Termination Of Employment

A number of expressions are typically utilized to describe situations when work is terminated. These include «let go,» «discharged,» «dismissed,» «fired» and «completely laid off.»

Under the Employment Standards Act, 2000 (ESA) a person’s employment is ended if the employer:

– dismisses or stops using a worker, including where a worker is no longer utilized due to the personal bankruptcy or insolvency of the employer;

– «constructively» dismisses a staff member and the staff member resigns, in reaction, within a reasonable time;

– lays a staff member off for a period that is longer than a «short-term layoff».

In many cases, when an employer ends the work of a staff member who has actually been continuously used for 3 months, the company should provide 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 equivalent the length of notification the staff member is entitled to receive).

The ESA does not need an employer to offer a worker a reason their work is being ended. There are, however, some circumstances where a company can not end an employee’s employment even if the employer is prepared to provide correct written notification or termination pay. For instance, a company can not end somebody’s work, or punish them in any other way, if any part of the reason for the termination of work is based on the staff member asking concerns about the ESA or working out a right under the ESA, such as declining to work in excess of the everyday or weekly hours of work optimums, or taking a leave of lack defined in the ESA. Please see the chapter on reprisals.

Getting approved for termination notice or pay in lieu

Certain employees are not entitled to observe of termination or termination pay under the ESA. Examples include: employees who are guilty of wilful misbehavior, disobedience, or wilful neglect of duty that is not unimportant and has actually not been excused by the employer. Other examples include construction workers, staff members on temporary layoff, workers who decline a deal of reasonable alternative work and staff members who have been utilized less than three months.

There are a number of other exemptions to the termination of work provisions of the ESA. See «Exemptions to see of termination or termination pay.» Please also describe the special rule tool.

The termination-of-employment rules are totally separate from any entitlements an employee may need to be paid severance pay under the ESA.

Constructive termination

A useful dismissal may take place when an employer makes a significant change to a fundamental term or condition of a staff member’s work without the staff member’s real or implied authorization.

For example, a staff member might be constructively dismissed if the employer makes modifications to the staff member’s terms of work that result in a substantial reduction in income or a significant negative modification in such things as the worker’s work area, hours of work, authority, or position. Constructive dismissal might likewise include situations where a company pesters or abuses a worker, or an employer provides a worker a final notice to «quit or be fired» and the employee resigns in response.

The employee would have to resign in response to the change within an affordable period of time in order for the employer’s actions to be considered a termination of employment for functions of the ESA.

Constructive dismissal is a complex and difficult topic. For more info on useful dismissal, please contact the Employment Standards Information Centre at 1-800-531-5551.

Temporary layoff

A worker is on short-term layoff when a company cuts back or stops the staff member’s work without ending their employment (for instance, laying someone off at times when there is not sufficient work to do). The simple fact that the employer does not define a recall date when laying the worker off does not always suggest that the lay-off is not short-lived. Note, however, that a lay-off, even if meant to be momentary, may result in constructive termination if it is not permitted by the work contract.

For the functions of the termination arrangements of the ESA, a «week of layoff» is a week in which the staff member made less than half of what they would generally make (or makes typically) in a week.

A week of layoff does not include any week in which the worker did not work for one or more days since the staff member was unable or available to work, underwent disciplinary suspension, or was not offered with work because of a strike or lockout at their location of work or in other places.

Employers are not required under the ESA to provide workers with a composed notification of a short-lived layoff, nor do they need to offer a factor for the lay-off. (They may, however, be needed to do these things under a cumulative arrangement or an employment agreement.)

Under the ESA, a «temporary 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 successive weeks, but less than 35 weeks of layoff in any period of 52 consecutive weeks, where:- the worker continues to receive considerable payments from the employer;
or

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

– the employee receives additional unemployment advantages;
or

– the worker would be entitled to receive extra welfare however isn’t getting them since they are used in other places;
or

– the company remembers the worker to work within the time frame authorized by the Director of Employment Standards;
or

– the employer remembers the worker 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 an employee who is represented by a trade union within the time set out in an arrangement between the union and the employer.

