What Is the Severance Pay Amount in Ontario?


Quick Answer

The Ontario Employment Standards Act requires that employers compute severance pay as a terminated employee's regular weekly wage multiplied by the sum of the employee's number of years of employment, with any partial years pro-rated. This amount is capped at 26 weeks' pay, as of 2015.

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Full Answer

Ontario requires that employers provide severance pay to terminated individuals if they have worked for the employer for at least five years, which do not need to be consecutive, and the employer either has a total Ontario payroll of $2.5 million or more or has terminated at least 50 employees over the past half year due to a partial or full wind-down of the business. Severance pay is separate in Ontario from termination pay that must be awarded in lieu of any required advance warning of an employee's termination.

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