Domtar shutting down Espanola mill, 450 jobs to be affected

After years of operating losses and high costs, Domtar Corporation (Domtar) is shuttering its Espanola, Ont., pulp and paper mill — affecting approximately 450 employees.

In a news release on Sept. 6, the manufacturer announced that the facility will close in early October. Following the mill’s closure, the paper machines will be “shut down by early November.”

“The Espanola mill has been challenged for some time now,” Steve Henry, president of Domtar paper and packaging, said in the release.

“We have worked diligently to find a viable path forward for the operation, including offering it for sale. Employees affected by this change have earned our appreciation and we thank them for their contributions. We also want to thank federal and provincial officials for their efforts.”

The company added that the facility will remain “indefinitely idle” for an “expected period greater than one year.”

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Major layoffs continue

Domtar’s decision to shutter its pulp and paper mill in the small northern Ontario town comes amid a flurry of layoffs in 2023.

Major North American companies, including SecureWorks, Rapid7, Dell, Telus, Amazon, Microsoft, Rogers, Ritual, and Meta, are significantly scaling back their staffing levels as they continue to navigate challenging economic conditions.

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Employee rights when facilities are closed

As part of the announcement, Domtar said it will take “appropriate measures to assist employees affected by this decision in accordance with the collective agreement, Domtar policy, and legislation.”

For non-unionized workers in Canada, the closure of an office or facility can affect them in a variety of ways:

• Termination with full severance pay: If a non-unionized employee loses their job because their workplace is closed, their employer must provide them with a full severance package. Proper compensation can be as much as 24 months’ pay, depending on various factors. However, it can also consist of working notice.
• Relocation to a new workplace: An employer may decide to move non-unionized workers to a new location. This is something a company can’t do if the change makes the commute longer or more difficult for an employee. In this situation, workers might be able to pursue full severance pay through a constructive dismissal claim.
• New job or duties: Companies may give some non-unionized employees new roles or duties if their original job is impacted by a closure. It’s illegal for employers in Canada to make major modifications to the terms of your employment without your consent. If this happens to you, you could have grounds for a constructive dismissal.

If you are a non-unionized employee at Domtar, and your job is affected by layoffs or closures, contact an employment lawyer at Samfiru Tumarkin LLP immediately to find out what your options are.

ADDITIONAL RESOURCES
• Job changes in Ontario: Employee rights
• Can my employer make changes to my job in Alberta?
• Changes to your employment in B.C.: Your rights

Termination agreements for Domtar employees

In Canada, non-unionized employees at Domtar are owed full severance pay when they lose their jobs due to downsizing, corporate restructuring, or the closure of the business.

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

People working “on contract” or as a contractor may also be owed severance pay — given that many employees in Canada are often misclassified as independent contractors.

LEARN MORE
• Rights to severance for provincially regulated employees
• Severance entitlements during mass layoffs
• Severance pay in a recession

WATCH: Employment lawyer Lior Samfiru explains why you are still owed severance if you have been downsized on an episode of the Employment Law Show.

Before you accept any severance offer, have an experienced employment lawyer at Samfiru Tumarkin LLP review it and your employment contract.

We can tell you if what you have been provided is fair and how to get proper severance if it falls short of what you are actually owed.

If you don’t receive the full amount, which happens often, you have been wrongfully dismissed and are entitled to compensation.

In some cases, employers pressure staff into accepting poor severance packages, such as imposing a deadline for accepting the offer.

Non-unionized employees in Canada have up to two years from the date of their dismissal to pursue a claim for full severance pay.