Severance Pay Ontario Differ For Unionized Employees
Losing a job is a stressful time, whether you saw it coming or were caught off guard. There are many issues to deal with, including how you’ll find another one and what you’ll do about your finances in the meantime. The experience can also be confusing, especially if you’re entitled to severance pay. This payment is meant to provide financial support while you search for a new job and can make all the difference. However, there are a lot of misconceptions about severance pay ontario. It’s important to understand how it differs from termination pay and what requirements you must meet to qualify.
Termination pay is what an employer must offer to a non-unionized employee when they terminate them or lay them off. Severance pay is a separate compensation that employers of certain sizes are required to provide in the event they must sever an employee’s employment. It’s often called a severance package, termination package or severance agreement. Generally, it is offered to employees who are terminated without cause and is intended to offer them a financial safety net until they find a new job.
The amount of severance pay Ontario is determined by the length of an employee’s tenure with the company. The minimum severance pay in Ontario is one week of wages for every year of service up to a maximum of 26 weeks. This only applies to employers with a payroll of $2.5 million or more.
How Does Severance Pay Ontario Differ For Unionized Employees?
If you’re a unionized employee, your severance package will depend on the terms of your contract. It will likely include all forms of compensation you received during your employment, such as a salary, bonus, vacation, car allowance or commissions. However, you can restrict what compensation is included in your severance package by using a carefully drafted employment contract.
Employers must also consider other factors when determining severance pay, such as the employee’s age, position, salary, and the availability of similar employment opportunities. These factors can impact the amount of severance pay owed to the employee and may require consultation with legal professionals to ensure compliance with the law.
In addition, non-unionized employees may be entitled to severance payments from their employers if they are fired for cause. This is the highest standard for an employer to meet and typically requires that an employee has committed more than one misconduct. The Ministry of Labour and courts typically require that an employer have good cause before they can fire someone and not have to pay them severance.
Some employees are not covered by the minimum severance pay set out in the ESA, including federal workers, individuals employed through a college work program, and those who hold political, judicial or religious positions. An experienced employment lawyer can review the terms of your contract and advise you on your entitlements.