Matthews and bonus damages after dismissal

In Matthews v. Ocean Nutrition Canada Ltd., 2020 SCC 26, the Supreme Court restored compensation that included an incentive payment triggered during the employee's reasonable notice period. Mr. Matthews had been constructively dismissed, and the plan wording did not remove the entitlement in the circumstances.

The long-term incentive plan was connected to a realization event, including a sale of the company. After Mr. Matthews left in circumstances amounting to constructive dismissal, a sale occurred within the reasonable notice period. The Court considered the compensation he would have received had proper notice been given, then examined whether the plan removed that entitlement clearly. This was a damages analysis grounded in the particular employment relationship and plan, not a general guarantee of every payment that follows departure.

The decision directs attention to what compensation would have been earned during the reasonable notice period and whether the plan unambiguously limits that entitlement. It does not give every dismissed employee a bonus regardless of the contract. For an Ontario termination assessment, preserve the employment agreement, incentive plan, amendments, and relevant payment history. Claim value, forum, and any statutory or contractual limits still need review. Larger or complex dismissal matters may require an employment lawyer.

For an employee, gather the plan, all amendments, communications about eligibility, previous payments, and relevant event dates. For an employer, review the actual exclusion wording against the legal framework rather than relying only on a phrase requiring active employment. Keep the notice-period question distinct from the plan-interpretation question, since both can affect the result. Statutory entitlements, mitigation, and the proper claim process may require additional assessment. A complete compensation record helps the appropriate representative evaluate the potential amount and determine whether the matter fits a paralegal retainer or needs an employment lawyer.

Sources

• Matthews v Ocean Nutrition Canada Ltd 2020 SCC 26
• Ontario guide to termination of employment

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General Ontario legal information, not legal advice for your matter, and reading it does not create a retainer. Sources checked 15 October 2026: check the current law, forms and dates before you act.

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This article is general information for people in Ontario, not legal advice. Rules, forms and deadlines change, and every situation is different. Check the current rule or speak to a licensed legal professional before you act.