RBC buying HSBC Canada for $13.5B: Employee rights

Royal Bank of Canada (RBC) has received approval from Finance Minister Chrystia Freeland to acquire HSBC Bank Canada (HSBC Canada) for $13.5 billion in cash.

According to news outlets, including Reuters, RBC promised the federal government that it will:

• Establish a global banking hub in Vancouver and support more than 1,000 jobs
• Create approximately 440 net-new jobs in British Columbia

The deal, announced more than a year ago, has also received the green light from the country’s Competition Bureau.

“I want to thank the Department of Finance, OSFI, and the Competition Bureau for their diligent work in reviewing this important acquisition,” Dave McKay, president and CEO of RBC, said in a news release on Dec. 21.

“Not only will this keep more of Canada’s financial sector under Canadian ownership, but it will also allow more Canadians to access the global economy by combining the strength and scale of RBC with the international banking capabilities and financial products that HSBC Canada is known for.”

SEE ALSO
• RBC Layoffs: 500 jobs in capital markets division cut in Q4 2023
• Teck selling coal business to Glencore, Asian steelmakers for $8.9 billion
• Aviva Canada to acquire Optiom for $170M: Employee rights

Canada’s largest lender claims on its website that the transaction, which is still subject to customary closing conditions, is expected to be complete “by the end of March 2024.”

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

Who pays severance if RBC doesn’t keep certain HSBC Canada employees?

If the sale of HSBC Canada to RBC results in you losing your job, then HSBC Canada 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 RBC 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 HSBC Canada.

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:

• Age
• Length of service
• Position at the company
• Ability to find new work

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

Can RBC make major changes to the jobs of HSBC Canada employees?

In Canada, non-unionized employees at HSBC don’t have to accept substantial changes to their job that RBC 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 HSBC Canada staff

If you work for HSBC Canada, and you receive a new employment contract from RBC, 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 can’t legally force non-unionized workers in Canada 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.