Legal Law

Can Severance Pay Be Provided For Employees on Probation?

Severance Pay Be Provided For Employees on Probation

Losing a job is always upsetting, but it can be particularly difficult if you were on probation at the time of your termination. Aside from the normal shock and stress of losing a job, you must worry about where you will find work next, how to cover your expenses in the interim, and if you will qualify for any severance pay.

Many employers use probationary periods in non-union environments as a way to evaluate employees for the position. They can only do this if the employee agreed to a probationary period in their employment contract and it is specifically written that the employer has the right to terminate for cause without notice during the probationary period. Probationary periods are also used in union environments to allow companies to fire unionized employees with less notice than they would if the company was not part of a collective agreement.

Regardless of the purpose for which an employer uses a probationary period, it is illegal for them to deny an employee severance pay when they are let go during their probationary period. The reason for this is that it is a breach of the Employment Standards Act (ESA), which provides that an employee who has been employed for three months or more is entitled to severance pay upon being laid off, even without cause.

Can Severance Pay Be Provided For Employees on Probation?

If an employer wants to avoid paying severance pay, they must offer the employee a package of other termination benefits, such as vacation leave and long-term disability coverage. The amount of the severance pay owed is calculated using the ESA’s formula, which requires the employee to have worked for at least 12 weeks. The amount of the severance payment owed is multiplied by two and then added to the employee’s regular weekly wage, if they were paid on a salary basis. If an employee was paid on a commission basis, the total amount of the severance pay is equal to three times their average monthly salary.

Another important thing to note is that when severance pay is owed, the employee is generally required to mitigate their loss by seeking and taking other employment within a reasonable amount of time after being dismissed. It is important that you set aside enough money to cover your living expenses and severance pay Ontario for the duration of the period that you are working in search of a new position.

It is also worth noting that if you were on probation at the time you were laid off, your employer may have deducted income tax from your severance pay. If you are concerned about whether or not you are receiving what is rightfully owed to you, contact Samfiru Tumarkin LLP to have your case reviewed by an experienced employment lawyer. They can help you understand your rights and ensure that your employer is complying with the law. They can also help you negotiate a better severance pay offer.

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