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Employment Law Myths

Myth: Upon termination, the package you should get directly relates to your seniority and you can go online and find a pay in lieu of notice calculator to discover your entitlement.
Reality: Part of your entitlement is dictated by the Employment Standards Act. That includes a week per year termination pay to a limit of eight weeks and, if you’ve been there more than five years and your employer has a payroll of over $2.5 million within the last three years, severance pay of a week per year to a limit of 26 weeks.
Those are minimums and you are entitled to them even if you get a better paying job the next day. More importantly, the courts will award reasonable notice having considered primarily your age, seniority, and level of responsibility. Reasonable notice includes the Employment Standards minimums. It is a very rare thing when anyone is awarded more than 24 months’ pay in lieu of notice. Any health issues you are facing or the market for your skills can also affect the notice period.
Regardless of how much the judge awards, she will subtract from it any monies you made during that period from new employment having proven you made reasonable efforts to look. Nobody starts by offering the full notice period without reduction.
The next time somebody tells you its two weeks or three weeks per year, or some such easy formula, ignore them. It is a much more complex estimation that should be based on an in-depth knowledge of the case law.
Do see an employment lawyer but don’t show them your offer until they have told you what they think you should have been offered. Make them do a blind assessment That way you can have more confidence that they are not just telling you what you want to hear to open a file.
Myth: Working notice does not count.
Reality: It absolutely counts. That is why we call it pay in lieu of notice. If you provide the advance notice of the termination date you don’t have to provide compensation instead. This does not apply to the severance pay of up to 26 weeks referred to above but it applies to the eight weeks’ termination pay under the Employment Standards Act and the reasonable notice at common law that a judge would award. A judge will subtract working notice right off the top in calculating your damages.
Myth: Pay in lieu of notice is just the lost salary.
Reality: A judge will try to put you in the same position you would have been in if you had received working notice for the entire notice period based on your age, seniority and level of responsibility. That is the legal ideal. That can include lost bonus, benefits coverage, pension contributions and taxable car benefit.
Myth: I can negotiate the package on my own.
Reality: Sometimes that is correct and a better choice than hiring a lawyer. Before I look at a package I tell my client what it should look like. If it is very close to or exceeds my estimation and the clients wants to continue negotiations, I will often suggest wording they can use to do that on their own. In many situations the client will have more personal (guilt) leverage than I will have legal leverage since the package was already reasonable in the first place.
Myth: The legal costs outweigh the gains.
Reality: I can only speak to my practice. I charge a contingency fee on the increase in the offer that I obtain through my efforts. The fact that my legal bill is a complete tax write-off when you do your return reduces that fee by at least a third. Frankly, any lawyer who knows what they’re doing in this area of the law can tell immediately if there is going to be a likely chance of improving the offer. If there is not, I should not be opening a file in the first place.
Ed Canning practices labour and employment law with Ross & McBride LLP, in Hamilton, representing both employers and employees. You can read more of his articles on line at the Hamilton Spectator
Ed Canning
Ed Canning
P: 905.572.5809