Permanent Layoffs in Ontario: Employee Rights & Severance
Being told your layoff is permanent can feel overwhelming. In Ontario, a permanent layoff isn’t just a pause — it’s the end of your employment. That means your employer must follow the law and provide you with the full severance pay you’re entitled to — up to 24 months’ pay in many cases.
✅ If you’ve been permanently laid off, Contact Samfiru Tumarkin LLP or use our free Severance Pay Calculator Ontario to find out what you’re really owed.
What is a Permanent Layoff in Ontario?
A permanent layoff is another way of saying termination of employment. Unlike a temporary layoff, your employer is not planning to recall you.
Key signs of a permanent layoff include:
- No recall date or timeline
- Notice that your position has been eliminated
- A termination or severance package is offered
Permanent Layoff vs. Temporary Layoff in Ontario
| Temporary Layoff | Permanent Layoff |
|---|---|
| Job is suspended but not formally ended | Employment relationship ends permanently |
| Possible recall within ESA limits | No recall rights |
| Often illegal without consent in employment contract | Employer must provide termination notice & severance |
| May lead to constructive dismissal claims | Full severance owed immediately |
ℹ️ Learn More: Temporary Layoffs in Ontario
Temporary Layoff vs. Termination: What’s the Difference?
In practice, there’s little difference. Both a permanent layoff and termination without cause in Ontario means your employment is over. The only real distinction is in language — some employers use “layoff” to soften the impact.
Under Ontario law, both require your employer to provide:
- Termination pay Ontario (ESA minimums)
- Severance pay Ontario (common law entitlements, which are often much higher)
⚠️ The exception is termination for cause. This is rare and only applies in cases of serious misconduct. If your employer claims “just cause,” they must prove it — otherwise, you are still entitled to full severance.
What Severance Am I Entitled to After a Permanent Layoff?
Severance depends on several factors:
- Your age
- Your role or position
- Your length of service
- Your ability to find new work
📌 Many employees receive far more than ESA minimums — often up to 24 months’ pay under common law.
💡 Use our FREE Ontario Severance Pay Calculator to estimate what you may be owed! If you aren’t offered the correct amount of severance, you can file a claim for wrongful dismissal.
Can Employers Choose Who Gets Laid Off?
Yes, but employers must still follow the law. If layoffs target you for reasons like age, disability, parental leave, or other protected grounds, it could be discrimination under the Human Rights Code.
You may be owed human rights damages in addition to severance.
- 🔗 Learn More: Track Layoffs in Canada
What Should I Do If I’m Permanently Laid Off?
- Don’t sign anything right away. Employers often pressure employees to accept unfair packages quickly
- Review your contract. It likely doesn’t limit your rights the way your employer suggests
- Get legal advice. An employment lawyer can confirm whether your severance offer is fair
⚠️ Once you sign, you can’t go back — even if you later discover you were owed much more.
Contact an Ontario Employment Lawyer
If you’ve been permanently laid off, you don’t have to face it alone. In many cases, a layoff is considered a termination, which means you may be entitled to severance pay of up to 24 months’ salary. Before you accept a recall or wait at home without pay, speak with an experienced employment lawyer in Ontario at Samfiru Tumarkin LLP.
🛡️ We’re Employment Law Experts!
Our employment lawyers in Toronto and Ottawa have helped thousands of employees recover the full severance pay they’re owed after being put on an illegal layoff in Ontario.
At Samfiru Tumarkin LLP, we have:
- 👥 Represented 50,000+ Canadians
- 💰 Secured millions in severance payouts
- ⚖️ Settled over 99% of cases out of court
- 📱 Free Termination Consultations — in many, but not all, cases
- ⭐ Earned 3,000+ 5-star Google reviews
- 🏆 Named on of Canada’s Best Law Firms
Call us at 1-855-821-5900 or request a consultation online.
⚠️ Unionized?
You must go through your union. By law, employment lawyers can’t represent unionized employees — only your union can.
About the Author
Lior Samfiru
Lior Samfiru is a Founding Partner at Samfiru Tumarkin LLP and the Practice Leader of the firm’s Labour & Employment Law Group. Known for his advocacy and success representing both employees and employers, Lior exclusively serves clients in Ontario, where his extensive experience has made him one of Canada’s most sought-after employment lawyers.
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