Fired? Dismissed? Laid off? Does it matter? Yes, it does.
There are many ways in which an employment contract may come to an end.
In Ontario, the Employment Standards Act, 2000 (“ESA”) sets out that an employee is considered terminated if the employer
- Dismisses an employee or stops employing the employee
- Constructively dismisses an employee and the employee thereafter resigns, within a reasonable time
- Lays an employee off for a period longer than a temporary layoff.[i]
Is it Wrongful Dismissal?
The employer may terminate the employment either with cause or without cause.
A dismissal with cause should set out the misconduct, willful neglect of duty or wrongdoing of the employee that gives rise to the dismissal. In this case, there is no requirement of the employer to pay the employee beyond their last day of paid employment.
If the ‘cause’ is not such to justify being dismissed, the employee may have a claim for wrongful dismissal.
A dismissal without cause may be for reasons unrelated to the specific employee or related to misconduct and no reason need be given. In this case, the ESA provides the employee with termination pay. In addition to the ESA minimum termination pay requirements, common law sets out factors that may provide employees with more than the ESA amount. The factors to consider includes the nature of the employment, the employee’s age, duration of employment and the availability of other work with consideration given to the employee’s education, training and experience.[ii] The employer must also continue the employee’s benefits during the notice period.
If the employer fails to give proper notice in accordance with the ESA and common law, the employee may have a claim for wrongful dismissal.
Is it a Constructive Dismissal?
An employee may be considered constructively dismissed if the employer makes a significant change to the condition of the employment without the employee’s consent.
Examples include: reduction in hours, reduction in pay, change in position, harassment causing the employee to be unable to continue working, to name a few.
In these cases, an employee would resign within a reasonable period of time following the change to the condition of employment for the ESA to apply.
Is it a Layoff?
An employer may only lay-off an employee if the employment contract as between the employer and the employee provides that the employer has the right to lay-off the employee or in cases where there is an industry standard for lay-offs .
There are two types of layoffs – temporary and permanent.
A temporary layoff is used to define when an employer advises the employee reduces the employee’s hours or eliminates the position but on a temporary basis. The employment contract must provide for temporary layoffs to occur. A temporary layoff must not last longer than 13 weeks otherwise the employment may be considered terminated and the employee would be entitled to termination pay.
A permanent lay off akin to a dismissal of employment without cause and notice must be given.
If you have been recently terminated or have questions regarding your rights, please contact Lamont Law for a free consultation.
[ii] Bardal v. Globe & Mail Ltd. (1960), 24 D.L.R. (2d) 140 (Ont. H.C.), at p. 145
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