Ok I was let go of my Job and was offered a severance package. I said no deal and I want more money a lot more or I will sue. They gave me what I wanted. Now there are two option a lump sum which I can get 75% of my package or salary and benefit up to x amount of time. If I find a job then I have to tell them and they would give me 50% of the remaining package. If they find out then I get nothing and they may even take the money back. I'm going for interview next week and I sure I can get a commission Job in my field. But it commission, I wonder if I should take the salary or lump sum. One other point my friend was lay off and they gave me a package he took another job in the same field with a different company an they found out. Need advice on what to do.
Severance package.
- Thread starter banelord
- Start date
The majority of packages are finalized without conditions of "If you gain alternative employment" options.
Take your case to a good labour lawyer. They should be able to finalize your package, have the funds paid to you in whichever way you desire (cash, rrsp, etc.) and the relationship is terminated without any further obligation.
Never extend payment terms via percentage of pay-outs or remaining on the payroll - End the relationship asap.
A good labour lawyer will cost you $300- $500/hour. Worth the cost if the package is a large sum. Keep your invoices from the lawyer to claim as a deduction against your income for the current taxation year.
Take your case to a good labour lawyer. They should be able to finalize your package, have the funds paid to you in whichever way you desire (cash, rrsp, etc.) and the relationship is terminated without any further obligation.
Never extend payment terms via percentage of pay-outs or remaining on the payroll - End the relationship asap.
A good labour lawyer will cost you $300- $500/hour. Worth the cost if the package is a large sum. Keep your invoices from the lawyer to claim as a deduction against your income for the current taxation year.
It depends on the amount of time, as for them taking the money back...dream on...they will never even bother beyond a few threatening letter which you should ignore...alternatively I will offer to change the condition to continuance - compensation earned so they can cover off your ramp up... (draw is not included make that clear)
Go see a good lawyer...and get the money written up so it goes directly to a RRSP. They can do that.
They bank on the fact that peoples pride will get them back into a job...soon - and that is why the clause about gaining employment will end benefits.
GET IT WRITTEN SO THAT IT IS DONE NOW!!! All payout to an RRSP~~
Go see Howard LEVY - downtown guy......I know how he operates....a great LABOUR LAWYER
and after a couple letters from his prestigious firm - the company will make it happen for you! NOW!!!
SPEND THE MONEY ON LEVY!~~~
They bank on the fact that peoples pride will get them back into a job...soon - and that is why the clause about gaining employment will end benefits.
GET IT WRITTEN SO THAT IT IS DONE NOW!!! All payout to an RRSP~~
Go see Howard LEVY - downtown guy......I know how he operates....a great LABOUR LAWYER
and after a couple letters from his prestigious firm - the company will make it happen for you! NOW!!!
SPEND THE MONEY ON LEVY!~~~
A labour lawyer should cost you $3k-$5k. This should be small percentage of the big payout you negotiated and well worth the peace of mind.
I find it hilarious that people here, like the OP, seem to think that complex legal questions can be answered in a nice short message buy people who for the most part have no legal training at all. Do yourself a favor and get a lawyer who specializes in or has expertise not necessarily labor law but wrongful dismissal. You fill find that a part from money and notice there may be other complex issue involving, bonuses, benefits, stock options and tax planing. There may be ways to structure th payments that may make the settlement more tax efficient for you as well.
Take the lump sum and tell them that the voices said to take half in lottery tickets and the other half in mint Aero chocolate bars.
Check out severance on google or yahoo search and you will find the answers in a general format. You will need a lawyer but its not as simple as a letter, remember your former employer has a lawyer too. Big Frank's advice is bogus about the RRSP stuff, you can check out the amounts available to go to an RRSP and unless you have been with that employer for many many years what's available is not much. What is really important is to have the severance document examined by a good lawyer. Not knowing how long you have been with the employer, your age and position and your previous income the package might be a good one or a lousy one.
The thing is it not like I had a great job in the first place. Second I know what the min the labour laws offer and their offer beats that. Thirds I wanted the max I can get without going to court, which they gave me. It just a matter of do I want the lump sum or keep on getting paid.
Don't know who your employer is but a couple of things to consider as being in favour of lump sum payout.
1) Is your old employer going to be in business through however long it would take to get your payout if you get it paid out over time?
2) If you take the lump sum, then find employment and your previous employer finds out, they have to go to the trouble of getting the money back and unless it's a huge sum, I'm thinking they would just write it off. If you are receiving payments they can just cut you off.
1) Is your old employer going to be in business through however long it would take to get your payout if you get it paid out over time?
2) If you take the lump sum, then find employment and your previous employer finds out, they have to go to the trouble of getting the money back and unless it's a huge sum, I'm thinking they would just write it off. If you are receiving payments they can just cut you off.
I can understand how an employer may want you to enter a "non-compete" agreement if you were quitting but does an employer actually have the right to withhold severance if he is firing you? Sounds really stupid to me. Get the whole amount NOW.
