Reasons to Have Your Severance Offer Reviewed

by Lia Moody

Monday, June 9th, 2014 at 6:21 pm

Being terminated from your employment (whether you’ve been there for 1 month or 30 years) is downright scary. On top of the shock and disappointment of losing your job, you are then handed an intimidating stack of paperwork which purports to set out your entitlements and, sometimes more importantly, limit your rights.

At the risk of sounding like I am trying to justify our own existence, employment lawyers are here to assist you through this transition. No matter how quickly the company has requested your acceptance of the proposed terms, or how fair the proposed terms appear to be, it is always a good idea to have your severance offer reviewed by an employment lawyer – primarily, for the following reasons:

    1. We can tell you whether the company’s severance offer is what you are entitled to

Perhaps the most important part of any separation package, an employment lawyer can assess whether you are being appropriately compensated by the company as a result of your termination.

Your entitlements are determined by any number of factors, including the existence of an enforceable contract with the company, the Employment Standards Act, your remuneration structure, company policies – and the list goes on. Over and above the payment of your salary over a specific amount of time, you could be entitled to benefit continuation, commissions, overtime, vacation pay, or even your bonus.

    1. We can tell you how the acceptance of the separation package will impact your rights

As a condition of many separation packages, terminated employees are often asked to execute paperwork that releases the company from further obligation and restricts the employees’ rights in the future.

Although usually only 1-2 pages in length, these “release” documents are often about as clear as mud. An employment lawyer can wade through it for and with you, and ensure that you have a full understanding of precisely what rights you are forfeiting. I have seen one release document that stated that the employee was forfeiting any right to ever set foot on any property owned by the company – which, in this particular case, would have left my client housebound. This provision was buried deep within the wording of the release document, and although arguably unenforceable, why would you sign anything without knowing its full impact?

    1. We can tell you if your acceptance of the separation package imposes any obligations

In some instances, a company will impose, as a condition of your separation package, restrictions on your future actions. This can include anything from how and to whom you can disclose the terms of your settlement, to which companies you can apply to for employment (or more importantly, which companies you cannot apply to for employment), to reporting whether or not you are successful in obtaining alternative employment. In this latter case, upon obtaining another job, the company may be allowed to reduce the remaining amount of your severance pay by a certain percentage, or in some cases, pay it back.

    1. We can assist with the transition to new employment

Although under no legal obligation to do so, many companies are willing to provide their terminated employees with outplacement counselling, or to pay some amount of money towards re-training. At the very least, a company should be able to provide you with a letter confirming your employment, or even a reference letter.


We are here to help! If you are interested in a consultation to discuss your severance offer, please contact us here.

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