An employee that has been employed in Ontario for more than three months in an indefinite employment relationship (separate from a fixed-term contract), is entitled to a statutory minimum amount of advanced notice of termination or payment in lieu thereof in accordance with the Employment Standards Act in Ontario, should the employer opt to terminate the employment.
The exception to the general rule is when an employer terminates the employee for cause, in which case the employee is not entitled to any notice of termination. The notice is either provided (1) by way of advanced notice by the employer, during which time the employee continues to work for the company until the end of the notice period; (2) by a payment in lieu of notice equivalent to the value of salary and benefits the employee would have received has they continued working through the notice period; or (3) a combination of advanced notice of termination and payment in lieu thereof.
If payment in lieu of notice is provided to the employee, the payout must be made on the employee’s regular pay date or seven days after the termination, whichever is later.
Employment Standards Act – Notice Periods
The Employment Standards Act in Ontario outlines the minimum termination pay and severance pay obligations of employers. Keep in mind, these are minimum obligations and do not represent an employee’s full legal entitlements on termination of employment. The following is a table outlining the statutory minimums under Ontario’s ESA:
Length of Employment Minimum Notice Required
Under 3 months None
3 months to under 1 year 1 week
1 year to under 3 years 2 weeks
3 years to under 4 years 3 weeks
4 years to under 5 years 4 weeks
5 years to under 6 years 5 weeks
6 years to under 7 years 6 weeks
7 years to under 8 years 7 weeks
8 years or more 8 weeks
The statutorily mandated minimum notice period generally does not constitute a reasonable severance package in accordance with the common law in Ontario; accordingly, if you have only been offered the minimum ESA entitlements, you have a wrongful dismissal claim. Please contact an employment lawyer in Toronto at Goldstein Law Firm for a free consultation to discuss your rights.