Under federal jurisdiction, for 12 months of continuous service, which severance calculation is greater?

• A. 2 days wages for each completed year
• B. 5 days wages in total
• C. 1 day wages per month
• D. 3 days wages per year

Answer: (B)

Under federal jurisdiction, severance pay for an employee with at least 12 months of continuous service is a fixed amount: five days’ wages in total. This means that after a year of service, the severance entitlement is five days of pay, regardless of other year-by-year or month-by-month calculations. The other formulas describe different ways of calculating severance that don’t apply to the federal rule for a single year of service (two days per completed year, or three days per year, or one day per month). Therefore, for 12 months of continuous service, the five days’ wages in total is the standard federal entitlement. (Note: there is an overall cap on severance pay under the Canada Labour Code, but it does not change this basic entitlement for a year of service.)