Is poverty an excuse to give employees less notice?

The question of whether your company’s financial circumstances effect the notice period to which a terminated employee is entitled has been answered with a resounding “no” in Ontario.

The recent decision of the Ontario Court of Appeal in Michaela v. St. Thomas of Villanova Catholic School, 2015 ONCA 801 has re-affirmed that the relevant factors in determining notice entitlement continue to be the circumstances of the terminated employee, the level of responsibility, expertise, age, education and training and opportunity for re-employment.

The court clearly enunciated in this decision that “an employer’s financial circumstances are not relevant to the determination of reasonable notice in a particular case: they justify neither a reduction in the notice period in bad times nor an increase when times are good.”

Employers are encouraged to seek a legal opinion as to an employee’s entitlement upon termination to avoid the possibility of a claim for wrongful dismissal. A member of the Lerners LLP employment law team is available to discuss this or any other employment related issue.

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