Ann Sanders worked for Bowring & Co. Inc. for 21 years. When she was let go in January, she walked away with nothing but her wages and vacation pay.

Bowring and Bombay & Co. Inc. had restructured after filing for creditor protection in August, ultimately closing 50 out of 112 stores and letting go of 164 employees.

Sanders received no termination package, and after consulting with a lawyer, she felt she had no reasonable prospect of getting one.

Today, Bowring stores still sell housewares and Bombay stores still sell furniture. Sanders, though, is reluctantly retired.

“I received no notice or severance. I was just terminated,” said Sanders, 74, who worked part-time, full-time and as an assistant manager during her long tenure at Bowring.

“I feel I devoted a lot of time and effort to this company over the years. That’s what hurts more than anything.”

Sanders is one of the tens of thousands of retail workers in Canada left jobless by the series of closures, bankruptcies and insolvencies that have hit the sector over the past year.

Target Canada, which filed for creditor protection in January, serving notice that it would close 133 stores and put 17,600 people out of work, was simply the largest. Another 1,500 full- and part-time jobs were lost when Best Buy shuttered the Future Shop chain in Canada.

The Jones Group Inc. is closing 36 stores; Mexx closed 95; Jacob Inc. closed 92.

Comark Inc., with 300 stores in Canada operating under three banners — cleo, Ricki’s and Bootlegger — announced in March that it had obtained creditor protection under the Companies’ Creditors Arrangement Act (CCAA).

Some terminated employees find themselves in a better situation than others. Target Corp. provided a $90 million fund to pay staff; Future Shop workers received pay in lieu of notice, getting money they would have earned during an expected layoff notification period.

But more often than not, employees of a company that seeks creditor protection or goes into bankruptcy are unsecured creditors. They must line up behind banks and other companies that make being a secured creditor a condition of doing business.

It’s upsetting to Sanders that Fred Benitah, the owner of the Bowring and Bombay stores, was able to buy the company back for $1 million in cash and an agreement to assume all secured debt, including $19 million owed to CIBC; $8 million owed a company called F.B.I., which Benitah also owns, and $20 million to a company called Isaac Bennet Sales Agencies Inc. (IBSA), owned by Benitah’s brother, Isaac Benitah.

“The evidence was put before the courts; it was the best outcome in not a great situation,” said Ira Smith, of Ira Smith Trustee & Receiver Inc., who reviewed the case for the Star. Fred Benitah could not be reached for comment; lawyers for Isaac Benitah relayed a message saying they would not comment.

Should employees be treated as secured creditors? One of Canada’s top labour and employment lawyers says there are no easy answers when it comes to balancing the rights of employees and businesses.

“This is a big economic question. How much do you want to punish a company economically, because if you overdo it, companies will not do business in Ontario because the level of liability is too high,” said Brian Grosman, a pre-eminent labour and employment lawyer, and co-founder of the employment and labour law firm Levitt & Grosman LLP.

“Meanwhile, employees are saying: ‘I’m getting shafted’, and to a certain extent, they’re right.”

A positive development in the years Grosman has been in practice has been the erosion of the stigma associated with losing a job. “Today, there is no stigma to being let go because the economy is going up and down like a yo-yo. You can be fired for reasons that have nothing to do with your competency,” said Grosman.

Unionized employees have more protection than those who are not unionized, said Barry Sawyer, executive assistant to the national president of the United Food and Commercial Workers Union.

“Could I look you in the eye and say that everyone in a collective agreement will get severance? No. But it’s definitely the strongest leg you have to stand on in terms of severance pay,” said Sawyer.

“Those who don’t have a collective bargaining agreement, all they have is the Employment Standards Act. Yes, it does tell you what pay or pay in lieu of notice should be, but if the employer doesn’t live up to it, you have to follow up yourself.”

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When employees do have a claim against a retailer, pursuing it can be an expensive legal endeavour, making it uneconomical for someone who is owed less than $5,000 or even $10,000.

It does help to have leverage, Grosman said. Many companies would rather pay employees severance than risk the negative publicity associated with leaving them in the lurch, or the cost of being taken to court

In Ontario, employers can terminate without providing a reason, but must provide reasonable notice, and the definition of reasonable notice is not always cut and dried, said employment lawyer Andrew Monkhouse. It differs according to the person being terminated, the job and the situation.

“A reasonable amount is how long it would take someone in your specific situation to find a job,” said Monkhouse.

A long-serving employee might get between 18 and 22 months’ notice. Someone who has been working for one day could be eligible for six months.

Under the Employment Standards Act, people who are fired are entitled to one week of notice of termination per year of service, or pay-in-lieu of notice, up to eight weeks. Employees with five years or more of service and who work for a company with a payroll of more than $2.5 million get an extra week of pay a year, up to 26 weeks.

It’s been established in law that pay-in-lieu can climb much higher — up to a month for each year of service or more, depending on the person’s age, job and chance of obtaining similar work, said Jeff Hopkins of Grosman, Grosman & Gale LLP.

Directors of a company are personally liable for employee wages and vacation pay, so those are typically paid even in a bankruptcy, said Hopkins.

“It’s typically the severance where they are left out in the cold.”

Succession rights have also been established in law. When one company takes over another, similar business, the new company can be held responsible for the employees of the old business.

The UFCW union took Target to the labour relations board in B.C. when it wouldn’t keep on Zellers employees. That suit failed.

Some jobs come with employment contracts that limit the right of employees to get more than a minimum of severance, which is why it’s important to have an employment contract reviewed by a lawyer before signing, said Monkhouse.

The problem is, while employers are in a position to do checks on employees, employees don’t engage in the same process to ensure that the company they’re going to work for has a strong balance sheet.

“Employees don’t do credit checks on employers,” said Monkhouse.

Correction – April 7, 2015: This article was edited from a previous version that misspelled Ann Sanders’ surname.