Ontario Win: Director Wins 4 Months’ Severance After Less Than 8 Months on the Job

Samfiru Tumarkin LLP secured four months’ severance for an Ontario distribution director who had worked for his employer for less than eight months. The final result was a $45,358.41 compensation balance, plus $7,250 in legal costs.

Antonio Marques was 48 when Delmar International Inc. let him go from his role as Director of Warehousing and Distribution. He had joined the company with a $185,000 salary and a senior management position. Less than a year later, he was out of work.

Marques was represented by Alex Lucifero of our Ottawa employment law team.

The Employer Tried to Limit What Counted as Pay

Delmar argued that the car allowance only covered work-related driving expenses. Since Marques was no longer driving for the company, it said those payments should stop.

The company also argued that he could not receive the promised bonus because he was no longer working there on his first anniversary.

Finally, Delmar pointed to his success finding another job. Marques started a comparable position about three and a half months after his dismissal.

How Our Team Secured Four Months’ Severance

The wording of Marques’ agreement mattered. It listed the car allowance under compensation. Delmar relied on a separate company policy, but had not attached it to the executive employment agreement or provided it before he signed. The court agreed that the allowance was part of his pay and had to be included.

The judge also rejected the idea that finding work quickly should determine the length of his severance. That assessment depended on his circumstances when he lost his job, including his age, management role and time with the company. Earnings from a new job are a separate consideration that can reduce the amount payable.

After reviewing those factors and comparable cases, the court awarded four months’ severance.

Read the full court decision: Marques v. Delmar International, 2016 ONSC 3448.

What This Means For You

• A short time on the job can still mean months of severance. Your years of service are only one part of the calculation.
• Your salary may not be the whole picture. Car allowances and other parts of your compensation can affect your severance pay in Ontario.
• Have the offer reviewed before signing a release. You could be giving up the chance to recover more.

A Lesson For Employers

Be clear about what your employment agreements promise. In this case, a separate company policy did not override the agreement’s treatment of the car allowance as compensation.

Related client win: Our team also secured six months’ severance for an Ontario tow truck driver who had been treated as a contractor.

Let Go Before Your First Work Anniversary?

Do not assume a few months of work means you should accept a few weeks’ pay. Our Ontario employment lawyers can review your offer and explain what you may be owed.

Executive severance pay in Ontario can be as much as 24 months’ pay, depending on your circumstances. Before you sign, always check first.