A manual for legal experts to help interpret the Employment Standards Act, 2000, the Employment Protection for Foreign Nationals Act and their regulations.
The Employment Standards Act, 2000 Policy and Interpretation Manual content is subject to change without notice. The Ministry of Labour, Immigration, Training and Skills Development makes no warranty, express or implied, about the currency, accuracy or completeness of the Manual. It cannot be reproduced. It is not intended to replace the Employment Standards Act, 2000 (ESA 2000), the Employment Protection for Foreign Nationals Act, 2009 (EPFNA), or regulations made pursuant to those acts. Reference should always be made to the official version of the legislation. For complete and current information, please refer to the ESA 2000, EPFNA and regulations thereto found on the Government of Ontario's e-Laws website.
Welcome to the Employment Standards Act, 2000 Policy and Interpretation Manual ("the Manual"). This Manual is the primary reference source of the policies of the Director of Employment Standards respecting the interpretation, administration and enforcement of the Employment Standards Act, 2000, SO 2000, c 41 ("ESA 2000") as well as the Employment Protection for Foreign Nationals Act, 2009, SO 2009, c 32 ("EPFNA"). The EPFNA incorporates by cross-reference many provisions of the ESA 2000 and, like the ESA 2000, is administered and enforced by the Employment Standards Program of the Ministry of Labour, Immigration, Training and Skills Development .
The ESA 2000 was established by Bill 147 and proclaimed into force as of September 4, 2001. The ESA 2000 repeals and replaces the former Employment Standards Act, RSO 1990, c E.14 ("the former Act") and several other related employment law statutes. This is the first comprehensive overhaul of Ontario's employment standards legislation in more than two decades. While most of the employment standards under the former Act are contained in the ESA 2000, the wording of most of the provisions has been revised, and numerous administrative and housekeeping alterations have also been made. Further, there are several significant, substantive changes as between the former Act and the ESA 2000.
The EPFNA applies to foreign nationals who are employed or attempting to find employment in Ontario pursuant to an immigration or foreign temporary employee program. Among other rights and protections afforded under the EPFNA , the EPFNA prohibits recruiters from charging fees for any goods, services or benefits provided in connection with finding employment for these foreign nationals. Employers are also prohibited from recovering any costs from such foreign nationals that were incurred in connection with arranging to employ the individual, unless permitted by regulation.
The policies contained in this Manual are intended primarily for the use of employment standards officers and persons within the Ministry of Labour, Immigration, Training and Skills Development administering the ESA 2000 as well as the EPFNA . The policies contained in the Manual have been developed with the input of Employment Standards Program staff. We are interested in ensuring that both the ESA 2000 and the EPFNA are applied in a consistent manner throughout the province and the Manual is designed to facilitate that objective. These policies may be revised as case law develops and interpretations evolve. Policy revisions are included in the Manual updates.
The Manual is organized by legislation and regulation: firstly, the ESA 2000 and regulations thereto, and then EPFNA and regulations thereto. The ESA 2000 is broken down by part and then by section. The EPFNA is broken down by section.
The Manual contains numerous references to decisions under the ESA 2000 of the Ontario Labour Relations Board ("the Board"). There are also references to the decisions of referees and adjudicators who had jurisdiction to hear reviews under the former Act prior to the jurisdiction being transferred to the Board on June 29, 1998. While these decisions were issued under the former Act, they are included in the Manual because the principles enunciated in the decisions remain relevant under the Employment Standards Act, 2000. The Board also has jurisdiction to hear reviews under the EPFNA and as decisions are issued under the EPFNA , these will also be cited when the Program considers it appropriate to do so.
It is important to note that these decisions may not necessarily reflect Program policy on a particular point. Where a decision in the Manual is not in accordance with our policy, this is usually noted in the Manual. Employment standards officers are required to follow the policies established by the Director of Employment Standards.
The ESA 2000 and the EPFNA are both administered by the Ontario Ministry of Labour, Immigration, Training and Skills Development 's Employment Standards Program.
This decentralized Program consists of the Employment Practices Branch ("EPB"), located in the Ministry's main office, and six regional operating areas. The directors of the six regions and the EPB report to the Fair, Safety and Healthy Workplaces Division.
Each region has several Managers who are responsible for planning and giving direction for program delivery. The regions also have Regional Program Coordinators who provide program support.
The EPB has a Provincial Coordinator who is responsible for overall program coordination, and several Provincial Specialists who provide information, support and advice to the field operations; liaise with and provide support to the field and the Ontario Labour Relations Board with respect to the review process; and are responsible for the writing and updating of this Manual.
The Employment Standards Program Advisory Committee, which comprises individuals from each of the regions and the EPB, provides advice and recommendations to the Director of Employment Standards, who sets Program policy direction.
In this decentralized model, many of the statutory powers and duties of the Director of Employment Standards have been delegated to the regional operations. Note that a listing of these powers and the persons to whom they have been delegated under the ESA 2000 is contained in the Delegation of Powers section.
The following lists the powers and duties of the Director of Employment Standards in the sequence that they appear in the Employment Standards Act, 2000 and indicates to whom the powers or duties have been delegated.
The following lists the powers and duties of the Director of Employment Standards in the sequence that they appear in the Employment Protection for Foreign Nationals Act, 2009 ("EPFNA") and indicates to whom the powers or duties have been delegated. Note that most of the powers and duties of the DES under the EPFNA are incorporated by reference to provisions in the ESA 2000, which appear in square brackets below where applicable.
The discussion of the various provisions under which the Director or their delegate has authority to exercise discretion frequently contains a list of factors that may be relevant when the discretion is being exercised, and may set out general principles that are usually followed. Please note that the lists are not intended to be exhaustive of all factors that may be relevant. Please also note that Program policy is that the Director (or delegate) will consider any submissions from a party as to why a listed factor should or should not be relevant, or why a general policy should or should not be departed from.
This section of the Policy and Interpretation Manual sets out the Employment Standards Program’s policies about ESA termination and severance liabilities where an employee is not vaccinated against COVID‑19 or tested for COVID‑19 in accordance with the employer’s policy.
Note:
The ESA does not prohibit employers from terminating employees for failing to get vaccinated against and/or tested for COVID‑19. With respect to the ESA’s termination notice/pay and/or severance pay requirements, if an employer terminates an employee for this reason, it is Program policy that:
An employer is not prohibited from terminating an employee under the ESA because the employee isn’t vaccinated, refuses to be vaccinated, and/or refuses to be tested
Employees who are terminated because they are not vaccinated and/or not tested may or may not be entitled to termination and/or severance pay under the ESA – it depends on the circumstances
Scenario 1: An employer gave an employee a written ultimatum providing that the employee had until a specified date to get vaccinated and stating that the employee would be terminated if not vaccinated by that date. The employee was not vaccinated by the specified date and was terminated. The employee files a claim for termination pay.
Question: Does written notice from the employer that the employee will be terminated on a particular day if the employee is not vaccinated count towards the ESA’s required notice period?
Answer: Yes, so long as:
As set out in the discussion of s. 56 of the ESA, it is Program policy, as per the Wronko decision of the Court of Appeal, that written notice that is conditional on the employee’s acceptance of a change of a term and condition of employment can constitute notice for the purposes of the ESA, so long as it clear that a refusal to accept the change on that date will end the employment relationship. (This is to be distinguished from written notice that is conditional on an event occurring – which does not constitute notice for the purposes of the ESA. An example of this is where the employer tells an employee that the employee’s employment will be terminated if the employer does not win a contract. For further information, please refer to the discussion under ss. 56(1) of the P&I Manual.
As such, if an employer provides clear written notice that employees who refuse to accept the terms of a vaccination policy by getting vaccinated by a specified date will be terminated (and satisfies the s. 60 requirements that apply during the notice period), the notice counts towards the employer’s ESA notice of termination obligations. (Severance pay may still be owing to eligible employees. However, see Scenario 2.)
Scenario 2: An employee was terminated because the employee did not comply with the employer’s vaccination or testing policy. The employee files a claim for termination and/or severance pay.
Question: Does the wilful disobedience exemption to the termination and severance pay obligations apply?
Answer: Consistent with the Program’s policy regarding the application of the wilful disobedience exemption, the exemption may apply.
Note: the answer below applies equally to the situation where the employee was terminated because the employee did not comply with the employer’s policy that required the employee to get tested for COVID‑19. This is the case whether the policy requires the employee to either be vaccinated or get tested, both vaccinated and tested, or only get tested.
The criteria that the Program applies when determining whether the wilful disobedience exemption in O. Reg. 288/01, ss. 2(1), para. 3 and ss. 9(1), para. 6, apply are set out in the discussion of O. Reg. 288/01, ss. 2(1), para. 3.
The criteria, and their applicability to the scenario of termination because of non-compliance with an employer’s requirement to be vaccinated, are:
Although an employee who objects to being vaccinated for religious reasons may believe that the employer is contravening the Human Rights Code when requiring the employee to be vaccinated, the ES Program does not take Human Rights Code reasons into account when assessing under this criterion. Whether the employer’s rule or its application (e.g., whether the employer met its duty under the Code to accommodate) contravenes the Code is not a matter for the ES Program. An employee who is terminated and who objects to the vaccine for religious reasons may have a remedy through the Human Rights Code.
“Wilful”
Note:
Scenario: An employer imposed any of these vaccination policies:
The employee resigned in response to the policy within a reasonable period. The employee files an ESA claim for termination and/or severance pay, asserting that the policy constituted a constructive dismissal.
Question: Does the imposition of any of those vaccine policies constitute a constructive dismissal?
Answer: It will depend on the facts.
Note also that – as described earlier in Scenario 1 above – the employer may satisfy its ESA notice of termination obligations, rendering the constructive dismissal issue moot, if it provides notice in writing clearly indicating that it will be changing the employment contract at a future specified date by adopting this type of policy and it is clear that the employment relationship will end if the employee does not adhere to the policy - and satisfies the s. 60 requirements during the statutory notice period. In this case the employer is considered by the Program to have effectively provided notice of termination with an offer of re-employment on new terms and conditions.
The following criteria must be met to establish a constructive dismissal as a result of a change to the employment contract:
With respect to the first criterion, terms and conditions of employment may be implicit or explicit.
If the employment contract contains an explicit right for the employer to implement the policy at issue, the first criterion will not be met and as such the implementation of a mandatory COVID‑19 vaccine / testing policy would not be done “unilaterally” so as to form the foundation for a constructive dismissal claim.
As the vast majority of employment contracts do not contain an express provision granting the employer the right to impose such a policy, the key issue will be whether there is an implied term.
The Occupational Health and Safety Act requires an employer to take every precaution reasonable in the circumstances to protect a worker (s. 25(2)(h)). This includes not only the employee but other employees with whom they come in contact.
Whether this general duty creates an implied right to impose a vaccination / testing policy will be determined on a case-by-case basis. For example, in a workplace where there has been a history of outbreaks, where employees have to work in close proximity, or the consequences of an outbreak are high (e.g. a long-term care home), it may be that there is an implied right to impose a vaccination / testing policy. Conversely, in a workplace where there have been no COVID cases and employees can be socially distanced or work outside, it may be that there is no implied right to impose a vaccination / testing policy.
ES Program staff are asked to contact the Employment Practices Branch for assistance when investigating claims from employees who claim constructive dismissal on the basis of a vaccination / testing policy.
(Note: Although the rules that apply during the COVID‑19 period also provide that non-unionized employees whose hours are temporarily reduced or temporarily eliminated for reasons related to COVID‑19 are deemed to be on unpaid IDEL, it is ES Program policy that the employee is entitled to “regular” paid and unpaid IDEL if the reason for the reduction/elimination is the employer’s concern that the employee may expose others in the workplace to COVID‑19. Note, however, that in this situation the rules in Reg. 228/20 about ESA layoffs and constructive dismissal still apply even if the employee is on “regular” IDEL rather than “deemed” IDEL.)
The definition provides that agent
includes trade unions that represent employees in collective bargaining. Trade union is also defined in s. 1. Because the definition of agent is inclusive, rather than exhaustive, agent can include people or entities other than a trade union. For example, it can include lawyers or other representatives.
This definition was introduced by the Government Efficiency Act, 2002, SO 2002, c 18, effective November 26, 2002.
The definition provides that alternative vacation entitlement year
is a recurring 12-month period that begins on a date that is not the date of an employee’s first day of employment.
For further details see ESA Part XI - Vacation with Pay.
This definition provides that arbitrator
includes both a board of arbitration and the Ontario Labour Relations Board when it is acting under s. 133 of the Labour Relations Act, 1995, SO 1995, c 1, Sch A - that is, when it sits as a board of arbitration hearing construction industry grievances. See the definition of “board” in this section.
An assignment employee is defined as an employee who is employed by a temporary help agency for the purpose of being assigned to perform work on a temporary basis for clients of the agency. Note that ESA Part I, s. 1 also provides a definition of employee that is discussed below. The Program’s position is that work on a temporary basis
would obviously include a short term assignment but would also include long term or open ended placements with a client. The work is considered to be temporary because there is no permanent placement with the client; the assignment employee continues to be the employee of the agency and not the client throughout the period of the assignment.
Further, an assignment employee continues to be employed by the agency during both periods of assignment and non-assignment unless the relationship is ended by either party or by a lay-off that exceeds a certain number of weeks. See the related discussions in ESA Part XVIII.1, s. 74.3 and ESA Part XVIII.1, s. 74.4 regarding the employment relationship between assignment employees and temporary help agencies and work assignments as well as ESA Part XVIII.1, s. 74.11 regarding termination and severance of employment.
It should also be noted that pursuant to s. 74.8(4) and s. 74.9(4), references to assignment employee within ss. 74.8 and 74.9 are interpreted as including a prospective assignment employee
. See the discussion at ESA Part XVIII.1, s. 74.8(4).
This definition provides that benefit plan
means a benefit plan that is provided for an employee by or through the employee’s employer. Thus, both employer-sponsored plans and plans that are provided through an employer by a third-party insurer fall within the definition of benefit plan.
This defines the Ontario Labour Relations Board as the Board referred to in the Act. The definition was originally added to the former Employment Standards Act by the Economic Development and Workplace Democracy Act, 1998, SO 1998, c 8, effective June 29, 1998, at the same time the Board was given jurisdiction to deal with applications for review.
This definition identifies the kinds of services included in the term building services
. The term building services appears in ESA Part IV Continuity of Employment and ESA Part XIX Building Services Providers.
The definition of building services in the ESA 2000 is exhaustive, which means that the defined term is limited to services related to food, security and cleaning and those services prescribed by O Reg 287/01. Building services cannot include other services even if they are analogous to the ones that are specifically mentioned, nor does it include construction, maintenance (other than maintenance activities related to cleaning the premises) and the production of goods (other than goods related to the provision of food services at the premises for consumption on the premises).
The definition of building services in ESA Part I, s. 1(1) includes food services
. This is typically a food services operation that is intended to be exclusively for the use of the employees of a particular company located on the premises, and/or exclusively for the use of persons visiting the premises, but not for persons visiting the premises solely for the purpose of using the food services. It could be a cafeteria-style operation, vending machines or a full-service operation.
The operator of a food court in a shopping mall would not be considered to be providing service for a building with respect to food because, although many users of the food court services may be people who have business within the building (i.e., shoppers), it is likely that some people, such as those working in neighbouring office buildings, will come to the food court just for the food.
Likewise, operators of fast food restaurants in a food court in an office tower would not be considered to fall within the definition of building services. Such food courts are typically located in the public area of a large office building. The owner or manager of the building will typically lease space in the food court area to operators of fast food restaurants that do most of their business at lunchtime. Sometimes the owner will receive a percentage of sales in addition to the base rent. Like the food court in a shopping mall, the food court in an office tower can reasonably be expected to be used by persons who work in other buildings and only come to the food court to have a meal.
Generally, restaurants in food courts are intended for the use of persons other than just those who work or have business in the building in which the food court is located. The food court services the public at large, whether they work or have business in the building or not. Thus a food court cannot generally be said to be services for a building in accordance with the definition in ESA Part I, s. 1(1). This is in contrast to the typical 'company cafeteria' in an office tower, which is designed principally for the use of the persons who work in the building. However, see UFCW, Local 1000A v Cara Operations Ltd., 2001 CanLII 18382 (ON LRB) in which the food court in an airport was determined to fall within the definition of building services under the provisions of the former Employment Standards Act because the food court was considered to be for the exclusive use of persons having business at the airport. Similarly, where a restaurant or food court within an art gallery or museum is virtually exclusively used by patrons of the art gallery or museum patrons, the restaurant could be considered to be services for a building with respect to food within the meaning of the definition of building services in ESA Part I, s. 1(1).
The definition of building services in ESA Part I, s. 1(1) includes security services
. These could be performed through patrols, either on foot or in a vehicle, through a guard sitting at a front desk, through video surveillance or any combination of the above.
The definition of building services in ESA Part I, s. 1(1) includes cleaning services
. This includes cleaning the inside of the building as well as cleaning the outside of the building, e.g., window cleaning services. Cleaning is usually for cosmetic, hygienic or safety reasons. Sometimes cleaning will be referred to as maintenance - see Federated Building Maintenance Co. Ltd. (September 23, 1988), ESC 2377 (Franks). For example, the employees who dust, vacuum and empty the garbage in office buildings are often referred to as providing maintenance services. Although they may be called maintenance, these cleaning activities are building cleaning services. However, maintenance that is of a non-cleaning nature, e.g., repair, preventative work, etc., will not be covered.
There may be some activities that fall into a grey area between cleaning and maintenance. For example, the removal of salty road slush from an indoor parking garage in the winter could be characterized as cleaning, or it could be characterized as preventative maintenance intended to avoid erosion of the concrete. It is Program policy that if the work can be characterized as cleaning, whether or not it can also be characterized in some regard as maintenance, it will fall under the definition of building services.
Under s. 1 of O Reg 287/01, the following are prescribed as building services:
These services may or may not be provided through a comprehensive operations and maintenance contract for such things as janitorial services, landscaping services, driveway, parking lot and sidewalk snow removal, fire alarm services, elevator services, parking lot supervision, heating and air conditioning and plumbing maintenance, and repair and pest control.
For a more detailed discussion of the definition of building services see O Reg 287/01, s. 1.
This definition identifies who is a building services provider
or provider
. The terms building services provider or provider appears in ESA Part IV Continuity of Employment and ESA Part XIX Building Services Providers.
Building services providers include cleaning, security and food companies that provide building services for a premises - see the discussion of the definition of building services above and in O. Reg. 287/01, s. 1.
This definition is inclusive, applying to any person, which includes a natural person as well as a corporation, who provides building services for a premises, including the owner or manager of the premises. As a result, the definition will include managers and property management companies who enter into sub-contracts with cleaning, security and food service operations, or use their own in-house staff to provide such services. It will also include owners that contract with cleaning security and food service operations or use their own in-house staff to provide building services at the premises it owns.
There may also be situations in which a major tenant of an office building, for example, contracts with a company to provide for cleaning or security services which are included in the definition of building services in ESA Part I, s. 1. Under the former Employment Standards Act, the application of the building services provisions was limited to an owner of a building or a manager. However, Program policy was that the term owner included lessees or tenants, where the lessee or tenant had control over the premises and was in a position to enter into agreements with contractors or other parties for the provision of building services. This policy was also supported by the courts, which took a broad view of the term owner where it appeared in the former Employment Standards Act, holding that it could include lessees and tenants where the context was appropriate. In this regard, see Ritchie and Dobbie v. Stanstead and Sherbrooke Fire Insurance Company (1940), 1 DLR 241 (ON CA). As noted above, the ESA 2000 definition of building services provider is inclusive, referring to building services being provided by any person who provides building services for a premises, including an owner or manager. It is therefore Program policy that lessees or tenants who provide building services for a building fall within the definition of building services provider whether as any person or as an owner.
This definition provides that a business
will include an activity, trade or undertaking.
"Business" includes an activity, trade or undertaking;
This definition provides that a "business" will include an activity, trade or undertaking.
The definition of “business consultant” was added to the ESA by the Working for Workers Act, 2022, effective January 1, 2023.
The term “business consultant” is referred to in ss. 3(5) of the ESA. Effective January 1, 2023, ss. 3(5) provides that employees who are business consultants (or information technology consultants) are excluded from the ESA if specified conditions are met. See the discussion of ss. 3(5) of the ESA for information.
Per the definition, a “business consultant” is someone who:
Although the definition uses the word “individual” to describe the person who is providing the advice or services, the definition – when used in the exclusion in ss. 3(5) – applies only with respect to “employees” since independent contractors are not covered by the ESA.
For the purpose of this definition, it does not matter whether the business or organization the employee provides the advice or services to is the employee’s employer, or a client of the employee’s employer.
In addition, the inclusion of the word “services” in the definition (i.e., it applies to an employee “who provides advice or services …”) means the definition also applies to employees who do any of the types of work set out in the definition, not just those who advise on the work. As such, the definition is broad and will capture people who may not normally be considered consultants using the common, non-statutory meaning of that word. For example, the definition could apply to a full-time permanent employee who is a bookkeeper who provides accounting services to the employer (or a client of the employer), and to a full-time permanent human resources assistant or human resources manager who provides human resources services to their employer (or a client of the employer). (Note: being a “business consultant” is only one of the criteria that must be met in order to be excluded from the ESA by virtue of ss. 3(5) – see ss. 3(7) for information on the other criteria.)
Some employees may fit within both the “business consultant” definition and other occupational exemptions from some standards that are set out in regulations made under the ESA. For example, depending on the employee’s duties, the employee may be both a “business consultant” and a lawyer, professional engineer, or public accountant within the meaning of those terms set out in ss. 2(1) of O. Reg. 285/01 (which establishes exemptions from several employment standards). As another example, an employee may be both a “business consultant” and someone who fits within the meaning of the managerial or supervisory exemption in s. 4 and s. 8 of O. Reg. 285/01 (which establish exemptions from most of the hours of work limits and from overtime pay).
In the situation where an employee fits within the “business consultant” definition and meets the additional criteria set out in ss. 3(7), the employee will be excluded from the ESA in its entirety even if there is a narrower occupational exemption that the employee also fits into. This is because being excluded from the entire ESA under ss. 3(5) means that none of the provisions under the ESA or its regulations applies to the employee.
Client
is defined in relation to a temporary help agency and means a person or entity that enters into an arrangement with the agency under which the agency agrees to assign or attempt to assign one or more of its assignment employees to perform work on a temporary basis for the person or entity. A person or entity
includes an individual person, a sole proprietor, corporation, or a partnership.
The arrangement with the agency may or may not be in writing.
This provision defines collector
as a person, other than an employment standards officer, who is authorized by the Director of Employment Standards to collect amounts owing under the Act. The term collector appears in ESA Part XXIV, ss. 127-129. These sections permit the Director to appoint collectors to collect amounts owing under the Act, whether for employees, for the Minister of Finance for amounts owed with respect to monetary penalties associated with notices of contravention or amounts owed to the former Employee Wage Protection Program or for amounts owed to the Director in the form of administrative costs.
The term continuous operation
appears in the public holiday provisions in ESA Part X, s. 28. Section 28 allows an employer in such an operation to require an employee to work on a public holiday if the holiday is on a day that is ordinarily a working day for the employee and the employee is not on vacation.
A continuous operation is an operation (i.e., an activity or service) or that portion of the operation that normally operates 24 hours a day until completion of the regularly scheduled operations for that period.
This may involve, for example, certain portions of, or routes on, a municipal public transportation network, a 24-hour security service, or that portion of an employer’s operation requiring stationary engineers, maintenance mechanics, millwrights or production workers to run machinery, furnaces, or heat-treating baths, etc. on a continual basis until a process is completed.
The operation need not run continuously seven days per week to fall within the definition of continuous operation. However, if the operation were to stop and start more than once in a seven-day period, it would not be considered by the Program to be a continuous operation.
In this regard, the Program disagrees with the arbitrator’s decision in Collins & Aikman Plastics Ltd. v United Steelworkers, 9042. In that case, the employer’s operation ran 24 hours a day for five, six or seven days a week and there was never more than one shutdown within any week. However, the arbitrator concluded that it was not a continuous operation because in his view, a continuous operation included only those employers who cannot stop operations midstream in order to observe a public holiday
or those employers who ran a 24/7 operation.
Only that part of an operation that operates on a 24-hour basis is a continuous operation. For example, in a casino that operates 24 hours a day, seven days a week, the games part of the casino will be a continuous operation, but the office part of the casino, if it operates only during regular business hours, will not be.
Businesses that are open seven days a week but not 24 hours a day are not continuous operations.
This defines the Director
referred to in the Act as the Director of Employment Standards, who is appointed by the Minister of Labour for Ontario. The Director of Employment Standards may exercise powers and is required to perform duties imposed on them under the Act. Many of the powers of the Director have been delegated. For a complete listing of the powers of the Director, and to whom those powers have been delegated, please see Delegation of Powers.
This definition was added by the Fair Workplaces, Better Jobs Act, 2017 SO 2017, c 22.
Domestic or sexual violence leave pay is defined as pay for any paid days of leave taken under ESA Part XIV, s. 49.7. ESA Part XIV, s. 49.7(5) requires that an eligible employee be paid for the first five days of domestic or sexual violence leave taken within a calendar year. The amount of domestic or sexual violence leave pay an employee may be entitled to is determined by ESA Part XIV, ss. 49.7(6), (7) and (8).
The definition of employee specifically includes those persons described in (a) to (d) above. Each description also either explicitly or implicitly refers to a relationship between the person described therein and an employer - see the definition discussed below. It is the existence of the relationship between the employer and the employee that defines an employee for the purposes of the Act. See 1022239 Ontario Inc. (Seventy-Five Hundred Taxi Inc.) v Director of Employment Standards, 2011 CanLII 44478 (ON LRB) and Professional Recovery Equipment Inc. v Mootoo, 2014 CanLII 69932 (ON LRB) in which the Board referred to the factors considered in determining whether an employment relationship exists. In the first case, the issue was whether taxi drivers were employees of the taxi company or independent contractors. In the second case, the issue was whether a tow truck driver was an employee or an independent contractor. Likewise, the definition of employer states that the employer has control or direction of, or is directly or indirectly responsible for, the employment of a person . . .
Therefore, the Act only applies to the employer within the context of the employee-employer relationship.
There is an abundance of case law referring to this relationship, as the roots of the employee-employer relationship date back to the common law notion of master-servant. Because the Act also defines employee in reference to the employee-employer relationship, the common law definitions, with some modification and expansion in light of the intent of the Act, are used to determine whether a person is or is not an employee. See the discussion of the common law tests for employer-employee relationships below.
In addition, this relationship of employee and employer is the subject of other statutes and has been the subject of determinations by administrative tribunals and the courts under those other statutes. However, those determinations have limited application in the context of the ESA 2000 because the purposes of those other statutes are different than the purpose of the ESA 2000.
Therefore, for the purposes of the ESA 2000, the fact that a person is, or is not, considered an employee for the purposes of income tax, employment insurance, workers' compensation, the Labour Relations Act, 1995 or the Canada Pension Plan is not of great relevance. See Deluxe Taxi (Barrie) Ltd. v Employees (April 18, 1973), ESC 125 (McNish), decided under the former Employment Standards Act, and also see 1022239 Ontario Inc. (Seventy-Five Hundred Taxi Inc.) v Director of Employment Standards, a decision of the Board under the current Act.
In Homelife G.M. Ewins Limited v Chiu (September 22, 1987), ESC 2269 (Baum), the referee dealt with a claimant who was not an employee according to a by-law of the Toronto Real Estate Board (“TREB”). The by-law stated that a person who worked full-time elsewhere would not be considered to be employed as a real estate salesperson by an agency such as the applicant. The referee, in finding the claimant to be an employee under the former Employment Standards Act, noted that employment standards legislation takes its own measure
and was not controlled by the private law of such domestic bodies as TREB.
Note that as of November 27, 2017, ESA Part III, s. 5.1 prohibits an employer from treating an employee as if they were not an employee under the Act.
These two sections include as employees those persons who perform work or supply services for wages. The Program position is that the Act does not apply to volunteers.
Since volunteers are not considered to be employees under the Act, it is important to determine whether a person is a true volunteer or an employee. The fact that no wages were paid is not determinative of volunteer status - see Robinson o/a Station Street Café v Ramsay and Ramsay (December 30, 1988), ESC 2434 (Adamson), a decision under the former Employment Standards Act; nor is the fact that there was some form of payment made necessarily determinative of employee status (e.g., a payment may have been made in the form of an honorarium as opposed to wages).
Referee Davis in Consumer Liability Discharge Corporation v Molica (July 24, 1981), ESC 1032 (Davis), a case under the former Employment Standards Act, suggested that:
Applying the first factor in the context of family-run businesses, the question will often be whether the individual is providing their services in pursuit of a livelihood or in service of the family.
Officers of a corporation who perform work or supply services for wages are specifically included in the definition of employee. It codifies previous Program policy that although a person may be a corporate officer, they will nonetheless be considered an employee insofar as they perform work or supplies service for wages.
Clause (c) of the definition of employee defines persons receiving training from an employer as employees if the skill in which the person being trained is a skill used by the employer’s employees.
This provision was amended by the Fair Workplaces, Better Jobs Act, 2017 SO 2017, c 22. Prior to this amendment, the former s. 1(2) held that trainees who met certain conditions were not considered to be employees under the Act. However, this amendment now states that any person who receives training from a person who is an employer is an employee if the skill in which the person being trained is a skill used by the employer’s employees.
The effect of clause (c) is to define some people who receive training from an employer as employees, thereby bringing them under the Act. Note that the fact that an individual did not negotiate for or expect to receive monetary compensation while they were being trained does not preclude a finding that they were an employee, nor will the fact that an individual has agreed to take training in an employer’s business on an unpaid basis in preparation for taking on a job with that employer preclude a finding that their employment began when the training commenced. See 1153800 Ontario Inc. o/a Baker’s Dozen Donuts v Sherren, 2000 CanLII 4482 (ON LRB), decided under the former Employment Standards Act.
In order for an individual who receives training from an employer to be an employee, the individual must be trained in a skill that is used by the employer’s employees. It is the Program position that if the person receiving training is being trained in a skill that could be used by other employees of the employer, even though the employer has no other employees, that person is considered an employee.
However, it should also be noted that ESA Part III, s. 3(5) excludes certain categories of trainees who might otherwise be considered employees:
This exclusion had been scheduled to be repealed as of January 1, 2019, pursuant to the Fair Workplaces Better Jobs Act, 2017. However, under the Making Ontario Open for Business Act, 2018 amendments, the repeal was delayed and it will now be repealed on a day to be named by proclamation of the Lieutenant Governor.” For further discussion of the exclusions in s. 3(5), see ESA Part III, s. 3.
Activities engaged in as part of the pre-employment selection process must be distinguished from training. Persons who are engaged in some form of pre-employment activity are generally not considered employees under the Act, provided that the amount of time spent in the program is reasonably limited in duration and the activities involved do not displace the substantive training, instruction and orientation needed once an employee is hired.
Apprentices are generally considered to be employees for the purposes of the ESA 2000. Even though a worker may be defined as an apprentice under the Apprenticeship and Certification Act, 1998, SO 1998, c 22 or the Trades Qualifications and Apprenticeship Act, RSO 1990, c T.17 and may even have signed an agreement stating that they are to be considered a volunteer, they may still be an employee for the purposes of the ESA 2000.
In Northland White Truck Sales Limited v Laframboise (March 17, 1983), ESC 1380 (Barnett), a case under the former Employment Standards Act, the referee rejected the applicant’s argument that the claimant was not an employee since his employment was regulated by the apprenticeship legislation. The referee found that although the claimant was indeed an apprentice for the purposes of that legislation, he was also an employee for the purposes of the former Employment Standards Act by virtue of s. 1(c) in the definition of employee.
Note, however, that there may be cases where paragraph 2 or 2.1 of ESA Part III, s. 3(5) applies, thereby excluding an apprentice from the application of the Act.
Work performed under an apprenticeship program may be covered by one of these exclusions, since such programs can include classroom training and, as such, form part of a program approved by a college or university or private career college. See ESA Part III, s. 3 for more details on these exclusions.
The Act does not apply with respect to participants in a simulated job environment such as a sheltered workshop although such individuals might otherwise be considered trainees, and consequently employees under the Act. This exclusion had been scheduled to be repealed on January 1, 2019, pursuant to the Fair Workplaces Better Jobs Act, 2017. However, under the Making Ontario Open for Business Act, 2018 amendments, the repeal was delayed and it will now be repealed on a day to be named by proclamation of the Lieutenant Governor.
Participants in a simulated job environment are specifically excluded from the application of the Act see paragraph 6 of ESA Part III, s. 3(5). For a more detailed discussion of this exemption in Part 3 Section 3(5).
This paragraph clearly establishes that homeworkers are to be considered employees for the purposes of the Act, even though some of the circumstances under which homework is performed might suggest that a homeworker more closely resembles an independent contractor than an employee.
A more detailed discussion of the status of homeworkers as employees under the Act can be found in the s. 1 definition of homeworker.
Employee
includes a person who was an employee
The definition of employee also includes a person who was an employee
. This provision ensures that the recovery of entitlements that should have been given to an employee under the Act is not precluded merely because the individual concerned is no longer in the employee-employer relationship.
The Act only applies where there is an employment relationship. The central question is whether an employee-employer relationship exists between the two parties. The determination of whether someone is an employee or an independent contractor is complex and the courts have created a number of common law tests for determining whether an employee-employer relationship exists. As noted above in the discussion of employee, the Board, referees adjudicators and the courts have referred to other sources, notably the common law tests, to determine if an employee-employer relationship exists.
The definition of employee in s. 1 is not exhaustive and has traditionally been interpreted in an expansive fashion. However, it is not always clear whether a person performing work for an employer is an employee as defined in s. 1 of the ESA 2000 or an independent contractor. An independent contractor is in business on their own account and is therefore not entitled to the same protections as employees under the ESA . Although the ESA does not contain a test for determining whether a person is an employee or an independent contractor, it is Program policy that the determination of whether or not an individual is an employee or independent contractor should be considered broadly utilizing the various tests and any other relevant factors.
Note that as of November 27, 2017, ESA Part III, s. 5.1 prohibits employers from treating employees as if they are not employees under the Act. It is important to note that parties cannot decide employee status merely by mutual agreement or by the signing of a written document, such as an employment contract or independent contractor agreement. Nor does the method of remuneration and whether statutory deductions are made greatly impact the determination of whether there is an employment relationship. Rather, it is the overall relationship that determines whether an employer-employee relationship exists. See for example Econome Inc. v Champagne, 2017 CanLII 14543 (ON LRB), in which the employer tried to rely on an unsigned employment agreement to indicate that the employee was not an employee. The Board disagreed and noted that the existence or form of a written contract does not impact an employee’s status, particularly where the individual in question works full time and exclusively for the employer.
The Supreme Court of Canada in 671122 Ontario Ltd. v Sagaz Industries Canada Inc., [2001] 2 SCR 983, 2001 SCC 59 (CanLII) distinguished between the relationship of an employee and an employer and the relationship of an employer and an independent contractor, who is in business on their own account. Major J., writing for the majority, reviewed the various tests developed by the case law and held that there is no one conclusive test which can be universally applied to determine whether a person is an employee or an independent contractor
(at paragraph 46). In making the determination, what must always occur is a search for the total relationship of the parties
(at paragraph 46). Major J. provided further guidance by stating in paragraphs 47-48:
The Supreme Court of Canada’s decision in 671122 Ontario Ltd. v Sagaz is essentially a restatement of the Federal Court of Canada’s decision in Wiebe Door Services Ltd. v M.N.R., [1986] 3 FC 533 (CA). The non-exhaustive list of factors above does not replace the factors in the traditional common law tests, since no single test can answer the question of whether a person is an employee or an independent contractor in all situations. As Major J. noted, the key question is whether the person who has been engaged to perform the services is performing them as a person in business on their own account.
The classic common law tests, and the analysis given them by the Supreme Court of Canada in 671122 Ontario Ltd. v Sagaz are discussed below.
The Supreme Court in 671122 Ontario Ltd. v Sagaz first reviewed the control test. Under this test, an individual is characterized as an employee if there is an employer who can control, or has the right to control the employee: the essential criterion of employer-employee relations is the right to give orders and instructions to the employee regarding the manner in which to carry out his work
- see Hôpital Notre-Dame de l'Espérance and Théoret v Laurent, [1978] 1 SCR 605, 1977 CanLII 8 (SCC) at 613. Major J., writing for the Court, notes that the control test is problematic and has been criticized as having an air of deceptive simplicity. The indicia of control is thus no longer a sole determining factor of whether there is an employment relationship.
Although the control test has been rejected as the sole determining factor of whether there is an employment relationship, the element of control is one of the factors in other common law tests, notably the four-fold test, discussed below. Major J. in 671122 Ontario Ltd. v Sagazindicated that the level of control the employer has over the worker’s activities will always be a factor in determining whether there is an employment relationship.
What is meant by the term control has expanded from the initial focus on the manner in which work was done. As workers became more specialized and skilled relative to their employers, there was less need for the workers to be told how each facet of their work was to be done. Other aspects in which employers have control of the activities of their workers fall within the element of control:
The manner of payment may indicate whether a sufficient degree of control is present in order for there to be an employment relationship. If a person is paid proportionate to the amount of work done rather than the time occupied or for a lump sum, this may indicate that such a person is being employed as an independent contractor.- See Becker Milk Co. Ltd. v Hajjar et al(January 31, 1973), ESC (Carter).
Major J. in 671122 Ontario Ltd. v Sagaz also reviewed the classic four-fold test of Montreal (City) v Montreal Locomotive Works Ltd. [1944] UKPC 44, which was an attempt to deal with the problems of the control test. The four-fold test retains the element of control as a key indicator of the employment relationship, but examines additional factors to provide a means of distinguishing between an employee and an independent contractor. The test involved four elements, as follows:
Toolsdoes not refer only to such items as hammers, lathes and cleaning mops, but can include any item used at the workplace, such as forms, manuals, promotional literature and a telephone. A person who owns all the equipment necessary for the work they do is more likely to be an independent contractor than an employee. Likewise, if the tools are supplied by the purported employer, it is more likely indicative of an employee-employer relationship.
The Supreme Court of Canada in 671122 Ontario Ltd. v Sagaz also considered the organization test or integration test, which was approved by that Court in Co-operators Insurance Association v. Kearney, [1965] SCR 106, 1964 CanLII 21 (SCC) and followed in Mayer v J. Conrad Lavigne Ltd., 1979 CanLII 2088 (ON CA). This test examines whether the alleged employee is an integral part of the employer’s organization, in which case the individual is an employee, or a mere accessory to it, in which case they are an independent contractor. The test was initially proposed by Lord Denning in Stevenson, Jordan & Harrison Ltd v MacDonald & Evans [1952] 1 TLR 101 as follows:
Major J. in 671122 Ontario Ltd. v Sagaz stressed the difficulties with the organization test: it can be a difficult test to apply, because if the question is whether the activity or worker is integral to the employer’s business, the question can usually be answered in the affirmative. If the test is applied to demonstrate that, without the work of the alleged employees the employer would be out of business, a factual relationship of mutual dependency would always meet the test. Nonetheless, Major J. acknowledged that the organization test can be useful if properly applied, looking at the question of integration from the perspective of the employee and not that of the employer. If the test is applied from the employer’s perspective, it is too easy to assume that every contributing cause is arranged purely for the convenience of the larger enterprise.
In Pinnacle Roofing Systems Inc. v Thompson, 2009 CanLII 9251, the Board summarized the organizational test as two main questions: (1) is the alleged employee an integral part of the business or ancillary [to it]?; and (2) is the employee’s work subject to coordinated control as to where and when rather than the how? In applying the test, the OLRB found that a sheet metal worker was an employee because his work was an integral part of the employer’s business within the meaning of the organizational test.
The definition of employee in ESA PI, s. 1 is inclusive, which means that it is not a closed set of characteristics. The statutory purpose test, like the definition of employee, is meant to be expansive and inclusive. The test was first formulated inMajestic Maintenance Services Limited (February 8, 1977), ESC 479A (Burkett), in which Referee Burkett held that the traditional common law tests were not appropriate for interpreting the scope of the Act when the Act was clearly designed to expand upon or enhance the protections of the common law. Referee Burkett concluded that the existence of an employment relationship should be assessed by reference to the purpose of the statute, which he characterized as intended to provide certain benefits to persons who by reason of their economic dependence or lack of bargaining power in the market place, might otherwise have to work on terms below the basic minima established in the Act.
Referee Burkett further observed that “Whereas the Act is not designed to protect or underwrite the independent businessman… it must be said (and indeed it follows from the Becker decision) that it is designed to protect those who are dependent in their employment.”
The statutory interpretation test was further parsed out by the OLRB in Andrew Beyers Carpentry Inc. v Mohammed, 2010 CanLII 23842 (ON LRB). The Board noted that the purpose of the ESA 2000 is to address the potential negative effects of unequal bargaining power between employees and employers. The Board stated that although the statutory purpose of the Act is easy to state, its application to a variety of “ever-changing” contractual agreements designed to obtain skills and services in a cost-effective way is challenging, and requires nuanced analyses to determine if there is economic dependence even where those agreements were specifically designed to include features that are commonly associated with independent contractors.
In applying the statutory interpretation test, the Board considered the claimant’s work in the context of the construction industry. The Board noted that in the context of the construction industry, workers had more economic power in providing skills and services than in industrial settings, but there was no fundamental change to the underlying inequality between worker and employer. Furthermore, the Board stated that the fact that construction work is often done in multiple relationships of short duration and little day-to-day supervision was merely a function of the industry itself (e.g., duration of projects and the highly skilled nature of the worker), and not necessarily evidence of an independent contractor arrangement. The Board found that a relationship of economic dependence characteristic of the construction industry existed between the employer and the claimant. It was clear that the claimant agreed to provide her work regularly without any specified hour limit and with the expectation that she would be paid on a weekly basis. The Board found that the fact that the claimant agreed to use her cell phone and car was more indicative of her weak negotiating position than of her being an independent contractor. The fact that the employer did not take statutory deductions off of her pay and that the claimant was happy with that arrangement was not determinative, because the ESA 2000 is not applied in accordance with the preferences persons may have with respect to other statutes.
Following the Supreme Court of Canada’s decision in 671122 Ontario Ltd. v Sagaz, the Board has generally not applied one singular test for determining whether an employee-employer relationship exists. Rather, the Board has broadly utilized the various tests and any other relevant factors. Similarly, it is Program policy that the various common law tests and any other relevant factors should be applied and considered when determining when an individual is an employee or an independent contractor. The following Board decisions are some good examples of how the common law tests and other factors have been utilized.
In Warren v 2006515 Ontario Inc., 2005 CanLII 1757 (ON LRB), the OLRB looked at several factors in determining that the claimant, a manager of a health food store, was in fact an employee and not an independent contractor. There were several facts that suggested the claimant was an independent contractor: she invested in one product for sale to her own profit; for a period, she financed the balance of the inventory; she used the terms “Nutritional Services” and “Managerial Services” on documents to describe the work she did for the employer; and no statutory deductions were made from gross amounts owing to her for work performed. However, the OLRB found that there was substantial evidence to determine that the claimant was in fact an employee: the employer had control over her activities; the employer provided the premises and the equipment used; the employer had ultimate control to determine what product would be stocked; and the claimant had essentially no opportunity for profit or risk of loss. The Board has followed the approach articulated in Warren v 2006515 Ontario Inc. in other decisions, for example: Big Picture Home Entertainment Limited v MacDonald, 2016 CanLII 82670 (ON LRB); Iris Blu Staffing Limited v Irwin, 2016 CanLII 56987 (ON LRB); and Bining v 1391165 Ontario Inc. (Wallace Transport), 2009 CanLII 33872 (ON LRB).
In Teneva v 946900 Ontario Limited o/a Idlewood Inn/Cloverleaf Motel, 2016 CanLII 2422 (ON LRB), the OLRB considered whether a housekeeper for a motel was an employee or an independent contractor. The employer relied on a document signed by the claimant that stated she agreed to be an independent contractor. The employer also argued that the claimant could set her own schedule, refuse work and increase her profits by cleaning more rooms.
The OLRB found that the “independent contractor agreement” was not determinative. The OLRB stated that whether or not an individual is an employee is a question of fact and law to be determined after consideration of all of the relevant factors. The OLRB noted that the intention of the parties is relevant only to the extent that it is reflected in the actual structure and circumstances of their relationship, that is, parties cannot by their “agreement” make their relationship as one of independent contractor if the facts show that there is an employee-employer relationship.
The OLRB found that the claimant was an employee based on the following facts: the employer exercised substantial control over the claimant’s schedule; the claimant was expected to answer the employer’s call to work, regardless of the time of day, which meant that the claimant was unable to work for any other employer or attend job interviews to find alternate employment; the employer provided the claimant with all the cleaning products and equipment she required; and the claimant had limited ability to profit from cleaning rooms, as the employer decided the number and type of rooms she was to clean.
In Ilaris Corporation v Gadzevych, 2007 CanLII 19192 (ON LRB), the OLRB considered whether a claimant who performed repair and renovation services for a fixed amount on a per project basis was an employee or an independent contractor. The OLRB concluded that he was in fact an employee because he was an integral part of the employer’s business. Although he was hired for a fixed amount per project, he was not free to substitute someone else to perform the work and there was no sense in which he could be described as being in business for himself.
