Samfiru Tumarkin LLP launches $130M class action against Shopify for breach of contract on severance pay

OTTAWA, ON, May 30, 2023 /CNW/ - Samfiru Tumarkin LLP, Canada's largest employee-focused employment law firm, has initiated a $130-million class action lawsuit against global e-commerce giant Shopify, following allegations of the company's illegal attempt to slash severance packages after a nationwide mass layoff.

On May 4, Shopify CEO Tobi Lutke announced a significant reduction in the workforce, resulting in the termination of 23% of its employees. Shopify initially assured the affected employees of generous severance packages, which many accepted. However, to the shock and disappointment of those impacted, Shopify advised employees that, despite accepting a severance package, the company would not honour the agreed-upon terms. The company then presented outgoing staff with a second severance offer, substantially reducing the agreed-upon severance amounts, often by tens of thousands of dollars.

Lior Samfiru, employment lawyer and national co-managing partner at Samfiru Tumarkin LLP, expressed his disbelief at Shopify's actions, stating, "In my over two decades as an employment lawyer, I have never witnessed an employer renege on accepted severance agreements in this manner, particularly during times of economic uncertainty. Shopify's conduct not only breaches the contracts it established with its employees, but it also demonstrates a disregard for fairness."

Iain Russell, the lead plaintiff in the class action, who dedicated over seven years to Shopify, was one of the 2,000 employees unexpectedly impacted by the company's downsizing. After accepting an initial severance package that appeared to meet Shopify's legal obligations, Russell was later informed that the company would not abide by the terms he accepted. Instead, he was instructed to agree to a second offer with a potential reduction of more than $50,000.

"Shopify made severance offers to these employees, threatened them with a short and arbitrary acceptance deadline, and when the employees accepted the offers, they were advised that they had no choice but to accept a significantly lower amount," said Samfiru.

"It appears that Shopify took deliberate action to minimize its financial liability, resulting in considerable losses for potentially thousands of people."

Who is included in this class action?

An individual will automatically be a member of this class action if the following factors are met:

• They worked for Shopify anywhere in Canada.
• They lost their job as part of the 23% layoff on or about May 4, 2023.
• They accepted (or attempted to sign and were denied the opportunity to do so) their initial severance offer from Shopify.
• They were asked to accept a second severance package that provided less compensation than the initial offer.

For more information about the class action against Shopify, please visit shopifylawsuit.ca.

About Samfiru Tumarkin LLP

Samfiru Tumarkin LLP is Canada's largest plaintiff-side employment law firm, focusing on severance pay, wrongful dismissal, long-term disability claim denials, constructive dismissal, employee misclassification, human rights, temporary layoffs, and employment contracts. It has represented clients in groundbreaking cases against Uber, HBC, Sun Life, TD Insurance and the Ministry of Labour.

The firm represents both employees and employers across Ontario, Alberta and B.C., as well as individuals across Canada (excluding Quebec) who have been denied long-term disability benefits by their insurance providers. Millions of people have used their Pocket Employment Lawyer and Severance Pay Calculator to gain a better understanding of their rights in the workplace and when facing job loss.

In addition to being the most quoted authority on employment law in Canada, Samfiru Tumarkin LLP has successfully represented tens of thousands of clients and is the most positively reviewed law firm in the country (on Google).

Samfiru Tumarkin LLP is widely recognized as a trusted authority on employment law in Canada, highly sought after by media for expert insights. With a track record of successfully representing tens of thousands of clients, the firm has established an exceptional reputation as one of the highest-rated law firms in the country (on Google).

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SOURCE Samfiru Tumarkin LLP

or media inquiries: Ryan Bonnar, Media Relations Manager, Samfiru Tumarkin LLP, [email protected], 416-216-5893