Severance Agreement Review and Negotiations in Calgary, Alberta
March 25, 2022
Employment
If you have been offered a severance package in exchange for signing a release, we can review the agreement to determine whether it is fair and reasonable.
We will also negotiate on your behalf with your employer to ensure that you obtain all of the benefits to which you are entitled under the law or under the terms of your employment contract.
What is a Severance Agreement?
A severance agreement is a contract between an employer and a departing employee. It spells out:
- The terms of employment termination, including the reason for termination
- The date on which your employment is to end
- How much notice you are required to give or receive from your employer
- Whether there will be any compensation paid upon termination of employment and under what circumstances
- Whether there will be any other benefits, such as the continuation of medical coverage
It may also include a release, which is your promise not to file any claims against your employer as a result of your termination. You or your lawyer should not sign the release if it contains unfair or unreasonable terms.
What You Should Know About Severance Agreements?
Not only in Calgary, but across Canada, severance agreements are common. In a strict sense, your company is not required to offer you any severance pay. Most employers, on the other hand, grant either statutory or contractual notice (a few weeks’ pay per year of service) (which is usually a formula provided in the employment contracts).
An employer may be obligated to provide more than statutory or contractual severance in certain circumstances. Consider the following scenario: you’ve been fired without cause (i.e., the employer has no reason for terminating your employment). In that instance, you may be entitled to pay in lieu of notice for several months.
Most employees are entitled to receive payment in lieu of notice upon termination of employment. If an employer fails to provide the proper severance, you can sue for wrongful dismissal and be awarded damages for “reasonable notice”.
Damages are based on:
- Your age and length of service with the company;
- The availability of equivalent full-time employment in the local job market for someone of your age and particular qualifications;
- Your character, including any history of layoffs, disciplinary action, or poor performance evaluations; and
- Other extenuating circumstances
If you obtain a severance agreement, it’s critical to figure out whether you’re getting the right amount of severance under the law or under another contract. If you are being paid more than is required by law or your employment contract, this may be because your employer is afraid of being sued for unfair dismissal if you are paid less.
The following are some questions that you should ask yourself before signing a severance agreement:
- 1. Do I understand this agreement fully? If not, you should contact a severance lawyer before signing it.
- 2. Do I understand all of the compensation to be provided in connection with the termination of my employment, even if that compensation is described as “subject to deduction” or “taxable”?
- 3. Have I received all benefits to which I am entitled under the terms of my employment contract?
- 4. Do I have an ongoing need for any medical benefits after the termination of my employment, either through my employer or some other source?
- 5. Have I received all payments due to me under these circumstances?
- 6.Do I understand what I am giving up by signing this severance agreement? This includes (I) my right to sue for wrongful dismissal, (II) my right to sue for constructive dismissal (i.e., if the employer has fundamentally breached your employment contract), and (III) my rights under any other law or contract (such as an employment equity plan or collective agreement).
- 7. If I am being terminated without cause, do I understand that my employer must treat me fairly in the termination process? This includes providing sufficient notice or pay in lieu of notice, and not acting in bad faith when terminating my employment.
- 8. If I am being terminated for cause, do I understand that my employer may justify its action by showing just cause (a reason which makes it reasonable for the company to terminate employment)? If so, have I been told what the reason is and have I been given a chance to respond? Has the employer followed the proper steps and channels before terminating my employment?
- 9. Is there any claim against my employer that is not covered by the agreement? If so, what will happen to that claim if I sign this agreement?
- 10. If I am signing a full and final release of claims against my employer, do I understand this means that I cannot sue for anything arising from the termination of my employment?
As you can see, a severance agreement is not an easy document to understand. It is a legally binding agreement that mandates you to relinquish all of your rights. Before signing any such agreement, you should seek legal advice to ensure that you are receiving the necessary severance under the circumstances.
We are Calgary’s Premier Severance Lawyers.
If you are being offered a severance agreement, don’t hesitate to get in touch with one of our lawyers to ensure that you are receiving proper severance.
We will:
- 1. explain your legal rights;
- 2. advise you of what you can expect from the employer and the bargaining agent if any;
- 3. help you evaluate whether to accept a severance offer or take other steps such as filing a grievance; and
- 4. assist you in negotiations for additional severance pay
Our lawyers are available to discuss your severance package with you at any time before you sign an agreement, as well as after an agreement has been signed.
Contact us today, and we will give your case the personal attention it deserves.
For more details on Employment Laws, Click here. For any question, call us today at 403-300-LAWS or email us at info@lawsnbeyond.com.
