Did you sign a non-compete clause that prevents you from further employment?

The purpose of severance has been described by the Courts as a means to help tide over dismissed employees until a time they can find reasonable, comparable re-employment. Accordingly, one of the factors that may have a direct impact on any calculation of severance amounts is what (if any) restrictive covenants apply to the employee post-dismissal.

Take this common example: a dismissed employee is restricted for a period of one (1) year post-termination from working in a similar role for a competing employer. This employee’s job prospects will be necessarily impacted by the non-competition clause as their most likely avenues to find reasonable, comparable re-employment are blocked for the foreseeable future.

In such cases, the Courts typically increase the amount of severance that a dismissed employee is owed to help compensate for the extra time that will be needed to find new work. The exact amount of extra severance will dependant on a variety of different factors, such as:

  • whether the former employer has indicated that the restrictive covenants will be waived;

  • the degree of interference the restrictive covenants will have on the dismissed employee’s job prospects; and

  • the length of time the restrictive covenants will be in effect post-dismissal.

If there is a restrictive covenant that will apply to you, it is best to speak with an employment lawyer to better understand how such contractual provisions may impact any related severance entitlements.

Employment and Labour Laws are not always straightforward, but whether you are an employee or an employer, understanding your rights and duties will only stand to benefit you. Reach out to an employment lawyer or labour lawyer today if you have any questions and be sure to get what you deserve and safeguard yourself for the future. The lawyers at Vey Willetts LLP have a proven track record and are happy to assist.  

Our employment lawyers and labour lawyers serve clients throughout Ontario. 

Call us today at 1-800-296-7989 or fill out our online form.