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Can a company terminate someone on parental leave? Add to ...

The question:

I work for a company and I am currently on a parental leave. The division of the company I work for has since been shut down and I have no job to return to.

Since I am on leave, I heard this news from a colleague at a different company – no one (not even human resources) reached out to me to advise me of the closure. I contacted HR to find out exactly what was going to happen to me. HR advised that most likely no “like positions” would be available to me when I return and I would be given a severance when I do “try” to come back. I was not told the exact dollar figure of the severance, although I think this is important information for me to know.

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Shouldn’t the company tell me exact figures of a potential severance package and secondly, shouldn’t they be obligated to provide me a position with a similar salary upon my return?

Since I’ll have exhausted my Employment Insurance benefits when my mat leave is over, I will not be able to claim any further EI if I cannot find work.

The answer:

There is a big difference between being fired because you are pregnant or on maternity leave and being fired simply while you are off on leave. Human rights and employment standards legislation across Canada prohibits termination and adverse treatment because of an employee’s intention to become pregnant, her pregnancy, or a maternity leave.

Most of these statutes also require reinstatement at the end of a leave subject to one exception: an employer can terminate an employee who is on maternity leave if the reasons for the termination are unrelated to the leave. Employers must prove that the termination was unrelated to the employee’s pregnancy or leave, and this is often not an easy task.

But where an entire division has been shut down or there is a large scale downsizing, it would appear that the termination is truly unrelated to a pregnancy or leave. In these circumstances, reinstatement is usually not required. The key is whether all of the other employees in the department also lost their jobs or whether some have been recalled after a temporary layoff or offered jobs in a different division.

Even if a termination occurring during a maternity leave is not illegal, employers are still required to pay severance. Severance should be based on factors such as age, tenure and position, but courts also expect companies to take into account the extra difficulty an individual off on leave will face when returning to work.

Employers like to use severance calculation formulas when dismissing a group of employees, but when this does not take into account personal factors, such as being off on leave, employees should complain. Courts consider re-employment prospects as one of the most significant factors in assessing how much severance to award.

These rights afforded women on maternity leave also extend to fathers who are on parental leave for the birth of a child.

There are no rules requiring an employer to immediately inform an employee on leave that the job no longer exists, because technically the termination is not effective until the leave is over. For this reason, severance packages are usually addressed when the leave is about to come to an end and the employee indicates she is returning to work. Some employers even take a wait-and-see approach, hoping that an employee they are planning to terminate first indicates that she is not planning to return.

Although employers are not required to provide the severance figures to an employee who is still on leave, some will agree to do so out of courtesy if the employee requests it and the employer’s decision to terminate her has already been made.

Employment Insurance benefits are a different story. Larger severance packages may have enough insurable time in them to allow a new claim for Employment Insurance after the severance runs out – assuming the employee is still unemployed.

Daniel A. Lublin is a workplace law expert and a partner at Whitten & Lublin.

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