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Severance Pay Entitlement

There are several kinds of compensation you can receive upon dismissal. One of these is severance pay. Not all employees have this entitlement. The purpose of severance pay is to recognize the long-serving employees. As a result, the employee receives additional pay after dismissal. Employees are normally entitled to receive severance in addition to any termination pay or vacation pay they may be entitled to in a termination without cause scenario. Furthermore, severance pay is different from termination pay and pay in lieu of notice. You should retain a wrongful dismissal lawyer to ensure you know your rights.

There are some instances when you do not qualify notwithstanding your dismissal. You should not make and rash decisions after your dismissal.

Other law firms’ websites offer basic severance pay calculators which allow an employees to guess what they may be entitled to. We chose not to have a severance pay calculator as it may be inaccurate and misleading.

Some questions to think about in determining appropriate severance pay or what the call calls reasonable notice of termination are the following:

  1. The employee’s age
  2. The length of employment
  3. The nature of employment
  4. Was the employee induced to leave a secure position?
  5. Does the employee have a valid contract of employment that would limit what they would otherwise be entitled to?

In any event, If you have any questions you should contact Ken has over 28 years of experience. He is happy to discuss your case with you.

Legislation governing severance pay

Section 64.(1) of the Employment Standards Act governs:

64.(1) “An employer who severs an employment relationship with an employee shall pay severance pay to the employee if the employee was employed by the employer for five years or more and,

(a) the severance occurred because of a permanent discontinuance of all or part of the employer’s business at an establishment and the employee is one of 50 or more employees who have their employment relationship severed within a six-month period as a result; or

(b) the employer has a payroll of $2.5 million or more.”

If you have received a termination letter, and are not sure to severance pay you may be entitled, you should consider consulting an employment lawyer. You may have been wrongfully dismissed and you may be entitled to sue for various compensation including pay in lieu of notice and severance pay. It is important not to confuse severance pay with termination pay, or pay in lieu of notice. Your best bet is to get legal advice. Do not listen to friends. Do not rely on an internet search. Talk to an employment lawyer.

Severance Pay and the Employment Standards Act

A common resource used to get an idea of what severance pay an employee may be entitled to is the tool found at the Ontario Ministry of Labour website. Also, this tool allows you to get an estimate of your entitlement if any. In addition, there are sample severance pay calculations which are very useful.

It is very important to note that the tool is only a guide and you may actually be entitled to a lot more damages in addition to severance pay if you pursue a wrongful dismissal action in Superior Court. Hence, it is advisable to speak with an employment law lawyer before accepting an offer in a termination letter. Even if your employer alleges that there was cause to dismiss you, it is important to understand your rights. Additionally, you may have a valid wrongful dismissal action against your former employer.

The information on this website is for informative purposes only. It is not legal advice. Furthermore, you cannot retain a lawyer without a consultation. Finally, if you need a wrongful dismissal lawyer, call me at: 416 323 3614