BC Severance Law
Know Your Rights: An Introduction to BC Severance Law.
BC Severance Law
Do not accept a termination package or severance offer without speaking to a professional first!
The basics of BC severance law should be common knowledge to all employees across the province. We hope that the information provided here will help reduce the number of workers settling for a fraction of what they are properly entitled to upon termination of their employment.
It is critical that employees understand that their severance entitlement under the ESA is only the minimum amount and does not account for the greater severance sums most employees are entitled to under the common law. Compare, for example, the maximum 8 weeks of notice or equivalent pay outlined in the ESA with the maximum severance entitlement under the common law, which is generally 24 months.
Note that by using a well drafted employment agreement, an employer can reduce an employee’s severance entitlement down to the minimum amount outlined in the ESA, thereby removing the employee’s entitlement to much larger sums owed under common law severance principles (discussed here). It is critical that you understand what you have agreed to in your employment agreement!
The Severance Package / Offer
How Much Severance am I Owed?
In Canada, Courts assess common law severance by determining a “reasonable notice” period and then looking at wages and benefits an employee would have earned working over the course of that notice period. The assessment process is an art more than a science, with factors considered by judges summarized in the following passage from the seminal 1960 Bardal v. Globe & Mail Ltd. decision:
The reasonableness of the notice must be decided with reference to each particular case, having regard to the:
– character of the employment,
– the length of service of the servant,
– the age of the servant,
– and the availability of similar employment, having regard to the experience, training and qualifications of the servant.
To learn more about how to calculate severance, click here.
(A Helpful Introduction to Your Rights, Click on Links Below)
What if I have already signed an employment agreement that severely restricts my severance entitlement?
To limit an employee’s severance to the minimum amount stipulated in the Employment Standards Act and displace their entitlement to common law severance, employers must:
- Use a well-crafted employment agreement with precise language in the termination clause;
- Execute the employment agreement in accordance with fundamental contract law principles.
These requirements, which can be difficult for even the most experienced employers to comply with, allow keen employment lawyers to challenge what at first glance may appear to be rock-solid employment agreements. Book a consultation today to have an employment lawyer assess your severance entitlement.