How Much Severance Pay Are You Owed in Ontario?

Many Ontario employees accept the first severance offer they receive without knowing they may be entitled to significantly more. Understanding how severance is calculated under Ontario law is essential before signing anything.

ESA Minimums vs Common Law Entitlement

The Employment Standards Act (ESA) sets minimum standards. After 5 or more years with an employer with a payroll over $2.5 million, you're also entitled to statutory severance pay — one week's pay per year of service, up to 26 weeks.

Common law reasonable notice is almost always higher. Courts consider your age, length of service, character of employment, and availability of similar jobs. A 45-year-old manager with 10 years of service could be entitled to 10-18 months of pay.

ESA Notice Periods by Years of Service

• 3 months to 1 year: 1 week
• 1 to 3 years: 2 weeks
• 3 to 4 years: 3 weeks
• 4 to 5 years: 4 weeks
• 5 to 6 years: 5 weeks
• 6 to 7 years: 6 weeks
• 7 to 8 years: 7 weeks
• 8+ years: 8 weeks

What's Included in Severance Pay?

Severance should reflect your full compensation — not just base salary. This includes bonuses, commissions, benefits, car allowances, and pension contributions that would have continued during the notice period.

Don't Accept Too Quickly

Employers often present a take-it-or-leave-it offer with a short deadline. This is a negotiating tactic. You have time to consult a lawyer, and most employment lawyers offer free consultations for severance reviews.