For Employees

Severance Entitlement on Being Fired or Dismissed Without Cause

Have you just been dismissed or let go without cause?
Are you entitled to severance?

Generally, when an employee is let go without just cause, the employer must provide the employee either with advanced working notice   of the termination (which we will refer to simply as “notice” from here on in) or pay in lieu of such notice (also known as “severance”). An employer has the option of providing the employee with a combination of notice and severance.

It should be noted that severance is normally spoken of in terms of time rather than dollar figures. This is because severance is actually pay in lieu of the notice, which otherwise would have been provided to the employee. When severance is calculated, it is based upon the amount of notice the employee should have received.

So how much notice or severance is an employee entitled to? In British Columbia, the Employment Standards Act sets out minimums for both notice and severance.  It is important to emphasize that the Employment Standards Act only sets minimums. Frequently, the entitlement to notice or severance is determined by precedent — that is, previous court decisions. Based upon the precedents set out by courts, employees are often entitled to advanced working notice or pay in lieu of such notice exceeding the minimum in the Employment Standards Act. The most useful precedent court cases are those dealing with employees similar to the employee in question.

In determining notice or severance entitlements, the Courts have considered four main factors:

  • character of the employment
  • the employee’s length of service
  • the employee’s age, and
  • the availability of alternative employment.

Of these four, the primary factors have been the character of the employment and the employee’s length of service.

Courts have tended to adjust the notice or severance entitlement up for employees that have a longer length of service, and for employees that had more responsibility in their employment. By looking at cases dealing an employee similar to the one question, there will typically be a range of severance awards that can be used to predict the severance entitlement for an employee.

Lastly, and perhaps most importantly, notice and severance entitlements can be dealt with by way of an employment contract between the employee and the employer. Subject to limited exceptions, these clauses are often enforced by the courts providing they meet the minimums set out in the Employment Standards Act.

As mentioned, notice or severance must be given to an employee where an employee is dismissed for reasons other than just cause. If there is just cause for the dismissal of an employee, then the employee is not entitled to severance. And what is just cause for dismissal? Well, that is a very intricate and complicated question for later blog posts.

If you have been dismissed, and believe that you may be entitled to severance, please contact me for a consultation today.

This blog is produced by Waterstone Law Group LLP. This blog is intended for information purposes only and is not offered as legal advice for a specific claim. Subscription to or use of this site does not establish a solicitor – client relationship between the user and Waterstone Law Group LLP or any of the individual contributors. For advice relating to your employment law claim, please contact us to arrange for a consultation.

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