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Upset businesswoman staring at a pink slip.

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The question

I am 58, and over the last three years my employer has reduced my salary by 15 per cent. Over the last two years, negative comments started popping up about my performance and the fact that my salary was one of a very senior resource.

I defended myself against the negative comments, even providing proof of their inaccuracy, but was not successful in convincing my leader that they were not justified.

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Over the past 14 years, I worked in the same job, but as a result of industry consolidations, I ended up working for four companies, each one gobbling up the previous one. The last company to buy us (a large global company with over 325,000 employees) did so three years ago and has bridged my service, giving me 14 years of service as an IT professional. My employer offers a severance package when it lays people off, but what legal obligations, if any, do companies have with respect to severance if they fire someone?

If I were to get a job elsewhere, how much notice am I legally required to give?

The answer

Your employer cannot substantially reduce your salary over time or even in one whack. This is known as a "constructive dismissal" in workplace law. Usually, a 15-per-cent pay reduction in a non-variable compensation scheme will trigger this type of claim. If you are constructively dismissed, you may be able to leave and claim damages for severance. Speak to an employment lawyer first.

Alleged poor performance will not affect your right to severance. Employees are too often concerned about the impact of performance on severance. If you are let go, it will not make much of a difference.

A "lay off" is the same as a "termination." If you are asked to leave work, in one form or another, and you have not engaged in any form of misconduct, such as theft, you are entitled to severance pay.

If you find another job and must resign, you have to provide the advance notice of resignation specified in your employment contract, if you have one. If not, you must provide a fair enough warning to your employer so that they can replace you, without a significant inconvenience.

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Good luck!

Daniel Lublin is a nationally recognized workplace law expert and a partner at Whitten & Lublin, where he represents both individual and corporate clients. Follow him on Twitter: @danlublin

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About the Author
Globe Careers employment law expert

Daniel is a nationally recognized workplace law expert and a partner at Whitten & Lublin (www.toronto-employmentlawyer.com), where he represents both individual and corporate clients. Daniel frequently writes and appears in the media as a commentator for workplace legal issues. Since 2008, he has been named as one of Canada's top employment lawyers. More

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