Going out of business

Recent cases in Ontario and B.C. contrast what may be owed to employees when they’re sent packing
By Nikolay Chsherbinin
|Canadian Employment Law Today|Last Updated: 02/23/2011

Dismissed employees with a certain amount of service are usually entitled to statutory severance pay. For example Ontario employees with at least five years of service are entitled to one week of wages for every year of service up to 26 weeks, if their employers’ payroll is at least $2.5 million or 50 or more employees were dismissed within a six-month period due to a business closure. Severance pay compensates for loss of employees’ service credit and job-related benefits. But sometimes other factors can reduce this compensation.