Statutory severance is only mandatory in certain conditions. Under the Ontario Employment Standards Act, statutory severance applies when the employer has an annual payroll of $2.5M or more and the employee has 5+ years of service. Statutory notice (or pay in lieu) is broader and applies to most terminations without cause. Other provinces have different rules. Common-law severance, separate from statutory, applies in most without-cause terminations unless the employment contract limits it.

Notice (or pay in lieu) is the period of advance warning the employer must give before termination, set by the Ontario ESA: 1 week per year of service up to 8 weeks. Statutory severance is a separate additional payment, payable only when the employer has $2.5M+ in payroll: 1 week per year of service up to 26 weeks. Common-law severance is a third concept entirely, set by the courts: typically 3-4 weeks per year of service, capped around 24 months.

Common-law severance estimates use the Bardal factors from the 1960 case Bardal v Globe and Mail: age, length of service, character of employment, and availability of similar employment. There is no formula, but typical court awards work out to 3-4 weeks per year of service for non-executive roles, rising for older employees in senior positions. Most awards cap around 24 months. The calculator estimates use 3.5 weeks per year as a midpoint and apply the 24-month cap.

The statutory portion of this calculator uses Ontario Employment Standards Act formulas. Other provinces have different statutory minimums. British Columbia, Alberta, Quebec, and the federal Canada Labour Code each have their own tables. The common-law estimate is broadly applicable across Canada because common-law severance is a Canadian principle that applies in every province except Quebec, where the Civil Code applies a different framework.

Yes, especially for terminations without cause involving employees with 3+ years of service or senior roles. The calculator gives a reasonable estimate, but actual severance is determined by the employment contract, the specific circumstances of termination, and the employee's mitigation efforts. Most Canadian employment lawyers offer fixed-fee severance reviews. Workzoom's HR platform tracks employment history, including hire dates, position changes, and pay history, which is what employment counsel needs to calculate accurate severance.