September 17, 2021
by Israel Foulon LLP

The Deemed IDEL Period Extended to January 1, 2022

The COVID-19 Period under the temporary amendments to Employment Standards Act, 2000 (“the ESA”) previously scheduled to end on September 25, 2021, has been extended to January 1, 2022. Paid infectious disease emergency leave was originally set to end September 25, 2021. It will now continue until December 31, 2021.

The Infectious Disease Emergency Leave 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.

The ESA’s regular rules around constructive dismissal and temporary layoffs will resume on January 2, 2022, unless the government further extends the leave (as it has previously done on several occasions). For practical purposes, this means that an employee’s ESA temporary layoff clock will start to run unless the employee is recalled to work effective on or before January 1, 2022.

Standard Temporary Layoff Rules

Ordinarily, in Ontario, where the employment contract permits (or the employee agrees in writing), an employer may place an individual on a temporary layoff for 13 weeks or less in any 20-week period. However, this may be extended for up to 35 weeks or less in any 52-week period, where the employer maintains the employee’s full suite of benefits during the temporary layoff, among other exceptions. As outlined above, in the event that an employee is not recalled to work within the specified periods, they are deemed to be terminated under the ESA and are entitled to payment in lieu of notice, and severance if applicable.

Constructive Dismissals

A constructive dismissal occurs where an employer makes a unilateral change to a key term of the employment relationship without the employee’s consent. As of January 2, 2022, under the ESA, this may include where, an employer reduces an employee’s hours of work or remuneration without seeking their express written consent to do so. Additionally, an employee may also be constructively dismissed where the employer places them on a temporary layoff absent the express contractual right to do so. In such circumstances, it is possible that employees who were placed on IDEL and who have not been recalled to work as of January 2, 2022 will take the position that they have now been constructively dismissed. A finding that an employee has been constructively dismissed may result in a significant notice payment, especially in the case of long service employees.

Importantly, as explained in previous E-Bulletins, there remains uncertainty as to the effect of the temporary deemed IDEL under the Employment Standards Act, 2000 and common law constructive dismissal claims. To date, there have been conflicting decisions on this issue, and we expect that appellate courts will release decisions on this topic in the coming months.

We recommend that you seek legal advice if you have concerns about how to manage your business and your workforce, before the end of the COVID-19 Period.

Israel Foulon Wong’s Response to COVID-19

Israel Foulon Wong LLP 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.