December 18, 2020by Israel Foulon LLP
On December 17, 2020, the provincial government passed O. Reg 765/20. The regulation amends the temporary COVID-19 relief measures under the Employment Standards Act (“the ESA” or “the Act”), extending the COVID-19 Period to July 3, 2021. The extension affects constructive dismissals, temporary layoffs and the deemed termination provisions for non-unionized employees under the Act.
COVID-19 Period Extended to July 3, 2021
On December 17, 2020, the provincial government announced that it was amending Ont. Reg. 228/20 under the ESA. The amendment extends the COVID-19 Period, previously scheduled to end on January 2, 2021 until July 3, 2021.
The regulation addresses temporary changes to the employment relationship that have occurred as a result of COVID-19 and alters the temporary layoff and constructive dismissal provisions under the ESA. During the COVID-19 Period:
- Where an employer is forced to temporarily reduce or eliminate an employee’s hours of work or wages, the employee is deemed to be on Infectious Disease Emergency Leave (IDEL), a job-protected leave, and is not considered to be on a temporary layoff under the ESA; and
- Temporary reductions in wages or hours worked, for reasons related to COVID-19, are deemed not to be a constructive dismissal under the ESA.
You can access the Ontario government’s newsroom announcement regarding the extension HERE.
Special Industry Legislation to Support the Hospitality and Tourism Industry
On December 17, 2020, the provincial government also announced plans to table legislation that would support unionized employers in hardest-hit industries including hospitality and tourism. If passed, the proposed legislation would permit employers to negotiate alternative arrangements with unions for placing termination and severance pay for laid-off employees into a trust. With the union’s consent, employers would then have the option of using part or all of the trust funds to maintain the business.
Takeaway for Employers
The extension of the COVID-19 Period continues to stop the clock from running on the deemed termination provisions located at s. 56(2)(a) of the ESA. The ESA’s regular rules around constructive dismissal and temporary layoffs will resume on July 4, 2021.
For practical purposes, this means that an employee’s ESA temporary layoff clock will not start to run unless the employee is still not recalled to work as of July 4, 2021. At that point, employees not recalled to work would be transferred from IDEL to temporary layoff. Such employees would then be deemed to be terminated under the ESA if they are not recalled to work within 13 weeks from July 4, 2021 (if no benefit continuation is in place) or 35 weeks from July 4, 2021 (if benefit continuation is in place).
Additionally, it also means that temporary changes to an employee’s compensation or hours of work made between now and July 3, 2021, will not result in a constructive dismissal under the ESA. However, changes to the employment relationship cannot be made on a frivolous basis and must arise due to circumstances related to the COVID-19 pandemic. Moreover, it is presently unclear whether the temporary amendments to the ESA prevent employees from raising a constructive dismissal claim at common law.
We recommend that you seek legal advice if you have concerns about how to navigate these issues.
Israel Foulon’s Response to COVID-19
Israel Foulon is assessing the situation as it evolves, and is taking all necessary precautions within its workplace. To slow the spread of COVID-19 and for the health of our team and clients, absent extraordinary circumstances we are working remotely until further notice whenever possible. However, please be aware that our offices remain open and are fully functioning. In the circumstances, we encourage our clients to contact us by phone and email to the extent possible. Voicemail messages left at our office phone numbers are immediately forwarded via email. All messages will be promptly responded to. We remain steadfast in our commitment to our clients and would be more than happy to assist you with concerns regarding COVID-19 or any other employment or labour matters.
Israel Foulon LLP is one of Canada’s leading employment and labour law firms. The firm’s partners, Peter Israel, Chris Foulon, and Carita Wong, and their associates, Krista Kais-Prial, Behzad Hassibi, and Daniel Hunter have among them over 80 years of experience in assisting clients with employment and labour law issues.
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LEGAL DISCLAIMER: This update is for informational purposes only and is not intended to provide legal advice, which in all circumstances must be tailored to the specific facts of any problem. You should obtain a proper legal consultation in order to determine how the above applies to your situation. Please feel free to contact us to learn more.