Employment Law

How much severance is a short-service employee owed?

A woman, eyes closed and with a pained look on her face, palms her forehead as she exists an office carrying a box of her belongings. The short-service worker has just been fired, and is owed severance pay.

Severance for short-term employees

You are owed severance pay if you worked for an employer or company for a short period of time.

Not only are short-service employees owed severance, but they are generally owed disproportionately higher severance packages than longer-serving employees. It is generally accepted that short-service employees are those who have worked for an employer for three years or less. Upon termination, short-service employees should pursue their severance to enable a smooth and financially secure transition to their next job.

WATCH: Employment lawyer Lior Samfiru talks about severance pay for an employee who was fired months into their job, on a season 4 episode of the Employment Law Show.

How much severance can a short-service employee get?

Many employees mistakenly believe that they are owed one week of severance per year of service to their employer. Others believe that employees are owed one month per year of service. The truth is that short-service employees are owed much more severance than just one week or one month per year of service. The reality is that many employees are owed at least one month of severance per year of service, if not more.

How is severance pay determined for short-service workers?

When calculating severance packages for short-service employees, the courts consider how long it would reasonably take for the terminated employee to find a new job, considering the employee’s age, position, salary level, availability of similar employment, and their length of service. Often this amounts to at least several months of severance, if not more, regardless of how long the employee worked for the employer who terminated them. For example, if you worked for an employer for only one year, it is very plausible that you are eligible for three to six months’ severance, depending on the considerations described above.

This is because the law recognizes that it takes everyone at least several months to find new employment. Therefore, it is only fair that short-service employees should receive enough severance to get by while they take the necessary time to find a new job.

How much is severance in Ontario?
Calculating severance pay in Alberta
BC severance packages

Notable Victories for Short-Service Employees

The courts have recognized on numerous occasions that short-service employees are owed disproportionately larger severance packages than employees with regular or long tenures. One of Samfiru Tumarkin LLP’s own employment lawyers won a trial for a 43-year-old client who was employed as a sales associate at a company for six months. When his employer let him go without cause, he was provided only one week’s pay as compensation.

Lia successfully argued that our client had been wrongfully dismissed and was in fact owed six months’ pay, due to our client’s income level at the time and his difficulty in immediately securing new employment. If this client had chosen not to pursue his severance, he would have given up six months’ pay which he was legally entitled to receive.

Severance offers and deadlines

If your employment is terminated, and your employer gives you only days or weeks to accept their severance offer, do not succumb to this pressure tactic. You have two years from the date of your termination to pursue a legal case and obtain the proper severance you deserve.

We Produce Results

Whether you are an employee who worked for an employer for a short time or a long time, always speak to an employment lawyer at Samfiru Tumarkin LLP before accepting a severance package. Our team in Ontario, Alberta and British Columbia has helped tens of thousands of Canadians get the advice they need, and the compensation they deserve.

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