The loss of your job in can be devastating to you and your family. If you've been unexpectedly let go, you might be wondering exactly what your rights are as an employee. Is your employer even legally allowed to fire you? How much severance pay are you entitled to, if any? Have you been the victim of discrimination?
Provincial regulations vary, but every employee and employer in Canada has the right to end an employment contract for any legal reason. However, there are certain obligations your employer has to meet if they want to dismiss you from your position. To determine what those obligations are, you first need to figure out whether you've been dismissed with or without cause.
Dismissal With or Without Cause
Dismissal with cause generally requires some kind of misconduct on your part as the employee. Dismissal with cause is very serious. If you are dismissed with cause, you might not be provided with any notice or a severance package. You may also be ineligible to collect employment insurance while you search for another job. However, your employer must be able to prove that your misconduct was so serious that it was reasonable to let you go on the spot without providing fair notice. Often, this means repeated attempts by your employer to correct your behavior or a serious breach of your employment contract. Every circumstance is different, however, so it's best to contact a lawyer to determine if your employer was justified in dismissing you with cause.
Dismissal without cause happens when your employer lets you go without any misconduct on your part. Both you and your employer have the right to end your employment at any time for any lawful reason. It could be for something as simple as just not liking you or hiring someone better suited to the position. However, your employer is required by law to give you fair notice or pay in lieu of that notice if they are dismissing you without cause.
You might be surprised to learn that your employer has the option to give you working notice of your termination, where you continue working for a specified amount of time before your employment ends. Most employers choose to terminate employment immediately and offer a severance package instead. This package is actually your employer paying damages to you for their failure to provide you with sufficient notice.
The amount of notice you're entitled to can vary greatly depending on factors including, but not limited to, your province, the length of your employment, the circumstances of your dismissal, and the current job market, so it's important to consult a lawyer before signing anything from your employer. Often, an employer may only offer the bare minimum required by legislation when in reality you could be entitled to a much larger severance package.
Constructive Dismissal
Constructive dismissal describes situations where your employer has not directly fired you, but instead changed or intends to change the terms of your employment in some way. This is done without your consent, essentially forcing you to either quit or accept the changes. This could mean anything from a change in salary or hours worked, to a drastic change in your job responsibilities, or any failure on your employer's part to uphold the terms of your employment in a significant way (like withholding benefits). You have the option to either accept the new terms, or treat your employment as terminated. In cases of constructive dismissal, your termination is considered a dismissal or “quitting with cause”, not a resignation, so you still qualify for a severance package.
If you feel that your employer has failed to uphold their end of your employment agreement in some way, it's important to consult with a lawyer before resigning. You may need to gather proof that your employer is constructively dismissing you, and a lawyer will be able to help guide you through the process.
A Note on Illegal Dismissal
If your employer dismisses you, it must be for a legal reason. They can't let you go for discriminatory reasons (including your gender, ethnicity, pregnancy, or any other factor outlined in the Human Rights Code[1]) or for speaking up about your rights according to the Employment Standards Act[2] or the Occupational Health and Safety Act[3]. If you believe you have been illegally dismissed, you should consult a lawyer right away. You may have the right to be reinstated in your position or have the ability to pursue remedies not available in other wrongful dismissal cases.
Wrongful Dismissal
If you believe your dismissal was handled incorrectly, a wrongful dismissal action may be helpful in achieving a fair severance package that compensates you for the working notice you should have received. However each case is different and you should always seek the advice of a lawyer before making the decision to sue or not to sue.
One very important thing to note is that you have a duty to mitigate the damages caused by the termination of your employment. In other words, you have an obligation to try to find other work in your field after losing your job. It's important to document your job search so you can prove that you've taken reasonable steps to find comparable employment while awaiting the result of your wrongful dismissal action. The purpose of fair notice is to give you enough time to find another job, so if you do find work before your fair notice time is up, any earnings you receive could be deducted from your final settlement.
A settlement in a wrongful dismissal case is not meant as a reward for your service to your employer, or as a punishment to your employer for dismissing you. It's simply compensation for your employer's failure to give you fair notice. However, you may also be eligible to claim other types of damages from your employer if they acted in bad faith.
Moral and punitive damages might apply in cases where your employer acted in a malicious or insensitive way when they dismissed you, to the point of causing you great harm. It's normal to feel emotional distress at the prospect of being fired, but if your employer goes out of their way to humiliate you, attempts to damage your future job prospects, or wrongfully accuses you of misconduct they may be required to pay you damages. Moral and punitive damages are meant to punish the employer for bad behaviour, and only apply in serious circumstances. If you're not sure if this applies to your situation, it's best to consult with a lawyer.
It's important to remember that most wrongful dismissal actions never reach the inside of a court room. Most employers are willing to negotiate a fair settlement without involving the courts. This settlement will also often include at least a partial payment of your legal fees.
What To Do If You've Been Wrongfully Dismissed
Once you've been dismissed from your job, your next steps are critical.
- Contact a lawyer. Find an experienced employment lawyer who can guide you through the process. In some cases, the severance package your employer offers may be so good you're advised to take it. Most of the time, your lawyer will be able to help you negotiate a better settlement.
- Document everything. Get your dismissal in writing if possible, and write down everything you can think of that happened in the days and months leading to your dismissal that you think might be relevant. Bring along any documents you might have, including anything you signed from your employer, to your first lawyer visit.
- Begin negotiations. Most contact will happen between your former employer's lawyer and your own, through email, phone calls, and face to face meetings. If both sides have good counsel, you should be able to come to a resolution in the early stages without having to go to court.
- Take legal action. If you can't come to an acceptable negotiation in the early stages, it might be time to file for wrongful dismissal or take other legal action (like complaining to the labour board or filing a human rights complaint). It's uncommon for a wrongful dismissal case to make it all the way to the final stages. More often, your employer will be willing to settle out of court for an appropriate amount.
Losing your job can be a scary experience filled with uncertainty. Your employer may have the right to fire you, but they don't have the right to mistreat you. As long as you didn't break any legal company rules or otherwise violate your end of the employment agreement, your employer must give you an appropriate amount of notice or pay in lieu of notice when they dismiss you.
Employment law is very complicated and each circumstance is unique, so it's important to seek counsel with an experienced lawyer if you're unsure about any aspect of your dismissal or the amount of severance you're entitled to. It's important to have an advocate who will work for you to negotiate the best deal possible for your situation!
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[1] Human Rights Code, R.S.O. 1990, c. H.19
[2] Employment Standards Act, 2000, S.O. 2000, c. 41
[3] Occupational Health and Safety Act, R.S.O. 1990, c. O.1
[4] Canada Labour Code (R.S.C., 1985, c. L-2)
About the Author: Tyrone Krawetz has a general practice with an emphasis on criminal defence and labour and employment law.