In Appleseed Snow Blowing Service Inc. v Bourguignon, 2005 CanLII 38056 (ON LRB), the OLRB found that the claimant, a snow shoveler, was an independent contractor whose snow shoveling activities were more akin to being engaged in business on his own account. There was no ongoing working relationship between the snow shovelers and the employer, and snow shovelers were free to engage in other activities or employment in between snowfalls. The employer exercised little control over the activities of the snow shovelers as it did not require them to work following every snowfall and did not dictate hours of work, how or in what order the work was to be done. The snow shovelers also arranged their own transportation between work sites and provided their own equipment.
There are other persons who may or may not be considered employees for the purposes of theESA 2000, some of whom are discussed in greater detail below. For information regarding the exclusions in s. 3(5), see ESA Part III, s. 3.
Paragraph 11 of s. 3(5) and s. 3(6) of the Act read:
These sections provide that the Act does not apply with respect to directors of a corporation, in their role as directors, except as provided in ESA Parts XX-XXVIII. However, the Act does apply to an individual who is a director but who also performs work or occupies a position as an employee. In order to determine whether ESA Part III, s. 3(6) applies, however, it is Program policy that directors, who constitute the controlling mind of a corporation, are not, in the absence of clear evidence of an employment contract, to be considered employees for the purposes of the Act. See Re D.J.'s Family Centre Ltd., 1977 CanLII 1331 (ON SC) and Satellite Computer and Communication Systems Ltd. v Dryla (May 8, 1980), ESC 784 (Adamson), decisions under the former Employment Standards Act.
For cases under the former Employment Standards Act where a director of a corporation was also found to be an employee, see Algoma Rubber Services Ltd v Johnston (April 19, 1982), ESC 1205 (Eaton), where the Referee held that although the claimant was a director of the company, a minority shareholder and held the position of Vice-President and General Manager, his directorship did not preclude a finding that he was an employee for the purposes of the former Employment Standards Act. The referee found that there was a contract of employment and that the claimant was receiving wages within the meaning of the Act, and not being paid a consulting fee for his services. In addition, he was a Director in name only and his minority shareholder position was such that he had no effective say in the control of the company. See also Munro v Cord King International (August 24, 1998), 2086-97-ES (ON LRB), where the adjudicator found on an application for review of an employment standards officer’s decision that the applicant, who was both a president and director of a company, was an employee under the former Employment Standards Act and therefore entitled to receive unpaid wages. While the applicant did have the title of president, he had no control over the decisions of the company, no control over its finances, and no substantial ability to hire, terminate, discipline or set salaries for the employees. As for his directorship, the employer had designated him as a director without the applicant’s knowledge or consent.
A partnership is the relationship that exists between parties carrying on business in common with a view to profit. In the same way that a person cannot be their own employee, a partner cannot be employed by the partnership. See Berini o/a Noront Printing v Purificati (September 9, 1975), ESC 286 (Soubliere), a case decided under the former Employment Standards Act. The fact that a claimant is registered as a partner is not conclusive of partnership status, as there may be factors that will lead to a conclusion that the so-called partner is actually an employee for the purposes of the Act. To be partners, parties must have an agreement to carry on business in common and share profits. Some of the other indicia of partnership status include the contribution by the parties of money, property, effort, knowledge, skill or other assets to the common business, a joint ownership interest in the business, a mutual right of control or management of the enterprise, and authority to contract liabilities in respect of the business that is being carried on. Therefore, it is essential to look closely at the relationship between the parties to determine if the facts are more indicative of a partnership or an employer-employee relationship.
Corporate shareholders may be employed by the company in which they own shares. Even a major shareholder with a controlling interest in the company may be an employee, though they would have to occupy an employee position - shareholder status obviously does not make an individual an employee.
An agent is someone who can make a contract or dispose of property on their principal’s behalf. This authority may be held by an independent contractor or by an employee. Therefore, the fact that a claimant is an agent is not determinative. The common law tests must be applied when examining the relationship to determine whether the claimant is an independent contractor/agent or an employee/agent.
Bona fide franchisees are generally not considered to be employees. In Groulx v Loeb Inc. (November 26, 1992), ES 203/92 (Novick), a case under the former Employment Standards Act, the claimant argued that he was a glorified store manager, not a franchisee, due to the high degree of control exercised by the franchisor: the franchisor held the head lease for the store premises, Loeb management was generally involved in the demotion and termination of employees in the franchisee’s store, the franchisor suggested retail prices for the store’s products, and the franchisee store was generally required to order its stock from Loeb. The adjudicator found, however, that the franchisee was not an employee because of the following: the claimant was the sole shareholder of the franchisee operation; he invested a substantial amount of money into the store at various stages, running the risk of significant financial loss or gain; and the claimant’s company owned all of the equipment and inventory in the store. The claimant also made all key decisions with respect to the purchasing of products and the prices at which they were sold, albeit in accordance with dictated norms or industry practice; decided hours the store would be open; and had authority to hire and fire employees.
Where a claimant is party to a lease agreement, leasing the business premises from a third party, they will not generally be considered an employee.
However, there are exceptions to this. For example, in Anderson et al v Neil operating as Gerry Neil Texaco Service (September 13, 1973), ESC 181 (McNish), the claimant was found to be an employee under the former Employment Standards Act even though he had a lease agreement with the Texaco Oil Company. The referee found Mr. Neil (the claimant) to be in the same position as a foreperson in a normal employee-employer arrangement. Most significant was the fact that Texaco maintained financial control on a daily basis and that Mr. Neil was paid a flat salary, not a share in the profits of the business.
Persons on strike are employees under common law and are also considered to be employees under the inclusive definition in the ESA 2000. For example, see Re Domtar Chemicals Limited (August 17, 1973), ESC 139 (Fram), a decision under the former Employment Standards Act.
When a person has incorporated and provides services through the corporation, the assumption is often made that the person is, therefore, an independent contractor as opposed to an employee. However, where the person themselves is providing services through the corporation, the fact of the incorporation does not preclude a finding that they are an employee for the purposes of the ESA 2000. The common law tests should be applied to determine if the relationship is in fact one of employee-employer.
For example, in Queensbury Enterprises Inc. v J.R. Corporate Planning Associates Inc., the Ontario High Court held that there was an employee-employer relationship where a personal services corporation was retained to provide the defendant with financial consulting services. The sole and principal shareholder of the corporation was found to be an employee of the defendant, and therefore entitled to reasonable notice of termination.
Temporary help agencies provide personnel to clients who require temporary or short-term help. A common example is the agency that supplies its clients with secretaries, data entry clerks, etc. during peak periods or when a replacement is required due to illness or pregnancy or parental leave. Although the personnel are subject to the host business' control with regard to the work they do for the client, they are not employed by the client. Generally speaking they are regarded as employees of the temporary help agency, for the purposes of the ESA 2000. See Occasional Office Help c.o.b. Data Capture v Tinney et al (July 28, 1977), ESC 444 (Picher) and Taylored Drivers Inc. v Beck et al (March 3, 1980), ESC 720 (Adamson), decisions under the former Employment Standards Act which discussed the issue of Elect to Work
status of temporary help agency employees.
It should be noted, however, that just as one must always look to substance and not be misled by form when determining whether an employment relationship exists, one must also look to substance and not be misled by form when considering whether the host business is in fact the employer, or at least an employer (along with the agency, under the joint unrelated employers rule) for purposes of the Act. This is particularly likely to be the case where an individual spends many years working in the same job for the same host business without interruption while having ostensibly been employed by a succession of unrelated temporary help agencies, each of whom supposedly provided the individual’s services to the host and where the individual’s situation throughout was not distinguishable, as a practical matter, from that of an employee of the host. However, one should not be quick to draw the conclusion that an individual supposedly employed by a temporary help agency is in fact an employee of a host business; temporary help agencies fulfill an important and legitimate function, and where someone’s services are apparently being provided to a host through the medium of an agency it should not lightly be assumed that form does not in fact reflect substance.
The definition of “employer” includes the persons described in (a) and (b) above. It is the existence of a relationship between the employer and the employee (in the form of employment) that imposes the statutory obligations upon the person(s) defined as employer for the purposes of the Act.
An inquiry as to whether an employment relationship exists is resolved by applying the common law tests described in the preceding discussion on the employee definition. Essentially, the common law tests may be applied to determine whether a claimant is an employee, thereby imputing the position of employer to the other party to the employment relationship.
It should be noted, however, that the term employer as defined in the Act is given a broader meaning than its ordinary common law meaning. The term employer in the Act includes persons who may not be considered employers at common law. The Act also allows for the possibility of more than one person having employer status in relation to the same employee, either as persons having control or direction of an employee or having responsibility, directly or indirectly for the employment of a person, or entities carrying on associated or related activities or businesses with such persons. Therefore, it is necessary to determine which of these possible employers owes the statutory obligations set out in the ESA 2000 to the employee.
This part of the definition states that any owner, proprietor, manager, superintendent, overseer, receiver or trustee who has control or direction of, or is directly or indirectly responsible for, the employment of a person is an employer.
In Re National Bank of Canada et al. and McArthur et al., 1986 CanLII 2837 (ON SC), a receiver-manager had refused service of an order to pay under the former Employment Standards Act in respect of employee vacation pay entitlements, arguing that it was not an employer under the Act. On judicial review of the case, the Divisional Court ruled that the Ministry had acted properly in serving the receiver-manager with the order, as a means of ensuring that the employee entitlements were dealt with properly from the proceeds of realization. In affirming the referee’s decision, the Court stated:
Amendments to the former Employment Standards Act in 1987 specifically included receivers and trustees within the definition of employer to codify the principle that the definition was intended to include such persons who have control of, or direct or indirect responsibility for, the employment of a person.
It should be noted that it has not been and is not the policy of the Program to consider the receiver or trustee personally liable for ESA 2000 obligations incurred by an insolvent employer where the receiver or trustee continues to operate the employer’s business for some period of time following insolvency, for the purpose of carrying out his/her obligations respecting distribution among creditors. However, if the receiver or trustee was carrying on business for a lengthy period of time with no apparent view to distribution, the Program might consider imputing personal liability on the trustee or receiver.
In Baldeo et al v Regent Park Community Improvement Association (May 26, 1980), ESC 790 (Ellis) the Referee held that the former Employment Standards Act's definition contemplated the possibility of each employee having a number of different employers at any one time. Although he acknowledged that this concept might not accord with other substantive aspects of the Act, he felt that the definition was workable if it was interpreted as referring to a particular person as an employer as determined by the aspect of the employment for which that person is or was in fact responsible directly or indirectly, or over which he did indeed have control or direction.
In that case, the issue was which of two entities, the Association or the Ontario Housing Commission (“OHC”), was the employer of the claimant laundry attendants with regard to their claims for unpaid wages and vacation pay. The laundry attendants had been hired by the Association and were paid by the Association, pursuant to a contract between the Association and the OHC. Under the contract, the OHC provided funds, including those paid out to the laundry attendants by the Association as wages, for the building management services supplied by the Association.
The Association took the position that the OHC was the true employer and that the Association’s status as employer was nominal only.
The Referee examined the contract and the relationship between the Association and the OHC and noted (among other things) that the Association was in a legal position, pursuant to its contract with the OHC, to control the way the agreed-upon arrangements concerning the employment of the claimants were administered. The Association thereby assumed a responsibility to the persons employed, pursuant to that arrangement, to see that their rights with respect to wages and like matters would not be jeopardized by the nature of that arrangement, or the way in which it was administered.
As a consequence, the Referee held that the Association was a person who, as a manager, superintendent or overseer
, was directly or indirectly responsible
for the compensation aspects of the complainants' employment. Therefore, the Association was an employer for the purposes of the complaints in question.
However, he also noted that the laundry rooms were the property of the OHC and, in fact, were facilities that the OHC was obligated to provide to its tenants. The supervision of the staff of those facilities (the laundry attendants) was, as a practical matter, largely assumed by the OHC senior project manager. In addition, the laundry attendants were required to attend training sessions run by OHC staff. Finally, the OHC strictly controlled the Association’s funding, thereby indirectly controlling the payment of wages to the laundry attendants. The Referee therefore held:
Although the Referee was unable to attach any liability for the unpaid wages and vacation pay to OHC by reason of its status as a Crown agency, he did make it clear that both the OHC and the Association fell within the definition of employer under the former Employment Standards Act as regards the laundry attendants' claims. See ESA Part III, s. 3.1 for more information on Crown agencies and employees.
It should be noted that the referee did not suggest that every person who could be seen as falling within the broad definition of employer under the former Employment Standards Act would necessarily incur every liability that could possibly befall an employer under that Act. He recognized, for example, that in light of the definition a foreperson might be considered an employer for some purposes, but that a foreperson should not be considered to be personally liable for unpaid wages. In the referee’s view, the key to applying the definition in s. 1 where more than one person fell within the definition was that a person or persons could be held responsible only for those aspects of the employment relationship in respect of which it could be said that they had control or direction of, or were directly or indirectly responsible for the person’s employment. This principle enunciated in Baldeo et al v Regent Park Community Improvement Association continues to be the Program’s policy under the ESA 2000.
It is also important to note that the joint liability of OHC and the Association in the above case was not based on the provision in the Act that provides for one or more entities to be treated as one employer, often called the related employers' provision. That provision is referred to in clause (b) of the definition of employer of the ESA 2000 and defined in ESA Part IV, s. 4 - see the discussion below under Related Employers.
Section 4 of the Act is reproduced below:
This section expands the definition of employer to include persons who carry on or have carried on associated or related activities or businesses with the principal employer, and aims to hold them accountable as one employer. Such persons are commonly referred to as related employers
.
While each joint unrelated employer must have direct or indirect control or responsibility for the employee in order to be found to be a joint unrelated employer, related employers do not have to have such control or responsibility, though obviously the principal employer must in order for there to be a related employer finding. It is the relationship of the related employer to the principal employer, rather than its relationship, if any, to the employee, that is the source of the liability under the Act.
For further discussion, refer to ESA Part III, s. 4.
This defines employment contract
as including a collective agreement. The term collective agreement is not itself defined in the ESA 2000, but would presumably include any agreement between an employer and a trade union, as defined in ESA Part I, s. 1, that contains the terms and conditions of employment for employees in a bargaining unit represented by that trade union.
The definition of employment contract in ESA Part I, s. 1 is inclusive, not exhaustive. This means that, under the definition, a collective agreement is just one particular example of what constitutes an employment contract. Other examples that are not specifically mentioned in the definition but that fall under the definition include a written employment contract between an employer and a non-unionized employee, an oral contract between an employer and a non-unionized employee, and an implied contract between an employer and a non-unionized employee.
This defines an “employment standard” as being an employer’s obligation for the benefit of an employee under the Act.
As reflected by the name of this Act, the concept of employment standards is the core of this legislation. The Act both establishes and provides for the enforcement of minimum rights, both monetary and non-monetary, with respect to the terms and conditions of employment.
An establishment is defined as a location where the employer carries on business. Separate locations will be considered one establishment if they are in the same municipality. Locations in separate municipalities will also be considered one establishment if an employee in one location has contractual bumping rights that extend to the other location. Bumping rights are typically found in collective agreements, but they can also sometimes be found in employment contracts that are not collective agreements.
It is the policy of the Program that it is the largest area of municipal organization that will constitute the municipality for purposes of the definition of establishment in the Act.
In some cases, the largest area of municipal organization will be an upper tier municipality, e.g., the Regional Municipality of Peel; in such a case, the area of a lower tier municipality within the upper tier municipality (e.g., the City of Brampton) would not be treated as the municipality for the purposes of the establishment definition.
In other cases, there may not be any upper tier or lower tier municipality, but simply a single tier municipality, e.g., the City of Toronto.
To determine whether a particular location is within an upper tier municipality, reference might be made to the Ontario Municipal Directory, which is published by the Association of Municipal Managers, Clerks and Treasurers of Ontario, or to the list of All Ontario Municipalities link on the website of the Association of Municipalities of Ontario.
A homeworker
is a person who performs work for compensation in a place that is primarily used as the person’s home. The definition of homeworker does not include persons employed to perform work in premises that are not their residence, such as domestic workers, housekeepers, and homecare workers of social service agencies.
If an individual performs any type of work in premises that are occupied by them primarily as residential quarters for compensation, that individual will fall within the definition of homeworker. The definition in the ESA 2000 is expansive in that it includes all types of work, including sewing operations, assembly and packaging operations (e.g., of small parts, toys or games), addressing envelopes (e.g., for direct mail advertisers), typing (e.g., of insurance policies), design of computer programs, and editing on a word processor, and other types of work that do not involve the manufacture, preparation, improvement, etc., of goods such as telemarketing.
Special rules regarding homeworkers apply in the case of recordkeeping, minimum wage and the provisions regarding advising homeworkers of the calculation of homeworkers' wages and the deadlines for completing their work. See ESA Part VI, s. 15(2), O Reg 285/01, s. 5(1) para. 4, ss. 5(2) and 5(3) and O Reg 285/01, s. 12, respectively.
A homeworker is an employee by virtue of paragraph (d) of the definition of employee in ESA Part I, s. 1(1):
The specific exclusion of independent contractors in the homeworker definition was added in the ESA , 2000 to clarify that just because homeworkers are listed under the definition of employee does not mean that all homeworkers are employees.
Whether a particular homeworker is an employee, or an independent contractor not subject to the Act, may sometimes be difficult to decide.
In one decision under the former Employment Standards Act, Sparta Mercantile Ltd. v Hulst (June 21, 1984), ESC 1657 (Brown), the referee applied the standard common law tests (the four-fold test and the organization test - see the definition of employee in ESA Part I, s. 1) and and concluded that the of home-sewers was more clearly equivalent to that of an independent contractor, and that accordingly they were not employees. This decision was contrary to the Program’s policy under the former Employment Standards Act. Consequently, Sparta Mercantile Ltd. v Hulst should not be relied upon for assistance in determining whether an individual who performs work for compensation out of premises that is primarily their residential quarters is an employee.
In C.N. Shoes Ltd. v Vanin (Feburary 4, 1985), ESC 1780 (Davis), another decision under the former Employment Standards Act, the claimant made leather uppers for shoes and owned most of the hand tools, while the company supplied the jack, leather, thread and beeswax. Every Friday, the claimant took to the company factory the work completed during the preceding week, and received a further supply of work for the next week. At that time he signed a standard work order for the completed items, which described the claimant as a sub-contractor, and the claimant was paid accordingly.
The employer in C.N. Shoes Ltd. v Vanindid not exercise the kind of control over the home-cobbler that was common to employer-employee relationships. However, the referee held that homeworkers are not required by the Act to conform to the typical employer-employee relationship and questioned the usefulness of the common law tests applied in Sparta Mercantile Ltd. v Hulst. After all, one of the inherent characteristics of homework is that the employee works at home with little supervision, deciding when and how to work. If a common law test is required, the referee considered the organization test to be the appropriate one in the circumstances. The claimant was a necessary and integral part of the company’s business: without his work on the uppers, no shoe could be completed.
This definition provides that the term hospital
under the ESA 2000 has the same meaning as under the Hospital Labour Disputes Arbitration Act, RSO 1990, c H-14 (HLDAA
).
The HLDAA defines hospital as:
This definition in HLDAA was amended in 2010, by replacing the terms nursing home
and home for the aged
with the term long-term care home
. This amendment did not alter the substance of the definition, as long-term care home includes what was previously referred to as nursing homes and homes for the aged.
The term hospital appears in ESA Part X Public Holidays.
This definition was added by the COVID-19 Putting Workers First Act, 2021, effective April 29, 2021.
Infectious disease emergency leave pay is defined as pay for any paid days of leave taken under ss. 50.1(1.2). That subsection provides eligible employees with an entitlement of up to three paid days of infectious disease emergency leave in certain circumstances related to a designated infectious disease.
The manner for calculating the infectious disease emergency leave pay an employee may be entitled to receive is established by ss. 50.1(1.11).
The definition of “information technology consultant” was added to the ESA by the Working for Workers Act, 2022, effective January 1, 2023.
The term “information technology consultant” is referred to in ss. 3(5) of the ESA. Effective January 1, 2023, ss. 3(5) provides that employees who are information technology consultants (or business consultants) are excluded from the ESA if specified conditions are met. See the discussion of ss. 3(5) of the ESA for information.
Per the definition, an “information technology consultant” is someone who:
Although the definition uses the word “individual” to describe the person who is providing the advice or services, the definition – when used in the exclusion in ss. 3(5) – applies only with respect to “employees” since independent contractors are not covered by the ESA.
For the purpose of this definition, it does not matter whether the business or organization the employee provides the advice or services to is the employee’s employer, or a client of the employee’s employer.
In addition, the inclusion of the word “services” in the definition (i.e., it applies to employees “who provide advice or services …”) means the definition also applies to employees who do any of the types of work set out in the definition, not just those who advise on the work. As such the definition is broad and will capture employees who may not normally be considered consultants using the common, non-statutory meaning of that word. For example, the definition could apply to a full-time permanent employee employed as an IT technician who tests the IT system of their employer (or a client of the employer). (Note: being an “information technology consultant” is only one of the criteria that must be met in order to be excluded from the ESA by virtue of ss. 3(5) – see ss. 3(7) for information on the other criteria.)
Some employees may fit within both the “information technology consultant” definition in s. 1 of the ESA and other occupational exemptions from some standards that are set out in regulations made under the ESA. For example, depending on the employee’s duties, the employee may be both an “information technology consultant” and an “information technology professional” within the meaning of that term as set out in s. 1 of O. Reg. 285/01 for purposes of the exemptions from overtime pay and most of the hours of work limits that are established in s. 4 and s. 8 of O. Reg. 285/01. As another example, an employee may be both an “information technology consultant” and someone who fits within the meaning of the professional engineering term set out in ss. 2(1) of O. Reg. 285/01 (which establishes exemptions from several employment standards).
In the situation where an employee fits within the “information technology consultant” definition and meets the additional criteria set out in ss. 3(7), the employee will be excluded from the ESA in its entirety even if the employee also fits within a narrower occupational exemption. This is because being excluded from the entire ESA under ss. 3(5) means that none of the provisions under the ESA or its regulations apply to the employee.
This defines labour relations officers referred to in the Act as officers appointed under the Labour Relations Act, 1995.
This definition provides that references in the Act to Minister
are references to the Minister of Labour.
This definition provides that references to Ministry
in the Act are references to the Ministry of Labour.
This provision defines overtime hour
as:
The term overtime hour appears in the definitions of regular rate and regular work week, and in ESA Part VIII Overtime Pay and ESA Part X Public Holidays.
The purpose of this provision is to avoid having to add a reference to union where the Act was making a reference to person
. In law, a trade union is not normally considered to be a person. The definition is inclusive, and so should not be taken to exclude other persons, such as individuals and corporations. In law, a corporation is a person.
Under ESA Part X Public Holidays, employees may have the right to receive, among other entitlements, premium pay if they work on a public holiday. Section 24(2) states that the amount of premium pay must be at least one and one half times the employee’s regular rate.
For further discussion, please refer to ESA Part X Public Holidays.
This definition provides that the word prescribed
means as set out in the regulations under the ESA 2000.
Public holiday
means any of the following:
This provision defines public holidays for the purposes of the Act. Note that where a substitution is made, as provided for in ESA Part X, that substitute day is to be treated as if it were the named public holiday. This means that the substitute holiday takes the place of the public holiday. Therefore, the formula to be used for calculating public holiday pay for the substitute holiday would be the formula that is in effect on the date of the substitute holiday.
In each year:
For the purposes of the public holiday provisions, the Program considers a day to be a calendar day running from 0001 hours to 2400 hours. It is Program policy that where a shift spans two calendar days, the entire shift is, unless the employer has adopted a different policy that is reasonable and that it consistently applies, considered to have been worked on the calendar day on which the shift began. For example, where an eight-hour shift commenced at 11 p.m. on the Thursday evening before Good Friday, the seven hours actually falling on Good Friday will not be considered to have been hours worked on a public holiday. Similarly, where an eight-hour shift commenced at 11 p.m. on the evening of Good Friday, all eight hours are considered to have been worked on the public holiday, notwithstanding that seven of them actually fell on the next calendar day.
Under the circumstances set out in ESA Part X Public Holidays, employers must pay employees public holiday pay for a public holiday. Section 24(1) states that the amount of public holiday pay must be equal to:
For further discussion, please refer to ESA Part X.
This definition establishes that the regular rate
, which serves as the basis for many calculations (e.g., overtime pay and public holiday entitlements, and what constitutes a week of lay-off for termination and severance purposes) under the Act, is the rate of pay for each non-overtime hour of work. In a decision under the former Employment Standards Act, the referee held that an agreement that incorporates a component for overtime premiums into the regular rate of pay is of no effect since it is inconsistent with the provisions of the Act and does not excuse an employer from calculating and paying overtime in accordance with the number of hours worked in excess of the statutory overtime threshold of 44 hours - see Wen-Hal Limited v Hansen (August 22, 1979), ESC 660 (MacDowell).
Under this definition, an employee’s regular rate will be:
This definition establishes that regular wages, which serves as the basis for the calculations of public holiday pay in ESA Part X, s. 24(1) and termination pay and severance pay entitlements in ESA Part XV, ss. 60(1), (2) and ss. 65(1),(5), (6), includes all wages except:
Note that premium pay is defined in ESA Part I, s. 1 to mean an employee’s entitlement for working on a public holiday as described in ESA Part X, s. 24(2). It does not mean, for example, a premium rate of pay of an extra 50 cents an hour that an employee earns under an employment contract for working the weekend shift. Such monies owing would be included in the definition of regular wages.
This provision provides that where an employee usually works the same numbers of hours each day, that number of hours is the employee’s regular work day
. An employee does not have to work the same number of hours every work day for there to be a regular work day, just so long as they regularly and ordinarily work that number of hours.
The term regular work day appears in ESA Part VI, s. 15(3) with respect to an exception to the requirement for employers to record the number of hours worked by each employee in each day and week, and in ESA Part VII, s. 17(1) with respect to the daily limits on hours of work. If an employee does not usually work the same number of hours each day, they will not have a regular work day for the purposes of s. 15(3) or s. 17(1).
For further information see the overtime hour definition in ESA Part I, s. 1.
The term regular work week appears in ESA Part VI, s. 15(3) with respect to an exception to the requirement for employers to record the number of hours worked by each employee in each day and each week, in ESA Part XI, s. 33(3) with respect to the calculation of the number of single vacation days to which an employee is entitled, and in ESA Part XI, s. 34(2) with respect to the calculation of the number of vacation days earned during a stub period. In addition, it appears in the provisions that specify what constitutes a week of lay-off for termination and severance purposes in ESA Part XV, ss. 56(3)-(3.6) and ss. 63(2)-(2.4), as well as the provisions for the calculation of termination pay and severance pay entitlements in ESA Part XV, ss. 60(1), (2) and ss. 65(1), (5), (6). In this regard, also see the discussion of the work week in this section.
In Stewart Warner Corporation of Canada Limited v Employees (April 25, 1983), ESC 1406 (Egan), Referee Egan distinguished work week from a regular work week as referred to in s. 57(13)(b)(i) (then s. 40(6)(b)(i) of the former Employment Standards Act, which is substantially the same as s. 60(1)(b) of the ESA 2000). In that case, the employer had temporarily cut the shifts from five per week to three per week just prior to terminating the employees.
In calculating termination pay owing to the employees, the employer had claimed that the regular work week consisted of three shifts. The referee disagreed, stating that the reduction in shifts was anticipated to be a temporary measure only and that the regular work week still consisted of five shifts in each work week. As a consequence, termination pay in lieu of notice had to be the pay the employee would have received had he been working five shifts per week.
This definition states that regulations
as referred to in the Act refers to regulations made under the ESA 2000.
The authority to make regulations generally originates from the Legislation Act, 2006, SO 2006, c 21, Sch F. Section 17 of the Legislation Act, 2006 states:
The authority to make regulations under the ESA 2000is found in ESA Part XXVII, s. 141.
In accordance with s. 22(2) of the Legislation Act, 2006, regulations come into force on the day on which the regulation is filed unless otherwise stated in the regulation or in the Act under which the regulation is made.
Section 25(1) of the Legislation Act, 2006 further provides that regulations must be published on the e-Laws website promptly after their filing and in The Ontario Gazette within one month of filing or in accordance with another timeline that may be specified a regulation made by the Attorney General. A regulation that is not published is not effective against a person who has not had actual notice of it.
This definition was introduced by the Fairness for Military Families Act (Employment Standards and Health Insurance), 2007, SO 2007, c 16, in the creation of Reservist Leave.
A reservist is defined to mean a member of the reserve force of the Canadian Forces referred to in s. 15(3) of the federal National Defence Act, RSC 1985, c N-5, which states:
For further details, refer to ESA Part XIV, s. 50.2.
This definition was introduced by the Government Efficiency Act, 2002, effective November 26, 2002. The definition provides that standard vacation entitlement year
is a recurring 12-month period that begins on a date that is the date of an employee’s first day of employment.
For further details, refer to ESA Part XI.
Statutory notice period
is the period equal to the length of notice to which the employee is entitled under the Act. Where more notice is given than is required by the Act, the statutory notice period is the last part of the longer notice that is given. For example, if an employee was entitled under the Act to eight weeks' notice but was given 12 weeks' notice, it is the last eight weeks of the 12-week period, not the first eight weeks, that constitute the statutory notice period.
The definition becomes relevant for determining the timing of employees' statutory entitlements in situations where an employer has given a longer period of notice than it is required to give under the Act. For example, employees are to receive their full pay during the statutory notice period, even if no work is available. If an employee entitled to eight weeks' notice of termination was given 10 weeks' notice and was sent home in the ninth week due to lack of work, the employee would entitled to be paid during the ninth and tenth week, notwithstanding that they did not work, because the statutory notice period was the last eight weeks of the 10 weeks' notice.
Another example comes from ESA Part XV, s. 63(1)(e) and s. 63(3). Under those sections, an employee who receives notice of termination and then subsequently resigns is entitled to severance pay if they gives their employer at least two weeks' notice of the resignation and the notice of resignation takes effect during the statutory notice period, assuming that the other qualifying criteria for severance pay are met. If an employee was entitled under the Act to eight weeks' notice but was given 12 weeks' notice by the employer, the employee’s resignation must take effect some time during the last eight weeks of the 12-week notice period in order for the employee to be entitled to severance pay. If the employee’s resignation takes effect some time during the first four weeks of the 12-week notice period, the employee will not be entitled to severance pay.
This definition was introduced by the Government Efficiency Act, 2002, effective November 26, 2002.
The definition sets out what a stub period
, as referred to in ESA Part XI Vacation with Pay, means.
For details, refer to ESA Part XI.
A temporary help agency
is defined as an employer (also see the definition of employer
in s. 1 of the Act) that employs persons for the purposes of assigning them to perform work on a temporary basis for clients of the employer. In other words, a temporary help agency is defined by the fact that it employs assignment employees
for the purposes of assigning them to perform work for its clients.
One question that has arisen is whether employers such as management consulting firms or security companies whose employees perform work for clients of the employer are operating a temporary help agency.
The definition of temporary help agency provides that the agency must employ persons for the purpose of assigning them to perform work on a temporary basis for clients
. The client is defined in relation to a temporary help agency as an entity that enters into an arrangement with the agency under which the agency agrees to assign or attempt to assign one or more of its employees to perform work
on a temporary basis for that entity.
Determinations as to whether a particular employer is a temporary help agency or not would of course depend on all the facts in any given situation.
As an example, although a security company’s employees may work on a client’s premises, it is possible that company is not operating as a temporary help agency as that term is defined in s. 1.
One consideration would be whether the company can be said to be hiring employees to provide the company’s services to clients rather than for the purposes of performing work for a client. A related consideration would be whether the contract or agreement with the client is to provide certain services for the client rather than an agreement to assign one or more of its assignment employees to perform work for the client. Such an arrangement may be indicated where the work done by the employees is under the control and direction of the company rather than the client. Again, a determination as to whether an employer is, or is not, a temporary help agency would depend on all of the facts.
This section, subject to certain exceptions, requires temporary help agencies to provide an assignment employee with one week’s notice or pay in lieu if an assignment that was estimated to last for three months or more is terminated before the end of its estimated term unless another assignment lasting at least one week is offered to the employee.
For further discussion, please refer to ESA Part XVIII.1, s. 74.10.1.
Payments voluntarily made to or left for an employee by a customer include but are not limited to: money left on a table or bar for a server; money given to a receptionist as a tip for a hair stylist; money left in a hotel room for cleaning staff, etc.
The test for determining whether a payment made voluntarily is a tip or other gratuity is: would a reasonable person be likely to infer that the customer intended or assumed that the payment would be kept by the employee or shared by the employee with other employees (i.e., as part of a tip pool)?
It is generally understood that the reasonable person standard is to be determined on an objective, rational and informed basis. Whether the circumstances are such that a reasonable person would be likely to infer that the customer intended or assumed that the payment would be kept or shared by the employee(s) will depend on the facts of a matter.
The questions to be asked are: How would a reasonable person interpret the situation when the customer made or left the voluntary payment? Are the circumstances such that a reasonable person would be likely to infer that the customer intended or assumed that the payment would be kept or shared by the employee(s)?
Payments voluntarily made to an employer by a customer include but are not limited to: a tip added by a customer on to a debit or credit card payment; cash given to an employer that the customer says is for the employee; money left in a tip jar, etc.
The test for determining whether a payment made voluntarily to an employer by a customer is a tip or other gratuity is: would a reasonable person be likely to infer that the customer intended or assumed that the payment would redistributed to an employee or employees (i.e., as part of a tip pool)? Whether the circumstances are such that a reasonable person would be likely to infer that the customer intended or assumed that the payment would be redistributed to an employee(s) will depend on the facts of a matter.
The questions to be asked are: How would a reasonable person interpret the situation when the customer made or left the voluntary payment? Are the circumstances such that a reasonable person would be likely to infer that the customer intended or assumed that the payment would be redistributed to an employee or employee(s)?
Service charges or similar charges imposed by an employer on a customer include but are not limited to: gratuity or service fees charged by caterers, banquet halls, reception halls and convention halls; automatic service charges imposed upon groups of certain sizes in restaurants, etc.
The test for determining whether a service charge or similar charge imposed by an employer on a customer is a tip or other gratuity is: would a reasonable person be likely to infer that the customer intended or assumed that the payment would be redistributed to an employee or employees (i.e., as part of a tip pool)? Whether the circumstances are such that a reasonable person would be likely to infer that the customer intended or assumed that the payment would be redistributed to an employee or employee(s) will depend on the facts of a matter.
The questions to be asked are: How would a reasonable person interpret the situation when the customer made the payment? Are the circumstances such that a reasonable person would be likely to infer that the customer intended or assumed that the payment would be redistributed to an employee or employee(s)?
For example, if a banquet hall service contract or catering bill explicitly specifies a certain amount as a gratuity
and another amount as an administrative fee
, a reasonable person would likely infer that the customer intended or assumed that only the amount specified as a gratuity
would be redistributed to the employee(s). Conversely, a reasonable person would likely infer that the customer did not intend or assume that the administrative fee would be redistributed by the banquet hall or catering company to the employee(s).
The Ontario High Court in Shabinsky v Horwitz et al, 1971 CanLII 729 (ON SC) held that where an employer charged the hotel customer an additional 15 per cent for gratuities, it was understood by the customer, employee and employer that this charge amounted to a tip for the employees because the customers were deliberately given the impression they were paying into a fund for gratuities in lieu of individual tips and paid for them by that purpose.
This provides for the power to make regulations to include other payments in the definition of tip or other gratuity. At the time of publication, no such payments are prescribed.
This provides for the power to make regulations to exclude certain payments from the definition of tip or other gratuity. At the time of publication, no such payments are prescribed.
This provides for the power to make regulations to exclude all or part of charges relating to the method of payment used from the definition of tip or other gratuity.
O Reg 125/16 prescribes that a portion of credit card processing fees are excluded from the definition of tip or other gratuity
under ESA Part I, s. 1. A tip or other gratuity does not include the portion of a service charge or similar charge imposed by a credit card company on an employer for processing a credit card payment made to the employer by a customer. The portion of the charge that is excluded from the definition is determined by multiplying the total amount of the tip or other gratuity by the greater of:
This definition sets out the broad scope of the phrase trade union
. The definition covers organizations representing employee interests, whether or not they are called a trade union, under one of the above statutes.
This definition is necessary because the ESA 2000 recognizes the agency status of trade unions in certain circumstances. For example, under ESA Part III, ss. 6 and 7, settlements and agreements or authorizations made by a trade union on an employee’s behalf are binding.
Section 1(1) of the LRA 1995 provides:
Although the Crown Employees Collective Bargaining Act, 1993, SO 1993, c 38 (CECBA
) does not contain a definition of trade union, that term has the same meaning in CECBA as it does in the Labour Relations Act, 1995 as a result of the referential incorporation of the Labour Relations Act, 1995 (with some modifications) and its definitions.
The Education Act, RSO 1990, c E.2 provides as follows:
Bargaining agent
is not defined in the Fire Protection and Prevention Act, 1997, SO 1997, c 4 (FPPA
), although ss. 46(1) and (2) of the FPPA provide as follows:
As per s. 41(1) of the FPPA, a firefighter, for the purposes of defining a bargaining unit under the FPPA, means a person regularly employed on a salaried basis in a fire department and assigned to fire protection services and includes technicians but does not include a volunteer firefighter
. In addition, s. 41(2) of the FPPA states that managers are deemed not to be firefighters for the purposes of defining a bargaining unit.
The Colleges Collective Bargaining Act, 2008, SO 2008, c 15 provides as follows:
As of the time of writing, no other Acts have been prescribed.
This definition was introduced by the Government Efficiency Act, 2002, effective November 26, 2002.
The definition provides that vacation entitlement year
means an alternative vacation entitlement year or a standard vacation entitlement year. Both of these terms are defined in ESA Part I, s. 1.
For further details, refer to ESA Part XI.
This provision defines what are and what are not wages for the purposes of the ESA 2000. According to this definition:
This would include regular wages, whether the employee is paid on an hourly or salaried basis, or through commissions or piece work payments. It would also include any other monetary compensation to which the employee is entitled under their contract.
This includes payments where work is not performed, such as vacation pay, public holiday pay, personal emergency leave pay, domestic or sexual violence leave pay, termination pay and severance pay.
O Reg 285/01 prescribes maximum amounts at which room and board can be valued for purposes of determining whether an employer has paid at least the minimum wage to an employee; such amounts are considered to be wages under the definition. Note, however, that where the employee is, say, entitled to receive an allowance for room or board that exceeds the amount prescribed in the regulation, that higher amount is considered to be wages for purposes other than determining compliance with the minimum wage requirements. For example, if the employee is provided with an allowance of $75 a week for meals, only $53.55 could be counted towards the employer’s minimum wage obligation, but all $75 is considered to be wages, and could be taken into account, for example, in determining the employee’s termination pay entitlement in the event of termination without notice.
Note also that since s. 5(4) of O Reg 285/01, which sets out the maximum allowances for room and board, does so for the sole purpose of determining if the minimum wage requirements in the Act have been met, the maximum allowances do not apply to employees who are exempt from the minimum wage provisions in ESA Part IX. One example of such employees is superintendents, janitors and caretakers of a residential building who reside in the building. Therefore, where, pursuant to a contract of employment, an apartment superintendent occupies without charge an apartment at an agreed value of, for example, $400/month, an amount that, incidentally, exceeds the maximum allowances under O Reg 285/01, that amount will be considered to be part of their wages. Note that if the value had not been agreed upon, the true value, i.e., the rent the employer would have otherwise received for the premises, would be included in the calculation of the wages paid to the employee.
is an award of the [employee’s] labour, generally known as an incentive bonus.
Such as sales commissions based on the employee’s productivity - see Tim Wilkins Pontiac Buick Ltd. d.b.a. Lorne Brett Motors Ltd. v Ojamae et al (October 2, 1980), ESC 878 (Davis), a decision under the former Employment Standards Act. Note, however, that in Winfield Reas Estate Limited v Rajani (May 7, 1978), ESC 610 (Brent) where the employee, a real estate agent, received 100 per cent commission for the sale of her own house, this representing an additional 30 per cent compared to what she normally earned, the referee held that the making of this arrangement was discretionary on the part of the employer and was not related to hours, production or efficiency. He concluded that this arrangement, therefore, satisfies the double test in paragraph (b) of the definition under the former Employment Standards Act excluding the sum from wages. This part of the definition of wages under the former Employment Standards Act is substantially the same as paragraph (e) of the definition in the ESA 2000.
Where profit-sharing is included in the contract of employment and does not depend on the discretion of the employer, any monetary remuneration earned under the profit-sharing plan will be considered to be wages. For example, see the profit-sharing bonus agreements in Tim Wilkins Pontiac Buick Ltd. d.b.a. Lorne Brett Motors Ltd. v Ojamae et al and Bayside Kenworth Limited v Havelin (April 11, 1983), ESC 1409 (Aggarwal), both decisions under the former Employment Standards Act.
Such as a sales contest that is intended to serve as an incentive to employees to stimulate sales, productivity, etc. The contest becomes part of the contract of employment and consequently any monetary remuneration earned pursuant to the contest is part of wages - see Square Court Investments Limited o/a Bay & Lada v Poplawski (April 5, 1983), ESC 1390 (Davis), a decision under the former Employment Standards Act.
For example, neither stocks nor stock options (whether the stocks are subsequently sold or the stock options exercised) are considered to be wages because they are not monetary remuneration at the time they are given to the employee. It should be noted that dividends are also not considered to be wages. An employee, as part of their employment contract may be offered shares in the company and as a result of ownership of these shares, the employee may receive dividends but would do so in their capacity as a shareholder and not in their capacity as an employee.
Tips or other gratuities, whether they are: received by employees directly or indirectly from a customer of the employees' employer; service charges or similar charges imposed by an employer upon the employer’s customer; or a portion of a redistribution of tips, commonly known as a tip pool. For more information on tips or other gratuities, see ESA Part 1, s. 1.
For example, this would include Christmas bonuses, suggestion or patent awards, and profit-sharing plans where the amount to be paid is determined independent of hours, production or efficiency of employees.
This does not include remuneration for hours spent travelling where that is part of work time - see O Reg 285/01, s. 1.1 for examples of travel time that does and does not count as hours of work.
For example, when the employer provides the employee with money to pay for, or reimburses the employee for, the expenses that they incurred for such things as food, gas, hotel room, laundry, etc.
This includes plans like Blue Cross, dental plans, sick pay plans, etc., whether they are provided by a third-party insurer or are part of an employer-funded plan.
Note that the termination and severance provisions in ESA Part XV, ss. 60(3) and 62(2) deem employer contributions to benefit plans to be wages in the circumstances described in those sections.
This definition clarifies the meaning of the term work week
, which appears in various sections throughout the Act.
A work week is the period of seven consecutive days within which the employer, through custom or practice, normally schedules work. If the employer has not established such a period, work week will be from Sunday to Saturday.
Subsection 1(2) clarifies that “assigned to perform work” includes an assignment to receive training from a client of the agency for the purposes of performing work for the client.
For more detail, see the “assignment employee” section in the definition of “employee” in Part I, s. 1.
In the case of many employment standards established by the Act, the standard consists of an entitlement on the part of an employee or a prohibition applicable to an employer (the default standard), together with a provision that permits the employer and the employee to agree (in writing or in electronic form) that some other entitlement or protection will apply instead. For example, agreements can be made:
Section 1(3) provides that these agreements must be in writing. The written requirement is satisfied if the agreement is in electronic form, as per s. 1(3.1), unless otherwise stipulated. One example of a provision where it is otherwise stipulated is ESA Part VII, s. 20(2), which allows employers and employees to agree, whether or not in writing, that the required 30-minute meal break be broken into two shorter periods that total 30 minutes. See also ESA Part XIV, s. 52.1(1)(b) and ESA Part XVIII.1, s. 74.3) for further examples of where agreements are not required to be in writing.
It is the Program’s position that where the Act allows the parties to do something other than what the Act would otherwise require if they agree in writing, and the parties make the agreement but fail to put it in writing, then the agreement is ineffective and the Act’s usual rule would apply. In other words, where the Act requires agreements in writing, there is no mechanism for opting for the alternate standard in the absence of a written agreement and the default standard will therefore apply. For example, a verbal agreement to average overtime will not allow for averaging - even in the face of the parties' acknowledgement that there was a verbal agreement to average overtime.
Having agreements in writing serves several valuable purposes:
Several issues can arise regarding the validity of agreements that can be made under the Act. These include:
These issues are dealt with generally below. Also see the discussion under each provision that provides for agreements for more specific information.
Agreements are generally effective only with respect to events that take place after the agreement is made. To the extent that an agreement purports to have a retroactive effect, it will not be valid, even if the employee has agreed to make it retroactive.
For example, an employee has been working 50 hours a week since their date of hire on October 1, 2001, but there is no written agreement allowing these excess hours to be worked. On December 1, 2001, the employer and employee agree in writing that the employee will work 50 hours a week. They further agree in writing that the agreement to work excess hours applies retroactively to October 1, either by explicitly stating so in the agreement or by backdating the agreement to October 1. It is Program policy that the agreement applies only from the date it was actually entered into - in this case, December 1 - onward. The agreement will not have the effect of undoing the hours of work violations that occurred between October 1 and December 1, even though the employee has agreed that it would have this retroactive effect.
To allow agreements to have retroactive effect would compromise the intent of the Act. The basic premise of the Act is that the default standards exist unless and until employees and employers agree to suspend them. The provisions of the Act do not contemplate parties being able to retroactively nullify, through their agreements, violations of the Act that have already occurred; they merely allow employers and employees to agree upon a future state of affairs.
