Termination Of Employment

A variety of expressions are frequently utilized to describe circumstances when work is terminated. These include “let go,” “discharged,” “dismissed,” “fired” and “completely laid off.”

Under the Employment Standards Act, 2000 (ESA) an individual’s employment is terminated if the employer:

– dismisses or stops utilizing a worker, consisting of where an employee is no longer used due to the bankruptcy or insolvency of the employer;

– “constructively” dismisses a worker and the worker resigns, in response, within a reasonable time;

– lays a staff member off for a period that is longer than a “temporary layoff”.

Most of the times, when an employer ends the employment of a staff member who has actually been constantly used for three months, the company should offer the worker with either written notification of termination, termination pay or a mix (as long as the notice and the variety of weeks of termination pay together equal the length of notice the worker is entitled to receive).

The ESA does not need an employer to give a worker a reason why their work is being ended. There are, nevertheless, some circumstances where an employer can not terminate an employee’s employment even if the company is prepared to offer appropriate composed notice or termination pay. For example, somalibidders.com an employer can not end someone’s work, or punish them in any other way, if any part of the reason for the termination of employment is based upon the employee asking questions about the ESA or exercising a right under the ESA, such as declining to work in excess of the daily or weekly hours of work maximums, or taking a leave of absence specified in the ESA. Please see the chapter on reprisals.

Receiving termination notification or pay in lieu

Certain staff members are not entitled to discover of termination or termination pay under the ESA. Examples include: workers who are guilty of wilful misconduct, disobedience, or wilful overlook of duty that is not insignificant and has actually not been excused by the company. Other examples include building workers, employees on short-term layoff, employees who refuse a deal of reasonable alternative employment and employees who have been utilized less than 3 months.

There are a variety of other exemptions to the termination of work arrangements of the ESA. See “Exemptions to discover of termination or termination pay.” Please also refer to the unique guideline tool.

The termination-of-employment rules are entirely separate from any entitlements a staff member may need to be paid severance pay under the ESA.

Constructive dismissal

A positive dismissal might occur when a company makes a significant change to an essential term or condition of a staff member’s employment without the staff member’s actual or implied approval.

For instance, an employee might be constructively dismissed if the company makes changes to the worker’s terms of work that result in a substantial reduction in salary or a considerable negative change in such things as the staff member’s work place, hours of work, authority, or position. Constructive dismissal might also consist of situations where a company harasses or abuses a staff member, or a company provides a worker a final notice to “quit or be fired” and the worker resigns in action.

The employee would have to resign in response to the modification within a sensible period of time in order for the company’s actions to be thought about a termination of employment for purposes of the ESA.

Constructive dismissal is a complex and tough subject. For more details on constructive termination, please contact the Employment Standards Information Centre at 1-800-531-5551.

Temporary layoff

A staff member is on temporary layoff when a company cuts down or stops the employee’s work without ending their work (for instance, laying someone off at times when there is inadequate work to do). The simple truth that the employer does not define a recall date when laying the employee off does not necessarily imply that the lay-off is not temporary. Note, nevertheless, that a lay-off, even if planned to be momentary, might lead to positive termination if it is not enabled by the employment contract.

For the purposes of the termination arrangements of the ESA, a “week of layoff” is a week in which the employee made less than half of what they would ordinarily make (or makes on average) in a week.

A week of layoff does not consist of any week in which the staff member did not work for one or more days since the worker was not able or available to work, was subject to disciplinary suspension, or was not offered with work since of a strike or lockout at their location of work or elsewhere.

Employers are not required under the ESA to provide employees with a written notification of a temporary layoff, nor do they need to provide a reason for the lay-off. (They may, nevertheless, be needed to do these things under a cumulative arrangement or a work contract.)

Under the ESA, a “short-lived layoff” can last:

1. not more than 13 weeks of layoff in any duration of 20 consecutive weeks;
or

2. more than 13 weeks in any duration of 20 consecutive weeks, but less than 35 weeks of layoff in any duration of 52 successive weeks, where:- the staff member continues to receive considerable payments from the company;
or

– the employer continues to pay for the advantage of the employee under a legitimate group or staff member insurance plan (such as a medical or drug insurance strategy) or a genuine retirement or pension;
or

– the employee gets supplementary welfare;
or

– the worker would be entitled to get additional unemployment advantages but isn’t getting them due to the fact that they are used in other places;
or

– the employer recalls the staff member to work within the time frame approved by the Director of Employment Standards;
or

– the employer remembers the staff member within the time frame set out in an agreement with an employee who is not represented by a trade union;
or

3. a layoff longer than a layoff described in ‘B’ where the company remembers a staff member who is represented by a trade union within the time set out in a contract between the union and the company.

