Severance Package: Consult a Lawyer Before Accepting

Don’t Accept That Severance Package!

Every so often I run into individuals who have recently lost their job but have already accepted a severance package from their former employer. Even though such a person has little legal recourse after signing a release, I’ll often get asked to assess what their full entitlements would have been had they taken some kind of legal action. If nothing else, these people are seeking peace of mind that they made the right decision.

Unfortunately, of those people, only about a quarter actually received anything close to their full legal entitlements. For the rest, many would have been legally entitled to twice or even three times what their employer had offered. By the end of the conversation, I’m often told that they wished they had consulted with an employment lawyer in Ontario or British Columbia such as myself before they had accepted their employer’s severance offer.

Learn more about severance deadlines below with an episode of the Employment Law Show.

Why People Hesitate

It’s easy to understand why someone might not want to see a lawyer when considering accepting a severance package.

If the employee had a good relationship with their employer, they may not want to spoil it by involving a lawyer.

If someone is accused of bad performance or some type of misconduct, they may feel that they don’t deserve any compensation.

Above all, many people worry about the cost, believing that legal fees are the last thing they can afford if they’ve just lost their job.

While these are valid concerns, they should be reconciled against the need to ensure that, if fired, one is receiving all the compensation they are legally entitled to. Employers are obligated to provide employees with advanced warning that they will lose their job (working notice), or if fired without warning, to compensate employees for a period while they look for new employment (pay in lieu of notice).

Everything you need to know about severance pay below from the Employment Law Show.

Benefits of a Severance Consultation

As employees are usually terminated with little or no advance notice, in most cases, it’s not a matter of if an employee is entitled to some type of compensation, but how much. How much notice one is entitled to depends on various factors, and even in cases the employer claims to have “just cause” to terminate one’s employment (i.e. accusations of bad performance or some other alleged misconduct), an employee may nonetheless be entitled to compensation.

That’s why when one is presented with a severance package, it’s always a good idea to consult with an employment lawyer to determine what one’s legal entitlements are.

A proper consultation to review a severance package or canvass one’s legal entitlements after being terminated usually takes no more than an hour. As for cost, while an hour of a lawyer’s time is not cheap, it’s well worth it to determine if you have experienced a wrongful dismissal and are owed several more months’ salary by your former employer.

A lawyer, experienced in employment matters, can in the course of a consultation provide a fairly accurate assessment of what your full termination entitlements are, the best method to use to realize those entitlements (by extracting them from your former employer), as well as provide an estimate on the cost and time it will take to do so.

Severance Package Reviews

When I conduct such consultations and severance package reviews, I always advise my clients based on what kind of added value retaining a lawyer can bring to their situation. In some cases, launching a lawsuit right away or negotiating with the employer is the best option. Other times, the circumstances are such that the risks and costs of litigation may outweigh the benefits, and it’s worthwhile to accept the severance package being offered.

In all cases, my clients, even if they decide not to retain a lawyer, walk out of a consultation with the peace of mind of knowing what their legal entitlements are, as well as what the road ahead will look like if they decide to pursue them.

More importantly, unlike those who sign a severance package before knowing what they’re owed, my clients don’t walk out of a consultation with any regrets that they could have received several more months’ salary, if only they had come to me sooner.

Before accepting a severance package, contact one of our employment lawyers in Toronto, Vancouver employment lawyers or employment lawyers in Ottawa.

BEFORE YOU SIGN, use the Severance Pay Calculator to determine what you are owed.

Learn more about the Top Myths of Termination from the Employment Law Show.