If a worker is laid off for a duration longer than a momentary layoff as set out above, the employer is thought about to have terminated the worker’s work. Generally, the worker will then be entitled to termination pay.

Written notice of termination and termination pay

Under the ESA, an employer can end the work of a staff member who has been used continuously for 3 months or more if either:

– the employer has offered the worker correct composed notice of termination and the notice period has actually ended

– the employer pays termination pay to the staff member where no composed notice or less notice than is required is provided

Written notification of termination

An employee is entitled to discover of termination (or termination pay instead of notification) if they have actually been continually utilized for at least three months. A person is thought about «used» not just while they are actively working, however also during at any time in which they are not working however the work relationship still exists (for example, time in which the employee is off ill or on leave or on lay-off).

The amount of notification to which a worker is entitled depends upon their «period of employment«. A staff member’s duration of work includes not only all time while the worker is actively working however likewise whenever that they are not working however the work relationship still exists, with the following exceptions:

– if a lay-off goes on longer than a temporary lay-off, the worker’s work is considered (or thought about) to have actually been terminated on the first day of the lay-off-any time after that does not count as part of the worker’s duration of employment, even though the staff member may still be employed for functions of the «continually used for 3 months» certification

– if 2 different durations of work are separated by more than 13 weeks, only the most current period counts for functions of notice of termination

It is possible, in some situations, for an individual to have actually been «continuously employed» for three months or more and yet have a period of employment of less than 3 months. In such situations, the worker would be entitled to see because an employee who has actually been continually employed for a minimum of 3 months is entitled to see, and the minimum notice privilege of one week uses to a worker with a period of employment of any length less than one year.

The following chart specifies the amount of notice required:

Note: Special guidelines figure out the quantity of notification required in the case of mass terminations – where the work of 50 or more employees is terminated at an employer’s facility within a four-week period.

Requirements during the statutory notice period

During the statutory notification period, a company must:

– not minimize the worker’s wage rate or modify any other term or condition of work;

– continue to make whatever contributions would be required to preserve the employee’s advantages strategies; and

– pay the employee the earnings they are entitled to, which can not be less than the worker’s regular earnings for a routine work week every week.

Regular rate

This is an employee’s rate of spend for each non-overtime hour of operate in the employee’s work week.

Regular incomes

These are incomes besides overtime pay, holiday pay, public vacation pay, premium pay, domestic or sexual violence leave pay, termination of project pay, termination pay and discontinuance wage and specific legal entitlements.

Regular work week

For an employee who normally works the exact same variety of hours every week, a regular work week is a week of that many hours, not including overtime hours.

Some employees do not have a regular work week. That is, they do not work the very same number of hours every week or they are paid on a basis besides time. For these employees, the «routine incomes» for a «regular work week» is the average quantity of the regular earnings earned by the worker in the weeks in which the worker worked during the duration of 12 weeks instantly preceding the date the notice was offered.

An employer is not allowed to arrange an employee’s trip time throughout the statutory notification period unless the employee-after receiving composed notification of termination of employment-agrees to take their holiday time during the notice period.

If a company offers longer notification than is required, the statutory part of the notification period is the tail end of the period that ends on the date of termination.

How to provide written notification

For the most part, written notice of termination of employment should be resolved to the employee. It can be offered face to face or by mail, fax or e-mail, as long as shipment can be confirmed.

There are special guidelines for offering notification of termination if an employee has an agreement of employment or a collective contract that offers seniority rights that permit a staff member who is to be laid off or whose employment is to be ended to displace (» bump») other workers.

In that case, the company needs to publish a notification in the office (where it will be seen by the staff members) setting out the names, seniority and job category of those staff members the employer plans to terminate and the date of the proposed termination. The publishing of the notice is considered to be notice of termination, as of the date of the publishing, to an employee who is «bumped» by an employee named in the notification. However, this notification of termination should still fulfill the length requirements set out in the ESA.

There are likewise unique guidelines relating to how notification is supplied when there is a mass termination.

