6,072 – that’s the tally of Canadian workers terminated so far in 2024 according to news outlets.
This number doesn’t include terminations made by organizations like Google, Indigo, BenchSci and Staples that haven’t released specific headcount termination data yet for this year.
Nonetheless, thousands of Canadians are being impacted by 2024 terminations and there are some key considerations for both employers and employees to mull over during this time.
While cutting costs may be top of mind, employers should also consider:
Termination letter language – If an employee proceeds to contest a termination, the termination letter is often closely scrutinized. A termination letter will be weighed as critical evidence in any wrongful dismissal case. Employers must give special attention to the reason for the termination (if any), the construction of the financial offer made on termination, and they must ensure all legal entitlements are met including vacation payouts, termination and severance pay requirements, and benefit continuation.
HR complaints and ongoing investigations – Employers that terminate employees pending the outcome of an investigation or complaint process may attract greater liability. These untimely terminations may be construed as reprisals against employees for launching complaints, which could lead to awards of additional damages to employees.
Employment agreements – Look back at employment agreements signed by employees to determine if termination entitlements were negotiated at some point either prior to employment starting or at the time of a promotion. Get some advice on whether or not the employment agreement is enforceable and if you can rely on it.
One size does not fit all – While employers often create and apply the same ‘severance pay’ formula to employees at the time of layoffs, the fact is, different factors will bear more weight in the courts. For example, older workers, more highly paid workers, and those with niche skill sets could be granted higher notice periods depending on their role. Expect that different employees will react differently depending on age, seniority and level of pay.
Employees who are facing terminations in early 2024 have a lot to consider as well, including:
Termination package offerings – Does your termination letter cover every aspect of your perks and compensation like salary, bonus, commissions, pension, benefits and LTIP? Don’t expect your employer to lay out everything you may be entitled to. If your termination letter is silent to certain perks and benefits, your employer may not intend to pay you anything for them on termination. That, however, doesn’t mean you are not entitled to them and you should discuss this with a lawyer.
Availability of similar employment – When wrongful dismissal cases are brought, a major consideration is how long it will take an employee to find a similar job at a similar level of pay. Think about your industry, your expertise and any hurdle to finding new employment. That will help you discern if your severance package is fair or on the lighter side.
Recent employment agreement sign-offs – If you signed a new employment contract in the last two to three years, it could have a higher chance of containing a termination provision that is enforceable. That is because recent case law has led many employers to update their employment agreements and tighten up termination language. Get this language reviewed if you are terminated to better understand your entitlements on termination.
2024 is already shaping up to be full of ups and downs in the world of employment.
An unpredictable job market will urge employees to strongly consider pushing back on severance packages. Keep these tips in mind, regardless of the side of the table you are sitting at.
Have a workplace issue? Maybe I can help! Email me at sunira@worklylaw.com and your question may be featured in a future column.
The content of this article is general information only and is not legal advice.
