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Employment Law

Dec 06
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Getting legal advice on your retirement package

By Employment Law

Retirement can approach people in different ways. Whether it is through an employee’s natural conclusion to their working days, or through a form of pseudo termination by an employer looking to pare down staff, retirement is something that everyone in Manitoba needs to consider no matter what stage of their career they are in. Many people here in Manitoba are starting to contemplate retirement and wondering if their retirement package is fair. It is important for anyone who is facing the prospect of retirement forced or otherwise, to be aware of what they are entitled to. Let’s talk about getting legal advice on your retirement package.

Ever wondered if your retirement package was fair?

When presented with any retirement package, you should review it thoroughly to make sure it includes everything that you are looking for. You may be able to negotiate a better deal. There are a number of factors which will impact what you are entitled to in any retirement factor but age will have the most significant impact on your retirement package. The more experience you have, the more valuable it will be for an employer to keep you on board as long as possible. However, if you’re nearing or already within retirement age, it could work against you if your employer wants to get rid of their obligations as soon as possible by offering a smaller pension payout and other benefits.

If this sounds like something that might happen in your future, then maybe it’s time for some financial planning now so that you can ensure your future is secure regardless of what happens at work later down the road! You could consult with an advisor who can help calculate how much tax-free income from government sources will be available during retirement (i.e., Old Age Security). You can also ask a lawyer to review any contracts regarding wages paid out during periods where no employment was provided and retirement entitlements.

Redundancy

Redundancy is when an employer claims that your position has become redundant and seeks to fundamentally change your position or terminate your employment. Traditionally these situations occur when an employer claims that there is no work which requires the employee. Your employer must follow the correct procedure to dismiss you for redundancy:

  • They must tell you that they intend to make you redundant
  • They must give you information about the redundancy process, including how many people have been selected for redundancy and what the selection criteria was. This must be done in writing and it should be sent within two weeks of making the decision to dismiss people for redundancy.
  • They must offer suitable alternative employment if there are other jobs available at the company or in similar companies and at a similar level as yours. If no suitable alternative employment is available then they will pay out statutory redundancy payments

These conditions can vary widely between different employers and employees.

Retirement Age

Some people might find themselves with no choice but to retire early simply because their employer has laid them off or their company is going through some sort of restructuring process. But others may choose an early exit from work because they want more freedom in life—or maybe they’ve found another job elsewhere and want the opportunity to build a pension/retirement plan at another job while preserving their retirement from their current employer.

Termination Agreements

Some employers may offer termination agreements to employees. A termination agreement is an agreement between an employer and employee to end their employment relationship. The purpose of a termination agreement is to negotiate a package of benefits, such as extra notice or payment in lieu of notice, severance pay, pension benefits and other entitlements under the employment contract.

These agreements are often complex and involve a combination of statutory and common law rules which can influence what an employee is entitled to.

Should you take legal advice?

If you have any questions about your contract, or if you’re not sure whether it is fair and reasonable, ask a lawyer.

You should ask a lawyer to look over your contract. This may be enough to answer some of your questions. Most termination offers will be time sensitive but should include time for the employee to consult with a lawyer. Some termination offers will even include compensation for the costs of consulting with a lawyer.

You can ask a lawyer to review the terms of your package and help you negotiate with your employer if there are things that don’t make sense or are unfair to you (for example, if there is no mention at all of termination pay).

In many cases it makes sense for employees to get their own lawyers as their employer will probably have its own legal counsel available.

If you want to make sure that your retirement package is fair and you’re not being exploited by your employer.

If you’re working and you are contemplating retirement, it’s important to know your rights. You should be able to negotiate a fair package that protects your retirement plan from exploitation by your employer.

Here are some tips on how to do this:

  • It’s important that you understand what a “fair” package is. The best way for employees to determine if their package is fair is through negotiation with their employer and speaking with an expert like a lawyere. A good place to start when negotiating salary packages is by looking at other companies in similar industries and comparing them side-by-side with yours. If there are any discrepancies between what other companies pay their employees, then it may be time for some negotiations!
  • Remember that not everything needs to be negotiated at once—you can always revisit discussions later down the line if needed (or simply revisit them every year).

Conclusion

If you are contemplating your retirement package then it’s important that you seek legal advice as soon as possible. You don’t want to be exploited or treated unfairly at this stage in life, so make sure that you are proactive and vigilant in considering your retirement.

 

Andrew MacDonald is an employment and civil litigation lawyer with Wolseley Law LLP

Aug 24
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Wrongful Dismissal 101

By Employment Law

In Manitoba a non-unionized employee can be terminated or fired at any time for any reason.  There are a few exceptions to this, but that is, for the most part, the system that we have.  One important caveat is that the employer is required to give notice of termination.

This can be done in one of two different ways.

One option is for the employer to give ‘working notice’, which means that the employee is told that their employment will terminate on a date that is far enough into the future that the employee’s legal right to notice is respected.

The other option is for the employee to be given a severance package.  This means the employee is effectively not given any prior notice of their termination, but they are provided with enough money to adequately compensate for this.

How much notice?

