Shopify Layoffs: Severance Pay for Employees

Shopify Inc. is a Canadian-based multinational tech company that operates an e-commerce platform for online businesses and retail point-of-sale systems. Founded in 2006, the digital shopping giant employs a global workforce of more than 10,000 people.

It is headquartered in Ottawa, Ontario, with physical presence in Toronto, Waterloo, Montreal and Vancouver, as well as other cities around the world. Shopify reports that nearly two million companies in 175 countries use its platform. As a result, it is among the 20 largest publicly traded Canadian companies (by market capitalization).

Shopify Layoffs: Severance pay facts

Employees at Shopify are entitled to up to 24 months of severance pay when laid off or terminated without cause, whether full-time, part-time, or hourly. Independent contractors may also qualify for severance if they have been misclassified.

Key Severance Facts

• Severance Pay: Can reach up to 24 months’ pay, based on factors like position, tenure, age, and ability to find similar work. Learn more about severance pay, and explore resources that explain how it works in Ontario, Alberta, and B.C.
• What’s Included: In addition to salary, severance may cover bonuses, commissions, and other compensation.
• Deadlines: You have up to two years from termination to pursue severance, regardless of any employer-imposed deadlines, which are not legally enforceable.
• Better Packages: We have successfully secured much larger amounts for individuals employed across a variety of positions, from entry-level jobs to executives.

Layoffs at Shopify, like any other Canadian employer, must comply with employment laws. Generally speaking, employees are entitled to severance packages if they are laid off, even during corporate restructuring or business closures.

Your rights when facing a layoff

• Notice of Termination: Your employer must provide advance notice or pay in lieu of notice.
• Severance Pay: Compensation depends on your age, position, length of service, and ability to find similar work.
• Wrongful Dismissal: If your employer doesn’t meet its obligations, you have grounds for a wrongful dismissal claim.
• Temporary Layoffs: Even a temporary pause in your work can result in a severance package through a constructive dismissal claim.

Employer tactics to watch for

In Canada, employers may employ certain strategies during layoffs to minimize their obligations:

• Pressuring Employees to Sign Quickly: Avoid signing agreements under pressure. Employer deadlines for severance acceptance are not legally binding.
• Misclassification of Roles: Many independent contractors are actually employees entitled to severance.
• Leaving Out Bonuses and Other Compensation: Ensure severance includes all entitlements, such as commissions or accrued bonuses.

How is severance pay calculated for Shopify employees?

Generally speaking, severance pay is meant to bridge the gap between jobs, offering financial stability as you transition. It’s based on several factors:

• Length of Service: Longer tenure often means higher severance.
• Age: Older employees may be entitled to more due to challenges in finding comparable work.
• Position: Senior roles or specialized positions may attract higher compensation.
• Availability of Similar Work: If your skills are in a niche market, severance may increase.
• Employment Contract: A termination clause in your employment agreement may attempt to limit your severance, but these are often unenforceable.

Many employees mistakenly believe they are only entitled to the minimum ESA amounts. In reality, you may be owed up to 24 months’ pay. Use our Severance Pay Calculator to get a quick estimate.

To learn more about how severance works in Canada, watch this quick primer featuring employment lawyer Lior Samfiru:

Shopify Layoffs: Timeline and analysis

Below is a timeline of recent job cuts at Shopify:

• May 2023: Shopify cut 20% of jobs from its global workforce and sold its logistics business to Flexport, a move that the company estimated would cost $150 million in severance.
• August 2022: Shopify reportedly laid off an 70 workers as the e-commerce giant continues to grapple with a sector-wide downturn.
• July 2022: Shopify is laying off 10% of its global workforce after the company says it misjudged the growth of e-commerce.
• August 2020: Shopify is laying off 30 to 50 operational staff around the world as the tech company swings towards a permanent remote work model.

Steps to take if you’ve been laid off

If you’ve been affected by Shopify layoffs, here’s what you need to do:

1. Don’t Sign Anything Right Away: Avoid signing severance agreements until you’ve reviewed them with an employment lawyer at Samfiru Tumarkin LLP.
2. Understand Your Entitlements: Use our Severance Pay Calculator to determine what you’re owed.
3. Speak to an Employment Lawyer: Contact us for a consultation to review your severance package.
4. Document Everything: Keep records of termination notices, severance offers, and communication with HR.

Why choose Samfiru Tumarkin LLP?

Unlike firms that rely heavily on courtroom victories, our proven strategy focuses on maximizing severance packages early in the claim process, helping clients avoid the time, cost, and stress of litigation. With extensive courtroom experience to fall back when necessary, we excel at securing generous severance outcomes quickly and efficiently for our clients.

By prioritizing resolution and client-focused strategies, we’ve successfully helped thousands of non-unionized employees navigate layoffs and terminations with confidence.

Resources for Shopify employees

• Severance for provincially regulated employees
• Severance pay by company
• Severance packages in mass layoffs

If you’re a Shopify employee facing layoffs, you don’t have to navigate this challenging time alone. Our experienced employment lawyers in Ontario, Alberta, and B.C. are ready to stand by your side, protect your rights, and secure the severance and compensation you’re owed. Beyond employment law, Samfiru Tumarkin LLP also offers expert guidance in disability claims and personal injury cases, ensuring comprehensive support for all your legal needs.

As a non-unionized employee, you deserve clear advice and effective solutions for your employment issues. Contact us today or call 1-855-821-5900 for a consultation and take the first step toward the compensation you deserve.

Disclaimer: The materials above are provided as general information about the rights of non-unionized employees in Canada. It is not specific to any one company and should not be read as suggesting any improper conduct on the part of any specific employer, or a relationship between Samfiru Tumarkin LLP and a specific employer.