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What employees terminated in a mass layoff should look for as compensation

Guelph Employment Lawyer Peter McSherry says terminated employees may be surprised by what they’re entitled to

Over the past six months, tech giants such as Meta, Amazon, Twitter, Google, and Microsoft have shed tens of thousands of employees. Meta’s chief executive, Mark Zuckerberg has declared that 2023 will be the “year of efficiency” at the company which has translated into two mass layoffs, with more to come.

What does this mean for employees in Ontario who are caught up in a mass layoff?

Peter McSherry, an employment lawyer in Guelph says, “Under the Employment Standards Act, there are mass termination provisions. Sometimes for short-service workers, it’s possible that the mass termination provision may give them more money than they can expect under a common law notice period.”

What are the mass termination provisions?

In Ontario, if you have lost your job, you do have workplace rights which include the right to notice. Staff in mass layoff circumstances may not be aware of these entitlements.

  • If 50 to 199 employees are terminated without cause, they must be given a minimum of 8 weeks notice.
  • If 200 to 499 employees are terminated, the minimum notice is 12 weeks.
  • If 500 or more employees lose their jobs, they are entitled to at least 16 weeks notice.

McSherry points out, “If a company is conducting a mass termination, newer employees would be receiving more under mass termination provisions than under common law notice provisions. When you see these larger layoffs, certainly the employment standard minimums go up, but just because you get more money, it doesn’t mean that’s all you’re entitled to.”

These minimum provisions are notice pay, some longer-term employees may qualify for severance and common law entitlements on top of that.

Employer obligations in a mass layoff

Courts in Ontario have decided that terminated employees who are facing a downturn in the economy, could be owed more severance due to their personal circumstances.

Typically, severance pay is based on an employee’s age, their position, and years of service. In some cases, the sector or business that employed the worker can also factor in when deciding on future employment possibilities.

McSherry says, “The entire point of wrongful dismissal is to provide a reasonable notice period to help employees adjust to termination, which at the most is two years for the longest-serving employees.” The courts are also helping people adjust to the loss of their livelihoods.

Mass tech layoffs may accelerate

With the explosion in remote work capabilities the expectation is that layoffs especially in tech will continue. McSherry says, “I think that what we’re probably going to see is that if you’re able to work from home and rarely if even go into an office, then chances are somebody else can do your job from another country with a lower wage rate.”

McSherry expects to see more mass terminations given that at the start of the pandemic tech firms were ramping up hiring because there was incredible pressure for companies to move their operations online. “It stands to reason that it took a lot of resources to create the online tools, but it probably doesn’t require the same number of workers to maintain those tools once they’re operational.”

Speak to a lawyer before accepting any offer

Employees may mistakenly assume that the first severance pay offer is sufficient. But terminated employees should not readily agree to sign an initial offer without speaking to a lawyer first. McSherry says, “I think terminated employees should always get an offer looked at by an employment lawyer to ensure that they are not entitled to more.”

A lawyer can readily identify what the employee is entitled to under the terms of their employment contract and what the law says they’re entitled to. McSherry says, “Even though the offer may look good, a lawyer should review the offer before the employee signs off and accepts it.”

If you’ve been terminated, it’s important to get the opinion of a lawyer to ensure that your employment rights are protected. Peter McSherry would be happy to speak with you to confirm that you are receiving everything to which you are entitled.

Contact Peter McSherry at (519) 821-5465, Email: [email protected] or visit