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If an employee is laid off during sick leave – the employer's reason is structural change within the company – is there a chance to bargain a better severance?


Bruce Sandy, Principal of Pathfinder Coaching and Consulting, Vancouver

If the employee was or is on long-term disability (LTD) and not just regular sick leave, then this may improve the chances of getting a better severance even further since company officials will want to get the employee off its LTD plan.

Even if the company offers a legitimate reason for restructuring and layoffs, it will likely feel some guilt for letting go of the employee while on sick leave.

An employment or labour lawyer can help to clarify an appropriate severance, considering labour laws, the employee's age, years of service, health, and chances of re-employability. If the company is not being fair during negotiations, the employee may need to retain an employment lawyer to secure an appropriate severance.

As part of the severance agreement, the employee and/or the employee's lawyer will want to ensure that the company provides a positive reference – both written and verbal – for the employee. They should provide the employer a sample reference letter and a script that company officials will have to refer to when providing references.

When the employee is asked why they left, she simply needs to say that her previous position was eliminated in a restructuring by the company. The employee should not be concerned about the layoff affecting future employment opportunities, especially if the company provides an appropriate reference.

The employee will also want to do due diligence or research on any companies that she applies to with respect to employment practices and/or agreements, possible restructuring plans, work environment, company culture and leadership. In other words, apply the lessons gleaned from her experience to make an informed choice about a future employer.


Daniel Lublin, Partner at Whitten & Lublin employment lawyers, Toronto

This is precisely the type of situation when demanding a better severance package makes sense.

A termination during your sick leave may be illegal if the reason was all or in any part related to the fact you were sick or away from work.

In these situations, the company would have to show that your job was truly eliminated and that you were not merely replaced by someone else.

Even if there was a legitimate reason for the termination, such as a mass layoff, the fact that you were on leave when it occurred should assist you in pursuing a better severance package.

Keep in mind that many organizations do not make their best severance offers right away and there may be a better deal waiting for you if you pursue it properly.

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