This policy against retroactivity is consistent with the approach taken by the Director of Employment Standards when giving averaging approvals or approving permits to work excess hours under the former Employment Standards Act. Not recognizing a retroactive application was upheld under the former Employment Standards Act where the referee in 750338 Ontario Inc. o/a Hillside Foods v Handley (March 20, 1990), ESC 2645 (Haefling) held:
[T]o put the matter another way, apart from the facts just outlined, the finding and conclusion I reach in this case is that no legal or binding effect can be given to a written authorization signed after the event, as occurred here, since the result would plainly serve to defeat the clear purpose and intention of the legislation.
In very limited circumstances, however, an agreement may be permitted to have a retroactive effect. For example, an employee is off sick. The employee is subsequently advised that the sick day will be unpaid. They want to take that day off as a paid vacation day, so, pursuant to ESA Part XI, s. 35, they make a written request to do so, and the employer agrees to allow this in writing. The Program’s view is that in this situation, the agreement may be permitted because the employee does not lose any entitlements as a result of recognizing a retroactive application of the agreement. The employee was entitled to a vacation day and received the vacation day.
This can be contrasted to a situation where the employee enters into an agreement to retroactively allow for overtime averaging. In this case, the employee has earned overtime prior to entering into the agreement. In giving the agreement retroactive effect, the employee loses an entitlement already earned under the Act.
Signatures are usually the best evidence to establish that both parties intended to enter into the agreement. In the absence of signatures, the party seeking to enforce the agreement must provide other evidence of the parties' intent to enter into the agreement.
Where the employer has not signed the agreement, the employer’s intent to enter into it may be established by the fact it drafted the agreement, or by the fact that the agreement is drafted on company letterhead. Where the employee has not signed the agreement, their intent to enter into the agreement may be established through evidence such as oral confirmation to the Officer, or through other documents the employee signed in hardcopy or electronically or sent electronically. More detail on the enforceability of electronic signatures is below in the section on electronic agreements..
The terms of any agreement must be sufficiently certain in order to be enforceable; agreements must clearly and explicitly set out what is being agreed upon. For example, parties drawing up overtime averaging agreements under ESA Part VIII, s. 22(2) should specify that the purpose of the averaging is to calculate the employee’s entitlement, if any, to overtime pay. See ESA Part VIII, s. 22 for more detailed information on the requirements for averaging agreements. If one of the parties drafted the agreement, and a particular term is ambiguous and the parties disagree about what the term means, the term will be construed against the parties who drafted the agreement - this is called the contra proferentem rule.
Similarly, parties entering into agreements to work hours in excess of those limits contained in ESA Part VII, s. 17 should state that the employee is agreeing to work in excess of eight hours a day or a longer established regular day and/or 48 hours a week, and it should state the specific number of hours up to which the employee is agreeing to work, up to a maximum of 60. This type of agreement should avoid using the word overtime, because overtime is not the same as excess hours. And because the general overtime threshold of 44 hours is different than the general hours of work limits of eight hours a day or a longer regular day established by the employer and 48 hours in a week, an employee could agree to work overtime, i.e., hours in excess of 44 in a week, without necessarily having agreed to work more than 48 hours in a week or more than eight hours in a day or a longer established regular day. See ESA Part VII, s. 17(3) for more detailed information on the requirements for agreements to work excess hours.
An agreement will not be invalid only because it used the wrong term to describe the employment standard, as long it is clear from the context of the agreement that both parties knew exactly what was being agreed to. For example, an agreement to delay the scheduling of a substitute holiday beyond the default three-month deadline might state that the employee agrees to delay for six months the taking of their extra vacation day they earned for working on Canada Day. While the incorrect term was used - vacation day rather than substitute day - it is clear what the parties intended and the agreement would meet the specificity requirement.
This approach to the issue of specificity is consistent with several court and arbitration cases decided under the former Employment Standards Act. For example, see:
if such consent or agreement relates specifically to the performance of work by employees beyond the normal statutory legal limits.
On our reading of McLeod v Egan and Re Walker Exhausts, the courts have ruled that the language relied upon as constituting consent or agreement must evidence a clear intent to relinquish the statutory right of affected employees to refuse work beyond the statutory maximum. This intent may be evidenced by reference to the statute or to the permit or to the specific hours beyond the statutory maximum that are compulsory. Language that simply makes overtime compulsory, where either the daily or weekly hours of work are less than the statutory maximum, is not sufficiently specific and, therefore, is equivocal with respect to whether the intent was to give up the statutory right to refuse work beyond the statutory maximum.
In essence, an agreement should be specific and clear enough for an independent, objective third party to know what was being agreed to simply by reading it.
In the absence of informed consent by one of the parties to the agreement, an agreement is invalid. Informed consent will not be established unless each party knows precisely the ramifications of entering into the agreement.
The best evidence that an employee provided their informed consent is where the agreement itself accurately sets out the consequences of the agreement. If the agreement does not provide that information, informed consent can be demonstrated through other means (e.g., the employee was provided with or obtained an ESA 2000 fact sheet or contacted the Ministry of Labour).
Some examples of where there may be an absence of informed consent include:
Officers are not required in every case to undertake a review of whether informed consent was provided by each party to a purported agreement. Officers may assume that there is informed consent, but if something comes to their attention that would contradict this assumption then a review of the conduct of the parties may be undertaken.
Agreements may be invalid if a party to the agreement has not voluntarily and freely consented to being bound by its provisions.
In Cardinal Transportation B.C. Inc. v Canadian Union of Public Employees, Local 561 (1996), 34 CLRBR (2d) 1 (BC LRB), the British Columbia Labour Relations Board defined coercion
as follows:
In the labour relations context, coercion
connotes any effort by an employer to invoke some form of force, threat, undue pressure or compulsion for the purpose of controlling or influencing an employee’s [decision].
The Ontario Labour Relations Board has also considered the meaning to be attributed to the term coercion in a case where the applicant sought to set aside a settlement made pursuant to ESA Part XXIII, s. 112. The Board cited with approval a decision of the Board in the labour relations context, noting with approval the discussion therein regarding duress, coercion and the requirement that agreements be entered into freely. See Watkins v The Public Services Health and Safety Association, 2015 CanLII 69408 (ON LRB). The discussion in this decision would also be applicable to s. 120 settlements.
There will always be some reason for a party to enter into an agreement. The issue is which reasons are unacceptable, such that they will render the agreement invalid.
Unacceptable reasons include where an employer:
Note that these actions may also amount to a violation of ESA Part XVIII, s. 74 which prohibits reprisals.
For example, an agreement would not be effective if the reason the employee entered it is because the employer:
On the other hand, it is unlikely that the reason will be considered to be unacceptable where an employee agrees to an arrangement merely to please their employer, to avoid displeasing them, or because they wanted to earn extra money.
Section 1(3.1) sets out that electronic agreements can constitute an agreement in writing under the ESA 2000.
The Courts have recognized that electronic contracts may be binding on the parties that entered into them. See for example Rudder v Microsoft Corp., 1999 CanLII 14923 (ON SC) where the court ruled that an individual was bound to an Internet service providing contract by clicking the I agree
button that appeared on the user’s computer monitor. However, the courts have also ruled that it is essential that electronic contracts retain their original form and that there are mechanisms provided to ensure their integrity (i.e., safeguards to ensure that the parties have actually entered into the agreement, such as passwords).
Consequently, electronic agreements can be valid agreements under the Act, assuming all of the conditions of a valid agreement are met, e.g., specificity, informed consent, etc. However, precautions must be taken to ensure the integrity of electronic agreements. In particular, officers must be able to verify that the employee whom the employer claims to have electronically agreed to the agreement did in fact agree.
There must be a positive act by the employee to demonstrate their agreement; simply not responding to an e-mail that says, for example, if you don’t respond, you will be considered to have agreed to . . .
does not constitute an agreement.
Officers are not required in every case involving an electronic agreement to verify the integrity of the agreement. Officers may assume that the agreement is as it appears to be, but if something comes to their attention that would contradict this assumption then the officer has to decide whether what has been placed before them does in fact accurately represent what the parties agreed to, on the basis of the evidence.
The enforceability of a party’s electronic signature requires proof that the party actually affixed its electronic signature to the agreement, and also intended to be bound by the terms and conditions of the agreement. There are many ways to sign a document electronically.
In accordance with the general principles discussed earlier regarding the validity of agreements, items that parties may wish to consider including in their electronic agreements include:
In addition:
Different types of agreements may have specific requirements. Please refer to the appropriate section of the ESA 2000 for more information.
Some of the provisions for agreements within the Act and regulations set out specific restrictions or limitations on the ability of the parties to revoke the agreement. For example, agreements to average hours of work for the purpose of determining overtime entitlements may not be revoked before the agreement expires unless both the employee and employer agree to revoke it as per ESA Part VIII, s. 22(6). Likewise, in general, where there is an agreement for an employee to work up to a specified number of hours in excess of the weekly 48 hour maximum, an employee is only able to revoke such an agreement after giving the employer two weeks' written notice and an employer is only able to revoke after giving the employee reasonable notice.
Where the Act does not impose any restrictions on revocability, employees are entitled to revoke their agreement to the alternate standard and revert back to the default standard, and doing so is a protected activity under ESA Part XVIII, s. 74. If an employer penalizes an employee because the employee withdrew their agreement, that will be a violation of s. 74. See Part XVIII for additional discussion on this point.
It provides that s. 1(3), which requires that agreements that employees and employers enter into under the Act be in writing, does not mean that employment contracts that are not collective agreements have to be in writing.
Part II (Information Concerning Rights and Obligations) of the ESA 2000 contains provisions dealing with the requirement that employers provide a copy of a poster prepared by the Director of Employment Standards to each of the employer's employees. The poster provides such information about the ESA 2000 and the regulations as the Director considers appropriate.
This Part is intended to help ensure that employers are aware of their obligations and that employees know their rights under the ESA 2000. It requires that important information about the ESA 2000 and the regulations be provided directly to employees.
Section 2(1) provides that the Director of Employment Standards shall prepare and publish a poster that provides information about the ESA and its regulations that the Director considers appropriate.
At the time of writing, the poster prepared pursuant to this section is entitled Employment Standards in Ontario
and is published by Publications Ontario. The poster is available from Publications Ontario and can be downloaded from the Ministry of Labour’s website.
Prior to the Restoring Ontario’s Competitiveness Act, 2019, which received Royal Assent on April 3, 2019, s. 2(1) required the Minister of Labour to prepare and publish the poster.
This section provides that the Director of Employment Standards shall prepare and publish a new poster if the Director believes that the existing poster is out of date.
Subsection 2(3) was repealed effective April 3, 2019 as a result of the Restoring Ontario’s Competitiveness Act, 2019. Prior to April 3, 2019, employers were required to post the most recent version of the poster in at least one conspicuous place in every workplace. The discussion of this provision is being maintained in this publication since employees may still have a complaint relating to a situation that arose when s. 2(3) was in force.
This section requires employers to post a copy of the poster referred to in s. 2(1) in the workplace where it is likely to come to the attention of all employees.
Subsection 2(4) was repealed effective April 3, 2019 as a result of the Restoring Ontario’s Competitiveness Act, 2019. Prior to April 3, 2019, employers were required — in particular circumstances — to post a translation of the most recent version of the poster in at least one conspicuous place in every workplace. The discussion of this provision is being maintained in this publication since employees may still have a complaint relating to a situation that arose when s. 2(4) was in force.
This section states that where the majority language in a workplace is a language other than English, the employer is required to inquire as to whether the Minister has prepared a translation of the poster into that language. If a translation of the poster into that language has been prepared, the employer is required to post the translation alongside the English poster.
The requirement that an employer provide each employee with a copy of the most recent version of the poster came into effect May 20, 2015 as a result of the Stronger Workplaces for a Stronger Economy Act, 2014.
Pursuant to ss. 2(7), the poster must be provided within 30 days of the day the employee became an employee of the employer.
Employers are only required to provide each employee with the poster once. There is no requirement to provide employees with the poster every time a new version of the poster is published by the Director. The Program's position is that an employer may provide the poster as a printed copy or as an attachment in an email to the employee. Further, and consistent with the Program's position regarding the provision of written wage statements under s. 12(1) and the information sheets for assignment employees under s. 74.7(3), an employer may provide the poster via a link to the document on an internet database, if the employer ensures the employee has reasonable access to that database (i.e. the employer must ensure the employee has access to a computer (which includes devices such as tablets and smart phones) and is able to access a working link to the document) and ensures the employee has access to a printer and that the employee knows how to use the computer and the printer.
If an employee asks for a copy of the poster in a language other than English, the employer is required to inquire as to whether the Director has prepared a translation of the poster into that language. If one has been prepared, the employer is required to provide the employee with a copy of the translation. Note this translation must be provided in addition to a copy in English.
Subsection (7) requires the employer to provide an employee with a copy of the most recent version of the poster within 30 days of the day the employee is hired by the employer.
Subsection (8) is a transitional provision. This provision establishes that the poster that was in place immediately before the day the Restoring Ontario’s Competitiveness Act, 2019 received Royal Assent continues to be the correct version of the poster for the purposes of section 2 until such time as the Director prepares and publishes a new version of the poster under subsection 2(2).
Subsection (9) is a transitional provision. This provision establishes that translated versions of the poster in place immediately before the day the Restoring Ontario’s Competitiveness Act, 2019 received Royal Assent continue to be the correct translated versions of the poster for the purposes of section 2 until such time as the Director prepares new translations of a new poster.
Part III (How this Act Applies) contains provisions dealing with the application of the Employment Standards Act, 2000 and sets out some basic matters that are critical to its operation.
Section 3(1)(a) indicates that the Employment Standards Act, 2000 applies to all employees whose work is to be performed in Ontario and their employers. However, the fact that some work is performed in Ontario may be insufficient to bring the employee in under the jurisdiction of the ESA 2000. For example, if the employee's work in Ontario is merely a continuation of the work performed in another jurisdiction, then the laws of the other jurisdiction may apply rather than the ESA 2000.
Section 3(1)(b) provides that the Act applies to employees whose work is to be performed in Ontario and who also perform work outside of Ontario but only where the work is a continuation of the work performed in Ontario.
It should also be noted that, in some situations, there might very well be dual jurisdiction over the matter. For example, a person may be performing work in Newfoundland as a continuation of the work in Ontario, and Ontario would have jurisdiction over the contract of employment, notwithstanding that Newfoundland may have as well.
Factors that are not relevant to the Act's application include where:
In Shearing v James Way Construction Inc., 2007 CanLII 15197 (ON LRB), the issue was whether the overtime provisions of ESA 2000 applied to work performed in the United States. The employee worked building fast food outlets for a construction business that was based in Kitchener. Occasionally, the employer sent the employee with a loaded truck of building materials to the United States to build similar outlets there, following which the employee would return to Ontario to resume his duties. The Board found that the employee’s work in the United States was a continuation of his work in Ontario within the meaning of s. 3(1)(b) and that the overtime provisions applied.
In Karpowicz v Valor Inc., 2016 CanLII 49203 (ON LRB), the Board considered whether the ESA 2000 applied to an employee who performed almost all of his work in the U.S. for an employer with headquarters in Ontario. The employment contract stated that the parties wanted to laws of Ontario, including the ESA 2000, to apply to their employment relationship. However, the employee was based in Michigan, where he performed almost all of his work, even the work that related to clients based in Ontario. He came to Ontario on a few occasions to attend meetings, but the Board determined that this was incidental to his work in Michigan and constituted a continuation of his work outside of Ontario. The Board gave little weight to the intention of the parties and found that the ESA 2000 did not apply because s. 3(1)(b) was inapplicable.
This provision, introduced by the ESA 2000, clarifies that the ESA 2000 does not apply to employees and employers that are federally regulated and who are therefore subject to the Canada Labour Code rather than the ESA 2000. Section 3(2) codifies the common law and the Program policy applied under the former Employment Standards Act.
Section 2 of the Canada Labour Code provides a definition of “federal work, undertaking or business” which fall under federal jurisdiction:
However, despite this definition it is not always clear whether an employer is federally or provincially regulated. Generally, it should be presumed that employment standards are provincially regulated, and therefore fall within the jurisdiction of the ESA 2000. If it is unclear whether an employer is provincially or federally regulated, it is recommend that guidance be sought. Additionally, see the sections below for further information on federal vs provincial jurisdiction in employment.
In Canada, law-making functions are divided between the Parliament of Canada and the provincial legislatures by the Constitution Act, 1867 (formerly called the British North America Act). Section 91 of the Constitution Act, 1867 assigned to the federal government a residual authority to make laws concerning the Peace, Order and Good Government of Canada
(referred to as the "POGG power"). The courts have determined that such matters as aeronautics, radio and television broadcasting are within federal jurisdiction under this clause. In addition, s. 91 sets out 31 classes of exclusive federal power. These include such matters as unemployment insurance, the military, criminal law and divorce. Finally, pursuant to s. 91(29), Parliament may make laws concerning any classes of works or undertakings expressly excepted from the subjects assigned to provincial jurisdiction in s. 92.
Section 92 of the Constitution Act, 1867 assigns jurisdiction to the provinces over such subjects as provincial taxation, municipal institutions within the province, property and civil rights in the province, and the administration of provincial courts. It also establishes exceptions from provincial jurisdiction in ss. 92(10)(a)-(c) for local works or undertakings that connect provinces or extend beyond the province, steamship lines between a province and a foreign country, and those undertakings that are declared to be of national interest. Note that the combined effect of s. 91(29) and s. 92(10)(a) is to provide Parliament with jurisdiction over interprovincial transportation and communications works and undertakings, and the combined effect of s. 91(29) and s. 92(10)(c) is to allow the federal government to declare its jurisdiction over grain elevators and various kinds of mills and warehouses.
As a general rule, the regulation of labour relations and working conditions (which includes employment standards) falls within provincial jurisdiction pursuant to the province's constitutional authority over Property and Civil Rights in the Province
, as per s. 92(13) of the Constitution Act, 1867.
It should be noted that notwithstanding this general rule, Parliament has jurisdiction over labour relations and working conditions when such jurisdiction is an integral part of Parliament's jurisdiction over an area of primary federal authority.
The constitutional principles that have been applied in determining whether Parliament has jurisdiction over employment and labour matters were reviewed by the Supreme Court of Canada in Northern Telecom v Communications Workers, [1980] 1 SCR 115, 1979 CanLII 3 (SCC) and summarized as follows:
As a result, employees are governed in their employment relationships by federal legislation if the enterprise or operation in which they are engaged is a federal work or undertaking as determined through the exercise of the POGG power or as enumerated in s. 91 of the Constitution Act, 1867, including matters excepted from provincial jurisdiction under s. 92(10). The employer may also fall under federal jurisdiction if it is found to be integral to a federal undertaking, though this requires, among other things, a high level of operational connection between the local and federal undertakings.
Where a federal undertaking carries on an operation unrelated to federal jurisdiction, that operation will be subject to provincial employment and labour law. In Canadian Pacific Railway Co. v Attorney-General of British Columbia, [1948] SCR 373, 1948 CanLII 18 (SCC), also known as the Empress Hotel case, the Supreme Court of Canada held that employees of the railway's hotel (as opposed to the employees working on the railway itself) were subject to provincial labour laws because the operation of the hotel was entirely divisible from the operation of the railway and as such was not an integral element of the operation of the railway. In other words, the hotel operation was not a federal work or undertaking, and the employees were governed by provincial law.
In general, employees of a federal work or undertaking, or of a work or undertaking that is integral to a federal undertaking, will fall under federal jurisdiction, and it is assumed in most instances that management of the undertaking in terms of employment and labour matters is essential and vital to the undertaking as a whole. Therefore, such employees will fall under federal employment law.
The following is a brief review of employees and industries in which employment matters fall under federal jurisdiction.
Each jurisdiction has full and exclusive competence to legislate with regard to its own employees. Therefore, employees of the federal government will fall under federal rather than provincial jurisdiction.
Employees of a federal Crown Corporation may or may not fall under federal jurisdiction. Such employees are governed by federal law only where the corporation is engaged in a federal work or undertaking. See the discussion of the Empress Hotel case above.
In Ontario Hydro v Ontario (Labour Relations Board), [1993] 3 SCR 327, 1993 CanLII 72 (SCC) the Supreme Court of Canada held that jurisdiction over employees working in Ontario Hydro's nuclear operations was federal rather than provincial. Following this decision, the Canada Labour Code was amended so as to authorize the federal government to make regulations that effectively made the terms of provincial legislation, instead of what was in the Canada Labour Code, apply to these employees. Federal regulations to do this were made and came into force on April 1, 1998. As of that date, Ontario Hydro nuclear operations employees became subject to Ontario's employment standards legislation and are covered (both with respect to the standards and enforcement) under the ESA 2000 just as employees in non-nuclear operations are - see federal regulation SOR/98-181. Note that the federal regulation applies to the Pickering and Darlington nuclear facilities owned and operated by Ontario Power Generation and to the Bruce nuclear facility operated by Bruce Power because the regulation defines a nuclear facility as one other than Ontario Hydro if, on the day on which the regulation came into force (April 1, 1998) or after, the facility was owned and operated by Ontario Hydro.
This federal regulation is supported by s. 94 of the ESA 2000, which makes it clear that the Ontario Labour Relations Board and other persons having power under the Act (such as employment standards officers and the Director of Employment Standards) have the authority to exercise the powers conferred under the federal regulation, i.e., to enforce the employment standards provisions that are incorporated by reference into the Canada Labour Code. See ESA Part XXI, s. 94 for a further discussion.
There is one exception to the application of the ESA 2000 to Ontario Power Generation's nuclear energy facilities. Under the ESA 2000, if an employment standards officer wishes to enter (without the consent of the occupier) a place that is used as a dwelling, they are required under ESA Part XXI, s. 91(3) to obtain a search warrant issued under ESA Part XXI, s. 92. However, if (in the unlikely event) the dwelling were a nuclear facility, the officer would be required to obtain the search warrant under s. 487 of the Criminal Code because s. 4 of the federal regulation SOR/98-181 specifically refers to the search warrant being obtained under that section of the Criminal Code. Please refer to the discussion of entry into dwellings in ESA Part XXI, s. 92.
Pursuant to the POGG power, the field of aeronautics was held to be within the federal jurisdiction by the Privy Council in the 1931 decision in The Attorney-General Canada v The Attorney-General of Ontario and others, [1931] UKPC 93 (22 October 1931), also known as the Aeronautics Reference. The Council stated that aerial navigation was of such importance as to affect the body politic of the dominion.
Accordingly, all airlines, air transport undertakings, airports and their employees fall under federal jurisdiction and may include:
However, the following employees may not be necessary, integral or vital to the functioning of an airport, and may not be under federal jurisdiction:
continuous and regularbasis);
Note that the fact that an airport is situated on land owned by the federal government is not determinative of jurisdiction. The Crown in right of Canada owns a variety of property including national ports, public harbours, roads, canals and airports. It is the nature of the undertaking rather than the ownership of the land that determines where jurisdiction will lie.
Communications includes radio and television broadcasting, cable television, telecommunications and internet service providers.
Radio and television broadcasting fall under federal jurisdiction pursuant to the POGG power in s. 91 of the Constitution Act, 1867. See the Privy Council's decision in The Attorney General of Quebec (Appeal No. 84 of 1931) v The Attorney General of Canada and others, (Canada) [1932] UKPC 7 (9 February 1932), also known as the Radio Reference.
The sale of antenna time and the production of commercials has been held to be program production
and not broadcasting and therefore employees engaged in the same fall under provincial jurisdiction rather than federal. See the Supreme Court of Canada's decision in Canada Labour Relations Board et al. v Paul L’Anglais Inc. et al, [1983] 1 SCR 147, 1983 CanLII 121 (SCC).
Cable television, telecommunications and other forms of electronic communications including internet service providers (ISPs) fall under federal jurisdiction through the combined effect of s. 91(29) and s. 92(10)(a) of the Constitution Act, 1867. Together, these provisions provide Parliament with exclusive jurisdiction over interprovincial communications works and undertakings (and transportation).
In Island Telecom Inc. et al., 2000 CIRB 59, the Canada Industrial Relations Board held that internet service providers (ISPs
) fall within exclusive federal jurisdiction, including employment matters, because they constitute a federal undertaking carrying on an activity that is within the exclusive jurisdiction of Parliament pursuant to s. 91(29) and s. 92(10)(a) of the Constitution Act, 1867. The basis for this decision was that ISPs provide customers with the ability to communicate across Canada and internationally, i.e., internet service providers provide access to local, inter-provincial and international telecommunications through the Internet.
In Northern Telecom v Communications Workersthe Supreme Court of Canada held that the installation of telephone switching and transmitting equipment was part of the establishment and maintenance of a communications network and employees engaged in such an undertaking were therefore under federal jurisdiction. However, where a company is merely installing telephone receivers, its employees are under provincial jurisdiction. See Communications Workers of Canada v CTG Telecommunications Systems, Inc. (Canadian Telecommunications Group), 1985 CanLII 890 (ON LRB).
Companies such as Bell Mobility Inc. which provide wireless telecommunications services would, as such, fall under federal jurisdiction. Until January 2009, a company called Bell Distribution Inc. (BDI
) owned and operated a number of retail stores selling Bell Mobility products. As a retail operation, the stores and employees fell under provincial jurisdiction in employment matters. However, on January 1, 2009, BDI was amalgamated into Bell Mobility Inc. and since that date the retail stores have been owned operated by Bell Mobility Inc. There are 114 such retail store locations in Ontario, which operate under one of three banners: Bell, Bell World and Virgin Mobile. Where such stores are no longer operating as separate and severable entities from Bell Mobility Inc., the employees in those retail stores would be subject to federal jurisdiction.
The employees of federally-chartered banks fall under federal jurisdiction as banking is a subject enumerated in s. 91 of the Constitution Act, 1867.
However, loan and trust companies, credit unions and insurance companies fall under provincial jurisdiction. This is the case even if they operate in more than one province, perform some banking functions,
or are federally-incorporated. See Canadian Pioneer Management Ltd. et al v Labour Relations Board of Saskatchewan et al, [1980] 1 SCR 433, 1979 CanLII 180 (SCC).
As noted earlier, as a general rule, the regulation of employment standards and labour relations falls within provincial jurisdiction pursuant to the province's constitutional authority over Property and Civil Rights in the Province, as per s. 92(13) of the Constitution Act, 1867. However, s. 91(24) of the Constitution Act, 1867 gives the federal government jurisdiction over Indians which has been held to encompass all Indigenous Peoples, including First Nations, Inuit and Métis Peoples.
Whether any particular workplace is governed by federal legislation is determined on a case-by-case basis after examining the nature, operations and habitual activities of the undertaking. Generally, however, an employer will not be found to be governed exclusively by federal employment standards legislation merely because the business is owned and operated by Indigenous persons, is located on a reserve or delivers its services in a culturally sensitive manner.
For example, in NIL/TU,O Child and Family Services Society v B.C. Government and Service Employees' Union, [2010] 2 SCR 696, 2010 SCC 45 (CanLII), the Supreme Court considered whether an Indigenous child welfare agency, set up pursuant to provincial child welfare legislation, was federally or provincially regulated with respect to their labour relations. A number of features of the child welfare agency suggested that it would be federally-regulated: it was set up collectively by seven First Nations; the child welfare services were provided primarily by First Nations employees to First Nations clients; the services were designed to protect, preserve and benefit the distinct cultural, physical and emotional needs of the children and families of the First Nations involved; it operated out of offices on a First Nations reserve; and federal funding was provided. The SCC found that the nature of the welfare agency’s operation was to provide child and family services, a matter that falls exclusively within provincial jurisdiction and therefore determined that the child welfare agency was provincially regulated.
There are some circumstances, however, where a workplace located on a reserve will be governed by employment standards legislation pursuant to the federal government's jurisdiction with respect to Indians, and Lands reserved for the Indians
as per s. 91(24) of the Constitution Act, 1867. For example, a band council and its employees who are involved in the administration of the reserve are generally subject to the Canada Labour Code, and not the ESA 2000, because their primary function is the provision of Indigenous governance.
However, this does not mean that any employment activity by a band council is necessarily a matter of exclusive federal jurisdiction. Where a federal undertaking carries on an operation unrelated to federal jurisdiction, that operation will be subject to provincial employment and labour law. The difficult question is whether a band council, when employing persons in the exercise of a particular activity, is carrying on a federal activity, operation or function such that the employment standards and labour relations pertaining to that activity must be federally regulated. This question has given rise to divergent cases depending on the particular band activity at issue.
It is recommended that guidance be sought in files involving Indigenous employers or employees.
The owner and employees on a ship engaged in interprovincial or international shipping will fall under federal jurisdiction.
If the owner of a ship falls under federal jurisdiction, but repairs are done to the ship by the employees of another employer while the ship is in drydock, the employees will generally fall under provincial jurisdiction if their employer would otherwise fall under provincial jurisdiction.
The owner of a ship whose ships operate totally within the province of Ontario (e.g., the Toronto Island and Manitoulin Island Ferries) and its employees will be governed by provincial legislation.
Federal jurisdiction over seacoast and inland fisheries
, as set out in s. 91(12) of the Constitution Act, 1867, has not been considered to include jurisdiction over the employment relations of any particular fishing business. The jurisdiction is limited to regulating fisheries in a general way: for example, setting limits on catches and establishing seasons. See United Fishermen and Allied Workers' Union et al v British Columbia Provincial Council, [1978] 2 SCR 97, 1977 CanLII 205 (SCC).
As a consequence, jurisdiction over employment relations in the fishing industry, including persons employed in fisheries and those working on commercial fishing boats on inland waters, lies with the province. See Great Lakes Fishermen and Allied Workers' Union v 538391 Ontario Limited (Peralta Foods), 1987 CanLII 3081 (ON LRB).
Feed mills, flour mills, seed cleaning mills and feed warehouses, wherever located in Ontario, fall under federal jurisdiction. These facilities are under federal jurisdiction as a result of the federal Parliament making a declaration under s. 92(10)(c) of the Constitution Act, 1867 that they are for the general advantage of Canada
in s. 55(1.1) of the Canada Grain Act, RSC 1985, c G-10 in s. 76 of the Canadian Wheat Board Act, RSC 1985, c C-24. Occasionally farms have non-commercial seed cleaning mills for their own use. In such cases, it is recommended that advice be sought.
The federal Parliament also made a declaration under s. 92(10)(c) of the Constitution Act, 1867 with respect to certain grain elevators in s. 55(1) of the Canada Grain Act, RSC 1985, c G-10. The elevators
covered by the declaration and that as a result fall under federal jurisdiction are:
In other words, pursuant to that declaration, most inland grain elevators east of Thunder Bay fall under provincial jurisdiction. However, it is possible that such an elevator will fall under federal jurisdiction if it is an integral element of a federal operation, e.g., has been purchased and is being operated by a federally regulated employer.
If there is a situation in which this provision potentially arises, it is recommended that advice be sought.
The trucking industry is not a subject specifically enumerated in s. 91 of the Constitution Act, 1867 as falling under federal jurisdiction, and accordingly, provincial employment legislation will generally apply.
Nonetheless, a portion of the industry does fall under federal jurisdiction as a result of ss. 91(29) and 92(10)(a) of the Constitution Act, 1867, which bring works or undertakings connecting a province with any other or extending beyond the limits of a province under federal jurisdiction.
The trucking industry provides services in the following ways:
The courts have held that where a common carrier's extraprovincial activity is continuous and regular
it will be considered to be a federal work or undertaking and fall under federal jurisdiction. In R v. Toronto Magistrates, Ex Parte Tank Truck Transport Ltd., 1960 CanLII 120 (ON SC), only six per cent of the firm's business consisted of extraprovincial haulings, yet the court found that the extraprovincial aspect of the business was continuous and regular
. The fact that the volume of intraprovincial work exceeded the extraprovincial aspect was not relevant.
In R v Cooksville Magistrate's Court, Ex parte Liquid Cargo Lines Ltd., 1964 CanLII 162 (ON SC), only 1.6 per cent of the company's business was extraprovincial, but the court held that:
Viewed from the point of view of the applicant company, it is clear that its customers are provided with extraprovincial service consistently and without interruption whenever they apply to the applicant for such service. The applicant stands ready at any time to engage in hauls outside the boundaries of the Province of Ontario at the instance of any of its customers.... Further, the evidence is clear that it has made such trips frequently....
Therefore, if the trucking firm is willing and able to engage in extraprovincial activity whenever requested, and if it does in fact so engage, the extraprovincial activity will be considered continuous and regular
and employment matters will be subject to federal jurisdiction.
Consequently, the Program takes the position that if a company operating as a common carrier holds an extraprovincial license it will fall under federal jurisdiction unless:
As a general rule, the delivery operation of a company whose principal operation is manufacturing, processing or selling will not fall under federal jurisdiction, even if the company makes extraprovincial deliveries. This is so even where the extraprovincial trips are regular and continuous. See Milk and Bread Drivers, Dairy Employees, Caterers and Allied Employees (International Brotherhood of Teamsters, Chauffeurs, Warehousemen and Helpers of America, Local Union No. 647) v Dominion Dairies Limited, 1978 CanLII 443 (ON LRB), Humpty Dumpty Foods Ltd. v U.I.T.B.C.A., Local 333 and United Steelworkers of America v Pepsi-Cola Canada Ltd., 1995 CanLII 9942 (ON LRB).
This is so because it is the principal operation of the undertaking that determines its essential character; if the pith and substance
is one of manufacturing, processing or selling of goods, and not transportation, then the undertaking does not fall under s. 92(10)(a) of the Constitution Act, 1867 and is not a federal undertaking.
Unless the nature of the principal operation puts the undertaking within some other head of federal jurisdiction, the entire undertaking, including the extraprovincial hauling is within provincial jurisdiction. See General Truck Drivers' Union, Local 879 v William R. Barnes Co. Ltd. and Re Mason Windows Ltd.
Generally, companies that supply only the drivers of vehicles to other companies will not fall under federal jurisdiction, even if the drivers are assigned to work for companies who transport goods across provincial or national borders on a common carrier basis. This is so because it is the normal or habitual activities of a business that define the nature of its operation. In this situation, if the nature of the operation is one akin to a staffing company or temporary employment agency for truck drivers and not transportation, then the undertaking would not fall under s. 92(10)(a) of the Constitution Act, 1867 and is not a federal undertaking. See Woodmac Services Ltd. v Macklam (July 19, 1979), ESC 644 (Saxe).
Likewise, a company that leases vehicles does not fall under federal jurisdiction as a federal undertaking, even if the vehicles are driven beyond the boundaries of the province in which the lease is effected. The lessor is not operating the vehicles and therefore the leasing company's operation is not considered to be one that connects provinces or extend beyond the limits of a province as per s. 92(10)(a) of the Constitution Act, 1867.
However, in some situations, a staffing company or a company that leases vehicles could fall under federal jurisdiction if it is found to be integral to a federal undertaking.
The test that must be applied to find a seemingly provincial undertaking to be integral to a federal undertaking (e.g., a carrier service that crosses provincial or national borders) is rigorous and requires an extensive analysis of the facts.
The Supreme Court of Canada has laid out four general inquiries to help with the analysis of whether a seemingly local undertaking is integral to a federal undertaking:
The above test (and most particularly the inquiry under four above) has a high threshold. As a result, it is rare that a company leasing drivers and/or vehicles to a common carrier that transports goods across provincial boundaries would be found to be integral to that federal undertaking and thereby fall under federal jurisdiction.
The same principles apply to bus lines as those set out under trucking. Although a bus line is engaged principally in transporting people as opposed to hauling goods, in pith and substance it may be an undertaking that connects the province with any other or extends beyond the limits of the province. In that event, it would fall under federal jurisdiction.
For example, in Ontario (Attorney General) v Winner (c.o.b. Mackenzie Coachlines), [1954] UKPC 8 (22 February 1954), the Privy Council held that a bus line operating from Boston through Maine and New Brunswick to Nova Scotia that also picked up and set down passengers at intermediate points was an undertaking connecting the province of New Brunswick with that of Nova Scotia, and was therefore within exclusive federal jurisdiction.
In some cases, a municipal bus line or a local school bus service is operated by and functionally integrated with a federally regulated interprovincial bus or transportation company. In particular, the bus service and the rest of the interprovincial transportation company may be subject to common management, control and direction. In such cases, it may be that the bus service which is operating wholly within the province is nonetheless considered to fall under federal jurisdiction.
The same principles apply to courier companies as those set out under Trucking and Bus Lines above.
A courier company may in pith and substance be an undertaking that connects the province with any other, or extends beyond the limits of the province. In that event, it would fall under federal jurisdiction.
In order for the courier company to fall under federal jurisdiction, the courier company has to transport the items across the border itself, rather than being a freight forwarder (i.e., a middleperson that picks up packages then hands them off to another company to transport over a border). In addition, the transport over a border has to be continuous and regular. For information on the meaning of continuous and regular, see the discussion about Common Carriers under Trucking above.
When a business has been sold, ESA Part IV, s. 9 normally applies to provide continuity of employment for any of the vendor's employees hired by the purchaser. Refer to ESA Part IV, s. 9 for further discussion.
Generally, it is Program policy that ESA Part IV, s. 9 does not apply in a cross-jurisdictional sale (i.e., where the sale, lease, transfer or other disposition transforms a federal undertaking into a provincial undertaking or vice-versa.) There cannot be deemed continuity of employment in such a transfer because the Employment Standards Act, 2000 applies only to those employers who are within the legislative jurisdiction of the province. See Western Stevedoring Co. v Pulp, Paper & Woodworkers of Canada and Brotherhood of Railway, Airline and Steamship Clerks, Freight Handlers, Express and Station Employees v Canadian Pacific Ltd. and Marathon Realty Co. Ltd. For the contrary view, see Canada (Attorney-General) v Standard Trust Co., 1994 CanLII 7516 (ON SC) and Arthur et al v A.A.S. Telecommunications Services Ltd. (February 17, 1998), 1262-97-ES (ON LRB).
Of course, a provincial business could be sold to a federal business and still remain under provincial jurisdiction if it was a discrete, severable part of the federal business and thereby retained its provincial character. In that case, ESA Part IV, s. 9 continuity would require the purchaser to give credit for service to those of its employees who had worked for the vendor.
In Canada (Attorney-General) v Standard Trust Co., a decision made under the former Employment Standards Act, the court held, contrary to Program policy, that the sale of business provisions do apply in a cross-jurisdictional sale. In that case, the assets of Standard Trust (which operated as a trust company and therefore was under provincial jurisdiction) were sold by the liquidator to Laurentian Bank (which was going to use the assets in a bank operation falling under federal jurisdiction). Most employees of Standard were hired by Laurentian, which voluntarily agreed to recognize the employees" length of employment with Standard. The Court held that as s. 13 of the former Employment Standards Act, now ESA Part IV, s. 9(1), provided for continuity of employment where a purchaser hired the employees of the seller and deemed the employment of those employees not to have been terminated, and as there was nothing in the legislation that said the purchaser must be within provincial jurisdiction, former employees of Standard were not entitled to termination and severance pay if they had been hired by Laurentian.
The reasoning in the Canada (Attorney-General) v Standard Trust Co. decision was followed by an adjudicator in the Arthur et al v A.A.S. Telecommunications Services Ltd. decision. There, Rogers Cantel Paging sold part of its business to A.A.S., which resulted in the transformation of a federal undertaking into a provincial undertaking. Shortly after the sale, A.A.S shut down. Adopting the court's reasoning in the Canada (Attorney-General) v Standard Trust Co. decision, the adjudicator rejected the argument that the word employer in s. 13(2) of the former Employment Standards Act, now ESA Part IV, s. 9(1), should be read as if it was modified by the words within the jurisdiction's competence
. The adjudicator ruled that s. 13 of the former Employment Standards Act applied to the sale and that there was continuity of employment. The adjudicator remarked that the argument for the application of s. 13 of the former Employment Standards Act to the sale in this case (federal to provincial) was far stronger than the one in Canada (Attorney-General) v Standard Trust Co. because there was no enforcement problem that flows from finding a formerly federally-regulated business subject to a provincial statutory provision.
Program policy is that neither Canada (Attorney-General) v Standard Trust Co. nor Arthur et al v A.A.S. Telecommunications Services Ltd. should be followed in applying ESA Part IV, ss. 9 and 10. In Rostrust Investments Inc./Investissements Rostrust Inc. v Doxtater, 2006 CanLII 41431 (ON LRB), the Ontario Labour Relations Board distinguished Standard Trust on the basis that the current act, unlike its predecessor, specifically provides that it does not apply to employers and employees if their employment relationship is within federal labour law jurisdiction.
At issue in Rostrust Investments Inc. v Doxtater was whether ESA Part IV, s. 10 applied where the former provider of building services fell under provincial jurisdiction and the new provider fell under federal jurisdiction; since the new provider and any employees it hired would be within federal jurisdiction, the Board held that ESA Part IV, s. 10 did not apply.
While Rostrust Investments Inc. v Doxtater was concerned with ESA Part IV, s. 10 and a change of jurisdiction from provincial to federal, its reasoning is equally applicable to ESA Part IV, s. 9 and to changes in jurisdiction from federal to provincial. Accordingly, regardless of whether one is dealing with a change in building services providers or a sale of a business, and regardless of whether the change in jurisdiction is from provincial to federal or federal to provincial, the continuity of employment provisions do not apply.
The sale of a provincial business (i.e., engaged in a provincial undertaking and under provincial jurisdiction) to a federal business may result in a transformation of the provincial undertaking to a federal undertaking (i.e., under federal jurisdiction).
For example: The sale of a boat that has been operated as a floating restaurant to a company that uses the boat to regularly ferry passengers to the United States.
In this case, ESA Part IV, s. 9 has no application to the employment relationship once the employer (and consequently the employment relationship) are no longer under provincial jurisdiction. In other words, the federal purchaser in the above example would not be subject to the provisions of the Employment Standards Act, 2000 and consequently there would be no s. 9(1) liability imposed on the purchaser.
The sale of a federal business (i.e., engaged in a federal undertaking and under federal jurisdiction) to a provincial business may result in a transformation of the business from a federal undertaking to a provincial undertaking (i.e., it is now engaged in a provincial undertaking and under provincial jurisdiction).
For example: A business operating a Great Lakes ferry that transports passengers to the United States is purchased by a company that uses the boat only as a floating restaurant. Several of the employees who had previously worked on the ferry are hired by the purchaser to work in the restaurant.
In this case, ESA Part IV, s. 9(1) could not be applied so as to recognize as continuous service any period of employment with a business that was, prior to its sale, a federal business. In other words, the employees hired by a purchaser who falls under provincial jurisdiction would not be given any credit for service with their previous federal employer.
Section 3(3) provides that an employee of an embassy or consulate of a foreign nation and their employer are not subject to theESA 2000. The nationality of the employee is irrelevant to the application of this exemption. Employees of an embassy or consulate who also work in locations other than an embassy or consulate of a foreign nation are covered by the Act for the work done at any other location.
Employees of foreign trade offices or foreign government tourist offices are subject to the Employment Standards Act, 2000, unless the office is an integral part of the embassy or consulate of the state in question. For a discussion of the distinction between trade offices and consular offices, see Gilligan v Swedish Trade Council and Swedish Trade Office (Canada) Inc. (February 2, 1998), ESC 97-91 (Randall).
Employees of a foreign embassy or consulate who have labour or employment complaints should contact the equivalent of the Ontario Ministry of Labour in the country of the embassy or consulate concerned.
Effective January 1, 2018, the partial exception for the Crown, a Crown agency or an authority, board, commission or corporation all of whose members are appointed by the Crown (collectively, “the Crown”), and its employees, that was previously found in subsection 3(4) was repealed by the Fair Workplaces Better Jobs Act, 2017 (FWBJA). As a result, as of January 1, 2018 Crown employees were no longer covered only by the Parts that were specified in s. 3(4); they were generally covered by all of the ESA. (Note that pursuant to s. 4(4.1), a provision introduced by the FWBJA, the Crown was exempted from the section 4 “related employer” provision effective January 1, 2018.)
Effective March 9, 2018, O. Reg. 285/01 (When Work Deemed to be Performed, Exemptions and Special Rules) was amended to exempt specified election officials employees from sections 17, 18 and 19 of the ESA.
On October 24, 2018, O. Reg. 285/01 (When Work Deemed to be Performed, Exemptions and Special Rules) was further amended to exempt the Crown and its employees from Part VII (Hours of Work and Eating Periods) and from Part VIII (Overtime Pay).
Effective January 1, 2019 , O. Reg. 285/01 was again amended and provides that the Crown and its employees are exempt from every provision of the Act except those listed in the relevant section. See O. Reg. 285/01 Section 2.1 for more information.
Often, as part of the education of its students, a school board will establish a program in which the secondary school students will gain practical work experience. Such programs may be called, for example, practicums or co-ops. When a student performs work in such a program, the student and his or her employer are exempt from the ESA 2000 pursuant to s. 3(5) paragraph 1.
For this exemption to apply, the following criteria must be met:
If the person is not a student at the school but is still in the program, or is in a program authorized by another school board, the exemption in s. 3(5)(1) will not apply.
Note that for the purposes of the exemption in s. 3(5), the term student
is not limited to a person less than 18 years of age. This is in contrast to the use of the word student for the purposes of the student minimum wage provisions; the student minimum wage applies to a student not otherwise exempted from the ESA 2000 pursuant to s. 3(5) who is under the age of 18 years and:
For more information on the student minimum wage, see ESA Part IX, s. 23.1.
Only the work in the program is exempt. If the student performs full or part-time work outside of the program (even if it is in the same workplace and for the same employer) the exemption will not apply to that work. For example, if the student performs work at a workplace under a co-op program on certain days of the week, but also performs work at the same workplace on other days, those other days' work would be covered by the ESA 2000 – see s. 3(6) “Dual Roles”.
