In Canada, employees who have been continuously employed for at least three months or more in an establishment is statutorily entitled to be adequately well informed in time, of his or her employment termination. Only those employees on a fixed-term contract are not entitled to prior notice.
Generally, the notice period begins to count from the day an employer gives notice of the termination of contract to the employee. The only exception to these is when an employee is terminated for cause or breach of contract and is therefore not entitled to any notice or pay in lieu of notice.
Failing to provide an employee or worker with reasonable notice is considered wrongful dismissal and could make an employer liable for damages.
How is Termination Notice Paid?
The reason for providing notice to an employee or a worker is to give the employee adequate time to find comparable employment. The worker either works until the end of the termination notice period provided or stop work and is compensated with pay in place of notice equivalent to the value of salary and benefits that should have otherwise been paid until the end of the notice period.
This place the worker in the same financial position as if the worker had been allowed to continue working until the end of the notice period.
If the termination notice is provided by way of pay in lieu of, then the wages or salaries must be paid no later than seven days after the termination date or on what would have been the worker’s next regular payday, whichever is later.
What is the Minimum Notice Period?
In Ontario, the Employment Standards Act, 2000 (“ESA, 2000″) states the minimum standards for notice, termination pay, and severance. But, if the company is a federal or provincial enterprise or a federally incorporated company, legislation under the Canada Labour Code (“CLC“) takes effect regardless of where an employee physically works.
However, there are significant differences between the two with regards to minimum notice period and severance. In the case of “mass terminations” in which 50 or more employees are terminated, special rules also applies.