There is a widespread, financially devastating myth in the Ontario workforce: many people believe that severance pay is a perk reserved exclusively for salaried employees, managers, and executives.
This is completely false. In Ontario, hourly employees have the exact same employment rights as salaried workers. If you are a non-unionized hourly worker and you have been fired, laid off, or let go without cause, you are legally entitled to a severance package.
Unfortunately, employers often rely on this misconception. They frequently terminate hourly staff and offer them nothing—or perhaps just a few days of wages—hoping the employee will quietly walk away. Before you accept that you are out of a job with no financial cushion, you need to understand your true legal rights.
If your employer does offer you a small severance package, they will likely demand that you sign a “Full and Final Release.” Once you sign this document, you permanently forfeit your right to pursue the full compensation you are actually owed. Have an Ontario employment lawyer at Samfiru Tumarkin LLP review it first.
On This Page:
- 1. Do Hourly Employees Get Severance Pay?
- 2. How is Severance Calculated?
- 3. What if Hourly Schedule Always Changes?
- 4. Fired “For Cause”
- 5. Secure Your Exit Strategy
Are Hourly Employees Entitled to Severance Pay?
Yes. Whether you work in retail, manufacturing, construction, administration, or the service industry, if you are paid by the hour and are not part of a union, you are entitled to severance pay if your employment is terminated without cause in Ontario.
This applies regardless of whether you are classified as a full-time or part-time hourly employee. Your entitlement is not based on how your paycheck is structured; it is based on the fact that you are an employee who has lost their livelihood.
How is Severance Calculated for Hourly Workers?
Just like salaried employees, hourly workers are subject to the “Three Layers” of severance pay in Ontario.
1. The ESA Minimums
The Ontario Employment Standards Act (ESA) sets the bare minimum an employer must pay you when they fire you.
- Termination Pay: Up to 8 weeks of pay, depending on your years of service.
- Statutory Severance Pay: Up to 26 weeks of pay, but only if you have worked there for 5+ years and the company has a payroll of over $2.5 million.
2. Common Law Severance (Your True Entitlement)
The ESA only provides the statutory minimums. Unless you signed a perfectly drafted employment contract that limits your rights, you are entitled to Common Law Severance.
Under common law, courts do not use a strict formula. Instead, they apply the Bardal factors, which evaluate your age, length of service, and the type of position you hold. Because common law is designed to give you enough time to find a comparable new job, payouts are drastically higher than the ESA. Hourly employees frequently receive months of full pay under common law, with maximums reaching up to 24 months.
What if My Hourly Schedule Changes Every Week?
One of the biggest questions hourly workers have is: “If my schedule fluctuates, how do you know what a ‘week’ of severance pay is worth?”
Employers frequently make “mistakes” here, calculating an hourly worker’s severance based on a slow week to save themselves money.
The 12-Week Averaging Rule
Under the ESA, if your hours vary from week to week, your termination pay is calculated by looking at the 12 weeks immediately preceding your termination. Your employer must average the hours you worked over those 12 weeks to determine your regular weekly wage.
The Common Law Approach
When our lawyers pursue your full common law entitlements, we look at the bigger picture. If the last 12 weeks were abnormally slow, but you consistently worked full-time hours for the three years prior, we will use your T4s, past paystubs, and historical averages to prove your true earning capacity.
Termination “For Cause” and Hourly Workers
Because hourly workers often work in high-turnover industries (like retail, hospitality, or warehousing), employers frequently try to fire them “for cause” to avoid paying severance altogether.
A termination “with cause” in Ontario means the employer is alleging you committed serious misconduct, such as severe theft, violence, or extreme insubordination.
However, employers routinely misapply “cause” to minor infractions—such as being late for a shift, making a minor mistake on the floor, or not getting along with a manager. They do this hoping you won’t fight back. In Ontario, true “just cause” is extremely difficult for an employer to prove in court. If you were an hourly employee fired for cause over a minor issue, you have likely been wrongfully dismissed. You are still legally entitled to your full severance package.
Secure Your Financial Future Today
Do not let your employer tell you that hourly workers do not get severance pay. If you have been fired, laid off, or had your shifts permanently cut to zero, the employment lawyers at Samfiru Tumarkin LLP are here to protect you.
As Canada’s largest and most positively reviewed employee-side employment law firm, we have the experience and the leverage to turn minimum ESA offers into maximum common law payouts. We handle the negotiations completely on your behalf, so you can focus on finding your next job.
Over 99% of our employment cases are resolved quickly and successfully without ever going to court.
Contact Samfiru Tumarkin LLP Today
Time is of the essence. Let us secure the compensation you deserve.