The Five Things All Employees Should Know About Severance

The Five Things All Employees Should Know About Severance
Source: Employment Law Show Youtube Video Channel

Being let go from a company is rarely a joyous time. Sometimes, it involves employment lawyers. For the most part, it comes in a blind-side fashion. Employees more often than not do not see it coming and feel unprepared for what may come next. But things don’t have to be all bad.

Depending on your employment situation, you may be in a position to receive a severance package on your way out the door. If you have recently been let go by an employer and have been offered a severance package, there are a few things that you should know.

  1. More Than One Week’s Pay Per Year of Service

Perhaps the most common misconception about severance pay is that it consists of one week of pay for every year of service with the company. This is generally not correct, though the correct time is dependent on the province in which the employee works.

It also depends on whether or not the employee is unionized. Still, the difference is greater than a single week of pay for each year. If you have been offered a low term of termination pay from your employer, it may be prudent to get in touch with an employment lawyer.

When the employer does not provide an outgoing worker the proper amount of common-law severance pay, that employee has the ability to pursue a wrongful dismissal claim. That opens up a whole slew of other possibilities in terms of recompense for the employee.

  1. Terminated Without Cause? You Are Owed Severance

There are two types of termination: with cause or without cause. Without cause means that an employer can fire an employee for literally any reason, good or not. That is so long as there are no signs that the dismissal is from discrimination.

When an employee is terminated without cause or wrongful termination Los Angeles, the employer is obligated to pay severance to the employee. A with cause termination is only when the employee has committed serious misconduct in the workplace.

If you have been terminated recently without cause and have not heard from your employer regarding a severance package, you should get in contact with them. If they continue to battle you about providing severance, you may need to get in touch with a professional to facilitate the issuance of that severance package.

  1. Contractors May Be Owed Severance

There is some issue with the classification of contractors in Canada. Only through legal action has the classification of contractor versus employee come to the forefront. Still, there is some muddying of the waters on the part of employers.

Companies that hire independent contractors do so with the intent of not providing benefits that go to full-time employees. They don’t get the same rights and privileges that regular employees do, so they are oftentimes not entitled to severance from the company.

That said, a lot of independent contractors, in the eyes of the law, are considered employees. When that contractor is let go, there is a good chance that they are due a severance package. Contacting a professional is definitely the right way to go in that instance.

  1. Severance May Be Owed Even Over a Short Period of Time of Employment

It would theoretically be safe to assume that an employee who has been with a company for a short period of time would be due only a little severance pay, if any at all. But a recent legal precedent has been set that changed that.

The case, where a former employee had proven that he was wrongfully terminated after six months, saw him go from one week of severance pay to six months. The argument being that his level of income and difficulty in finding new employment played a factor.

While this may not always be the case, there are potentially larger severance packages available for short-term employees. It is important to know your rights and to ask the appropriate questions should the situation arise.

  1. Employees Don’t Have to Meet Employer Deadlines

You would be hard-pressed to find an employer that does not have arbitrary deadlines attached to their severance packages. The expiration date on these packages, according to the employer, can be anywhere from a day to a week.

The employer will suggest that if the package isn’t signed by the deadline, they will pull the offer and the employee will get nothing. But the right to pursue termination pay doesn’t expire for two full years legally.

The push is to attempt to pressure the employee into accepting a smaller severance package than the one that they may be legally entitled to. The only way to be truly protected when it comes to severance packages is to have a lawyer on your side.