The exemption will not apply just because an employee obtained their job through an employment or career counselling centre at a school, college or university.
In order for the exemption to apply, the secondary school in which the student is enrolled must be operated by a school board. The Program's position is that this refers to a school board within the meaning of the Education Act,RSO 1990, c E.82. Under s. 1 of the Education Act school board
means a district school board or a school authority. The Education Act contains the following definitions:
As a result, the exemption does not apply with respect to students in private, independent schools as they are not operated by a school board.
Colleges of applied arts and technology and universities often establish programs that permit students, and others, to gain practical work experience. When an individual performs work in such a program, that individual and their employer are exempt from the ESA 2000 in its entirety, with respect to that work, pursuant to s. 3(5) paragraph 2.
For the exemption to apply, the individual must perform work under a work experience program approved by a college or university. Unlike the secondary school student exemption in paragraph 1, it is irrelevant whether the individuals performing work in the work experience program are students at the college or university, that has approved the program, or at any college or university.
The exemption applies only to work performed under programs of Ontario colleges of applied arts and technology and Ontario universities. It does not apply to work performed under programs of institutions outside of Ontario.
In determining whether a particular college of applied arts and technology is an Ontario institution, reference can be made to section 2 of O. Reg. 34/03 under the Ontario Colleges of Applied Arts and Technology Act, 2002. That provision provides a list of institutions designated as colleges in Ontario.
The exemption applies only to work that is performed under the program; see “Dual Roles” at s. 3(6) for details.
Work performed under an apprenticeship program may be covered by this exemption, since such programs can include classroom training and, as such, form part of a program approved by a college or university.
For a more detailed discussion of the application of the ESA 2000 to apprentices please see the definition of employee in ESA Part I, s. 1.
The Fair Workplaces, Better Jobs Act, 2017 added this new provision to the ESA 2000.
Effective January 1, 2018, individuals who perform work under a program that is approved by a private career college registered under the Private Career Colleges Act, 2005, SO 2005, c 28, Sched L and their employers are exempt from the ESA 2000 in its entirety, with respect to that work, pursuant to s. 3(5) paragraph 2.1. It is only work that is performed under programs of Ontario private career colleges that can fall under this exception. It does not apply to work performed under programs of private career colleges outside of Ontario.
The exemption applies only to work that is performed under the program; see “Dual Roles” at s. 3(6) for details.
The new exclusion for private career colleges is subject to criteria as may be prescribed by regulation. As of the date of writing, there are no prescribed criteria.
Similar to the exemption in paragraph 2, it is irrelevant whether the individuals performing work in the program are students at the private career college.
Work performed under an apprenticeship program may be covered by this exemption, since such programs can include classroom training and, as such, form part of a program approved by a private career college.
For a more detailed discussion of the application of the ESA 2000 to apprentices please see the definition of employee in ESA Part I, s. 1.
Social assistance recipients involved in Ontario Works community participation activities, sometimes referred to as Welfare-to-Work programs, are exempt from theESA 2000 pursuant to s. 3(5) paragraph 3.
The criteria that must be met for this exemption to apply are as follows:
Persons who are merely referred by Ontario Works to a job placement agency or into training, or who are merely placed with an employer, do not fall into the exemption.
Although social assistance recipients are exempt from the ESA 2000 as a whole if they are engaging in the community participation activities, guidelines for participants’ working conditions have been set by Ontario Works. It is the responsibility of the Ministry of Community and Social Services, not the Ministry of Labour, to ensure that the guidelines are adhered to.
Note that on a date to be named by proclamation of the Lieutenant Governor, this paragraph will be repealed and substituted with modified wording. These modifications are due to changes to other legislation referenced in this paragraph. For more information, see the legislative section above.
Inmates of correctional institutions and penitentiaries operated by or under the province of Ontario or the federal government and individuals being held in a detention facility under the Police Services Act,RSO 1990, c P.15 or youth custody facility under the federal Youth Criminal Justice Act,SC 2002, c 1, who participate in work projects or rehabilitation programs, are exempt from the ESA 2000, pursuant to s. 3(5) paragraph 4.
Under s. 25 of the Ministry of Correctional Services Act, RSO 1990, c M.22 (MCSA
), the Minister of Community Safety and Correctional Services who had the powers and duties of the Minister of Correctional Services Act transferred to them by Order in council approved November 24, 2003 may authorize a rehabilitation program under which an inmate may continue to work at their regular employment or obtain new employment. Under s. 26 of the MCSA, the Minister may authorize an inmate to participate in a work project or a rehabilitation program outside the correctional institution. Finally, under s. 18(1) of RRO 1990, Reg 778, a regulation under the MCSA, an inmate may be required to perform work within an institution.
The requirements that must be met for the exemption in s. 3(5) para. 4 to apply are as follows:
When a person is convicted of an offence, instead of (or as well as) being confined to a detention facility or a place of custody or ordered to pay a fine, the offender (including a young offender) may be ordered to perform a certain amount of work or services, commonly known as community service. When performing this work, the offender is exempt from the subject to the court order is exempt from the ESA 2000 pursuant to s. 3(5) paragraph 5.
Any other employment undertaken by the offender is not exempted by this provision. For example, a person may be working full time as a secretary at a factory but has been ordered by a court to work 10 hours per week at a community centre. The work at the community centre would be exempt from the ESA 2000, but the ESA 2000 would apply to the employment at the factory, subject to other provisions, exemptions and special rules under the ESA 2000.
Note: This exclusion was originally scheduled to be repealed on January 1, 2019, pursuant to the Fair Workplaces Better Jobs Act, 2017. However, under the Making Ontario Open for Business Act, 2018 amendments, the repeal was delayed. The provision will now be repealed on a day to be named by proclamation of the Lieutenant Governor.
Under this provision, participants in simulated working environments (for example, a sheltered workshop program) are not covered by the ESA 2000 pursuant to s. 3(5) paragraph 6 if the primary purpose of the workshop is to rehabilitate the participants.
This exemption codifies Program policy and a decision under the former Employment Standards Act, Re Kaszuba and Salvation Army Sheltered Workshop et al., 1983 CanLII 1795 (ON SC). In that case, the Ontario Divisional Court, on judicial review, endorsed in slightly amended form the referee's conclusion that:
It is Program policy that in order for the exclusion under s. 3(5) to apply, economic productivity must be a minor and merely incidental aspect of an individual's participation in the work or services performed at a sheltered workshop. Consequently, not all organizations calling themselves sheltered workshops can consider themselves automatically falling within the exclusion in s. 3(5).
In order to determine whether s. 3(5) applies in a particular instance, consideration might be given to the list of factors set out in Linden J.'s concurring opinion in Re Kaszuba and Salvation Army:
The above factors may be helpful in determining whether, in the words of s. 3(5), paragraph 6, the primary purpose in placing an individual in a simulated job environment is his or her rehabilitation.
There is also a type of relationship where a charitable agency places a worker with a “host” business to reintegrate him or her into the workforce. The relationship typically lasts for a short period, such as eight weeks, and the worker receives payment from the host business. There is no control or training of the worker by the agency, and therefore the agency is not the employer of the worker. Usually, the agency pays the host business, which pays the worker. The agency is in turn reimbursed by a governmental agency such as the Workplace Safety and Insurance Board. Since this is not an arrangement where an individual is placed in a simulated job environment with a view to their rehabilitation, the exclusion in ESA Part III, s. 3(5) would not apply. The issue of whether or not there is an employer-employee relationship between the host business and the worker must be determined based on the relevant common law tests.
Such an arrangement was considered in 379169 Ontario Limited c.o.b.a. Bell Air Conditioning v Prevost (May 15, 1987), ESC 2242 (Fraser) in which the referee held that the applicant host company was an employer under the former Employment Standards Act and that the monies received by the employee pursuant to the former Workers' Compensation Board Vocational Training Program were wages under that Act.
This exemption is also referenced in the definition of employee in ESA Part I, s. 1 see Sheltered Workshop.
Holders of political, religious or judicial office are exempt from the ESA 2000 pursuant to s. 3(5) paragraph 7. This provision reflects the common law position that holders of political, religious or judicial office are not employees.
While it is often obvious whether an individual occupies a religious office, it is not always the case. In Kashruth Council of Canada v Rand, 2011 CanLII 71786 (ON LRB), the OLRB ruled on the question of whether this exemption applied to two Mashgiachim (kosher food inspectors). The OLRB held that while the position of a Mashgiach is a religious one, that does not in itself enough mean that a Mashgiach holds a religious office. The OLRB observed that an essential characteristic of office-holder status is independence. While not ruling out the possibility that there may be situations where a particular Mashgiach is subject to this exemption, it found that the individuals in this case did not have any greater independence than non-religious food inspectors and that the exemption therefore did not apply.
Members of quasi-judicial tribunals are exempt from the ESA pursuant to s. 3(5) paragraph 8. This provision reflects the common law position that members of quasi-judicial tribunals are not employees.
Holders of elected offices in organizations, including trade unions, are exempt from the ESA pursuant to s. 3(5) paragraph 9. This provision reflects the common law position that elected officers in an organization, such as school board trustees, are not employees.
This paragraph was amended by the Employment Standards Amendment Act (Infectious Disease Emergencies), 2020 effective March 19, 2020 to include reference to a regulation made under clause 141(2.1)(c).
Pursuant to s. 3(5) paragraph 10, police officers are exempt from the ESA 2000 except for the lie detector provisions contained in Part XVI.
If a regulation was to be made with respect to infectious disease emergencies under s. 141(2.1)(c), police officers would also be subject to the provisions of the ESA as provided for in that regulation. At the time of writing, no such regulation was made.
Clause 141(2.1)(c) provides that the Lieutenant Governor in Council may make regulations:
“providing that section 50.1 or any provision of it applies to police officers and prescribing one or more terms or conditions of employment or one or more requirements or prohibitions respecting emergency leave for infectious disease emergencies that shall apply to police officers and their employers”
Under s. 3(5) paragraph 11, directors are exempt from the ESA 2000 except for those Parts concerning the liability of directors and the administration and enforcement of the ESA 2000:
For a more detailed discussion, see the employee definition in ESA Part I, s. 1.
This paragraph was added to ss. 3(5) by the Working for Workers Act, 2022, effective January 1, 2023.
Employees who are business consultants or information technology consultants as defined in s. 1 of the ESA are excluded from the ESA if the requirements of ss. 3(7) are met. See the discussion under ss. 3(7) for details.
The exclusion applies to all employers and employees covered by the ESA, including the Crown, a Crown agency or an authority, board, commission or corporation all of whose members are appointed by the Crown and any employees of such an employer.
At the time of writing, the only prescribed individuals are those described in O Reg 477/18 – Non-Application of Act, which reads:
This regulation came into effect on November 15, 2018.
Pursuant to this regulation, the ESA 2000 does not apply to a “player on a major junior ice hockey team”, if the conditions set out in subsection (2) are met.
The regulation applies only to the major junior ice hockey team’s hockey players. It does not apply to any other individual on a major junior ice hockey team (e.g. equipment managers, trainers, coaches).
The Program is aware of major junior ice hockey teams in the Ontario Hockey League, although there may be others. However, in order for the ESA 2000 to not apply pursuant to this regulation, the condition in subsection (2) must be met.
The ESA will not apply only if the player on a major junior ice hockey team and the team – or the league in which the team is a member – have entered into an agreement (which pursuant to s. 1(3) of the ESA 2000 must be in writing) that provides that the player is entitled to receive a scholarship for a post-secondary educational program.
The agreement must provide a scholarship for each season the player plays on the team for the condition to be met.
The condition can be met even if the agreement contains eligibility criteria that the player must meet in order to qualify for the scholarship. The regulation does not establish any restrictions on the eligibility criteria that can be included in the agreement and does not establish any minimum amount of money that must be paid in order to qualify as a scholarship.
The condition will be met so long as there is a written agreement in place that contains provisions that provide for the scholarship; it does not matter whether the player ultimately meets the criteria and receives a scholarship.
There may be a period of time where an individual is a player on a major junior ice hockey team but has not entered into a written agreement that meets the condition set out in subsection (2). If there is an employment relationship during that period of time, the ESA 2000 will apply during that period.
Section 3(6) clarifies that employees who perform both exempt and non-exempt work for a single employer are entitled to the protections of the ESA 2000 in respect of the work that is not exempted from the application of the ESA 2000. See Arctic Pole Business Development Limited, CanLII 5939 (ON LRB) (Jan. 24, 2019) for a decision in the context of a co-op student at a college of applied arts and technology who also performed work that fell outside of the co-op arrangement. For a decision under the former Employment Standards Act, see Brown and Brown v 985156 Ontario Limited o/a 19 Queenston St. (February 4, 1994), ESC 94-25 (Alter).
A question may arise concerning the application of s. 3(6) dual roles versus the majority rule that has been adopted by the Program with respect to the application of certain entitlements or special rules. For example, when an employee performs work that is exempt from the overtime provisions in the ESA 2000 as well as work that is not exempt, the employee's entitlement to overtime will be based on all of the hours worked in a particular work week, so long as the non-exempt hours of work constitute 50% or more of the time the employee spent working. See ESA Part VIII, s. 22(9).
This majority rule has no application with respect to any work done by an individual if that work is exempt from the application of the ESA in its entirety. In other words, when an individual performs dual roles that is, they fall under s. 3(5) with respect to certain work, but is an employee to whom the ESA 2000 applies with respect to other work performed, only the work performed in the latter capacity is considered in determining their entitlements under the ESA.
For example, a student is performing work under a program approved by a college of applied arts. As such, they excluded from the application of the ESA 2000 under s. 3(5). They spend five hours a day, five days a week performing these duties. They also perform clerical duties for this same company that are outside the scope of the program for an additional six hours a day, five days a week. They are covered under the ESA 2000 in this latter capacity by virtue of s. 3(6) and so the ESA 2000 rules regarding hours of work and overtime apply only in respect of the 30 hours per week spent performing clerical duties. The majority rule has no application in this case - for the purposes of the ESA 2000 they are working only six hours a day and 30 hours each week and so there are no issues with respect to either excess hours or overtime pay.
This subsection sets out requirements for the purposes of paragraph 11.1 of ss. 3(5) of the Act, which provides that employees who are business consultants or information technology consultants as defined in s. 1 of the ESA are excluded from the ESA if the requirements of ss. 3(7) are met.
The exclusion established by paragraph 11.1 of ss. 3(5) – and the criteria set out in ss. 3(7) – were brought into the Act by the Working for Workers Act, 2022 (WFWA 2022), effective January 1, 2023. Although the provisions that make up the exclusion (the definitions of business consultant and information technology consultant in s. 1, paragraph 11.1 of ss. 3(5), and ss. 3(7)) use the word “consultant” rather than “employee”, the effect of the WFWA 2022 amendment is to exclude certain “employees” from the application of the Act. The amendment did not make any changes with respect to independent contractors, they are not employees and not covered by the ESA. The amendment also did not affect whether someone is or is not an employee under the Act or the test for determining whether someone is or is not an employee under the Act.
An employee who fits within the definition of “business consultant” or “information technology consultant” as set out in s. 1 of the ESA will be exempt from the ESA if all three of the requirements set out in paragraphs 1-3 are met (Note: at the time of writing, no additional requirements were prescribed pursuant to paragraph 4.):
Each requirement is discussed separately below.
If all three requirements are met, the exclusion will apply. This is the case whether the business or organization the employee provides the advice or services to is the employee’s employer, or a client of the employee’s employer.
The exclusion only applies when all three requirements are met. If any of the criteria stop being met, the exclusion ceases to apply. This issue is discussed below, following the discussion of each of the requirements.
The requirement in paragraph 1 will be met if the consultant provides their business or IT consultant services through either:
The arrangements described in paragraph 1 are often used by independent contractors. Where the individual is an independent contractor, the ESA does not apply and the exclusion from coverage under the Act would not be relevant.
Employees sometimes set themselves up as a corporation and/or register under the Business Names Act (BNA) as a sole proprietorship even though they are employees under the ESA per the relevant common law tests. The requirement in paragraph 1 captures those employees. For the purposes of this requirement, it does not matter whether the employee was being “misclassified” and treated as if the employee was not an employee under the Act – the only relevant question for the purposes of this requirement is whether the employee provided services through one of the business vehicles described in paragraph 1.
Employees who fit the s. 1 definition of business consultant or IT consultant but who do not set themselves up as a corporation or register as a sole proprietorship under the BNA as described in paragraph 1 will not be excluded from the ESA.
The requirement in paragraph 2 will be met if there is an agreement (which pursuant to ss. 1(3) must be in writing) for the consultant’s services that sets out:
In addition:
Although many of the types of payments mentioned in paragraph 2 also appear in the definition of “wages” in s. 1 of the ESA, the monetary threshold set out in paragraph 2 is a different concept. While s. 1 of the ESA makes a distinction between bonuses that are dependent on the discretion of the employer and whether the bonuses are related to hours, production or efficiency, there is no such distinction in paragraph 2. In other words, bonuses are to be excluded from the determination of whether the $60 threshold is met regardless of whether they are dependent on the discretion of the employer and whether they relate to hours, production or efficiency.
Although s. 11 of the ESA requires employers to establish a recurring pay period and a recurring pay day, there are no such requirements in the context of the requirements for the exclusion to apply. As such, the agreement required by paragraph 2 could, for example, provide for irregular payments. The agreement could also set out a payment schedule without specifying the payment date or dates. For example, where payment is due to the consultant within a certain number of days of the completion of the project, although the payment date is not specified, the requirement to set out when the employee will be paid may be satisfied. However, it is Program policy that the timing of payment must be objectively ascertainable in order for the agreement to meet the requirement of setting out “when” the consultant will be paid.
Paragraph 3 provides that the consultant must be “paid the amount set out in the agreement as required by paragraph 2”. The requirement in paragraph 3 will be met only if the consultant is paid the amount set out in the agreement required by paragraph 2, and no later than the date or dates set out in the agreement required by paragraph 2.
It is Program policy that the consultant must be paid at least the amount set out in the agreement; if the hourly rate actually paid is greater than the hourly rate set out in the agreement, this criterion is met. However, the requirement to pay at least the amount set out in the agreement means that where the consultant is paid less than the hourly rate stated in the agreement, the requirement in paragraph 3 is not met and the exclusion does not apply. This is true even if the rate paid is in excess of $60 per hour: for example, where the agreement states that the consultant is entitled to $80 per hour, but the consultant is paid $70 per hour, the requirement in paragraph 3 is not satisfied.
Employees are excluded from the ESA pursuant to ss. 3(5) only if they meet the definition of “business consultants” or “information technology consultants” set out in s. 1 of the ESA and if all three requirements set out in paragraphs 1-3 of ss. 3(7) are met. If the exclusion apply for a time, but then any of the requirements for the exclusion to apply stop being met, the exclusion ceases to apply.
For example, this could happen if an employee’s job duties change and they no longer meet the definition of business consultant or IT consultant. It could also happen where the employee stops providing services through a corporation or registered sole proprietorship as described in paragraph 1. It may also happen if a new agreement required by paragraph 2 is entered into that no longer meets the $60 per hour threshold, or, if the employer does not pay the amount set out in the agreement as required, or on the date or dates set out in the agreement.
Paragraph 2 of ss. 3(7) establishes one of the requirements that must be met in order for the exclusion to apply. In general, it provides that there must be a written agreement for the employee’s services that sets out when the employee will be paid and the amount the employee will be paid, which must be at least $60 per hour, excluding certain specified payments.
Subsection 3(8) provides that for the purposes of that requirement, rules may be prescribed with respect to the calculation of an employee’s hourly rate or other compensation. At the time of writing, no other rules had been prescribed.
This provision was introduced into the ESA 2000 by the Fair Workplaces, Better Jobs Act, 2017, SO 2017, c 22 effective January 1, 2018, at the same time that the former s. 3(4) – which provided that only certain provisions of the ESA 2000 applied to the Crown, Crown agencies or an authority, board, commission or corporation, all of whose members were Crown appointees – was repealed.
This section provides that the ESA 2000 binds the Crown. However, it must be read in conjunction with:
In law, a person includes a corporation. Further, for purposes of the ESA 2000, person is defined in ESA Part I, s. 1(1) to include a trade union. As a result, corporations, individuals (sole proprietors), partnerships (whether of individuals or corporations), unions and other associations (whether of individuals or corporations) are all potentially within the scope of s. 4.
The definition of employer in ESA Part I, s. 1(1) states:
In order for separate persons to be treated as one employer, the following requirements must be met:
A detailed discussion of these requirements is below.
Note: On January 1, 2018, the Fair Workplaces, Better Jobs Act, 2017 SO 2017, c 22 amended s. 4 to remove the requirement that the intent or effect of the arrangement as described in s. 4(1) must be to defeat, either directly or indirectly, the purpose of the ESA 2000 in order for the employer and other persons to be treated as one employer. If the business relationship existed before January 1, 2018, and the contravention occurred before January 1, 2018, the intent or effect test should be applied.
Note also that while at one time under the former Employment Standards Act, two or more entities could not be treated as related employers unless the employee whose rights were in question was an employee of each of the entities concerned, that requirement was eliminated by amendments made to the former Employment Standards Act in 1987. There is nothing in the language of s. 4 to suggest that an employee must be an employee of each of the entities concerned in order for s. 4 to apply.
In determining whether the associated or related test is met, the employment standards officer should consider the following significant criteria. They are listed in descending order of significance with the most important factor listed first:
This list is not exhaustive; there may be other relevant factors in the context of a particular case. It should also be noted that it is not necessary for all of the factors to be present in order for a finding of relatedness or association to be made under s. 4(2). See Verdun v PlateSpin Canada Inc., 2005 CanLII 1637 (ON LRB) for a good discussion of these criteria.
The following is a discussion of each of the criteria.
The requirement that two entities be under common control or direction appeared in the pre-June 15, 1987 Employment Standards Act. That phrase, however, did not appear in provisions in the former Employment Standards Act that came into force on June 15, 1987, and it does not appear in s. 4(1) of the ESA 2000. As a result, it is not always necessary to show common control or direction or common management to make a finding of relatedness. However, it is the policy of the Program that common management will be a highly significant (although not always a necessary) factor in determining relatedness. For example, if Corporation A exercises control on a regular basis over the internal management of its subsidiary, Corporation B, then the common management test will be satisfied. This form of control may be evident in a number of forms, such as:
The concept of a directing mind
or controlling mind
is often helpful in determining whether there is common management. For example, if several corporations constitute a comprehensive and integrated business and are under the control of an individual who is the directing mind of the business, the common management test will be satisfied. See 550551 Ontario Ltd. v Framingham (Div. Ct.), 1991 CanLII 7388 (ON SC), a decision under the former Employment Standards Act.
If there is a common directing or controlling mind, the common management test may be met even though the corporations involved do not have common directors. See 782368 Ontario Inc. o/a Consolidated Security Services v Powers (December 23, 1990), ESC 2793 (Barnett), another decision under the former Employment Standards Act.
Note, however, that an individual who is the controlling or directing mind of a business would not be made personally liable under s. 4(2) unless the individual is operating as a sole proprietor. See 550551 Ontario Ltd. v Framingham (Div. Ct.) and also Canada Machinery Corporation v Employees (September 18, 1991), ESC 2931 (Mitchnik). A sole proprietorship exists where an individual carries on business themselves, as opposed to where a corporation or partnership carries on the business. A sole proprietor might carry on the business under their own name or they may do so under another name. If the sole proprietor carries on business other than under their own name, the sole proprietor is required to file a declaration under the Business Names Act, RSO 1990, c B.17. This declaration is required to be filed at the Ministry of Government and Consumer.
The mere fact that entity A owns a majority interest in entity B may not be sufficient in itself to satisfy the common management test. If the ownership is in the nature of an investment only, and A does not manage or actually control the affairs of B, the common management test may not be met. In this regard see Modern Mold Ltd. v Finnerty (December 18, 1990), ESC 2802 (Brown), a decision under the former Employment Standards Act. However, if A does manage the affairs of B, the common management test will be satisfied and there will be a strong indication that the two entities are related.
The common law cases in the area of wrongful dismissal are also helpful. At common law, a plaintiff in a wrongful dismissal action against his employer may wish to join the employer's parent corporation as a party to the action, because it has a better ability to pay a judgment or is in a jurisdiction in which it is procedurally more advantageous to sue. In such cases, the common management test is often a key one. See, for example, Manley Inc. v. Fallis and Sinclair v Dover Engineering Services Ltd., 1987 CanLII 2692 (BC SC).
The common management test may also be satisfied even though Corporation B does not commence operations until after Corporation A ceases to do so. For example, if the sole shareholder and manager of Corporation A discontinues the business and sets up Corporation B, in which she or he is also the sole shareholder and manager, the common management test would be met and a finding of relatedness may be made. See Refac Industrial Contractors Inc. v Haygood et al (May 30, 1990) ESC 2703 (Brown), a decision under the former Employment Standards Act. Note this example is not intended to imply that the owner of A must be the owner of B in order for the common management test to be met. If A and B had a common controlling mind, this test will be met.
Examples of common financial control would be a centralized payroll, centralized accounting functions and procedures, and consolidated financial statements. For example, if Corporation A performs the payroll functions for both Corporation A and B, the common financial control test will be met, and there is an indication that the corporations may be related. See for example Laverty Richards Guerrieri Investments Inc. o/a Madame's Mansion Restaurant v McHugh (June 13, 1988), ESC 2347 (Baum), a decision under the former Employment Standards Act.
The common ownership test would be met where, for example, Corporation A owned more than 50 per cent of the shares of each of Corporations Band C. In such a case, Band C would be under common ownership. The common ownership test by itself will likely not support a finding of relatedness - see Modern Mold Ltd. v Finnerty, discussed previously. However, if, in addition to common ownership, one or more of the other factors is present, such as common management, market or customers, then a finding of relatedness may be made.
The existence of a common trade name or logo may be supportive of a finding of relatedness or associatedness. For example, if one company is X Ltd. and the other is Y Ltd. carrying on business as X, the common trade name or logo criterion will be satisfied. For an example of a decision under the former Employment Standards Act, see Million Dollar Saloon Inc. v MacDougall (October 13, 1989), ESC 2576 (Rose). However, franchisees using the same trade name under license from the franchisor will generally not be related to each other or to the franchisor. There may be some cases, though, where they are related, especially where the relationship between the parties goes beyond a pure franchise arrangement. For example, see Texas Longhorn Café Inc. v Snider et al (September 1, 1992), ES 142/92 (Wacyk), a decision under the former Employment Standards Act, where the arrangement included movement of staff and supplies between two entities as well as overlaps in ownership.
The requirement for the employee to have been employed by all of the entities considered related appeared in the pre-June 15, 1987 Employment Standards Act. However, neither s. 4(1) nor the corresponding provisions under the former Employment Standards Act that came into force on June 15, 1987 contained such a requirement. Nonetheless, the fact that the employee-claimant or other employees have worked for both entities A and B is significant (although no longer necessary) in determining whether the entities are related or associated under s. 4(1).
The transfer of employees may indicate a functional integration between the two entities suggesting that they are related, especially if there is common management or common financial control. For example, see Million Dollar Saloon Inc. v MacDougall, a case under the former Employment Standards Act. If the entities are covered by the same collective agreement, and there is movement of unionized employees from one entity to the other, it may indicate a possibility that the entities are related. But note that some collective agreements are of a type that is meant to cover several employers who have no connection with each other apart from the fact that they are all in the same industry, e.g., provincial agreements in the industrial, commercial and institutional sector of the construction industry.
The use of the same assets by two or more entities or the transfer of assets between them may be an indication that the two entities are associated or related under s. 4(1). For example, if the two entities operate out of the same premises or share the same machinery and equipment, this may be an indication that the entities are related or associated, especially if one of the other more significant factors such as common management or common financial control is present. For example, see Synform Design Group Inc. v Onorato (December 25, 1990), ESC 2805 (Baum), a decision under the former Employment Standards Act.
If there is a transfer of assets or a transaction between two entities, and the transfer or transaction is not at fair market value, then there is an indication that the entities are not dealing at arm's length, which suggests that the entities are associated or related. For example, where Corporation A, which owns real estate and leases that property at below market rent to Corporation B, the two corporations may be related. See 550551 Ontario Ltd. v Framingham (Div Ct), decided under the former Employment Standards Act.
The common market/customer test was adopted in Refac Industrial Contractors Inc. v Haygood et al, a decision under the former Employment Standards Act. The common market/customers test would be met if, for example, Corporation A sold equipment to its customers and Corporation B serviced that equipment. This test should be used in conjunction with the more significant of the tests.
Another test adopted by the referee in Refac Industrial Contractors Inc. v Haygood et al was the mode and means of production
test. It involves consideration of whether the companies are manufacturing the same type of product in the same manner. The mode and means test is considered by the Program to be overly narrow and not to be determinative in any respect.
This requirement is quite straightforward. There must be more than one entity carrying on the associated or related activities, businesses, etc. It is important to note that the activities need not be carried on at the same time, see s. 4(3). Corporation A and B may be a single employer even if B did not start carrying on business until such time as A ceased to do so. Decisions under the former Employment Standards Act, before there was explicit statutory wording to the effect of s. 4(3), include Refac Industrial Contractors Inc. v Haygood et al, 782368 Ontario Inc. o/a Consolidated Security Services v Powers (December 23, 1990), ESC 2793 (Barnett), and Chatters Restaurant and Tavern Inc. and 791818 Ontario Ltd. o/a T.C. Mellons v Morrissey and Yarmoloy (July 28, 1992), ES 121/92 (Wacyk).
On January 1, 2018, the Fair Workplaces, Better Jobs Act, 2017 SO 2017, C 22 amended s. 4 to remove the requirement that the intent or effect of the arrangement as described in s. 4(1) must be to defeat, either directly or indirectly, the purpose of the ESA 2000 in order for the employer and other persons to be treated as one employer. If the business relationship existed before January 1, 2018, and the contravention occurred before January 1, 2018, the intent or effect test should be applied.
This part of s. 4(1) requires that either the intent or effect of the associated or related activities or businesses is to defeat the intent and purpose of the ESA 2000, either directly or indirectly. Therefore, it is not necessary to show that there is an intent to defeat the purpose of the ESA 2000, if the effect would be to defeat it.
Some examples of the application of the intent or effect criterion are as follows:
Someone carries on a growing business through a number of small corporations and sets up a new corporation every time an existing corporation's payroll starts getting close to $2.5 million, putting any new employees on the new corporation's payroll in an attempt to avoid the $2.5 million severance pay threshold. This is obviously being done with the intent of defeating the intent and purpose of the ESA 2000; accordingly, the several corporations should be treated as one and their individual payrolls all added together for purposes of determining whether severance pay must be paid to eligible employees whose employment has been severed.
Several numbered corporations in associated or related businesses, each with a payroll of less than $2.5 million, carryon under a single trade name and effectively operate as one so far as the general public and employees are concerned. Even if the motive behind having several corporations instead of one had nothing to do with trying to defeat the intent and purpose of the ESA 2000, it is clear that this could be the effect of the arrangement. Accordingly, the corporations would be treated as one and their individual payrolls added together for purposes of determining whether or not severance pay must be paid to eligible employees whose employment has been severed. It should be noted, however, that the payroll of a business that is located outside Ontario will not be added to the payroll of a related business in Ontario.
Corporation A, in an attempt to avoid the claims of its creditors, closes down its business and opens up a new one, Corporation B. Corporation A still legally exists, but is dormant. Corporation B is under the same management and ownership, performing the same or similar operations as the old corporation using funds diverted from the old corporation. It is clear that both corporations should be treated as one under s. 4(1) so that former employees of the old corporation may be paid wages that are owed to them.
Corporation A becomes insolvent and its employees are dismissed. Corporation B, which owns Corporation A and controlled A's operations, is not insolvent. Corporations A and B should be treated as a single employer, since the effect of the existence of two separate corporations, one insolvent and one not, would otherwise be to defeat the Act's intent, which is to enforce the payment of wages earned by employees.
Corporations A and B are both subsidiaries of Corporation C, and are both controlled by it. An employee works four years for Corporation A, then three years for Corporation B, and is terminated by Corporation B. A and B should be treated as a single employer under s. 4(1), in determining the employee's length of employment for the purposes of notice of termination and severance pay. To find otherwise would defeat the intent of the ESA 2000 to ensure that employees receive notice of termination and severance pay in accordance with their length of employment.
Corporations A and B are both owned by the same sole shareholder, who manages and controls both of them. Employees regularly move between the two corporations, which perform similar activities. An employee, in one week, works 40 hours for Corporation A and eight hours for Corporation B. The two corporations should be treated as a single employer under s. 4(1) in determining whether the employee is entitled to overtime pay since to do otherwise would defeat the ESA's intent which is to ensure that employees receive overtime for hours worked in excess of 44 per week.
Corporations A and B are owned by the same shareholders and have common officers and directors. Corporation B was incorporated for the purpose of acquiring a piece of real estate on which Corporation A conducts its manufacturing operations. B leases the property to A at less than fair market rent. Corporation A becomes bankrupt and is unable to pay its employees severance pay. A and B should be treated as one employer under s. 4(1), since even if intent to defeat the purpose of the ESA 2000 cannot be proven, it is clear that the effect of the arrangement would be to defeat the purpose of the ESA 2000, which is to ensure that employees receive severance pay that they have earned through long employment with the employer.
Corporation A and B had interlocking Boards of Directors, a common payroll system, intermingling of employees, and shared facilities. An employee was laid off by A and was made a reasonable offer of alternative employment by B, prior to the expiry of 13 weeks of lay-off. The employee refused the offer. A and B should be treated as one employer under s. 4(1), and the employee should be disentitled to termination pay, since it would be contrary to the Act for the employee to be able to refuse such an offer and still collect termination pay. See Chow v Penta Stolp Corporation (August 7, 1992), ES 128/92 (Wacyk), a decision under the former Employment Standards Act.
Where an employer becomes bankrupt it is not unusual for a phoenix
employer to emerge and commence operations, and very often the first part of the test (associatedness or relatedness) will be met because of common management, financial control or ownership as between the bankrupt and the phoenix.
However, in order to conclude that s. 4 applies, the second part of the test (i.e., the intent or effect of defeating the intent and purpose of the ESA 2000) must also be met. The ruling of the Divisional Court in Carillon Decorative Products Inc. v. Mellon, 2004 CanLII 1535 (ON SCDC) provides provides some guidance on the application of the second part of the test in phoenix situations.
The phoenix employer (Carillon) was a very small-scale, direct import operation with a total of five employees, all immediate family members of the owners; the bankrupt employer (Alderbrook) was primarily a manufacturing operation with approximately 250 employees. Before the incorporation of Carillon, the principals of Alderbrook had sought new financing from alternative sources and had even given personal guarantees to secure a forbearance from its bankers on repayment of money owed to the bank. After Alderbrook became bankrupt, the principals invested $45,000 (raised through mortgaging their homes) to start up Carillon; to keep Alderbrook going would have required a further investment of $2,000,000.
The Court assumed without deciding that the first part of the test has been met; however, with respect to the second part of the test, while the Court agreed that it would have been met had the principals simply walked away
from Alderbrook without making reasonable efforts to save it, the Court found that that was not the case. The principals had undertaken considerable efforts to save Alderbrook. In response to a suggestion that the principals might have invested the Carillon start-up capital in Alderbrook instead in an effort to keep Alderbrook going, the Court noted that the $45,000 in question would not have had the slightest effect on the looming disaster confronting Alderbrook.
Based in part on the Carillon decision, the Program takes the view that the intent or effect branch of the test will not be met in phoenix situations unless:
Section 4(2) provides that if the requirements of s. 4(1) are met, the employment standards officer must treat the associated or related activities or businesses as one employer. It is a deeming provision and does not provide for the exercise of discretion by the employment standards officer.
One effect of the non-discretionary
nature of the officer's application of s. 4(2) is that employees involved in a civil action against their employer may cite s. 4(2) in the action, arguing that if the requirements of s. 4(1) are met, the Act requires that the section be applied. An employee may propose this because an associated or related business may be better able to pay a judgment.
Section 4(3) clarifies that the test set out in s. 4(1) for relatedness may be met even if the activities or businesses are not carried on at the same time. For example, Corporation A operates from January 1, 2002, to January 1, 2003. Corporation B commences operations on February 1, 2003. If Corporation A and B have common directors, if the business of both corporations is identical and if the employees employed by Corporation A move to Corporation B at the time that Corporation B began doing business, a finding of relatedness may be made despite the fact that Corporations A and B did not operate at the same time. See, for example, the following decisions under the former Employment Standards Act: Refac Industrial Contractors Inc. v Haygood et al, 782368 Ontario Inc. o/a Consolidated Security Services v Powers, and Chatters Restaurant and Tavern Inc. and 791818 Ontario Ltd. o/a T.C. Mellons v Morrissey and Yarmoloy.
Section 4(4) ensures that s. 4(2) is not used to make a finding that Corporation A and the shareholders of Corporation A are related employers. To use s. 4(2) in this way would be to ignore the legal concept of the separate legal identity of corporations.
In law, a corporation is regarded as having a separate existence from the person or persons who own it. Ownership of a corporation is represented by shares. A person who owns more than 50 per cent of the shares is said to own a controlling interest in the corporation.
Section 4(4) establishes the one circumstance in which the legal concept of separate corporate personality (the corporate veil) can be pierced for the purposes of this section. If the shares of a corporation are held by the partners, and the partners, in turn, hold those shares for the purpose of the partnership, s. 4(2) may apply. Section 4(4) effectively prevents a partnership (which at law is not regarded as having a separate existence from the partners who form the partnership) from masquerading as a corporation.
This provision was introduced by the Fair Workplaces, Better Jobs Act, 2017 effective January 1, 2018, at the same time that s. 3.1 was added to the Act to provide that the Act binds the Crown. Subsection 4(4.1) states that ss. 4(2), which treats “related” entities as one employer under this Act, does not apply to the Crown, a Crown agency or an authority, board, commission or corporation all of whose members are appointed by the Crown.
The term Crown
refers to the government of Ontario. More precisely, it refers to the executive branch of government, as the term Crown does not include the Legislative Assembly or the judiciary.
The determination of whether an entity is a Crown agency and therefore exempted from the application of the s. 4 related employer provisions is generally made on the basis of the common law, which looks at the nature and degree of control which the Crown, through its Ministers, exercises over the entity. For example, see Westeel-Rosco Ltd. v Board of Governors of South Saskatchewan Hospital Centre, [1977] 2 SCR 238, 1976 CanLII 185 (SCC).
For a discussion about the meaning of “the Crown, a Crown agency or an authority, board, commission or corporation all of whose members are appointed by the Crown”, and the history of which provisions applied to the Crown, etc. at which point in time, see O. Reg. 285/01 s. 2.1.
Section 4(5) states that if persons are found to be one employer under s. 4(2), each person will be responsible for all the obligations under the ESA 2000 and regulations of all the other entities, separately and together.
Consider the example of entities A and B and an employee who became entitled to severance pay from entity A. Even if A and B did not become related until sometime after the employee became entitled to severance pay, entity B (as well as entity A) will still be liable for those monies under s. 4(2), if A and B are found to be a single employer under s. 4(2). However, by contrast, if an employee is terminated by employer A, which has a $2.0 million annual payroll, and subsequently A becomes related to employer B, which has a $1.0 million annual payroll, the employee will not be entitled to severance pay from either employer A or B, even though the combined payrolls exceed $2.5 million, the amount that triggers the entitlement to severance pay for an employee with five or more years' employment, under ESA Part XV, s. 64(2). The difference between the two situations is that, in the first situation, employer B is considered to have assumed the pre-existing employment standards obligations of employer A at the time they became related, whereas, in the latter, there was no pre-existing obligation for B to assume.
For a more detailed discussion, see the definition of person in ESA Part I, s. 1.
Section 5(1) prohibits employers, employees and their agents from waiving or contracting out of any employment standard provided by the Employment Standards Act, 2000, and nullifies and voids any such contracting out or waiver.
The prohibition in s. 5(1) is subject to s. 5(2). Accordingly, an employment standard need not be complied with if the employee is receiving a greater right or benefit with respect to that particular standard.
ESA Part I, s. 1 defines employment standard as follows:
Accordingly, the prohibition on contracting out applies only with respect to the ESA 2000’s provisions that confer a benefit to an employee not with respect to those provisions that confer a benefit on an employer. For example, the ESA 2000 will not prohibit an agreement between an employee and employer to waive the requirement for an employee to provide four weeks' notice of intention to resign at the end of a pregnancy and parental leave.
Numerous referees have dealt with situations in which an employer and employee have come to an arrangement, the effect of which is to waive an employment standard. Such arrangements have been declared void, even in cases where the employee vociferously supported the arrangement. The following decisions under the former Employment Standards Act are some examples of arrangements that have been found unacceptable:
In Arpin Trucking Limited v Proud (November 24, 1981), ESC 1108 (Sheppard), the employees agreed to work at a higher hourly rate than previously, but with no overtime premium. The referee decided that they could not waive the employment standard, despite the fact that none of the employees supported the assessment against the employer.
In Canecon Investments Inc., c.o.b. as G.M. Stamm, Economic Research Associates v Gillezeau (December 11, 1981), ESC 1117 (Bigelow), the referee did not accept the employer's argument that the employee had accepted a yearly salary that supposedly allowed for vacation and public holiday pay, as such an arrangement would have been a waiver of the relevant employment standards.
In James Fibre Glass Manufacturing Co. Limited v Lindsay (Wilson) (December 6, 1984), ESC 1752 (Adamson), the referee found that an oral agreement to work extra hours to make up lost time at regular pay was void, as such an arrangement was a waiver of the employee's right to overtime pay.
In London White Trucks Limited v Martel (May 30, 1977), ESC 425 (Picher), the employer told the employee that he was to be dismissed, and suggested that giving him notice . . . wouldn't be of any value…
, The referee held that the employee's agreement with the suggestion was a waiver of an employment standard. Accordingly, the referee declared the agreement void.
In Lindzon v Starr (June 27, 1979), ESC 635 (Picher), the referee held that the employee's written release of her employer from any claims she may have had against him was null and void, with the result that the employer was liable for pay in lieu of notice of termination.
Where an employment contract contains a provision that purports to waive the right to notice of termination under ESA Part XV, s. 57 and 58, this attempted waiver, being null and void, cannot be used to determine the question of whether the employee received reasonable notice at common law. In this regard, see Machtinger v HOJ Industries Ltd., [1992] 1 SCR 986, 1992 CanLII 102 (SCC).
However, the prohibition against contracting out under the ESA 2000 must be distinguished from the settlement of an entitlement under the ESA 2000. For example, under ESA Part III, s. 6, a union could agree to a settlement with respect to entitlements under the ESA 2000, including severance pay. A settlement is distinguished from an attempt to contract out of the ESA 2000 because it is entered into only with respect to an entitlement that has crystallized or whose crystallization is imminent.
Section 5(2) ensures that where an employee has greater rights under an employment contract (which includes a collective agreement) or another statute, such greater rights will prevail over the minimum standards established by the ESA 2000. Such greater rights include a greater hourly rate, lesser hours of work, a greater percentage of vacation pay, longer vacations, higher public holiday pay and a greater number of public holidays.
(Note that prior to April 3, 2019, section 17.2 of the ESA provided an exception to the application of s. 5(2). Section 17.2 was repealed on April3, 2019 as a result of the Restoring Ontario’s Competitiveness Act, 2019. Before its repeal, ESA Part VII, s. 17.2 provided that even where a contract gave an employee a greater right than all or part of the hours of work provisions in the ESA 2000, employers were still required to comply with the requirement that existed at the time to obtain the approval of the Director of Employment Standards (or to have an application for approval pending for at least 30 days, as well as meeting certain other conditions) before the employer's employees could work in excess of the weekly limit on hours of work.)
Consistent with s. 5(2), the Program takes the position that in determining whether the employment contract confers a greater right or benefit, one should not compare apples with oranges, i.e., the fact that a contractual provision or set of contractual provisions relating to the same subject matter as one employment standard provides a greater benefit to employees than that employment standard cannot be used to justify giving employees less than they are entitled to under a different employment standard. For example, the fact that an employee is paid considerably more than the minimum wage does not allow the employer to avoid paying overtime pay.
There is, however, some indication that the Board may take a different view. In Track-Corp Equipment Ltd. v Tremblay, 2007 CanLII 15165 (ON LRB), the employee had agreed to work for a flat rate of $19 per hour, purportedly inclusive of any entitlements to overtime pay, public holiday pay and vacation pay. Following the termination of his employment, he filed a complaint with the ministry. The investigating employment standards officer, finding that the employee was owed overtime pay, public holiday pay and vacation pay, issued an order to pay, which the employer appealed. The Board allowed the appeal. Noting that the employee had been paid over $12,000 during his time with the employer, and that if his rate of pay had been only the minimum wage in effect during that time ($7.45 per hour), his total entitlement, including overtime pay, public holiday pay and vacation pay, would have been just over $5,000, the Board held that:
In other words, it seems that the Board, rather than comparing the benefit conferred by the contractual rights pertaining to the same subject as one particular employment standard with the benefit that would be conferred by that standard, compared the total benefit of the entire contract with the total benefit of all employment standards. The Program's position is that this is not an appropriate approach to take as it would have the effect of depriving virtually any employee earning significantly more than minimum wage of all of their other entitlements under the ESA 2000.
The correct approach, in the Program's view, is that which was taken in C. Fasano Food Market v Bouvier (February 20, 1978), ESC 482 (Satterfield), where the referee rejected an employer's argument that it did not have to comply with the former Employment Standards Act's public holiday provisions because certain payments it had made to the employee for time not worked, voluntary cash payments and payment in trade were a greater benefit to the employee than the employment standard. In responding to that argument, the referee stated:
While the wording of the predecessor greater right or benefit provision is somewhat different than the current provision, the Program is of the view that the differences are not significant and that the approach taken in the C. Fasano Food Market v Bouvier decision is still the appropriate approach to greater right or benefit issues.
