By Armina Birdi (Articled Student)
Recently, the federal government announced amendments to the Canada Labour Code (the “Code”) which will come into effect February 01, 2024. These amendments will increase the minimum notice of termination required for individual terminations under section 230 of the Code.
Currently, section 230 (1) of the Code states that employers must provide a minimum of two weeks’ notice of termination, or two weeks’ pay in lieu of notice, to an employee who has completed at least three months of continuous employment with the employer. However, beginning February 01, 2024 federal employers will be required to provide employees with a graduated notice of termination based on the length of an employee’s continuous employment, as follows:
- Two weeks’ notice for employees with at least three consecutive months of continuous service (unchanged);
- Three weeks’ notice for employees with at least three consecutive years of continuous service;
- Four weeks’ notice for employees with at least four consecutive years of continuous service;
- Five weeks’ notice for employees with at least five consecutive years of continuous service;
- Six weeks’ notice for employees with at least six consecutive years of continuous service;
- Seven weeks’ notice for employees with at least seven consecutive years of continuous service; and
- Eight weeks’ notice for employees with at least eight consecutive years of continuous service.
The amendments will also require employers to provide a written statement of benefits to employees who have been terminated. This statement must outline: an employee’s right to vacation benefits, wages, severance pay and any other benefits and pay arising from their employment. While this requirement currently exists for group terminations, it will now apply to individual terminations.
An employer’s obligation to pay severance pay under section 235 of the Code remain unchanged. In addition to the notice of termination or pay in lieu set out above, employees who have completed twelve consecutive months of continuous employment are also entitled to the greater of two days’ wages for each completed year of employment, and five days’ wages.
Employers should consider updating employment documentation such as employment contracts, collective agreements and termination policies to reflect these amendments.
Further information can be found here.