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Severance Pay vs Termination Pay in Lieu of Notice: What’s the Difference?

In British Columbia, “severance pay” and “termination pay in lieu of notice” are often used as if they mean the same thing. They do not. Each has a different legal meaning and obligation.

The confusion usually starts at termination. Employers may describe all payments as “severance” or combine multiple amounts into a single lump sum. When this happens, it becomes difficult to understand what is actually being paid within a broader dismissal and severance framework.

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