By Bill Duvall
As the prognosis for Canada’s economy remains uncertain, the Canadian court system continues to churn out employment cases arising from distressed employers. On this front, two recent cases are of interest. In the first, an Ontario court concludes that employees may not be entitled to statutory severance pay when they are provided with pension bridging and supplementary benefits. In the second, a British Columbia court is more employee-friendly, giving a broad interpretation to the definition of wages.
Ontario employees not entitled to severance pay
In Ontario, employees with at least five years’ service are generally entitled to up to 26 weeks’ severance pay when their employer discontinues its business. Employers are exempt from this severance pay obligation when an employee retires on termination and receives an “actuarially unreduced pension benefit that reflects any service credits which the employee, had the employment not been severed, would have been expected to have earned in the normal course of events for purposes of the pension plan.”