What is a Layoff?

by | Mar 28, 2016 | For Employees

What is a layoff?  This question may seem simple to many, but it is not.  Employees and employers often misuse the term layoff and the effects can be significant.

A True Layoff

A true lay off involves a situation where the employee knew in advance that her employment would end at a certain point.  At the time of the layoff, the employer and the employee intend for her to return to work at a later date.  The temporary layoff, according to the Employment Standards Act, must be 13 weeks or less in a given 20-week period.  If the layoff is to be longer than 13 weeks, it must be less than 35 weeks and the employer will typically continue benefits during this period.

An example of a true layoff is a seasonal employee whose employment contract states that each year at winter-time she will be laid off for 10 weeks.

Common use of Layoff

Many people say they have been ‘laid off’ when they have actually been terminated.  If an employee has been laid off and there is no possibility that he will return to work for the employer this is a termination.  A termination means the employer has obligations to provide notice or pay in lieu of notice of termination.  See here for information about employee entitlements at termination.

An example of this situation is when an employee receives a severance or termination package from his employer, but the employer says “we have to lay you off.”

When is a Layoff Actually a Termination? 

Occasionally, an employer will lay off an employee with the intention to recall the employee at some point in the future.   Unless the employee has agreed to the possibility of a layoff in writing in a legally enforceable contract, or a layoff is an industry custom like the construction industry a layoff is generally a termination at law.  In this situation, the employer generally has a legal obligation to provide the employee with notice of termination (or pay in lieu of this notice).  This was confirmed by the Ontario Court of Appeal Elsegood v. Cambridge Spring Service (2001) Ltd. and many times since then.

If you have been laid off, you may have rights beyond being recalled to work at some point and a lawyer at MacLeod Law Firm would be happy to assist you. Please contact us at [email protected] or 647-204-8107.

The material and information in this blog and this website are for general information only. They should not be relied on as legal advice or opinion. The authors make no claims, promises, or guarantees about the accuracy, completeness, or adequacy of any information referred to in this blog or its links. No person should act or refrain from acting in reliance on any information found on this website or blog. Readers should obtain appropriate professional advice from a lawyer duly licensed in the relevant jurisdiction. These materials do not create a lawyer-client relationship between you and any of the authors or the MacLeod Law Firm.



Recent Posts

Laid Off and No Recall in Sight?

The Employment Standards Act the (“ESA”) contains a provision which allows for temporary lay-off. Pre Covid-19, the ESA told employers that they could lay off an employee for 13 out of 20 weeks, or 35 out of 52 weeks if the employer continues the employee’s benefits, for example.

read more

Paid Sick Leave? Sort of

With the numbers of COVID-19 cases rising again, especially in the GTA, many employees are asking me as a Toronto employment lawyer what happens if they become sick and they are forced to stay home for 14 days. Following the end of the Canada Emergency Response...

read more

Toronto Office

702 - 2 Bloor Street West,
Toronto, ON M4W 3E2

Barrie Office

277 - 92 Caplan Avenue,
Barrie, ON L4N 9J2

Collingwood Office

220 - 1 First Street
Collingwood, ON
L9Y 1A1



+1 (888) 640-1728


(866) 883-8445


[email protected]

Toronto Office

702 - 2 Bloor Street West, Toronto ON M4W 3E2

Barrie Office

277 - 92 Caplan Avenue, Barrie ON L4N 9J2

Collingwood Office

220 - 1 First Street, Collingwood, ON L9Y 1A1


Subscribe To Our Newsletter

Join our mailing list to receive the latest news and updates from our team.

You have Successfully Subscribed!