A severance package is the pay your employer provides you in place of the proper advanced warning known as notice if you have been dismissed without cause.
The amount of severance you are entitled to depends entirely on the nature of your employment contract. An employment lawyer can give you an opinion as to whether the parts of your contract that deal with termination are enforceable. If they are, you may only be entitled to what the contract provides. If they are not, you may be entitled to damages based on a period of reasonable notice of termination. How much reasonable notice you are entitled to will depend on your age, job title, years of service, and any other factors that may impact your ability to find a new job. You can use our Ontario Severance Pay Calculator to help with estimating your severance.

You may be in a situation where your employer paid you only your minimum entitlements under employment standards legislation when they dismissed you. In that case, an employment lawyer can advice you on whether they think there is a case to be made for you to receive more severance. You can also use our Ontario Severance Pay Calculator to get an estimate of what you deserve. Further, during the period for which you may be entitled to severance, you are entitled to the continuation of all forms of compensation you received in your job, including bonuses, equity, commissions, benefits, and other perks, subject to any enforceable limiting language in your contract. In most cases, it is worth it to negotiate with your employer to reach a settlement that considers all your specific needs. An employment lawyer can help you get the best package.

An employer’s initial offer is almost always less than your entitlements under common law and is almost never their best offer. Employers anticipate that most employees are unaware of their workplace rights. Therefore, it is in your best interest to get an employment lawyer’s opinion on whether your severance package is reasonable, or is there room to negotiate. You can also start by using our Ontario Severance Pay Calculator to get an estimate of whether the package you received is fair.
The general suggestion is to never sign a release without obtaining legal advice; any release you may receive may in fact have a provision that requires you to agree that you have had a reasonable opportunity to obtain legal advice. Once you sign the release, you voluntarily give up your right to take legal action against the employer for matters relating to your employment.

Severance negotiations can last anywhere from a few weeks to several months. The length of time it takes to negotiate a severance package depends on many factors, including the number of questions you as the client pose or revisions you propose, as well as how promptly the employer responds, how good their offer(s) is/are, and how willing you are to compromise.

There are various fee options and arrangements that are offered our clients that are designed to make practical sense for your situation. Those options are discussed up front, in an open and transparent discussion.

You may see a deadline for acceptance of your employer’s offer in your termination letter and worry that if you do not act prior to that deadline, that offer will be revoked. However, in most cases, our advice is to negotiate for an improvement to your package with one or more counteroffers. Thus, the deadline in your termination letter will be meaningless if you do not intend to accept the offer that is currently on the table, as your counteroffer will constitute a rejection of your employer’s offer. Fortunately, it is extremely rare for employers to revoke their offers and backtrack, as that would invite you to sue them, which is precisely what their offer is trying to discourage.