It well understood that in tough economic times, employers, not employees, carry the higher financial risk. They must do everything they can to ride out the tide without job layoffs. Sometimes, businesses have valid reasons for reducing payroll. And the law permits them the ability to make strategic decisions to restructure and make temporary or permanent changes to their workforce. The rules for doing so are clearly stipulated in the Employment Standards Act.
This matter, however, often gets blurry when employers strategically shift employment terms to suit only themselves and they count on employees not knowing any better. All workers must understand the legal difference between layoffs and terminations. The financial implications can vastly differ depending on which one it is.
Layoff or Termination? Legally they Differ
Mass job losses make headline news. Sometimes, very large employers undergo closures, restructuring or staff reductions. When reporting these unfortunate stories, news organizations tend to use the terms layoff and termination interchangeably. Yet in fact, there is a real and tangible legal difference between the two. Your rights and entitlements differ in both, along with your financial compensation.
The law is very specific about definitions for layoffs. With extended layoffs, you remain an employee of the business and your employer must continue your employment benefits. In addition, they must compensate you substantially for the extended layoff. All other layoffs, no matter how they are labelled, are actually terminations, entitling you to termination pay. In the most egregious circumstances, some employers skirt the law by cycling their employees through random sham layoffs. They make work schedules and income so unpredictable that employees end up quitting in frustration.
Insolvency Layoffs and Bankruptcy
If you work for a company in dire financial straits, then insolvency layoffs are a reality, as is a bankruptcy. You will want to read this article carefully, so you understand your rights. When businesses are unable to meet their financial obligations, they can turn to the courts for help. The Bankruptcy and Insolvency Act sets provisions for businesses to operate “on emergency life support” in the face of genuine insurmountable financial pressure. What are your rights and entitlements under those circumstances? Will you receive your unpaid wages, severance and vacation pay?
How We Can Help
Lecker & Associates exclusively represent employees of Ontario. For over 35 years, wrongful dismissal cases have been the cornerstone of our practice. We have handled numerous cases where employees have been permanently let go, with inadequate termination pay, under the guise of a temporary layoff. This is an area of employment law we understand particularly well.
Furthermore, our litigation experience with precedent setting cases offers us the confidence to wade into uncharted territory. We are not afraid to take on cases, at both provincial and federal levels, to bring clarity to ambiguous laws.
If you have been unfairly treated by your employer, we are fierce advocates for employee rights and can can likely help you better than anyone else.
After a long standing career with professional firms, I was terminated as a result of a purchase. I hired Bram Lecker of Lecker & Associates and the service I received was nothing short of fantastic. Mr. Lecker and his entire team were extremely attentive, responsive and very caring. The settlement that I received was extremely fair and has enabled me to search for comparable employment. I would highly recommend Mr. Lecker and his team to anyone who may find themself in a similar situation.Linda Stern
Legal Fees are the main reason why people avoid seeing a lawyer. We can likely alleviate much of that anxiety at the very first meeting. An initial review of your case is usually free. Furthermore, for the majority of cases, our fee is charged as a percentage of the settlement we obtain for you.
We take on a vested interest in seeing your case succeed.
Legal fees should never deter anyone in this situation and we invite you to learn more about our legal fees structure here.