After Ontario’s Declared Emergency Ends, Normal Lay-Off Rules Return
On July 24, 2020, Bill 195, Re-opening Ontario (A Flexible Response to COVID-19) Act, 2020 (the “Bill”) came into force, bringing an end to Ontario’s declared State of Emergency. Although the declared emergency is over, many emergency orders continue in effect (for an initial period of 30 days beyond July 24, 2020 and subject to subsequent renewal).
Employers and employees should be aware that the Bill has impacted a number of employment rights and obligations through its interaction with various provisions of the Ontario Employment Standards Act, 2000 (“ESA”). This includes:
Declared Emergency Leave (“DEL”): Ontario employees can only qualify for Declared Emergency Leave during an emergency declared by the province pursuant to the Emergency Management and Civil Protection Act. As the declared emergency ended effective July 24, entitlement to the DEL has also ended.
Infectious Disease Emergency Leave (“IDEL”): Early in the pandemic, the province introduced this new type of job-protected leave via ESA Regulation 228/20 (Infectious Disease Emergency Leave). The Bill does not affect an employee’s entitlement to IDEL for as long as the ESA continues to recognize COVID-19 as a designated infectious disease. As such, any employee that is unable to work as a result of medical investigation, self- isolation, quarantine, or caring for a close family member (as set out in the ESA) continues to qualify for IDEL and can remain on unpaid leave from work.
Deemed IDEL: On May 29, 2020, the Ontario government amended ESA Regulation 228/20 to deem any employee whose working hours/wages had been reduced or eliminated in response to COVID-19 to be on IDEL retroactive to March 1, 2020 (and continuing until the date 6 weeks after the declared State of Emergency is over).
In practice, this amendment has allowed employers to implement temporary wage and staff reductions without triggering a lay-off or constructive dismissal from employment (under the ESA). Rather, affected employees were instead deemed to be on a job-protected leave.
Accordingly, with the State of Emergency now over, this temporary relief for employers will end on September 4, 2020 (subject, of course, to any further statutory amendments). As a result, the standard ESA temporary lay-off rules will again apply as of that date.
Takeaway for Ontario Employees & Employers
Employees that were previously on a deemed IDEL (as a result of having their employment temporarily reduced or suspended), may be placed on a temporary lay-off as of September 5, 2020. This requires positive action be taken by the employer prior to that date. Absent an employer taking steps to either recall staff or implement an unpaid temporary lay-off (if permitted by the parties’ written agreement) a constructive dismissal may result.
That being said, the pandemic has introduced a fair degree of complexity to otherwise settled legal standards. As such, prior to asserting a constructive dismissal, employees are best advised to seek guidance from an experienced employment lawyer.
In the event an employee is placed on a temporary unpaid lay-off that lasts longer than 13 weeks (subject to certain exceptions), a deemed dismissal will result. The employee would then be eligible to receive statutory termination and severance pay (if applicable) as well as any contractual or common law entitlements.
Employers must be mindful of the re-engaged ESA lay-off timelines and track them carefully. If possible, employers may wish to consider recalling staff to work (with wage subsidy assistance as appropriate). If a recall is unrealistic, however, employers should be aware of, and plan for, the reality that staff members remaining on unpaid lay off from work for longer than prescribed by the ESA will automatically be dismissed and become entitled to receive termination payments.
The legal landscape has changed dramatically over the past five months in response to challenges presented by COVID-19. It is possible that the province may again introduce legislation to avoid business closures and protect jobs. In the advent of a new spike in COVID-19, a second government-mandated shutdown may also occur. Accordingly, employers should look to keep apprised of changing legal and business requirements and work closely with their employment counsel to navigate the shifting tides of this pandemic.
Vey Willetts LLP is an Ottawa-based employment and labour law boutique that provides timely and cost-effective legal advice to help employees and employers resolve workplace issues in Ottawa and across Ontario. To speak with an employment lawyer, contact us at: 613-238-4430 or info@vwlawyers.ca.
