What to Review in a Severance Package

Most packages include a deadline to accept, often with a reduction if the response is late. Check whether the deadline is reasonable given the complexity of the document, whether there is an option to seek independent legal advice, and whether the deadline is stated in business or calendar days.

Payments usually combine statutory minimums under the Ontario Employment Standards Act with common-law reasonable notice, subject to an enforceable termination clause in the employment agreement. The realistic range depends on years of service, role, age, and the availability of comparable employment — sometimes called the Bardal factors.

An offer at the low end of the range can often be negotiated upward with a structured demand. An offer near the top of the range may be final.

Health, dental, and disability benefits often continue for a set period, sometimes only to the statutory minimum. If you are relying on disability coverage during a sensitive period, the continuation of that coverage is critical — and worth negotiating separately.

Whether short-term or long-term incentives continue to be paid through the severance period depends on the plan documents, the employment agreement, and how the package is structured. Equity with unvested tranches requires particular attention.

A non-disparagement clause is usually mutual in principle but one-sided in effect. Consider whether the package includes an agreed reference letter, a neutral reference commitment, or a provision for confirming specific facts only.

The release is what the employer is buying. It should be proportionate to the payment, with carve-outs for statutory entitlements, accrued vacation, and claims that cannot be released at law.