National Bank buying Canadian Western Bank for $5B: Employee rights

What’s happening at National Bank?

National Bank of Canada (National Bank) is expanding its geographical reach by acquiring a western rival.

In a news release on June 11, the bank said it has entered into a “definitive agreement” to purchase Canadian Western Bank (CWB) in an all-share deal that values the Edmonton-based lender at approximately $5 billion.

“This transaction is about growth and brings together two great banks with a complementary footprint in personal and commercial banking, and supports our objectives in Western Canada and across the country,” Laurent Ferreira, CEO of National Bank, said in the release.

“CWB has developed an attractive banking franchise with a reputation for exceptional service with deep customer relationships across a number of priority industries and service lines. This combination will provide customers with access to a broader range of services, expertise, and products, along with the benefits of supporting technological investment and innovation.”

National Bank expects the deal to close by the end of 2025 — pending shareholder and regulatory approvals.

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The announcement comes just months after Royal Bank of Canada (RBC) completed its acquisition of HSBC Bank Canada.

As CWB prepares to come under new management, here are a few things that non-unionized employees need to be aware of.

Who pays severance if National Bank doesn’t keep certain CWB employees?

If National Bank’s acquisition of CWB results in you losing your job, then CWB must provide you with full severance pay.

In Canada, the “seller” of the business is responsible for providing proper compensation to staff who lose their job.

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 National Bank provides 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 CWB.

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
• Rights to severance in Alberta when your employer sells the business
• Employer sold the business in B.C.? Know your rights to severance
• Sale of business in Ontario: 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 Alberta, B.C., and Ontario.

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 severance entitlements.

If your company doesn’t provide you with the correct amount, you have been wrongfully dismissed and should seek legal counsel immediately.

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

LEARN MORE
• Severance for federally regulated employees
• Rights to severance for banking sector staff
• Severance pay in a recession

Can National Bank make major changes to the jobs of CWB employees?

In Canada, non-unionized employees at CWB don’t have to accept substantial changes to their job that National Bank 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
• Job changes in Alberta: What employees need to know
• Changes to your employment in B.C.: Your rights
• Can my employer make changes to my job in Ontario?

New employment contracts for CWB staff

If you work for CWB, and you receive a new employment contract from National Bank, 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 Canada 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 Alberta, B.C., and Ontario 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.