Neo Financial Layoffs: What Ontario Employees Are Owed in Severance
Neo Financial employees in Ontario have a floor under Ontario law and, in most cases, a claim well above it. The termination clause, the equity plan and the letter's deadline decide how far above.
Key takeaways
- Check your start date against the 5 year line, including any earlier stint with the company. ESA s. 65(2) counts all time in the employer's employ, continuous or not, and crossing 5 years is what turns on severance pay.
- Check the for cause paragraph of your termination clause first. It is the sentence most likely to break the ESA, and a clause that promises notice weeks but says nothing about benefits or severance pay is suspect too.
- Check the package for benefits and pension contributions, not only base pay. Section 60(1)(c) requires benefit contributions through the statutory notice period, and a package built on salary alone is short.
- Check every vesting date in your equity plan against the end of a common law notice period, not your last day. Each grant that would vest inside that window belongs in the number you negotiate.
- Check the Record of Employment when it arrives for the reason code and the final figures. A code that says quit rather than shortage of work will hold up EI and needs to be corrected in writing.
In this article
- What did Neo Financial announce?
- What should you do in the first 48 hours?
- Does Ontario law apply to you if Neo Financial is based in Calgary?
- What is the ESA minimum for a layoff this size?
- What are you actually owed at common law?
- What do tech severance packages usually get wrong?
- What should you do before you sign?
✅Quick answer. You have been told your job at Neo Financial is gone. Under the Employment Standards Act you are owed notice measured in weeks, and at common law you are usually owed reasonable notice measured in months.
What did Neo Financial announce?
| At a glance | Detail |
|---|---|
| Announced | 8 September 2026 |
| Effective | Not disclosed |
| People affected | 102 employees |
| Share of workforce | About 10% of a workforce of about 1,111 |
| Layoff or furlough | Layoff; the company's wording is a decision to say goodbye to employees after rapid growth let complexity creep in, to run as a simpler and faster team |
| Canadian impact | Not disclosed; the Calgary based company also has locations in Winnipeg and Toronto and says the cuts reached nearly every part of Neo |
What should you do in the first 48 hours?
- The letter's date is the employer's choice, not a legal deadline; ask in writing for more time.
- Sign nothing, not the release; do not resign or accept a resignation framing.
- Keep the letter, your contract, the equity and bonus plans, pay stubs, your Record of Employment.
- Note the date, who told you and what was said.
- Apply for EI online once your last day of work has passed. Do not wait for the Record of Employment: applying more than 4 weeks after your last day can cost you benefits.
👥If your colleagues got the same letter. Compare notes on what each of you was offered. Count how many people at your location got a letter in the same 4 weeks, because 50 or more changes the ESA minimum. Do not sign together on the employer's timetable. Keep the letters, all of them; the count is what proves it.
Does Ontario law apply to you if Neo Financial is based in Calgary?
Yes. Ontario law follows the work, not the head office. If you work in Ontario, the Employment Standards Act, 2000 and the common law of reasonable notice set what you are owed, whichever entity signs your pay and wherever the company is based.
What is the ESA minimum for a layoff this size?
Under s. 57 you are owed 1 week of notice once you pass 3 months, 2 weeks from 1 to 3 years, then a week for each completed year to 8 weeks at 8 years. Section 61 lets the employer pay those weeks as a lump sum instead.
Section 58 raises that floor to 8 weeks where an employer terminates "50 or more employees at the employer's establishment in the same four-week period", and the count is per location, not company wide. It does not apply where the terminations at that location are 10 per cent or less of the employees who have been there 3 months and no part of the business is closing permanently (O. Reg. 288/01, s. 3(4)); the mass termination rules carry the rest.
Severance pay under s. 64 is a separate payment on top of notice, and packages often leave it out. You qualify at 5 or more years of service if the employer's payroll is $2.5 million or more, or if 50 or more people are severed within 6 months on a permanent discontinuance of part of the business. The payroll test is likely met, but the figure is the employer's to confirm, so ask for it in writing when you ask about severance pay.
Section 65 sets it at 1 week of regular wages for each completed year, plus a twelfth of a week for each extra month, capped at 26 weeks.
What are you actually owed at common law?
The first package is usually built on the ESA floor, and the common law usually sits well above it. How far above turns on your age, your length of service, the character of your role and how easy similar work is to find, the factors from Bardal v. Globe & Mail Ltd., 1960 CanLII 294 (ON SC).
The equity side has rules of its own, and severance for tech workers sets them out.
Run your own numbers
Enter your age, service, role and pay to see the ESA floor and your common law range.
What do tech severance packages usually get wrong?
- Unvested RSUs and options that would have vested in the notice period are recoverable: Wigdor v. Facebook Canada Ltd., 2026 ONCA 572, a recent 2026 Court of Appeal decision, and O'Reilly v. IMAX Corporation, 2019 ONCA 991.
- The bonus you would have earned in those months: active employment wording does not defeat it (Paquette v. TeraGo Networks Inc., 2016 ONCA 618).
- The termination clause: if one sentence in the termination section breaks the ESA, often the for cause paragraph, the whole clause fails and you are back to common law notice (Waksdale v. Swegon North America Inc., 2020 ONCA 391).
- The release: signing it ends every claim above it, whatever date the letter carries.
The notice period is a runway, and a new job inside it reduces what is owed for the remaining months without erasing the claim. EI and earnings in the ESA weeks are not deducted, and Brake v. PJ-M2R Restaurant Inc., 2017 ONCA 402 held earnings from a substantially lesser job are not deducted either.
What should you do before you sign?
The release is the one thing on the page that cannot be undone, so get the numbers checked before you sign it, not after. A free severance review is where to do that: the firm works on a percentage of what it recovers, and there is no fee if nothing is recovered.
This article is general information about Ontario law. It is not legal advice about your situation.
Frequently asked questions
What happens if the date on the letter passes and I have not signed?
Your ESA entitlements do not depend on signing anything, so notice and severance pay are owed whether or not a release is ever signed. The part of the offer above that floor is an offer, and an employer can in theory withdraw it, though a written request for two more weeks is almost always granted. Keep the reply in writing either way.
My package is above the ESA minimum. Is that enough?
Above the minimum is where the question starts, not where it ends. Measure the offer against the common law months for your profile and against every bonus and vesting date that falls inside those months, because the release trades all of it away. A package that beats the statutory weeks can still be months short.
Do I lose RSUs that are scheduled to vest after my last day?
Not automatically. Grants that would have vested inside the notice period are part of the loss, and Wigdor v. Facebook Canada Ltd., 2026 ONCA 572, a recent 2026 Court of Appeal decision, held that plan wording ending vesting at termination is void for the statutory notice period. Grants that would vest after the notice period ends are generally gone, so the length of the notice period decides how much equity is in play.
The letter calls this a layoff, not a termination. Does that change anything?
Under s. 56 a layoff stays temporary only while it sits inside 13 weeks in any 20 consecutive weeks, or up to 35 weeks in 52 where the employer keeps up benefit contributions or another listed condition is met. Past that the employment is terminated, and s. 56(5) dates the termination to the first day of the layoff. Without a contract term allowing a layoff, being put on one can also be a constructive dismissal at common law.
Daniel Carter
Legal Writer, Mirza Law
Daniel Carter is a legal writer at Mirza Law in Toronto. He writes about layoffs, employment contracts, and the steps to take before you sign anything from your employer.
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