Termination pay

A staff member who does not receive the written notice required under the ESA should be provided termination pay in lieu of notification. Termination pay is a lump sum payment equivalent to the regular earnings for a routine work week that a staff member would otherwise have been entitled to during the written notification period. An employee earns trip pay on their termination pay. Employers need to likewise continue to make whatever contributions would be needed to preserve the benefits the staff member would have been entitled to had they continued to be used through the notification period.

Example: Regular work week

Sarah has worked for 3 and a half years. Now her job has been gotten rid of and her work has been terminated. Sarah was not given any written notification of termination.

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

Sarah’s routine salaries 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 calculated:

4% of $2,400.00 = $96.00

Finally, her getaway pay is included to her termination pay:

$ 2400.00 + $96.00 = $2,496.00

Result: Sarah is entitled to $2,496.00. The company should also make sure continued coverage for any advantage or pension that applied to her for 3 weeks.

Example: No regular work week

Gerry has operated at a nursing home for four 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 vacation pay.

Gerry’s company removed his position and did not offer Gerry any written notification of termination. Gerry was ill and off work for 2 of the 12 weeks right away preceding the day his employment was terminated. Gerry made $1,800.00 in the 12 weeks before the day on which his employment ended.

Gerry is entitled to 4 weeks of termination pay.

Gerry’s typical incomes each week are computed:

$ 1,800.00 for 12 weeks/ 10 weeks (Gerry was off ill for 2 weeks for that reason these weeks are not included in the computation of typical profits) = $180.00 a week

His termination pay is calculated:

$ 180.00 × 4 weeks = $720.00

Then his vacation pay on his termination pay is computed:

6% of $720.00 = $43.20

Finally, his getaway pay is added to his termination pay:

$ 720.00 + $43.20 = $763.20

Result: Gerry is entitled to $763.20. The company needs to likewise make sure continued coverage for any benefit or referall.us pension plans that applied to him for four weeks.

When to pay termination pay

Termination pay must be paid to a staff member either seven days after the staff member’s employment is ended or on the staff member’s next routine pay date, whichever is later.

Mass termination

Special rules for notice of termination may apply in cases of mass termination (when an employer is terminating 50 or more employees at its establishment within a four-week duration).

Meaning of «facility»

An «establishment» is a place at which the employer continues organization. Separate areas can be thought about one facility if either:

– they are located within the exact same town, or

– a worker at one area has legal seniority rights that encompass the other area, permitting the employee to displace another worker (likewise called «bumping rights»).

Effective October 26, 2023, in cases of mass termination, the term «establishment» consists of a staff member’s home, but only if the staff member works from home and does not work at any other place where the employer carries on company.

This will need that workers who work specifically remotely be thought about for inclusion in the count when identifying whether 50 or more workers have been terminated.

Note that where an employee performs work both from their home and from another location where the employer continues service (for example, an office), their home is not consisted of in the definition of «establishment». Instead, the employee is considered to have a connection to the office location and, therefore, for the purpose of mass termination, the staff member is included with regard to that workplace place.

Example: where multiple areas are considered one «facility»

ABC Company has an office and a storage facility situated in London, ON. Sabrina resides in London and works for ABC Company exclusively remotely: she carries out work for the business from home and does not operate at the office.

For the purpose of mass termination, the company’s London workplace, London warehouse and Sabrina’s London home are considered one «establishment.»

Employer obligations in a mass termination

When a mass termination takes place, the company must finish and provide the Form 1 (Notice of termination of employment) to the Director of Employment Standards (Director) by:

– email 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 delivery to the Director’s office, if the delivery can be verified.

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

Any notice to the affected workers is ruled out to have actually been given until the Form 1 is received by the Director; in other words, notification of mass termination is not reliable until the Director gets the Form 1.

In addition to supplying employees with specific notices of termination, the employer must, on the first day of the notification period:

– publish a copy of the Form 1 supplied to the Director in the office where it will come to the attention of the impacted staff members.

– supply a copy of the Form 1 to each impacted staff member.

