© Copyright 2022 by Tim Louis & Company Barristers & Solicitors
by Tim Louis
Being terminated without cause or dismissed from your employment can be one of the most stressful experiences you have ever encountered. You may be tempted to accept whatever compensation your employer is offering you. Do not do so without first taking the advice of an experienced employment lawyer.
If you have been terminated by your employer, the first question that needs to be answered is: Were you terminated with cause or without cause?
If your employer had cause to terminate your employment, then you do not have a right to severance pay. A few of the more common reasons for termination with cause include fraud, chronic refusal to follow directions from your employer, intoxication while working, and establishing your own business in competition with your employer. I frequently act for clients who have been terminated by an employer who alleges cause. However, once I commence a lawsuit on behalf of my client, it soon becomes apparent that my client’s former employer did not have cause.
If your employer did not have cause to terminate your employment, then you are entitled to severance pay.
If you are entitled to severance pay because your employment was terminated without case, then the next question is whether the amount of your severance pay should be calculated based on statutory law or common law. Many of my clients are confused by the difference between these two types of law -which entitle an employee, terminated without cause, to very different amounts of compensation.
Statutory law is law based on a statute -in the case of employment law, the Employment Standards Act. This act entitles an employee, terminated without cause, to severance pay as follows:
Common law is law based on all Court judgments – in this case, lawsuits where an employee successfully sued their employer alleging the termination of their employment was without cause. Under common law, the amount of severance pay awarded in each case is different based on many factors such as: age of the employee, length of the employment and type of position. As a rough rule of thumb, the common law entitles an employee terminated without cause to one month’s severance pay for every year of employment.
As you can see, the amount of severance pay you are entitled to, if your employment is terminated without cause, is more under common law than it is under statutory law.
If you decide to make a claim for severance pay under the Employment Standards Act, [statutory law], you may do so without a lawyer. The British Columbia Labor Standards Branch will investigate your case to determine whether or not your employment was terminated without cause.
If they find that your employment was terminated without cause, they will issue an order directing your employer to pay you severance pay as described above. Some terminated employees will choose the option of statutory law over the common law option as it is usually quicker and does not usually require a lawyer.
If you decide to make a claim for severance pay under common law, you will almost certainly require a lawyer as this choice involves filing a lawsuit in Court. Although this option can typically take longer than filing a complaint with the Labor Standards Branch and will be more expensive as you typically require a lawyer, you may receive significantly more severance pay.
Finally, many of my clients are unaware of the fact that their entitlement to severance pay is reduced by the amount of any income they earn after their wrongful termination during the time period covered by the severance pay. In other words, if the Court awards you severance pay representing 6 months of employment, then any income you earned in the first 6 months after your wrongful termination will be deducted from the amount you would have otherwise been entitled to.
If you have any questions about your termination or about the other many areas of employment law that I practice, such as non-competition clauses, harassment, your employer contracting out of the common law, or your employment contract, give me a call on my cell 778-855-3494. I really enjoy going to bat for the proverbial underdog.
N.B. Most employees work for employers governed by Provincial law. However a relatively few types of employers, such as banks and airlines, are governed by Federal law. This blog provides information for employees who work for employers who are governed by Provincial law.
Learn more from the Employment Standards Act.
ABOUT VANCOUVER, BC BASED LAW FIRM SPECIALIZING IN LONG-TERM DISABILITY, PERSONAL INJURY, EMPLOYMENT LAW AND ESTATE LITIGATION.
At the law firm of Tim Louis and Company, we are committed to helping people through difficult times. Starting with a free consultation, we help people who need it most to get the compensation they deserve. Our practice includes Long-Term Disability, Personal Injury, Employment Law and Estate Litigation. With over four decades of experience, Tim Louis has helped people across British Columbia get legal help when they need it most.