Whether the employee is given working notice or a severance package, the quantum of the notice period is determined by several factors.  At a bare minimum, all employees—subject to very few exceptions—must receive the notice period required by the Employment Standards Code.  An employee may also be entitled to a further amount of severance pay by the terms of their employment contract.  Most employees do not have a written employment contract, but that does not mean there is no contract.  As a matter of law certain terms can be implied.  The most important of these is the implied term that an employment contract will not be terminated by the employer without providing the employee with ‘reasonable’ notice.

Reasonable notice can be a fuzzy concept that ultimately amounts to whatever a judge would think is fair.  The age of the employee, the length of service, the availability of suitable replacement employment, and the custom in the industry can all be factors to consider.

What is a severance package?

Sometimes the compensation that is provided to an employee on their termination is called a severance package.  A severance package should be designed to adequately compensate the employee for the loss of their employment.  Although the loss of base salary in the notice period is usually the most important element, a severance package can also compensate for the loss of pension credit accrual, the loss of benefits, and can sometimes also provide access to retraining services or career counselling.

Employment Contracts

It is increasingly common for Employers to seek employment contracts from their employees that will limit severance entitlements at termination.  This can help provide certainty for employers but there are pitfalls.  Employees, and their lawyers, frequently have found ways to void termination clauses that limited severance entitlements.  When a termination clause turns out to be void, the cost for the employer is significant.  An employer should consult legal advice before seeking a termination clause in its employment contracts.  Conversely, employees who have been terminated and told that they are limited in their severance claims because of a termination clause may wish to consult legal advise as the clause may turn out to be void.

What about Cause?

In cases where an employee is guilty of serious misconduct, the law permits an employer to terminate an employee summarily and without any advance notice.  Unsurprisingly, employers and employees often disagree on whether certain facts justify summary dismissal.  Canadian courts have considered many scenarios and then ruled on whether summary dismissal was justified.  Many employers have jumped the gun and moved too quickly to dismiss when a less punishment was appropriate.

An employer considering whether to summarily terminate an employee for cause should consider obtaining legal advice prior to proceeding.

The Termination Process

Terminating an employee is a difficult and stressful moment.  Although both sides will have an interest in determining the cost of the employee’s entitlements, there is often some negotiation and back and forth.  Employees are often upset, shocked, and filled with anxiety about their future.  There are strategies in this process that can be used by both employees and employers to protect their interests in this process.  It is usually a good idea for either side to engage the services of experienced legal counsel.

How much does it cost?

Employees are often anxious about legal fees because the last time someone wants to hire a lawyer is when they have just lost their income.  Although there can sometimes be risks to negotiations, those are discussed at the outset.  In some cases, it can be possible for the lawyer to work on a contingency arrangement where the fee is taken out of the final settlement and is contingent upon the lawyer generating additional value for the client.  Legal fees can be tax deductible.

Every situation is a little bit different and it’s usually very important to not delay reaching out to legal counsel.

 

Daniel Hildebrand is a lawyer at Wolseley Law LLP focusing on civil litigation and employment law in particular

Sep 17
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Workplace Investigation: 5 Reasons to Hire an External Investigator

By Employment Law, Workplace Investigations

Fair and equitable work environments in which all employees can participate and do their best work should be the goal of all employers. As part of that goal, there is a need for accountability by both employees and employers when issues arise in the workplace. That’s where a workplace investigation may be appropriate.

Some allegations of misconduct can be investigated and addressed internally, but there are many situations where employers should consider hiring an external workplace investigator. It is valuable for employers to be aware of when they are unable to handle an investigation. There is no specific list of circumstances to determine when an external investigator should be retained because every situation is unique. Below are some factors and scenarios to consider:

  1. The Allegations Are Serious

When serious allegations, such as sexual harassment or criminal conduct, are made, it is advisable to have an investigator with the necessary legal knowledge, training and expertise handle the matter.

Also, if an employee’s job is at risk, the employer should take the necessary precautions to ensure that a fair and proper investigation is undertaken and the rights of all parties are respected. An external investigator with a background in employment law has the necessary skills to make sure this is done.

  1. Impartiality in the workplace investigation

It is vital that workplace investigations be conducted by an impartial investigator with the necessary knowledge, training and expertise. You want all parties to accept and abide by the recommendations of the investigator. A necessary part of this is for the investigator to appear neutral and unbiased. Hiring an external investigator can shield the employer from claims of bias.

  1. Lack of Time and/or Resources

Conducting a proper investigation takes significant time and resources, which otherwise would be devoted to regular workplace activities. An external investigator will be able to conduct their investigation with only minimal disruptions to the day-to-day operation of the workplace.

  1. Helps to Re-build Morale

Allegations can cause a serious rift in employee relations and workplace dynamics. Employees often feel more comfortable reporting incidents when they feel that their employer takes such allegations seriously. Hiring an external investigator is a way for employers to elevate the trust and confidence their employees have in them.

  1. Prepares for and Simplifies Litigation

Similar to avoiding the spectre of bias, hiring an external investigator can safeguard the investigation against allegations of procedural unfairness. A report by an external investigator can be used as a shield against potential litigation and can be relied on by adjudicators in human rights or employment disputes. This will save all parties time and money in the long run.

For more information, please see our workplace investigations page here.

Katie Brownell is an associate at Wolseley Law LLP where she assists businesses with workplace investigations and other human resources disputes. The information presented in this article is not to be considered legal advice nor fit for any particular purpose. You should consult a lawyer with any questions specific to your situation.
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