Mass Layoffs in Alberta: Rights to Severance

What Is a Mass Layoff?

A mass layoff in Alberta occurs when 50 or more employees are terminated from the same workplace within a four-week period. It’s also known as a group termination.

Non-unionized employees affected by such layoffs are entitled to a full Alberta severance package, which can amount to as much as 24 months’ pay.

For mass layoffs, Alberta employers are required to provide written notice to Employment Standards at least four weeks before the scheduled termination date. Failing to comply with this requirement can result in administrative penalties under the Employment Standards Code (ESC).

LEARN MORE
• Severance packages in mass layoffs
• Layoffs in Canada

How much severance pay am I entitled to if I’m let go during a mass layoff in Alberta?

Under common law, employees and senior executives in Canada are owed full severance pay when they lose their jobs due to downsizing or corporate restructuring.

Severance in Alberta can be as much as 24 months’ pay. The amount of compensation you are owed is calculated using a number of factors, including:

• Age
• Length of service
• Position
• Ability to find new work

Our firm’s Severance Pay Calculator can help you figure out how much you are owed. If it falls short of what is appropriate, you have been wrongfully dismissed and should file a claim for compensation.

LEARN MORE
• Severance pay for provincially regulated employees
• Severance for federally regulated employees

How much working notice should I receive if I’m let go during a mass layoff in Alberta?

In Alberta, your length of service affects the minimum amount of working notice you should receive from your employer before you are let go as part of a mass layoff.

• If you have worked for the company for more than 90 days, but less than two years, you are owed one week of working notice.
• If you worked for the company for two years, but less than four years, you are owed two weeks of working notice.
• If you have worked for the company for four years, but less than six years, you are owed four weeks of working notice.
• If you have worked for the company for six years, but less than eight years, you are owed five weeks of working notice.
• If you have worked for the company for at least eight years, but less than 10 years, you are owed six weeks of working notice.
• If you have worked for the company for 10 years or more, you are owed eight weeks of working notice.

These minimum amounts do not represent the full potential for a complete severance package.

WATCH: Employment lawyer Lior Samfiru breaks down everything you need to know about working notice on an episode of the Employment Law Show.

How does working notice affect my severance pay?

While most employers prefer to provide severance pay and end their relationship with an individual immediately, some companies choose to give working notice instead.

If workers in Alberta receive working notice ahead of a mass layoff, it will reduce the amount of severance pay that they are owed after the period ends.

If my employer is struggling financially, does that affect my severance pay?

In Alberta, an employer can’t reduce your severance entitlements even if they are experiencing financial challenges.

During tough economic conditions, it’s going to be harder for you to find new employment, which means more compensation is owed.

LEARN MORE
• Severance Pay in a Recession
• Employment Insurance and Severance in Alberta

Severance packages help you bridge the gap between jobs. If the gap is expected to be longer than usual, your compensation must reflect this.

Don’t accept a severance offer until you speak with an employment lawyer

While mass layoffs can be an overwhelming affair, your employer can’t force you to accept a severance offer before you leave a meeting or by a particular date.

Offers can sometimes include:

• A termination clause that tries to limit the amount of severance pay you can receive
• Non-compete clauses that prevent you from finding work elsewhere in your industry following a mass layoff

As long as you don’t sign the offer from your company, you have two years from the date of your layoff to pursue full severance pay.

LEARN MORE
• I already accepted a severance package, what should I do?
• ‘Alberta is Calling’: What to consider before changing jobs

Changes to the ESC

Before August 14, 2020, employers in Alberta were required by the ESC to provide additional working notice to staff affected by a mass layoff.

While the legislation has been amended, if your employment contract was signed between September 1, 2019 and August 14, 2020, the provision will impact your termination.

• Example: A past client’s employment contract, which was signed in January 2020, attempted to limit his severance entitlements to the minimum amount required under the ESC. After working for the company for seven years, he would only receive six weeks’ pay. However, the termination clause didn’t take into account the possibility that a mass layoff may have occurred. As a result, we argued the clause was unenforceable and that he was entitled to full severance pay under common law.

Before accepting any offer, have an experienced Alberta employment lawyer at Samfiru Tumarkin LLP review the agreement to ensure you are receiving the compensation you are owed.