It's a dismal fact that employment lawyers are particularly busy right after Christmas. A few trends come together to make January a popular time to dismiss employees: many employers need to cut costs around year-end, but don’t want to ruin their employees' holidays by dismissing in December. This often results in a spike in terminations in the new year.
We can't stop your employer from dismissing you, but we can advise on what your legal rights are when you find your employment terminated.
Your employment contract determines your severance pay.
Entitlement to severance pay is a contractual right, even if you have no employment contract. There are three kinds of severance pay (lawyers call it “notice” or “pay in lieu of notice”):
- Employment Standards Act minimum notice, which applies to most employees regardless of whether there’s an employment contract;
- Contractual notice, if there is a written contract containing a valid termination clause; and
- Reasonable notice, which is a term implied into any contract that doesn’t contain a valid termination clause.
You are probably entitled to the Employment Standards Act minimum severance.
Most employees in British Columbia are entitled to Employment Standards Act “statutory notice” pay. The Employment Standards Act is not the same thing as “labour standards”, and a termination clause that refers to “labour standards” may not be valid for a non-union employee.
Some employees are exempt from the Employment Standards Act – please see the list here to find out whether you're covered. If you're not covered by the statutory minimum, you may still be entitled to other kinds of severance pay.
Statutory notice under the Employment Standards Act starts at one week of severance pay for employment longer than three months and less than one year. The maximum statutory notice you may receive under the Employment Standards Act is eight weeks of notice, even if you have been employed longer than eight years.
If you are entitled to Employment Standards Act severance pay, then it does not matter what your contract says - even if the contract tries to provide less than the statutory minimum.
You might be entitled to quite a lot more than the statutory minimum severance.
If your employment contract says nothing about termination notice or severance pay, or if it tries to provide less than the statutory minimum, then the law implies a term of reasonable notice into your employment. This is the same if there is no employment contract at all. Reasonable notice is designed to protect you from the financial harm caused by sudden a termination of your employment. In British Columbia, reasonable notice can be up to 24 months of your total pay, including salary, bonus, and benefits.
Before you sign anything, you should have it reviewed by a lawyer.
Many employers will offer an immediate payment in return for your signature on a Release. Typically, the payment offered is less than your legal entitlement. By signing the Release, you are contracting to accept less than what you ought to have – and it’s often irreversible. Before you sign any termination documents, you should always have a lawyer review the severance offer and your employment contract, if you have one, to ensure you receive what you’re actually owed.
Your employer cannot require you to sign a Release, or anything else, in order to pay out your Employment Standards Act severance pay.
If you've been dismissed from your employment, learning your rights and options is an investment well worth the time and cost of speaking with a lawyer. We offer initial consultations at a reasonable fixed fee. Please call our office today and book an appointment to learn more about your rights.
About the Author: Julianne Yeager advises employees on all aspects of their workplace rights, during and after employment.
