Rise of layoffs across Canada: Lior Samfiru on 640 Toronto

Interview Summary

Over the past year, many Canadians have noticed an increased rise in layoffs. Across various sectors, but especially for technology companies, financial difficulties have led to cuts. What can employees uncertain of their job security expect in the coming months? Are there legal responsibilities employers should be aware of if they are considering layoffs?

Lior Samfiru, an Ontario employment lawyer and Co-founding Partner at Samfiru Tumarkin LLP joined 640 Toronto’s John Oakley to the rise in layoffs and the impact on employee rights.

Interview Notes

• Rise in business restructuring: Samfiru noted that there have been many companies forced to restructure or cut staff in a short period. “We’ve seen a lot of stable well-known companies that are letting go a lot of people. It is unusual and is perhaps a sign of the economy,” Samfiru stated. Samfiru went on to explain that various factors have led to this, including artificial intelligence and the pandemic.
• Replacing current employees with cheaper alternatives: Some employers have restructured their workforce by hiring cheaper labour, although this is not always the case. “From a legal standpoint, that is not illegal. You are allowed to let people go and replace them with less expensive employees as long as they are paid what they are owed.”
• Severance pay for short-service employees: Many employers mistakenly assume short-service employees would not be owed significant severance pay. “In the eyes of the law, short-service employees are treated disproportionately better than longer-service employees,” Samfiru explained.
• Frequency of temporary layoffs: “In a unionized setting, employers do have the ability to lay employees off temporarily,” Samfiru stated. “The same thing does not apply to most non-unionized employees. There is no automatic right to put someone off of work for some time.” Employees who have been placed on a temporary layoff can pursue their severance entitlements.
• Options for employees if a company closes: Samfiru explained that while a company can decide to shut its operations down, a business closure does not mean former employees are not owed severance. “That company still has to meet its financial obligations. A very bad thing for employees is if that company is formerly in bankruptcy proceedings. That is the death of severance.”

Related Resources

For further insights and discussions related to employee rights, explore the following resources:

• Constructive Dismissals in Ontario
• Layoffs in Canada 2024