Employees who are let go or fired from their job aren’t always offered adequate severance packages — and often they don’t realize that they might be owed more.
During a termination, an employee usually receives a termination letter that briefly explains why they are losing their job. It also outlines the statutory entitlements, or minimum amount of severance, that the employee must be paid, based on the province they work in. It is illegal for an employer to provide anything less than the minimum statutory entitlements.
READ MORE: How to calculate a severance package in Ontario
The termination letter often includes the offer of an enhanced severance package: The employee gets more money in exchange for signing a full and final release of the company for all liabilities, but only if they sign by the company’s deadline, which is often less than a week later.
Lots of people I speak to are tempted to sign. But it’s often not the right choice. Here’s what to know about severance offers and deadlines to accept them.
What is the purpose of a severance offer deadline?
A deadline is a pressure tactic. In my experience as an employment lawyer, the deadline is meant to coerce terminated employees — who are already in a vulnerable state — to accept severance packages worth far less than what they are owed.
What should you do if your severance offer is conditional upon a deadline?
Your right to severance pay does not expire on the deadline your employer has set. By law, you have two years from the date of termination to pursue your legal entitlement to a full severance package, which can be as much as 24 months’ pay.
I always recommend seeking independent legal advice before accepting a severance package. Take time to regroup after being let go, which can be upsetting, then contact an employment lawyer, like the team at Samfiru Tumarkin LLP, to get the advice you deserve. A lawyer can usually negotiate a better severance package than the one offered in the termination letter.
READ MORE: The 5 facts you need to know about severance pay, according to an employment lawyer
My employer didn’t give me a deadline because they said I’m not owed anything
Your employer may suggest that you don’t legally qualify for severance, or say that you signed an employment contract that forfeits your right to a package over and above the minimum entitlements.
In my experience, however, many people get inaccurate information from their employer or have signed a contract that’s not enforceable. An employment lawyer can investigate your situation and find out if that’s the case.
If you accept a severance offer, can you take it back?
Most of the time, you cannot take back your acceptance of a severance offer. If you sign a document called a full and final release, the deal is usually binding. An employment lawyer can check for this and let you know whether the deal is binding — or help you negotiate a better one.
READ MORE: Severance pay for contractors: What to know and what to do if you think you’re an employee
Every year, our firm gets questions from thousands of terminated employees who have been offered a severance package and told by their boss to comply with the time limit on their offer for compensation.
But in my negotiations, I’ve never had an employer tell me that my client is no longer entitled to severance because they missed the employer-set deadline — because it’s not true, and employers know it.
Have you been let go from your job and offered a severance package? Are you trying to properly calculate the amount of severance pay owed to you? Don’t leave what could be thousands of dollars on the table.
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.
Jeremy Herman is an employment lawyer at Samfiru Tumarkin LLP, Canada’s most positively reviewed law firm specializing in employment law and long-term disability claims. The firm provides free advice on Canada’s only Employment Law Show on TV and radio.