Terminations & Severance
Guidance on structuring individual dismissals and severance packages to minimize legal exposure.
Learn more Restructuring & Workforce Changes
Restructuring and workforce change lawyer for employers.
Temporary layoffs, reorganizations, and business transitions create legal exposure precisely when you can least afford it. We help you plan workforce changes to control cost and reduce the risk of claims.
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Restructuring in Ontario
The risk is in the execution
Reductions, reorganizations, temporary layoffs, and business transitions are legitimate business decisions, but each carries employment-law exposure that's easy to trigger and expensive to fix. The difference between a clean restructuring and a wave of claims is usually planning: selection, notice, documentation, and sequencing.
Temporary layoffs aren't automatically available
Many employers assume they can temporarily lay off employees to manage a downturn. In fact, unless the employment contract clearly permits it (or there's an established practice), imposing a layoff can itself be a constructive dismissal, turning an intended cost-saving into a severance liability. The Employment Standards Act, 2000 (the "ESA") also limits how long a temporary layoff can last before it becomes a termination.
Two of the most common, and costly, restructuring mistakes are assuming you can lay employees off without a contractual right to do so, and imposing changes to employees' terms without proper notice or consideration. Both can convert a business decision into a constructive dismissal. Planning ahead avoids both.
Mass terminations have their own rules
When a restructuring involves terminating 50 or more employees at a single location within a short window, enhanced group-notice requirements and a filing obligation apply for mass terminations. Getting the thresholds and timing right matters.
Changing terms, and selling the business
- Changing terms of employment (pay, role, or structure) generally requires proper notice or fresh consideration to avoid a constructive dismissal claim
- Selling or transferring a business: employees' service typically continues under the ESA, and the treatment of the workforce needs to be planned into the deal
How we help
- Plan the selection, notice, and documentation for reductions and reorganizations
- Advise on temporary layoffs and whether you have the right to impose them
- Manage mass-termination notice and filing obligations
- Structure changes to terms, and workforce issues in a sale, to minimize claims
Restructuring & Workforce Changes FAQs
Common questions about restructuring.
Practical, Canadian-law guidance for employers planning workforce changes, across Ontario and Canada.
Yes, if the employment contracts clearly allow it, or there's an established practice, then a temporary layoff may be permitted. Otherwise, imposing a layoff can be a constructive dismissal, even if you intend it to be temporary. The ESA also caps how long a layoff can run before it becomes a termination. It's worth confirming your position before you act.
Terminating 50 or more employees at one location within a short period triggers enhanced group-notice requirements and a filing obligation with the province, separate from each employee's individual severance. Planning the timing and process is essential at that scale.
Material changes to pay, role, or structure generally require reasonable advance notice or fresh consideration. Imposing them unilaterally can amount to constructive dismissal. With planning, changes can usually be made; the key is how they're introduced.
Under the ESA, employees' service typically continues with the buyer, and their accrued entitlements carry over. How the workforce is handled should be planned into the transaction to avoid unexpected liabilities on either side.
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Planning a restructuring?
We'll help you plan the process to manage cost without creating new claims.
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