HBC Restores Full Severance Pay After Backlash

TORONTO, May 21, 2020 — Following growing public scrutiny, Hudson’s Bay Company has reversed its controversial decision to withhold a significant amount of termination and severance pay from dozens of laid off employees, Samfiru Tumarkin LLP has learned.

On April 17, approximately 94 management and administration employees at HBC were permanently laid off, just one day after they accepted a 25% temporary pay cut as a result of the coronavirus pandemic. The notice and severance offered to employees was based on their newly reduced salaries, rather than their full earnings.

In a May 15 memo to affected employees, HBC announced that they had reversed course and will pay the 25% difference in a lump sum amount following their final termination date.

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Hudson’s Bay Company severance packages

“We are pleased to learn that HBC will in fact honour terminated employees’ full severance pay rights,” said employment lawyer Lior Samfiru, partner at Samfiru Tumarkin LLP. He shed light on the concerning tactic after reviewing the whittled-down severance offers during consultations with numerous outgoing HBC employees.

“During this challenging time, it is vital that individuals who find themselves out of work due to COVID-19 receive the compensation and financial support that they will need to bridge the gap between jobs.”

Samfiru told Global News in an interview shortly after the terminations that “HBC’s move [was] unconscionable” and that “a large organization like that cannot plead ignorance, they should know better.”

“This serves as a reminder to any non-unionized employee to have their severance offer reviewed by an employment lawyer at BEFORE they sign any documentation, to ensure that what they are being offered is fair and takes into account all of the necessary factors. Wrongful dismissals, while extremely common before the coronavirus pandemic, have become endemic in these uncertain times.”

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