Short-Term Canadian Severances

Short-term layoffs can often be much more devastating than long-term ones. However, an employer typically has no right to terminate or lay you off during probation without proper pay or notice unless they have just cause. This must be mentioned because many employers will lay off or terminate their employees without informing them they're entitled to severance. Though several employers are genuinely unaware of this, plenty are aware and will keep it from you out of sheer greed. Some employers will also offer severances that they know are considerably smaller than what a court would order and ask you to sign a contract that forfeits legal rights to ask for a larger one.

Now, there are some cases where this isn't correct. Still, typically, unless there is a particular clause in your employment contract that says you can be fired at any time for any reason without severance or your region has legalized employment at will (the ability to fire someone at any time for any reason), your employer cannot terminate you without good cause and must give you notice or severance. This is because employees are still protected under common law. While the government legislates statutory law, common law is judge-made law created over years and years of decisions by the courts. Imposing such a layoff can expose an employer to significant liability for constructive dismissal without an enforceable employment agreement that says otherwise or the employee's consent.

The purpose of common law notice is to give employees who are let go the time they need to find a new job. Depending on numerous factors, a judge can decide this to be weeks, months, and even years. It is implied that all Canadian employees are entitled to common law notice of termination unless an employment contract has an enforceable termination clause. In Canada, the maximum common law notice is typically 24 months, and the minimum is usually no less than three months. However, the courts have the discretion to increase the past 24-month threshold.

What is Just Cause?

A good reason does differ depending on the court, but just cause typically constitutes continuous infractions or an especially major one. Just cause typically constitutes serious 'misconduct,' which incorporates a wide range of actions, including theft, dishonesty, acts of violence, chronic absenteeism, unscheduled absences, misuse of company assets, sexual harassment, and social media activity.

The facts and circumstances surrounding the misconduct must be examined carefully. Each case is different. The employee's position and length of service must be considered. Personality conflicts, general dissatisfaction with the performance, petty issues, or one incident of inappropriate behaviour or misconduct are usually not severe enough for a cause to terminate without notice. In these instances, corrective action would have been more appropriate. Employers must provide employees with a reasonable opportunity to make the improvements or changes needed to retain employment. Employers who do these things have a better case for just cause.

Employers who condone or ignore misconduct may be prevented from claiming that the dismissal was for just cause. Condonation means that the behaviour has been largely left unaddressed. Employees must be warned that their behaviour will lead to termination if it is not corrected, and they must be provided a reasonable opportunity to correct their behaviour.  Otherwise, employers won't have a strong case not to provide notice or pay instead of notice, as the employee would not have been made aware that their behaviour was unacceptable.

Even if notice is provided, an employer is not allowed to terminate an employee for a reason protected under the Act. Protected reasons in various sections of the Act include filing a complaint, reporting an offence by the employer, illness or injury, requesting modifications or reassignment of job duties to accommodate a disability, requesting a leave, pregnancy, or demanding compliance with the legislation.

Severance

There are a number of factors that go into calculating severance. A big factor is employability. This takes into consideration the employee’s education, the demand for their skills or trades, the local economy, and a host of other factors. In these criteria, one needs to only think of a hard-working and loyal employee without a grade 12 education who slowly climbs the ranks within his company only to be terminated. The probability of this same employee being able to replicate those achievements with a different employer in today's economy would be challenging, to say the least. However, the good news is that the courts will take this into consideration to make more merciful judgements.

 One may also think of someone who's extremely specialized but where few opportunities for employment exist in that area of the province. If that employee loses his job, the chances of finding comparable work in that same area could be limited. In assessing damages for wrongful dismissal, lawyers and judges will consider all these factors and will apply them to the facts of each case.

Contrary to what many believe, short-term employees can be entitled to large severances. Employers assume things like, "She was only here for a couple of months, so we'll give her two weeks of severance, and that will be more than enough". However, short-service employees who are older, in senior roles, or were recruited away from a secure job can be entitled to substantial severance.

For example: Dalton v. Fraser Valley Fire Protection Ltd., in which the employee worked for a grand total of three days before being dismissed and was awarded three months' severance. The court focused on the employee's age (70) and the limited availability of similar employment to reach this conclusion. As mentioned, a probationary period is not automatically implied in every employment relationship. While most employment standards legislation allows for dismissal without notice in the first 90 days, the common law supersedes this and requires reasonable notice at any time. In Dalton, the employer tried to argue that the individual was in his probation period, but this was rejected by the court, which found that there was no clear term in his contract that allowed for dismissal without notice.

Another huge factor that goes into calculating severance amounts is the reference employers provide. Smart employees will incorporate a positive reference requirement in their severance agreement. Predatory employers tend to remain so even following a dismissal and pose a greater risk of providing negative references. This could be added as grounds for punitive or other damages in a wrongful dismissal case and the reason to reward more months of severance. Some courts have found that denial of a deserved reference is cause for greater damages for wrongful dismissal. For the same reason, if established, a reference that creates more difficulty in obtaining reemployment is why a court will increase the severance.

Conclusion

As someone who's been through wrongful terminations and layoffs, I can tell you how devastating it can be not to know your rights. I called employment standards and looked for employment legislation online, which seemed to suggest that I wasn't entitled to any warning or pay. However, upon further investigation, I discovered that I could be entitled to a large amount since I was a high-performing employee and received no reference after leaving due to the complaints I made.

 Many people who experience layoffs are in industries with low-paying jobs and may have to wait several months to find new employment. I was lucky enough to have learned my rights; however, there are tons of people around the world who are not informed about their rights. Considering how poor and intellectually disadvantaged these people often are, it has become a humanitarian crisis. My goal is to use memes and put up informative stickers on the street so that exploited people have a fighting chance at knowing their worth and rights.

I must warn you that the legal system is complicated for people unfamiliar with it. I also encourage you to contact a lawyer because laws may change depending on your region. Many places have pro bono law firms that provide free legal services to people with specific low-income requirements. I hope that you can join the side of compassion and mercy and stick up for your fellow coworkers who are put into situations like this. Sometimes reaching out to them and offering a reference or bearing witness to their side of the story can be a saving grace in cases where employers try to escape punishment. You could also be entitled to sizeable wrongful dismissal and whistle-blowing damages if you are terminated for informing your coworkers about their rights. There's no need to feel guilty about claiming these damages because it's your employer's job not to undermine your rights. Plus, it hurts our economy when businesses that don't follow these rules are allowed to dominate the market. So go out there and be an agent of a higher law.