For many Employers across Ontario who were forced to temporarily lay off their staff in March 2020, the fact that it was soon going to be thirteen weeks since they had laid off their staff was a significant source of concern. The reason: at thirteen weeks many employers would have reached the temporary lay-off deadline by which they would have to either recall their staff to work or they would be considered to have terminated their employee’s employment and triggered their obligation to provide notice of termination and severance pay (of any).
For many employers, having to pay out significant notice/severance obligations presented a real prospect of financial ruin. Even if the business was able to survive financially, it would mean having to permanently terminate their staff, a decision that many employers have been working hard to avoid not only because of the financial implications but because successful business owners recognize that having the right staff and building the right team is key to success. .
On June 1, 2020, in recognition of these concerns, and echoing the decisions of other provinces like Manitoba and New Brunswick, the Ontario government announced new regulatory changes to the Employment Standards Act which will mean that employers will not be forced to permanently lay off employees due to COVID-19.
There are three significant changes that are brought by this legislation:
- Rather than be forced to terminate their employees in accordance with the set time frames set out in the temporary layoff section 56 of the Employment Standards Act, employees who have had their hours reduced or eliminated because of the pandemic will be deemed to be on Infectious Disease Emergency Leave (IDEL). Workers on IDEL will remain employed with legal protections and be eligible for federal emergency income support programs. The IDEL period is deemed to have been running from March 1, 2020 and it will end six weeks after the Emergency Management and Civil Protection Act is terminated or disallowed.
- The Regulations also specifically eliminates the risk of claims of constructive dismissal as a result of temporary lay offs that we had raised in our blog in March on Temporary Lay Offs and COVID by expressly providing that a reduction in hours or wages is not a constructive dismissal.
- In order to avoid the time and expense of addressing any Ministry of Labour complaints that have already been filed on this issue, the legislation stipulates that a complaint that was filed with the Ministry regarding a temporary reduction or elimination of hours as a result of COVID-19 will be deemed not to have been filed at all.