The federal government recently fixed February 1, 2024 as the day on which the Canada Labour Code (“Code”) will be amended to establish a graduated notice of individual termination of employment for federally-regulated employees ranging between two and eight weeks, depending on the length of continuous employment with the employer. These changes were first introduced in the fall of 2018 by way of Bill C-86/ Budget Implementation Act, 2018, No. 2, but the coming into force date was unknown until recently.
Currently and until January 31, 2024, the federal termination provisions provide for a minimum of two weeks’ notice or wages in lieu of notice, after three months of continuous employment with the employer. The transitional provision explains that if an employer gives notice of termination to an employee on January 31, 2024, that version of the Code applies to the employer and the employee in respect of individual termination. Then, effective the next day on February 1, 2024, employers will be required to follow the following graduated notice provisions under Part III of the Code:
- 2 weeks’ notice or pay in lieu of notice, or a combination of both, for employees with between 3 months and less than 3 years of continuous employment with the employer;
- 3 weeks’ notice or pay in lieu of notice, or a combination of both, for employees with 3 years of continuous employment with the employer;
- One additional week for each additional year of employment, up to a maximum of 8 weeks’ notice.
For unionized employees, new section 230(2) will require notice to the union and the employee for any redundancy, for at least the same length of time as noted above.
This graduated notice of individual termination is similar to provisions from provincial employments standards legislation.
Under both current and upcoming federal Code provisions, these notice requirements do not apply to an employee whose termination is for just cause.
It is important to recognize that employees in federally regulated businesses to whom the Code applies have the right to challenge a termination as an unjust dismissal under the Code. The unjust dismissal section 240 of the Code applies to non-union employees, excluding managers, whose employment is terminated without cause and is not due to a lack of work or the discontinuance of a function. The unjust dismissal challenge allows non-union employees to have rights similar to unionized employees claiming a right to remain in their position. This right continues and is not removed by the new graduated notice provisions.
In addition, on February 1, 2024, employers will be required to give an employee whose employment is terminated a statement of benefits setting out: vacation benefits, wages, severance pay and any other applicable benefits and pay. This requirement already exists for group termination, but commencing February 1, it will apply to individual termination as well.
Please contact a member of our Labour and Employment Group if you have any questions regarding the new graduated notice of individual termination requirements coming into force on February 1, 2024.