Indigo shareholders approve deal to go private: Employee rights

What’s going on at Indigo?

Indigo’s shareholders have voted in favour of a sale that will see the retailer become a private company.

The approval comes just weeks after Trilogy Retail Holdings Inc. and Trilogy Investments L.P. offered to pay $2.50 for each share that they don’t already own.

The Trilogy companies, which currently have a 56 per cent stake, are owned by Gerald Schwartz — the spouse of Indigo’s CEO Heather Reisman.

“We are pleased with the result of today’s vote and look forward to continuing our work on Indigo’s transformation strategy,” Reisman said in a statement following the vote.

“We remain deeply committed to our customers and to all our stakeholders as we work together to inspire reading and enrich the lives of booklovers across the country.”

The retailer expects the transaction to close next month and for its shares to be delisted from the Toronto Stock Exchange (TSX) shortly after.

SEE ALSO
• Indigo cuts jobs to kick off 2024, part of strategic plan
• Scholastic buying Toronto’s 9 Story Media for $186 million
• Deloitte picking up Canada Post’s Innovapost business

As Indigo prepares to come under new management and go private, here are a few things that non-unionized employees in Canada need to be aware of.

Who pays severance if I lose my job as a result of the privatization sale?

If you lose your job as a result of Indigo’s privatization sale, then the retailer must provide you with full severance pay.

In Canada, the “seller” of the business is responsible for providing proper compensation to staff who are fired or let go.

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 the Trilogy companies provide you with an employment offer, and you have a good reason for why you don’t want to accept it (i.e. different hours or pay), you might be able to get full severance pay from Indigo.

Even without a good reason you can still get severance, but it’s very likely that you will only receive your minimum entitlements.

LEARN MORE
• 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?

Severance for non-unionized employees in Canada 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:

To figure out how much you could be owed, use our firm’s free Severance Pay Calculator. It has helped millions of Canadians determine their entitlements.

If your company’s offer falls short of what our Severance Pay Calculator says you are owed, it’s possible that you have been wrongfully dismissed and should contact an experienced employment lawyer at Samfiru Tumarkin LLP immediately.

We regularly resolve wrongful dismissal claims and can help you secure proper severance.

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

Can the Trilogy companies make major changes to the jobs of Indigo staff?

In Canada, non-unionized employees at Indigo don’t have to accept substantial changes to their job that the Trilogy companies might try to enforce.

Major 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, there is a very good chance that you can treat it as a constructive dismissal.

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

If you believe that you have been constructively dismissed, don’t resign before contacting our firm.

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

New employment contracts for Indigo employees

If you work for Indigo in Canada, and you receive a new employment contract following the privatization sale, take the time to carefully review it before signing it.

In many cases, these agreements take away key protections that would otherwise be available to non-unionized employees, including:

• Eliminating past service: The new owner might attempt to reduce or eliminate 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.
• Reducing severance pay: 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.

Employers in the country can’t legally force non-unionized workers to sign a new employment contract immediately or a few days after receiving it.

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