frequently asked questions
Employment and Wrongful Dismissal Claims
If you or someone you know has experienced a wrongful dismissal, our wrongful dismissal lawyers are here to help. We fight hard to ensure that our clients receive full compensation. Our preference and strategy is to try to negotiate a settlement without litigation. This is often possible, and matters can resolve very quickly, sometimes within a few weeks. Where litigation is necessary, however, we are strong and efficient, and we are widely respected by the legal community for our fierce advocacy and our refusal to back down.
When you are terminated, your employer may offer you an exit agreement to sign. They may also offer you a severance package, with a very short deadline attached. Do not sign anything before speaking to an employment lawyer.
Do not be pressured by your employer to accept severance pay before consulting an employment lawyer. They cannot legally impose a deadline on your full severance entitlements. You have two years following termination to pursue your severance pay. Once you sign a severance offer from your employer, you have signed away your right to sue for severance pay under common law, which might be a difference of tens of thousands of dollar, depending on various factors.
Each case will vary in the amount of severance that employers are required to pay employees upon termination. Many factors will determine the amount including: age, salary, length of service, employability, benefits, commission, bonuses, allowances, pension plans, stock options, and more things. Contact an employment lawyer to work with you to determine an appropriate amount to ask for.
If you have been with the same employer for at least 12 consecutive months, you may be entitled to sue your employer for using false accusations to fire you.
Constructive dismissal occurs with a substantial, unconsented change to your employment and may include: Significant reduction in compensation; demotion; creation of a hostile work environment; change in work location; or suspension.
Employers have to provide advance warning to employees that their employment is going to be terminated otherwise it is a wrongful dismissal. However, employers can just pay employees money in lieu of advance warning of termination. “Severance” also known as “reasonable notice”, “pay in lieu of notice” or “termination pay” is this amount of money provided in lieu of advanced warning.
If the employer does not give the employee enough severance in Ontario, it is a “wrongful dismissal”.
Severance is measured in two different ways: statutory severance and common law severance. Employees can be entitled to both statutory severance and common law severance. All employees are generally entitled to statutory severance. However, some employees are not entitled to common law severance. Some employees have employment contracts that contain termination clauses which take away the right to common law severance.
Common law severance is generally much more lucrative than statutory notice.
Even if an employment contract limits common law severance by way of a termination clause, an employment lawyer at Dutton Employment Law may be able to strike out that termination clause as unenforceable. Call us to find out more.
Statutory severance is the minimum amount of pay that an employee must receive according to laws made by the government.
Employees must receive 1 week of statutory severance for every year of service as per the Ontario government Employment Standards Act. For example, an employee who has worked for 8 years must receive 8 weeks’ statutory severance otherwise it is a wrongful dismissal in Ontario.
It is always a wrongful dismissal if the employer provided the employee anything less than minimum statutory severance.
Common law Severance is the amount of money an employer must pay a terminated employee according to judge made “precedents”.
Common law severance is the formula for termination pay based on “precedents”, or similar cases from Canadian courts. Calculating common law reasonable notice is an art, not a science. There is no formula like there is for statutory severance. It is not true that employees are usually awarded 1 month common law severance for every year of service. In reality, many employees get much more than 1 month’ common law severance for every year of service.
Calculating common law severance revolves around one key issue: how much time will it take the terminated employee to find comparable employment? Judges usually answer this by examining four non-exhaustive factors:
- the character of employment;
- the length of service;
- age; and
the availability of similar employment while having regard to experience, training and qualifications. Therefore, common law severance can vary widely depending on the circumstances. For instance, a Vice President of a bank, who worked for the bank for his entire career, who is 75 years old, and whose high-level skills only apply to positions at just a few other banks would receive the maximum amount of common law severance – around 26-28 months severance otherwise it is a wrongful dismissal. This is because it is virtually impossible for the former Vice President to find comparable employment, considering:
- any job less than VP would be inappropriate;
- his long service with a single employer has tainted him;
- his age is a barrier for the long term plans of another employer; and
- and there are few similar employers in the country, so his pool of target employers would be minuscule.
Whenever we get a new prospective client, we ask them a series of questions reflecting the four factors noted above (age, salary, years of service, etc…). Thereafter, we compare their answers with a special database of precedents from thousands of Canadian court cases to determine what common law severance they are entitled to. If we determine that they were not provided enough severance, then we know that they have been wrongfully dismissed.
Unless the employment contract states otherwise, it is an Ontario wrongful dismissal if the employer offered anything less than maximum severance according to the common law.