If a staff member is laid off for a duration longer than a short-term layoff as set out above, the company is thought about to have actually terminated the worker’s employment. Generally, the employee will then be entitled to termination pay.

Written notification of termination and termination pay

Under the ESA, an employer can terminate the work of a worker who has been employed continually for 3 months or more if either:

– the company has offered the staff member proper composed notice of termination and the notification period has actually expired

– the employer pays termination pay to the worker where no composed notice or less notification than is needed is given

Written notification of termination

A worker is entitled to discover of termination (or termination pay rather of notification) if they have actually been continuously utilized for a minimum of 3 months. An individual is considered “utilized” not only while they are actively working, however likewise throughout whenever in which they are not working but the employment relationship still exists (for example, time in which the worker is off sick or on leave or on lay-off).

The quantity of notification to which a worker is entitled depends upon their “period of employment”. A staff member’s duration of employment consists of not only all time while the employee is actively working but likewise at any time that they are not working however the employment relationship still exists, with the following exceptions:

– if a lay-off goes on longer than a momentary lay-off, the worker’s work is considered (or thought about) to have been terminated on the first day of the lay-off-any time after that does not count as part of the staff member’s duration of employment, despite the fact that the worker might still be employed for purposes of the “constantly utilized for 3 months” credentials

– if two different periods of employment are separated by more than 13 weeks, only the most recent duration counts for purposes of notice of termination

It is possible, in some situations, for a person to have been “continually used” for three months or more and yet have a duration of work of less than 3 months. In such scenarios, the worker would be entitled to observe since a worker who has actually been constantly employed for at least 3 months is entitled to observe, and the minimum notice privilege of one week uses to an employee with a duration of work of any length less than one year.

The following chart specifies the amount of notice needed:

Note: Special rules identify the quantity of notification required when it comes to mass terminations – where the employment of 50 or more employees is terminated at a within a four-week period.

Requirements throughout the statutory notice period

During the statutory notification period, a company must:

– not lower the employee’s wage rate or change any other term or condition of work;

– continue to make whatever contributions would be required to maintain the staff member’s benefits strategies; and

– pay the staff member the wages they are entitled to, which can not be less than the employee’s routine wages for a routine work week each week.

Regular rate

This is a staff member’s rate of pay for each non-overtime hour of work in the worker’s work week.

Regular wages

These are earnings besides overtime pay, trip pay, public holiday pay, premium pay, domestic or sexual violence leave pay, termination of task pay, termination pay and severance pay and particular contractual privileges.

Regular work week

For a staff member who normally works the exact same variety of hours each week, a regular work week is a week of that numerous hours, not consisting of overtime hours.

Some workers do not have a regular work week. That is, they do not work the same number of hours each week or they are paid on a basis besides time. For these employees, the “routine salaries” for a “routine work week” is the typical quantity of the routine salaries earned by the staff member in the weeks in which the employee worked during the duration of 12 weeks instantly preceding the date the notice was provided.

An employer is not enabled to set up a worker’s trip time throughout the statutory notice duration unless the employee-after receiving composed notice of termination of employment-agrees to take their vacation time throughout the notification period.

If an employer offers longer notification than is required, the statutory part of the notice duration is the tail end of the duration that ends on the date of termination.

How to supply written notice

In a lot of cases, composed notice of termination of employment need to be resolved to the staff member. It can be provided in individual or by mail, fax or e-mail, as long as shipment can be verified.

There are unique rules for supplying notification of termination if a worker has an agreement of work or a cumulative contract that offers seniority rights that enable a staff member who is to be laid off or whose employment is to be ended to displace (” bump”) other employees.

In that case, the employer must publish a notification in the office (where it will be seen by the workers) setting out the names, seniority and task category of those workers the employer intends to terminate and the date of the proposed termination. The publishing of the notice is considered to be notice of termination, since the date of the publishing, to an employee who is “bumped” by a worker named in the notification. However, this notification of termination must still satisfy the length requirements set out in the ESA.

There are likewise special guidelines relating to how notice is supplied when there is a mass termination.

Termination pay

A worker who does not receive the composed notification required under the ESA should be offered termination pay in lieu of notification. Termination pay is a swelling amount payment equal to the regular salaries for a routine work week that an employee would otherwise have been entitled to throughout the written notice period. A staff member earns vacation pay on their termination pay. Employers need to also continue to make whatever contributions would be needed to keep the benefits the employee would have been entitled to had they continued to be utilized through the notice period.

