Employee Termination – A Legal Guide For Canadian Employers
Employment terms in Canada are based on the contract between the employer and employee. If there isn’t a contract of employment in writing, contractual terms depend on the common law. Employment termination is one of the crucial aspects for employers. It is because they have some responsibilities and obligations towards the employee being terminated. If they fail to fulfill these obligations, they can get into legal trouble. Here is a legal guide that can help Canadian employers navigate employee termination while being on the right side of the law.
Statutory notice and severance
Provincially-regulated employers in Ontario must follow the Employment Standards Act, 2000 for minimum standards for statutory notice and severance pay while terminating an employee. The number of years of service decides the notice period and value of severance pay for the employee. Essentially, they are entitled to one week’s notice for each year in service, subject to a maximum of eight weeks. The value of severance pay is one week per year of service, subject to a maximum of 26 weeks.
“Just Cause” dismissal
An employer may terminate an employee for just cause at any time. In this case, they will not have to give a notice or compensation in lieu of notice, and neither will they have to provide severance pay at the time of closing the employment. But they have to take the onus of establishing just cause, which is generally challenging for employers. They must have strong evidence validating grave misconduct such as fraud, insubordination, or breach of company policies.
“Without Cause” dismissal
If an employer wishes to terminate an employee without just cause, they can do it, but only after giving them a period of advance notice. If they fail to provide advance notice, they have to compensate them in lieu of notice or provide statutory severance pay in some cases. The notice period depends on the relevant statute, company policy, employment contract, and common law. Employees can bring up a wrongful dismissal case to enforce their rights in such cases. It makes sense to consult the best employment lawyer Toronto at sultan lawyers before going ahead with such dismissals. They can guide you about handling the notice period and severance pay package to avoid litigation in the first place.
The employment contract is the key
According to Canadian employment law, employers must treat terminated employees fairly and with dignity. But it is also vital to safeguard one’s business against litigation, which is best done by paying attention to employment contracts at the time of hiring. Employers should have a written contract that outlines employment and includes clauses regarding potential termination of the relationship. They must ensure that the employee reads, understands, and signs the contract to have a clear view of their rights and entitlements at the time of termination under different circumstances.
Employee termination is a delicate matter, and employers need to handle it with great care. It is vital to know the law and adhere to it so that you can protect your business from lawsuits and fortify its reputation.
