Former Future Shop employees claim severance packages inadequate
Best Buy Canada is coming under fire over severance packages former Future Shop employees say are inadequate and signed under duress.
Best Buy Canada, a subsidiary of Best Buy Co. Inc. that owns and operates both Best Buy and Future Shop stores, permanently closed 66 Future Shops on Saturday, and announced that 65 others will be converted into Best Buy locations.
The closure resulted in the loss of 500 full-time and 1,000 part-times jobs. Although the affected workers will receive severance, employee assistance, and outplacement support under the terms of an agreement employment lawyer Lior Samfiru said they felt pressured to sign.
"This was a shock to these individuals. They show up for a meeting in the morning, they think they're going to work, they find out that's it, yesterday was your last job, the store's closing and here's a severance letter, you should sign it," Samfiru told CTV’s Canada AM on Monday.
"A lot of these people understandably felt quite pressured to sign, felt that they had no choice that they're losing their job, they're offered some money they'd better sign it, not knowing in fact that they may be losing out on significant entitlements that they have. So a lot of these people, I say, may have signed under duress."
Best Buy Canada spokesperson Elliott Chun said in a statement that the company "fully complied with all provincial employment and labour standards to calculate severance for our employees."
But Samfiru said that falls short of what employees are entitled to.
"That statement is quite misleading because their legal obligations under provincial statutes are only a portion, a small fraction, of their full obligations," he said.
"What I've heard from these individuals that I've spoken with, and I've spoken with quite a few, is that they have not received proper severance ... provincial standards could be maybe a quarter, maybe a half of their full entitlement so that's not the end of the story right there."
Samfiru said there are three main factors that go into calculating severance, including the worker’s age, length of employment, and the type of job.
"The longer you work, the older you are, the more senior position; the greater the severance," he said.
"So it's not a simple calculation of saying you've worked there for two years, therefore you get two weeks. And applying that formula, that analysis, to these individuals -- they have not received proper severance. Far from it."
Samfiru said employees found out Saturday morning "in a very shocking way" that the stores were closing, which is different from the gradual rollout of layoffs Target Canada Co. announced in January.
Samifru said he is going to continue to work with former Future Shop employees to negotiate proper severance, and has not ruled out taking the matter to court.
"If we cannot, if Future Shop maintains its position, at that point we may have to consider legal action," he said. "The hope is that that doesn't have to happen."
Best Buy statement:
We took great care to ensure we looked after our people. Best Buy Canada fully complied with all Provincial Employment and Labour Standards to calculate severance for our employees.
On Saturday morning, we personally delivered the news to our people. We remain committed to assisting them through this transition including:
- Continued access to our Employee Assistance Program (EAP) Life Solutions
- Dedicated website to assist with internal question and inquiries
- In-person and online outplacement services
- Posting of employment opportunities with partner companies who are seeking large numbers of qualified employees
We chose not to ask our people to work any part of their notice period; given the scale of the change, we elected to pay them in lieu of notice.