COVID-19 and Employment Law Issues in Ontario Arising from the Pandemic


Background:

A lot of employment lawyers and businesses have been wondering what the Government of Ontario is doing about the (hopefully) temporary, but indefinite, work reductions that have afflicted so many employees, so as to avoid those workers being terminated automatically by virtue of laws limiting temporary layoffs.  The Employment Standards Act, 2000 (“ESA”) would normally cause temporary layoffs to become permanent, for many employees after 13 weeks in duration (or 35 weeks if certain benefits or proscribed payments are continued by the employer). 

A lot of debate has happened about wage cuts too, and what legal claims they could create for employees who may suffer them on a temporary or indefinite basis, given constructive dismissal principles that exist.  I have written about that here.

The latest updates to Ontario employment law, as of May 29, 2020, put some of these questions to rest but will create many new questions too.  I try to answer some below.

Here’s the background:

On May 29, 2020, Ontario Regulation 228/20 (“the Regulation”) was passed under the Employment Standards Act, 2000 (“ESA”). 

The Regulation’s key provisions only affect non-unionized employees. 

Most employees whose hours of work or wages have been temporarily reduced or eliminated by the employer for reasons related to COVID-19 are now exempt from ESA layoff provisions and shall not be considered to be laid off under the ESA, unless they were laid off due to a permanent shutdown of the employer’s entire business.

A couple big takeaways from the new ESA Regulation are:
  • the layoffs of non-unionized employees will not result in deemed termination of employment during the COVID-19 period for most employees even if the work reduction continues for a long period of time (i.e. beyond 13 or 35 weeks).
  • the temporary reduction of hours or wages of non-unionized employees during the COVID-19 period will not result in constructive dismissal for most employees either – at least under the ESA.
The “COVID-19 period” is defined as the period beginning March 1, 2020 and ending on the date that is six (6) weeks after the current Declaration of Emergency in Ontario is terminated or disallowed.  


 
Wesley Jamieson
Wesley Jamieson
P: 905.572.5806
wjamieson@rossmcbride.com