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Severance for Short Service Employees


Stuart Rudner here with another Rudner Law video employment law update.

So I’ve said this before and I will say it again: do not assume that short service employees will only get minimal or no severance at all, and do not assume that every employee has an automatic probationary period, because they don’t.

A recent case out of British Columbia confirms both of these points for us. The bottom line is that we have an employee who was in a technician role, worked a total of three days, and got three months of severance after that. In that case, the employee was 67 years old and the court found that his age was a significant factor in assessing what the reasonable period of notice should be, but I think it’s important to take two steps backward here.

First of all, as I said at the beginning, do not assume that every employee has a probation period. That will only apply if there is a clear term in their contract which not only says there is a probationary period, but also explains what that means, in the sense that they can be let go at any time without cause and without notice. Simply saying something like 90-day probationary period is not going to be enough. In this case there was no probationary period that would have changed things.

The second thing to remember is that a contract and a termination clause can dramatically change an employee’s entitlement to severance. So if there was a clause here which set out exactly how much this individual would get, and if it was enforceable, and those who check out our blog regularly know, it’s often hard to have a termination clause that is enforceable, but if you did, then the person’s age would be completely irrelevant. But if there is no enforceable termination clause, then the common law applies and every employee, including a three-day employee, is entitled to reasonable notice, and reasonable notice, contrary to the popular myth, which says it’s a month per year of service, reasonable notice takes into account a bunch of factors including, of course, length of service, but also age, and the nature of the person’s employment, and the availability of similar employment, and whether they were lured away from previous employment, among other things.

In this case, there was no inducement, but the court looked at this individual’s age and found that it was a significant enough factor, that despite the fact that he only worked for three days, he got three months of severance.

The bottom line here, if you’re an employee you need to make sure that you know what your rights are, and if you are let go after a short period of service, don’t assume that you’re only entitled to minimal or no severance at all, because like this case shows, you could have significant entitlements. And if you’re an employer and you want to protect yourself, make sure you have a strongly worded contract that will not be overturned.

Either way, we encourage everyone to contact us before making any decision, to make sure that you know what your rights are, what your obligations are, and you can make an informed decision.

That’s all for today thanks for tuning in.

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Stuart and others on the team at Rudner Law are frequent contributors to the following sites: 

First Reference Employment Law Resources
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Legal Matters Employment Law Canada

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