Should you take the buyout?

Photo: The Canadian Press

KBA Law partner Kimberly Boara Alexander

What would you do if offered a voluntary severance package: celebrate, cry or crunch the numbers?

Leaving a job can be an emotional experience, but it pays to remain calm and check out the options in a systematic way before making a decision.

"What's right is going to be different for each person, depending on where they are in their career, and what they expect will happen next," said KBA Partners LLP partner Kimberly Boara Alexander, who practices career law in Toronto.

"Really, it's about making the right decision for that person at that particular time in their lives," Alexander said.

"Depending on how it's structured, that buyout package could be a real windfall."

Ideally, you would assemble a team of advisers with different skills, including an accountant to help with tax questions, a financial adviser, a recruitment or career professional familiar with your location and industry, as well as a lawyer familiar with employment law.

However, the costs of meeting with such a team can add up, so there are also some basics that can help chart a path to the best outcome on your own.

Those faced with such a choice should review the following:

• details of the severance offer, preferably in writing
• documents showing pension and other benefits
• individual employment contract or union contract, if there is one
• the letter of employment received at time of hiring and similar letters received with promotions or other changes.

Using this information, compare what you'd get under a voluntary package versus an involuntary termination.

Depending on what the employment contract looks like, a person may ultimately receive more through involuntary termination, Alexander said.

"If you leave at the employer's behest because they've terminated you without cause, you're entitled to — at very minimum — statutory notice and severance."

The terms of statutory notice are spelled out by federal or provincial law, depending on the circumstance.

In general, statutory provisions should be seen as minimums — not maximums — says Alexander.