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No it’s not that simple.  A company may believe that you are not entitled to severance but it’s very possible they are wrong.

A useful decision on who is entitled to severance is the Ontario Court of Appeal decision in Keenan v. Canac Kitchens Ltd.  This decision makes it clear that just because your relationship with a company may be less than “normal”, it does not necessarily mean that you are not entitled to termination payments like any other employee.

The case involved two individuals who had worked for Canac Kitchen for approximately 25 years.  Canac decided to terminate their contracts and provided them with no severance because it was believed they were independent contractors since they worked under subcontractor agreements.

The plaintiffs disagreed, stating that they should have been provided with termination payments on the basis that they were either employees or dependent contractors.

While the employees did work for Canac throughout the full 25 year period, during the last 2 years they also worked for a competitor on a part-time basis.

The Court, in reviewing the facts, made it clear that the simple fact that a person works for more than one employer is not enough to determine the characteristic of the working relationship (whether a person is an employee, contractor or dependent contractor).  Rather, it’s important to look at the relationship as a whole to come to a conclusion as to the proper classification.

The Court then found that, even though the plaintiffs worked for another employer, the vast majority of their time was spent working for Canac.

This fact, along with a review of the relationship as a whole, convinced the Court that the plaintiffs were entitled to termination payments as dependent contractors.  Canac was then ordered to pay 26-months pay to each of them.  The size of the payment was influenced by the fact that the plaintiffs had roles that were considered supervisory in nature with significant responsibilities.

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