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Mississauga & Oakville Employment Lawyers Advising Employees on Severance Packages

When an employee is fired, they generally receive a termination letter from their former employer, outlining the terms of their departure, including severance, termination pay, notice, or pay in lieu of that notice.

If you have been terminated and have received such a letter from your employer, it may be tempting to simply sign it so that you can walk away, receive your money, and start looking for a new job. However, before you sign or agree to anything, it is advisable to consult with a knowledgeable employment lawyer to ensure you are receiving the maximum amount you are entitled to, rather than the bare minimum required by employment standards legislation.

At Bader Law, our team of highly experienced employment lawyers has been advising terminated employees about their rights for over a decade. We can review any termination letter or package you have been provided with and negotiate with your employer on your behalf to ensure you are getting the best outcome.  We work hard to protect your rights so that you can focus on moving forward and starting a new chapter in your professional life.

Differences Between Termination Pay and Severance

The letters employees receive upon termination are often referred to as “severance packages”. Although the terms “termination” and “severance” are often used interchangeably, there are fundamental differences between the two that employees should understand.

What is Termination Pay?

An employee who has been employed for at least three months is entitled to notice of their termination or pay in lieu of that notice. Termination pay, therefore, is pay that is provided to a terminated employee instead of the required notice of termination. If you receive termination pay, you will stop working right away. Your termination pay will either come in a lump sum or will be paid at the same frequency as you were paid while you were working (i.e. weekly, bi-weekly, etc.).

The amount of termination pay you are entitled to is generally outlined in your employment agreement. If it is not, the Employment Standards Act sets out minimum standards to which you are entitled:

Period of Employment Notice Required
Less than one year One week
One year or more but less than three years Two weeks
Three years or more but less than four years Three weeks
Four years or more but less than five years Four weeks
Five years or more but less than six years Five weeks
Six years or more but less than seven years Six weeks
Seven years or more but less than eight years Seven weeks
Eight years or more Eight weeks


Most employees who are fired are entitled to much more than this bare minimum threshold. The amount of notice or termination pay an employee should receive will depend on several factors, including how long they have been employed, their age, the level of responsibility they held while employed, the availability of similar employment, and other considerations.

This is something an employment lawyer can negotiate for you.

What is Severance Pay?

Not all employees are entitled to severance pay. Legally, severance pay is considered a benefit for long-term employees and is provided in recognition of their services and commitment to an organization. In order to be eligible for severance, you must have worked for your employer for at least five years. In addition, only employers who have a total annual payroll of $2.5 million or more are obligated to pay severance.

Severance pay entitlement is calculated by multiplying your regular weeks’ wages by the number of years you were employed there.

Notice Period

If you receive notice instead of termination pay, you will be expected to work for the duration of the notice period. During this time, you must continue to be paid the same wages, your employer must continue to provide health and other benefits and make contributions to any plans.

Bader Law: Protecting the Rights of Terminated Employees in Mississauga, Oakville & Throughout the Greater Toronto Area

If you have been let go, contact a knowledgeable employment lawyer as soon as possible to secure fair compensation. At Bader Law, we can counsel you on your rights, advise you on your options, and help you secure the maximum amount you are owed. Contact us online or at (289) 652-9092 to learn how we can help.