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lump sum vs ongoing does also depend on a couple of things
1 - how are you with finances, in my case i took an ongoing so i knew i had $$ coming into pay the bills while i took some time off and did the job search thing, (if i took the lump sum i would have spent it)
2 - how confident are you in finding a new job quickly
3 - i agree (if you think you need it) get a lawyer to review it, it sounds like you already went back and got the $$ you wanted
good luck
1 - how are you with finances, in my case i took an ongoing so i knew i had $$ coming into pay the bills while i took some time off and did the job search thing, (if i took the lump sum i would have spent it)
2 - how confident are you in finding a new job quickly
3 - i agree (if you think you need it) get a lawyer to review it, it sounds like you already went back and got the $$ you wanted
good luck
Correct. This is an area that the vast majority of people don't understand.
There is "notice of termination" or "pay-in-lieu of notice of termination" and there may be "severance."
What follows is a coles notes version that is applicable to non-unionized employees (if unionized, the collective agreement will set out the terms and conditions of terminations).
When an employer terminates an employee "for cause", the employee gets nothing (no severance, no notice of termination, no pay-in-lieu of termination). The employee's only option is to sue for wrongful dismissal. The employer must show it had "just cause" for termination. An employer might choose to offer a "package" to get someone to quit or not challenge the termination.
An employer also has the option to terminate you for any reason* at any time. You have no entitlement to a job (this surprises a lot of people). *With the exception that you can't terminate someone by descriminating against one of the prohibited grounds under the Human Rights Code (race, ancestry, place of origin, colour, ethnic origin, citizenship, creed, sex, sexual orientation, age, record of offences, marital status, same-sex partnership status, family status and handicap).
In this situation, the employer must provide you with the appropriate notice of termination or, at the employer's option, with pay-in-lieu of notice. The Employment Standards Act determines what the notice period is but generally it's 1 week per year of service up to 8 weeks. Pay-in-lieu of notice is pay for the same notice period and many employers choose that because they don't want an employee sitting around for weeks when they know they're about to be terminated (e.g., sabotage, poison the work environment, etc.).
A "layoff" is not termination. A layoff is a temporary cessation of employment with the possibility of going back to work. After a specified period of time, a layoff becomes permanent (see below). i.e., you're on layoff for a period of time and if there's no more work during that time you become terminated.
Severance is completely different than notice or pay-in-lieu of notice and is also determined by the Employment Standards Act (and common law). Severance is only applicable if certain conditions are met; the key ones being that the employer has at least 50 employees and the payroll is at least $2.5 million (i.e., severance is only applicable to larger employers). You're not being "fired" in a severance situation. You're being terminated (or your layoff is being made permanent). Severance is a payment of 1 week's pay per year of service up to (IIRC) 10 weeks. There are other factors that can bump up your severance payment (e.g., chances of you finding similar employment elsewhere, general employment conditions in the area, your role in the company, etc.). If an employer embarrasses you or otherwise treats you harshly when it terminates your employment, you can sue and may get a "Wallace bump up" that increases your severance payment. If severance is at play, you should really get yourself an employment lawyer.
So, in summary, you could be entitled to both notice period (or pay-in-lieu of notice) and severance, depending on your circumstances. You would never be entitled to just severance and not notice/pay-in-lieu of notice. An employer could offer you a package that is larger than severance or pay-in-lieu of notice (some companies have internal policies that are more generous; they can't go below what is mandated by the Employment Standards Act).
Many people use the terms layoff, termination, severance, package, firing, etc., interchangeably and there are not all the same. They have very specific meanings and any employee would be well served to learn the differences.
Also be aware the certain types of employees are not covered by the Employment Standards Act (e.g., construction workers, farm workers, tourism workers, etc.).
The Ministry of Labour website is a great resource: http://www.labour.gov.on.ca/english/es/
Even though this questions sounds simple, you should really get the advice of a lawyer who specializes in labour law before signing any offer. When I was terminated as a "reduction in the workforce" action, I took my severance package right away to someone well recommended. I had a pretty good case that I had been terminated because of my increased use of the medical benefits plan. I was a long term employee of 11 years. Besides improving the package from 19 weeks to 52, (with continuation of all medical benefits till end of severance) and getting me a lump sum payout that equaled the average of the last three years bonus that I received, he also got the clause called "mitigation of damages" removed from the severance. This means I can "double dip" as soon as I find new employment(just like out politicians with their pensions). They also had to reimburse me all my legal costs. Plus, he forced them to write me a glowing recommendation letter to take to interviews.
This was a big international firm....but they clearly did not know that our labour laws are stricter than the US, where they do the majority of their business. The Employment Standards Act states only the bare minimum that must be paid, but there is what they call "Common Law" here in Ontario, and the universally accepted amount is one month for every year of service.
This was a big international firm....but they clearly did not know that our labour laws are stricter than the US, where they do the majority of their business. The Employment Standards Act states only the bare minimum that must be paid, but there is what they call "Common Law" here in Ontario, and the universally accepted amount is one month for every year of service.
True, except I think that it is capped at 24 months. Otherwise, someone who worked for a company for 40 years would get 40 months severance, if there was no cap (think NHL cap).
