Ottawa approves $20B Rogers-Shaw deal: Employee rights

The largest takeover in Canadian telecom history has passed its final regulatory hurdle.

In a statement and news conference on March 31, Federal Industry Minister François-Philippe Champagne announced that Ottawa is allowing Rogers Communications to complete its acquisition of Shaw Communications for approximately $20-billion — with a number of conditions attached.

The deal includes the sale of Shaw’s Freedom Mobile, Canada’s fourth-largest wireless carrier, to Montreal-based Videotron for more than $2.8-billion.

“Today, I am informing Canadians that I have secured on their behalf unprecedent and legally binding commitments from Rogers and Videotron,” Champagne said.

He added that transferring Freedom Mobile’s spectrum licenses to Videotron “will ensure that this new national fourth player will be in it for the long haul, be able to go toe-to-toe with the big three, and actually drive down prices across Canada.”

The federal government’s long-awaited decision ends a lengthy review that began after Rogers beat out Bell-parent BCE Inc. in a bidding war for Shaw in March 2021.

Champagne added that his department will launch a review of Canada’s spectrum transfer framework — noting that one hasn’t been conducted in nearly a decade.

SEE ALSO
• RBC buying HSBC Canada for $13.5B: Employee rights
• Apotex bought by SK Capital: Employee rights
• Telus buys LifeWorks for $2.9 billion: Employee rights

Conditions for Rogers

As part of the agreement, Champagne said Rogers will be subject to strict and legally binding commitments that require the telecom giant to “make major investments to improve connectivity within the next five years”, including:

• Creating 3,000 new jobs in Western Canada and maintaining them for a minimum of 10 years after the closing date
• Establishing a Western headquarters in Calgary and maintaining it for a minimum of 10 years after the closing date
• Investing $1 billion to expand broadband Internet access and 5G mobile service in areas where it isn’t currently available
• Investing at least $2.5 billion to enhance its 5G network in Western Canada, and $3 billion in additional network service expansion projects
• Expanding access to low-cost broadband Internet plans and launching a new low-cost mobile offering for low-income Canadians

Rogers has reportedly agreed to pay a $1-billion penalty if the company doesn’t keep its commitments.

Conditions for Videotron

As Videotron acquires Freedom Mobile, Champagne said the telecom company has agreed to a variety of conditions, including:

• Offering plans that are comparable to those currently available in Quebec
• Offering options at least 20 per cent cheaper than those available by the major players
• Keeping Freedom Mobile licences for a period of 10 years
• Expanding its 5G wireless network in Freedom Mobile’s pre-existing operating territory within two years
• Increasing data allotments of existing Freedom Mobile customers by 10 per cent as a near-term bonus while working to bring down overall prices

Videotron has reportedly agreed to pay $200-million if it breaks its promises.

My employer sold the business, who pays severance if the new owner doesn’t want to keep me?

In Canada, the seller of the business must provide non-unionized employees with full severance pay if they lose their job as a result of the sale.

• Example: Shaw sells Freedom Mobile to Videotron. A Freedom Mobile employee in Ontario loses his job as a result of the sale. Since Shaw is the seller of the business, the telecom company is responsible for providing severance to the affected worker.

WATCH: Employment lawyer Lior Samfiru explains the rights workers have when their employer sells the business on an episode of the Employment Law Show.

If you receive an employment offer from the new owner, and have a good reason for why you don’t want to accept it (i.e. different hours or pay), you can still get full severance from the person of group that sold the company.

Even if you don’t have a good reason for turning down the offer, you can still get a severance package.

However, it’s very likely that you will only receive the minimum amount of compensation required under federal and provincial legislation.

ADDITIONAL RESOURCES
• Sale of business in Ontario: Rights to severance
• Rights to severance in Alberta when your employer sells the business
• Employer sold the business in B.C.? Know your rights to severance

How is severance pay calculated?

In Canada, severance for non-unionized employees can be as much as 24 months’ pay.

This includes individuals working full-time, part-time, or hourly in Ontario, Alberta and B.C.

The amount of compensation you are entitled to is calculated using several factors, including:

• Age
• Position at the company
• Length of service
• Ability to find new work

Our firm’s free Severance Pay Calculator can help you figure out how much you are owed.

If your company doesn’t provide you with the correct amount, you have been wrongfully dismissed and should contact Samfiru Tumarkin LLP immediately.

Our experienced employment lawyers regularly resolve wrongful dismissal claims and can help you secure proper severance.

LEARN MORE
• Severance pay in a recession
• Rights to severance for federally regulated employees
• Severance for provincially regulated employees

Can the new owner of the business make major changes to my job?

In Canada, non-unionized employees don’t have to accept major changes to their job that the new owner of the business might try to enforce.

Large modifications, such as a demotion, longer shifts, or reduced pay, are illegal.

When significant adjustments are made to the terms of your employment without your consent, it’s very likely that you can treat it as a constructive dismissal.

In this situation, the law allows you to quit your job and seek full severance pay.

However, you shouldn’t resign before speaking with an experienced employment lawyer at Samfiru Tumarkin LLP.

We can confirm that you have been constructively dismissed, assess your legal options, and help you secure the compensation you deserve.

LEARN MORE
• Can your employer make changes to your job in Ontario?
• Changes to your employment in B.C.: Your rights
• What happens when your job is changed in Alberta?

The new owner is asking me to sign a new employment contract, what should I do?

If the new owner of the business provides you with an employment contract, don’t sign anything before seeking legal counsel.

In most cases, these agreements take away key protections that would otherwise be available to you, including:

• Ignoring past service: The new owner might attempt to reduce or ignore your years of service with your previous employer. Don’t sacrifice your seniority. Length of service is a key factor when determining how much severance pay you are entitled to.
• Termination clause: Some employers try to use a termination clause to reduce your severance entitlements to the bare minimum. Instead of months of pay, you might only receive a few weeks’ pay if you are fired without cause or let go.
• Ability to make changes: The new owner might attempt to add a clause that gives them the right to change aspects of your job (i.e. hours or pay) without your permission or lay you off without penalty.

In Canada, employers can’t legally force non-unionized workers to sign a new employment contract immediately or a few days after receiving it.

Once you receive the agreement, contact Samfiru Tumarkin LLP. We can review it and ensure that your workplace rights are properly protected.

SEE ALSO
• Starting a new job? Here’s how an employment contract could limit your rights
• Employment Law Show: 5 things to know about employment contracts
• Employment Law Show: Things to never do before seeking legal counsel

Received a job offer? Speak with an employment lawyer

Before signing a new employment contract, have the experienced employment law team at Samfiru Tumarkin LLP review the agreement to make sure your workplace rights are protected.

Our lawyers in Ontario, Alberta, and B.C. have successfully represented tens of thousands of non-unionized individuals.

We can can help you better understand the terms of the contract and advise you on how best to navigate the situation.