Severance and Termination Pay in Alberta

Alberta does not have a standalone law called "severance pay." Employers and employees searching for that term are usually looking for one of two different things: the statutory termination notice (or termination pay in lieu of notice) set out in Alberta's Employment Standards Code, or the broader common-law reasonable notice that non-unionized employees may be owed on top of that statutory floor. This page walks through both, using the terminology Alberta's own legislation actually uses.

The distinction matters because the numbers are very different. The Employment Standards Code sets a modest minimum. Common-law reasonable notice, decided case by case by a court, is frequently much larger. Confusing the two is the single most common mistake in Alberta termination disputes.

Alberta Does Not Have a "Severance Pay" Law

Some Canadian jurisdictions, and the federal Canada Labour Code, use the word "severance pay" as a distinct entitlement. Alberta's Employment Standards Code does not. Instead, it uses two related terms:

• Termination notice: written advance notice an employer must give before ending employment without cause.
• Termination pay: pay in lieu of that notice, equal to the wages the employee would have earned working their regular hours through the notice period, if the employer ends employment immediately instead of having the person work out the notice.

An employer can choose to give working notice, pay in lieu, or a combination of both, as long as the total meets the statutory minimum. This statutory framework is a floor, not a ceiling. It says nothing about what a court might separately award under common-law reasonable notice, which is a different legal track covered further down this page.

The Statutory Termination Notice Schedule

Section 56 of the Employment Standards Code sets minimum notice (or termination pay) based on how long the employee has worked for the employer. The schedule applies to most provincially regulated, non-unionized employees in Alberta.

Two details in this schedule catch people off guard. First, there is a hard eligibility floor: an employee who has worked 90 days or less can be let go without any statutory notice or pay at all. Second, the jump from 1 week to 2 weeks happens at the 2-year mark, not gradually, so an employee let go a few days before a service anniversary can receive noticeably less than a colleague let go a few days after it.

Employers may agree to a longer notice period in an employment contract or offer more than the Code requires, but they cannot contract below these minimums. Where wages vary week to week, termination pay is generally based on the employee's average earnings, and it must still be paid within the timelines the Code sets for final wages.

When No Notice or Termination Pay Is Required

The Employment Standards Code lists specific situations where an employer does not have to provide termination notice or termination pay. The main ones are:

• The employee has been employed for 90 days or less.
• The employee is dismissed for just cause (serious misconduct, not ordinary performance issues).
• The employment is for a definite term or specific task of 12 months or less, and it simply ends on schedule.
• The employee works in construction or land clearing/brush clearing.
• The employment is genuinely seasonal and ends at the close of the season.
• A strike or lockout makes it impossible for the employer to keep providing work.
• The employee is a casual worker who declines an offer of work.
• A laid-off employee fails to return to work within 7 calendar days of being recalled.

"Just cause" is a high bar in Alberta, as it is across Canada. A single mistake, a personality conflict, or a general sense that someone is not a good fit rarely meets it on its own. Employers who dismiss for cause and get it wrong can end up owing both the statutory notice they skipped and, potentially, common-law damages for termination without cause.

Temporary Layoffs Are Not the Same as Termination

A temporary layoff, where an employer reduces an employee's hours to zero (or below the minimum threshold) with the expectation of recall, is treated differently from an outright termination. Under Alberta's rules, a layoff can run for up to 90 days within a 120-day period before the employee is deemed to have been terminated.

If the layoff period is not extended by continued pay or benefit contributions and the employee is not recalled or does not consent to an extension, the employer generally owes termination notice or termination pay calculated from the original date the layoff began, not from the day the deemed termination occurs. Employers sometimes assume a layoff quietly resets the clock. It does not.

Group Terminations: 50 or More Employees

Alberta has separate rules when an employer plans to terminate 50 or more employees at a single location within a 4-week period. In that situation, the employer must give the Minister responsible for employment standards written notice, generally at least 4 weeks in advance of the first termination in the group.

This "notice to the Minister" requirement is on top of, not instead of, the individual termination notice or pay each affected employee is still owed under the regular schedule above. Group termination rules generally do not apply to genuinely seasonal or fixed-task jobs ending on schedule, or to the start of a temporary layoff itself, though individual notice still applies if a layoff ultimately converts into a termination.

Common-Law Reasonable Notice: Often the Bigger Number

The Employment Standards Code sets a legal minimum. It is not the ceiling. Most non-unionized Alberta employees dismissed without cause also have a common-law right to "reasonable notice" of termination, and in many cases this is substantially more generous than the statutory schedule above.

Reasonable notice is not calculated from a fixed table. Courts weigh what are commonly called the Bardal factors: the character of the employment (more senior or specialized roles tend to support longer notice), the employee's length of service, their age, and how available comparable employment is given their training, experience, and qualifications. Courts weigh these factors together rather than applying a formula.

For decades, Alberta courts treated roughly 24 months as a practical upper limit for reasonable notice, reserved for long-serving, senior, or older employees in specialized roles with few comparable jobs available. That ceiling is not absolute. In 2025, the Court of King's Bench of Alberta (Lischuk v K-Jay Electric Ltd, 2025 ABKB 460) awarded 26 months in an exceptional case involving a long-tenured senior employee with limited transferable skills, showing that the 24-month figure is a strong convention rather than a hard statutory cap.

An employment contract can validly limit an employee to the statutory minimum instead of common-law notice, but only if the termination clause is clearly drafted and does not attempt to contract below the Code's minimums at any point during employment. A poorly drafted or overreaching clause is often struck down entirely, in which case the employee falls back on full common-law reasonable notice. For a broader look at how this compares across the country, see severance pay in Canada.

Where These Claims Are Decided

Statutory complaints, disputes over the Employment Standards Code minimums themselves, are handled through Alberta Employment Standards. Common-law wrongful dismissal claims, seeking reasonable notice above the statutory floor, are civil lawsuits.

Claims up to $100,000 can generally be filed in the Civil Claims division of the Alberta Court of Justice (the province's small claims court). Larger claims, which is common in reasonable-notice cases involving longer-service or senior employees, go to the Court of King's Bench of Alberta, which has no monetary ceiling. Employees weighing a claim should also be mindful of mitigation obligations (a reasonable, documented job search) and applicable limitation periods, since both statutory and common-law claims are time-limited.

This page is part of RecordingLaw's broader look at Canada employment law. For rules in other provinces and other areas of Canadian law, see Canadian law by province.

Disclaimer

This article provides general information about termination notice and termination pay rules in Alberta. It is not legal advice and does not create a lawyer-client relationship. Employment Standards Code minimums and common-law reasonable notice depend on individual facts, including the specific wording of any employment contract. Anyone facing a termination or considering a claim should review their own documents and, where the amounts involved are significant, consult a licensed Alberta employment lawyer.