When an employee is terminated without cause after working at the company for a long time, they would be entitled to a large severance package under common law. The general formula is one month of pay in lieu of notice for one year of service at the company. However, there is a cap on that value, which is 24 months of pay. This means that if you worked in that company for 30 years or 40 years, the maximum amount you would be entitled to would still be 24 months, as opposed to 30 or 40 months of pay.
However, the Courts did not rule out the potential for severance pay exceeding 24 months, but it has to be under “exceptional circumstances.”
In a recent Court of Appeal for Ontario decision Currie v. Nylene Canada Inc, the Court upheld the trial court’s decision to award Ms. Currie 26 months of severance. In doing so, the Court recognized a set of factors that can be qualified as “exceptional circumstances.”
In paragraph 11 of the decision, the Court summarized Ms. Currie’s employment experience:
- Ms. Currie left high school to start work (at age 18) as a twisting operator at Nylene and worked there for her entire career, ultimately rising to become the Chief Operator reporting to the Shift Leader;
- After working at Nylene for 40 years, her employment was terminated by Nylene near the end of her career, when she was 58 years old;
- Ms. Currie had very specialized skills making it very difficult for her to find alternative suitable employment. Moreover, at the time of her termination, her computer skills were limited. She made diligent efforts to attempt to gain basic computer skills and mitigate her damages but the trial judge was not convinced she would succeed in securing alternative employment;
- The work landscape had evolved significantly since Ms. Currie had entered the workforce in 1979 and, as her experience was limited to working for Nylene and its predecessors in one manufacturing environment, her skills were not easily transferable; and
- Given Ms. Currie’s age, limited education, and skill set, the termination “was equivalent to a forced retirement.”
The key finding that the Courts made was that this was a “forced retirement.” Ms. Currien has been working at the company for 40 years. She’s been making fibers in the company since 18 years old. When the plant closed down, she was essentially forced out of work. However, despite her 40 years of dutiful service, Nyelene was not willing to provide her with re-employment or sufficient pay-in-lieu of notice.
Ms. Currie likely had no other transferable skills. However, she can still be employed, since she is only 58 years old. Yet, since she is terminated by Nyelene, she has to find another position without any computer skills. In the current digital age, this limitation greatly reduces Ms. Currie’s opportunity to secure similar employment. In such circumstances, the Courts ruled that the 24-month cap on common law is not applicable in Ms. Currie’s circumstances.
If you are an individual who’s been working at a company for many many years and has been recently terminated due to the factory closing down or other reasons, you too might be entitled to a similar amount of notice as Ms. Currie.
Your employer needs to repay you for your decades of loyalty and dedication. If they don’t, contact us.
De Bousquet PC is always ready to help employees left helpless by the brutality of their employer. We will stand our ground and help you acquire the severance pay you are rightfully entitled to.