CALGARY – With a slumping economy and hundreds of employees let go across the province this week, it’s time to brush up on the legalities of layoffs.
According to Alberta’s employment standards, a company must give an employee termination notice, termination pay, or a combination of the two when layoffs occur.
No severance pay is required if employees are given the following notice based on the length of their employment with the company:
If the mandatory notice isn’t given, employees should be paid the wages they would have earned for the termination notice period. That means if you have been with a company over 10 years, for example, and are laid off “effective immediately,” you should receive eight weeks of pay.
Some employers may choose to give more than the required amount of pay as an act of generosity on behalf of the company – but they aren’t legally required to do so.
Many companies may opt for the termination pay to avoid the need to continue benefits and insurance payments.
If an employee is offered reasonable alternative work, termination notice/pay is not required.
Companies can also “temporarily” lay off an employee, in which case termination pay can be withheld for 60 consecutive days.
Wendy Giuffre, from Wendy Ellen Inc., has more than 25 years experience in human resources, career transitioning and on-site termination. She was part of the transition process at TransCanada during Wednesday’s layoffs.
Giuffre recommends taking any documents employers give you when you are laid off home to review with family and, possibly, your financial planner.
“We never suggest you sign any legal documentation in the moment… Make sure you understand totally what your package is about and what you’re signing before you sign,” said Giuffre.
If you’re concerned layoffs may be coming at your company here are some tips to help prepare:
– Keep your resume updated;
– Network with people in your industry;
– Remove personal files from your work computer;
– Take advantage of your health benefits (you may lose them immediately once you’re laid off);
– Create a savings account to help buffer wage losses.