Were You Offered A Severance Package By Your Toronto Area Employer?
When an employee is terminated, he/she is typically asked to sign a Full and Final Release in exchange for the severance payment.
If the employer is paying the minimum statutory amounts only in accordance with its statutory obligations under the Ontario Employment Standards Act, 2000, the employee is not required to sign a Full and Final Release. Most employees are not aware that their rights upon termination are far greater at common law than their statutory rights under the Ontario Employment Standards Act, 2000 or the Canada Labour Code (the latter if employed by a federally regulated employer such as a Bank.)
When an employee is wrongfully dismissed, he/she is entitled to damages at common law. An employee would be wise to consult with an experienced employment lawyer upon being terminated. The employee will often be unaware of the extent of his/her legal rights.
Severance Package Review
Straight Forward And Honest
During the course of a Severance Package Review, the employment lawyer should be asking you a number of detailed questions about your circumstances. The employee does not always know what information is important or what is relevant.
It is our role to know what information we require and to know what questions we need to ask the employee. There may be facts such as the employee was solicited away from a secure employment position to join the new employer which may increase the severance package.
Similarly, the employee may not know his/her rights under the Ontario Employment Standards Act, 2000 and therefore, sign off on a severance package having only received an additional 2 weeks’ pay to what he/she was statutorily entitled to. ie. the employee was automatically entitled to 8 weeks’ termination pay and 8 weeks’ Severance Pay under the Ontario Employment Standards Act, 2000 (and didn’t know this) and signed a release in exchange for 18 weeks which is only an additional two weeks’ pay above his/her statutory entitlements.
When an employee is wrongfully dismissed, the employee is entitled to damages at common law and the damages are calculated based upon the reasonable notice period. The common law is based upon contract. Irrespective of whether there is a written employment contract or not, the employment relationship is viewed as a contractual one. As such, when an employer terminates an employee without cause, the employee is entitled to reasonable notice or pay in lieu of reasonable notice.
What is the Reasonable Notice Period?
The Reasonable Notice Period is considered the length of time that it will take you to find a comparable job.
Is Reasonable Notice the same for all employees with the same job?
The reasonable notice period is determined by a number of key factors including: Type of Job; Length of Service and Age. Let’s assume two scenarios where all factors are the same except Age. In situation A, the employee is 60 years of age and in situation “B”, the employee is 45 years of age. With all factors the same except “age” – the employee who is 60 years of age will be entitled to a much longer notice period (or severance pay in lieu thereof) than the younger employee.
Similarly, two employees with all factors the same except employee A holds a senior management position earning $190,000.00 will be entitled to a much longer reasonable notice period than employee B in an administrative level position earning $60,000.00.