When an employer wants to terminate an employee without cause, they must provide the appropriate amount of “notice” or “pay in lieu of notice” to that employee
EMPLOYMENT STANDARDS ACT
Instead of providing four weeks of working notice to an employee, the employer could provide them with 4 weeks of pay in lieu of working notice. In such a case, the employee does not need to spend those four weeks actually coming into work. The amount of notice the employer must give the employee when dismissing them from employment depends on many factors. The notice period is important because it will determine the amount of “severance” owed to the employee. There are several sources to consider in determining an employee’s notice period upon termination. The Employment Standards Act sets minimum entitlements that a terminated employee must receive, based on their length of service. However, employers can only provide these minimums if there is an enforceable employment agreement and termination provision in place that limits the employee to the statutory minimums. Employers will often attempt to include a termination provision in an employment agreement as a way to limit the amount of notice they owe the employee. However, termination provisions are often not enforceable, for a variety of reasons, in which case the length of the notice period is calculated according to the common law.
Among other things, the courts consider: the length of employment, the position of the employee, the reason for their dismissal, the employee’s compensation, how the employee first became involved with the employer, and whether the employer acted fairly and in good faith, to name a few. Every case is different and the above factors will be considered to determine the appropriate common law reasonable notice period. Normally, 24 months is the maximum notice period available to an employee, although this amount may be extended in truly exceptional cases. Employment law cases relevant to this area of law include: Wallace v. United Grain Growers Ltd. (1997), 152 D.L.R. (4th) 1, (1997) 3 S.C.R. 701; Machtinger v HOJ Industries (1992), 91 D.L.R. (4th) 491 (S.C.C.) and Bardal v. Globe & Mail (1960), 24 D.L.R. (2d) 140 (H.C.) Please note that the above information does not constitute legal advice. It is general information about the law. If you require legal advice with an employment issue, please contact the experts at Ball Professional Corporation.
Canadian Employment Law
Mr. Ball is author of the authoritative and definitive text Canadian Employment Law - published by Canada Law Book (a division of Thomson Reuters). The text is used and cited by lawyers, law schools and judges across Canada.
To order Mr. Ball's Canadian Employment Law please visit the Carswell Store by clicking here or on the button below.