severance pay, layoff, wrongful termination lawyer

Twitter’s Massive Layoffs – Severance Pay

The recent acquisition of Twitter Inc. (“Twitter”) by Elon Musk has sparked rumors of a company-wide restructuring. With Twitter reportedly planning its first round of layoffs, the employees should seek assistance from a wrongful termination lawyer to learn about their severance entitlements. The article below will discuss the notice entitlements of laid-off workers and how a wrongful termination lawyer can help determine laid-off employees’ severance pay.

Ontario employees laid off permanently by their employers are entitled to certain statutory rights and protections under the Employment Standards Act, 2000 (“ESA”). Most employers in Ontario must comply with the ESA’s  minimum statutory standards, including the notice of termination requirements.  

 

How Layoffs Impact an Employee’s Severance

A layoff is a permanent termination or temporary suspension of an employee’s or a group of employees’ employment for business reasons. Historically, the term ‘layoff’ referred to temporary interruptions of work.

Usually, companies permanently layoff employees due to downsizing or economic downturns. The termination entitlements of the laid-off employees depend on the terms of their employment contract, common law, and statutes. 

In most cases, the ESA mandates that an employer terminating an employee without a reason must give them a notice of termination. An employee is entitled to a minimum of one week of notice per year of service up to a maximum of eight weeks. 

Furthermore, if a company carries out massive layoffs, the workers’ notice entitlements will be impacted by the number of workers laid off within the same four-week period. If the employer terminates:

1.       More than fifty to two hundred employees, then employees are entitled to at least eight weeks of notice;

2.     More than two hundred but less than five hundred employees, then employees are entitled to at least twelve weeks of notice; and 

3.     More than five hundred employees, then employees are entitled to at least sixteen weeks of notice. 

 

Are Laid-off Employees Entitled to Severance Pay?

An employee is entitled to severance pay when their employment is severed. Section 63 of the ESA outlines the situations where an employment relationship is severed. An employer severs an employment relationship by:

1.       Laying off an employee for thirty-five weeks or more within a consecutive fifty-two-week period;

2.     Laying off an employee due to the permanent closure of all the business at the establishment;

3.     Dismissing an employee, including where the dismissal is due to the employer’s bankruptcy or insolvency;

4.    Constructively dismissing an employee and the employee provides their resignation in response and within a reasonable period; and

5.     Giving the employee a notice of termination in writing, and the employee subsequently giving two weeks’ notice of their resignation, and the resignation takes effect during the statutory notice period.  

 

Employees working for five years or more before being laid off permanently can be eligible for severance pay on their termination if:

1.       The severance occurred due to the permanent discontinuance of the employer’s business at the establishment, and the employee is one of the fifty or more employees whose employment relationship was severed within six months; or 

2.     The payroll of the employer is $2.5 million or more. 

 

The employees statutory’ severance pay is calculated by multiplying their regular wages for a typical workweek by the total number of completed years of service and the number of whole months of work divided by twelve for an incomplete year. An employee could be entitled to a maximum severance pay of one week’s regular wages for a period of twenty-six weeks. 

 

How a Wrongful Termination Lawyer Can Help

 

Laid-off employees usually rush to accept any severance and termination package their employer offers. Consequently, the employees often walk away with much less than their entitlements and sign away their right to sue for more.

A knowledgeable wrongful termination lawyer can help determine if your employer offered a fair and adequate severance or termination package. They will negotiate with your employer to help you get the severance package you deserve.

A wrongful termination lawyer will also review your employment contract to determine if it contains an enforceable termination clause. An unenforceable termination clause entitles a terminated employee to common law reasonable notice.

Common law entitles a wrongfully dismissed employee to reasonable notice or pay-in-lieu of notice depending on their characteristics, such as age, the character of employment, length of service, and availability of similar jobs.

A wrongful termination without cause usually entitles an employee to approximately one month of notice pay for every year of service, up to a maximum of twenty-four months. This duration includes the employee’s minimum termination entitlements under the ESA.

A wrongful termination lawyer understands the subtle nuances of employment law and employment contracts. They can use their experience to determine if the layoff amounts to wrongful termination entitling you to common law reasonable notice in addition to the ESA minimums.

Further, if the layoff amounts to wrongful dismissal, your wrongful termination lawyer can send your employer a demand letter demanding common law reasonable notice and damages for wrongful dismissal.

If your employer rejects your proposal for resolution, your wrongful termination lawyer can help you sue your employer for your severance entitlements. A typical civil lawsuit involves different steps, such as the exchange of pleadings, mediation, examinations for discovery, pre-trial conference, and trial.

 

A wrongful termination lawyer can use their experience with the litigation process to help you at each stage of the litigation. They will use their expertise and advocacy skills to help you get your desired result.

 

Conclusion

With a recession around the corner, companies like Twitter are planning massive layoffs. As an employee, you don’t need to accept whatever your employer offers in exchange for a full and final release. You could be entitled to severance pay depending on the length of your employment, your employer’s payroll, and the employment contract terms. Further, you might be entitled to common law reasonable notice if your employer failed to limit your notice entitlements to the ESA minimums.

A wrongful termination lawyer can help you determine your severance entitlements. They can use their skills and expertise to ensure you do not settle for less than your entitlements. If the matter proceeds through a wrongful dismissal lawsuit, they will use their advocacy skills to advance your case in court.

 

Contact Us

If you were laid off by your employer and require any help calculating your severance pay upon termination, our team of experienced employment and wrongful termination lawyers at Achkar Law can help. Contact us by phone toll-free at +1 (800) 771-7882 or email us at [email protected], and we would be happy to assist.

If you are a small or medium-sized company looking for full-service support, check out our Chief Legal Officer (CLO) program page for our strategic solutions.

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