New Canada Labour Code Termination Entitlements to Take Effect February 1, 2024
The following blog addresses the New Canada Labour Code Termination Entitlements expected to come into effect February 1, 2024, and their impact on federally regulated private sector employees.
What is the Canada Labour Code?
The Canada Labour Code, Part III (the “Code”) sets out rights on termination of employment for federally regulated private sector employees. The federal government has announced that the new entitlements will change the minimum notice of termination required for an individual termination.
Current Entitlements to Notice of Termination
The Code provides certain minimum standards for notice of termination or pay in lieu of notice. The notice of termination or pay in lieu of notice is typically determined based on an employee’s length of service with the employer.
For example, an employee with less than three months of employment is not entitled to notice or pay in lieu of notice. An employee with at least three months of continuous employment is entitled to a minimum of two weeks’ notice or pay in lieu of notice.
New Entitlements to Notice of Termination
Effective February 1, 2024, the Code will provide new standards for notice of termination or pay in lieu of notice. These new standards will require employers to increase the minimum notice of termination required for individual termination. This means that employers will have to give employees a graduated notice of termination (or pay in lieu, or combination of both), based on the length of the employee’s continuous employment.
For example, an employee with at least three months and up to three years of continuous employment will still be entitled to two weeks’ notice or two weeks’ pay in lieu of notice. However, once an employee completes at least three years of continuous employment, their entitlement will increase to three weeks. The entitlement will increase in one-week increments for each additional year of employment, up to a maximum of eight weeks, as shown in the chart below:
| Length of Continuous Service | New Notice Entitlement |
| At least 3 months, up to 3 years | 2 weeks |
| At least 3 years, up to 4 years | 3 weeks |
| At least 4 years, up to 5 years | 4 weeks |
| At least 5 years, up to 6 years | 5 weeks |
| At least 6 years, up to 7 years | 6 weeks |
| At least 7 years, up to 8 years | 7 weeks |
| 8 years or more | 8 weeks |
WRITTEN STATEMENT OF BENEFITS
Effective February 1, 2024, the Code will also require employers to provide a written statement of benefits to terminated employees. This written statement of benefits must include the employee’s vacation benefits, wages, severance pay, and any other applicable benefits or pay.
If an employer elects to provide an employee with pay in lieu of notice, the employer must deliver the statement of benefits to the employee no later than the date of termination. If an employer provides an employee with notice of termination instead, the employer must deliver the statement of benefits to the employee no later than two weeks before the date of termination.
TAKEAWAYS
Labour laws and regulations evolve over time, and it is crucial to ensure that you have the latest information to understand how these changes may impact your situation or employment practices.
Whether you are an employer or an employee who needs assistance with workplace matters, including any questions you may have about the new termination entitlements, we would be happy to assist you. Please contact our team of Toronto employment lawyers, Sultan Lawyers, at 416-214-5111 or here.
