In 2023, many large tech companies have announced mass terminations and layoffs in Canada due to what they term a slowdown in the sector. For example, Salesforce announced that it would cut 10% of its employees and even close some of its offices. In a letter sent to employees, Salesforce stated that the rapid pandemic hiring had left it with too many staff. It is not clear how many employees will be affected by the mass layoffs. However, Salesforce offices in Toronto, Halifax, and Vancouver have approximately 1800 Canadian workers.
Similarly, Amazon also announced a massive workforce reduction that will affect around 18,000 jobs. This layoff affected Canadian workers at Amazon. Other renowned tech companies that have announced layoffs include Meta/Facebook, Microsoft, and Twitter. Salesforce promised to give generous termination/severance packages to the employees affected by the restructuring. However, should employees in Canada assume that the packages are fair based on legal standards? Workers should not assume that the severance package their employer is offering them is what they are entitled to; they could be worth much more.
Several factors are triggering the mass layoffs in Canada, including rising interest rates, inflation, changing consumer habits, and supply chain issues. If you have been affected by the recent layoffs in Canada, you are probably wondering, are layoffs legal in Canada? What steps should you take after receiving a layoff notice? If you are a non-unionized worker who has lost their job due to corporate restructuring or downsizing, you need an employment lawyer in Mississauga who understands Canadian layoff laws to help you know your rights.
When You Lose Your Job
You are likely entitled to a severance package if you are a non-unionized employee and you are fired without cause. You could also be entitled to compensation if you are incorrectly let go for cause. When calculating your reasonable notice period, several factors are considered:
- Your age
- The position you held at the company
- How long you have worked in the company
- Your ability to find new employment
The older you are and the longer you have worked, the longer your period of reasonable notice. High-level, senior, or unique employees are also entitled to a higher severance package. With the proper legal representation, you can receive a severance package that greatly exceeds the statutory minimumsand based on your total compensation.
Your total compensation is determined based on all the benefits and compensation you earned during employment. This includes your commissions, benefits, regular bonuses, allowances, profit-sharing payments, incentive programs, and other consistent or tangible payments beyond your salary. Many severance packages are deficient in these areas since employers often discount or discontinue some elements of your total compensation in an unfair way.
Understanding the Employment Standards Legislation
Any layoff or restructuring that leads to lost jobs qualifies as a termination without cause. When that occurs, your employer must comply with the Employment Standards Act (ESA) or for federally regulated industries, the Canada Labour Code. These statutes define the minimum period of notice of termination that employers should give their workers and requires employers to pay their workers additional severance pay in some cases. The applicable amounts are determined based on tenure and could go up to 8 weeks’ notice or pay, plus applicable severance pay, if entitled.
Your Employment Contract Can Affect Your Severance Pay
Some companies make workers sign employment contracts that limit their entitlement to a severance package. If you signed such a contract, the court would only rely on it if it is valid and in compliance with the ESA. If your employer is relying on any document you signed to limit the severance, you should ensure that your lawyer looks at the document.. Many contracts are not valid contracts and will not limit your entitlement to reasonable notice.
Your Severance Package Doesn’t Have to Match That of Your Co-workers
Your severance package will be calculated based on the compensation and benefits you have earned during your employment. Therefore, just because you and your co-workers lost employment together as part of the same mass layoff doesn’t mean that you will have equal severance packages. Your severance package will also depend on your individual circumstances, like tenure, age and position. It will not have anything to do with what your co-workers have agreed to or received.
Steps to Take If You Were Recently Laid Off
You should take the following steps:
- Take time to discuss the severance package with a lawyer to help you make an informed decision
- Do not agree or sign anything unless you are certain
- If need be, do not hesitate to ask for an extension of time so you can speak with a lawyer.
Even if the offer seems lucrative, do not assume that what the company has offered is what you are entitled to.
Our Lawyers Can Help
If you have lost your job as part of a layoff in Canada, our lawyers at Walter Law Group can help you examine your severance package to determine if it is adequate. We have helped thousands of employees to pursue their rights. Contact us today. We will work hard to ensure you obtain the compensation you deserve.