Last week, we talked about various sources of law that people should understand so that they know where the legal entitlements come from. I said that the starting point was your employment contract. I just wanted to make a note about that.

Everyone who is employed has an employment contract whether they know it or not — even if you don’t have a piece of paper that says “contract” at the top. As a lawyer, and like most professions (doctors, lawyers, accountants, etc), I own shares in a professional corporation which employs me — even though I own the corporation, I’m also its employee. So even you self-employed people, take notice!

You and your employer might have just had a conversation or a series of conversations in which you settled on an employment agreement without writing it down. If you both agreed on how much notice you would get if you were fired, then that agreement is as good as if it was written. If you have a written employment contract, then you should get what it says. Again, remember that your employer must give you at least what’s required under the employment standards statutes.

In some cases, an employment contract will stipulate a notice. Quite frequently, these notice periods are below what is required under the provincial statutes. For example, in British Columbia, if you’ve been working for an employer for a year with an employment contract that said that you would only get one week of notice. Then if you got dismissed, you would receive less than the minimum requred by the employment standards act. The Supreme Court of Canada in a case called Machtinger ruled that you would not get the higher minimum required by the employment statutes. In fact, you would get what would be deemed to be reasonable notice. Reasonable notice is not defined anywhere in the employment standards act but is in fact defined by case law.

In the most common situation, you may have no employment contract (for example, you have no written contract and you had no discussion), then the law says that you should get “reasonable notice.” The majority of cases fall in this category. Your employment continues up until the day that your reasonable notice ends. Your employer must either keep you employed until that date or must pay out the salary and benefits to which you were entitled up to that date.

I’ve gotten some questions about how employment law works.  It’s a bit complicated.  And Lawyers often talk about “sources” of law; that is, we talk about where law comes from. For people who have just lost their jobs, the relevant law comes from three basic sources:

• statute, law that your elected representative makes;
• common law cases, law that judges make;
• contracts, ones you make with your employer or the unions make with their employers.

I’ll avoid the high school civics class discussion and just say that statutes includes those laws we often hear about like employment standards, human rights, and pensions statutes.  www.firedwithoutcause.com has a full list of those statutes with links to the websites, they’re really quite good.

In many cases, non-union employees rely on laws that judges make. This is the same kind of situation you’ll often see on popular TV shows where two people litigate a dispute; the judge makes a decision.  Judges record his or her reasons for those decisions, which make up a case.  It is those reasons that lawyers read, which make up a significant part of what lawyers rely on to advise their clients.   In the case of wrongful dismissal, cases will most commonly deal with situations when an employee believes that an employer is not given them enough notice to end their job.

All these sources of law govern your severance entitlement. Personally I think that the most relevant that most employees will look to when they first see a lawyer or the issues surrounding their employment contract. You may not know it but you do have a contract with your employer.

Your employer is bound by provincial employment standards legislation that sets a minimum amount of notice. They have to give you at least the amount this legislation entitles you to, no matter what your contract says, and even if your contract doesn’t mention notice at all. However, the Supreme Court of Canada has ruled that if the judge believes that a fair settlement is actually one that is higher than an employment standards act minimum, then a judge can award a severance package that is greater than the provincial minimum standard.  You can see why it’s important to know that statutes, cases, and contracts all are relevant when defining severance package entitlements.

In my experience, employees who have worked for an employer for under a year will often get, or settle on, the provincial statutory minimum standard.  However, after a year, I find that employees can often earn more than those minimums.  Unfortunately, it takes time to find those cases that define just how much employees should get.  This may sound a bit self-serving, but this is the reason why we created FiredWithoutCause.com.