Its been said that life isnt so much in holding a good hand, as
playing a poor hand well. And
while you may be out of a job, dont let difficult circumstances
prevent you from negotiating maximum fair severance package from your
After youve been fired and decide not to accept your employers
typically deficient first offer, professional battle plan is critical to
maximizing your fair severance compensation package. Accordingly, the streetwise employment lawyer not only adds
essential credibility to fallback threats of wrongful dismissal
proceedings in court, but effective counsel will further advise you on
what to ask for, who youll talk to, and just what you'll want to achieve
before attending a productive negotiation session.
Most importantly, your lawyer will help prioritize critical
elements of your severance package as follows.
your termination pay.
The longer youve worked for your employer, the more negotiation
leverage you have. Although
many employers will initially offer 1-2 weeks pay for each year worked,
courts generally award one-month per year of service adjusted
upwards in circumstances of improper employer behaviour, higher level
job responsibilities, inducement from other employment, and advanced age
of the employee being dismissed.
Meanwhile, definitely stall for time when negotiating your package, as
it may well take you several days if not weeks to shop around for
competent legal counsel to quarterback the negotiations and/or otherwise
proceed to court as necessary. And
while many employers extend mere 7-days or less for you to accept their
often insulting first offer, rest assured that Ontario law provides you
up to two-years during which to pursue wrongful dismissal proceedings in
court should your employer still refuse to negotiate following expiry of
their completely arbitrary negotiation deadlines proposed for their
Where possible, avoid settlements whereby your termination
upon your landing replacement employment.
Rather, negotiate for a lump sum or other arrangement whereby
youre not penalized with full clawback of termination pay for having
effectively mitigated your damages by landing a new and higher-paying
job. While employers may
prefer paying your severance package over time for increased leverage in
holding you to confidentiality and/or non-compete terms of your
settlement agreement - lump-sum payoff will be preferred by employees
looking to sooner cut ties with their former employer, not to mention
ability to invest your monies immediately and/or pay mounting bills.
Since severance pay is taxable, it may be advantageous to defer at least
some of your settlement income to the following tax year, when you may
be paying less taxes. Meanwhile,
reasonable portions of your settlement package attributed to pain &
suffering damages and/or reimbursement for legal expense may escape
significant income tax altogether.
your separation benefits.
While some employees will fight to the Supreme Court over medical,
dental, insurance, and other health benefits for their families, others
would much rather negotiate for the additional cash value of generally
useless benefits like outplacement services, career counselling, and
resume-writing consultants. In
any event, if your spouse is already receiving full-family benefits from
his/her employment, then why not offer to accept 50% cash-value of
worthless benefits in your own severance package negotiations?
Your right to continued stock-options will typically vanish upon
termination. But if you
were fired for without cause reasons of downsizing and/or
corporate restructuring - then ask for acceleration of vesting periods
required to exercise your stock-options, even at the expense of less
upfront termination pay. This way, both parties are better off, costing your employer
less money in the short run, but yourself potentially gaining much more
in the future should your former employers shares ironically take-off
as a result of the very restructuring that got you down-sized in the first
If still on relatively polite terms with your employer following
termination, ask for use of a spare office or cubicle, personal
telephone line, mail facilities, and even secretarial assistance to
assist in your job search - hunting for new employment without
prospective employers knowing youre already out of a job.
Negotiate continued use of your notebook computer and/or company car if
you have them, as you may be able to take over underlying leases at your
employers far-reduced corporate rates where applicable.
to hard-nosed employer negotiation tactics.
Hard-nosed employers will tell you theyre not inclined to pay you
more money until youve first signed their release.
Dont fall for this tactic under which youve just signed off
on all your litigation remedies, and no further leverage should the your
employer renege on his promises of increased generosity. Rather, remind this underhanded employer of their duty to pay
minimal Employment Standards Act termination plus vacation pay
irrespective of signed release, and absent which your lawyer will be
filing next-day complaint for formal Ontario Ministry of Labour
sanctions and maximum punitive damages claim against your employer
believing itself beyond ethics of fair negotiation.
Overall then, employees are always better off seeking professional
legal advice from lawyers well-versed in the workings of severance
package negotiations - while letting your employer know that youre
not alone in your negotiations, that you know your rights, and that you
have a team of litigation-loving lawyers just begging you to sue should
maximum fair severance not be immediately forthcoming your way.