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When someone is terminated from their job in Canada without cause, and they do not have an enforceable termination clause in their employment contract (or no written employment contract at all), then they are entitled to “reasonable” notice of their termination.
What is notice? Notice is how much advanced warning an employer must provide an employee before their termination. Most employers provide employees “pay in lieu” of notice instead of working notice of their dismissal. Read more about the concept of notice here.
How much notice must employers give employees? As discussed above, in case of a without cause dismissal, if an employee has an enforceable termination clause in their contract, their employer owes the amount of notice described in the termination clause. However, if there is no enforceable termination clause, then the employer must provide a “reasonable” amount of notice according to the common law.
What is a “reasonable” amount of notice?
What constitutes “reasonable” notice will vary with the circumstances of any particular case. The “reasonableness” of notice must be decided with reference to each particular case – no two cases are the same and the courts reject the so-called rule of thumb that employees should get one month’s notice for every year of service.
Rather, what is “reasonable” notice depends on the following factors:
- the character of the employee’s employment,
- the length of service of the employee,
- the age of the employee; and
- the availability of similar employment, having regard to the experience, training and qualifications of the employee.
The case of Panimondo v. Shorewood Packaging Corporation, 2009 CanLII 16744 (ON SC), describes each factor as follows:
With regard to the character of the employee’s employment, there is a presumption that employees with more senior positions, such as those with management responsibilities, require a longer notice period than those with lower levels of responsibility.
While length of service must not be given undue prominence, there is no doubt that length of service has traditionally been an important factor in determining the period of reasonable notice.
Concerning age, there is a general presumption that older employees get more notice because how it becomes progressively more difficult for an employee to obtain new employment over time. Generally, age 20-30 is in favour of lesser notice, age 30-50 is generally neutral, and age 50+ is a factor in favour of more notice.
The availability of similar employment is a question that must answer are there any circumstances that would make it easier or harder for the employee to find comparable new work? For example, long-term employment within a narrow field has the effect of leaving an employee in a less marketable position when searching for replacement employment, and these kinds of workers should be afforded more notice as a result. At the same, for example, workers terminated in a recession could be afforded more reasonable notice because of how much harder it could be to find a new job with such elevated unemployment levels across the job market.
In terms of estimating reasonable notice, reasonable notice awards are generally at a minimum of two months for short-serving junior employees and a maximum of 24 months for long-serving senior employees, barring any exceptional circumstances (Lowndes v. Summit Ford Sales Ltd., 2006 CanLII 11654 (ON CA)). Using the four factors described above, employees should be awarded notice somewhere in this range for it to be “reasonable”.
If an employee is not provided “reasonable” notice, then it is a wrongful dismissal.
See our Average Severance Package Infographic.
Conclusion: All About Reasonable Notice
In Canada, under the common law, employment contracts for an indefinite period require the employer, absent express contractual language to the contrary, to give reasonable notice of an intention to terminate the contract if the dismissal is without cause. What is “reasonable notice” thereafter depends on the:
- character of the employee’s employment,
- the length of service of the employee,
- the age of the employee; and
- the availability of similar employment, having regard to the experience, training and qualifications of the employee.
Jeff is an employment lawyer in Toronto. He is the Principal of the Dutton Employment Law Group at Monkhouse Law. Jeff is a frequent lecturer on employment law and is the author of an employment law textbook and various trade journal articles.
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