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The law as it relates to employment contracts has evolved substantially over the course of the past few years. A termination clause in an employment contract that was enforceable two years ago is likely not enforceable today. What that means is if you want to terminate an employee the termination pay and severance pay will not be limited to the Employment Standards Act but rather the common law. To give you an example of the difference between the ESA and the common law is as follows:
Let’s use the example that you want to terminate an employee without just cause a middle manager of 55 years old who has worked for your organization for 15 years the cost to you to terminate this employee under the ESA with an enforceable termination clause in your employment contract would be 8 weeks plus benefits. If the termination clause in the employment contract is not enforceable the cost to terminate this same employee, you will likely be somewhere between 12 and 15 months’ pay in lieu of notice. That is a substantial cost between an enforceable employment contract and one that is not enforceable.
Joanne’s Question: I am 62 years old and I am a Government Employee. Recently, my Employer made it clear to me that my position was going to be eliminated soon and suggested that I retire. Can they do that? What should I do?
Thank you for your question Joanne. No, your employer CANNOT terminate or suggest that you take an early retirement because of your age. That is DISCRIMINATION based on AGE.Discrimination:
Discrimination is unequal treatment that results in disadvantage to an individual based on stereotypes rather than on their abilities or circumstances.Under the Canadian Human Rights Act discrimination is unequal treatment based on:
1. Race;
2. National or Ethnic Origin;
3. Color;
4. Religion;
5. Age;
6. Sex;
7. Sexual orientation;
8. Gender identity;
9. Marital Status;
10. Family Status;
11. Genetic characteristics;
12. Disability; and
13. Previous convictions;
Age Discrimination:
Age discrimination in the workplace occurs when an employer allows an employee’s age to impact his/her decision to promote, demote, and terminate that employee.
Similar Case Law:A. Legros v Conseil du Tresor, 2017 CarswellNat 5897
Ms. Legros worked as a Senior Policy Analyst for the Canadian Border Services Agency. In 2011-2012, the federal government required all government agencies to reduce staff and government spending.
More senior employees were offered a cash incentive based on years of service to retire early.
Ms. Legros who was 62 years old, wanted to take advantage of the cash incentive, but her Manager denied her request.
The Board found that her Manager did not approve Ms. Legros’ request because she was convinced that Ms. Legros was going to retire soon anyways.
The Manager’s decision based on Ms. Legros’ age was discriminatory. Canadian Boarder Services was ordered to pay Ms. Legros the following:
1. $15,000 for age discrimination; and
2. $10,000 for pain and suffering.Summary:
Having looked at the relevant statue and similar case law, it is our position that your employer CANNOT force you to retire before you are ready to do so. If he did force you to retire, his actions would constitute discrimination based on age, and you would likely be successful in filing a human rights complaint with the Canadian Human Rights Commission.
Suzanne Desrosiers Professional Corporation:
For assistance in updating your employment policies and procedures, providing training to staff members, and/or obtaining general employment law advice please contact Suzanne Desrosiers today at suzanne@sdlawtimmins.com or (705) 268-6492.
Experience, Integrity, Results.