Being fired by your employer can come as quite a shock. In my experience as an employment lawyer, many of my clients have told me that their termination has shaken their confidence to look for a new job.
If you are dismissed from your job, however, you have a responsibility to look for work in a similar position or field. This is called an employee’s duty to mitigate.
Failure to do so could substantially reduce the amount of severance pay you are ultimately owed.
Here are the three main reasons why you have to look for a new job after getting fired.
1. You are not entitled to an unlimited amount of severance
When you are let go, either without cause or incorrectly for cause, the company must provide you with a full severance package.
Severance can be as much as 24 months’ pay. It’s calculated using several factors, including age, position, length of service and your ability to find new work.
This financial compensation generally comes in the form of salary continuation or a lump-sum payment.
If your employer choses salary continuation, you’ll continue to be paid as though you are still an employee. If the company opts for a lump-sum payment, you will receive your compensation all at once.
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While a severance package helps you pay bills and put food on the table, it’s specifically designed to bridge the gap between jobs. Once your employer fulfills their severance obligations, they don’t need to provide you with additional financial support even if you are still unemployed.
As soon as you receive a severance offer from your company, I recommend having an employment lawyer review the agreement before you sign it.
You have two years from the date that you are let go to pursue full severance. While you start looking for a new job, my firm can make sure you are getting the compensation that you are entitled to.
2. The effort you put into the job hunt affects how much severance you are owed
If you don’t make a reasonable effort to find work in a similar position or field after you have been dismissed, your severance entitlements could be substantially reduced.
To prove that you did try to find comparable employment, I suggest documenting the entire job hunt. This includes keeping a record of every place you applied to, the date you applied, the position you applied for and what came of the application.
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This doesn’t mean that you must apply for work every second of every day or accept the first job offer you receive. Employees generally aren’t required to take a new job that isn’t comparable to their prior role when it comes to salary, responsibility, hours, working conditions or distance from home.
For example, if you worked as a senior manager for a bank, you don’t need to accept a job clearing tables at a restaurant.
If you do find a new placement after your employer informed you that you will be fired at a later date, which is legally referred to as working notice, the severance pay you are owed can be reduced by your mitigation income or whatever you earn during the relevant time period.
3. Your employer may check to see if you fulfilled your duty to mitigate
When determining severance, your company might hire an employment lawyer to follow up on your job search. The first question is often whether or not you have accepted any offers.
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Honesty is the best policy in this situation. If your matter goes to court — which rarely happens, in our experience — you will be questioned under oath about your efforts to find work in a similar position or field.
If the court finds that you are lying, it could make a potential settlement agreement void and affect the amount of compensation you are ultimately owed.
To avoid the courtroom, contact an employment lawyer at Samfiru Tumarkin LLP. My firm has helped thousands of individuals successfully negotiate their severance packages before there is a need to get a judge involved.
Speak with an employment lawyer before accepting a job offer
Once you find a new job, you will likely be asked to sign an employment contract. Take time to carefully review the agreement.
If you are unsure about what you are accepting, have an experienced employment lawyer, like the ones at Samfiru Tumarkin LLP, review the terms of the agreement.
READ MORE: 5 things employees should never do before talking to an employment lawyer
Our lawyers can help you enforce your workplace rights and ensure that you are presented with the most favourable contract available before starting your new position.
Fired or lost your job? Being pressured to sign a severance offer or employment contract immediately?
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 co-founding partner at Samfiru Tumarkin LLP, Canada’s most positively reviewed law firm specializing in employment law and long-term disability claims. He provides free advice as the host of Canada’s only Employment Law Show on TV and radio.