Human Resources: Benefits - Am I entitled to Severance
I Quit! (Am I Entitled to a Package?)
By Brenda Hollingsworth,
Auger Hollingsworth (Ottawa, Ontario)
We all snickered when David Dingwall quit his job as CEO of the Canadian Mint and then demanded a hefty severance package. His explanation? He was "entitled to his entitlements."
What about you? If you quit your non-unionized job, what are your entitlements? Generally speaking, if you quit, you are entitled only to the pay that you have already earned.
Most provinces require the employer to pay for a period of notice when the employer terminates the position. The theory behind "notice pay" is to give employees time to job hunt or to otherwise accommodate the job loss. When the employee ends the relationship, the rationale for notice pay does not apply.
However, there are situations where an employee who resigns is entitled to payment by the employer.
- Your Employer Turns Your Resignation into a Wrongful Dismissal
If you give reasonable notice that you are quitting, but your employer tells you to leave immediately and refuses to pay you during the notice period, your employer may have wrongfully dismissed you.
"Reasonable" notice depends on your province's employment legislation, your employment contract, the type of job and how long you have had the job, among other things.
- Your Employer Forces You to Resign
If your employer tells you to quit or be fired, you may also have a claim for wrongful dismissal. Low-level employees are more often successful with this argument than are sophisticated executives-- though Mr. Dingwall appears to be the exception to that rule! Your employer's position will likely be upheld if it had "just cause" to dismiss you.
- You Are Constructively Dismissed
If your employer makes a fundamental, unilateral change to your job, you may have been constructively dismissed. This can be a tricky assessment. The court will ask: what are the terms of your written or implied employment contract; were they breached by the employer's change; and were the changes so important that you are entitled to say the contract is over. Examples include changes in pay and benefits or working conditions or employer conduct that is incompatible with the job, such as abuse or harassment.
A second tricky issue in this situation is what you should do. On one hand, if you don't wish to accept the changes, you have to speak up. Silence may be treated as acceptance. On the other hand, you can be penalized for not mitigating your damages by refusing the new, altered position.
An employment lawyer in your province can help you determine whether you are entitled to payment in any of these situations.
Brenda Hollingsworth is a litigation lawyer practicing in Ottawa with Auger Hollingsworth. Brenda represents clients in employment, personal injury and business matters. For more information, contact her at 613 233-4529 or visit her website www.ottawalawfirm.ca.
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