The amount of notice workers must receive in a mass termination is not based upon the employees’ length of employment, however on the number of workers who have been ended. An employer needs to give:

– 8 weeks notice if the work of 50 to 199 workers is to be ended

– 12 weeks notice if the employment of 200 to 499 employees is to be terminated

– 16 weeks notice if the work of 500 or more employees is to be terminated

Exception to the mass termination rules

The mass termination rules do not apply if these 2 things use:

– the variety of workers whose employment is being terminated represents not more than 10 percent of the staff members who have been utilized for a minimum of three months at the facility

– none of the terminations are triggered by the irreversible discontinuance of all or part of the employer’s organization at the establishment

Mass termination: resignation by a staff member

An employee who has gotten termination notice under the mass termination guidelines who desires to resign before the termination date provided in the employer’s notification need to provide the company a minimum of one week’s composed notification of resignation if the worker has actually been used for less than two years. If the employment duration has been 2 years or more, the employee should offer a minimum of 2 weeks’ written notification of resignation. However, the employee does not have to provide notification of resignation if the company constructively dismisses the employee or breaches a regard to the contract.

Temporary work after termination date in notification

An employer can supply work to an employee who has been notified of termination on a temporary basis in the 13-week duration after the termination date set out in the notice without impacting the original date of the termination and without being needed to supply any additional notice of termination to the employee when the momentary work ends.

If an employee works beyond the 13-week duration after the termination date and then has their work terminated, the worker will be entitled to a new written notice of termination as if the previous notice had never ever been provided. The worker’s duration of employment will then likewise 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 of employment. This right is commonly discovered in collective arrangements.

A worker who has recall rights and who is entitled to termination pay due to the fact that of a layoff of 35 weeks or more might 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

– give up their recall rights and receive termination pay (and severance pay, if they were entitled to severance pay).

If a worker is entitled to both termination pay and severance pay, they need to make the exact same option for both.

If a worker who is not represented by a trade union elects to keep their recall rights or fails to make a choice, the company should send the quantity of the termination pay (and severance pay, if any) to the Director of Employment Standards, who holds the money in trust.

If a staff member who is represented by a trade union elects to keep their recall rights or fails to make a choice, the company and the trade union must 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 pertain to an arrangement, and the trade union encourages the company and the Director of Employment Standards in composing that efforts have actually stopped working, the company should send the termination pay (and discontinuance wage, if any) to the Director of Employment Standards, who holds the money in trust.

If a staff member picks to give up their recall rights or if the recall rights expire, the cash that is held in trust must be sent to the staff member.

If the worker accepts a recall back to work, the cash that is held in trust will be gone back to the employer.

Exemptions to notice of termination or termination pay

Many of these exemptions are complicated. Please get in touch with the Employment Standards Information Centre, 1-800-531-5551, if you need more information. Please also describe the unique guideline tool.

The notice of termination and termination pay requirements of the ESA do not use to an employee who:

– is guilty of wilful misbehavior, disobedience or wilful overlook of responsibility that is not unimportant and has not been condoned by the company. Note: «wilful» consists of when a worker intended the resulting effect or acted recklessly if they understood or need to have understood the impacts their conduct would have. Poor work conduct that is unexpected or unintentional is normally not thought about wilful;

– was worked with for a particular length of time or till the completion of a particular job. However, such a worker will be entitled to discover of termination or termination pay if:- the work ends before the term ends or the job is completed; or

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

– the work continues for 3 months or more after the term ends or the task is finished;

See likewise: Employment Standards Self-Service Tool

Wrongful termination

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

The guidelines under the ESA about termination and severance of work are minimum requirements. Some staff members might have rights under the typical law that are greater than the rights to see of termination (or termination pay) and severance pay under the ESA. A staff member may wish to sue their former company in court for «wrongful dismissal». Employees need to know that they can not take legal action against an employer for wrongful termination and file a claim for termination pay or discontinuance wage with the ministry for the very same termination or severance of work. A staff member must select one or the other. Employees may wish to obtain legal guidance worrying their rights.