Cognizant Layoffs 2026: News, Restructuring & Severance Pay in Canada

Cognizant could eliminate upwards of 4,000 jobs in 2026 as part of its $320-million “Project Leap” restructuring plan. CNBC, People Matters, and other news outlets report that approximately $270 million will be set aside for employee-related costs, including severance pay.

Jatin Dalal, CFO of the IT services and consulting company, said the plan will span multiple geographies and business units, potentially affecting Canadian staff.

If you’re a non-unionized worker or manager at Cognizant in Canada, which is a provincially regulated employer, understanding these developments is the first step in ensuring your legal rights are protected during this period of restructuring.

Cognizant Layoffs: A Timeline of Recent Job Cuts

• • Feb. 2025: Cognizant is cutting 10,700 jobs at the same time it expects to increase overall headcount.

• May 2023: Cognizant is releasing 3,500 employees, or approximately 1% of its workforce, amid a slowdown in revenue.

Why is Cognizant Restructuring?

According to reports, Cognizant wants to recalibrate its cost base while investing in artificial intelligence (AI) and digital capabilities.

Project Leap follows earlier cost optimization efforts by the company, including workforce reductions and real estate rationalization.

Your Rights as a Non-Unionized Employee

Whether your departure is labelled a “layoff,” “restructuring,” or a “voluntary package,” your legal rights are governed by Canadian common law.

How Severance Pay Works

For non-unionized staff and managers at Cognizant, severance pay isn’t determined by a single internal policy.

Instead, it’s based on the unique circumstances of your situation:

• The 24-Month rule: Depending on your age, length of service, and the nature of your role, you may be entitled to up to 24 months of severance pay.
• Managerial complexity: For managers, severance must often account for bonuses, RSUs, and stock options.
• Provincially regulated status: Because Cognizant is a provincially regulated employer, specific rules under a province’s employment legislation apply alongside common law standards.

Defining Wrongful Dismissal

A “wrongful dismissal” is a specific legal term. It occurs whenever an employer in Canada terminates a non-unionized worker without “just cause” but fails to provide the proper amount of severance pay.

This isn’t a reflection of the company’s intent, but rather a calculation of whether the package meets the high standards set by Canadian courts.

If an employment contract’s termination clause is unenforceable, or if a “temporary layoff” is implemented without a prior written agreement, an employee may have a claim for full severance.

Recommended Steps for Affected Cognizant Staff

If you’ve been notified of job loss or offered a “voluntary departure” package at Cognizant:

1. Don’t sign anything immediately: You’re legally entitled to a reasonable period to review any offer. Signing a release prematurely can waive your right to pursue full compensation.
2. Use the Severance Pay Calculator: Get an anonymous, instant estimate of your entitlements.
3. Check your compensation: Ensure your offer includes all variable pay, including bonuses and benefits.
4. Seek legal advice: An experienced employment lawyer can ensure that you receive fair compensation.

Cognizant Layoffs: Frequently Asked Questions

Are layoffs at Cognizant permanent?

For non-unionized employees, a layoff is typically treated as a permanent termination of employment requiring full severance.

Can a manager at Cognizant negotiate a better deal?

Yes. Initial offers from large employers often focus on minimum standards rather than full common law entitlements.

Does Cognizant have to include bonuses in severance?

Often yes — especially if bonuses were a regular part of compensation.

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Disclaimer: The materials above are provided as general information about the rights of non-unionized employees in Canada. It is not specific to any one company and SHOULD NOT be read as suggesting any improper conduct on the part of any specific employer, or a relationship between Samfiru Tumarkin LLP and a specific employer.