Whether the wind down is because the owners are simply giving up the business or, like 355-year-old department store chain Hudson’s Bay, have not been able to handle its debt, the disappearance of an employer brings extra difficulties to the unemployment process.
“It’s absolutely a bit more complex,” said Sunira Chaudhri, founding lawyer at Workly Law in Toronto.
Workers might have to wade through bankruptcy or creditor protection court processes to get paid outstanding earnings or may later find they have no point person to help locate paperwork they’ll need during tax season or when applying for government assistance.
The extra layer of complexity makes it even more important for workers to plan ahead so they can recover from the job loss, say Chaudhri and other labour experts.
Gather your employment documents now
As soon as it becomes clear the company you work for is winding down and taking your job with it, it’s time to start collecting documentation, like records of employment, T4s and contracts or letters describing your pay, commission and vacation, said Neena Gupta, a Waterloo, Ont.-based partner at Gowling WLG.
“One of the shocking things that happens is sometimes the systems you rely upon to retrieve your paycheque, find out how much vacation pay you have, determine whether you have a bonus coming to you, calculating your commission—you stop having access to those systems,” she said.
If you have documents detailing what you’re entitled to, Gupta said, “you can establish with some confidence what your employer owes you.”
If there is a gap between what you’re owed and what you’re offered in severance or an exit package, a lawyer, your union or—if your company filed for creditor protection or bankruptcy—the court-appointed trustee or monitor can offer paths forward.
