The OCA said Meta cannot alter employees’ compensation scheme during their termination notice period
A former Meta employee is entitled to US$4.7 million in restricted stock units that should have vested after the company told him he was fired, the Ontario Court of Appeal has ruled.
The appellate court’s Aug. 7 decision represents a victory for the employee, University of Toronto professor Daniel Wigdor, who began working for Facebook Canada as a research director in 2020 before the company fired him at the end of 2023. A lower court had previously found that Wigdor was not entitled to the RSUs.
RSUs are a form of compensation offered by some companies, which guarantee employees shares of the company’s stock once they meet certain conditions, like working for the company for a specified amount of time. At Meta, RSUs are vested in quarterly increments over a four-year span, but have no value before they vest.
Under Meta’s policies, employees immediately forfeit all their unvested RSUs when they are fired. The policies state that no vesting occurs during the notice period after an employee has been notified they will be terminated, but has not yet stopped working for the company.
However, the OCA found that Meta’s rules on RSUs for terminated employees violate Ontario’s Employment Standards Act. The ESA includes minimum standards for how companies must treat employees once they’ve been fired. One of these standards concerns the minimum notice period employers must give employees they plan to terminate, which varies depending on how long the employee has worked for their employer.
Under s. 60 of the ESA, employers additionally cannot alter employees’ terms of employment, including their wages, during the notice period. Employers must also continue paying the same wages and benefits until the end of the notice period. S. 61 of the ESA meanwhile allows employers to fire an employee with less notice, but only if they pay out a lump sum equal to the amount of money the employee would have earned during the notice period.
The OCA said that by stopping continued vesting of RSUs during the notice period, Meta’s policies for RSUs unlawfully “purport to alter a term or condition of employment” during that period. Because of this, the appellate court concluded that the policies “are contrary to the ESA, void, and incapable of contracting out of common law notice entitlements.”
Common law dictates a longer notice period than the ESA – typically between three to 24 months. However, employers in Ontario can opt to “contract out” of the common law notice period and replace it with a notice period of a length of their own choosing, as long as it meets minimum ESA standards.
In a statement Monday, Meta spokesperson Julia Perreira told Law Times the company disagreed with the OCA’s ruling and was considering its options.
“Our employment agreements, including equity awards, are consistent with Canadian law,” Perreira said.
But Alysha Shore, one of the litigators at Paliare Roland who represented Wigdor, said Friday’s decision sheds light on an important issue.
The OCA’s ruling “clarifies that employers cannot alter terms or conditions of employment, which include employee equity plans, during the statutory notice period, regardless of whether they elect to provide working notice under s. 60 or pay in lieu of notice under s. 61 of the ESA,” Shore told Law Times.
“A failure to comply with the ESA, including in the termination provision found in an equity plan, can result in that provision being struck and the employee’s continuing to participate in the equity plan during the reasonable notice period,” she added.
Wigdor began working for Facebook Canada nearly a decade after he founded Chatham Inc. to provide tech consulting services for financial, legal, and tech firms. When he sold Chatham to Meta in 2020, the tech giant integrated Chatham’s employees into its own workforce, including Wigdor, who became a Meta employee with a starting base salary of $232,000. He was entitled to RSUs on top of his salary.
When Meta fired Wigdor three years later, the company gave him severance pay and opted to give him a lump sum – eight weeks of earnings – in lieu of notice. The company told Wigdor if he signed a release, he would receive more benefits. However, Wigdor declined to sign the release because it included a clause that barred him from challenging the forfeiture of his unvested RSUs.
Nearly a year later, he sued the company, arguing it delayed paying him the lump sum and severance pay for months to pressure him into signing the release.
In July 2025, the Ontario Superior Court of Justice found that Meta should have given Wigdor 10 months of common law notice, as well as a lump sum and severance pay for that notice period.
However, the trial court found that Wigdor was not entitled to his unvested RSUs because Meta had paid him a lump sum in accordance with s. 61 of the ESA, which, unlike s. 60, does not explicitly ban employers from altering any “term or condition of employment” during a notice period.
Wigdor appealed the RSUs finding with the OCA. Meta meanwhile cross appealed.
The OCA dismissed Meta’s cross appeal, and sided with Wigdor. The appellate court said the trial court’s conclusions about the RSUs were wrong because they were based on the court reading ss. 60 and 61 “disjunctively” instead of together.
“The context of reading ss. 60 and 61 together supports that the entitlement to pay in lieu of notice in s. 61(1)(a) incorporates the obligation in s. 60(1)(a) that an employer may not alter terms or conditions of employment during the statutory notice period,” the appellate court said.
