Showing posts with label Severance. Show all posts
Showing posts with label Severance. Show all posts

Saturday 10 July 2021

Pointe Finale! Calculation of "Payroll" for Severance Purposes Not Limited to Just Ontario: Divisional Court

Section 64(1)(b) of the Ontario Employment Standards Act, 2000 requires an employer who severs an employment relationship with an employee to pay severance pay to the employee if: (a) the employee was employed by the employer for five years or more; and (b) the employer “has a payroll of $2.5 million or more.”

The question of how to calculate the employer’s payroll, specifically whether one is to consider the employer’s global payroll or only the employer’s Ontario-based payroll has (for some reason) continued to be a source of confusion.

In Hawkes v. Max Aicher (North America) Limited, 2021 ONSC 4290 (CanLII), the Ontario Divisional Court (Dambrot, Lederer and Favreau J.J.) has finally, hopefully, laid the question to rest.

Saturday 9 February 2019

OLRB Rules That When it Comes to Severance it’s Ontario-Based Operations Alone

Should the payroll of employees outside Ontario be included in the calculation of the payroll under section 64 of the Employment Standards Act, 2000?

According to a decision of the Ontario Labour Relations Board, released late in 2018, Doug Hawkes v. Max Aicher (North America) Limited, 2018 CanLII 125999 (ON LRB), it is only Ontario-based employment and operations that is captured by section 3 and therefore section 64 of the ESA.

This decision is a victory for large, multijurisdictional employers with more limited operations in Ontario.

NOTE: This decision was set aside by a decision of the Ontario Divisional Court. For my summary of that decision see Pointe Finale! Calculation of "Payroll" for Severance Purposes Not Limited to Just Ontario: Divisional Court.

Saturday 29 December 2018

Slate Not Wiped Clean by Release in Context of Share Sale

Can an employee extinguish his statutory right to severance pay by way of a full and final release signed in the context of a share sale?

According to a 2018 decision of the Court of Appeal for Ontario, Kerzner v. American Iron & Metal Company Inc., 2018 ONCA 989 (CanLII), the answer to that question is a resounding “no.”

The case has real implications for those who practice employment law in the context of the sale of a business.

Saturday 27 May 2017

Mo Money Mo Problems (A Review of Termination Pay Obligations for Large Payrolls)

On May 27, 2017, I presented a paper to the County of Carleton Law Association’s annual solicitor’s conference titled “Mo Money Mo Problems (A Review of Termination Pay Obligations for Large Payrolls).” What follows is a copy of that paper.

I can think of no better way to introduce the subject of termination pay obligations for large payrolls than the lyrical hook to the song Mo Money Mo Problems by artist The Notorious B.I.G.:

I don't know what, they want from me

It's like the more money we come across

The more problems we see

The purpose of this paper is to canvass the subject of the obligation to pay statutory severance pay. As will be explained more fully below, pursuant to the provisions of section 64 of the Ontario Employment Standards Act, 2000, it is patently obvious that, notwithstanding anything Ol’ Dirty Bastard may have said about the subject, [“Look here, more money, more problems, my ass / You'se a naive cat, if you still believe that …”] the more money that employers come across, the more problems they’ll see.

Sunday 14 May 2017

What Happens in a Buy/Sell Deal if One of the Vendor’s Employees Refuses to Accept the Purchaser’s Offer of Employment?

(c) istock/BernardaSv

A typical term of any significant asset purchase agreement, which sees the employees of the vendor continue in employment with the purchaser, is that the purchaser will make offers of employment on substantially similar terms to the vendor’s employees. As is more fully explained in my post Continuity of Employment Following the Sale of a Business, pursuant to the provisions of Part IV of the Ontario Employment Standards Act, 2000:

If an employer sells a business or a part of a business and the purchaser employs an employee of the seller, the employment of the employee shall be deemed not to have been terminated or severed for the purposes of this Act and his or her employment with the seller shall be deemed to have been employment with the purchaser for the purpose of any subsequent calculation of the employee’s length or period of employment.

But what if one (or more) of the employees (unreasonably) refuses the purchaser’s offer? Is that employee still entitled to ‘severance’ pay? The answer will surprise most employers.

Sunday 20 July 2014

Ontario Court Says When it Comes to Severance Packages 'A Deal is a Deal'

Can an employer refuse to pay out a severance package after it offers it to an employee and the employee agrees to accept it? That was essentially the question that the Ontario Superior Court of Justice was asked to resolve in the case of Dennis v. Ontario Lottery and Gaming Corporation, 2014 ONSC 3882 (CanLII).

According to the Honourable Justice Brian P. O’Marra, a deal is a deal.

Sunday 15 June 2014

The Requirement to Pay Severance in Ontario - The Decision in Paquette c. Quadraspec Inc., 2014 ONCS 2431

In a decision that will be sure to have ripple effects beyond Ontario’s borders, an Ontario Superior Court judge has ruled that for the purposes of calculating an employer’s payroll, in order to determine whether an employee is entitled to statutory severance pursuant to section 64 of the Ontario Employment Standards Act, 2000, one looks at the employer’s entire payroll, not just that of its employees in Ontario.

The case is important because under a previous line of cases, the most recent of which being Altman v. Steve’s Music, 2011 ONSC 1480 (CanLII), the court had held that it was only the employer’s payroll in Ontario that was to be considered.

For employers with operations both inside and outside of Ontario, what the case means is that even if your operations in Ontario are modest, if the company’s total payroll exceeds the statutory limits of $2.5 million dollars, employees working in Ontario may now be entitled to statutory severance pay. This decision has the potential to increase an employer’s contingent liability with respect to severance obligations by a factor of more than three!

Saturday 14 June 2014

Pardon my French: The Decision in Paquette c. Quadraspec Inc., 2014 ONCS 2431

The reasons for decision in the recently released case of Paquette c. Quadraspec Inc., 2014 ONCS 2431 (CanLII) are a necessary read for any Ontario employment lawyer.

In his reasons for decision, the Honourable Justice Paul Kane of the Ontario Superior Court of Justice sitting in Ottawa, challenges recent decisions from the Ontario courts on the issues of both contractual termination provisions and statutory severance.

The only catch? The decision is en français.

Sunday 8 June 2014

Wrongful Dismissal First Principles Affirmed by ONCA

How much weight are judges to give other wrongful dismissal decisions? According to a recent decision from the Court of Appeal for Ontario, while other decisions from the same level of court can be persuasive, they are not binding. The principle of stare decisis requires that courts render decisions that are consistent with the previous decisions of higher courts.

Saturday 15 March 2014

Not All Employees are Entitled to Severance Pay

A common misconception among both employers and employees is that anyone who is fired from his or her job in Ontario is entitled to severance pay; that simply is not the case. However, saying that a dismissed employee is not necessarily entitled to “severance” pay does not mean that the employee is not entitled to anything. What employees are entitled to varies.