Everything To Know About Terminations

Table of Contents

Termination Meaning

Termination means one’s employment has come to an end with his or her employer, permanently. In other words, “termination” is a more professional word to say that an individual has been “fired”. Getting “terminated” sounds better than getting “fired”, so that’s why employment lawyers use the word “termination” instead of “fired”. But both the words, “termination” and “fired”, mean the same thing:

Essentially, “termination” is when an employer tells an employee that they no longer work for the employer.

Some people call a termination a downsizing or a dismissal or being let go, and that’s okay – they all mean the same thing.

Importantly, a termination does not mean a “layoff”. A “layoff” is a temporary stoppage of work where the intention is to bring the employee back in 13 weeks or less while “termination” is a permanent stoppage of work with no intention to bring the employee back.

What Does It Mean To Be Terminated?

When someone is terminated, they are being told by their employer that they will no longer work for the employer.

In some cases, people are terminated with advanced warning, and they have to continue working until some particular date at which point they will stop working permanently (i.e. working notice). In other cases, terminated people are given some amount of pay instead of advanced warning (i.e. termination pay or severance). In rare cases, people are terminated summarily with no working notice of termination pay (i.e. just cause). We will discuss working notice, termination pay and just cause below.

Is Terminated The Same As Fired?

Yes, “terminated” is the same as “fired”. The word termination is simply a more polite, professional way of saying “fired”.

What Are The Types Of Termination?

There are two types of terminations: (1) terminations “without cause” and (2) terminations “with cause”.

Termination Without Cause:

In Canada, if an employer terminates an employee without cause, it means they don’t have to provide a reason, but they do have to provide “notice” of termination. Notice of termination is the advance warning an employer has to give an employee when they are terminating them.

Termination With Cause

In rare cases, employers do not have to give notice if they have “just cause” to terminate an employee.

What is just cause? Just cause is severe misconduct, neglect or incompetence on the part of an employee.

What Is Notice of Termination?

Notice is the advance warning an employer has to give an employee when they are terminating them without cause.

The amount of notice an employee must give an employee is called the notice period. The notice period is determined based on an employee’s contract, which may state that notice upon termination is calculated (1) based on minimum standards, or (2) the common law or (3) some other formula in the employment contract.

Employers can and usually do give “pay in lieu of notice” (i.e. termination pay or severance) instead of providing “working notice”.

What Is Working Notice?

Working notice is when an employer makes the employee work the notice period instead of just paying them a lump sum payment in lieu of them coming in to work the notice period.

What Is Pay In Lieu of Notice?

Pay in lieu of notice is when the employer pays the employee an amount of money that is equivalent to the money they would have earned had they worked the working notice period. Pay in lieu of notice is also called “termination pay” or “severance” (generally, they mean the same thing).

Termination Pay

Termination pay in Ontario is money awarded to an employee by their employer for loss of employment over the notice period.

Mass Termination Ontario

When an employer terminates more than fifty employees at once, special rules regarding the notice period apply. In cases of mass terminations like these, the Ontario Employment Standards Act, 2000 (“ESA“) provides enhanced entitlements for terminated employees.

How Can I Overcome Job Termination?

When someone is terminated, typically they will go through the five stages of grief. However, in two days, they will start to feel better. In five years, they will call it a blessing. The fact is, human beings are resilient, and getting terminated will allow them to find something that better suits them.

Does Termination Affect Future Employment?

The fact someone was terminated does not affect their next job. There is no “record”. What’s more, an employee is not required to disclose past employment, and few potential employers will ask about past employment unless it is something already disclosed on the applicant’s resume.

Moreover, terminations are widespread. Accordingly, future employers will be understanding. Chances are, the person interviewing the applicant will have been terminated before.

Can I Get Unemployment For Involuntary Termination?

Yes, you can get unemployment insurance in case your termination was involuntary (i.e. you didn’t quit).

Unemployment insurance is money from the federal government paid to eligible employees who stop working. Unemployment Insurance provides partial income replacement when an employee is terminated without cause.

Does An Employer Need A Reason To Terminate An Employee?

No, an employer does not need a reason to terminate an employee without cause. An employer does not even need to tell an employee why they were terminated without cause. All an employer must provide is notice of termination in case of a without cause termination.

However, for terminations with cause, which are rare, employers do need a reason, and that reason must be serious such that a dismissal without notice is justified.

Jeff Dutton

Jeff is a lawyer in Toronto who works for a technology startup. Jeff is a frequent lecturer on employment law and is the author of an employment law textbook and various trade journal articles. Jeff is interested in Canadian business, technology and law, and this blog is his platform to share his views and tips in those areas.