Frequently asked questions
How is termination pay calculated in Ontario?
Under the Employment Standards Act, notice or pay in lieu is 1 week after 3 months, 2 weeks after 1 year, then 1 week per completed year up to a maximum of 8 weeks. Separate statutory severance pay (1 week per year, up to 26 weeks) applies only if you have 5+ years of service and the employer's payroll is $2.5M or more, or 50+ employees are let go.
Is ESA severance the same as common-law severance?
No. The ESA figures are the legal minimum. Employees without an enforceable termination clause are often entitled to much larger common-law reasonable notice (frequently several months). For that, speak to an employment lawyer.
How much vacation pay am I owed in Canada?
In Ontario, vacation pay is 4% of gross wages, rising to 6% after 5 years. Federally regulated employees get 4% (1–5 years), 6% (5–10 years) and 8% (10+ years). Any accrued unpaid vacation pay must be paid out on termination.
Does federally regulated termination pay differ?
Yes. Under the Canada Labour Code graduated scale (from Feb 1 2024), notice or pay is 2 weeks from 3 months, 3 weeks at 3 years, then +1 week per year up to 8 weeks, plus severance of the greater of 2 days' pay per year or 5 days' pay.