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Being let go from your job can be overwhelming, and understanding your rights is crucial. Unfortunately, common misconceptions often leave employees with far less severance pay than they’re entitled to. In Ontario, these myths can cost workers thousands of dollars.
Here, we set the record straight on five common severance pay myths you need to know.
Myth 1: You’re not owed severance if you’ve been fired for cause
Termination for cause is one of the most misunderstood areas of employment law. Many employees assume they must have committed a serious offence if their employer claims they’ve been fired for cause. However, termination for cause is typically reserved for the most egregious workplace offences, such as theft or assault.
In reality, many “for cause” terminations are legally unjustified. As Lior Samfiru, employment lawyer and co-founding partner of Samfiru Tumarkin LLP, explains, “Claiming ‘just cause’ is one the most common tactics by employers to avoid paying severance. The truth is, real cause terminations are rare and require evidence of serious, deliberate misconduct, like theft or insubordination. Most of the time, employees are unfairly denied what they’re legally owed - severance.”
If you’ve been dismissed with cause, consult an employment lawyer. It’s often possible to prove the termination was without cause, entitling you to compensation.
Myth 2: Only long-term employees get severance
Another widespread myth is that severance is reserved for employees with long-standing tenure at a company. Short-term employees often assume they aren’t eligible for meaningful compensation, but Ontario law proves otherwise.
In fact, short-service employees are frequently entitled to disproportionately larger severance packages. Courts recognize that job loss affects everyone, regardless of tenure, and it can take months to secure new employment.
For example, a short-term employee recruited to a new role was dismissed after just six months. Despite being offered just one week of severance, Samfiru Tumarkin LLP successfully secured six months’ severance instead. In another case, an executive at a logistics company with just two years of service was awarded a substantial severance after Samfiru proved the employer’s offer didn’t meet legal requirements.
Myth 3: Part-time or contract workers aren’t entitled to severance
Think you’re not owed severance because you’re a part-time or contract worker? Think again. The law protects all non-unionized employees, including full-time, part-time, and many individuals classified as independent contractors.
Independent contractors are often misclassified and may actually meet the legal definition of employees. If your employer controls how, when and where you work, there’s a strong chance you’re considered an employee entitled to severance.
“The label your employer gives you doesn’t define your rights,” explains Samfiru. “Whether you’re part-time, a contractor, or full-time, what matters is the nature of your work - not the title on paper. If you’ve been let go, severance is still on the table.”
Myth 4: Severance is just one or two weeks per year of service
A common misconception, often perpetuated by employers, is that severance is limited to one or two weeks’ pay per year of service. While this is the minimum required under Ontario’s Employment Standards Act (ESA), common law entitles employees to much more - sometimes as much as 24 months’ pay.
The severance you’re owed depends on various factors, including your age, position, length of employment, and ability to find similar work. Check out Samfiru Tumarkin LLP’s Pocket Employment Lawyer to learn more about your rights when facing job loss.
“Employers want you to believe severance is capped at one, maybe two weeks per year of employment,” explains Samfiru. “The truth? Your severance could be worth up to 24 months’ pay, far beyond the ESA bare minimums.”
If you’ve been let go, try the Severance Pay Calculator to estimate what you might be owed, and contact Samfiru Tumarkin LLP to understand your options.
Myth 5: The Ministry of Labour can get you a full severance package
Relying on the Ministry of Labour to secure your severance can be a costly mistake. While the ministry can help you obtain the minimum entitlements under the ESA, it can’t enforce your full severance rights.
In fact, filing a claim with the Ministry of Labour forfeits your right to pursue additional compensation through a claim with an employment lawyer.
To ensure you receive a fair severance package, consult an employment lawyer first before calling the government for help. As Samfiru explains, “If you rely on the Ministry of Labour, you’re only getting the minimum—and that decision could cost you tens of thousands of dollars.”
Protect your rights
If you’ve been terminated, don’t let severance myths deny you the compensation you deserve. Contact Samfiru Tumarkin LLP, Canada’s largest plaintiff-side employment and disability law firm, to get expert advice and compensation. Call 1-855-821-5900, email Ask@EmploymentLawyer.ca or fill out an online contact form.
Learn more about Samfiru Tumarkin LLP’s fees, and how they work on your behalf to maximize your rights.
The firm represents non-unionized employees in Ontario, Alberta and B.C., and handles long-term disability denials in all provinces (excluding Quebec). Discover your rights by watching Lior on Ask a Lawyer every Monday and Wednesday at 9:00 p.m. on CP24.