Termination of employment in Ontario: Employee rights, notice periods, and severance pay
Termination of employment is an inevitable part of the employment relationship. In Ontario, the law provides certain protections for employees who are terminated from their employment. As an employee, it is important to understand your rights, notice periods, and severance pay in the event of a termination.
In Ontario, the Employment Standards Act (ESA) sets out the minimum standards for termination of employment. Generally, an employer can terminate an employee’s employment for any reason, as long as the termination is not discriminatory or contrary to public policy. However, an employer must provide an employee with notice of termination or pay in lieu of notice.
Notice periods are based on the length of an employee’s service with the employer. For employees who have been employed for less than three months, no notice is required. For employees who have been employed for three months or more but less than one year, the minimum notice period is one week. For employees who have been employed for one year or more but less than three years, the minimum notice period is two weeks. For employees who have been employed for three years or more, the minimum notice period is three weeks plus one week for each additional year of service, up to a maximum of eight weeks.
In some cases, an employer may choose to provide pay in lieu of notice instead of providing notice. Pay in lieu of notice is an amount of money equal to the employee’s regular pay for the notice period. This option may be chosen when the employer wants the employee to leave immediately, or when the employee is not willing or able to work during the notice period.
In addition to notice or pay in lieu of notice, an employee who is terminated may be entitled to severance pay. Severance pay is a lump sum payment that is separate from notice or pay in lieu of notice. To be eligible for severance pay, an employee must have been employed for at least five years and have worked for an employer with a payroll of at least $2.5 million. The amount of severance pay is based on the employee’s length of service and salary.
It is important to note that the above information is only the minimum requirements under the ESA. Employees may be entitled to additional notice, pay in lieu of notice, or severance pay under their employment contract or collective agreement. Employees should review their contract or agreement to determine their entitlements.
In conclusion, termination of employment can be a difficult and stressful experience. However, employees in Ontario are protected by the ESA and are entitled to notice, pay in lieu of notice, and severance pay in the event of a termination. It is important to understand your rights and entitlements as an employee, and to seek legal advice if you have any questions or concerns about a termination.
Our team can help you if you think you have been wrongfully terminated, call us today.