Although the Program is of the view that one cannot compare apples with oranges in determining whether a greater right or benefit is being provided, one can compare different varieties of apples. This means that one takes into account the entire package of contractual provisions that relate to the same subject as a particular employment standard. In some cases, this will require a comparison of both monetary and non-monetary aspects. For example, where the issue is whether the employment contract confers a greater right or benefit in relation to holidays than Part X, one would look at several features, including the number of holidays recognized, qualifying conditions, whether there is a right to be off work on a holiday, premium pay entitlements for working on a holiday, etc. A Divisional Court decision under the former Employment Standards Act, Re Queen's University and Fraser et al, 1985 CanLII 2260 (ON SC), indicated that this was the proper approach.
This approach gives the employer some flexibility where they are giving a contractual right that on balance is better overall for employees than the corresponding statutory standard, notwithstanding that the contractual right is not better in all respects or perhaps not even as good in some. Note that in order for a contractual provision to be found to prevail over an employment standard under s. 5(2), the right or benefit conferred by the provision must be in fact greater and not merely equal.
It is not a greater benefit for an employee to receive payment in lieu of the required rest periods in ESA Part VII, s. 18 and ESA Part VIII, s. 20. The benefit provided by these required rest periods in the ESA 2000 is time off from work. Therefore, the appropriate comparison to determine whether a greater right or benefit has been provided to an employee with respect to these rest periods is the time off from work. Payment in lieu of time off from work, premium pay for working additional hours or the willingness of the employee to work extra hours are not relevant considerations for the determination of a greater right of benefit for rest periods.
An employer may provide a greater right or benefit with respect to eating periods than that provided under ESA Part VII, ss. 20 and 21. For example, the contract may provide that the employee will be entitled to an hour long eating period within the time limits set out in ESA Part VII, ss. 20(1) and (2).
It is not a greater benefit for an employee to receive payment in lieu of the required eating period. The benefit provided by the eating period in the ESA 2000 is time off from work. Therefore, the appropriate comparison to determine whether a greater right or benefit has been provided to an employee with respect to the eating period is the time off from work.
In All-Way Transportation Services Ltd v Fountain (June 6, 1979), ESC 627 (Brent)the employer argued that an arrangement that allowed wait staff to continue to earn tips constituted a greater right or benefit. The Board, in rejecting that argument, said:
Working cannot be considered a greater right or benefit than not working just because the employee is getting paid. If that were possible, any employer could refuse to give meal breaks as long as the employee was paid. It is implicit in the Act that the break itself is the benefit.
In Falconbridge Nickel Mines Limited v Sudbury Mine, Mill and Smelter Workers' Union, Local 598 (July 13, 1981), ESC 1021 (Egan), a hearing was held on the issues of, first, the meaning of “week” in the overtime provisions in s. 25 of the former Employment Standards Act, which corresponds to ESA Part VIII, s. 22, and, second, the meaning of greater right or benefit, collective agreement versus the ESA 2000.
The work week of the employer was established and commenced at 8:00 a.m. Sundays, and was based on a set schedule over a four-week cycle, a series of seven consecutive eight-hour days worked over two work weeks. The union argued that week in former s. 25 referred to any period of seven consecutive days and that, accordingly, overtime was not being paid properly pursuant to the Act's requirement of one and one-half times the regular rate after 44 hours in the week, notwithstanding that overtime was paid, in accordance with the collective agreement entitlement, after 40 hours in a work week. The referee did not accept the employer's argument that week in s. 25 meant work week, but rather held that it means any period of seven consecutive days. Further, he held that since the overtime provisions of the collective agreement, being a package of rights involving premium pay after 40 hours per week, eight hours per day, on Sundays, and call-in pay, did not specifically relate to the particular s. 25(1) overtime standard in a week (being seven consecutive days), it could not be compared.
On judicial review, the Divisional Court in the unreported decision Re Falconbridge Nickel Mines Ltd. and Egan et al (January 18, 1982), (ON SCDC) found that the referee made an incorrect construction of week in s. 25 and of s. 4(2) of the former Employment Standards Act, which corresponds to s. 5(2). The Court determined that the employer has established a work week, the reference to week in s. 25 means the seven-day period which coincides with the work week. The Court also ruled that the referee was obligated by s. 4(2) to compare the rights, benefits, terms or conditions of the collective agreement relative to overtime
with s. 25, which was the entire statutory provision regarding overtime.
In Re Falconbridge Nickel Mines Ltd. and Egan et al., 1983 CanLII 1931 (ON CA), the majority of the Court of Appeal affirmed the Divisional Court's decision on the interpretation of the s. 25(1) week issue, but did not comment on the s. 4(2) holding. However, the Divisional Court relied on this form of package comparison having been acceptable when they confirmed that approach in Re Queen's University and Fraser et al.
The fact that a contract of employment may provide for overtime payable after eight hours per day or 40 hours per week does not necessarily render it a greater benefit than that contained in ESA Part VIII, s. 22(1). The entire package must be examined. For example, an employee is paid an hourly rate and an amount for mileage and the collective agreement provides for time and one-half after 40 hours. The collective agreement may at first appear to be providing a greater right or benefit. However, the collective agreement also contains a provision stating that the hours of work in respect of which mileage is paid will not count as hours of work for the purposes of calculating overtime. In the event that pay for mileage plus regular pay plus overtime pay as per the collective agreement is less than the wages otherwise due had ESA Part VIII, s. 22(1) applied, then s. 5(2) would not apply and the ESA 2000's minimum standard would be operative.
Where a contract of employment (including a collective agreement) provides for greater remuneration than the minimum wage, that greater remuneration prevails over the minimum wage requirements of the ESA. An employment standards officer can assess and enforce the greater remuneration.
Where an employee has greater benefits under an employment contract or collective agreement with respect to public holidays, such greater benefits prevail over the minimum requirements in the ESA.
For example, if an employee's employment contract grants the employee more money for a public holiday than does the calculation of public holiday pay under the ESA, the employee is entitled to that higher amount. For example, the calculation for public holiday pay under the ESA is based on regular wages earned and vacation pay payable, but if that employee's employment contract provides for public holiday pay calculated using all wages earned in the four work weeks, the employee is entitled to that higher amount.
Another example is if an employer's requirements for public holiday pay are not as stringent as those in the ESA 2000, an employee is entitled to that pay if they fulfil those less stringent requirements. In Sturdell Industries Limited v Wilson (March 13, 1979), ESC 593 (Johnston), a case decided under the former Employment Standards Act, employer policy provided for a paid holiday even if the employee did not work the regularly scheduled day after the holiday, as long as they subsequently made up any lost time. The referee held that the employer could not retroactively tighten up
the system and attempt to recover holiday pay that it paid, even though the employee would not have been entitled to the pay under the Public Holiday provisions.
In the context of collective agreements, arbitrators have held as follows:
In Canada Cement Lafarge Ltd. v. C.L.G.W., the arbitrator held that a collective agreement under which employees in a continuous operation would receive premium pay of 2 1/2 to 3 1/2 times the regular rate for work on 12 holidays provided a greater benefit than the Act. Accordingly, the agreement prevailed, since the package as a whole was considered to exceed the requirements of the Act.
In Re Queen's University and Fraser et al, the Divisional Court held that no illegality results from the fact that a collective agreement does not treat a particular day (being a public holiday under the ESA 2000) as the holiday, so long as the collective agreement provisions respecting holidays provide a greater right or benefit in total than the provisions of the Act.
Note that while these cases were all decided under the former Employment Standards Act, the principles enunciated in the decisions still apply.
Whether dealing with an individual employment contract or a collective agreement, the entire public holiday package, including monetary and non-monetary aspects and the stringency of qualifying conditions, must be reviewed. In order to find that the terms of a contract or collective agreement prevail over the ESA 2000, they must be on balance not just equal to the ESA 2000, but must provide a greater benefit.
The Divisional Court upheld the package approach in Re Queen's University and Fraser et al, where Madame Justice Van Camp, speaking for the majority stated,“One must look at the entirety of the terms in the agreement respecting holidays and not compare each individual item.”
The Program's position is that factors that must be considered when assessing whether a contract provides a greater right or benefit with respect to public holidays include:
Historically, one view of the public holiday entitlement has been that such days are intended to be a common day free from work, to facilitate religious or traditional public celebrations or to spend time with family. As one aspect of the entitlement, it should be considered as one of the factors in determining whether the entitlements under the employment contract provide a greater right or benefit.
Consequently, applying the greater right or benefit provisions of the ESA 2000 could result in a finding that an employment contract provides a package related to public holidays that will prevail over the public holiday entitlements in the ESA 2000, even though the package does not treat for example Family Day, or indeed any one or more of the other public holidays under the ESA 2000, as a public holiday.
In order for a non-statutory benefit respecting public holidays to prevail over Part X provisions, the conditions of employment must confer a greater benefit in relation to the statutory public holiday employment standard and they will only prevail in respect of that standard. The employer cannot rely on a greater benefit in respect of one standard to offset a lesser benefit in respect of another standard.
In C. Fasano Food Market v Bouvier (a decision under former Employment Standards Act), the referee ordered the employer to pay public holiday pay even though he paid for time not worked (sick leave and personal time-off), voluntary cash bonuses and payment in trade, all of which amounted to a figure well in excess of the amount of the order to pay.
In 22 Employees v Christie's Dairy Limited (July 23, 1981), ESC 1030 (Sheppard) (a decision under the former Employment Standards Act), the referee ordered the employer to pay public holiday pay even though he had reduced the employees' work week from a five-day, eight hours per day week (40 hours total) to a four-day, nine hours per day week (36 hours total) with no reduction in salary. He had argued that this new arrangement was a better benefit, so he was justified in not paying premium pay for work on public holidays, especially as the employees had fully consented to the change. The referee did not agree with this argument.
In some cases, the terms of a collective agreement or individual contract of employment provide for an employee to receive, in addition to their regular earnings, a percentage of those earnings in lieu of public holiday pay for public holidays not worked, or more typically, in lieu of a number of entitlements and benefits including public holiday pay. Since in such cases the employer is not adhering to the public holiday requirements per se, the employer cannot be considered to be in compliance with the ESA 2000 unless the percentage in lieu arrangement constitutes a greater right or benefit within the meaning of s. 5.
In order to determine whether a percentage in lieu arrangement constitutes a greater right or benefit, one must compare what the employee receives in lieu of public holiday pay with what the employee would have received had the employer paid public holiday pay in accordance with ESA Part X. Only if the former exceeds the latter can it be said that a greater right or benefit is being provided.
Where the amount paid under the arrangement is solely in lieu of public holiday pay (and not in lieu of other entitlements or benefits as well), the determination is made by comparing the percentage in lieu figure with the percentage that public holiday pay would have represented had the employer paid public holiday pay in accordance with Part X. This latter percentage may vary for a particular employee from holiday to holiday and year to year, depending, for example, on whether the employee was away from work in the four work weeks before the work week in which the public holiday occurred.
Where the amount paid under the arrangement is in lieu of other entitlements or benefits as well as public holiday pay, one must still determine the appropriate bench mark percentage to determine whether a greater right or benefit is being provided and compare that with the percentage in lieu of public holiday pay provided by the employer.
If the contract or collective agreement breaks down the total percentage in lieu to show how much of it is being provided in lieu of public holiday pay, that is the figure that should be compared with the benchmark.
Where the contract or collective agreement does not break down the total percentage, it will have to be determined whether or not the percentage in lieu is sufficient to fund all the benefits and entitlements it is intended to cover. If it is not sufficient, then the percentage in lieu does not constitute a greater right or benefit than ESA Part X.
In some cases, employees may receive a percentage in lieu for public holidays not worked, but still receive regular wages plus premium pay for any holidays that they do happen to work. Where this occurs, the amount paid for public holiday work may have to be taken into account along with the percentage in lieu in order to determine whether the employee received a greater right or benefit than what they would have received had the employer complied with ESA Part X in all respects. However, if the appropriate benchmark figure is exceeded on the basis of the principles discussed in the preceding paragraphs even without consideration of the amount paid for public holiday work, it is not necessary to take this additional step.
It must be clear from the contract of employment exactly what the greater entitlement is before it is enforced. For example, although a contract may provide a greater benefit of four weeks' vacation time, this does not necessarily mean that a corresponding increase (e.g., to eight per cent) in the percentage of vacation pay can be enforced. However, if a contract of employment does provide a greater percentage for vacation pay, that greater percentage will be enforced even if the employee does not complete the vacation entitlement year, unless the entitlement to the greater percentage is clearly dependent upon that completion.
Questions regarding the application of s. 5(2) may arise in the context of pregnancy and/or parental leave when an employee, who has taken time off that exceeds the leave periods under the ESA 2000, seeks the assistance of the Program in returning to work.
In many cases, employers are prepared to allow employees to take additional time off following the statutory leave. In fact, such arrangements are often individually tailored to suit a specific employee's needs rather than appearing as a standard contract entitlement. Nothing in the ESA 2000 prohibits employers from agreeing to allow an employee to take additional time off or otherwise negotiating a discrete, non-statutory leave entitlement as a term of the contract of employment. But, in either case, the terms of that extended period of time off or discrete, non-statutory leave would not be subject to scrutiny or enforcement under the ESA 2000. Most importantly, the rights of reinstatement afforded under the ESA 2000 are not enforceable at the end of the extended period of leave or following a discrete, non-statutory leave.
However, if the leave as provided under the terms of the contract is determined to be a greater right or benefit than the statutory leave entitlement, the terms of the leave under the contract of employment will apply and can be enforced.
In determining whether a contract provides a greater right or benefit with respect to leave, one must examine and compare the entire package of contractual provisions that relate to the package of leave provisions under the ESA 2000. However, one essential element of the package will be reinstatement in some form, as the concept of a leave from work necessarily implies a right to return to work.
It may not be necessary for the rights of reinstatement afforded under the contract provisions to be precisely the same as those afforded under the ESA 2000. For example, the contract provision may allow an employee to take reinstatement at the end of the statutory leave period in accordance with ESA Part XIV, s. 53, but limit the employee's rights to reinstatement following a period of leave that is longer than the statutory requirements, to reinstatement to a comparable job only. An officer would need to review all of the terms and conditions of the contractual provisions before concluding that there was a greater right or benefit but it would be open to an officer to conclude that a contract provides a greater right or benefit, despite the fact the employee seeking reinstatement at the end of the longer period of leave would be entitled only to a comparable job as per the contract.
Further, where an employer provides a greater right or benefit with respect to statutory leave in that the employment contract offers a period of pregnancy or parental leave that is greater than the statutory minimum, it will not necessarily mean that rights collateral to the statutory leave period such as participation in benefit plans and accrual of length of service, employment and seniority will automatically apply to that greater period of leave.
As an example, an employee had a right under her contract to extend her leave for an additional 26 weeks following the 78 week period of combined pregnancy and parental leave under the ESA 2000. However, if she does so, she will not accrue credit for seniority for that 26 week period. All other rights afforded under the statutory leave provisions continue to apply for the additional 26 week period. In that case, an officer may find that the leave provisions in the contract provide a greater right or benefit because the employee has all the rights afforded under the ESA 2000 for the period equivalent to the statutory leave as well as a right to a longer leave, despite the fact the contract provisions do not extend the right to accrue credit for seniority for that period of leave exceeding the statutory entitlement.
Determining whether the provisions of an employment contract provide a greater right or benefit than ESA Part XIV, s. 50 in relation to time off work because of personal illness, injury or medical emergency can be a difficult matter. The principle that applies in making the determination is the same principle that governs in any greater right or benefit determination, i.e., do the relevant contractual provisions, taken in their entirety, give the employee a better deal than the corresponding employment standard taken in its entirety.
In order to provide assistance in determining whether the employment contract is providing a greater right or benefit than sick leave under the ESA 2000, the following list of criteria has been developed. In any given case, some criteria might point one way, while some might point the other; bearing in mind, however, that the question to be answered is whether the contractual leave provisions, taken in their entirety, give the employee a better deal than ESA 2000’s sick leave provisions, taken in their entirety. The contractual scheme should be examined in light of all of the criteria and then considered whether, on balance, it is the contract or the ESA 2000 that provides the better deal for the employee. Note, however, that the various criteria are not all of equal significance; while no single criterion is likely to be conclusive in itself, some are much more important than others. The criteria set out below have been listed in the order of their importance.
Note that if an employee who takes what is purported to be leave under the contract has no actual entitlement to return to work, the leave under the contract will NOT be considered to be a greater right or benefit. This is because it is inherent in the concept of a leave that there is an entitlement to return; a supposed leave without such an entitlement is meaningless.
How many days of leave does the contract provide for? If the contract provides for fewer than three days’ leave per calendar year, the leave under the contract will NOT be considered to be a greater right, since even only one day less leave under the contract constitutes such a significant reduction in the entitlement. For example, if a contract provides for only two days of sick leave, an employee’s entitlement to sick leave would be reduced by a full one-third if that contract were to be considered to be a greater right or benefit. On the other hand, an unlimited leave entitlement, or an entitlement to more than the three days per calendar year that the ESA 2000 provides for, weighs in on the side of concluding that there is a greater right or benefit.
Does the contract cover all the different types of events that would entitle an employee to sick leave under ESA Part XIV, s. 50? For example, does the contract allow the employee days for a medical emergency but not for personal injury? If so, it would be a very strong indication that the contract does not provide a greater right or benefit.
Is the leave under the contract paid leave? None of the days of sick leave are paid under the ESA 2000, so if the leave under the contract is paid leave, this tends to point to the contract providing a greater right or benefit. But as with the other criteria, this criterion is not conclusive in itself; other criteria might tip the balance the other way.
As stated above, if an employee who takes what is purported to be leave under the contract has no actual entitlement to return to work, the leave under the contract will NOT be considered to be a greater right or benefit. This is because it is inherent in the concept of a leave that there is an entitlement to return; a supposed leave without such an entitlement is meaningless.
If the employee takes leave under the contract, are they entitled to return to their original position (assuming it still exists), as they would be if they took sick leave under the ESA 2000? While it is unlikely, as a practical matter, that a short-term absence would result in the employee being moved to another position, it is quite conceivable that an employer might make such a move if there were repeated absences, and the new position might not even be comparable. If the employee does not have a right to return to their original position if it still exists, or to be placed in a comparable position if it does not, this would be a factor tending to suggest that a greater right or benefit is not being provided.
Even if the employee has a right to their original job, can the employee be adversely affected in any other way because they take leave under the contract? For example, the employee might have an entitlement under the contract to take leave and keep the original job, but they might lose out in other ways, e.g., the absence from work may cause them to be ineligible for a perfect attendance bonus, or the absence from work may be included when determining whether the employee has triggered an absence threshold that results in termination. This points in the direction of the contract not providing a greater right or benefit. See the discussion of the impact of statutory leaves on attendance management programs and perfect attendance bonuses at ESA Part XIV, s. 52(1).
Other examples of negative consequences that would point in the same direction include interruption in certain kinds of benefit coverage, deduction of leave time from seniority, and forfeiture of contractual vacation entitlement because the leave results in the vacation being postponed beyond the last allowable date for taking vacation under the contract.
A number of other criteria, although comparatively minor in importance, could conceivably have some impact on the greater right or benefit determination. These criteria include:
Although none of these criteria may be greatly important in themselves, they could tip the balance one way or the other in a close case. In some cases these criteria may be more important – for example, if the contract contained a six-month length of employment requirement in order to be eligible for the leave, that criteria would be a factor strongly tending to suggest that a greater right or benefit is not being provided to an employee who has not met the six-month requirement. If a contract does provide a greater right or benefit than ESA Part XIV, s. 50 provides, the terms of the contract will apply instead of ESA Part XIV, s. 50. That is, the terms of the contract, not ESA Part XIV, s. 50, will govern how absences are treated how many the employee is entitled to, what situations will trigger an entitlement, what evidence of eligibility may be required, whether or not they are paid, etc. On the other hand, if a contract does not have any period of employment requirement and provides everything the ESA provides (which means, for example, that all of the rights under the General Provisions Concerning Leaves and the anti-reprisal protection would apply to the absences) this would strongly tend to suggest that a greater right or benefit is being provided.
If a contract does not provide a greater right or benefit than ESA Part XIV, s. 50 provides, ESA Part XIV, s. 50 will apply.
Note that pursuant to ss. 50(7) – (9), where an employee opts to take a contractual leave that is not a greater right or benefit than s. 50, in circumstances that would also give rise to an entitlement under s. 50, the Act deems the contractual leave to be a s. 50 sick leave. See the discussion at subsections 50(7) – (9) for more information.
Determining whether the provisions of an employment contract provide a greater right or benefit than ESA Part XIV, s. 50.0.1 (family responsibility leave) and s. 50.0.2 (bereavement leave) in relation to time off work because of the death or illness, injury or medical emergency of a relative or an urgent matter concerning a relative can be a difficult exercise. The principle that applies in making the determination is the same principle that governs in any greater right or benefit determination, i.e., do the relevant contractual provisions, taken in their entirety, give the employee a better deal than the corresponding employment standard taken in its entirety.
In order to provide assistance in determining whether the employment contract is providing a greater right or benefit than family responsibility leave or bereavement leave under the ESA 2000, the following list of criteria has been developed. In any given case, some criteria might point one way, while some might point the other; bearing in mind, however, that the question to be answered is whether the contractual leave provisions, taken in their entirety, give the employee a better deal than the ESA 2000’s family responsibility leave or bereavement leave provisions, taken in their entirety. Note, however, that the various criteria are not all of equal significance; while no single criterion is necessarily conclusive in itself, some are much more important than others. Whether the employment contract covers all of the types of events referred to in ESA Part XIV, s. 50.0.1 or s. 50.0.2 should be given far more weight than, for example, whether the contract would allow the employee to take family responsibility leave because their spouse's step-grandparent was ill. The criteria set out below have been listed in the order of their importance.
Note that if an employee who takes what is purported to be leave under the contract has no actual entitlement to return to work, the leave under the contract will NOT be considered to be a greater right or benefit. This is because it is inherent in the concept of a leave that there is an entitlement to return; a supposed leave without such an entitlement is meaningless.
How many days of leave does the contract provide for? If the contract provides for fewer than three days’ leave per calendar year for family responsibility purposes, or fewer than two days’ leave per calendar year for bereavement, the leave under the contract will NOT be considered to be a greater right, since even only one day less leave under the contract constitutes such a significant reduction in the entitlement. For example, if a contract provides for only two days of leave for family responsibility purposes, an employee’s entitlement to family responsibility leave would be reduced by a full one-third if that contract were to be considered to be a greater right or benefit. If the contract provides for only one day of leave for bereavement, an employee’s entitlement to bereavement leave would be reduced by one-half if that contract were to be considered a greater right or benefit. On the other hand, an unlimited leave entitlement, or an entitlement to more than the three or two days per calendar year that the ESA 2000 provides for, weighs in on the side of concluding that there is a greater right or benefit.
Does the contract cover all the different types of events that would entitle an employee to family responsibility leave under ESA Part XIV, s. 50.0.1? For example, if the contract allows the employee family responsibility leave for the illness of a dependent relative, but not an urgent matter, this is a very strong (though not in itself conclusive) indication that the contract does not provide a greater right or benefit.
Is the leave under the contract paid leave? Neither family responsibility nor bereavement leave are paid leaves under the ESA 2000. So, if the leave under the contract is a paid leave, this tends to point to the contract providing a greater right or benefit. But as with the other criteria, this criterion is not conclusive in itself; other criteria might tip the balance the other way.
As stated above, if an employee who takes what is purported to be leave under the contract has no actual entitlement to return to work, the leave under the contract will NOT be considered to be a greater right or benefit. This is because it is inherent in the concept of a leave that there is an entitlement to return; a supposed leave without such an entitlement is meaningless.
If the employee takes leave under the contract, are they entitled to return to their original position (assuming it still exists), as they would be if they took family responsibility or bereavement leave under the ESA 2000? While it is unlikely, as a practical matter, that a short-term absence would result in the employee being moved to another position, it is quite conceivable that an employer might make such a move if there were repeated absences, and the new position might not even be comparable. If the employee does not have a right to return to their original position if it still exists, or to be placed in a comparable position if it does not, this would be a factor tending to suggest that a greater right or benefit is not being provided.
Even if the employee has a right to their original job, can the employee be adversely affected in any other way because they take leave under the contract? For example, the employee might have an entitlement under the contract to take leave and keep the original job, but they might lose out in other ways, e.g., the absence from work may cause them to be ineligible for a perfect attendance bonus, or the absence from work may be included when determining whether the employee has triggered an absence threshold that results in termination. This points in the direction of the contract not providing a greater right or benefit. See the discussion of the impact of statutory leaves on attendance management programs and perfect attendance bonuses at ESA Part XIV, s. 52(1).
Other examples of negative consequences that would point in the same direction include interruption in certain kinds of benefit coverage, deduction of leave time from seniority, and forfeiture of contractual vacation entitlement because the leave results in the vacation being postponed beyond the last allowable date for taking vacation under the contract.
With respect to entitlement to leave for death or illness, injury, medical emergency or urgent matters concerning certain relatives, how does the contractual right compare with family responsibility or bereavement leave under the ESA 2000, insofar as scope of coverage is concerned? ESA Part XIV, s. 50.0.1 and s. 50.0.2 provide an entitlement in relation to a fairly broad range of expressly designated relationships, including some that might be considered fairly remote (e.g., foster parent of the employee's spouse); moreover, the entitlement also extends to dependent relatives even if they do not fall into any of the named categories. If the contractual entitlement covers a narrower range of relationships (e.g., members of the employee's immediate family only), this weighs in on the side of concluding that it does not constitute a greater right or benefit. However, if, for example, a contractual entitlement for bereavement leave may be used in relation to any death - including that of a non-relative- it tends to suggest that this may be a greater right than ESA bereavement leave.
A number of other criteria, although comparatively minor in importance, could conceivably have some impact on the greater right or benefit determination. These criteria include:
Although none of these criteria may be greatly important in themselves, they could tip the balance one way or the other in a close case. In some cases these criteria may be more important – for example, if the contract contained a six-month length of employment requirement in order to be eligible for the leave, that criteria would be a factor strongly tending to suggest that a greater right or benefit is not being provided to an employee who has not met the six-month requirement. On the other hand, if a contract does not have any period of employment requirement and provides everything the ESA provides (which means, for example, that all of the rights under the General Provisions Concerning Leaves and the anti-reprisal protection would apply to the absences) this would strongly tend to suggest that a greater right or benefit is being provided.
If a contract does provide a greater right or benefit than ESA Part XIV, s. 50.0.1 or s. 50.0.2 provides, the terms of the contract will apply instead of the ESA leave provision. That is, the terms of the contract, not ESA Part XIV, s. 50.0.1 or s. 50.0.2, will govern how absences are treated how many the employee is entitled to, what situations will trigger an entitlement, whether or not they are paid, etc.
Note that pursuant to ss. 50.0.1(8) – (10), where an employee opts to take a contractual leave that is not a greater right or benefit than s. 50.0.1, in circumstances that would also give rise to an entitlement under s. 50.0.1, the Act deems the contractual leave to be a s. 50.0.1 family responsibility leave. The same applies in the bereavement leave context. Pursuant to ss. 50.0.2(8) – (10) , where an employee opts to take a contractual leave that is not a greater right or benefit than s. 50.0.2, in circumstances that would also give rise to an entitlement under s. 50.0.2, the Act deems the contractual leave to be a s. 50.0.2 bereavement leave.
Determining whether the provisions of an employment contract provide a greater right or benefit than ESA Part XIV, s. 50 (personal emergency leave) in relation to time off work because of personal illness, the death or illness of a relative or an urgent matter concerning a relative can be a very difficult exercise. The principle that applies in making the determination is the same principle that governs in any greater right or benefit determination, i.e., do the relevant contractual provisions, taken in their entirety, give the employee a better deal than the corresponding employment standard taken in its entirety.
However, in the case of personal emergency leave, the determination is much more complicated than it is in the case of other employment standards because of the very wide range of events referred to in section 50, the large number of features of the statutory right (e.g., reinstatement right, prohibition against penalization) and the virtually limitless variation in contractual entitlement schemes.
In order to provide assistance in determining whether the employment contract is providing a greater right or benefit than personal emergency leave under the ESA 2000, the following list of criteria has been developed. In any given case, some criteria might point one way, while some might point the other; bearing in mind, however, that the question to be answered is whether the contractual leave provisions, taken in their entirety, give the employee a better deal than the ESA 2000’s personal emergency leave provisions, taken in their entirety. The contractual scheme should be examined in light of all of the criteria and then considered whether, on balance, it is the contract or the ESA that provides the better deal for the employee. Note, however, that the various criteria are not all of equal significance; while no single criterion is likely to be conclusive in itself, some are much more important than others. Whether the employment contract covers all of the types of events referred to in ESA Part XIV, s. 50 should be given far more weight than, for example, whether the contract would allow the employee to take leave because their spouse's step-grandparent was ill. The criteria set out below have been listed in the order of their importance.
Note that if an employee who takes what is purported to be leave under the contract has no actual entitlement to return to work, the leave under the contract will NOT be considered to be a greater right or benefit. This is because it is inherent in the concept of a leave that there is an entitlement to return; a supposed leave without such an entitlement is meaningless.
Does the contract cover all the different types of events that would entitle an employee to personal emergency leave under ESA Part XIV, s. 50? For example, if the contract allows the employee personal sick leave and bereavement leave but does not allow any leave for the illness of, or urgent matter concerning, a dependent relative, this is a very strong (though not in itself conclusive) indication that the contract does not provide a greater right or benefit.
How many days of leave does the contract provide for? Obviously, if the contract provides for something less than 10 days' leave per calendar year, this weighs in on the side of concluding that it does not constitute a greater right or benefit. On the other hand, an unlimited leave entitlement, or an entitlement to more than the ten days per calendar year that the ESA 2000 provides for, weighs in on the side of concluding that there is a greater right or benefit.
Is the leave under the contract paid leave? Only the first two days of leave are paid under the ESA 2000 and the remaining eight days are unpaid, so if the leave under the contract is paid leave, this tends to point to the contract providing a greater right or benefit. But as with the other criteria, this criterion is not conclusive in itself; other criteria might tip the balance the other way.
If the employee takes leave under the contract, are they entitled to return to their original position (assuming it still exists), as they would be if they took personal emergency leave under the ESA 2000? While it is unlikely, as a practical matter, that a short-term absence would result in the employee being moved to another position, it is quite conceivable that an employer might make such a move if there were repeated absences, and the new position might not even be comparable. If the employee does not have a right to return to their original position if it still exists, or to be placed in a comparable position if it does not, this would be a factor tending to suggest that a greater right or benefit is not being provided.
Even if the employee has a right to their original job, can the employee be adversely affected in any other way because they take leave under the contract? For example, the employee might have an entitlement under the contract to take leave and keep the original job, but they might lose out in other ways, e.g., the absence from work may cause them to be ineligible for a perfect attendance bonus, or the absence from work may be included when determining whether the employee has triggered an absence threshold that results in termination. This points in the direction of the contract not providing a greater right or benefit. See the discussion of the impact of statutory leaves on attendance management programs and perfect attendance bonuses at ESA Part XIV, s. 52(1).
Other examples of negative consequences that would point in the same direction include interruption in certain kinds of benefit coverage, deduction of leave time from seniority, and forfeiture of contractual vacation entitlement because the leave results in the vacation being postponed beyond the last allowable date for taking vacation under the contract.
With respect to entitlement to leave for death or illness of or urgent matters concerning certain relatives, how does the contractual right compare with personal emergency leave under the ESA 2000, insofar as scope of coverage is concerned? ESA Part XIV, s. 50 provides an entitlement in relation to a fairly broad range of expressly designated relationships, including some that might be considered fairly remote (e.g., foster parent of the employee's spouse); moreover, the entitlement also extends to dependent relatives even if they do not fall into any of the named categories. If the contractual entitlement covers a narrower range of relationships (e.g., members of the employee's immediate family only), this weighs in on the side of concluding that it does not constitute a greater right or benefit.
A number of other criteria, although comparatively minor in importance, could conceivably have some impact on the greater right or benefit determination. These criteria include:
evidence reasonable in the circumstances, which is what the employer is entitled to ask for under ESA Part XIV, s. 50(10)?
Although none of these criteria may be greatly important in themselves, they could tip the balance one way or the other in a close case.
If a contract does provide a greater right or benefit than ESA Part XIV, s. 50 provides, the terms of the contract will apply instead of ESA Part XIV, s. 50. That is, the terms of the contract, not ESA Part XIV, s. 50, will govern how absences are treated how many the employee is entitled to, what situations will trigger an entitlement, whether or not they are paid, etc.
If a contract does not provide a greater right or benefit than ESA Part XIV, s. 50 provides, ESA Part XIV, s. 50 will apply. Any issue as to the application of the contractual leave terms will not be an issue for the employment standards program.
For example, a contract provides for three paid personal sick leave days and three paid bereavement leave days per year. There is no provision for job-protected time off (paid or unpaid) for any other reason listed in s. 50 (e.g., to tend to a sick child or a spouse with an urgent matter). It is the Program's view that this contract does not provide a greater right or benefit than ESA Part XIV, s. 50 provides. Accordingly, s. 50 will apply. An employee will have the right to two days of paid leave and eight days' unpaid leave per calendar year for any of the reasons listed in ESA Part XIV, s. 50. Assume the employee takes 10 days of personal emergency leave for personal illness. The employee will have no further personal emergency leave entitlements under the ESA 2000. The question of whether the personal emergency leave absences will also draw down against the contractual right of three paid sick days is not a matter for the employment standards program.
Similar considerations as those listed above apply in the context of family medical leave, family caregiver leave, critical illness leave, domestic or sexual violence leave, crime-related child disappearance leave and child death leave when determining whether a contractual provision provides a greater right or benefit than the provisions of the ESA 2000 as they relate to these six leaves. As with the leaves described above, if an employee who takes what is purported to be leave under the contract has no actual entitlement to return to work, the leave under the contract will not be considered to be a greater right or benefit. This is because it is inherent in the concept of a leave that there is an entitlement to return; a supposed leave without such an entitlement is meaningless.
Where an employee is provided a greater benefit for notice of termination, termination pay or severance pay under an employment contract or collective agreement that directly relate to the employment standard, such greater benefit prevails over the minimum requirements in the ESA 2000.
For example, if an employee’s contract of employment provides the employee with two weeks of severance pay per year of employment rather than the minimum set out in the ESA 2000, the employee will be entitled to the higher amount under the contract of employment. However, where an employee’s contract grants the employee a lump sum of $5,000 as severance pay and the employee’s entitlement under the ESA 2000 is $7,500, the contract of employment will be considered to be void in this regard and the employment standard will prevail. Therefore, the employee would be entitled to severance pay in the amount of $7,500 despite the contract of employment.
In some cases, when terminating an employee, an employer will provide salary continuance for an extended period in order to bridge and/or maximize pension entitlements for the departing employee. Such arrangements may not refer explicitly to a termination date and in some cases, the employee is not expected (or even allowed) to attend at the workplace for the period that they are in receipt of the salary continuance payments. As a result, the Program may view the salary continuance as pay in lieu of notice rather than working notice.
In either case, such payments may exceed the statutory entitlement to notice or pay in lieu and would be a greater right or benefit. Where the employee is also entitled to severance under the ESA 2000, the employer may likewise claim that the salary continuance is a greater right or benefit with respect to severance pay, that is, where the total amount paid under the salary continuance arrangement exceeds both the notice or pay in lieu and severance obligations under the ESA 2000.
However, for this to be the case, the parties must have clearly turned their minds to the termination and severance obligations in the ESA 2000 in forging the deal. Even if the package is more generous than the combined entitlements under the ESA 2000, the package must reference severance pay explicitly or it will not be held to satisfy both notice and severance obligations. See McPherson v Xebec Imaging Services Inc. (January 25, 1996), ESC 96-17 (Randall). Note that although these arrangements may not comply with the requirements under ESA Part V, s. 11(5) with respect to the timing of the payment of termination pay in lieu of notice or severance pay, they may be considered to be a greater right or benefit in respect of those entitlements despite this technical breach.
In McDonnell Douglas Canada Ltd. v Topham (April 22, 1993), ES 93-74 (Randall) the employer argued that a provision in a collective agreement prohibiting termination except for just cause was a greater right or benefit than an individual employee’s right to notice of termination under s. 57 of the former Employment Standards Act and, therefore, that the employee was not entitled to notice of termination since the greater right or benefit prevailed over the employment standard. In that case, the employee was terminated for innocent absenteeism and an arbitrator had ruled that this was just cause for termination. The referee agreed with the employer, stating that the just cause provision afforded the employee greater job security than the notice provisions in the Act. This decision is contrary to Program policy.
It is the Program’s position that to compare a just cause clause with the statutory provision providing for notice of termination is to compare apples and oranges. While both a just cause clause and the statutory notice requirement relate to the termination of employment, they are different things. The focus of the just cause clause is job security. The statutory notice requirement has nothing to do with protecting an employee’s job. Its purpose is to provide an employee whose employment is being terminated with a reasonable period of time (or pay in lieu) to seek other employment without undue financial hardship. A just cause provision provides a valuable right to job security, but it does not give an employee any right to notice of termination or pay in lieu. The just cause clause and the notice requirements address two different concerns. It is therefore the Program’s view that the only thing that can be a greater right or benefit than notice of termination under ESA XV, ss. 57 or 58 is notice that is of greater length than that required under the ESA 2000.
The Divisional Court considered the issue of greater right or benefit in the termination notice context in the 1984 decision in Fanaken v Bell, Temple, 1984 CanLII 1856 (ON SCDC). The employee in that case was entitled under the former Employment Standards Act to four weeks' written notice of termination, but did not receive it. Rather, he was provided with six weeks' oral notice, key assistance in securing another job, together with the freedom not to report to work during the notice period. The court found that situation to be a greater right or benefit than the entitlement to four weeks' written notice. It must be emphasized that the oral notice was not just a casual reference to a likelihood of termination in the future but rather was found to be clear and unequivocal
notice of a specified termination date. The Fanaken v. Bell, Temple decision does not stand for the proposition that oral notice of equal length to the required written notice under the ESA 2000 is either sufficient notice or a greater right.
Referees have often denied an employer's claim that a greater benefit has been granted. In St. Peter's Hospital o/a St. Peter's Centre v Kee (November 20, 1980), ESC 917 (Egan), the referee held that a six-month pregnancy leave (when the employment standard was 17 weeks) was not to be a greater benefit, because the employer also required one month's notice and three months' compulsory absence prior to the date of delivery. In Michaud v Employee (November 23, 1973), ESC 165 (Bolan), the referee held that a higher rate of pay than the standard in the area and no overtime pay was not a greater benefit. In Oxford Warehousing Limited v Morin et al (October 17, 1980), ESC 891 (Bigelow) the referee held that rehiring terminated employees so the conditions and pay were the same as if they never left and therefore not a greater benefit than termination pay. The cases cited in this paragraph are all decisions under the former Employment Standards Act.
Once the employer has given greater benefits to an employee, they cannot subsequently recover them. In Fleet Facts (Canada) Ltd. v Woods (October 16, 1973), ESC 179 (McNish), a decision under the former Employment Standards Act, the referee held that an employer cannot give two weeks' termination pay and then, because the employee was entitled to only one week under the ESA 2000, try to deduct one week's pay from the vacation pay. Further, in David Kirsch Customs Limited v Fenney (March 22, 1983), ESC 1388 (Baum), the referee rejected the employer's argument that the amount of vacation pay paid to the employee in excess of the requirements of the former Employment Standards Act should be deducted from the pay in lieu of adequate notice of termination he had been ordered to pay to the employee. This was due to the fact that, among other things, the amount of vacation pay paid in excess of what was required by the former Employment Standards Act had been the subject of agreement between the employer and the employee. Since the Act indicated that a greater contractual or statutory right prevailed over a corresponding employment standard, the employer was obliged to pay it.
This provision was added to the ESA 2000 by the Fair Workplaces, Better Jobs Act, 2017, SO 2017, c 22 effective November 27, 2017. It expressly prohibits an employer from treating an employee as if that person were not an employee under the Act. For example, this provision prohibits an employer from misclassifying or treating an employee as an independent contractor, volunteer or any other type of non-employee, and therefore denying that employee some or all of their ESA entitlements.
In applying this provision, it must be determined if the individual is in fact an employee. See ESA Part I, s. 1 for a detailed discussion on the definition of employee. See also the discussion of employer-employee relationships and independent contractors in ESA Part I, s. 1.
Note that before the Fair Workplaces, Better Jobs Act, 2017 added this provision to the ESA, if an employer misclassified an employee for the purposes of the ESA, an officer could only issue an order with respect to specific standards that were contravened. However, with the introduction of this new provision, if an employment standards officer finds that an employer violated s. 5.1(1) as well as other ESA provisions in relation to that employee, the officer may issue a notice of contravention under ESA Part XXII, s. 113) for s. 5.1(1) and those violations as well. For example, if an employer misclassified an employee as an independent contractor and subsequently denied the individual overtime pay, the officer may issue a notice of contravention for the violation of s. 5.1(1) as well as an order to pay wages under ESA Part XXII, s. 103 for the unpaid overtime pay.
An employer does not contravene this provision simply by contravening another provision of the ESA (e.g., failing to pay vacation pay). However, if that other contravention stemmed from the employer’s misclassification of the employee as a non-employee, that would constitute a contravention of s. 5.1(1).
The key consideration in determining if an employer violated this provision is whether or not an individual is an employee as per the definition in ESA Part I, s. 1 and if an employer-employee relationship exists. It does not matter whether the misclassification and treatment of an employee as a non-employee arose from:
Note that an employee’s request or agreement to be classified as an independent contractor or any other type of non-employee would be considered contracting out under ESA Part III, s. 5(1). Any such agreement is null and void.
From November 27, 2017 to December 31, 2018, s. 5.1 included a so-called “reverse onus” provision; itplaced the burden of proof on the employer or alleged employer if, during the course of an investigation into a complaint, inspection or proceeding, the employer or alleged employer took the position that an individual is not an employee for the purposes of the ESA. The effect of that provision was to require the employer to establish, on a balance of probabilities, that the person was not an employee. Although the onus was on the employer to demonstrate that the worker was not an employee pursuant to that subsection, it was Program practice that employment standards officers would not rely solely on the employer’s failure to demonstrate this when making a determination, as officers make their determination based on the best available evidence. In the the investigatory context of the employment standards program, this meant, and continues to mean after the repeal of the “reverse onus” provision, that officers actively collect evidence from both parties and make the “employee status” determination on a balance of probabilities standard based on the best available evidence.
This provision was introduced by the Employment Standards Act, 2000. It codifies Program policy as it applied under the former Employment Standards Act. Section 6 confirms that a trade union can agree to a settlement on behalf of an employee that the trade union represents. For example, s. 6 could apply to allow a union to enter into a binding settlement regarding severance pay entitlements.
It is important to note that such settlement may be entered into only with respect to an entitlement that has crystallized or where its crystallization is imminent. As a consequence, this section could not, for example, be applied to bind employees to a contract provision that provided for future overtime hours to be paid at the employees' regular hourly rate. This would be considered to be an attempt to contract out of the Act and contrary to s. 5(1). However, where, for example, employees represented by a trade union had not been paid anything with respect to overtime hours contrary to the Act and the collective agreement, the union could enter into a settlement on behalf of the employees that required the employer to pay the employees at their regular rate (as opposed to the overtime rate) for those overtime hours.
This provision was introduced by the Employment Standards Act, 2000. Section 7 provides that, where the Act allows an employee to enter into an agreement with the employer (such as an agreement to work excess hours or to average overtime), an agent may make such an agreement. Where the agent makes such an agreement, it is binding on the employee. In Collins & Aikman Plastics Ltd. v. United Steelworkers, Local 9042 an arbitrator concluded that although the terms of the collective agreement allowed the employer to require an employee to work on a public holiday, those terms could not override the employee's individual statutory rights to choose not to work. This decision is inconsistent with the Program's interpretation of s. 7 of the Act and should not be followed.
The type of agreement that this section governs is limited to agreements made under the Act.
Where the Act requires that the agreement made or given by an employee be in writing, which is in most cases - see ESA Part I, s. 1(3) - the agreement made by the agent must also be in writing.
Section 8(1) provides that nothing in the Employment Standards Act, 2000, subject to s. 97, suspends or affects the right of the employee to sue their employer in court. In particular, the ESA 2000's limitation period provisions do not apply when an employee pursues their ESA 2000 rights by suing in court.
Section 97 states:
For a detailed discussion of when civil proceedings are not permitted, refer to ESA Part XXII, s. 97.
Section 8(2) requires a litigant to give notice to the Director when the litigant relies on the ESA 2000 to support a claim against their employer.
Section 8(2) ensures that the Director and therefore the Ministry will be alerted so that it may seek standing in a proceeding if it is of the view that important issues are being raised or the integrity of the legislation is being challenged. The obtaining of standing will allow an opportunity to present the Ministry's view of the legislation if the lawsuit involves a legislative interpretation or policy issue, and further will ensure that the Director is informed of legal developments affecting the ESA 2000.
Another purpose for this section is to enable an employment standards officer to determine whether the employee is prohibited from filing a claim with the Ministry on the basis of previously having commenced a civil action for the same matter.
