In Newfoundland and Labrador, common law severance is not strictly “one week per year of service.” Courts use the Bardal factors-your age, length of service, the importance of your role, and the local job market-to calculate fair notice, which can reach up to 24 months of total compensation.
When an employer in Newfoundland and Labrador decides to terminate an employee without cause, they often hand over a severance package based on the bare minimums set by the provincial Labour Standards Act. They might offer you just two or three weeks of pay, claiming it is all you are legally owed. This is one of the most common and expensive myths in Canadian employment law. For non-unionized employees, the statutory minimums are just the floor; the “common law” provides the ceiling.
The common law is the system of rules created by judges in courts over decades. Unless you signed a heavily restrictive employment contract that legally limits your rights, you are generally entitled to common law reasonable notice. Whether you are a 60-year-old executive in St. John’s or a 30-year-old administrator in Gander, calculating this amount is not a simple math equation. This guide breaks down the “Bardal factors” that legal professionals use to calculate what you are truly owed, helping you avoid leaving tens of thousands of dollars on the table.
Step-by-Step Process in Newfoundland and Labrador
Calculating common law severance requires looking at your specific personal circumstances. The goal of severance (reasonable notice) is to provide you with a financial bridge to support you while you look for a similar job in your local market.
Step 1: Analyzing the “Bardal Factors”
Lawyers and judges do not use calculators; they use legal precedents based on four core criteria known as the Bardal factors. First, they look at your Age. Older workers generally receive more severance because it is statistically harder to find new employment. Second, they evaluate your Length of Service . A loyal employee of 20 years will receive vastly more than someone who worked there for 8 months. Third, they consider the Character of Employment. Highly specialized professionals or senior managers often require more time to find a matching role. Finally, they look at the Availability of Similar Employment in Newfoundland and Labrador.
Step 2: Checking Your Employment Contract
Before demanding 18 months of pay, your lawyer will ask to see the employment contract you signed when you were first hired. Many modern employers include a “termination clause” designed to strip away your common law rights and limit you to the Labour Standards Act minimums. However, these clauses are notoriously difficult to draft correctly. If the clause violates even a minor technicality of the law, a judge in the Supreme Court of Newfoundland and Labrador may declare it void, restoring your full common law rights.
Step 3: Calculating “Total Compensation”
A fair severance package is not just based on your base salary. Common law dictates that you must be kept “whole” during your notice period. This means your severance should include the value of your benefits, your average commissions, expected bonuses, car allowances, and RRSP matching programs 📈. If you typically earn a $10,000 annual bonus, that must be factored into your total monthly compensation calculation.
How Much Does it Cost in Newfoundland and Labrador?
Getting a professional calculation of your severance entitlements is the best investment you can make after being fired. Typical costs in CAD are:
| Type of Expense | Estimated Cost (CAD) |
|---|---|
| Severance Package Review Consultation | $300 – $600 |
| Lawyer Negotiation (Contingency) | 25% – 35% of the newly negotiated funds |
| Employment Contract Review | $250 – $500 |
| Litigation Retainer (If going to court) | $3,000 – $5,000+ upfront |
How Long Does the Process Take?
An experienced employment lawyer can usually calculate your common law entitlement range during your very first one-hour consultation. They will compare your Bardal factors to past cases in the province to give you a strong estimate (e.g., “You are owed between 12 and 15 months”). Actually securing that money from the employer usually takes 4 to 8 weeks of negotiation. If the employer refuses to pay the common law amount and relies on a disputed contract clause, resolving the matter through the Supreme Court can take 1 to 2 years.
Frequently Asked Questions (FAQ)
Is there a rule of “one month per year of service”?
No. While this is a common myth, the law does not work this way. A young employee with 10 years of service might get 8 months, while a 62-year-old employee who only worked for a company for 2 years might also get 8 months because of their age and the difficulty of finding new work.
What happens if I find a new job quickly?
Under common law, you have a “duty to mitigate” your damages. This means you must actively look for work. If you find a new, similar job very quickly, your former employer’s obligation to keep paying you severance may be reduced or eliminated from the date you start the new job.
Do I get severance if I was fired for cause?
If an employer proves “just cause” (like severe theft, fraud, or intentional sabotage), you are not entitled to any severance. However, true “just cause” is incredibly difficult for an employer to prove in Canada, and many “for cause” terminations are actually wrongful dismissals.
Can I use an online severance calculator?
Online calculators can give you a very rough estimate, but they cannot read the termination clause in your employment contract, nor can they assess the specific job market in your region of Newfoundland and Labrador. A lawyer’s review is always necessary.
Are my medical benefits covered during the severance period?
Generally, yes. Under common law, your employer is supposed to maintain your health and dental benefits during your entire reasonable notice period. If they cut off your benefits and you incur a massive medical bill, the employer could be held liable for the cost.
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