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IS THE EMPLOYER’S SEVERANCE REASONABLE?

Determining Reasonable Notice of Termination

In Alberta, an employer must give an employee reasonable notice when terminating the employment of an employee. Reasonable notice is meant to provide the terminated employee enough time to find new employment without experiencing undue financial hardship. When determining the amount of reasonable notice an employer is required to give when terminating an employee without cause, most turn to the Employment Standards Code (the “Code”). In the Code, there is a set of guidelines that outline the amount of minimum notice that an employer is required to give. Based on the length of employment until termination, the general guidelines are as follows:

General guidelines

  • 0-3 months: no notice
  • 3 months-2 years: 1 week notice
  • 2 years-4 years: 2 weeks’ notice
  • 4 years-6 years: 4 weeks’ notice
  • 6 years-8 years: 5 weeks’ notice
  • 8 years-10 years: 6 weeks’ notice
  • 10 + years: 8 weeks’ notice

The Code also allows for an employer to give an employee termination pay instead of notice. In this case, an employer is required to pay an employee an amount of, at least, equal to the wages the employee would have earned in the applicable termination notice period. 

Bardal v The Globe and Mail Ltd.

Despite the above guidelines outlined in the Code, employees are often entitled to more significant notice periods under the common law if their employment agreement does not prevent them from doing so. While the Code looks at the length of employment, the common law considers other factors when determining the notice period an employee is entitled to. The reason for more considerable notice periods is due to an essential Canadian case, Bardal v The Globe and Mail Ltd, which has set a precedent for determining termination notice periods in other employment cases.

In this case, the plaintiff was terminated without notice after 17 years of service with The Globe and Mail Ltd. In this case, the individual had been promoted throughout his career. Further, at the time of his termination, the employee held the position of Director of Advertising and was a member of the organization’s Board of Directors. The plaintiff pursued legal action against the defendant, and the court was prompted to think about the period of reasonable notice and the length of time that would be considered reasonable in different situations. The court asked, “[w]hat would be reasonable notice in all the circumstances and proper compensation for the loss the plaintiff has suffered because of the breach of the implied term in the contract to give him reasonable notice of its termination.” 

In asking this question, the court ultimately decided that there can be no definitive criteria for determining the length of reasonable notice an employee is entitled to. Instead, the reasonable notice period must be assessed on a case by case basis. The judge then went on to lay out four different factors that should be considered when evaluating the length of the reasonable notice period for each case. These factors have come to be known as the Bardal Factors. 

The Bardal Factors

 The four Bardal Factors the courts in Bardal v The Globe and Mail Ltd. outlined are:

  1. the character of the employment;
  2. the length of employment;
  3. the age of the employee; and
  4. the availability of similar employment considering the employee’s experience, training and qualifications. 

The factors allow for elements outside of the length of employment to be considered when determining the reasonable notice period. The factors take into consideration different aspects of an employee’s person and employment that may affect their ability to find new employment similar to that of their previous job. For example, an employee that is 64 may struggle to find new employment considering their proximity to retirement. Or a person in a specialized position such as a senior director may struggle to find a similar position, whereas an entry-level position may be easier to find. These are just some examples of situations in which employees may be entitled to more significant notice periods under the common law. However, as previously outlined in Bardal v. The Globe and Mail Ltd., each case must be evaluated on a case-by-case basis; each case is very unique, and many different factors can go into extending the length of a reasonable notice period. Thus, it is crucial to seek out an experienced employment lawyer to help you determine your next course of action.

Conclusion

 In Alberta, employers maintain the right to terminate an employee at any point. However, if an employer is terminating an employee without cause, the employer must provide a reasonable amount of notice or pay in lieu of. The amount of notice that an employer is required to give an employee being terminated must be reasonable in length. When determining a reasonable notice period, most people turn to the guidelines listed in the Code. However, if you have been terminated without cause and have only been offered what is outlined in the Code, you may be entitled to a higher notice award if your employment agreement does not prevent you from doing so. Depending on how the Bardal Factors apply to your case, you could receive more significant compensation for your termination. If you believe you may be entitled to a longer reasonable notice period, contact Osuji & Smith lawyers to assist you in determining your next steps. 

Need More Support?

Losing your job can be a very stressful and trying time. If you or any of your family members need support in coping with your dismissal, the Calgary Counselling Centre may be able to help. 

  • Calgary Counselling Centre

If you have recently been terminated and require financial support, you may qualify for assistance with basic living expenses and some benefits through Alberta Works.

  • Alberta Works 

Written by: Jillian Cowan and Marie Beaupre-Olsen

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