Starting next year on February 1, 2024, federally regulated employees may be entitled to more when their employment is terminated. Industries such as air transport, banks, postal services, radio and TV broadcasting, railway and road transport, port services, First Nations band councils, or any business that is integral to the operation of one of the above fall under the Canada Labour Code (“the Code”) and must abide by federal rules and regulations. That means that if you are employed in one of these industries, and your workplace fails to keep up with these changes, you could be getting less than you’re owed.
The Current Rules [Out with the Old]
Employers must provide a minimum of two weeks’ notice in writing of termination, or two weeks’ pay in lieu of notice, to an employee who has completed at least three months of continuous employment with the employer.
This means that the infamous two weeks’ notice (which is usually false, most employees are entitled to a lot more at common law) is all that is currently “required” by the employer, and this time frame gives little notice to employees who will want to quickly bridge the employment gap and find comparable work.
Other rules apply when a group of 50 or more employees have their employment terminated together, and individual termination provisions do not apply when the employee is dismissed for just cause. The payment of severance is a separate calculation.
The New Rules as of February 1, 2024
The amendments to the Code, coming into force on February 1, 2024, were introduced in recognition that the nature of work is changing. The hope is that modern federal labour standards will better protect Canadian workers participating in the modern workforce.
Whether the changes will work to protect workers in Canada remains to be seen. Still, by knowing the new standards, federally regulated employees can help themselves by better understanding their entitlements. Knowing this can help enable employees to more readily push back and take action if they see they’re getting less than they are owed.
If this sounds like it applies to you, we encourage you to contact De Bousquet PC today. We can help you understand your entitlements and negotiate a better severance package.
When the changes take effect, employers will be required to provide individual employees with a graduated notice of termination based on the length of the employee’s continuous employment. This means that the longer you’ve worked, the more notice (or pay in lieu of notice) you are entitled to. The graduated structure brings federally regulated workers into alignment with workers regulated under provincial and territorial standards.
|Continuous Employment Period||Minimum Notice Period|
|At least 3 months||2 weeks|
|At least 3 years||3 weeks|
|At least 4 years||4 weeks|
|At least 5 years||5 weeks|
|At least 6 years||6 weeks|
|At least 7 years||7 weeks|
|At least 8+ years||8 weeks|
For up to three years of employment, the entitlement is unchanged and requires two weeks’ notice for employees who have completed at least three months of continuous employment. Once the employee has completed three years of continuous employment, the minimum notice period increases to three weeks and continues to increase by one week for each additional year of completed service up to a maximum of eight weeks.
Employers can still provide pay in lieu of notice, equivalent to the wages the employee would have earned during the notice period, or a combination of notice and pay in lieu of notice.
What else is new?
The new provisions will also establish a requirement for employers to provide a statement of benefits to employees whose employment is terminated. This statement must outline an employee’s rights, as of the date of the statement, to:
- Vacation benefits;
- Severance pay; and
- Any other benefits and pay arising from their employment.
This statement of benefits helps to clarify exactly what you are owed upon termination by a federally regulated employer. If something in this statement doesn’t match up with what you know to be owed to you, or if the employer fails to provide a statement of benefits altogether, you need to take action. An omission of this statement can easily mean that you are entitled to more than what they’re willing to show you. If your statement was omitted, or you have concerns regarding your termination, the lawyers at De Bousquet PC can help. Call us today and ensure that you are getting your full entitlement.
These amendments do not affect eligible employees’ entitlement to severance pay under section 235 of the Code. In addition to notice of termination or pay in lieu of notice, an employee who has completed twelve consecutive months of continuous employment, is entitled to the greater of:
- Two days’ wages for each completed year of employment; and
- Five days’ wages.
What does this mean?
Employment agreements that do not meet the newly set minimum requirements have a higher risk of being found unenforceable. In these situations, an employer may be required to provide an employee with reasonable notice at common law, which can be much greater than the notice required by the Code. Even if your employment contract was drafted before the new changes take effect in February 2024, the new rules still apply to you. Except that older contracts are at a higher risk of being found unenforceable, and you could be getting much more than what’s on the table. At De Bousquet PC, we are here to help you figure that out. Call us now.