Ensuring Digital Signature Lawfulness for Termination Letter in Canada

How to eSign a document: digital signature lawfulness for Termination Letter in Canada

welcome everyone this is armored mush stock from you counsel if you want to understand only one thing in Canadian employment law then it is the concept of reasonable notice of termination it is the single most important concept that has strong bearing on your employment relationship whether you are an employee or an employer so we'll talk about what this reasonable notice is and what does it mean to you and we'll explain it in simple terms so you can apply it in your own circumstances before we begin we'll start with our usual disclaimer that this course is not legal advice so if you have any specific questions you must contact a lawyer or a paralegal why is reasonable notice important well basically reasonable notice is important because it may translate into significant amount of money if you're an employer you may end up providing a significant amount of money to your departed employee and if you're an employee you may be entitled to a large amount of money so the relevance of reasonable notice is directly related to the money that you may get on termination two things you must keep in mind so with respect to reasonable notice if you are terminated without cause and you are entitled to common law rights on termination in that situation and those one those two can once those two conditions are fulfilled then you are entitled to common-law reasonable notice of termination and just to give you a perspective this reasonable notice could be as high as 24 months of income so if you make $100,000 income annually then sometimes if you meet the criteria you may be entitled to up to two years off your pay so that's a significant amount of money on termination when you're actually losing your job so what is this reasonable notice the the main thing you want to understand is that the term reasonable notice it's called reasonable notice commonly but the proper term is common-law reasonable notice of termination and so what is this it is a notice that an employer provides to an employee and basically tells the employee that his or her employment is going to end and so this common law notice or termination notice could be given in one of three ways so option number one is working notice employer can come to you and say hey Mary hey John your employment is going to end its going to terminate as of December 31st of this year so let's say 12 months from now and I am giving you this working notice you are required to come to work every single day as if you are an employee perform your duties we will provide you your salary and when December 31st comes that's your last day and then you go home and never come back and then you don't get any more money this is it so it's a working notice you worked the entire 12 months or whatever the duration of the reasonable notice is and then you go home and that's the end of it so there's no money at the end of it or the employer may say hey John hey Mary your employment is ending today so return your keys return your access cards and then at the end of the day you go home or you leave now and you do not come back and here is the money for 12 months off your pay or they may say well we'll continue to give you salary for 12 months until you find another job or something like that so but the determination happens immediately and then you get the money for the work for the notice period so that's option number 2 which is actually the most common option most employers do not like to retain an employee on their premises who knows that his or her employment is going to end sometime in the future because it makes it difficult for that employee to continue working knowing that he or she is going to lose his or a job in the in some time in the future and there's a date that has been announced to that person and also it's made you know jeopardize the relationship it may poison the work environment so majority of employers do not like to give working notice sometimes it works better and employers do that but mostly the employers do not give working notice that they would rather give you money in you of working notice or option number three is a combination of both so the employer can give part of working notice and part of money in lieu of notice so employer may say it happens sometimes when the when the factory is closing the plant is closing down in three months time and and your you know reasonable notice requirement is let's say 12 months the employer may say we expect you to to work for the three months or three months is the working notice and the remaining nine months will give you the money so it could be working notice it could be money in lieu of working notice or money and you have noticed or it could be a combination of working notice or money so that's what a reasonable notice says it is an information it is a notice that is provided by the employer to the employee providing that employee a specific date which will be the final date of employment of that employee so notice of termination so we talked about common law rights so you are entitled to reasonable notice if you are entitled to common law rights and we're talking about common law reasonable notice we're not talking about the statutory termination notice which is a completely different thing so what think that what important part you want to understand is that you get common law rights by default it is the common law rights are presumed what do I mean by that if you get hired with a company and let's say you don't have any written job offer a written employment contract whatsoever you somebody interviews you and says welcome we're gonna pay you X amount of dollars and this will York will be your position and can you start in such-and-such a and you say you answer yes and so that is an employment contract even though it's verbal but you have entered into it and when you have entered that employment contract then you by default have all the common law rights and that means if you are terminated in certain the specific circumstances of this course if you are terminated then you are by default entitled to common-law reasonable notice of termination but the second thing you want to keep in mind is that that common law right are the reasonable for reasonable notice of termination that presumption is rebuttable what that means is that that presumption can be displaced by a contract so if you have a written employment contract the employer can put in a clause which can change your common-law right on termination so it can it can take that away so it can remove that reasonable notice by contract and so how it's done we're gonna talk about that in the next slide so displacing common-law reasonable notice one way to do that is the contract may say your employment contract may say they may first of all it will have a specific termination clause it will say if in the in the event we let terminate your employment without cause you will be entitled to your statutory termination rights and nothing more so we are limiting your rights to statutory rights on termination and we've spoken about that in a separate lecture and maybe we'll talk about it a bit more but each province has a specific statute that deals with employment relationship termination and all of those and they have specific rights for the employees so for instance in case of Ontario we have an Employment Standards Act 2000 which has a specific clause that says that if you're employed for X amount of years you get X weeks of pay as termination pay so those statutory rights are very very minimal there's no comparison between the statutory rights and employment Standards Act and common law rights so there's a huge difference so a contract can actually take away your common law reasonable notice and say what you will get is only statutory rights and that's legal it's allowed an employer can do that so that's one way of doing that