severance pay be suspended for Federally Regulated Employees
Federally Regulated Employees are those who work for companies that operate in industries and places under the jurisdiction of the federal government. This includes airlines, airports, telecommunication providers and banks. The Canada Labour Code outlines basic labour and workplace rights for these employees.
As of February 1, 2024, changes to the Code will come into effect that will significantly enhance entitlements for federally regulated private sector employees upon termination. These include enhanced notice of termination entitlements which will increase on a graduated scale with each consecutive year of employment, and the right to severance pay.
Many workers who are employed by federally regulated employers, especially those in the private sector, believe that they are only owed a small amount of Federally Regulated Employee severance pay if they are terminated. They are largely incorrect, however, as the case of Wilson v. Atomic Energy of Canada Ltd. established that federally regulated employees are entitled to much the same severance packages as those in unionized environments.
Can severance pay be suspended for Federally Regulated Employees?
The law says that a federally regulated employee is owed severance pay of two days of wages for each full year of continuous employment. This continuity of employment isn’t interrupted by approved absences, a lay-off that doesn’t result in termination, or when an employer dismisses an employee for just cause or the employee quits.
In addition to telecommunication employee severance pay, a severance package for a federally regulated employee must also include common law compensation. This is the value of any other severance package or pay that an employee may be owed from another source, including their employment contract, bonus or vacation pay, pension plan benefits and more. This is important because it can amount to a significant sum of money.
In some cases, negotiating the terms can lead to better outcomes, such as extended severance periods or improved benefits. From the employer’s perspective, offering a comprehensive package that includes a legal release fosters a smoother separation process while mitigating risks.
The Code also requires that an employer provide an affected employee with notice of their termination entitlements in the event of a mass lay-off. This is based on the number of workers affected by the lay-off and the length of time they have worked for the company. For example, if an employer plans to lay off 500 workers in a single establishment, the company must provide each of these employees with 16 weeks’ notice.
Aside from these requirements, there are specific laws in place that prohibit discrimination and harassment in the workplace. If you have been the victim of this type of behaviour, you can seek redress through a wrongful dismissal claim.
If you have been laid off, or terminated, by a federally regulated employer without reason or without receiving the proper severance pay, contact the experienced wrongful termination lawyers at Samfiru Tumarkin LLP. We can determine what you are owed and help you file your claim. Our office is located in Toronto, Ontario. To schedule an appointment, please call or email us. We look forward to hearing from you.
