Every year, millions of Canadians lose their jobs — and often, they also lose out on the severance pay they’re rightfully owed.
In my experience as an employment lawyer, this is because many aspects of employment law are not well known and frequently misunderstood.
Here are five myths about terminations that many people believe and the facts behind them.
Myth: Your boss can only let you go if they have a good reason to
Fact: Your employer can fire you for any reason and at any time, so long as the reason isn’t discriminatory. It doesn’t have to be because you did something wrong.
When an employer lets you go without cause, however, they must pay you severance. I’ve spoken to many people who were terminated but not offered proper severance.
Any time an employee is let go without proper severance, they have been wrongfully dismissed. If that’s the case, you can pursue what you are actually owed with help from an employment lawyer.
Myth: When you are let go, you receive one or two weeks’ pay for every year of service
Fact: There is no “one week’s pay per year of service” rule when calculating severance pay. Severance is based on multiple factors, including age, your position or title, and length of service, which means full severance is often much more.
Severance could also be determined by your employment contract. If you signed one when you started work, check your contract to make sure it doesn’t contain any clauses that attempt to restrict your severance or termination pay.
Even if it does, these clauses may not be valid. An employment lawyer can review your employment contract and severance offer when you’re fired to see if you might be owed more.
Myth: The government will help you get all of your severance pay
Fact: The government can only help you get the provincially regulated minimum entitlement to severance, which is often only a few weeks’ pay.
Under common law, however, severance is calculated differently. Your full common law severance could be up to 24 months’ pay.
In some provinces, filing a claim with the government for severance may mean you waive your right to have an employment lawyer pursue a claim for the full amount.
Myth: Independent contractors aren’t owed severance pay
Fact: In my experience, many contractors have been misclassified and are actually employees. And if they are truly employees, they are owed severance when they’re let go or their contract is ended.
Even if you have a contract with a company labelling you as a contractor, you could still be an employee. If your employer sets your schedule, supervises your work and decides where you work, you’re likely an employee. If you wear a uniform, use your employer’s tools or equipment to carry out your work and do not work for anyone else, then you’re also likely an employee.
If you’re still not sure, my firm developed a pocket employment lawyer tool to help you figure out if you’re a contractor or employee.
Myth: A layoff is different than a termination
Fact: A temporary layoff can be treated as a termination.
If you were placed on a temporary layoff without your consent, you do not have to accept it (unless your employment contract stipulates that it’s allowed). A temporary layoff counts as a change in the terms of your employment. As such, you can claim a constructive dismissal, which means you’re entitled to severance pay.
If you do nothing about a temporary layoff, that counts as accepting it, and you’ll forfeit your right to claim constructive dismissal.
If you agree to a temporary layoff but your employer has no intention of recalling you, that’s also considered a termination. Depending on your situation, you may decide to accept the layoff and hope to one day be recalled. But this may never happen, so it may be best to treat the temporary layoff as a termination and collect your severance pay.
Have you been let go from your job? Are you trying to properly calculate the amount of severance pay owed to you?
Contact the firm or call 1-855-821-5900 to secure assistance from an employment lawyer in Ontario, Alberta, 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.