How much severance am I entitled to?

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How much severance am I entitled to?

In Ontario, the Employment Standards Act sets out the minimum amount of notice and severance that you should receive. Even if you did sign an employment contract, it may be unenforceable. If you did not sign an employment contract, or if the one you signed is unenforceable, then you will be entitled to notice under the “common law”. The common law means case law precedents that were decided in a court.

Under the common law, how much severance you are entitled to depends on a number of factors such as your age, your education level, your workplace experience, the availability of comparable alternative employment, among other things. People often think that they are entitled to one month of severance per year of their employment. For example, if you were employed for 9 years, you would receive 9 months severance. However, there is actually no “rule of thumb” with respect to severance. There is usually a range with respect to how much severance pay someone is entitled to. The range for an employee terminated after 9 years could be from 5 months on the lower end to 14 months severance on the higher end. A person that is 35 years old with an MBA and terrific reemployment prospects, would be in the lower range of severance. A person who is 64 years old with no postsecondary education, would be entitled to the higher end of the range. Further, if you were induced to leave previous employment to join the company you just got terminated from, then the court may add that to the period to be that is being considered for severance.

The maximum severance that a long-term employee is entitled to usually 24 months. There are some cases where more severance has been ordered. They are not common but it is possible in certain circumstances.

Although there is not an exact formula to determine your legal entitlement under the common law, Crangle can help maximize your entitlement. Flexible rates or a contingency agreement may be an option to avoid upfront legal fees.