Wigdor v. Facebook Canada Ltd.: Ontario Court of Appeal Addresses RSUs and Termination Compensation
The Ontario Court of Appeal has released a closely watched employment-law decision in Wigdor v. Facebook Canada Ltd., a case involving restricted stock units (“RSUs”), termination rights and compensation following dismissal.
The case matters well beyond the technology sector. For executives and other employees whose compensation includes shares, options, RSUs, bonuses or long-term incentive plans, the financial consequences of termination can substantially exceed salary and ordinary severance.
For employees reviewing an exit package, Vanguard Law’s severance package review practice considers salary, benefits, bonus, commission, equity and other compensation together.
What Happened in Wigdor?
Daniel Wigdor was a senior Facebook Canada employee whose compensation included grants of Meta RSUs.
When his employment was terminated without cause, disputes arose over both his termination entitlements and unvested RSUs.
At the Superior Court level, in Wigdor v. Facebook Canada Ltd., 2025 ONSC 4051, the court found the employment agreement’s termination provision unenforceable and concluded that Mr. Wigdor was entitled to common-law reasonable notice.
The court reached a different conclusion about the RSUs. It upheld the relevant RSU forfeiture provisions and concluded that the unvested RSUs did not continue vesting through the non-working notice period under the agreements at issue.
That combination made the appeal particularly significant: an employee could successfully challenge a termination clause governing ordinary employment compensation while still face the loss of substantial equity under a separate incentive agreement.
Why the Appeal Matters
Ontario’s Employment Standards Act, 2000 establishes minimum termination protections that employers cannot contract out of.
At common law, the Supreme Court of Canada’s decision in Matthews v. Ocean Nutrition Canada Ltd., 2020 SCC 26 provides important guidance on incentive compensation during the reasonable-notice period.
The general analysis asks what compensation the employee would have received during the reasonable-notice period and whether the governing agreement clearly and unambiguously removes or limits that entitlement.
Wigdor adds another layer: how those principles interact with separately drafted RSU agreements and the minimum requirements of the ESA.
Why RSUs Can Become a Major Termination Issue
Equity compensation is often designed to reward retention. Awards may vest monthly, quarterly or annually, meaning that the legal treatment of the termination date and notice period can determine whether substantial compensation is received or forfeited.
Three sets of documents may have to be considered together:
the employment agreement;
the employer’s equity or incentive plan; and
the individual RSU, stock-option or award agreement.
Those documents do not always use the same definition of “termination,” “employment,” “active employment” or “notice period.”
That is one reason an employee should not assume that a statement saying unvested awards are forfeited on the “last day of active employment” resolves every statutory and common-law issue.
What Employees With RSUs Should Do After Termination
Employees with equity-based compensation should obtain advice before signing a release.
A proper review may require determining which awards were granted but unvested, which awards would otherwise have vested during a notice period, what the plan says about termination, whether different award agreements apply to different grants, and whether the employment agreement itself is enforceable.
Vanguard Law’s wrongful dismissal lawyers can review salary, bonus, equity, benefits and other compensation together rather than treating severance as a salary-only calculation.
What Employers Should Take From Wigdor
Employers using equity compensation should review the relationship between their employment agreements and incentive-plan documents.
Clear drafting in one agreement does not necessarily solve a problem in another. Conversely, the enforceability of an employment termination clause may not automatically determine the treatment of rights under a separately drafted equity plan.
Vanguard Law assists Ontario employers with employment contracts and compensation terms and with wrongful dismissal defence.
Terminated With RSUs, Stock Options or a Significant Bonus?
For employees with substantial variable or equity compensation, the difference between the termination date and the end of a proper notice period can be financially significant.
Before accepting a severance package or signing away potential claims, have the complete compensation package reviewed—including employment agreements, RSU agreements, incentive plans and grant documents.
Or contact Vanguard Law to discuss your termination and compensation package.
This article provides general legal information only and is not legal advice. The treatment of RSUs, bonuses and other incentive compensation depends on the applicable agreements, legislation, case law and facts.