatory act under the Alberta Human Rights Act or the Canadian Human Rights Act for federally regulated employees. Protected grounds include race, colour, ancestry, place of origin, religious beliefs, gender, age, physical disability, mental disability, family status, marital status, and sexual orientation, among others.

Yee v WestJet, 2025 ABCJ 87, addressed an important procedural question: whether a court has jurisdiction to hear a wrongful dismissal claim where the underlying facts are substantially based on an allegation of religious discrimination and failure to accommodate. The court rejected the employer’s argument that the claim belonged exclusively before the Canadian Human Rights Commission, finding the claim was properly framed as a wrongful dismissal action grounded in breach of contract.

“Even if the Court cannot deal with allegations of discrimination per se, they may be relevant to issues of the wrongfulness of the dismissal, length of reasonable notice, and aggravated and punitive damage claims.” (para 44)

If your termination may have involved discrimination, it is worth discussing both avenues with an employment lawyer to understand which forum best serves your interests.

Special Situations

Long-Service and Older Workers

As the Lischuk decision demonstrates, employees who have worked for a single employer for many years and face termination at or near retirement age occupy a special position in wrongful dismissal law. The combination of advanced age, long service, and limited transferable skills can justify notice periods at or above the conventional ceiling.

Casual Employees

Whether an employee is “casual” or regular affects their entitlement to reasonable notice. Falkenberg v Stephen Avenue Securities Inc, 2025 ABKB 485, is an instructive case. The court applied a multi-factor test that looked at the nature of the duties, degree of workplace integration, whether there was a regular schedule, benefit enrollment, and the expectations of the parties.

“The term ‘casual employee’ has no precise definition at common law… Whether an employee is a casual employee or not is a fact specific determination that must be made on a case-by-case basis.”

The court found that an employee whose role was a regulatory requirement for the business to operate, who performed integral ongoing duties, and who was enrolled in benefit plans was not casual, regardless of salary fluctuations. Part-time is not the same as casual.

Employer Counterclaims

Garbage King Inc. v Voth, 2025 ABKB 661, involved an employer seeking an injunction against a former employee it claimed owed fiduciary duties and had breached them by starting a competing business. The court denied the injunction at the interim stage, but the case illustrates that employment litigation can become multi-directional, particularly for senior employees or those with non-solicitation obligations.

How to Pursue a Wrongful Dismissal Claim

If you believe you have been wrongfully dismissed, the process typically follows a predictable path.

The first step is usually a demand letter, setting out your legal position and your entitlement to notice. Many cases resolve at this stage through negotiation without the need for litigation. An employment lawyer can prepare this letter and guide the negotiation.

If negotiation fails, the next step is litigation. In Alberta, claims for reasonable notice are pursued in either the Court of King’s Bench or the Alberta Court of Justice. The Court of Justice has a monetary limit of $100,000. For higher-value claims, or claims involving complex issues, the Court of King’s Bench is the appropriate forum.

Litigation proceeds through the filing of a statement of claim, document disclosure, questioning, and, if the case does not settle, trial. Most wrongful dismissal cases settle before trial.

The limitation period for a wrongful dismissal claim in Alberta is two years from the date of termination. Missing this deadline will extinguish your claim entirely.

Why You Should Get Legal Advice Before Signing Anything

The single most common and costly mistake employees make after termination is signing a severance agreement without getting legal advice first. Employers present these agreements under time pressure, and the figures offered are routinely lower than what the employee is actually owed.

The gap between an initial offer and a proper entitlement can be significant. An employee offered two months of salary who is actually entitled to twelve months of total compensation including overtime, benefits, and bonus is being asked to waive ten months of income they are legally owed. Signing that release forecloses your ability to recover the difference.

If your employer has imposed a deadline for signing, you can respond in writing to indicate you are reviewing the offer with legal counsel. A reasonable employer will accommodate a short extension for that purpose. An employer who refuses to allow any time for legal review is itself a warning sign.

For personalized advice, an employment lawyer at Cashion Legal can help you understand what you are owed.

Conclusion

Wrongful dismissal law in Alberta is not static. Courts continue to develop and refine the principles governing what employees are owed when they lose their jobs. The decisions discussed in this post, drawn from 2025 and 2026, illustrate that those principles are alive and actively applied in ways that can make a significant financial difference.

A few core points to take away: just cause is a high bar that employers frequently fail to meet; the ESC minimums are a floor, not a settlement target; common law notice is determined holistically using the Bardal factors; severance must account for all forms of compensation; and the duty to mitigate requires genuine effort, but the burden of proving a failure to mitigate falls on the employer.

If you have been terminated and are uncertain about your rights, the most important step you can take is to consult an employment lawyer before making any decisions. The law provides real protection for employees who know how to use it.

If you are looking for clarity, strategy, and peace of mind regarding your severance entitlements, contact us to book a consultation today.