Slow down before you sign
When a job ends, the employer often hands over a severance offer and a release with a short deadline. It can feel like you have to sign right away. In most cases you have time to get advice, and it is worth taking it, because signing a release usually ends your right to ask for more.
What a release does
A release is a promise not to sue your employer in exchange for the severance you are being offered. Once you sign it and accept the money, it is very difficult to undo, even if you later learn you were entitled to more. Some releases also cover human rights complaints and other claims, not just severance.
Six things to check
- Is the offer more than the Employment Standards minimum? Your employer must pay the statutory minimum whether or not you sign. A release should be in exchange for something extra.
- How does it compare to reasonable notice? Under the common law, many employees are entitled to far more than the statutory minimum, depending on factors like age, length of service, type of job and the job market.
- What happens to your benefits? Check whether health, dental, life and disability coverage continue, and for how long.
- Is a bonus, commission or pension contribution missing? These can form part of what you are owed during the notice period.
- What else does the release cover? Look for confidentiality, non-disparagement, non-competition and "no rehire" terms, and for language that gives up human rights claims.
- What is the deadline? Note the date. If you need more time to get advice, it is reasonable to ask for it in writing.
Questions to ask yourself
- Was I let go while on a medical leave, after asking for accommodation, or soon after raising a concern? If so, there may be a human rights issue to consider before you sign anything.
- Do I have an employment contract with a termination clause? If so, its wording matters a great deal.
- Am I counting on references or a smooth transition? These can sometimes be negotiated as part of the package.
Negotiating
A severance offer is often a starting point. A clear, respectful request for more, explaining why, can lead to a better package without going to court. A demand letter from a lawyer setting out what you are likely owed is a common next step.
Deadlines to keep in mind
An Employment Standards complaint must generally be made within 6 months of your last day of work. A human rights complaint must be made within 1 year. A wrongful dismissal lawsuit must usually be started within 2 years.
This is general information, not legal advice. Every situation is different. If you have received a severance offer and would like it reviewed before you sign, you can book a consultation with Andrew Green Law.
This article provides general information about the law in Alberta and is not legal advice. Every situation is different. Reading this article does not create a lawyer-client relationship. For advice about your circumstances, contact Andrew Green Law.