Example: Regular work week

Sarah has worked for three and a half years. Now her job has been eliminated and her work has actually been terminated. Sarah was not given any composed notification of termination.

Sarah worked 40 hours a week weekly and was paid $20.00 an hour. She also received 4 percent trip pay. Because she worked for more than three years but less than 4 years, she is entitled to 3 weeks’ pay in lieu of notification.

Sarah’s routine wages for a routine work week are determined:

$ 20.00 an hour X 40 hours a week = $800.00 a week

Her termination pay is determined:

$ 800.00 X 3 weeks = $2,400.00

Then her getaway pay on her termination pay is determined:

4% of $2,400.00 = $96.00

Finally, her holiday pay is contributed to her termination pay:

$ 2400.00 + $96.00 = $2,496.00

Result: Sarah is entitled to $2,496.00. The employer must also make sure continued protection for any benefit or pension that used to her for three weeks.

Example: No routine work week

Gerry has operated at an assisted living home for 4 years. He works weekly, however his hours differ from week to week. His rate of pay is $25.00 an hour, and he is paid 6 per cent holiday pay.

Gerry’s employer removed his position and did not give Gerry any written notice of termination. Gerry was ill and off work for two of the 12 weeks right away preceding the day his employment was terminated. Gerry earned $1,800.00 in the 12 weeks before the day on which his work ended.

Gerry is entitled to 4 weeks of termination pay.

Gerry’s average revenues each week are calculated:

$ 1,800.00 for 12 weeks/ 10 weeks (Gerry was off sick for two weeks for that reason these weeks are not consisted of in the computation of average incomes) = $180.00 a week

His termination pay is calculated:

$ 180.00 × 4 weeks = $720.00

Then his holiday pay on his termination pay is determined:

6% of $720.00 = $43.20

Finally, his trip pay is contributed to his termination pay:

$ 720.00 + $43.20 = $763.20

Result: Gerry is entitled to $763.20. The employer must likewise ensure continued protection for any advantage or pension strategies that used to him for four weeks.

When to pay termination pay

Termination pay need to be paid to an employee either seven days after the employee’s employment is terminated or on the worker’s next routine pay date, whichever is later.

Mass termination

Special rules for notice of termination may use in cases of mass termination (when a company is ending 50 or more staff members at its establishment within a four-week period).

Meaning of “establishment”

An “establishment” is an area at which the company carries on service. Separate places can be thought about one establishment if either:

– they are situated within the exact same town, or

– an employee at one location has legal seniority rights that encompass the other location, enabling the employee to displace another worker (also called “bumping rights”).

Effective October 26, 2023, in cases of mass termination, the term “establishment” consists of a worker’s home, but only if the staff member works from home and does not work at any other location where the company continues service.

This will require that employees who work specifically from another location be considered for addition in the count when identifying whether 50 or more staff members have actually been ended.

Note that where a worker carries out work both from their home and from another place where the company brings on company (for example, an office), their home is not consisted of in the meaning of “facility”. Instead, the worker is thought about to have a connection to the workplace area and, therefore, for the function of mass termination, the staff member is included with regard to that workplace place.

Example: where several places are considered one “facility”

ABC Company has a workplace and a warehouse located in London, ON. Sabrina resides in London and works for ABC Company exclusively remotely: she carries out work for the company from home and does not operate at the office.

For the function of mass termination, the company’s London office, London storage facility and Sabrina’s London home are considered one “facility.”

Employer commitments in a mass termination

When a mass termination happens, the employer must finish and provide the Form 1 (Notice of termination of work) to the Director of Employment Standards (Director) by:

– e-mail to esa_form1_notice@ontario.ca.

– fax to (416) 326-7061.

– personal delivery to the Director’s workplace on a day and at a time when it is open.

– mail shipment to the Director’s workplace, if the delivery can be validated.

The workplace of the Director of Employment Standards is found on the 9th floor, 400 University Avenue, Toronto ON M7A 1T7.

Any notice to the impacted workers is ruled out to have been offered till the Form 1 is received by the Director; simply put, notification of mass termination is ineffective up until the Director gets the Form 1.

In addition to supplying employees with specific notifications of termination, the employer must, on the very first day of the notification duration:

– publish a copy of the Form 1 offered to the Director in the workplace where it will come to the attention of the affected employees.

