The 2025 Job Market Shake-Up: Protecting Your Rights During Layoffs in Ontario

The start of 2025 has seen a surge in layoffs across major companies, reflecting the current economic climate influenced by global factors such as the ongoing U.S. President Donald Trump's threat of tariffs, rising global inflation, and supply chain disruptions exacerbated by geopolitical conflicts.

Companies like VF Corp, Shopify, Stripe, Starbucks, BP, Microsoft, and Wayfair have recently announced significant workforce reductions, leaving many employees uncertain about their rights and next steps. This guide aims to shed light on employee rights during layoffs in Ontario and the importance of consulting with Ontario employment lawyers when navigating these challenging situations.

Recent Layoff Trends in 2025

Meta is set to announce performance-based cuts in February 2025, which are expected to impact employees in Canada, marking the latest in a string of tech industry layoffs. This news comes on the heels of a tumultuous January, which saw VF Corp announce sweeping layoffs as part of their corporate restructuring strategy, resulting in the loss of over 1,200 jobs globally. Shopify, an Ottawa-based tech giant, also continued its restructuring trend with another round of layoffs in its support division, marking the latest in a series of workforce reductions that began in 2023. Additionally, Stripe's layoffs affected around 300 employees and garnered media attention not just for the job cuts but also due to a controversial internal communication error involving a cartoon duck.

These layoffs come amid economic pressures, including the US-Canada tariff disputes, which have strained cross-border trade and impacted business operations in various sectors. This economic uncertainty has led to cost-cutting measures, including staff reductions, even in traditionally stable industries.

Understanding Your Rights During Layoffs

In Ontario, employee rights during layoffs are protected under the Employment Standards Act(ESA). Here are key points to consider:

1. Temporary Layoffs

A temporary layoff is not the same as termination. Under the ESA, a temporary layoff can last up to 13 weeks in any consecutive 20-week period, or up to 35 weeks if certain conditions are met, such as continued benefits coverage.

However, if your employment contract does not include a layoff clause, a temporary layoff could be considered constructive dismissal. In such cases, consulting with Ontario employment lawyers is crucial to understand your legal standing.

2. Severance Pay and Termination Rights

• Employees terminated without cause are typically entitled to notice of termination or pay in lieu of notice. The amount depends on factors like the length of employment, the employee's age, and the nature of the job.
• In some cases, employees may also be entitled to severance pay if they have been employed for five or more years and the employer has a payroll of at least $2.5 million.

3. Constructive Dismissal

If significant changes are made to your job without your consent—such as a drastic pay cut, demotion, or relocation—this could constitute constructive dismissal. In such scenarios, reaching out to Toronto employment lawyers can help you determine if you are entitled to compensation.

What to Do If You Are Laid Off

1. Review Your Employment Contract: Understand the terms related to layoffs, termination, and severance.
2. Consult Employment Lawyers: Ontario employment lawyers can provide clarity on your rights and help negotiate severance packages.
3. Document Everything: Keep records of all communications with your employer regarding your layoff.
4. Apply for Employment Insurance (EI): If eligible, apply for EI benefits promptly to ensure financial support during your job search.

Why Legal Advice is Crucial.

The wave of layoffs in early 2025 serves as a sobering reminder of how fragile job security can be, especially during times of economic turbulence. With rising uncertainty fueled by factors like the US-Canada tariff disputes and shifting global markets, many hardworking individuals are left facing not just the loss of a paycheck but the emotional and financial strain that comes with it.

If you find yourself in this challenging situation, know that you are not alone. Seeking guidance from Ontario employment lawyers can provide clarity and support during this challenging time. Lecker & Associates specializes in employment law and can advocate for your best interests, whether it's negotiating a better severance package or pursuing a constructive dismissal claim.

Call (416) 223-5391or schedule a confidential and no-charge initial assessment with us.