Getting fired from your job is one of life’s more stressful experiences. It can be an emotional time filled with many questions. In this post, we answer: “What am I entitled to during the termination notice period?”
In Alberta, the Employment Standards Code is the legislation governing employee termination including the pay you’re entitled to during your termination notice period.
What is Termination Pay & Severance Pay in Alberta?
Termination pay and severance pay in Alberta are two different things. We’ll describe each one separately.
Termination Pay
Termination pay is the minimum legal amount an employer must pay an employee when terminating that employee without cause. In Alberta, employers must either give you reasonable notice of your termination or pay in lieu (the amount you would earn if you were still employed for your notice period).
The length of the reasonable notice period is determined by several factors including how long you’ve been working for your employer. The minimum notice period in Alberta is 1 week but can be up to 8 weeks for qualifying employees.
If you qualify for 2 weeks termination notice, for example, your employer must either:
- give you those 2 weeks’ notice of termination (so you have some time to find alternative employment), or
- pay you what you would earn during those 2 weeks (without requiring you to come into work during your termination notice period).
However, there are times when you are entitled to receive more than the minimum amount required by Alberta law.
For more information about termination including termination notice periods, see Employment Termination & Wrongful Dismissal.
Severance Pay
Severance pay, often referred to as a “severance package”, is an amount some employees may receive in addition to termination pay. It’s determined by your work contract (if applicable) and common law.
Beyond lost wages, severance can be compensation for things like:
- Commissions,
- Bonuses,
- Pension & RRSP contributions,
- Health benefits,
- Vacation pay, and
- Other stipends and fringe benefits.
Do I Qualify for Termination Pay or Severance Pay?
In Alberta, an employer who terminates an employee with “just cause” is not required to pay that employee. A “just cause” for termination typically involves things like employee misconduct or illegal activity.
If you’ve been terminated without cause, however, you are entitled to at least the minimum termination pay amount. Your employer may choose to have you work during your termination notice period. This would meet your termination pay requirements. But most employers choose to give terminated employees pay in lieu rather than having them continue working during the notice period.
Your employer must not require you to use up vacation time or banked overtime during your termination notice period unless it’s a mutual agreement with you.
There are exceptions to these basic laws (as in the case of construction workers, for example), so it is advisable that you consult a lawyer to determine if you qualify for termination pay or severance pay.
How Much Termination Pay or Severance Pay am I Entitled To?
The amount of termination pay you’re entitled to is determined by many factors including:
- The cause of your termination,
- The length of your employment,
- The position you held,
- The current market to find a new job in the same field, and
- Your salary or wage.
The minimum termination pay you’re entitled to must at least equal what you would have earned if you worked regular hours during your termination notice period. If your wages vary from one pay period to another, your regular wages for the 13 weeks preceding your termination date are averaged to determine your weekly average wage.
Your severance pay will also depend on the benefits offered by your employer.
Because severance pay is partly governed by common law, the amount you’re entitled to can be based on previous cases and judicial decisions. Each case can be determined individually and influenced by factors that can supersede your employment contract. Again, this is why consulting a lawyer about your termination is in your best interests.
When is my Employer’s Deadline to Pay Me?
The deadline for your employer to pay what you’re entitled to depends on whether or not you were given proper termination notice.
If you received reasonable notice of termination as determined by the Employment Standards Code, you must receive your termination pay within 3 days after your last day of employment. This includes all wages, overtime pay, vacation pay, general holiday pay, and termination pay.
If you did not receive reasonable notice of termination according to the Employment Standards Code, your employer is required to pay you within 10 days after the date on which your notice period would have ended.
If no termination notice or termination pay is required, your employer must pay you within 10 days after your last day of employment.
Get What You Deserve When You’ve Been Terminated
If your employment has been terminated, you may be legally entitled to more than the minimum required by Alberta law. Do not sign a severance package or termination pay release until you have it reviewed by an employment lawyer at Osuji & Smith Lawyers!
Once you sign those papers, you may no longer go to court to fight for what you’re entitled to.
Protect yourself and know your rights. The employment lawyers at Osuji & Smith Lawyers can review your termination case and any contracts or release documents your employers want you to sign. Let us help you get everything you’re entitled to.
