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What to do when you’ve lost your job

As some of the 39,400 Canadians who lost their jobs this past July can attest, the experience is right up there with divorce and the death of a parent when it comes to stressful life events. Whether it’s a sudden firing or a dismissal that’s been in the works for a while, it still hurts. There’s the obvious financial toll, not to mention the potential impact on a person’s self-esteem. The good news is there’s lots of help for the former.

“Losing a job means losing income,” says Lucie Tedesco, commissioner of the Financial Consumer Agency of Canada, which has just released a free online guidebook to help people deal with the fallout called Losing Your Job . “Depending on the circumstances, those who’ve lost a job will likely need to reduce expenses and also manage their debt, savings and any severance pay or early retirement offer they may receive. They may have to look at ways to replace their income by claiming benefits and insurance and finding new sources of income.”

Canada’s unemployment rate sits at 6.9 per cent. The best thing people can do if they’ve lost their job is to become informed, says Sara Forte, a lawyer at Vancouver’s Hamilton, Howell, Bain and Gould Employment Lawyers.

“Know your rights,” Forte says. “Many employees accept severance packages that are far below what they are entitled to simply because they’re not aware that they may be entitled to more. The cost of a legal review of a severance package is often minimal in comparison to the additional amounts that can be negotiated once an employee knows their rights and entitlements.

So how can you tell if you’re eligible for a severance package in the first place?

“If you have worked somewhere for more than three months, and you are not being fired ‘for cause’, then you should get some amount of severance, though the amount you are entitled to receive varies dramatically,” Forte says.

Getting fired for cause makes things more complicated.

“If you have been properly fired for cause, then you are generally not entitled to any severance nor any employment insurance,” Forte says. “Because this places employees in a very difficult situation, employers have to meet a high threshold to prove that they have cause, for example extremely serious misconduct by the employee or failure to meet standards despite repeated warnings over a long period of time.”

Quitting your job also means your financial options are limited. In most cases, you have little or no benefits or rights once you’ve left, Forte notes.

“It’s important to think about this decision very carefully and get some advice before you decide to walk out the door,” she says. “If you quit, you’re generally not entitled to receive employment insurance benefits, even if you’re out of work and looking for a new job. There is an exception if you can prove you have been ‘constructively dismissed’ or forced to quit, though this only applies in unusual situations and can be very difficult to prove.”

Forte recommends that those who are eligible for employment insurance actually apply for it.

“Often people delay in making this application because they’re upset over an unexpected job loss, because they’re confident they’ll get a new job, or because they feel badly about seeking financial assistance,” she says. “It’s best to get this application in right away so that the funds are there if you need them. You’ve paid in to this insurance plan so make sure you use it.”

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