Do I Get Severance if I Retire or Resign in Ontario?
If you genuinely retire or resign, there is usually no severance. But if you were pushed into it, the law may treat it as a dismissal, and that changes everything.
Key takeaways
- A genuine retirement or resignation usually means no severance.
- A forced or pressured exit can be a constructive dismissal with full severance.
- Mandatory retirement is generally not allowed in Ontario.
- Being pushed out for your age can also be age discrimination.
- How your exit is characterized decides whether you are owed anything.
In this article
Whether you are owed severance when you leave often comes down to one question: did you really choose to go? A true retirement or resignation generally ends your severance rights, because you, not the employer, ended the job. But if you were nudged, pressured, or effectively forced out, the law may see a dismissal, and then the picture is very different. Here is how to tell.
✅Quick answer. If you genuinely retire or resign, you usually are not owed severance, because you chose to end the employment. But if the retirement or resignation was forced or pressured, for example your employer made your job intolerable, cut your pay, or told you to retire, the law can treat it as a constructive or wrongful dismissal, which entitles you to severance. Mandatory retirement is generally prohibited in Ontario, and pushing someone out because of age can be age discrimination. The label on your departure does not control the outcome, the reality does.
Genuine retirement or resignation: usually no severance
Severance compensates you for being let go without adequate notice. If you voluntarily retire or resign, there was no dismissal to compensate, so there is generally no severance, though you are still owed any earned wages, vacation pay, and vested entitlements. A real, freely-chosen exit closes the door on a severance claim.
When a resignation or retirement is really a dismissal
The exception is where your hand was forced. If your employer created intolerable conditions, cut your pay or hours, demoted you, or made clear you had to go, your resignation may be a constructive dismissal, and your retirement may be no more voluntary than a firing. In that case you can be entitled to full severance despite having submitted a resignation or retirement notice. What matters is whether a reasonable person would have felt they had no real choice.
Mandatory retirement and age discrimination
Ontario generally does not allow mandatory retirement. An employer cannot force you out simply because you reached a certain age, and doing so can be both a wrongful dismissal and age discrimination under the Human Rights Code. If you are being pressured to retire, or treated as if there is an expiry date on your job because of your age, that is a red flag worth acting on rather than accepting.
What should you do before you retire or resign?
- 1.Ask yourself honestly whether the choice is truly voluntary or pressured.
- 2.Do not sign a retirement or resignation letter under pressure without advice.
- 3.Note any pay cuts, demotions, or comments about your age that preceded the decision.
- 4.If you feel pushed out, get a severance review before you formalize your exit.
The safest move when a departure does not feel fully voluntary is to get advice before you put anything in writing. See forced resignation and constructive dismissal and taking back a resignation, and for the bigger picture, severance pay in Ontario.
Frequently asked questions
Do I get severance if I resign in Ontario?
Usually not, if the resignation is genuine and voluntary, because you ended the employment. You are still owed earned wages and vacation pay. But a forced or pressured resignation can be a constructive dismissal that entitles you to severance.
Do I get severance if I retire?
A genuine, freely-chosen retirement usually means no severance. But if you were pushed or pressured to retire, the law can treat it as a dismissal, and mandatory retirement is generally not allowed in Ontario.
Can my employer force me to retire at a certain age?
Generally no. Mandatory retirement is largely prohibited in Ontario, and forcing you out because of your age can be both a wrongful dismissal and age discrimination under the Human Rights Code.
I resigned because the job became unbearable. Am I owed anything?
Possibly. If your employer made conditions intolerable or effectively forced you out, your resignation may be a constructive dismissal, which entitles you to severance despite the resignation letter. It is worth having reviewed.
Priya Sharma
Legal Writer, Mirza Law
Priya Sharma is a legal writer at Mirza Law in Toronto. She writes about wrongful dismissal, workplace rights, and what Ontario employees can do when they are treated unfairly.
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