As of September of this year, Calgary continued to have the second highest jobless rate in the country. Compounding matters is that, while Albertans continue to have the highest average incomes, country wide, we also carry the greatest debt loads.
While the economy has rebounded some since the oil crash of 2014, our petroleum industry has never returned to what it once was; further uncertainty with the Trans Mountain Pipeline does not add to job stability or certainty. In such uncertainty, lay-offs and their resulting severance payments are still occurring. While being laid off is difficult enough, if you are mandated to pay spousal and child support, the situation can be even more difficult. While it might seem fairly simple that if you lose your job, your support obligations should decrease, the Courts do not always see it that way. Take the recent case of Martinson v Martinson, 2018 ABCA 332, for instance. In this case, among matters at issue, was the fact that the father had lost his job with NAIT and had reported a loss of income in the amount of close to $40,000 in annual income. Notwithstanding this, the Court held that they were of the belief that the Father could earn income similar to his previous salary. Upon appeal, the Father relied upon the very well-known case of Hunt v Smolis-Hunt, 2001 ABCA 229, wherein it was held that there must be evidence that a payor is intentionally underemployed for the purposes of avoiding support obligations. Nonetheless, the Court mandated that the father continue to pay support on his pre-job-loss income until his taxes were prepared. As a result, and notwithstanding that there was no disputing that the Father had lost his job, the Court required that the Father continue paying support on a prior year’s income received for a job he no longer had.
Further, most terminated employees receive severance payment from their employers, which also factors in to support obligations and can be treated as income for support purposes, and will be considered as such by the Courts.
In order to ensure that support obligations are properly calculated there are important steps that one can take in the face of termination and receipt of a severance package.
Losing a job is never easy, but losing a job while having to pay support compounds the difficulty of the situation. However, the lawyers at Mincher Koeman are able to help you navigate such stressful circumstances. If you have lost your job and are needing to revise your support and plan for the future, give us a call at (403) 910-3000, or email us at firstname.lastname@example.org.
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