The Director need not be notified of the proceeding at its onset, rather, they must be notified when all the parties' pleadings are complete and on or before the date the matter is set down for trial. See ss. 8(3) to (5) for information on the service of the notice. For copies of the approved form please contact the Employment Practices Branch.
Note that the ESA 2000 does not require a client of a temporary help agency to notify the Director if it commences a civil action against a temporary help agency for charging a prohibited fee in contravention of paragraph 8 or 9 of ESA Part XVIII.1, s. 74.8(1).
This provision must be read in conjunction with section 8(4) and 8(5), which establish when the service is deemed to be effected.
Section 8(2) requires that an employee give notice to the Director when they commence a civil proceeding against their employer under the ESA 2000. The notice must be served on a form approved by Director on or before the date the civil proceeding is set down for trial. Section 8(3) establishes the methods by which the notice may be served on the Director:
This would include, for example, personal delivery by the employee or their representative or agent, or delivery by a private courier.
Generally, the Director's office is closed between 5 p.m. and 8:30 a.m. Monday through Friday, on Saturdays, Sundays, the nine public holidays under the ESA 2000 as well as Easter Monday, the August Civic Holiday, and Remembrance Day. See the definition of public holiday in ESA Part I, s. 1 for a list of the public holidays.
It is Program policy that three Canada Post services fall within the meaning of verifiable mail: these are Registered Mail, Xpresspost and Priority Courier. However, it is important to note that Xpresspost and Priority Courier are verifiable only if the signature upon delivery
option is selected.
On the date of publication, the Director's office is located at the following address:
Ministry of Labour
Employment Practices Branch
400 University Avenue, 9th Floor
Toronto, ON M7A 1T7
At the time of writing, the Director's fax number is 416-326-7061. The Director's email address is Director.EmploymentStandards@ontario.ca.
This provision must be read in conjunction with s. 8(3) which sets out the methods by which a notice of a civil proceeding may be served on the Director. Section 8(4) establishes when the service of the notice of civil proceeding is deemed to have taken place.
If the notice was served by delivering it to the Director's office on a day and at a time when the office is open per s. 8(3)(a), service is deemed to have taken place on the day indicated on the receipt or acknowledgement provided by the Director or their representative.
If the notice was served by mailing it to the Director's office using a method of mail delivery that allows the delivery to be verified per s. 8(3)(b), service is deemed to be effective on the day shown in the verification.
If the notice was served by sending it to the Director's office either by email or fax per s. 8(3)(c), service is deemed to have taken place on the day the electronic transmission or fax transmission is sent, unless the transmission is sent on a day that the Director's office is closed or after 5:00 p.m. on any day. In those situations, s. 8(5) provides that the service is deemed to have been effected on the next day the office is open.
Generally, the Director's office is closed between 5 p.m. and 8:30 a.m. Monday through Friday, on Saturdays, Sundays, the nine public holidays under the ESA 2000 as well as Easter Monday, the August Civic Holiday, and Remembrance Day. See the definition of public holiday in ESA Part I, s. 1 for a list of the public holidays.
When an employee serves their notice of civil proceeding on the Director via email or by fax after 5:00 p.m. on a regular business day, or at any time on a day when the Director's office is closed, s. 8(5) deems the service to have occurred on the next day the Director's office is open.
Generally, the Director's office is closed between 5 p.m. and 8:30 a.m. Monday through Friday, on Saturdays, Sundays, the nine public holidays under the ESA 2000 as well as Easter Monday, the August Civic Holiday, and Remembrance Day. See the definition of public holiday in ESA Part I, s. 1 for a list of the public holidays.
The continuity of employment provisions in Part IV provide that where there is a sale of a business and an employee of the seller is hired by the purchaser, or where there has been a change of contractors for building services and an employee of the replaced provider is hired by the new provider, the employee’s length or period of employment with their previous employer is treated as if it had been employment with the new employer with respect to rights under the Employment Standards Act, 2000 that are determined by length or period of employment, i.e., vacation, pregnancy and parental leave, domestic or sexual violence leave, critical illness leave, crime-related child disappearance leave, child death leave, notice of termination or pay in lieu, severance pay, organ donor leave and reservist leave.
Section 9(1) provides for continuity of employment for an employee when there is a sale of a business if the purchaser employs an employee of the seller, subject to the s. 9(2) rules regarding a gap between employment with the purchaser and the earlier of: (1) the last day of employment with the seller and (2) the date of the sale. In that case, the employee is deemed not to have had their employment terminated or severed for the purposes of the ESA 2000 and employment with the seller is included in any subsequent calculation of length or period of employment with the purchaser for entitlements to:
Under the former Employment Standards Act, it was the Program’s position that the effect of s. 13 was to transfer the liability for employees' vacation pay accrued but not yet due at the time of the sale to a purchaser. This position was consistent with several referee decisions which found that, based on the language of s. 13 and based on the clear link between vacation time and vacation pay, a purchaser was liable for accrued vacation pay. Although the language in s. 9(1) is different from the wording in the former provision, the Program’s position is that the policy intent remains the same. The Program is of the view that had the Legislature intended to change the rules regarding vacation pay in the context of the sale of a business, it would have dealt with vacation pay explicitly - for example, under s. 76(1) a building service provider is required to pay accrued vacation pay upon ceasing to provide services at a premises and ceasing to employ an employee, there is no similar provision in s. 9.
The Program’s policy is that both the employee’s length of service and the vacation pay liability flow through the sale to the purchaser. However, the vacation pay liability only flows through the sale with respect to the accrued vacation pay that did not become due until after the sale. In other words, the seller is liable only for the vacation pay that was both accrued and due to the employee prior to the sale.
An exception to the flow-through rule occurs if the purchaser hires an employee of the seller more than 13 weeks after the earlier of the last day of the employee’s employment with the seller and the date of the sale. In this situation, there is no continuity of employment under s. 9 and, therefore, the seller is liable for all vacation pay accrued by the employee to their last day of employment with the seller. In addition, the purchaser is not required to recognize the employee’s length of service with the seller for the purposes of determining the employee’s entitlements to vacation time under Part XI.
Section 9 does not require a purchaser to hire employees of the seller. As a result, the purchaser has no obligation to hire an employee of the seller who is on a statutory leave at the time of the sale. See Gonzalez v IBM Canada Limited, 2014 CanLII 14188 (ON LRB). Where the purchaser does hire the employee, it is the Program’s position that the offer of employment may be made on whatever terms and conditions the purchaser chooses and so there is no statutory right to the balance of the leave
commenced when the employee was employed by the seller, nor is there any obligation with respect to reinstating
the employee to the same or a comparable job to the one held with the seller. For more information on Part XIV leaves of absence and reinstatement, see ESA Part XIV.
Where an employee’s employment is terminated and severed prior to the sale and for reasons unrelated to the sale, the question may arise as to whether s. 9 would apply.
Because the purpose of s. 9 is to undo
a common law termination that would otherwise be triggered by the sale, it is the position of the Program that s. 9(1) does not apply where the termination or severance is not related in any way to the sale. For example, if an employee’s employment was terminated by the seller for wilful misconduct and the employee was hired by the purchaser, s. 9(1) would not apply.
It is the Program’s position that there is no continuity of employment under s. 9 where there is an inter-jurisdictional sale, e.g., where there is a sale of a business from an employer that falls under provincial jurisdiction to an employer that falls under federal jurisdiction and vice versa. For additional information see the discussion at Part III, s. 3 on the sale of a business across jurisdictions.
For information on the Program’s policy related to public holiday pay and a sale of business, refer to Part X, s. 24.
Section 9(1) applies to a sale
of all or part of a business
. These terms are broadly defined in s. 9(3) and s. 1(1) respectively as follows:
Section 9(1) applies to provide continuity of employment if:
It is sometimes difficult to determine whether a transaction involves a sale of a business or just a sale of assets. In a sale of assets, an employer sells items of property that it used in its business, but it does not transfer the actual business to the purchaser, even though it may discontinue its business following the sale. A sale of a business is sometimes described as a sale of a going concern
or a functional economic vehicle
, but these are imprecise terms which may not provide much help in distinguishing a sale of a business from a sale of assets in practice.
The Ontario Court of Appeal in Abbott v Bombardier Inc., 2007 ONCA 233 (CanLII) considered the application of the going concern test and rejected its use on the basis that it did not accord with the purpose of section 9. The case involved a contracting out of information technology services where there was a significant transfer of assets and the purchaser agreed to make an offer of employment to each of the employees who performed the transferred functions and to recognize the past service of each employee who accepted the offer as if it had been employment with the purchaser. The Court found that the transaction constituted a sale of a part of a business under section 9 on the basis that the outsourced function was an activity
for purposes of the definition of business
in s. 1(1).
The Court held that a sale of a business arises . . . where there was the transfer of a specific bundle of tasks and functions performed by an identifiable group of employees.
While this appears to suggest that a mere contracting out transaction or outsourcing of a specific function may constitute a sale of a business, the decision must be considered in the particular context of the case. First, there was another indicator of a sale of a business, a transfer of significant assets - a substantial amount of computer equipment. Secondly, there was an obligation on the part of the purchaser to make offers of employment to the affected employees. Third, the employees were in fact transferred to the purchaser in accordance with the terms and conditions respecting their future employment with the purchaser as provided for in the agreement governing the transaction.
However, the presence of any of the following indicators generally points to a sale of a business:
goodwillto the purchaser.
While the existence of any of the above-mentioned factors points to a sale of a business, the absence of any of them does not mean that there was only a sale of assets. Further, the fact that the seller or purchaser calls the transaction a sale of assets does not make it one if, in actual fact, a sale of a business has occurred. Often, a seller and a purchaser will call the transaction a sale of assets for tax purposes when, in fact, it is a sale of a business for purposes of s. 9.
The issue as to whether a particular sales transaction involved the sale of a business or a part of a business (in either case, s. 9 would apply) or a sale of assets that may or may not be used in the operation of another employer’s business (in which case s. 9 would not apply) has been the focus of many hearings under the former Employment Standards Act.
Referee Gorsky in McLaughlin Chevrolet-Oldsmobile Ltd. v Coombs (May 9, 1980), ESC 780 (Gorsky)cited the following test of what constitutes a sale of a business:
The above is an excerpt from Kenmin v Frizzell et al, [1968] 1 All ER 414 (Eng QB) which appeared in an Ontario Labour Relations Board decision, Canadian Union of Public Employees v Metropolitan Parking Inc., 1979 CanLII 815 (ON LRB), from which Referee Gorsky cited at length.
In Mobile Mix Concrete Products (1971) Ltd. v McClain (October 29, 1974), ESC 206 (McNish), Referee McNish concluded that a sale of a business had occurred in light of the fact that the agreement of sale contained covenants by the vendor not to compete with the purchaser after the sale, and to give up the use of its corporate name and to deliver to the purchaser customer lists, salesmen’s reports and production records.
Similarly, in 477286 Ontario Food c.o.b. as Vitto Brand Foods v Gilbank (September 18, 1981), ESC 1068 (Davis), Referee Davis ruled the transaction to be a transfer of a going concern and not a mere sale of discrete items of property because the purchaser used the vendor’s trade name and packaging materials.
As previously noted, the lack of certain indicia of a sale of a business will not in itself take a transaction out of s. 9 where other indicia of such a sale are present. In Ontario Film Laboratories Ltd. v Pharand et al (July 8, 1980), ESC 814 (Aggarwal) the purchaser operated the same type of business as the vendor in the same premises with the same employees and with some of the vendor’s assets. Referee Aggarwal concluded that s. 13(2), which corresponds to s. 9(1) in the ESA 2000, applied, notwithstanding the fact that the purchaser did not adopt the vendor’s trade name.
In McLaughlin Chevrolet-Oldsmobile Ltd. v Coombs, the vendor’s failure to assign outstanding contracts and to deliver up customer lists did not preclude a finding that a sale of a business had taken place where the purchaser had taken over the vendor’s premises, employees, equipment and automobile dealer’s franchise.
In Cambridge Stampings Inc. v Harth and Barradell (November 6, 1980), ESC 909 (Egan) Referee Egan held that the mere fact that the purchase made some post-sale alterations to both the machinery and the product of the vendor’s metal stamping business did not prevent the application of s. 13(2) in the former Employment Standards Act, which corresponds to s. 9(1) in the ESA 2000.
In Nathan Hennick & Co. Ltd. v Masci (September 25, 1978), ESC 550 (Davis), where a purchased factory ceased operations for a three-week period following its acquisition, Referee Davis nevertheless determined that a sale of a business had occurred, since the evidence showed that there had been no severance of customer relations after the transaction and since the vendor’s past practice had been to close the plant for a similar period for annual vacation purposes.
In Cambridge Stampings Inc. v Harth and Barradell, Referee Egan found that that while the fact that an agreement of purchase and sale which specifically provides for a transfer of goodwill is often cited as evidence that a business has been sold, . . . the absence of goodwill is not conclusive of the contrary.
In 446816 Ontario Inc. c.o.b. Centreside Dairy v Popplewell (September 23, 1982), ESC 1286 (Fraser), Referee Fraser found that a lack of an express assignment of goodwill does not prevent a determination that there was a de facto transfer. In that case, the vendor had given a 10-year non-competition covenant and the purchaser had assumed all of the vendor’s regular customers.
In Revin v Lamantia Garcia Products Ltd., 2008 CanLII 790 (ON LRB), the Board concluded that there had been a sale of a business even though there was no goodwill or even purchaser loyalty that could be transferred. In that case, the vendor assigned the lease of its stall at the Ontario Food Terminal and sold about $80,000 worth of fruit and vegetable inventory in it to the purchaser. The Board cited Abbott v Bombardier Inc. in taking the position that a sale of a business for the purposes of s. 9 of the ESA 2000 did not require the transfer of a going concern. Rather, the Board found that the purchaser had bought a very valuable business asset in the form of the lease of the stall and had purchased all of the vendor’s fruit and vegetable inventory pursuant to the Bulk Sales Act. It had effectively purchased all that could be purchased of the vendor’s business and then expanded its own business into an area previously carried on by the vendor. As such, it amounted to a sale of a business for the purposes of s. 9.
A purchaser who acquires assets such as premises and equipment from a vendor and who employs the vendor’s employees does not remove itself from the ambit of s. 9(1) merely because it makes changes in the nature of the business formerly carried on by the vendor; if the purchaser continues on with a part of the vendor’s undertaking, s. 9(1) will apply. For example, in Centreside Dairy v Popplewell, the vendor had operated a dairy primarily to process and to distribute milk, but had also manufactured and distributed ice cream. The purchaser of the dairy ceased milk processing altogether to devote the purchased facilities exclusively to the manufacture of ice cream, but it did arrange for the distribution by its delivery men of milk processed by another dairy. The referee held that because the sales operation of the business (as opposed to its production operation) continued unchanged after the purchase, the transaction could be characterized as the acquisition of a part
of an activity, trade or undertaking, which fell within the definition of business – note that definition is similar to the one now contained in ESA Part I, s. 1(1).
Somewhat similar in effect is Lakehead Rent-Alls Limited v Estate of Karl Kuzik (October 17, 1981), ESC 1048 (Davis), where the purchaser and vendor had both carried on the business of renting and selling equipment from the same premises with the same employees. Referee Davis held that s. 13, which corresponds to s. 9 in the ESA 2000, was applicable despite the fact that the purchaser’s marketing strategy was to concentrate on consumer rentals whereas the vendor had emphasized industrial sales.
In law, a corporation is regarded as having a separate existence from the person or persons who own it. Note that ownership of a business corporation is represented by shares. A person who owns more than 50 per cent of the shares is said to have a controlling interest in the corporation.
Therefore, where employees are employed by a corporation and the shares of the corporation change hands, the corporation and hence, the employer, is regarded as being unchanged, notwithstanding that the corporation now has new owners. In other words, the sale of a company’s shares will not in itself give rise to a new employment relationship, given that the company, as a legal entity, is not changed by the transfer of its share capital to a new owner. Accordingly, s. 9 has no application to a sale of shares in a corporation. It is not necessary to give the protection of s. 9 in such a case because the accrued length or period of employment of the corporation’s employees remains unaffected by a change in the corporation’s owners.
Where an employee is employed by Corporation A, the shares of which are subsequently purchased by Corporation B, the employee who moves from A to B is considered to continue to be employed by the same employer, and their accrued length or period of employment with A is recognized without the application of s. 9.
An exception to this principle would occur, however, if the purchaser subsequently moved to wind up the seller corporation, or amalgamate it with another, with the result that the employees of the seller are now employed by another entity. In such cases, a sale transaction would likely be found to have occurred, either at the time of the transfer from the seller or subsequent winding up or amalgamation. In that case, s. 9 would apply. Each case however must be assessed on its own facts.
Where a receiver, acting on the instructions of a secured creditor of a debtor employer, is appointed to assume control of the employer’s business, the end result will be either that the business is wound up or that it is sold as a going concern to a purchaser.
If the receiver opts for a wind-up, it may liquidate the assets of the business immediately following its appointment. Sometimes, however, the business will be wound up gradually, so as to maximize recovery for the secured creditor. Typically, loan agreements signed by debtors authorize the secured lender to appoint a receiver if default occurs. Such agreements usually provide that if a receiver is appointed, the receiver will be considered as agent for the debtor in carrying out the wind-up.
Secured creditors can also apply to the court for an order appointing a receiver. In such cases the receiver is acting as an officer of the Court. Any proceeds collected by a court appointed receiver are distributed through court orders.
Obviously, the appointment of a receiver raises many potential issues concerning the application of s. 9. If the debtor employer’s employees continue working for the receiver for a time following its assumption of control over the business, the question might arise whether s. 9(1) applies so as to result in continuity of employment following the receiver’s appointment. And if the receiver, instead of liquidating the business, sells it as a going concern, and the purchaser retains the employees of the business, the issue of whether the purchaser inherits the employees' accrued seniority would come into play.
Referees have consistently held that the involuntary nature of a disposition does not prevent it from being characterized as a sale within the meaning of s. 13(2), which corresponds to s. 9(1) in the ESA 2000. In Hotel Esquire (St. Catharines) Ltd. v Hands et al (May 31, 1982), ESC 1233 (Roberts) the referee held that the business of mortgagor assumed by mortgagee upon foreclosure. In Nathan Hennick & Co. Ltd. v Masciand Hentschell Clocks Canada (1977) Ltd. v Clarke (April 23, 1981), ESC 987 (Howe), the referees found that the sale of a business as a going concern by receiver. Accordingly, the fact that a business changed hands
as a result of the appointment of a receiver does not preclude the application of s. 9(1). However, the appointment of a receiver will not generally constitute a sale
such that that a receiver will be considered a purchaser
for the purposes of s. 9 - see Armstrong et al v Coopers & Lybrand Ltd. et al, 1986 CanLII 2621 (ON SC). Rather, where the receiver sells the business, it is the purchaser of the business who may be subject to the continuity of employment provisions. As noted inBrandwood v Renfrew Inn Holdings Ltd. (November 15, 1994), ESC 94-212 (Genge), the receiver in such a case is acting as a conduit between the insolvent business and the purchaser. Employees who resign their employment between the time when the receiver is appointed and when the final sale to a purchaser is completed will not be entitled to termination and severance pay – see Brandwood v Renfrew Inn Holdings Ltd..
It follows from the foregoing that:
Where the employer becomes bankrupt, a trustee is appointed under the Bankruptcy and Insolvency Act. If the trustee then sells all or part of the business to a purchaser, who employs employees of the bankrupt employer, s. 9 will apply, subject to the rules concerning a hiatus or gap in s. 9(2). Employees will not be considered to be automatically terminated by the appointment of the trustee if the trustee sells all or part of the business. Furthermore, the purchaser, upon subsequently terminating any of the employees, will have to recognize their length or period employment with the purchaser, plus that with the bankrupt company which includes employment for the period the company’s estate was under the trustee’s administration.
See for example:
Example
The employee would not be entitled to termination and severance pay until their termination by B Co. At that time, the employee’s length of service for purposes of termination and severance pay would be eight years.
In a situation such as the above, but with the difference that there is no sale of the business and the employee is terminated/severed (including a deemed termination/severance resulting from a lay-off), the employee is entitled to termination and severance pay based upon their length of employment with the bankrupt employer (which includes employment with the trustee in bankruptcy). The claim is against the estate of the company, and is made by filing a proof of claim.
Where the trustee does not sell the business, a proof of claim for the vacation pay relating to the employee’s employment with the insolvent employer (both accrued and due) would be filed with the trustee if an employee in such a situation worked for the trustee, any vacation pay relating to the period of employment with the trustee would be paid out of the bankrupt company’s estate. Note that these expenses are not, in general, a personal liability of the trustee.
Where the trustee sells the business and s. 9 provides continuity of employment, an employer that purchases a bankrupt business from a trustee will be liable for the vacation pay that accrued while the employee was working for the bankrupt employer provided that the vacation pay has not already have become due under the bankrupt employer. Therefore, the officer may issue an order to pay against the purchaser of the business for vacation pay that accrued during employment with the bankrupt company (including employment with the trustee) but did not become due until sometime after the employee had commenced employment with the purchaser.
Example
In the above-noted example, a proof of claim could be filed with the trustee for $2,400 in vacation pay that had accrued in the period June 30, 2000, to June 30, 2001, and was due April 30, 2002 (i.e., due prior to the appointment of the trustee). On April 30, 2003, the officer could issue an order to pay to B. Co. for the $2400 in vacation pay that accrued while the employee was employed by A. Co. from June 30, 2001, to June 30, 2002, but which came due after the employee commenced employment with B. Co. (The purchaser of the business would also be liable for vacation pay accrued between the date the trustee was appointed (June 30, 2002) and the date of the sale December 31, 2002) but only when that vacation pay came due.
In support of Program policy in this regard, see Sis Cronin, a division of Urus Industrial Corporation v Hurdis (March 21, 1994), ESC 94-69 (Randall).
Occasionally, a secured creditor will exercise whatever rights they have to foreclose on a debtor employer’s business. This typically means that the secured creditor takes the business in satisfaction of the debt rather than hiring a receiver to sell the business. Where this occurs, and the creditor continues to operate the business and retains the debtor’s employees, s. 9(1) applies – see Hotel Esquire (St. Catharines) Ltd. v Hands et al. In this case, the secured creditor’s position is, for the purposes of s. 9(1), tantamount to that of a purchaser of the business.
When a landlord exercises a right of distraint on the assets of a tenant/employer to recover arrears of rent, it generally does so by securing control of the equipment, inventory and other assets located in the leased premises. This is done with a view to selling the assets to recover arrears of rent. In such cases, s. 9 will typically have no application. However, if the landlord enters the premises and carries on the operation of the business and retains its previous tenant’s employees, it may be considered to be a purchaser of the business as per the discussion on secured creditors above.
Generally speaking, s. 9(1) will not apply in the franchise or concession type of situation. Such situations by and large do not involve a transfer of a business directly between the old franchisee and the new franchisee, but rather involve two separate transactions in which the franchise rights held by the old franchisee first revert to the franchisor and then are reconveyed by the franchisor to a new franchisee. There may, in a sense, be a transfer of a business from the original franchisee to the franchisor, followed by a second transfer of a business from the franchisor to the new franchisee, but s. 9(1) cannot apply to these transfers individually unless they are accompanied by a parallel movement of employees. Since the franchisor himself does not usually enter into an employment relationship with the original franchisee’s employees in the course of the transactions, there is no basis on which s. 9(1) can be applied, even though those employees may ultimately end up working for the new franchisee.
While the treatment of franchises and concessions in labour law is a rather complicated and difficult matter, the following rule should be of assistance in dealing with these kinds of transactions:
Where employer X has a franchise or some other key contract from franchisor Y, and it gives it up or loses it and a third party Z then acquires the franchise or other key contract and hires X's employees, s. 9(1) will not apply, unless:
A typical example of a franchise operation is a service station; the station operator (X) acquires from an oil company (Y) the right to sell its product and to display its name. The oil companies usually will not permit station operators to sell the franchise; instead, the operator will have to give it up, and the oil company itself will sell the franchise to a new franchisee (Z). Generally, the oil company will not enter into an employment relationship with X's employees, and while usually there would be no need for them to do so (since Z will probably take over from X with virtually no interruption in the activity of the service station), the fact that the oil company does not hire X's employees means that there is no basis on which s. 9(1) can be applied.
The opinion of most referees has been that where there is no direct assignment of the contract (franchise) from the original contractor (old franchisee) to the third party (new franchisee), there is no sale of a business to which s. 9(1) can apply, and hence, there is no continuity of employment.
In Burbank Automotive Ltd. v Wilson (March 21, 1978), ESC 493 (Davis), X had carried on business as a service station operator, but retired, terminating both his lease of the station premises from Shell Oil and his product supply and exclusive marketing contracts, also with Shell. Immediately upon termination, Shell gave a new lease to Z and entered into similar supply and marketing agreements with Z, who employed all of X's former employees. The only transaction directly between X and Z was the sale of a truck and some stock in trade. Referee Davis held that this small isolated transaction could not be viewed as a sale of a business between X and Z, and went on to conclude that the business must be seen as having first been transferred from X to Shell and then from Shell to Z. Shell was the owner of the business for a notional instant in time, and the transfer of the business from X to Shell (not having been accompanied by a corresponding transfer of employees to Shell) effected a termination, even if there was, practically speaking, no interruption in employment.
Results similar to those in Burbank Automotive Ltd. v Wilson were obtained in Phil Coutu Limited v Talbot (September 30, 1982), ESC 1294 (Davis) and Cecil B. Carter o/a Shell Service Centre v Walker (February 28, 1981) ESC 957 (Saltman). The only ruling by a referee in which s. 13(2), which corresponds to s. 9(1) in the ESA 2000, was held to be applicable in these circumstances was Joe Hinschberger c.o.b. Joe’s Gulf v Spicer (March 4, 1982), ESC 1161 (Hunter), which, for a number of reasons, is not considered by the Branch to be convincing counter-authority to the Burbank Automotive decision.
In conclusion, it is difficult to see how, in its present wording, s. 9(1) can be interpreted to apply to a supposed sale which is actually a two-stage transfer (from X to Y to Z), and in which Y does not employ X's employees, even though they are employed by Z. Accordingly, the current policy of the Program in such cases is that there is no continuity of employment, and when X discontinues its operation of the business, a termination of employment occurs. Note, however, that s. 9(1) will apply where Y does hire X's employees, or where X assigns the key contract directly to Z.
In addition to the requirement that there be a sale of a business in order for s. 9(1) to operate, there must also be a purchaser who employs an employee of the seller. Subsection 9(1) does not have the effect of obligating the purchaser of a business to hire the seller’s employees. If the purchaser does not hire the employees, s. 9(1) has no application.
It should also be noted that if the purchaser opts to hire the seller’s employees, s. 9(1) does not require that the purchaser hire the employees on the same terms and conditions of employment as the seller had offered. Subsection 9(1) would apply to provide the employees with continuity of employment even though the purchaser hired the seller’s employees at a wage rate lower than that which they had been earning in the seller’s employ.
There are several referee and adjudicator decisions which state that s. 13 of the former Employment Standards Act (now s. 9) does not apply where the purchaser employs the employees on terms that are radically different
from those which the employees had with the vendor, e.g., Berdan et al v Dunlop Construction Products Inc. (June 18, 1993) ES 93-117 (Muir). However, these are contrary to Program policy and should not be followed on this particular point.
Program policy is that if the purchaser does employ the employees of the seller, it cannot avoid the application of s. 9(1) by relying on any of the following:
The provision of continuity of employment for certain purposes of the ESA 2000, and the purchaser’s obligation to honour it, is an employment standard which cannot be contracted out of or waived by either the employee or employer or their representatives.
As previously mentioned, the fact that an employee is employed by the purchaser in a different position than they held with the vendor does not prevent s. 9(1) from operating. In T.A.S. Investments Limited v Kleinert (April 20, 1978), ESC 508 (Springate), continuity was held to flow through regardless of the fact that the employee was employed by the vendor as a store manager but was only employed by the purchaser to maintain the store’s financial and payroll records. Likewise, if the purchaser employed the employee on a term or task
basis, there will still be continuity of employment under s. 9(1). Note that there is one adjudicator’s decision to the contrary on that point – see Penrose et al v Maher Inc. in Bankruptcy c/o Ernst & Young Inc. (August 24, 1994), ESC 94-155 (Wacyk).
On the other hand, there is nothing that obliges the employee to accept employment with the purchaser, even if that employment is exactly the same position with identical terms and conditions of employment. The employee always has the option of rejecting the purchaser’s offer of employment, and treating the vendor’s sale of the business as a termination and severance of employment.
Referee Davis in Galante c.o.b. as Fredy’s Barber Shop v Shaw (January 13, 1982) ESC 1125 (Davis) upheld this option, although with no express reference to s. 13(2) of the former Employment Standards Act,which corresponds to s. 9 in the ESA 2000. In that case, the owner of a business had decided to sell it but did not inform his employees of the impending sale. He planned to announce it to them at the closing, at which time he was going to give them termination pay. As he was about to make the announcement, one of the employees, who had heard that there was to be a sale and felt that the purchaser of the business would be unlikely to hire him, lamented that there would be no work for him and announced that he was leaving
. The employer argued that he was not liable for termination pay because the employee had quit, but the referee held that the employee lacked this intention and had left because he had concluded that his employment was being terminated by the sale. The employer’s contention that he should not be ordered to pay termination pay, because the employee’s abrupt departure had precluded him from putting forward employment alternatives (such as employment by the purchaser or by the vendor at a different location) for the employee’s consideration, was rejected on the grounds that these alternatives represented not a continuation of the existing employment relationship, but the formation of a new employment relationship.
In order for there to have been employment by the purchaser
, it is not necessary for the purchaser of a business to make an express statement offering employment to the seller’s employees. It is enough that the purchaser knowingly allows the employees to continue working in the business following the sale. However, this rule should not be applied too narrowly. Where, for example, a sale of a business occurs during an employee’s shift, the purchaser will not be considered to have employed the employee for the purposes of s. 9(1) merely because the employee works through to the end of his shift, if the business is such that termination at the precise moment of the sale would be impractical and if the employee never enters into any agreement with the purchaser and performs no further work for them. See the decision of Agincourt Motor Hotel Limited v Flannigan et al (August 19, 1982), ESC 1272 (Davis).
In Ontario (Employment Standards Officer) v Equitable Management Ltd. (Div Ct), 1990 CanLII 6973 (ON SC) the Divisional Court held that s. 13(2) of the former Employment Standards Act, which corresponds to s. 9 in the ESA 2000,applied even if the seller gave notice of termination. This decision accords with the intent of the continuity provisions, which is to ensure that credit for an employees' past employment with the seller is not lost when they are hired by the purchaser, subject to the rules regarding a gap between employment with the seller and employment with the purchaser in s. 9(2). It is Program policy that the employee also retains credit of their past employment with the seller where the seller, instead of giving notice of termination, gives pay in lieu of notice.
In the case of a sale of a business where an employee terminated by the seller is not hired by the purchaser within the 13-week period set out in s. 9(2), the seller must comply with Part XV, that is, must provide proper notice of termination or pay in lieu thereof, and severance pay, where applicable.
It is important to note that s. 9:
The purchaser is not obligated to hire the seller’s employees whether they are currently working, on lay-off, sick leave, a leave of absence or workers' compensation.
The employee is under no obligation under the ESA 2000 to accept employment with the purchaser and their refusal does not disentitle them to termination notice, or pay in lieu or severance pay. This is so even if the purchaser is offering the same terms of employment or reasonable alternative employment.
It sometimes happens that the sale contract between the seller and the purchaser will contain a provision obligating the purchaser to offer employment to some or all of the seller’s employees. However, if the seller, relying on the contract, does not provide notice of termination to its employees but the purchaser does not end up making an offer after all, it is the seller who is responsible for the termination pay and severance pay, since it is the one who terminated and severed its employees' employment. There is no basis in the ESA 2000 for holding the purchaser liable, despite what was in the sale contract, although the seller may be able to sue the purchaser civilly.
Where a purchaser does employ the seller’s employees following a sale in accordance with s. 9 but later terminates their employment, there is no pro rata division of liability for termination pay between the seller and purchaser. The subsequent responsibility for complying with Part XV requirements based on length of employment with both the seller and the purchaser lies solely with the purchaser.
Further, the purchaser is not entitled to any credit for termination pay or notice of termination that was previously paid or provided by the seller at the time of the sale. However, if the seller had paid severance pay at the time the employees lost their employment with it, that amount may be offset against the purchaser’s subsequent liability as a contractual payment based on length of employment or seniority per paragraph 3 of s. 65(8).
While in many sale situations, the employee’s first day of employment with the purchaser will follow immediately after their last day of employment with the seller, there will also be situations where there are short interruptions in employment. Section 9(2) provides, in effect, that s. 9(1) will apply only if no more than 13 weeks separates the first day of employment with the purchaser and the earlier of:
The term last day of employment with the seller
simply means the last day on which the employee is employed by the seller for purposes of the ESA 2000. Bearing in mind that both active and inactive employment counts as employment for purposes of ESA Part XV, s. 59(1) and ESA Part XV, s. 65(2), this includes time spent on lay-off up to the point at which a termination or severance is triggered. Note that for purposes of s. 9(2), the first day of the lay-off is not considered the last day of employment with the seller. While some might argue that it should be so considered because of s. 56(5), which deems the first day of a lay-off that ends in termination to be the day on which the employee’s employment is terminated, this argument ignores the fact that s. 9(2) refers to the last day of employment, not the day on which the employee’s employment was deemed terminated; it also ignores the fact that s. 9(2) applies for all rights under the ESA 2000 that depend on how long an employee has been employed and not just for purposes of notice of termination or termination pay in lieu.
If an employee on lay-off is potentially entitled to both termination pay and severance pay, their last day of employment will be considered, for purposes of s. 9(2), to be the later of: (1) the day on which a termination is triggered, and (2) the day on which a severance is triggered. For example, if an employee who is potentially entitled to both termination pay and severance pay is put on lay-off and benefits are not maintained and none of the other conditions described in ESA Part XV, ss. 56(2)(b) or (c) are met, their employment is considered terminated once more than 13 weeks have passed, and severed once 35 weeks had passed. For purposes of s. 9(2), therefore, their last day of employment is considered to be the final day of the 35th week; if the purchaser hired the employee within 13 weeks of the earlier of that day and the day of the sale, there would be continuity insofar as any subsequent calculation of length of employment or period of employment was concerned.
If the employee did not have a potential entitlement to severance pay, for example, because they would not have accumulated five years of employment with the employer in total as of the end of 35 weeks of lay-off, or because their employer did not have a payroll of at least $2.5 million, the last day of employment would be considered to be the final day of the 13th week of lay-off; if the purchaser hired the employee within 13 weeks of the earlier of that day and the day of the sale, there would be continuity insofar as any subsequent calculation of length of employment or period of employment was concerned.
It should also be noted that the deemed termination date as set out in ESA Part XV, s. 56(5) has no application with respect to any subsequent liability a purchaser may have for notice or termination pay where there is continuity of employment under s. 9, because under s. 9(1), the employment would be deemed not to have been terminated at the time of the sale, even if the employee was not hired by the purchaser until after the lay-off had exceeded the period of a temporary lay-off.
This is an inclusive definition, giving sale a broader meaning than it has in normal usage. For example, a sale would not normally include a transfer of a business by way of a gift or inheritance. However, since this section defines a sale to include transfers or any other manner of disposition
, such a transfer would be considered a sale for the purposes of s. 9.
However, a contracting out
(or contracting in
) of services, without more, is not usually considered a sale, even within the meaning of the expanded definition in s. 9. The contracting in/out of services is distinguished from a sale of business because the former typically involves simply a change in the way in which some function ancillary to the business is carried out rather than anything that could be said to amount to the transfer of a business or a part of a business. For example, if a retail employer had in the past provided its security staff with in-house self-defence training and subsequently engaged a private company to provide that training; it would be characterized as a contracting out of services
rather than a sale.
It is important to note that determining whether what has taken place is a sale of business (or part of a business) or is instead merely a contracting out or contracting in is very much a fact-specific determination. See, for example, the discussion of the Abbott v Bombardier Inc.
9(4) For the purposes of subsection (1), employment with the seller includes any employment attributed to the seller under this section or a provision of a predecessor Act dealing with sales of businesses.
Section 9(4) ensures the flow-through of length or period of employment attributed to a seller under the provisions of the current ESA 2000 or former Employment Standards Act.
In this example, pursuant to s. 9(4), the employee’s employment with corporations A, B and C will be treated as if it was employment with corporation D for purposes of those rights under the ESA 2000 that depend on period or length of employment.
This is because under the former Employment Standards Act, the sale from A to B and B's hiring of the employee resulted in the employee’s employment with A being attributed to B. The sale from B to C and C's hiring of the employee occurred after the current Act had come into force, and it resulted in the employment with B – including employment with A that was attributed to B under the former Employment Standards Act – being attributed to C. Likewise, the sale from C to D and D's hiring of the employee resulted in the employment with C – including employment with A and B that was attributed to C – being attributed to D.
10(1) This section applies if the building services provider for a building is replaced by a new provider and an employee of the replaced provider is employed by the new provider.
This provision is similar to ss. 13.1(2) and 13.1(3) in the former Employment Standards Act. It defines the circumstances in which s. 10 will provide continuity of employment when a provider of building services is replaced by a new provider and the new provider employs any of the replaced provider’s employees (subject to the rules regarding a hiatus or gap, s. 10(3)).
The terms building services
and building services provider
are defined in s. 1(1) of the ESA 2000 as follows:
These terms are discussed in more detail in ESA Part I, s. 1 and O Reg 287/01 of the Manual with respect to the termination and severance obligations of building services providers in Part XIX of the ESA 2000 (Building Service Providers) when employees of a replaced provider are not hired by the new provider.
Section 10(1) applies to provide continuity of employment if the following criteria are met:
employee of the replaced provider who is engaged in providing services at the premises and whom the new provider does not employ.See Betts v Brookfield Lepage Johnson Controls Facility Management Services Ltd., 2007 CanLII 12199 (ON LRB).
Section 10 applies where a building services provider stops providing services to a building and is replaced
by a new provider. In order to replace
the former building services provider, the two providers must be providing the same general category of building services at the premises. If, for example, a building owner discontinued its food service contract with A and contemporaneously entered into a security services contract with B, it would be difficult to see how B could be said to be replacing
A at the premises.
As noted above, s. 10 will apply to create continuity of employment only if the new provider hires an employee of the replaced provider (subject to the time limits in s. 10(3)). One issue that arises is how s. 10 applies if either the replaced provider or the new providers falls under federal jurisdiction:
Section 10 does not apply. The ESA 2000 only applies to employees and their employers (both replaced and new providers) who are provincially regulated, s. 3(2). Therefore, the new provider would not be required to consider the employee’s length or period of employment with the replaced provider.
Again, s. 10 does not apply because employment with an employer under federal jurisdiction would not be attributable to the new provider. This may arise as the reverse of the situation described above, e.g., where a bank (which is under federal labour jurisdiction) uses its own in-house staff to perform security services, but then contracts out those services to a security company.
See Rostrust Investments Inc./Investissements Rostrust Inc. v Doxtater, 2006 CanLII 41431 (ON LRB) in which the Board concluded that the continuity of employment provisions in the ESA 2000 did not apply where the former provider (Rostrust Investments Inc.) fell under provincial jurisdiction and the new provider (Public Works and Government Services Canada) fell under federal jurisdiction on the basis that s. 3(2) of the ESA 2000 specifically provides that the ESA 2000 does not apply if the employment relationship is within the jurisdiction of the federal government.
10(2) The employment of the employee shall be deemed not to have been terminated or severed for the purposes of this Act and his or her employment with the replaced provider shall be deemed to have been employment with the new provider for the purpose of any subsequent calculation of the employee’s length or period of employment.
Section 10(2) provides for continuity of employment
for an employee when there is a change in the provider of building services at a building if the new provider employs an employee of the replaced provider (subject to the s. 10(3) rules regarding a gap between employment with the new provider and the earlier of: (1) the last day of employment with the replaced provider and (2) the date the new provider began servicing the premises). In that case, the employee is deemed not to have had his or her employment terminated or severed for the purposes of the Act and employment with the replaced provider is included in any subsequent calculation of length or period of employment with the new provider for entitlements to:
The Program’s policy is that the employee’s length of service, for vacation with pay purposes, flows through from the replaced provider to the new provider. However, the liability for accrued vacation pay does not. This is because s. 76 of the Act requires building services providers who cease providing services at a premises, and who terminate the employment of an employee, to pay the employee all his or her accrued vacation pay (whether it was otherwise due or not) no later than the later of seven days after the termination of employment or on what would have been the employee’s next pay day.
An exception to the flow-through rule, as it applies to length of service, occurs if the new building services provider for a building hires the employee more than 13 weeks after the earlier of the employee’s last day of employment with the replaced provider and the day on which the new provider began servicing the premises. In this situation, the new provider is not required to recognize the employee’s length of service with the replaced provider, for the purposes of determining the employee’s entitlements to vacation under Part XI.
For a detailed discussion of the application of s. 76 see Part XIX, s. 76.
In addition to the information above regarding statutory leaves, it is important to note that there is nothing in s. 10 that would require a new building service provider to hire any employee of the replaced provider, including an employee of the replaced provider who was on a statutory leave at the time the new provider began providing services at the premises. In most cases however, where the new provider does not make a reasonable offer of employment to employees of the replaced provider, the new provider must comply with the notice and severance obligations under the Act with respect to those employees – see ESA Part XIX, s. 75. This would apply equally to employees who were on a statutory leave at the time. See ESA Part XIV, s. 53 for a discussion of rights to notice for employees who are legitimately terminated while on leave.
Where an employee’s employment is terminated and severed prior to the change of providers and for reasons unrelated to that change, the question may arise as to whether s. 10 would apply. Because the purpose of s. 10 is to undo
a common-law termination that would otherwise be triggered by the change of providers, it is the position of the Program that s. 10(2) does not apply where the termination or severance is not related in any way to the change. Thus, for example, if an employee’s employment was terminated by the replaced provider for wilful misconduct but they were hired by the new provider, s. 10(2) would not apply.
10(3) Subsection (2) does not apply if the day on which the new provider hires the employee is more than 13 weeks after the earlier of his or her last day of employment with the replaced provider and the day on which the new provider began servicing the premises.
While in many change of provider
situations, the employee’s first day of employment with the new provider will follow immediately after his or her last day of employment with the replaced provider, there will also be situations where there are short interruptions in employment. Section 10(3) provides, in effect, that s. 10(2) will apply only if no more than 13 weeks separate the first day of employment with the new provider and the earlier of:
The term last day of employment with the replaced provider
simply means the last day on which the employee is employed by the replaced provider for purposes of the ESA 2000. Bearing in mind that both active and inactive employment counts as employment for purposes of the ESA 2000 [see s. 59(1) and s. 65(2)], this will include time spent on lay-off up to the point at which a termination or severance would be triggered.
Note that for purposes of s. 10(3), the first day of the lay-off would not be considered the last day of employment with the seller. While some might argue that it should be so considered because of s. 56(5), which deems the first day of a lay-off that ends in termination to be the day on which the employee’s employment is terminated, this argument ignores the fact that s. 10(3) refers to the last day of employment
, not the day on which the employee’s employment was deemed terminated
; it also ignores the fact that s. 10(2) applies for all rights under the Act that depend on how long an employee has been employed and not just for purposes of notice of termination or termination pay in lieu.
If an employee on lay-off is potentially entitled to both termination pay and severance pay, his or her last day of employment will be considered, for purposes of s. 10(3), to be the later of (a) the day on which a termination would be triggered and (b) the day on which a severance would be triggered. For example, if an employee potentially entitled to both termination pay and severance pay is put on lay-off and benefits are not maintained and none of the other conditions described in clauses 56(2)(b) or (c) of the Act are met, his or her employment would be considered terminated once more than 13 weeks had passed, and severed once 35 weeks had passed. For purposes of s. 10(3), therefore, his or her last day of employment with the replaced provider
would be considered to be the final day of the 35th week; if the new provider hired the employee within 13 weeks of the earlier of that day and the day of the sale, there would be continuity insofar as any subsequent calculation of length of employment or period of employment was concerned.
If the employee did not have a potential entitlement to severance pay (say, because they would not have accumulated five years of employment with the employer in total as of the end of 35 weeks of lay-off, or because his or her employer did not have a payroll of at least $2.5 million) the last day of employment
would be considered to be the final day of the 13th week of lay-off; if the new provider hired the employee within 13 weeks of the earlier of that day and the day on which the new provider began servicing the premises there would be continuity insofar as any subsequent calculation of length of employment or period of employment was concerned.
It should also be noted that the deemed termination date as set out in s. 56(5) has no application on any subsequent liability a new provider may have for notice or termination pay where there is continuity of employment under s. 10, because under s. 10(2), the employment would be deemed not to have been terminated, even if the employee was not hired by the new provider until after the lay-off had exceeded the period of a temporary lay-off. For example:
10(4) For the purposes of subsection (2), employment with the replaced provider includes any employment attributed to the replaced provider under this section or under a provision of a predecessor Act dealing with building services providers.
This provision was introduced with the ESA 2000. Section 10(4) ensures the flow-through of length or period of employment attributed to a replaced provider under the provisions of the ESA 2000 or the former Employment Standards Act. (The first continuity of employment provision in the context of building service providers was proclaimed into force on January 1, 1993, but it applied in respect of changes in providers that occurred after June 4, 1992.)
In this example, pursuant to s. 10(4), the employee’s employment with contractors A, B and C will be treated as if it was employment with contractor D for purposes of those rights under the Act that depend on length or period of employment.
