When it comes to severance pay, many Albertans are not aware of their legal entitlements when they lose their job.
I get questions about severance every day through the EmploymentLawyer.ca site, the Employment Law Show on radio and TV, and my firm’s weekly livestreams. Often the questions are from people who have just been fired from their job and are trying to figure out if they are owed anything and, if so, how much they should receive.
Here are the 10 most common questions that non-unionized employees in Alberta have about severance packages.
Is severance pay mandatory in Alberta?
Severance pay is mandatory if your employment is terminated without cause. In this type of termination, your employer can let you go for many reasons, so long as they aren’t discriminatory. For example, the company can fire you because they feel that you aren’t the right fit for the role, but they can’t let you go because of your age, race or gender.
You are also entitled to a severance package if changes are made to your job that you choose not to accept. This is legally referred to as a constructive dismissal.
Am I owed severance if I am terminated for cause?
You are not entitled to severance if you are fired from your job for cause. But most employers incorrectly or prematurely apply the “for cause” label to situations that don’t warrant it.
“For cause” termination is reserved only for the worst workplace offences, such as theft, insubordination or assault. It does not apply when an employee shows up late to work once or twice, or fails to meet a new sales goal.
I tell clients not to accept a termination for cause. An employment lawyer at my firm can review your dismissal at no cost to determine if it is legitimate and if severance is still owed.
How is severance pay calculated in Alberta?
Severance for an employee is influenced by many factors: your age, length of employment, position or job title, and salary (including any bonus or commission), as well as the availability of similar employment. We refer to this as “common law” severance in the legal industry. The end result can be as high as 24 months’ pay, and applies to all non-unionized workplaces and positions within a company.
The Alberta Severance Pay Calculator, which my firm developed, can help you better understand what you may be owed. You can also find more resources on severance pay on the Samfiru Tumarkin LLP website.
Should I contact Employment Standards in Alberta to get severance pay?
You should not contact Employment Standards for assistance with severance. The provincial government will only help you get the minimum entitlements mandated by the Employment Standards Code (ESC).
An experienced employment lawyer can help you get your full and fair common law severance, which is often much more than the minimum amount dictated by the ESC.
Can I get severance if I’m a contractor?
Contractors and independent contractors traditionally do not get vacation pay, sick leave, benefits or severance. But amid the rapid expansion of the gig economy, many employers have misclassified employees as contractors. For example, my firm filed a class-action lawsuit against Uber for this practice.
This means many contractors are actually owed full severance pay when they are let go or their contracts are terminated, because they are, in fact, employees.
An employment lawyer can establish a person’s true working relationship with a company by reviewing a number of criteria established by our courts. I also developed the Pocket Employment Lawyer to help workers determine whether they are a contractor or employee, and what their rights are in either case.
Do I get severance if I only worked at the company for a short time?
Many people assume that you must work many years at a business to be eligible for a large severance package — or any severance at all. Employers often believe that they can release an employee who has only been with the company for a year or two with only a few weeks’ pay.
But in legal proceedings, short-service employees often get disproportionately larger severance payouts than employees who have served with a company for many years.
Do I get severance if I am a part-time employee?
You are still entitled to severance if you work part-time hours. Hours worked is only one factor in determining a complete severance package.
How does an employment contract affect my severance?
Employment contracts can be written to include a termination clause that attempts to severely restrict severance pay. But these termination clauses are often invalid or illegal.
If you are terminated and your employer is pointing to a termination clause to try to withhold severance pay, contact an employment law firm like Samfiru Tumarkin LLP immediately for a free consultation. Employment lawyers will review your contract and ensure you get the severance pay you’re owed.
Do I have to sign a severance offer by the employer’s deadline?
You don’t have to accept a severance agreement by your employer’s deadline. Many employers use deadlines to pressure employees into signing away their rights to fair severance. They want you to sign an offer before having it reviewed by an employment lawyer, who may discover that you are owed much more.
Once you sign and return an offer, it cannot be undone. But if you don’t sign by your company’s deadline, by law you have two years to file a claim against your former employer for severance.
Do federally regulated employees get severance pay?
Much like provincially regulated employees, all workers in federally regulated businesses, such as banks, transportation and broadcasting, are entitled to full severance pay.
Have you been let go from your job? Are you trying to properly calculate your severance package?
Contact the firm or call 1-855-821-5900 to secure assistance from an employment lawyer in Alberta, Ontario or British Columbia. Get the advice you need — and the compensation you deserve.
Lior Samfiru is an employment lawyer and partner at Samfiru Tumarkin LLP, one of Canada’s leading law firms specializing in employment law and disability claims. He provides free advice as the host of Canada’s only Employment Law Show on TV and radio.