New updates regarding Canadian termination entitlements are going into effect soon. Employers and HR professionals—continue reading to find out what this means for you.
An Overview of the New Requirements
Starting on February 1st, the Canada Labour Code will require federally regulated employers to follow revised termination notice periods and provide dismissed employees with a written statement of benefits.
For an employee who has worked at your company for at least three years, you must:
- Provide them with written notice equivalent to at least one week for every completed year of employment, up to eight weeks maximum of notice; and
- Pay the employee their regular wages in lieu of notice.
- Note: A combination of notice and wages in lieu of notice will be allowed.
Additionally, at the time of termination, you must provide employees with a statement of benefits that outlines their wages, vacation pay, severance pay, and any other benefits and pay occurring from their employment.
What This Means for Employers
What does this mean for you as a federally regulated employer or HR professional?
- Review your employment agreements to confirm that your termination entitlements follow these changes in the Canada Labour Code.
- Ensure that you have systems established to provide terminated employees with a statement of benefits within the required timeframe.