One size does not fit all when it comes to a termination

By Tony Poland, LegalMatters Staff • Employees who have been terminated can be overwhelmed by the process, which is why it is prudent to seek advice to avoid making a costly mistake, says Toronto employment lawyer Jeffrey M. Andrew.

Employment laws can be confusing, says Andrew, and there is no one size that fits all when it comes to determining severance entitlement.

“It’s important not to sign anything or agree to anything but to get legal advice because the details matter,” he tells LegalMattersCanada.ca. “Lawyers will know how to assess a termination package, what’s appropriate for your position, your age, and years of experience.”

Andrew, a partner with Cavalluzzo LLP, says the process differs from unionized workers to non-union employees.

Union protection

Employees protected by a union can seek arbitration to retain their job if they have been dismissed. Such is not the case for non-union workers.

“If you are in the federal sector, the Canada Labour Code gives an adjudicator the right to reinstate you but it is not a remedy that is awarded very often,” he says. “For most employees covered under provincial law, if you are terminated the courts don’t reinstate you. You are out the door. So, what you are talking about then is a severance package.”

Andrew says in situations where non-union workers are called into a meeting to be terminated, the employer “has already made up their mind so you are not going to argue them out of it.”

“It’s usually best not to lose your temper, listen to what they say and take notes if you can,” he says. “If not, write down what was said later. Listen to them. If they are offering you a package take it with you and get legal advice.”

Whether unionized or not, workers who have been laid off or terminated without cause are protected under the Employment Standards Act (ESA) if they have been with the employer for at least three months, Andrew explains.

Notice of termination

He says dismissed workers are entitled to notice of termination.

“ESA notice depends on how long you have been working there and varies from one week to eight weeks, though there can be more when a mass layoff happens” says Andrew. “It’s advanced notice and in the advanced period the employer must maintain whatever benefits you had been receiving.”

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He says it is not uncommon after being fired to be immediately ushered out the door. But you are still entitled to that advance notice so the employer must pay you and maintain your benefits during that period under ESA provisions.

That’s not all a non-union worker is entitled to, says Andrew.

“There is also the common law, where the courts impose higher standards as long as your employment contract does clearly not limit you to the ESA. This is determined by such factors as your position, your length of service, your age and how difficult it would be to find new work,” he says. 

Andrew says there are misconceptions when it comes to employee rights in a termination. For example, some assume a worker is entitled to approximately one month of severance per year of service “but courts do not officially recognize” that, he says.

‘Quite complicated’

“Depending on your length of service it can get quite complicated,” says Andrew. “I will often ask people about their health, are they on family benefits and if there is anyone in their family who needs their benefits. It is something that can be factored into what they are entitled to claim.”

He says severance packages can vary and are not always fair.

“Some employers are not well informed about their legal obligations and will lowball the employee,” Andrew says. “Others who are aware of their responsibilities often estimate what the range is and typically offer a package at the lower end of the scale, sometimes under.”

He says a terminated worker should not rush into agreeing to a service package, adding that a “smart employer” will tell you to examine the package before signing off.

“You should always check if you have received a fair package,” says Andrew. “Every well-drafted release has a section at the end stating that you have been afforded the opportunity to seek independent legal advice. Once you sign on the dotted line in most cases, you are locked in.”

He also says seeking legal advice can assist in properly structuring the settlement.

Minimize the tax burden

“Although we may not be tax lawyers, we can suggest options to try and minimize the tax burden,” Andrew says. “These are things that are in your interest to know about.”

He says if the employer is asserting cause in the termination of a non-unionized worker “it is usually best not to acknowledge anything but rather listen and then seek legal advice.”

“If you are unionized you will have a union representative involved and you can grieve the termination,” says Andrew. “In a unionized environment if you are being fired and you know you’ve done something wrong it’s best to apologize or acknowledge that. The sooner you do that the better it is for you. If you go to arbitration and you’ve acknowledged your conduct, that can help you to get your job back.”

He says workers who believe they are facing dismissal should start keeping records.

“Take notes of what people say. Are there emails you can print out legitimately that protect your position? As long as it is not a breach of privacy or a breach of confidence or misuse of proprietary information you are within your rights,” says Andrew.