the other way is that the the contract may say you will retain your common law rights and and if the contract retains your common law rights then that's what you're entitled to or the contract may not have any clause about termination whatsoever and if there's no termination clause then the presumption is still there and so you are still entitled to common-law reasonable notice the third way that employer can do is give you something in between so more than statutory rights not common law rights right so they may say we'll give you your statutory rights plus two weeks or plus a month or something like that which may be much less than common law rights but it is at least more than your statutory rights so that could be a clause in your employment contract or in some cases which is really really rare but in some cases your contract may provide your termination rights which are actually more than common law rights I have seen this and you may have noticed this this usually happens mostly in appointments which are political appointments you you would see in newspapers that a large sort of crown corporation or semi you know crown corporation have been I've been working and and it's in the news the CEO did not perform so well and they terminated CEOs employment and then you realize that CEO got you know hundreds of thousands of dollars or sometimes millions of dollars in termination as a severance package and everybody's up in arms but the answer that you will get legal answer that you will get is unfortunately that was part of his or her contract and so there is no way that we can take that away so there are circumstances where the termination rights are negotiated much more than common law rights but it's very very very rare you won't see it as you know and and my experiences is sort of these political appointments where this kind of thing happens so these are some of the ways that contract can displays the presumption of reasonableness now I said you could get up to 24 months of pay and not everybody can get that and that's sort of an extreme example but what are the factors that you can keep in mind that decide or the courts what kind of factors courts consider in deciding what is an appropriate common law reasonable notice for a specific case there's no formula there's no one reason there are a variety of factors that the court considers and then decides what would be an appropriate common law reasonable notice for this employee who has been terminated without cause so so these factors in there's a case in which these factors are basically listed but they talk about more factors to be considered and they're called berdahl factors this is the term that is used in a case law and employment lawyers use this often every time they refer to Bardell factors those are some of the factors that court will consider in deciding reasonable notice so when you look at the cases the jurisprudence the courts have considered as many as about hundred and seventy different factors in arriving at what is an appropriate reasonable notice but there are four common most common factors that you want to keep in mind those are the essential ones that would apply to every single case so number one is age what is the age of an employee who has been terminated and the the formula here or the thought process here in courts mind is that the older the employee is the more the reasonable notice of termination should be courts believe that it will take older employees longer time to find another job as opposed to younger employees so their reasonable notice of termination on the basis of their age or age will play a role in in an increased reasonable notice second factor to keep in mind is length of service the longer the employee's service where the employer is the longer the notice period would be so if your long service employee then you will get higher notice and I have had clients who have worked for an employer employer for twenty years plus and and they may be entitled to twenty four months of pay depending upon their other factors third factor that is considered is the position and the way this works is what is your position I use are you a senior management employee or your management employee middle management lower management clerical you know technical engineering kind of person what is the kind of position you're occupying and then the principle of the court applies generally is that the higher the position of the employee the higher the notice period so if you are a CEO of a company you will probably get higher notice than if you were a much junior employee and then the fourth factor is what are the chances of finding another job for that specific employee and there's no sort of empirical evidence generally available but there are different factors considered so I'll give you an example some time ago there were significant reduction in automotive industry jobs and whatever jobs were being eliminated there were no alternative positions and so many engineers who were who had automotive industry experience for many many years had to retrain to go into another another job so that was a factor that for them chances of finding another job in Canada in the automotive industry was slim and so the court would award higher notice so those are some of the factors that court will consider so these are the factors that courts will consider in deciding what would be an appropriate reasonable notice and as I said you know it could be as high as 24 months or sometimes even a bit more so what is it that you want to carry from this course from this lecture is that when you are negotiating your employment contract you are not hired yet you are you know you are a candidate you are at a stage where where the employer is making you an offer and it's provided you with an employment contract and if you have any room to negotiate sometimes you don't sometimes you just accept you're just happy that you got a job and you just sign at the dotted line and you take the job but in in many many cases you have room to negotiate and if you do you want to make sure that your common-law termination rights are are not displaced they remain intact and I've advised many many of my clients when they have been faced with a job offer and they have successfully negotiated that position because if the employer really wants you for that position if the employer believes that you are an important addition to their team then they will value your negotiation they will value that you are going to look after some of your own interest in that employment contract and then the second part is that even if you already have an existing employment contract or you're not able to negotiate something different you want to make sure that you properly review your existing employment contract because even if it has a termination clause in many many cases that termination clause may be challenged may be shown or may be proven that it's unlawful it's improperly drafted and then that will not rebut sumption for common-law notice and you may be still entitled to it so it's a complex area in employment law which termination clause are rallied in which are not and if you talk to many employment lawyers they will give you the advice that you know over ninety percent ninety five percent of the time smart employment law counsel are able to challenge the appropriateness of a specific termination clause get it thrown out and then have their client get some reasonable notice so something that if you are unclear if you're unsure you want to talk to an employment lawyer so you understand your rights because what is at stake is a significant amount of money so those are two things that you want to keep in mind and hopefully this gives you some understanding of what is common law reasonable notice will have many more lectures if something is unclear or you want something elaborated upon by all means reach us out or write us and comments and we'll be happy to cover that in future lectures thank you for watching