Termination By Text + Lessons for Employers

The employee began working for Fluid Energy Group Ltd. (“Fluid Energy”) in 2011 and ultimately became its COO upon signing an executive employment agreement. In January 2023, Fluid Energy completed a transaction involving the sale of its core Canadian and U.S. businesses. The transaction created uncertainty regarding the employee’s role in the remaining organization.

On January 9, the employee exchanged text messages with Fluid Energy’s CEO about his future. The employee stated via text that it appeared he had been “written out” of the companies’ future plans, at least in his existing position, and that he expected his executive employment agreement to be honoured. The CEO’s response to the employee included the following statement: “You BTW wrote yourself out of this company … In any case I’m done being nice. Legal will get your package done. Turn in your laptop, key cards, etc.” The employee replied that he was sorry to hear that and would return the companies’ property. The CEO answered: “You made your bed.”

Fluid Energy argued that the text exchange amounted to a resignation by the employee. It subsequently delivered a formal termination letter to the employee alleging just cause. The employee maintained that the January 9^th text exchange had already terminated his employment without cause.

Informal Communications Can Terminate Employment

The Court ultimately agreed with the employee. Viewed objectively, the Court found that the CEO’s words and conduct constituted a dismissal without cause or a constructive dismissal. A reasonable person in the employee’s position would have understood that the employment relationship had ended. The surrounding evidence reinforced that conclusion. The companies’ Chief Legal Officer testified that the CEO instructed him that same day to prepare the employee’s termination package. The context, tone and content of the texts were consistent with a dismissal.

The legal effect of the text exchange did not depend on the CEO’s later description of what he intended. An employer’s words or conduct may repudiate an employment agreement even if the employer did not intend that result. In any event, the Court found that the evidence established that the CEO did intend to dismiss the employee through the texts and surrounding evidence.

An Ambiguous Statement is Not Necessarily a Resignation

Fluid Energy’s attempt to characterize the exchange as a resignation also failed. A resignation must be clear and unequivocal. The employee must intend to quit and engage in conduct that would lead a reasonable person in the employer’s position to conclude that the employee had acted on that intention.

The Court emphasized that the employee did not state he was quitting or resigning. Instead, he said that he appeared to have been “written out” of the companies’ future plans and expected his employment agreement to be honoured. The Court found that those statements did not demonstrate an unequivocal intention to resign. The CEO also did not ask the employee to clarify what he meant.

The surrounding circumstances matter, particularly where comments are made during a heated or uncertain exchange. An employee may express frustration, object to a change, or question whether the employer sees a continuing role for them without intending to resign.

Related Corporations Can Be Common Employers

The Court also considered whether subsidiaries of Fluid Energy, SixRing and SciencePak, could be liable for the employee’s termination under the doctrine of common employer. The key considerations were whether the related entities were subject to common control and whether they exercised control over the employee. Other relevant factors included operational integration, common directors and shareholders, services performed across the corporate group, and the parties’ intentions and dealings with one another.

The evidence showed significant integration. The entities shared a common CEO and board. The employee was directed to work for Fluid Energy’s subsidiaries, SixRing and SciencePak, and C-suite employees worked across subsidiaries. Employees were sometimes seconded among entities, while payroll costs were allocated based on work performed for the various companies.

The Court concluded that SixRing and SciencePak were the employee’s common employers along with Fluid Energy’s successor, Chemical Evolution Ltd, such that the entities were jointly and severally liable for the termination.

Key Takeaways for Employers

O’Donoghue v Fluid Energy Group Ltd. is a reminder to employers that informal communications can have significant legal consequences. A termination does not require a formal letter or meeting, and an employer may unintentionally end the employment relationship through a text, email, or other communication that objectively conveys dismissal. Conversely, employers should not treat expressions of frustration or uncertainty as a resignation unless the employee’s intention to resign is clear and unequivocal. Where there is doubt, the prudent course is to clarify the employee’s intentions before treating the relationship as ended.

The decision also highlights the importance of ensuring that corporate structure reflects operational reality. Where related companies share management, direct employees across entities, allocate payroll costs or otherwise operate in an integrated manner, more than one entity may be found liable for a termination under the common employer doctrine. Employers operating through corporate groups should therefore consider risk-management strategies to safeguard against unintended liability.

Clear advice at the outset can help avoid disputes over whether an employee was terminated, resigned, or was employed by more than one entity. Field Law’s Labour + Employment Group can assist with termination planning and communications, ambiguous resignations, and employment arrangements involving related companies. Contact Austin Ward in Canmore or Calgary and Joël Michaud in Edmonton for practical advice tailored to your workplace.

Link to decision: O’Donoghue v Fluid Energy Group Ltd., 2026 ABKB 428