Gender Bias in the Negotiation of Severance Pay in Lieu of "Reasonable Notice"

Kenneth Wm. Thornicroft

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DOI: 10.2190/WR.16.2.b

Abstract

Canadian employees working under indefinite-term employment contracts are presumptively entitled to "reasonable notice" of dismissal. Employees dismissed without just cause or reasonable notice can sue for "severance pay in lieu of reasonable notice." The damages payable (which can range up to 24 months' wages) reflect the compensation the employee would have earned during the reasonable notice period. Although there is no statutory or common law formula for determining reasonable notice, various factors, such as the employee's position, tenure, and age, and extant labour market conditions, are relevant considerations. The present study addresses the issue of whether women face gender-based discrimination (or gain any advantage) in the determination of their reasonable notice entitlement. This study examines the impact of gender on negotiated outcomes in wrongful dismissal claims, and the results indicate that women suffer a marked disadvantage in negotiated severance pay settlements.

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