Frequently Asked Question by Employees
What is “Wrongful Dismissal”?
Wrongful dismissal refers to an employer’s failure to provide an employee with reasonable working notice or pay in place of notice when terminating employment in the absence of just cause. In cases where an employer is found to have wrongfully dismissed an employee, the employer will be held liable for damages, including pay in lieu of reasonable notice.
What is “Reasonable Notice”?
Reasonable notice is the notice an employee is entitled to receive when terminated from their job without cause. Reasonable notice may be written or verbal, but it must be communicated in clear and plain language. If an employer fails to provide the appropriate notice or compensation in place of notice, the employee may be entitled to damages for wrongful dismissal. The length of notice varies from employee to employee and depends on a number of factors.
How Much Notice is Reasonable?
Notice requirements are governed by both legislation and case law.
Reasonable Notice Obligations Under Legislation
The minimum statutory requirements for notice or pay in lieu of notice vary depending on the employee’s length of service. Notice requirements under the Employment Standards Act are as follows:
|Length of Service||Notice or Termination Pay|
|After 3 months||1 week|
|After 12 months||2 weeks|
|After 2 years||2 weeks|
|After 3 years||3 weeks|
|After 4 years||4 weeks|
|After 5 years||5 weeks|
This pattern continues up to a maximum of eight weeks after eight years of service. Employers must give employees either working notice or compensation in place of notice for the appropriate period. The Employment Standards Act also provides that all benefits must continue during the notice period.
Reasonable Notice Obligations Under Common Law
At common law, the courts examine a variety of factors to determine reasonable notice, including:
- The employee’s age;
- The position held;
- Length of service;
- The employee’s level of compensation; and
- The availability of similar work, given the employee’s experience, training, and qualifications.
In turn, this notice period will assist in determining the amount of compensation a worker is entitled to upon dismissal.
Who is Entitled to Severance Pay?
In addition to termination pay, an employee may be entitled to severance pay if the following conditions are met:
- The employee must have been employed by their employer for at least 5 years; and
- The employer has a global payroll of at least $2.5 million.
The amount of severance pay required by the legislation is one week’s pay per year of service, to a maximum of 26 weeks.
What is “Just Cause”?
Just cause is more than having a ‘good reason’ to terminate someone’s job. Just cause is behaviour on the part of an employee that is so egregious the employee is deemed to have broken the terms of their employment contract. As a result, the employee is not entitled to reasonable notice or pay in lieu of notice upon dismissal. The onus is on the employer to prove the employee has committed an act tantamount to just cause for dismissal. An employee may be wise to contact employment law counsel to determine whether there is just cause to dismiss a worker without notice or whether the employee will be able to sue for wrongful dismissal.
What Happens if I Quit My Job?
Just as an employer is required to provide reasonable notice when terminating an employee, there is a corresponding duty on an employee who wishes to terminate the employment contract by quitting. Often, employers are not anxious to continue the employment of individuals who have tendered their resignations. As such, an employer may either waive the reasonable notice requirement or require only a minimum amount of notice.
An employee who voluntarily quits or resigns from their job is not legally entitled to severance pay or pay in place of notice, and they cannot sue for wrongful dismissal. In some cases, an employee who resigns in response to an intolerable or hostile work environment or a particularly onerous change to their employment may have a valid claim for constructive dismissal.
What is “Constructive Dismissal”?
In a case of constructive dismissal, an employee has not been terminated, but the employer has unilaterally made a substantial change to the employee’s working conditions. The change may relate to, amongst other things, the employee’s duties, position, compensation package, or work environment. The change is such that the employee may feel forced to resign from their job. The remedies for constructive dismissal are similar to those found in a wrongful dismissal lawsuit. As constructive dismissal is an extremely complex area of employment law, specialized legal advice should be sought.