Note: Under the former Employment Standards Act, the change in providers from A to B and B's hiring of the employee resulted in the employee’s employment with A being attributed to B, because the change occurred after June 4, 1992. The changeover from B to C and C's hiring of the employee occurred after the current Act had come into force, and it resulted in the employment with B, including employment with A that was attributed to B under the former Act, being attributed to C. Likewise, the changeover from C to D and D's hiring of the employee resulted in the employment with C, including employment with A and B that was attributed to C, being attributed to D.
Part V of the Employment Standards Act, 2000 (Payment of Wages) is intended to ensure that employees receive wages for work performed. This Part regulates the payment, manner and place of payment of wages, deductions from wages, and the priority of wage claims over other unsecured creditors. It also establishes obligations with respect to the provision of statements of wages and outlines the information required on such statements.
The provisions regarding vacation statement obligations previously contained in s. 12(1)(d) of this Part of the ESA 2000 were repealed by the Government Efficiency Act, 2002, SO 2002, c 18, which came into force on November 26, 2002. They were replaced with new vacation statement obligations set out in s. 41.1 of Part XI (Vacation with Pay).
Lastly, a new requirement to provide a statement of wages paid when employment ends was added by the GEA 2002 (s. 12.1 (new)).
Subsection 11(1) requires employers to:
The regular pay day could be weekly, bi-weekly, semi-monthly, monthly or any specified period. An employer may establish different recurring pay days for different employees, and for different components of the wage package, e.g., sales commissions, overtime.
The question has arisen as to whether an employer is in compliance with s. 11 where the contract establishes a recurring pay day but further provides that if that recurring day should fall on a weekend or a statutory holiday that the following business day is considered the recurring pay day. The Program’s position is that s. 11 requires the establishment of a fixed period of time and a fixed date upon which an employee can expect to receive wages earned within the fixed period of time. The contract provision described above has the effect of creating a floating pay day that puts employees at a disadvantage as they are required to wait in certain cases for a longer period of time before receiving the wages earned in the pay period. As a consequence, Program policy is that such a contract is not in accord with the requirement in s. 11 to create a recurring pay day.
The question has arisen as to how an employer is required to pay wages to an employee who is subject to an overtime averaging arrangement: is the employer required to pay the employee straight time for every hour worked within the pay period - including those over 44 - and postpone paying only the extra half
of any overtime pay owing until the averaging period has ended? Or is the employer required to pay straight time only up to 44 hours a week and can postpone paying the entire time-and-a-half for any overtime pay owing until after the averaging period has ended?
It is Program policy that the employer is required to pay the employee straight time for each hour worked within the pay period, including those hours over 44 and then pay the extra half of any overtime pay owing after the averaging period has ended.
For example, pursuant to ESA Part VIII, s. 22, an employee's hours of work are averaged over four work weeks and works the following hours:
Assume the employee has a weekly pay period and is subject to an overtime threshold of 44 hours.
The employee worked, on average, one hour of overtime in each week.
The employer is required to pay the employee:
The requirement to establish a recurring pay period and pay day does not prevent the employer from subsequently establishing a new and different pay period or associated pay day. It should be noted, however, that in some situations such a change, if it is a substantial change in the terms and conditions of employment or a breach of a fundamental term of the employment contract, may constitute a constructive dismissal and thus potentially be a termination and a severance of employment.
If a contract establishes an entitlement that falls within the definition of wages, that entitlement can be enforced through s. 11, even if there would otherwise be no entitlement under the ESA 2000. For example, if an employee was exempt from overtime pay under the ESA 2000 but the contract provided for overtime pay (e.g., a premium rate to be paid once the employee worked a certain number of hours), any unpaid contractual overtime pay would be enforceable as unpaid wages under s. 11.
It is essential, for assessment or enforcement purposes, to review the terms of employment to ensure that the wages in question are earned during the pay period. For example, in the area of sales commissions or bonuses, innumerable variations exist on when in fact they are considered to have been earned and therefore due to be paid.
In Ingersoll Machine & Tool Co. Ltd. v Griffin et al (August 9, 1982), ESC 1263 (Picher), Referee Picher ruled that where the former Occupational Health and Safety Act required the employer to pay employees for attendance at joint health and safety committee meetings under that Act, such payment could be enforced as wages under the predecessor provision to s. 11(1) in the former Employment Standards Act, on the basis that rights under statutes other than the Act were incorporated into the contract of employment. Note that the current Occupational Health and Safety Act, RSO 1990, c O.1 continues to provide employees with the right to be paid for time associated with such meetings and therefore such wages are likewise recoverable under the ESA 2000.
Under the Municipal Elections Act, 1996, SO 1996, c 32, the Ontario Election Act, RSO 1990, c E.6, and the Canada Elections Act, S.C. 2000, c 9, an employee who is qualified to vote has the right to three consecutive hours for the purpose of voting during the period the polls are open. Those acts do not require the employer to give employees three hours off during working hours, but if an employee's working hours are such that the employee does not have three consecutive hours outside of their shift during the period the polls are open, the employer must give the employee time off to ensure that they do have three consecutive hours to vote. By way of prohibiting deductions from an employee’s pay, all three statutes require the employer to pay the employee for such time off work. Under ESA Part I, s. 1, wages are defined to include monetary remuneration payable by an employer to an employee under the terms of an employment contract, oral or written, express or implied.
The Program’s position is that the right to any paid time off to vote is a statutory term of the employment contract and that payment can accordingly be enforced as wages under s. 11.
This section requires payment of all wages in cash, by cheque, direct deposit in accordance with s. 11(4) and any other prescribed method of payment.
Payment of wages is to be made in cash (legal tender in Canada) or by cheque that is negotiable for legal tender. If payment is made by cheque, the cheque must be payable only to the employee. If payment is made by direct deposit, the payment must be made to an account in the employee's name to which only the employee and persons authorized by the employee have access – see ss. 11(4). There are currently no additional methods of payment prescribed by regulation.
There is nothing to prevent an employment contract providing for additional non-wage forms of compensation, e.g., food, bus or subway tickets or merchandise to an agreed value, provided the employment standards (e.g., minimum wage standards) have been met. However, note that benefits such as transportation, food, bonuses or other assistance could not replace the required payment of wages by cash, by cheque or by direct deposit. See Peter Muscat General Contracting v Buttigieg (September 7, 1978), ESC 543 (Davis). Also note that the enforcement of non-wage payments of this nature would lie beyond the Program’s jurisdiction.
Section 11(3) requires that wages paid by cash or cheque must be given to the employee at the workplace or an alternate location agreed upon by the employee. Such an agreement must be in writing as required under ESA Part I, s. 1(3). In the absence of such an agreement, payment must be made at the workplace.
Under ESA Part III, s. 7, an employee's agent (e.g., trade union) may agree on behalf of the employee to an agreement under this provision to designate some other place for the payment of wages.
Under s. 11(4), an employer choosing a direct deposit payment arrangement may only deposit wages to an account at a financial institution:
An additional condition that had previously been in the Act – that an office or facility of the financial institution be located within a reasonable distance from the workplace, unless the employees agrees in writing otherwise – was repealed by the Supporting Recovery and Competitiveness Act, 2021, effective June 3 , 2021. As such, there are no longer any geographic restrictions in the ESA with respect to where the institution (or its offices or facilities) into which an employee’s wages are deposited can be located.
In order to make payments by direct deposit, it is necessary that the employee have an account at a financial institution to which only they (or person authorized by the employee) have access.
An employer may make having such an account a condition of employment and where an employee is directed to open an account, including at a particular institution, and refuses, the employer may terminate the employee without running afoul of the reprisal provisions of the ESA 2000. This is because in such a case, the employee is not engaging in any activity that is protected by the anti-reprisal provisions. In particular, there is no right under the Act to not open an account or to not be paid by direct deposit. The employer would of course be required to comply with the notice of termination and severance provisions in ESA Part XV.
The Program considers the reference to “direct deposit” in ss. 11(4) to include Interac e-Transfers (i.e. where money is transferred from one bank account directly into another). As such, employers may pay wages by Interac e-Transfer so long as the conditions set out in paragraphs (a) and (b) are met. This is the case whether or not the employer and/or employee chose to use the security question feature with the e-transfer. Note, however, that if the money is not actually deposited into the employee’s account the employer will not be considered to have paid the employee’s wages. This could happen, for example, if the employee fails to take a necessary step to electronically accept the deposit within the allotted time, or if the money is inappropriately diverted to someone else’s account (such as where someone hacked into the employee’s email and directed the money to a different bank account).
Under s. 11(5), any wage entitlements owing to an employee whose employment has ended must be paid out no later than the later of seven days after employment has ended and the next regular pay day. In allowing the employer to choose the later of seven days after the employment ended and the regular pay day following the date the employment ended, the employer has some flexibility to use regular processes (e.g., the employer’s computerized payroll system rather than having to cut a manual check) to make the final payment to the employee.
In this regard it should be noted that the pay day referred to in paragraph (b) is not necessarily the pay day that covers the period to the date of termination, but is rather the very next pay day to fall after the date employment ends.
The employee in this example will therefore be entitled to payment of any outstanding wages on January 31, not February 15.
Finally, it should also be noted that s. 11(5) does not relieve the employer in any way of its obligation to pay the wages earned in any given pay period on the regular pay day for that pay period as per s. 11(1).
Under s. 11(1), the employer must still issue a pay cheque as usual on October 2 for the wages earned in the pay period ending on September 25.
And, in addition, s. 11(5) will require payment of any other outstanding wages to which the employee was entitled on termination (e.g., the wages earned September 26 to 30, any termination pay in lieu of notice, severance pay, vacation pay and public holiday pay for a substitute holiday that had not been taken) on October 7, the day that is the later of seven days after the termination, or October 2, the next pay day following the termination.
Section 12 creates a requirement that ensures an employee receives, at the time wages (other than vacation pay) are paid, a detailed statement that demonstrates how his or her gross and net wages have been calculated. It is not necessary that all the information required in s. 12 be contained in a single document; the written statement may consist of one or more documents. The Government Efficiency Act, 2002, SO 2002, c 18 (GEA 2002
) repealed s. 12(1)(d), which set out the vacation statement obligations. Those obligations are now set out in ESA Part XI, s. 41.1.
Even though an employee may be aware in one way or another of the details concerning his or her pay and despite the fact that the details may remain unchanged from pay period to pay period, a written wage statement is required on or before each pay date.
Tips and other gratuities do not fall within the definition of wages. Therefore, the ESA does not require employers to include information about tips and other gratuities on wage statements.
It is Program policy that an employer can provide the written statement by way of a secure internet accessible database and be in compliance with s. 12(1), even though an individual wage statement is not personally sent in any format to the employee, if the employees have a reasonable opportunity to access the database and a printer (and know how to use them) on or before their payday. If the employee works at a location other than the employer’s workplace (for example, an employee of a temporary help agency who is providing services at a client’s office), the employer may comply with s. 12(1) if the employee is provided with access to a computer and printer at the client’s place of business.
The written statement must contain the following information:
Pursuant to s. 12(1)(a), the written statement must state the pay period for which the wages are being paid. This requirement is satisfied if the statement identifies, in a way understandable to the employee, the pay period to which the statement pertains. This would typically be by showing the start and end dates of the pay period, but other ways of identifying the pay period might also be used, such as, for example, by indicating that the pay period is period #2 in the 26 pay periods for this year.
Under s. 12(1)(b), the written statement must contain the wage rate, if there is one. This would include all special
rates of pay, e.g., overtime rate, premium rate or shift rate in addition to the regular
rate.
Under s. 12(1)(c), the written statement must contain the gross amount of wages and, unless the information is provided in some other manner, how that amount was calculated. This requirement is satisfied if the wage statement shows:
Under s. 12(1)(e), the written statement must contain a description of each deduction and the amount.
Under s. 12(1)(f), the written statement must contain any amount with respect to room or board that is deemed to have been paid to the employee under ESA Part X, s. 23(2). Where this clause applies, the prescribed amount of room and board is deemed to be wages paid to the employee. See O Reg 285/01, s. 5(4), s. 19(2) and s. 25(5) for the prescribed amount.
Under s. 12(1)(g), the written statement must contain the net amount of wages bein paid to the employee.
Prior to the repeal of s. 12(2) and s. 12(1)(d) by the GEA 2002, which came into force on November 26, 2002, s. 12(2) provided that the information regarding vacation pay detailed in the former s. 12(1)(d) did not need to appear in the wage statement for a pay period in which one or more vacation days were taken, if the employer was paying vacation pay in accordance with ESA Part XI, s. 36(3) as it read prior to amendment by the GEA 2002.
Section 12(2) was replaced with ESA Part XI, s. 41.1(5). Section 41.1(5) similarly provides that the vacation statement obligations set out in ESA Part XI, s. 41.1 do not apply if the employer is paying vacation pay that accrues in each pay period on the pay day for that pay period, and provides a statement of wages that sets out vacation pay separately from the other wages being paid or provides the employee with a separate statement setting out the amount of vacation pay being paid in accordance with s. 36(3) as amended by the GEA 2002.
Section 12(3) permits an employer to provide a wage statement to an employee using a confidential electronic mail system to convey the information, instead of a paper document. However, an employer may only provide a statement by electronic mail where the employee has access to the means of making
a paper copy of the document.
Under s. 12, it is the employer’s responsibility to ensure that a wage statement is provided. Where the employee's access to a means of making a paper copy
is outside the employer’s control, the employer will not be able to ensure the provision of a statement; therefore, access to a means
must be interpreted to mean at the workplace
.
Some examples of situations where this section’s requirements will not be met include:
Confidentiality will be a reasonable expectation with regard to the employee's ability to make a copy of his or her own wage statement under s. 12(3).
See the discussion above at s. 12(1) for a discussion of wage statements that are provided via a secure internet accessible database.
This section was added to the Employment Standards Act, 2000 by the Government Efficiency Act, 2002, SO 2002, c 18, which came into force on November 26, 2002. Section 12.1 requires employers to provide a statement with respect to wages (including vacation pay) paid on termination of employment on or before the day on which the employer is required to pay wages under s. 11(5). It also requires the employer to provide information in the statement as to how the gross amounts of termination pay, severance pay, vacation pay and any other wages in addition to those amounts was calculated, unless that information is provided in some other way by the employer.
Section 13(1) establishes a general rule prohibiting an employer from:
For the balance of this chapter, reference will generally be made only to deductions, but the discussion should be understood as covering an employer’s withholding of wages and an employer causing wages to be returned to the employer as well.
Note that pursuant to O Reg 285/01, s. 3.1, s. 13 of the Employment Standards Act, 2000 does not apply to an employer who participates in an Ontario Municipal Employees Retirement System (OMERS
) pension plan under the Ontario Municipal Employees Retirement System Act, 2006, SO 2006, c 2, but only with respect to the fees that a by-law made under s. 28 of that Act requires the employee to pay.
The purpose of s. 13(1) is to protect the employee from improper interference with their earnings by ensuring that an employer who owes wages is not in the position of being both a claimant against the employee and an arbiter of the validity of the claim. The exceptions to the general prohibition against deductions in s. 13(1), as set out in ss. 13(2) and 13(3), underline this principle by permitting deductions where a statute of Ontario or Canada, a court order, or the employee's written authorization permit the deduction. In such cases, someone other than the employer, such as a legislature, a court, or the employee, has determined that the employee owes the money to be deducted.
It is important to note that what s. 13(1) prohibits is deductions from wages, i.e., deductions from the monetary remuneration that an employee is entitled to under their employment contract. The contract may provide a formula for calculating an employee's wage entitlement and that formula may involve a deduction being made at some point in calculating what the employee's wage entitlement is; however, such a deduction is not a deduction from wages, but rather a step taken in calculating what wages are due. For example, an employment contract may provide that the employee will be entitled to a yearly bonus that is calculated as $X amount per unit of productivity minus the amount of shrinkage and shortages that take place during the year. While the bonus constitutes wages within the meaning of the definition in the Act, no deduction is being made from wages in this case; rather, the deduction is part of the calculation that is necessary to determine the amount of wages. The distinction between a deduction from wages and a deduction that is a step in the calculation of what wages are owing is a longstanding one. See Sagar v Ridehalgh & Sons Ltd., [1931] 1 Ch 310, Becker Milk Company of Canada Limited v Ure (December 14, 1985), ESC 2002 (Egan) and Fruitman v Stephenson’s Rent All Inc., 2000 CanLII 3317 (ON LRB).
However, it should also be noted that a deduction made in the course of calculating what wages are due, unlike a valid deduction from wages, must not produce a result that is less than the minimum wage or, where overtime hours are worked, less than an employee's overtime pay entitlement under the ESA 2000.
Thus, if the employment contract provides a formula that involves a deduction in order to calculate what the employee's wages are, it would be a violation of the minimum wage provisions if the employee ends up receiving less than the minimum wage. Note, however, that compliance with the minimum wage is determined on a pay period basis, not on a per hour basis.
Also note that compliance with the limits on hours of work must be determined on the basis of actual hours of work, and not on provisions in the employment contract that might in some circumstances deem the employee to have worked less time than they in fact did.
An employee has a regular work week of nine hours per day, five days per week, with shifts beginning at 9 a.m. each day. Their regular rate is $17.00 per hour. However, under the terms of the employment contract, if they punch in more than five minutes but less than 15 minutes late, the wages with respect to the first scheduled hour of work (9 a.m. to 10 a.m.) are calculated as if they had worked only 45 minutes, even if the employee worked, for example, 54 minutes in that hour. If the employer pays the employee $767.13 for the week in accordance with the contract (based on 44 hours and 45 minutes, with the 45 minutes paid at the rate of one and a half times the regular rate), there will be an overtime pay violation; as there were actually 54 minutes of overtime worked, the employee should have been paid $770.95
Consider the slightly different example of an employee with a regular work week of eight hours a day, five days a week, and a regular rate of $17 per hour. If the employment contract provides that the employee will be paid for only 45 minutes if they punch in more than five minutes but less than 15 minutes late, and the employee punches in six minutes late, there will be no violation if the employee receives only $675.75 for the week. While the employee was paid for only 45 minutes even though they actually worked 54 minutes out of the first scheduled hour on the day they were late, they received all the monetary remuneration that was due to them under the contract and the calculation of wages under the contract does not result in any violation of the hours of work, overtime or minimum wage provisions of the Act. Note that $675.75 when divided by 39.9, the number of actual hours worked in the week, produces $16.94, which is in excess of the minimum wage.
What if the employee in the preceding example was just being paid minimum wage, which at the time of writing was $15.00? If the employer treats the employee as having worked only 39.75 hours in the week in question and pays the employee $596.25 for the week, there will be a violation of the minimum wage requirements, because $596.25 divided by 39.9 (the employee's total hours for the week) equals $14.94, which is less than the minimum wage. The employer should have paid the employee $598.50 (39.9 x 15).
In addition, referees under the former Employment Standards Act have held that the employer may deduct wages paid in error in the past from an employee's pay cheque. As the referee pointed out in All-Way Transportation Services Ltd v Fountain (June 6, 1979), ESC 627 (Brent) when an employee is overpaid, they were never entitled to the amount that the employer seeks to deduct, so it cannot be regarded as wages payable in the first place.
In some cases, an overpayment may have arisen from a failure to make an authorized deduction. For example, an employee may have provided the employer with a written authorization to deduct a specific sum from each pay cheque in respect of the company benefit plan. Where the employer inadvertently fails to make the deduction, resulting in an overpayment to the employee, the employer may recover the monies paid out in error without obtaining any additional authorization to do so.
In cases where the employer has made an overpayment, it can recover those monies from the employee's wages, whether they are regular wages, vacation pay or termination pay.
Note that although ESA Part XV, s. 60(1)(b) requires the employee to be paid no less than their regular wages during the notice period that this provision is intended to protect the employee's right to continue to earn their regular wages - it does not conflict with the employer’s right to recover an overpayment of wages.
Note, however, that where an employer intentionally pays an employee more than the Act entitles the employee to, this is not an overpayment but rather a payment that they are entitled to under their contract of employment. Such an amount would, therefore, fall within the definition of wages. The employer cannot deduct the amount of such a payment from subsequent earnings without a written authorization for deduction by the employee. Further, if there is a written authorization for deduction, but it refers only to deductions for overpayments, the authorization cannot be used, as the payment was not in fact an overpayment. See Ozorak v Econome and 802710 Ontario Inc. (April 20, 1999), 4320-97-ES (ON LRB) where the employer intentionally paid an employee for a public holiday that the employee was not entitled to under the former Employment Standards Act.
An advance payment of wages may be deducted. In 473321 Ontario Limited, c.o.b. Malkat Peking v Cohen (April 3, 1984), ESC 1602 (Swan)the referee noted that just as amounts that are due and actually paid by an employer before termination may be taken into account in determining the payment due on termination, so may amounts that were expressly paid as an advance on amounts to become due in the future. 431650 Ontario o/a Eglinton Fine Foods v Lombardo (April 9, 1985), ESC 1821 (Egan) should also be noted. The claimant was given four weeks' notice when he was entitled to eight weeks. He obtained another job immediately after this four-week period. The applicant argued that the earnings of the employee from the new employer during the second four-week period of notice to which he was entitled by statute should discharge his obligation for payment in lieu of notice to the extent of those earnings. Citing s. 8 of the former Employment Standards Act, the referee rejected this argument, holding that none of the enabling factors in the regulations applied.
Tips and other gratuities are excluded from the definition of wages. Therefore, s. 13(1) does not apply to deductions from tips and other gratuities. Please see the discussion at ESA Part V.1, s. 14.2(1) for information on deductions from tips and other gratuities.
Section 13(2) sets out the exceptions to s. 13(1) that permit an employer to make deductions against an employee's wages where the deduction is authorized by a statute of Ontario or Canada, or a court order. Section 13(2) is subject to s. 13(4).
Tips and other gratuities are excluded from the definition of wages. Therefore, s. 13(2) does not apply to deductions from tips and other gratuities made pursuant to statute or court order. See the discussion on ESA Part V.1, s. 14.3 for more information on deductions from tips and other gratuities made pursuant to statute or court order.
The most frequently encountered deductions authorized by statute are for income tax, Canada Pension Plan (“CPP”) contributions and employment insurance (“EI”) premiums.
In addition to authorizing deductions for EI premiums, the Employment Insurance Act, SC 1996, c 23, requires a deduction from wages payable to an employee as a result of a court order or arbitration award made against the employer where the employer has reason to believe that the employee received EI benefits for the same period to which the order or award relates. The deducted amount must be remitted to the Receiver General.
An employment standards officer should check with the Canada Revenue Agency if an employee alleges that deductions made by the employer in purported compliance with income tax, CPP or EI legislation were not authorized.
It sometimes occurs that an employer who failed to deduct amounts for income tax, CPP contributions or EI premiums (because, for example, the employer incorrectly treated the employee as an independent contractor), seeks to catch up by deducting the amounts that should have been deducted in the past all at once (sometimes going back several years) from the employee's current regular wages or termination pay. Both s. 21(4) of the Canada Pension Plan, RSC 1985, c C-8 and s. 82(6) of the Employment Insurance Act the EI legislation address this situation by limiting the catch-up to one additional deduction for each pay period (i.e., the deduction that would currently be required for the pay period plus one further pay period’s deductions) and prohibiting any catch-up for amounts that should have been deducted more than 12 months previously.
These limitations equally apply to the employee's final pay cheque at the end of an employment relationship, even though it means that there will be no further opportunity for the employer to make up
for the missed deductions. See Firlotte v Angus operating as Blythe Farm (May 30, 1995), ESC 95-101 (Wacyk).
One question that might arise is whether a deduction authorized pursuant to a regulation would be permitted under s. 13(2). For example, in the context of the Employment Protection for Foreign Nationals Act, 2009, employers are generally prohibited from recovering or attempting to recover from a foreign national any cost incurred by the employer in the course of arranging to become or attempting to become an employer of the foreign national. This prohibition does not apply with respect to costs that are prescribed. Ontario Regulation 348/15 prescribes such costs; it permits employers who employ a foreign national in Ontario under an employment contact made pursuant to the federal government’s Seasonal Agricultural Worker Program (“SAWP”) to recover from the foreign national costs of air travel and of work permits, if the contract allows these deductions. If these permitted costs were deducted from wages, it would not constitute a violation of s. 13 since the regulation specifically authorizes the employer’s cost recovery.
Section 13(2) allows deductions pursuant to a court order.
This provision states that an employer may make a deduction from an employee's wages if a . . . court order authorizes it.
It is Program policy that a deduction is allowed under s. 13(2) only if a court order explicitly states that a deduction may be made from wages. This can include wages held in trust where an employer has filed an application for review under ESA Part XXIII, s. 116. It is not enough that the employer is in possession of a court judgment declaring that the employee owes a debt to their employer; there must be a court order specifically providing that the debt can be satisfied by way of a deduction from wages.
Note that Program policy previously provided that there was no requirement for the court to specifically authorize a deduction from wages; however, in accordance with more recent decisions, it is now Program policy that there must be a specific authorization. See for example, Minnema Farms Ltd v Demaat, 2014 CanLII 668 (ON LRB).
Many (though not all) deductions that are lawful under s. 13(2) involve court ordered garnishment of wages. Note however, that under s. 7 of the Wages Act, RSO 1990, c C.44, 80 per cent of an employee's net wages (i.e., gross wages less tax, EI and CPP) are exempt from garnishment. If the garnishment is for the enforcement of a support order, only 50 per cent of net wages are exempt. A judge issuing a garnishment order has discretion to decrease or decrease the percentage of the net wages that are exempt. Program staff should not attempt to provide advice concerning the Wages Act, which is administered by the Ministry of the Attorney General. Persons with enquiries about that Act should be directed to the Crown Law Office-Civil Division of that Ministry.
Section 13(3) permits an employer to withhold wages, make a deduction from wages or have an employee return wages if the employee has provided a written authorization to do so. Note that ss. 13(4) and 13(5) set out specific exceptions to s. 13(3).
As provided in s. 13(3), an authorization must be in writing to be valid; an oral authorization is not sufficient. The following decisions under the former Employment Standards Act are relevant: 509245 Ontario Ltd. c.o.b.a. Yates Electric v Groulx and Heighington (November 21, 1985), ESC 1987 (Brown)and Crick c.o.b. Keith’s Restaurant v Popko et al (December 14, 1982), ES 1344 (Egan).
However, in Consolidated Press Company Limited v Leko (November 10, 1983), ESC 1511 (Aggarwal), also a decision under the former Employment Standards Act, a deduction was allowed in the absence of a written authorization. The claimant had verbally agreed to a monthly deduction for parking, and had accepted cheques marked on that basis for three years. The referee noted that according to Black’s Law Dictionary, a written instrument is merely evidence of a contract. He found, therefore, that where a clear, express, bona fide contract establishing the employee's obligation to pay through payroll deductions existed, and had been implemented for a long time, the mere absence of a formal written authorization should not make such deductions illegal. Apparently, the referee was concerned that the claimant was attempting to use the section as an instrument of fraud, rather than as a shield against fraud by the employer, which is its intent. The case, however, is contrary to Program policy and should not be followed.
It should be noted that in another case under the former Employment Standards Act, Tavares and Sgromo c.o.b. Mr. Submarine, Thunder Bay, Ontario v Coppola et al (April 13, 1982), ESC 1197 (Aggarwal), the same referee held that the similar acceptance of a pay cheque every two weeks without objection with full knowledge and understanding that the deductions had been made for cash shortages did not amount to written authorization.
A written authorization must in fact specify that a deduction from wages is authorized. For example, in 555149 Ontario Limited c.o.b.a. Discount Car and Truck Rentals v Mason (March 20, 1985), ESC 1809 (Davis), the employee signed the following statement: I … agree to pay Discount Car Rentals the amount of 5,000.00 in monthly instalments of 200.00 … per month for the damage of the car.
The referee held that while this document was an acknowledgement of a debt and an undertaking to liquidate it by monthly instalments, it did not authorize the employer to make a deduction from wages. A similar finding regarding an agreement to pay for damages done to the employer’s car was made in Windsor Wholesale Produce Limited v Donnelly et al (August 30, 1984), ESC 1712 (Gorsky). Both of these cases were decided under the former Employment Standards Act. Note that had the referees in either case concluded that there was an authorization to deduct from wages, the exception in s. 13(5) may have applied to prohibit the deduction in any event. That subsection makes an exception to allowing deductions that are authorized in writing if the wages are being deducted for faulty work.
Terms and conditions outlined in a policy manual do not constitute a written authorization. Such a manual might create a liability, but it is not an authorization by the employee to deduct from wages. See the following decisions under the former Employment Standards Act: Highbury Ford Sales Ltd. v Richards (May 5, 1986), ESC 2101 (Bryant) and 307855 Ontario Limited o/a the 54 Restaurant v Vlahovich (January 27, 1986), ESC 2031 (Adamson).
Employees sometimes enter into wage assignments in which the employee agrees that their wages may be paid over to another party. Such assignments are generally prohibited under the Wages Act. A wage assignment is therefore not generally considered a valid authorization to deduct wages under the ESA. However, there is an exception to this prohibition found in s. 7(8) of the Wages Act which provides that wage assignments by employees to credit unions to which the Credit Unions and Caisses Populaires Act, RSO 1990, c C.44, applies are valid. As a result, if an employee enters into an agreement with such a credit union, whereby the credit union is authorized in writing to garnish the employee's wages if they default on a loan, and the employee does default, the employer may honour the assignment to the credit union. The wage assignment will, in that case, be considered a valid written authorization and the employer will not be in contravention of s. 13(1) if it abides by the wage assignment and forwards a portion of the employee's wages to the credit union. Note, however, that the Wages Act provision that exempts 80% of an employee's net wages from garnishment also applies to wage assignments to credit unions. That percentage can be increased or decreased by court order.
A second exception to the prohibition against wage assignments arises where the assignee is the Crown because the Wages Act doesn't apply to the Crown. As a result, assignments made under the Ontario Disability Support Program Act, 1997, SO 1997, c 25, Sch B are not prohibited by the Wages Act because the payee under that Program is Her Majesty the Queen in right of Ontario as represented by the Minister of Community and Social Services (i.e., the Crown). An assignment made under that Program would therefore be considered a valid written authorization for a deduction from wages. Note that what is determinative is whether the Program is a provincial government program. For example, an assignment made under the Ontario Works Act, 1997, SO 1997, c 25, Sch A, in which the assignment is made in favour of either a municipality or another delivery agent, would be prohibited under the Wages Act because the assignee is not the Crown.
A written authorization from an employee allowing a deduction from wages if the employee quits would not be valid where the employee resigns but is regarded by law as having been constructively dismissed. Despite the fact that the employee has quit, the law treats such a quit as if it were a termination by the employer. A constructive dismissal may be found to have occurred where:
making life miserablefor them; or
choiceof either quitting or being fired.
For the purposes of the Act, the employee in these circumstances would not be found to have quit, but rather to have been constructively dismissed. Thus, the situation is not covered by the terms of the deduction authorization.
Finally, under Program policy, such issues as inequality of bargaining power of the parties at the time the authorization was given, or the fact that the employer may be attempting to redress what they consider to be a shortcoming in the legislation as it is currently written, are not relevant to a consideration of the validity of a written authorization. Further, it is considered of no importance that:
Section 13(4) provides that where a deduction may be made from wages under s. 13(2) or s. 13(3) as required by statute, court order or as allowed by an employee's written authorization and such statute, order or authorization requires the employer to remit the wages deducted or withheld to a third person, and the employer fails to do so, the deduction will not be valid.
For example, an employer may make statutory deductions for income tax, CPP or EI, but fail to remit the funds on the employee's behalf to the Canada Revenue Agency. Where it is found that funds were withheld or deducted from the employee's wages but not remitted to the third party, this will be a violation of s. 13(4) and the officer may, in addition to other enforcement action under the Act, issue an order to pay under ESA Part XXII, s. 103, to effectively return the unremitted funds to the employee.
Section 13(5) prohibits an employer from withholding wages, making deductions from wages or causing an employee to return wages in certain circumstances, even though the employer has a written authorization from the employee to make the deduction in accordance with s. 13(3).
Under s. 13(5)(a) the written authorization must set out either the specific amount to be withheld, deducted or returned, or provide a formula that enables the employee to calculate the specific amount.
In Superior Service Station Maintenance Ltd. v Edward et al (November 2, 1977), ESC 457 (Springate), a decision under the former Employment Standards Act, a job application form contained an authorization for deductions. However, the referee held that it constituted a blanket authorization for deduction of unliquidated damages obtained by the employer as a condition precedent to employment, and as such was unenforceable.
In fact, other referees have held, and it is consistent with the policy of the Program, that any blanket authorization under which an employee purports to authorize deductions of unspecified amounts is invalid. However, if the employee has affirmed the applicability of the authorization to a particular deduction, that is, when the employee can better appreciate its specific nature and order of magnitude, it may be valid for the purposes of s. 13(5)(b)(i) and (ii). See Georgetown Motors Ltd. v Coleman (December 12, 1986), ESC 2203 (Adamson) and Ronyx Corporation Limited v Ritenburg (March 19, 1984), ESC 1593 (Sheppard). For example, if an employee signs a blanket authorization for the deduction of the price of merchandise that the employee purchases from the employer, the authorization will be valid provided that the employee subsequently acknowledges purchasing merchandise for the amount in question.
Another issue is the validity of an authorization purporting to allow an amount to be deducted from wages if the employee does not provide the employer with notice in the event that they quit. Program policy is that if the authorization is specific as to the amount of notice required of the employee and as to the amount to be deducted if that notice is not provided, it will meet the requirements of the Act, and will be valid.
Accordingly, an authorization to deduct for failure to give sufficient notice or simply notice, without an actual amount of notice specified, will not be valid. Further, a reference to a deduction for damages or any amounts owing at the time of resignation will be insufficient for lack of specificity. Although an actual dollar figure is not required, the authorization must clearly demonstrate the employee's agreement to the deduction of a precise amount (e.g., one week's pay, the first week's pay or the last week's pay) would be sufficiently specific, as would final vacation pay, even if the amount is not precisely quantifiable when the authorization is signed.
Also, a written authorization respecting failure to give notice of resignation would be invalid if the amount to be deducted constituted a penalty rather than a genuine attempt to pre-estimate damages. For example, an amount that would be a penalty rather than a genuine pre-estimate is the following:
An employee works as a security guard. The employer has employees on-call to fill in for the employee when he is unable to work. The employee signs a written authorization that he will forfeit his last two weeks' wages and all his vacation pay if he resigns without giving four weeks' written notice. In that situation, the amount to be withheld is clearly all out of proportion with the damages that the employer might reasonably be expected to suffer if the employee resigned without notice or with less than four weeks' notice. The employer has an ample pool of employees on call from which it can quickly obtain a replacement.
Section 13(5)(b)(i) prevents employers from making deductions from an employee's wages because of the employee's mistakes, even if the employee has authorized the deduction in writing. Without such protection, an employee could be charged by way of wage deduction for every item or piece of work spoiled or rejected. Employers who want to recover damages due to employees' faulty work may choose to sue for damages in court, but they cannot make deductions from the employees' wages. Referees in decisions under the former Employment Standards Act have held that no deduction could be made in the following circumstances on grounds that they constituted faulty work:
The Program has also taken the position that:
The Program also takes the position that the prohibition against wage deductions for faulty work in s. 13(5)(b)(i) applies not to just past or present faulty work, but to anticipated future faulty work as well. For example, employers are prohibited from making a wage deduction and putting the amount of the deduction towards an indemnity fund to pay for any damages or deductible owing due to the employee's anticipated future mistakes.
Further, the Program takes the position that the prohibition extends to prohibit deductions from one employee for the faulty work of another employee. For example, employers are prohibited from making wage deductions and putting the amount of the deduction towards an indemnity fund to pay for damages arising from any employee's faulty work.
Under s. 13(5)(b)(ii), an employer is prohibited from withholding wages, making a deduction from wages or requiring an employee to return wages for cash shortages, loss of property or stolen property where any person other than the employee had access to the cash or property, even if the employee has authorized the deduction in writing. This could include situations where a customer leaves a restaurant without paying the bill or where a customer leaves a gas station without paying the bill after pumping gas for their car. The dine and dash
or “gas and dash” can be considered a cash shortage and, in such cases, the customer, not the restaurant employee or gas station employee, had exclusive control over the cash in question.
If another employee had access to the cash register at the same time as a claimant, no withholding, deduction or return of wages can be made. Therefore, if another employee had access to the cash register at times other than the claimant's shift and only the claimant had access during their shift, a deduction can be made. As the referee in Fraser o/a Becker's Milk v Oliver (January 24, 1980), ESC 694 (Bigelow) explained, under the former Employment Standards Act, the phrase where a person other than the employee has access to the cash or property
should be interpreted to mean where a person other than the employee has access to the cash or property during the employee's tour of duty as custodian of the cash or property
. This intent has not changed under the ESA 2000.
Section 13(5)(b)(iii) prohibits an employer from withholding wages, making deductions from wages, or requiring wages to be returned even with the employee's written authorization under any conditions prescribed by regulations. At the time of writing, no regulations prescribing conditions had been made.
Under s. 13(5)(c), a written authorization from an employee purporting to authorize the return to the employee's employer wages that were the subject of an order to pay would not be valid.
This provision is similar in effect to s. 14 of the former Employment Standards Act. It should be noted that the Employment Standards Act, 2000 increased the maximum amount of wages that are given priority from $2,000 to $10,000 per employee.
Section 14(1) prevails over other provincial acts to the extent that they purport to grant a different level of priority for the employee wages, or to grant priority over wages to some competing claim.
For example, s. 3 of the Wages Act, RSO 1990, c W.1, states that wages have priority over the claims of other execution creditors to the extent of three months' wages per employee. Section 14 prevails over that provision. It is important to note that wages
under the Wages Act means wages or salary
in a strict sense, as opposed to the broader definition of wages
contained in s. 1 of the ESA 2000.
In matters of insolvency, s. 14(1) gives wages, as defined in s. 1, priority over all unsecured creditors of the employer (including the Crown) to the extent of $10,000 for each employee.
Section 14(1) does not give wages priority over the claims of secured creditors, such as trade creditors or suppliers. A secured creditor is one with an interest in the debtor’s property to secure payment or performance of an obligation. The instrument that creates the security may take the form of a debenture, mortgage, assignment of book debts or accounts receivable, or a general security agreement (GSA
). See Re Campeau Corporation and Provincial Bank of Canada et al., 1975 CanLII 429 (ON SC), where the court held that it was not the intention of the legislature, in enacting s. 14 of the former Employment Standards Act, to interfere with the rights of secured creditors. This intention has not changed under the ESA 2000.
Section 14(1) does not, by itself, create any lien or charge upon an employer’s assets as do the deemed trust
provisions for vacation pay contained in s. 40. The decision in Beecroft v. Watt (1986), 1 RFL 3(d) 231 (Ont Prov Ct), cited to support this principle, refers to ss. 14 and 15 of the former Employment Standards Act, the wording of which is very similar to s. 14(1) of the ESA 2000.
It should also be noted that because wages
under the ESA 2000 includes vacation pay, the amount of vacation pay deemed to be held in trust under s. 40(1) will be included in the $10,000 amount that is given priority under s. 14(1). However, the deemed trust status under s. 40(1) confers a greater priority over other creditors with respect to the vacation pay component of the $10,000 than the priority afforded under s. 14(1). See ESA Part XI, s. 40(1) for a discussion of the deemed trust under s. 40(1).
Section 14(2) states that the priority of wage claims provided in s. 14(1) over claims of other unsecured creditors of an employer does not apply to distributions made under federal bankruptcy and insolvency legislation.
Part V.1 prohibits employers from withholding their employees’ tips or other gratuities, making a deduction from their employees' tips or other gratuities, and causing their employees to return or give their tips or other gratuities to the employer, except in specified circumstances.
Part V.1 prohibits, an employer from withholding an employee’s tips or other gratuities, making a deduction from them, or causing the employee to return or to give them to the employer, with the following exceptions:
Where an employer contravenes this prohibition, the remedy is set out in s. 14.2(2): the employer must pay the amount that was unlawfully withheld/deducted/returned/given. This payment is to be made in favour of the employee(s) to whom the customer intended to give the tip. The amount owing is enforceable under the ESA as if it were wages owing to the employee(s).
To illustrate: s. 14.4 allows employers to withhold or make a deduction from an employee’s tips or other gratuities or cause the employee to return or give them to the employer if the employer collects and redistributes tips or other gratuities among some or all of its employees, subject to certain exceptions established under that subsection. Take an example where an employer has a tip pool policy that provides for a portion of waiters’ tips to be distributed to all kitchen staff. One night, the employer withheld a percentage of the waiters’ tips as per usual but only redistributed them to the cooks and kept the amount that otherwise would have gone to the dishwashing employees. Assuming this employer does not have the right to participate in the tip pool, the employer has contravened s. 14.2(1). The contravention does not stem from the fact the employer did not adhere to the terms of its tip pool. It stems from the fact that the employer, having withheld the waiters’ tips, did not redistribute some of them in accordance with s. 14.4. In this example, the employer did not have the right to participate in the tip pool and as such would have had to distribute all of the withheld tips to employees in order to fit itself within the s. 14.4 exception and avoid a contravention of s. 14.2(1). The remedy is as per s. 14.2(2): the amounts unlawfully withheld from each waiter (i.e. the amount the employer kept) is a debt owing to each waiter and the amounts owing are enforceable under the Act as if the debts were “wages”. The dishwashing employees do not have an enforceable claim under the ESA for any amounts they may have otherwise received if the tips were redistributed in accordance with the tip pool policy.
Employers are not required under the ESA to provide employees with written statements regarding tips or other gratuities.
This provision prohibits employers from withholding an employee's tips or other gratuities, making a deduction from employees' tips or other gratuities, or causing employees to return or to give their tips or other gratuities to the employer unless authorized to do so under Part V.1.
For the balance of this chapter, reference is generally made only to an employer withholding employees’ tips or other gratuities, but the discussion should be understood as also addressing an employer making a deduction from employees’ tips or other gratuities as well as an employer causing employees’ tips or other gratuities to be returned or to be given to the employer.
See s. 1(1) for the definition of the term “tips or other gratuities”.
The only circumstances in which an employer may withhold an employee’s tips or other gratuities as authorized under Part V.1 are:
Outside of these circumstances, employers are prohibited under the Act from withholding their employees’ tips or other gratuities. Among other things, this means that employers are prohibited from withholding their employees' tips or other gratuities for things such as breakage, spillage, losses or damage. Employees cannot provide written authorization or any other form of consent to have their tips or other gratuities withheld. (Note that, in this respect, the prohibition against withholding tips or other gratuities is different than the prohibition against deductions that applies to wages in s. 13 of the Act.)
The question may arise as to how much time the employer has to pay or redistribute the tips or other gratuities before it can be said that the employer has failed to do so and is therefore in contravention of s. 14.2. There is no requirement in the Act for employers to establish a recurring period and day for the distribution of tips or other gratuities to employees. It is Program policy that the employer has a reasonable period of time to distribute the tips. What is reasonable will depend on the circumstances and must be assessed on a case-by-case basis. For example, where an employee experiences a delay in getting their tips, the length of the delay and the reason for the delay are relevant factors in determining whether there has been a withholding of tips or other gratuities contrary to s. 14.2(1).
The Act does not set out the method(s) by which an employer must distribute tips or other gratuities to employees. However, the method used cannot result in a withholding of, or deduction from, tips or other gratuities in contravention of s. 14.2(1). For example, where the payment method mandated by the employer imposes limits on an employee’s ability to access their tips or other gratuities within a reasonable period of time, it’s Program Policy that this will constitute a withholding of those tips or other gratuities. Whether a payment method constitutes a withholding of, or a deduction from, tips or other gratuities will depend on all the circumstances and must be assessed on a case-by-case basis.
This provision states that where an employer contravenes s. 14.2(1) (i.e. by withholding an employees’ tips or other gratuities in circumstances other than the two that are permitted by s. 14.3 or s. 14.4), the amount of the unlawfully withheld tips or other gratuities is a debt owing to the employee(s) and is to be treated as if it were “wages” under the ESA for purposes of enforcement. Treating the debt in this context as if it were “wages” is necessary for enforcement purposes because tips or other gratuities are not “wages” as per the s. 1(1) definition of “wages”. Without this treatment, the tips or other gratuities owing to the employee would not enforceable under the ESA.
As stated above under “Scheme of Part V.1”, only the employee whose tips or other gratuities were withheld, deducted, returned or given has a remedy under the ESA (i.e e. the employee(s) to whom the customer made or left a tip). There is no remedy under the ESA for other employees who may be on the receiving end of a distribution of a tip pool and who, for example, do not receive tip redistribution in accordance with the tip pool.
Although tips or other gratuities are to be treated as if they were wages owing to the employee for the purposes of enforcement, they are not to be treated as wages for any other purposes under the ESA. Accordingly, an order to pay wages for tips or other gratuities owing to an employee will not attract vacation pay.
This provision allows employers to withhold or make a deduction from an employee’s tips or other gratuities or cause the employee to return or give them to the employer if a statute of Ontario or Canada or a court order authorizes it.
This provision must be read in conjunction with the exception in s.14.3(2), which states that this provision does not apply if the statute or order requires the employer to remit the withheld, deducted, returned or given tips or other gratuities to a third person and the employer fails to do so.
The most frequently encountered deductions authorized by statute are for income tax, Canada Pension Plan (CPP) contributions and employment insurance (EI) premiums. An Employment Standards Officer should check with the Canada Revenue Agency if an employee alleges that deductions made by the employer in purported compliance with income tax, CPP or EI legislation were not authorized.
