Tech layoffs: Seek legal advice, negotiate terms if you’ve lost your job, experts say

Tech industries worldwide have been hit with layoffs, leaving thousands without a job.

As many switched to working remotely during the COVID-19 pandemic, tech companies went on a hiring spree due to a rising demand in products, software and services. However, job cuts began last spring as company valuations started to dip and investor interest faded with consumers returning to pre-pandemic habits.

Jon Pinkus, partner at the labour and employment law group Samfiru Tumarkin LLP, says their firm has recently dealt with tech employees impacted by the slashes.

“What many of them tell us is: ‘It’s a double whammy because I’ve lost my job and I don’t know how I’m going to get another one in the near future because everyone else is in the same circumstances as me.’”

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Last week, Amazon laid off 18,000 staff, Microsoft slashed 10,000 jobs and WeWork cut 300 workers.

In Canada, layoffs included 300 people at Lightspeed, 150 at Clutch and 70 at Hootsuite.

They followed other prominent tech companies like Shopify Inc., Meta, Netflix, Lyft and Stripe, which conducted layoffs over the last year. Twitter, under new CEO Elon Musk, has also slashed thousands from the company’s workforce.

The first thing you should know if you’ve lost your job, according to Pinkus, is severance offers are likely to be low.

“Don’t take what your employer says at face value. They’re going to be looking out for their own interests and the only way that you can look out for yourself is if you get your own legal counsel,” he said.

Those who went to Pinkus after being let go had somewhat “wanting” severance offers, he noted.

Pinkus recommends immediately speaking to a lawyer if dismissed from a job to help ensure severance pay is negotiated properly.

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Severance packages will vary from person to person depending on a number of factors, according to Pinkus.

“The main thing that the law looks at is your age, your position and your tenure – but that’s really the starting point,” he said. “An employment lawyer is going to be able to help you assess what those entitlements are.”

When speaking to an employment lawyer, it’s important to have your termination letter and any documents you received upon your hire handy, says Pinkus.

“You want to (read everything carefully) before you sign anything,” he said. “Once you sign something, that’s it.”

Oyeyinka Oyelowo, lawyer for Yinka Law, says asking for more time before signing any documentation is crucial.

“Oftentimes, when people are put in a precarious situation such as a job loss, they feel more vulnerable,” she told Global News.

“I know a lot of people are going through a tough time, but you have to start thinking about negotiating your severance.”

Although it is possible to advocate for yourself in this situation, Oyelowo, like Pinkus, recommends seeking a lawyer, noting employees who’ve lost their job will need independent legal advice based on their situation.

“Self-represented individuals on average are less likely to achieve success,” she said.

“Retaining a law firm will help you fight for your rights in regard to having the appropriate amount of severance paid out to you. The best advice I can give you is to seek support from a legal professional, because it is their expertise to be able to get you the best possible results.”

In order to avoid litigation fees, employers and employees will typically be able to negotiate with the help of a lawyer without going to court, Oyelowo says.

However, sometimes a claim will be filed in court to help negotiates. This can happen, for example, if a large group of employees get laid off from a company, explained Oyelowo.

“If the negotiation process does not work, the next step possibly is litigation,” she said.

Like Pinkus, Oyelowo thinks it’s important to keep in mind that your severance will depend on how long you’ve worked for a company.

“An individual who may have worked with the employer in a non-unionized environment for five years (and is) laid off would be able to negotiate a severance package that’s entirely different from someone who worked in that environment for approximately 11 years, for example,” she said.

“There are a lot of different factors that you want to keep in mind.”

There are also employment standards statutes that exist to protect people should they lose their job, Oyelowo noted.

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“There are certain obligations that larger scale companies have to abide by in regard to treating workers in a legal way when they lay them off,” she said.

“The Employment Standards Act mandates certain amounts to be paid out to employees, especially in situations relating to a layoff,” she said referring to the Ontario policy designed to help protect workers.

The federal government’s Labour Code also outlines procedures that must be followed when terminating an employee.

For example, if someone who was let go considers their dismissal unjust, they may be able to make a complaint provided they’ve been employed for 12 consecutive months and are not a member of a group of employees subject to a collective agreement, according to the Code.

In Canada, people may also be eligible for unemployment insurance benefits if they have been let go for no fault of their own.

In order to receive the benefit, one must have been in insurable employment, and have been without work and pay for at least seven consecutive days in the last 52 weeks, among other criteria, according to the benefit.

For most, the basic rate of calculating how much money you’d receive through unemployment is 55 per cent of your average insurable weekly earnings, up to a maximum amount of $650 per week.