– provide a copy of the Form 1 to each affected worker.

The quantity of notice workers should receive in a mass termination is not based on the workers’ length of employment, but on the number of workers who have actually been terminated. A company should give:

– 8 weeks see if the work of 50 to 199 workers is to be terminated

– 12 weeks notice if the employment of 200 to 499 staff members is to be ended

– 16 weeks see if the work of 500 or more staff members is to be ended

Exception to the mass termination rules

The mass termination rules do not apply if these two things apply:

– the variety of workers whose employment is being terminated represents not more than 10 per cent of the staff members who have been used for at least 3 months at the facility

– none of the terminations are brought on by the long-term discontinuance of all or part of the employer’s service at the establishment

Mass termination: resignation by a staff member

A worker who has actually received termination notification under the mass termination rules who wishes to resign before the termination date provided in the company’s notification need to offer the employer at least one week’s composed notice of resignation if the worker has actually been utilized for less than two years. If the work period has been 2 years or more, the staff member needs to provide a minimum of two weeks’ written notice of resignation. However, the employee does not need to give notification of resignation if the employer constructively dismisses the employee or breaches a term of the contract.

Temporary work after termination date in notification

A company can provide work to a worker who has actually been offered notice of termination on a momentary basis in the 13-week duration after the termination date set out in the notice without affecting the initial date of the termination and without being required to offer any further notification of termination to the staff member when the temporary work ends.

If an employee works beyond the 13-week duration after the termination date and after that has their work ended, the worker will be entitled to a new written notice of termination as if the previous notification had actually never been given. The worker’s period of employment will then also include the period of short-term work.

Recall rights

A “recall right” is the right of a staff member on a layoff to be recalled to work by their employer under a term or condition of work. This right is frequently found in cumulative arrangements.

An employee who has recall rights and who is entitled to termination pay because of a layoff of 35 weeks or more may select to:

– keep their recall rights and not be paid termination pay (or severance pay, if they were entitled to severance pay) at that time;
or

– quit their recall rights and referall.us receive termination pay (and discontinuance wage, if they were entitled to severance pay).

If a worker is entitled to both termination pay and discontinuance wage, they must make the very same option for both.

If a staff member who is not represented by a trade union chooses to keep their recall rights or fails to choose, the company should send the amount of the termination pay (and discontinuance wage, if any) to the Director of Employment Standards, who holds the cash in trust.

If a worker who is represented by a trade union elects to keep their recall rights or fails to choose, the company and the trade union need to try to come to a plan to hold the termination pay (and discontinuance wage, if any) in trust for the employee. If they can not concern a plan, and the trade union recommends the employer and the Director of Employment Standards in writing that efforts have actually stopped working, the company should send the termination pay (and severance pay, if any) to the Director of Employment Standards, who holds the cash in trust.

If a staff member selects to quit their recall rights or if the recall rights expire, the cash that is held in trust needs to be sent to the worker.

If the worker accepts a recall back to work, the money that is kept in trust will be returned to the employer.

Exemptions to observe of termination or termination pay

A lot of these exemptions are complex. Please get in touch with the Employment Standards Information Centre, 1-800-531-5551, if you need more details. Please likewise refer to the unique rule tool.

The notification of termination and termination pay requirements of the ESA do not use to a worker who:

– is guilty of wilful misconduct, disobedience or wilful neglect of responsibility that is not minor and has actually not been excused by the company. Note: “wilful” consists of when a staff member planned the resulting consequence or acted recklessly if they knew or ought to have known the effects their conduct would have. Poor work conduct that is unintentional or unintended is typically not considered wilful;

– was hired for a specific length of time or up until the conclusion of a particular job. However, such an employee will be entitled to discover of termination or termination pay if:- the work ends before the term expires or the job is finished; or

– the term expires or the task is not finished more than 12 months after the work started; or

– the work continues for three months or more after the term expires or the task is completed;

See likewise: Employment Standards Self-Service Tool

Wrongful dismissal

Rights greater than ESA notice of termination, termination pay, discontinuance wage

The guidelines under the ESA about termination and severance of work are minimum requirements. Some employees might have rights under the typical law that are greater than the rights to notice of termination (or termination pay) and severance pay under the ESA. A staff member may wish to sue their previous employer in court for “wrongful termination”. Employees should be mindful that they can not take legal action against an employer for wrongful termination and submit a claim for termination pay or discontinuance wage with the ministry for the same termination or severance of employment. An employee should choose one or the other. Employees may want to get legal recommendations concerning their rights.