Just Lost your Job? These are your Basic Rights Under the Employment Standards Act

Losing your job is always a stressful experience. However, knowing your rights and next steps in these situations can help minimize that stress.

Ontario’s Employment Standards Act, or ESA, sets out the minimum rights for most non-unionized employees in the province (if you are a unionized employee, you should contact your union rep to discuss your rights). This includes your rights when you lose your job.

Read on to learn what your employer can or cannot do when it terminates your employment.

Your employer may have to provide written notice or termination pay

In most non-unionized workplaces in Ontario, your employer can terminate your employment at any time for almost any reason, as long as they give you the required amount of written notice. This is called termination “without cause”. If your employer does not provide you with written notice, you are entitled to termination pay instead of notice.

There are situations in which you may not be entitled to notice, such as if you are temporarily laid off, if you work in an exempted industry, or if you are fired for misconduct.

Your employer can always provide you with more notice or termination pay than required by the ESA. However, they cannot provide you with less, even if you agreed to it or signed a contract.

Notice and termination pay under the ESA

The ESA has rules around how much written notice your employer must provide when terminating your employment. The amount depends on how long you worked for your employer:

Period of employment Notice period required
Less than 3 months No notice required
3 months to 1 year 1 week
1 to 3 years 2 weeks
3 to 4 years 3 weeks
4 to 5 years 4 weeks
5 to 6 years 5 weeks
6 to 7 years 6 weeks
7 to 8 years 7 weeks
8 years or more 8 weeks

If your employer terminates 50 or more employees at its establishment within a 4-week period, your notice entitlement may be different.

During the notice period, your employer cannot reduce your normal wage or pay you less than what your regular wages would be in a regular work week. If you do not work the same number of hours every week, then your weekly amount is calculated based on the average regular wages you earned in the last 12 weeks of work.

It is common for employers to terminate a person’s employment without providing written notice. In these cases, the ESA says that your employer must pay you a lump sum that is equivalent to the wages you would be entitled to during your notice period. Your employer must make this payment either seven days after termination, or on your next regular pay date, whichever is later. Your employer must pay your termination pay even if you do not sign any paperwork at your termination.

Further, if you receive benefits at work, such as health or dental benefits, your employer must continue making contributions to those benefits plans until the end of the notice period.

Severance pay

In addition to notice and termination pay, there are also certain situations in which the ESA requires employers to pay severance to an employee. In order to qualify for severance pay, you must have worked for your employer for at least five years, and your employer must either:

  • Have a global payroll of $2.5 million; or
  • Terminate the employment of 50 or more employees in a six-month period because all or part of the business permanently closed.

If you qualify for severance pay, you are entitled to one week of pay for each year of employment, up to a maximum of 26 weeks.

You may be entitled to more!

In some cases, you may be entitled to more than the minimum notice set out under the ESA. For example, your employment contract may provide for a longer notice period. You may also be entitled to “common law notice”, which can provide significantly more than your rights under the ESA. Your entitlement to common law notice depends on a number of factors and can vary depending on your circumstances. It is useful to speak to a lawyer to determine what you may be entitled to when you lose your job.

There are some reasons for which an employer cannot terminate your employment, even if they provide notice or termination pay. For example, your employer cannot terminate your employment for a reason that is discriminatory under the Ontario Human Rights Code. Your employer is also not allowed to terminate your employment as punishment for trying to enforce your employment rights. In these cases, you may be able to ask for remedies beyond termination pay, including getting your job back.

What to do if your employer doesn’t meet their obligations

If your employer terminates your employment without notice, and doesn’t provide enough termination or severance pay, you have legal remedies available:

  • File an ESA claim at the Ministry of Labour: You can file a complaint to the Ministry of Labour to claim your minimum termination pay and severance pay under the ESA. This is a cost-free and relatively fast process. You can make a claim online on the Ministry of Labour website. Your deadline to make a claim to the Ministry of Labour is 2 years after the date of your termination.
  • File a lawsuit in court: You can sue your employer in court for wrongful dismissal if they do not provide enough notice, termination pay, and/or severance. At court, your claim is not limited to the minimum rights set out in the ESA, and you can also ask for common law notice and other damages. However, court actions often take a very long time to resolve and can be costly and highly technical. Your deadline to file a lawsuit in court is generally 2 years after the date of your termination, but different timelines may apply depending on your situation.
  • You cannot file claims at both the Ministry of Labour and in court.

Termination is a complicated issue, and your entitlements and legal remedies depend on a variety of different factors. It is always best to speak to a lawyer to get legal advice about your individual situation. However, knowing your basic rights at termination can ensure that you are able to protect yourself and benefit from the legal protections provided by Ontario’s laws.

This is legal information and not legal advice. If you need further information or need legal advice, please call our Intake Line at 416-441-1764 ext. 1 or complete our online Intake Form.