This provision states that an employer may withhold or make a deduction from an employee's tips or other gratuities "if a . . . court order authorizes it." It is Program policy that a withholding or deduction is allowed under s.14.3(1) only if a court order explicitly authorizes it. It is not enough that the employer is in possession of a court judgment declaring that the employee owes a debt to his or her employer.
Section 14.3(2) provides that the authority in subsection (1) for an employer to withhold or make a deduction from an employee’s tips or other gratuities if a statute or court order authorizes it does not apply if the statute or court order requires the employer to remit the amounts to a third person and the employer fails to do so.
For example, an employer may make statutory deductions for income tax, CPP or EI but fail to remit the funds on the employee's behalf to the Canada Revenue Agency as required. 1), Where the employer fails to remit the deducted tips or other gratuities, the requirement in ss.14.3(2) is not met and the deduction is not permitted pursuant to ss.14.3(1). As such, the employer is in violation of s.14.2(1) since the deduction was not authorized under this Part. Per s.14.2(2) the amount deducted is a debt owing to the employee and is enforceable under the ESA as if it were wages owing to the employee.
Subsection 14.2(1) prohibits employers from withholding employees’ tips or other gratuities unless authorized to do so under Part V.1. This provision – s. 14.4(1) - authorizes employers to withhold employees’ tips or other gratuities if the employer collects and redistributes them among some or all of the employer’s employees. (This is commonly referred to as a “tip pool”.)
Tip pools include what is referred to as “tip outs”, which are payments made from a tip-earning employee to a non tip-earning employee pursuant to their employer's policy. For example, an employer's policy may require a waiter to “tip out” a certain percentage of the waiter’s tips or sales to the bartender who prepared drinks for the waiter.
This provision must be read in conjunction with subsections 14.4 (2) - (5), which place some restrictions on the ability of employers, directors and shareholders to participate in the redistribution under subsection 14.4(1).
See s. 14.2(1) for information about the timing of and methods of payment for the distribution of tips and other gratuities.
The criteria in this provision are not met unless “the employer collects and redistributes tips or other gratuities among some or all of the employer's employees”. This means, for example, that where the only person to share in the tip pool is the sole proprietor who owns the business, there will be a violation of s. 14.2(1) because the tips that were withheld were not redistributed among some or all of the sole proprietor's employees.
Other than the limitations on participation in the tip pool that are established in subsections 14.4 (2) - (5) for the purposes of determining whether the withholding of tips is authorized under subsection 14.4(1), the Act does not regulate tip pools. For example, the Act:
As of the publication date, no employees are prescribed.
Subject to s. 14.4(4) and (5), employers, or directors or shareholders of an employer, are prohibited from sharing in the proceeds of a tip pool redistribution.
However, the Act does not prohibit employers, or directors or shareholders of an employer from keeping any tips or other gratuities that they earn themselves (e.g., tips or other gratuities that a customer intended them to receive). For example, a director of a company that operates a bar often works as a bartender at the bar. The Act does not prohibit the director from keeping tips that were left by a customer in such circumstances that a reasonable person would be likely to infer were intended for the director.
"Regularly" implies that the performance of the work is routine and predictable.
"[T]o a substantial degree" implies that the performance of the work takes up a considerable amount of the sole proprietor or partner's time.
The issue of whether a sole proprietor or a partner in a partnership regularly performs to a substantial degree the same work is determined on a case-by-case basis considering all of the relevant factors, including how routinely they perform the work and the predictability of its performance.
For example, if a sole proprietor who works eight hours per day waited tables every day for five hours during the lunch rush and the dinner rush, the Program would take the position that the sole proprietor was regularly performing those duties to a substantial degree.
However, if a partner acted as a bartender only when there was an unexpected rush of customers or when an employee called in sick and if neither of those events were a regular occurrence, the performance of these duties may not be considered regular because they are performed on an irregular and unpredictable basis. Similarly, if a partner who works 10 hours per day acted as a bartender for one hour per shift, these duties may not be considered performed to a substantial degree.
A sole proprietor or partner may share in the tip pool if they regularly perform to a substantial degree the same work as some or all of their employees who share in the tip pool.
For example, if the employees who receive a portion of the tip pool are hosts, servers, cooks and dishwashers, a sole proprietor or partner could share in the tip pool if they regularly performed the duties of hosts, servers, cooks or dishwashers, or a combination thereof, to a substantial degree.
A sole proprietor or partner who does not regularly perform to a substantial degree the same work performed by some or all of the employees who share in the tip pool may nevertheless share in it if they regularly perform to a substantial degree the same work performed by employees of other employers in the same industry who commonly receive or share tips or other gratuities.
For example, a sole proprietor operates a restaurant in which the sole proprietor is the only bartender. Every day the sole proprietor spends six out of ten working hours bartending. The sole proprietor would be able to share in the tip pool because the sole proprietor regularly performs to a substantial degree the work of a bartender and bartenders in other restaurants commonly receive tips or share in the redistribution of tips or other gratuities.
Subsection 14.4(3) prohibits directors and shareholders of an employer from sharing in the proceeds of a redistribution of a tip pool, subject to the exception set out in this subsection.
This subsection provides that a director or shareholder of an employer may share in the proceeds of a redistribution of a tip pool if the director or shareholder regularly performs to a substantial degree the same work that is performed by:
"Regularly" implies that the performance of the work is routine and predictable.
"[T]o a substantial degree" implies that the performance of the work takes up a considerable amount of the director or shareholder's time. The issue of whether a director or a shareholder regularly performs to a substantial degree the same work is to be determined on a case-by-case basis considering all of the relevant factors, including how routinely they perform the work and the predictability of its performance.
For example, if a shareholder who works eight hours per day waited tables every day for five hours during the lunch rush and the dinner rush, the Program would take the position that the shareholder was regularly performing those duties to a substantial degree.
However, if a director acted as a bartender only when there was an unexpected rush of customers or when an employee called in sick and if neither of those events were a regular occurrence, the performance of these duties may not be considered regular because they are performed on an irregular and unpredictable basis. Similarly, if a director who works 10 hours per day acted as a bartender for one hour per shift, these duties may not be considered performed to a substantial degree.
A director or shareholder may share in redistribution of the tip pool if they regularly perform to a substantial degree the same work as some or all of their employees who are part of the tip pool.
For example, if the employees who receive a portion of the tip pool are hosts, servers, cooks and dishwashers, a director or shareholder could share in the tip pool if they regularly perform the duties of hosts, servers, cooks or dishwashers, or a combination thereof to a substantial degree.
A director or shareholder who does not regularly perform to a substantial degree the same work performed by some or all of the employees who share in the tip pool may nonetheless share in it if they regularly perform to a substantial degree the same work performed by employees of other employers in the same industry who commonly receive or share tips or other gratuities.
For example, a director works at a restaurant in which the director is the only bartender. Every day the director spends six of ten working hours bartending. The director would be able to share in the tip pool because the director is regularly performing to a substantial degree the work of a bartender and bartenders in other restaurants commonly receive tips or other gratuities.
Section 14.5 establishes transitional rules for situations where a collective agreement that was in effect when Part V.1 came into force contains provisions re: tips and other gratuities that conflict with Part V.1.
Part V.1 came into force on June 10, 2016.
This subsection states that a term of a collective agreement that was in force on June 10, 2016 that addresses the treatment of employee tips or other gratuities will prevail over Part V.1 if there is a conflict.
For example, if a collective agreement that was ratified in June 2013 and in force on June 10, 2016 contained a provision that required employees to give half of all tips earned to the employer for the employer to keep, that provision would prevail even though such an arrangement would otherwise be prohibited under Part V.1.
This subsection states that where a collective agreement described in subsection (1) expires but the collective agreement provision addressing the treatment of employee tips or other gratuities remains in effect, subsection (1) (which allows that collective agreement provision to prevail over Part V.1 if there is a conflict) continues to apply with necessary modifications until a new or renewal collective agreement comes into effect.
For example, a collective agreement was ratified in June 2013 and in force June 1, 2016 that contained a provision that required employees to give half of all tips earned to the employer for the employer to keep. The collective agreement expired on August 1, 2016 and the provisions that address the treatment of tips or other gratuities remained in effect until the new agreement came into effect on October 1, 2016. That provision prevailed over Part V.1 until October 1, 2016 even though such an arrangement would otherwise be prohibited under Part V.1.
This subsection provides that subsection (1), which allows provisions in a collective agreement that conflict with Part V.1 to prevail, does not apply to collective agreements made or renewed on or after June 10, 2016.
In other words, terms of collective agreements that came into effect on or after June 10, 2016 that address the treatment of employee tips or other gratuities must comply with Part V.1 of the Act.
Part VI of the Act (Records) imposes certain obligations on employers to create detailed records pertaining to the employment of each employee, and to retain those records over specified periods of time. These records may serve as evidence in the event of a complaint under the Act. The obligations with respect to keeping records of vacation time and pay in paragraph 6 of s. 15(1) and paragraph 5 of s. 15(5) of the Act were repealed and replaced by those set out in a new section (s. 15.1) by the Government Efficiency Act, 2002, SO 2002, c 18 (GEA 2002
) which came into force on November 26, 2002. In addition, the GEA 2002 amended the record-keeping obligations to add a requirement to keep records of the information provided in statements to employees upon the termination of employment in accordance with s. 12.1 (new).
Section 15(1) sets out the specific information that an employer is required to record and keep concerning the employment of each employee. This provision was amended by the Fair Workplaces, Better Jobs Act, 2017, SO 2017 c 22 amended this provision by adding new record keeping obligations in paragraphs 3.1 and 3.2.
The employer can choose their format for records, as the ESA 2000 does not provide specific formatting requirements. Instead, the ESA 2000 sets out what information must be captured and the time periods during which it must be maintained and kept readily available for inspection.
Accurate and complete records may provide evidence of compliance with other parts of the ESA 2000, although they are not necessarily conclusive. Where an employer has not made and kept complete records, the employment standards officer will be required to make a determination with respect to such issues as the employee's rate of pay and hours worked, etc., on the best evidence available.
In W.G. Wilson Transportation Inc. o/a Modern Cab v Aubertin (August 25, 1987), ESC 2259 (Aggarwal) Referee Aggarwal determined that where an employer fails to keep accurate records of hours worked by an employee, a record kept by the employee may provide the basis for calculating hours worked. The employer's argument that the employee's records are self-serving
should be disregarded.
The employer's obligations in s. 15(1) are clear and specific. They shall record the following information with respect to all employees, including homeworkers:
or
Note the ESA does not require employers to keep records regarding tips and other gratuities. Furthermore, because tips and other gratuities do not fall within the definition of wages, there is no obligation for an employer to include information regarding tips and other gratuities on wage statements.
This provision applies to employers of homeworkers. Under s. 15(2), an employer must maintain a register of any homeworker tthey employ. In addition to the requirements for records under s. 15(1), this register must contain the following information:
Section 15(3) relieves an employer from the requirement to record the dates and times the employee worked and all daily and weekly hours worked by employees who are paid a salary as defined in s. 15(4) if:
This provision defines salary
for the purposes of the record-keeping requirements of s. 15(3).
Where an employee receives a fixed payment for each pay period for services rendered to the employer, and where the payment does not vary by the number of hours the employee works (unless the hours are in excess of 44 hours per week), they are considered under s. 15(4) to be in receipt of a salary.
Section 15(4)(a) does not mean, however, that the pay per pay period can never change. For example, an employee would still be deemed to be a salaried
employee where the employee receives a raise resulting from a change to the employment contract. In other words, an employee will be considered to be paid a salary, even though the salary may change, provided the change is long term rather than a consequence of a weekly fluctuation in hours worked.
Under s. 15(5), an employer must retain records or arrange for another person to retain them for stipulated three-year periods. Note that the retention periods with respect to vacation time and pay records is five years and are set out in s. 15.1.
It should also be noted that it is the responsibility of the employer to record and retain information for record-keeping purposes. Where an employer makes an arrangement for another person, such as a bookkeeper or accountant, to retain the records, the employer's responsibility to create the records is not removed. Further, an employer must also ensure that the records are readily available for inspection by an employment standards officer even where another person retains them – see the discussion at ESA Part VI, s. 16.
A manager's claim for wages cannot be disallowed simply because one of his duties was to properly complete records, including his own. In 634429 Ontario Limited c.o.b.a. Great Scott's Restaurant v Mayo et al (January 2, 1987), ESC 2204 (Bryant), a decision under the former Employment Standards Act, Referee Bryant stated Under section 11 of the ... Act the employer is responsible for maintaining accurate records relating to the employee's performance of work.
See also Village of West Lorne v Orchard (February 15, 1985), ESC 1787 (Brown).
Employment standards officers should note that any information they give to an employer regarding the retention periods of records must be limited to the requirements of the ESA 2000. Some records may be required by other legislation, either federal or provincial, (e.g., the federal Income Tax Act) for longer time periods.
Occasionally, enquiries are received as to whether the Program or Director of Employment Standards will authorize the destruction of records after the stipulated three-year periods. The response should be that the ESA 2000 requires records to be maintained for certain periods and is not contravened if records are not kept beyond the expiry of those time periods. The ESA 2000, however, does not empower the Director to authorize the destruction of records.
This provision permits an employer to remove information concerning the employment of a homeworker in their employ, from the register, three years after the homeworker's employment has ended.
This provision was amended effective March 19, 2020 as a result of the Employment Standards Amendment Act (Infectious Disease Emergencies), 2020 to include a reference to infectious disease emergency leave.
It was previously amended effective January 1, 2019 as a result of the Making Ontario Open for Business Act, 2018 to reflect new Part XIV Leaves of Absence that replaced personal emergency leave – sick leave, family responsibility leave and bereavement leave.
Section 15(7) requires an employer to retain (or arrange for some other person to retain) all notices, certificates, correspondence and other documents relating to any leave taken by an employee under ESA Part XIV Leaves of Absence. The documents must be retained for a period of three years after the end of the leave. The employer must also ensure that these documents are readily available for inspection by an employment standards officer, upon request, in keeping with ESA Part VI, s. 16.
The documents that must be retained include the following:
Section 15(8) requires employers to retain copies of agreements to work excess daily or weekly hours for three years after the last day on which work was performed under the agreement. The employer must retain or arrange for another person to retain these records. The employer must also ensure that the copies are readily available for inspection by an employment standards officer, upon request, in keeping with the requirements of ESA Part VI, s. 16.
Subsection 15(8.1) was added to the ESA effective December 2, 2021. This provision requires employers to retain copies of every written policy on disconnecting from work required under Part VII.0.1 for three years after the policy ceases to be in effect. The employer must retain or arrange for another person to retain these records. The employer must also ensure that the copies are readily available for inspection by an employment standards officer, upon request, in keeping with the requirements of ESA Part VI, s. 16.
Subsection 15(8.2) was added to the ESA effective April 11, 2022, at the same time that the requirement to have a written policy in place with respect to electronic monitoring of employees was added to the ESA. This provision requires employers to retain copies of every written policy on electronic monitoring required under Part XI.1 for three years after the policy ceases to be in effect. The employer must retain or arrange for another person to retain these records. The employer must also ensure that the copies are readily available for inspection by an employment standards officer, upon request, in keeping with the requirements of ESA Part VI, s. 16.
Section 15(9) requires employers to retain copies of agreements to average hours of work that were made under ESA Part VIII, s. 22(2)(a) for the purpose of calculating overtime pay entitlements for three years after the last day on which work was performed under the agreement. The employer must retain or arrange for another person to retain these records. The employer must also ensure that the copies are readily available for inspection by an employment standards officer, upon request, in keeping with the requirements of ESA Part VI, s. 16.
The Fair Workplaces, Better Jobs Act, 2017, SO 2017 c 22, effective January 1, 2018, amended this provision to add record keeping obligations with respect to the vacation pay earned in each vacation entitlement period. Section 15.1 should be read together with ESA Part XI, s. 41.1, which sets out employees' rights to a statement of the information recorded under this section.
Section 15.1(2) sets out the record keeping requirements for both vacation time and pay with respect to each completed vacation entitlement year as follows:
15.1(3) If the employer establishes an alternative vacation entitlement year for an employee, the employer shall record the following information for the stub period:
Section 15.1(3) establishes the recordkeeping obligations with respect to vacation time and pay earned and taken in a stub period as follows:
Section 15.1 (4) requires the employer to make a record of the information regarding vacation time and pay for each vacation entitlement year and stub period no later than seven days after the completion of the vacation entitlement year or stub period, or the first pay day following the completion of the vacation entitlement year or stub period, whichever is later.
Similar to the record retention obligations established under s. 15(5), it is the employer's responsibility to retain the information recorded under s. 15.1. The Fair Workplaces, Better Jobs Act, 2017, SO 2017 c 22, effective January 1, 2018, amended this provision to increase the record retention period for records made under this section from three years to five years after they are made. The records may be retained by either the employer or some other person as arranged by the employer.
Note that if the employer does arrange for some other person to retain the records, this does not relieve the employer of the requirement to create the records.
Section 15.1(6) exempts employers from the obligation to record vacation pay paid during the vacation entitlement year and stub period, the amount of wages on which vacation pay were calculated and the period to which those wages relate, if the employer pays vacation pay in accordance with ESA Part XI, s. 36(3) (as amended). Under s. 36(3) an employer and employee may agree that the vacation pay that accrues over each pay period will be paid on the pay day for that pay period. In that case, the employer is required to provide the employee with a statement of the vacation pay paid either as part of the statement of wages provided under ESA Part V, s. 12(1), as per s. 36(3)(a), or separately as per s. 36(3)(b).
However, s. 15(1), paragraph 5 states that the employer is required to record the information provided to the employee in a statement given to the employee under s. 12(1) or s. 36(3)(b). An employer pays vacation pay in accordance with s. 36(3) if the statement of wages provided under s. 12(1) includes the amount of vacation pay paid or the employer provides a separate statement of vacation pay as per s. 36(3)(b).
As a result, where the employer pays vacation pay in accordance with s. 36(3), the employer is relieved by s. 15.1(6) of the requirement to make a record with respect to vacation pay paid and the wages on which it was calculated and the period to which those wages relate for a vacation entitlement year or stub period, but the employer must still record the vacation pay information provided on each pay day for each pay period either as part of the s. 12(1) statement of wages or on a separate statement as per s. 36(3)(b) in accordance with paragraph 5 of s. 15(1).
The Fair Workplaces, Better Jobs Act, 2017 SO 2017, c 22 added this provision, effective January 1, 2018. Section 15.1(7) is the transitional provision for the application of the new record keeping obligations for vacation pay earned during a vacation entitlement year in para 4.1 of s. 15.1(2) and the vacation pay earned during a stub period in para 3.1 of s. 15.1(3).
It provides that these new record keeping obligations do not apply to any vacation entitlement year or stub period that began before January 1, 2018.
Section 16 is intended to prevent unnecessary delays in the production of an employer's records during an investigation under the Act. An employer is expected to produce records made under ss. 15 and 15.1 promptly upon request by an employment standards officer, whether the employer is in possession of the records, or has arranged for another person to retain them.
Where an employer has arranged for another person to retain the records at a location other than the workplace, it remains the employer's responsibility to produce them, within a reasonable period of time, upon the request of an employment standards officer.
2XNSZRHZMVM4-84339534-95668 797bb738-2cfe-40ca-b64a-4e0bad1b1d0d https://ontariogov.sharepoint.com/sites/MOL-DW/comms/_layouts/15/DocIdRedir.aspx?ID=2XNSZRHZMVM4-84339534-95668, 2XNSZRHZMVM4-84339534-95668The original limits on working hours of women and children and youths created in 1884 were motivated by health and safety concerns. Although the 1944 legislation retained the health and safety emphasis, a greater emphasis was placed on job creation and the desire to spread work as the armed forces returned to the civilian labour force. The hours of work provisions in the Employment Standards Act, 2000 allow workplace parties, with some Ministry oversight, to arrange work schedules to suit their needs. The amendments that came into force on March 1, 2005 contain measures that increase employee and employer awareness of their hours of work rights and obligations. Provisions that ensure that employees receive hours free from work in between shifts and on a daily and weekly or bi-weekly basis continue to apply.
Section 17(1) sets out the daily and weekly maximum hours that an employer may require or allow an employee to work:
This provision allows employees to refuse to work hours in excess of eight per day, or in excess of the number of hours in a longer established regular work day, and 48 hours in a work week.
The limits on hours of work in s. 17(1) are subject to the following exceptions:
Note also that the limit on daily hours of work contained in s. 17(1)(a) does not apply to certain employees hired before September 4, 2001, who entered into arrangements to work hours in excess of those in their regular work day. See O Reg 285/01, s. 32.1.
The daily maximum number of hours of work an employer can require or allow an employee to work is eight or, if the employer establishes a regular work day of more than eight hours for the employee, the number of hours in theirregular work day.
While the Employment Standards Act, 2000 does not explicitly set out the maximum number of hours a regular work day can be, the ability to establish a regular work day longer than eight hours remains subject to the weekly hours of work limit in s. 17(1)(b), as well as the requirement for daily rest contained in ESA Part VII, s. 18.
Regular work day
is defined in ESA Part I, s. 1(1) to mean with respect to an employee who usually works the same number of hours each day, means a day of that many hours
. Because the word usually
is used, an employee does not have to work the same number of hours every work day to establish a regular work day. A regular work day can be established so long as an employee ordinarily works a set number of hours.
An employer may establish a schedule where employees work different numbers of hours on different days of the week. For example, employees work 10 hours Mondays to Thursdays and eight hours on Fridays. It is Program policy that the regular work day from Monday to Thursday is 10 hours and eight hours on Friday. Note that the employer will have to pay overtime pay for four hours in this example (assuming the employee has a 44-hour overtime threshold).
The Act does not prohibit an employer from adjusting the regular work day on occasion. That is, so far as the Act is concerned, the employer may establish a different regular work day than what it had previously established.
For example, consider an employer that has the following schedule:
The employer wishes to establish the following amended schedule:
The Act does not prohibit the employer from establishing a new regular work day of 11 hours for Mondays and Tuesdays.
Furthermore, the employer may want to return to the original schedule after, for example, several months. Nothing in the Act prohibits this further change to the schedule.
However, the definition of regular work day contemplates that the employee usually works a specific number of hours on a particular day. The more frequently the employer changes the schedule in relation to a particular day of the week, the less likely it is that the employee could be said to have a usual number of hours on a particular day of the week. In other words, the facts may reveal that there is no regular work day, in which case the daily limit in s. 17(1)(a) for that employee will be eight – subject to the exceptions to this limit set out in s. 17(2) and s. 19.
Note also that while the Act does not prohibit the employer from changing the regular work day, there may be restrictions against doing so in an employee’s employment contract. In this case, it may amount to a breach of the employment contract for the employer to change the regular work day, which may give rise to a constructive dismissal under the Act or at common law.
ESA Part I, s. 1 defines work week
as:
In ascertaining the recurring period of seven consecutive days established by the employer for the purpose of scheduling work, if any, an employment standards officer may consider such information as work schedules, time cards and pay periods, although these are not necessarily the same as the work week. In the absence of the employer having established a recurring period of seven consecutive days for the purpose of scheduling work, a default work week of Sunday to Saturday will apply.
O Reg 285/01, s. 1.1 sets out the circumstances in which work is deemed to be performed or not deemed to be performed. This provision is essential in determining the number of hours of work under this Part. Note that O Reg 285/01, s. 22 sets out special rules regarding when work is not deemed to be performed for residential care workers.
O Reg 285/01, s. 1.1 provides as follows:
See the detailed discussion of these provisions in O. Reg. 285/01, s. 1.1.
Section 17(2) permits employers and employees to agree, in writing that the employee will work up to a specified number of hours in excess of the daily limit set out in s. 17(1)(a) – see ESA Part 1, s. 1(3) and s. 1(3.1) for a discussion of agreements in writing
Section 17(2) must be read in conjunction with s. 17(5), which provides that s. 17(2) agreements are not valid unless:
and
In addition, the agreement must clearly set out what is being agreed upon. It must be written with sufficient clarity for the parties to know precisely what they are agreeing to. If one of the parties drafted the agreement, and a particular term is ambiguous and the parties disagree about what the term means, the term will be construed against the parties who drafted the agreement - this is called the contra proferentem rule. The parties must have entered into the agreement voluntarily. Please see ESA Part I, s. 1(3) for a more detailed discussion of the issue of voluntary consent.
Agreements to work excess daily hours can specify the exact number of hours that the employee is agreeing to work, the exact number of hours over and above the daily limit, or they can specify an upper limit (e.g., up to 10 hours a day
).
This section contemplates both one-off
agreements, where the employee agrees in writing to work excess daily hours on a single occasion, and more open-ended as required
agreements, where the employee agrees in writing to work a specified number of excess daily hours whenever required by the employer. For example, a retail employer preparing for the busy Christmas season may ask an employee to agree to with two days' notice, work up to 12 hours a day during the months of November and December of this year.
Agreements under s. 17(2) to work excess daily hours and agreements under s. 17(3) to work excess weekly hours are two separate agreements, although they can be embodied in the same document.
Note that there may be some circumstances in which what appears to be a single agreement with respect to excess daily hours by necessary implication includes an agreement with respect to excess weekly hours, and vice versa. For example, an employee regularly works nine hours a day, five days a week. On the fifth day of the week, the employee agrees in writing to exceed the daily limit and work four additional hours. By necessary implication, the employee has also agreed to work in excess of 48 hours in that work week, and the employee will be permitted to work those excess hours. Or the same employee, who regularly works nine hours a day, whose employer operates only five days a week, enters into an agreement to work up to 60 hours per work week when required – in these circumstances, the employee, by necessary implication, has also agreed to work excess daily hours.
In attempting to facilitate opportunities to work excess hours, employers have inquired as to whether a signature on a sign-up sheet for additional hours might be considered a valid written agreement under s. 17(2). The Program’s view is that such a document would be valid if all of the following conditions are met:
The requirement regarding the Director’s information document in s. 17(5) does not apply to employees who are represented by a trade union — see s. 17(9)(b). Furthermore, different rules regarding the Director’s information document apply to employers who entered into agreements with employees to work excess daily hours under the provisions of the ESA 2000 before March 1, 2005, the date on which the amendments made by the Employment Standards Amendment Act (Hours of Work and Other Matters), 2004, SO 2004, c 21came into force. In particular, because the agreements were entered into under a scheme when the requirement of s. 17(5) was not in force, the conditions for a valid agreement in s. 17(5) do not apply to such employers. See ss. 17(9). Pursuant to a now-repealed provision – ss. 17(10) – the employer was required to provide the information document to employees by June 1, 2005.
In the absence of a valid written agreement, the daily limit on hours of work in s. 17(1)(a) applies, and the employer may not require or even permit an employee to work excess daily hours, unless exceptional circumstances within the meaning of ESA Part VII, s. 19 are present.
Agreements to work excess daily hours can generally be revoked by employees with two weeks' written notice and generally with reasonable notice by employers — see ss. 17(6) and (7), respectively. It is, however, the Program’s position that in situations where an agreement to work excess hours is made pursuant to a collective agreement, the ability to revoke the agreement to work excess hours must be made in accordance with the terms of the collective agreement and the Labour Relations Act, 1995, SO 1995, c 1, Sch A,where applicable. Generally, this means that unilateral revocation is not possible during the operation of the collective agreement.
Employers are required to retain a copy of every excess daily (and weekly) hours agreement it has made with its employees for three years after the last day on which work was performed under each agreement — see ESA Part VI, s. 15(8).
Subsection 17(3) was amended effective April 3, 2019 by the Restoring Ontario’s Competitiveness Act, 2019 (ROCA). The ROCA removed the previous requirement to obtain approval of the Director of Employment Standards to exceed the limit on weekly hours of work.
Section 17(3) permits employees’ hours of work to exceed the weekly limit of 48 hours in a work week if the employee enters into an agreement with the employer providing that he or she will work up to a specified number of hours in a work week, and the employees’ hours of work do not exceed the number of hours specified in the agreement. The agreement must be in writing to be valid — see ESA Part I, s. 1(3) and (3.1) for a discussion of agreements in writing.
In a non-unionized workplace, each employee has the right on an individual basis to enter into agreements to work excess weekly hours. For employees represented by a trade union, the written agreement may be embodied in the collective agreement, a memorandum of agreement or an addendum to an agreement. All bargaining unit members are bound by such an agreement. In this regard, see the discussion of ESA Part III, s. 7.
This section must be read in conjunction with s. 17(5), which provides that s. 17(3) agreements are not valid unless:
and
In addition, the agreement must clearly set out what is being agreed upon. It must be written with sufficient clarity for the parties to know precisely what they are agreeing to. The parties must have entered into the agreement voluntarily. Please see ESA Part I, s. 1(3) for a more detailed discussion of the issue of voluntary consent.
Agreements to work excess weekly hours can specify the exact number of hours that the employee is agreeing to work, the exact number of hours over and above the weekly limit, or they can specify an upper limit (e.g., up to 60 hours a week
).
This section contemplates both one-off
agreements, where the employee agrees in writing to work excess weekly hours on a single occasion, and more open-ended as required
agreements, where the employee agrees in writing to work a specified number of excess weekly hours whenever required by the employer. For example, a retail employer preparing for the busy Christmas season may ask an employee to agree to with two days' notice, work up to 60 hours a week during the months of November and December of this year.
Agreements under s. 17(2) to work excess daily hours and agreements under s. 17(3) to work excess weekly hours are two separate agreements, although they can be embodied in the same document.
Note that there may be some circumstances in which what appears to be a single agreement with respect to excess daily hours by necessary implication includes an agreement with respect to excess weekly hours, and vice versa. For example, an employee regularly works nine hours a day, five days a week. On the fifth day of the week, the employee agrees in writing to exceed the daily limit and work four additional hours. By necessary implication, the employee has also agreed to work in excess of 48 hours in that work week, and the employee will be permitted to work those excess hours. Or if the same employee, who regularly works nine hours a day and whose employer operates only five days a week, enters into an agreement to work up to 60 hours per work week when required, that employee by necessary implication, has also agreed to work excess daily hours.
In attempting to facilitate opportunities to work excess hours, employers have inquired as to whether a signature on a sign-up sheet for additional hours might be considered a valid written agreement under s. 17(3). The Program’s view is that such a document would be valid if all of the following conditions are met:
The requirement regarding the Director’s information document in s. 17(5) does not apply to employees who are represented by a trade union — see s. 17(9)(b). Furthermore, different rules regarding the Director’s information document apply to employers who entered into agreements with employees to work excess weekly hours before March 1, 2005, the date the amendments to the ESA 2000 requiring that the Director’s information document be given to employees came into force — see s. 17(9).
In the absence of a valid written agreement, the weekly limit on hours of work in s. 17(1)(b) applies, and the employer may not require or even permit an employee to work excess weekly hours unless exceptional circumstances within the meaning of s. 19 are present.
Agreements to work excess weekly hours can generally be revoked by employees with two weeks' written notice — see s. 17(6). Agreements to work excess weekly hours can generally be revoked by employers with reasonable notice — see s. 17(7).
The general right to revoke agreements is limited where the agreement is made between a union and the employer. It is the Program’s position that in situations where an agreement to work excess hours is made pursuant to a collective agreement, the ability to revoke the agreement to work excess hours must be made in accordance with the terms of the collective agreement and the Labour Relations Act, 1995 where applicable. Generally, this means that unilateral revocation is not possible during the operation of the collective agreement.
Employers are required to retain a copy of every excess weekly and daily hours agreement it has made with its employees for three years after the last day on which work was performed under each agreement — see ESA Part VI, s. 15(8).
Effective April 3, 2019, the excess weekly hours scheme was changed as a result of the Restoring Ontario’s Competitiveness Act, 2019 (ROCA). Prior to the ROCA amendments, the weekly maximum of 48 hours could be exceeded only if there was a written agreement between the employee and employer and the employer had received the approval of the Director of Employment Standards (or, pursuant to a limited exception, in situations where Director approval was pending and certain conditions were met).
As of April 3, 2019, the Director’s approval is no longer necessary; excess weekly hours can be worked if the employee and employer entered into a valid written agreement to exceed the limit on weekly hours of work and meet the other required conditions.
One question that might arise is what effect the ROCA amendments had on Director’s approvals that were issued pre-ROCA with a post-ROCA expiry date that were in force on April 3, 2019. As of April 3, 2019, the Director’s approval ceased to have any effect and the valid written agreement between the employer and the employee became determinative of the arrangement.
There may be circumstances where the terms of the agreement between the employee and the employer differ from those that were contained in the Director approval. For example, take the situation of an employee and employer who entered into a written agreement stating that the employee would work up to 65 hours per week but, the Director of Employment Standards provided an approval only for up to 60 hours per week. Prior to April 3, 2019, the employee would have been permitted to work no more than 60 hours per week. On April 3, 2019, the day the ROCA received Royal Assent, the Director’s approval ceased to have any effect and the agreement between the parties is what determines the arrangement. As such, the employee in this example would be permitted to work up to 65 hours per week as of April 3, 2019. (Note, of course, that there must continue to be compliance with all hours of work requirements, including those for daily and weekly rest contained in Part VII of the Act.)
Note also that employees may revoke a written agreement to work excess weekly (or daily) hours by providing two weeks’ written notice to the employer. The employer may revoke such agreements by giving reasonable notice to the employee. See ss. 17(6) and (7) for more information.
Section 17(5) provides that an employee’s agreement to work excess daily hours or excess weekly hours is not valid unless two conditions are met. These are intended to ensure and provide assurance to the Ministry that employees know their rights before signing agreements to work excess hours. Note that the conditions are in addition to the general requirements regarding agreements, i.e., that they be in writing, pursuant to ESA Part 1, s. 1(3) and s. 1(3.1) , and that they meet the requirements regarding issues such as voluntariness and specificity.
The two conditions are that an employee’s agreement to work excess daily hours pursuant to s. 17(2) or excess weekly hours pursuant to s. 17(3) is not valid unless:
and
These two conditions do not apply to employees who are represented by a trade union — see s. 17(9)(b) below.
Different rules regarding the Director’s information document apply to employers who entered into agreements with employees to work excess weekly hours under the ESA 2000 as it stood before the amendments made by the Employment Standards Amendment Act (Hours of Work and Other Matters), 2004 came into force on March 1, 2005. Because these agreements were entered into before s. 17(5) was in force, the conditions in s. 17(5) do not apply to such employers. See ss. 17(9). However, employers who had such agreements were required by now-repealed ss. 17(10) to provide the information document to employees by June 1, 2005.
If either of the conditions in s. 17(5) are not met, the agreement to work excess daily or weekly hours is not valid. And because a valid written agreement is required in order for an employer to require or even permit an employee to work excess hours, if either condition is not met, the employer will be in violation of the Act if any excess hours are worked (unless, of course, exceptional circumstances
within the meaning of s. 19 are present).
Agreements under s. 17(2) to work excess daily hours and agreements under s. 17(3) to work excess weekly hours are two separate agreements, although they can be contained within the same document. If they are in the same document and the conditions in s. 17(5) are not met, both agreements are invalid, and the employee cannot be required or permitted to work either excess daily hours or excess weekly hours. If the agreements are separate, both agreements must contain the statement described in s. 17(5)(b). If, for example, only the excess daily hours agreement contains the statement, then the excess weekly hours agreement will not be valid.
The Director’s information document needs to be provided only once, even if the excess daily hours agreement and the excess weekly hours agreement are made at different times, provided that the Director did not publish a revised information document after the earlier agreement was made but before the later agreement was made.
An employer gives the most recent Director’s information document to an employee on May 1, 2017, and the employee provides a written agreement to work excess daily hours on May 2, 2017. The agreement states that the employee was told by the employer that the information document she was provided with is the most recent one published. One month later, the employer asks the employee if she would be willing to work excess weekly hours and she indicates that she would. No revised information document has been published, and the employer tells the employee that the document provided to her on May 1, 2017 is still the most recent document published by the Director. The employee then provides a written agreement to work excess weekly hours; it states that the employee has been given an information document that the employer told her was the most recent one published. Since there was no new information document published between May 1, 2017 and the making of the excess weekly hours agreement one month later, and the agreement contains an acknowledgement that the employee has received what the employer has represented is the most recent document, the condition in s. 17(5)(b) is met.
As mentioned above, the two conditions contained in s. 17(5) are in addition to the other requirements regarding agreements. One of these requirements is there must be informed consent by the employee. There may be circumstances where, despite the conditions in s. 17(5) being met, there is not informed consent. For example, if the employee cannot read or understand the information document, was not given an explanation, and was not otherwise aware of his or her rights, then even though the conditions of s. 17(5) have been met, the agreement will not be valid because the element of informed consent is absent. Accordingly, the employee will not be permitted to work the excess hours.
This section requires that an employee provide an employer with at least two weeks' written notice before withdrawing from an agreement made under s. 17(2) to work excess daily hours or from an agreement made under s. 17(3) to work excess weekly hours. Note that special rules on revocability apply to agreements to work excess daily hours under O Reg 285/01, s. 32 and arrangements regarding daily hours under O Reg 285/01, s. 32.1.
The employee must give the notice in writing; verbal notice will not meet the requirement of this section. Note that where the agreement has been made by the union on behalf of the employee, that the employee has no individual right to revoke the agreement. See the discussion at section 7.
Further, it is the Program’s position that in situations where an agreement to work excess hours is made pursuant to a collective agreement, the ability to revoke the agreement to work excess hours must be made in accordance with the terms of the collective agreement and the Labour Relations Act, 1995 where applicable. Generally, this means that unilateral revocation is not possible during the operation of the collective agreement.
Where employees are able to revoke an agreement and provide the employer with the proper notice, the hours of work limits in s. 17(1) will again apply once the two-week notice period to revoke the agreement to work excess hours has expired, and the employer will no longer be able to require or permit an employee to work beyond those limits, subject to exceptional circumstances as set out in ESA Part VII, s. 19.
Section 32 of O Reg 285/01, s. 32 provides:
ESA Part XXVII, ss. 141(9) and (10) provide:
Together these sections provide that despite s. 17(6), employees who were hired on or after September 4, 2001, and who agreed in writing at the time of hiring to work hours in excess of the daily maximum cannot unilaterally withdraw from the agreement, even with two weeks' notice, if the Director of Employment Standards approved the agreement. The agreement can be revoked only if the employer and employee both agree, in writing, to revoke it.
Note that this exception to the revocability of agreements applies only to agreements to work excess daily hours. These employees retain the right under s. 17(6) to revoke, with two weeks' written notice, agreements to work excess weekly hours.
Note also that employees who are party to these approved agreements to work excess daily hours cannot be required to work more than 10 hours a day except in exceptional circumstances as set out in ESA Part VII, s. 19 — see ESA Part XXVII s. 141(9).
This section requires an employer to provide an employee with reasonable notice if it wishes to withdraw from an agreement regarding excess daily hours made under s. 17(2) or from an agreement regarding excess weekly hours made under s.17(3). Note that agreements under O Reg 285/01, s. 32 and arrangements under O Reg 285/01, s. 32.1 can be revoked only if both the employer and employee wish to revoke them.
The notice is not required to be in writing. Unlike the notice requirement in s. 17(6), verbal notice will suffice, although employers may wish to put the notice in writing in order to avoid misunderstandings.
Whether the notice provided by an employer is reasonable will depend upon the circumstances of each case. The Program does not view reasonable notice in the context of revoking an excess hours agreement under the ESA 2000 to be the same as reasonable notice as that term is used in the context of notice of termination under the common law, and, as such, the principles applied at common law are not necessarily applicable here.
Factors for consideration when determining whether the length of notice is reasonable may include:
It is the Program’s position that in situations where an agreement to work excess hours is made pursuant to a collective agreement, the ability to revoke the agreement to work excess hours must be made in accordance with the terms of the collective agreement and the Labour Relations Act, 1995 where applicable. Generally, this means that unilateral revocation is not possible during the operation of the collective agreement.
Once an excess hours agreement is revoked, the hours of work limits in s. 17(1) will once again apply, and the employer will no longer be able to require or permit an employee to work beyond those limits, subject to exceptional circumstances as set out in ESA Part VII, s. 19.
It is the Program’s view that an agreement to work excess hours under s. 17(2) or s. 17(3) does not require an employer to provide employees with excess hours; it only allows for excess hours be worked, permitting an employer to require an employee to work any excess hours the employer chooses to provide. An agreement under s. 17(2) or s. 17(3) is in no way a guarantee of wages and there is no basis for a claim by an employee of a violation of the Act (e.g., insufficient notice of a constructive dismissal) if excess hours are not provided.
Section 17(8) is a transitional provision relating to amendments that were made to the hours of work provisions effective March 1, 2005.
This provision establishes how agreements to work excess hours that were entered into under the provisions of the ESA 2000 before the amendments made by the Employment Standards Amendment Act (Hours of Work and Other Matters), 2004 came into force on March 1, 2005 are to be treated.
On February 28, 2005, the relevant provisions read as follows:
Section 17 of the ESA 2000:
Section 31 of O Reg 285/01:
Accordingly:
While the agreements that were entered into under the authority of s. 17(2) and O Reg 285/01, s. 31 as they read on February 28, 2005 (old agreements
) are treated as if they are agreements made under the current s. 17 (new agreements
), thereby negating the need for employers to enter into another agreement with employees when the amendments to the Act came into force, the rules regarding the Director's information document are different. See the discussion of ss. 17(9) below, and note that now-repealed ss. 17(10) required employers who were party to such an agreement to provide the information document to employees by June 1, 2005. Otherwise, agreements entered into pre- or post- March 1, 2005 were treated the same. Prior to the Restoring Ontario’s Competitiveness Act, 2019 (ROCA) amendments, all employers who had agreements with employees (regardless of the date the agreement was entered into) had to seek approval from the Director before the employee could work more than 48 hours per work week.
For information on transitions with regards to excess weekly hour agreements and Director approvals in place on April 3, 2019 when the ROCA amendments to the ESA came into force, please see the discussion at s. 17(3)
This section sets out two exceptions to the application of s. 17(5). Section 17(5) provides that agreements to work excess daily or weekly hours are not valid unless:
and
See above for a discussion of s. 17(5).
Section 17(9) provides that the s. 17(5) requirement does not apply to:
The agreements described in s. 17(8) are those agreements that were entered into under the provisions of the Act before the amendments made by the Employment Standards Amendment Act (Hours of Work and Other Matters), 2004 came into force on March 1, 2005. Because the agreements were entered into at a time when the requirement of s. 17(5) was not in force, the conditions for a valid agreement in s. 17(5) do not apply.
Note however that now-repealed s. 17(10) required employers who were party to an agreement described in s. 17(8) to provide the information document to employees by June 1, 2005.
The two conditions for a valid agreement that are set out in s. 17(5) do not apply to agreements made in respect of employees who are represented by a trade union.
The Restoring Ontario’s Competitiveness Act, 2019 (ROCA) amended the excess weekly hours scheme effective April 3, 2019 by removing the requirement for the Director’s approval of agreements to exceed the limit on weekly hours of work. The provisions that are currently in force are discussed in the section above. The text below, which appears in red, is the legislative text and the associated operational policy as it applied prior to April 3, 2019. This discussion is being maintained in this publication since employees may still file a complaint relating to a situation that arose when the below provisions were in force. The text appears in red to highlight that the below sets out the pre-April 3, 2019 language of sections 17, 17.1, 17.2 and 17.3 and is not current as of April 3, 2019.
Section 17(1) sets out the daily and weekly maximum hours that an employer may require or allow an employee to work:
This provision allows employees to refuse to work hours in excess of eight per day, or in excess of the number of hours in a longer established regular work day, and 48 hours in a work week.
The limits on hours of work in s. 17(1) are subject to the following exceptions:
Note also that the limit on daily hours of work contained in s. 17(1)(a) does not apply to certain employees hired before September 4, 2001, who entered into arrangements to work hours in excess of those in their regular work day. See O Reg 285/01, s. 32.1 for a discussion of the details of this exemption.
The daily maximum number of hours of work an employer can require or allow an employee to work is eight or, if the employer establishes a regular work day of more than eight hours for the employee, the number of hours in theirregular work day.
Employers can establish a regular work day in excess of eight hours without the approval of the Director of Employment Standards. While the Employment Standards Act, 2000 does not explicitly set out the maximum number of hours a regular work day can be, the ability to establish a regular work day longer than eight hours remains subject to the weekly hours of work limit in s. 17(1)(b), as well as the requirement for daily rest contained in ESA Part VII, s. 18.
Regular work day
is defined in ESA Part I, s. 1(1) to mean with respect to an employee who usually works the same number of hours each day, means a day of that many hours
. Because the word usually
is used, an employee does not have to work the same number of hours every work day to establish a regular work day. A regular work day can be established so long as an employee ordinarily works a set number of hours.
An employer may establish a schedule where employees work different numbers of hours on different days of the week. For example, employees work 10 hours Mondays to Thursdays and eight hours on Fridays. It is Program policy that the regular work day from Monday to Thursday is 10 hours and eight hours on Friday. Note that the employer will have to pay overtime pay for four hours in this example.
The Act does not prohibit an employer from adjusting the regular work day on occasion. That is, so far as the Act is concerned, the employer may establish a different regular work day than what it had previously established.
For example, consider an employer that has the following schedule:
The employer wishes to establish the following amended schedule:
The Act does not prohibit the employer from establishing a new regular work day of 11 hours for Mondays and Tuesdays.
Furthermore, the employer may want to return to the original schedule after, for example, several months. Nothing in the Act prohibits this further change to the schedule.
However, the definition of regular work day contemplates that the employee usually works a specific number of hours on a particular day. The more frequently the employer changes the schedule in relation to a particular day of the week, the less likely it is that the employee could be said to have a usual number of hours on a particular day of the week. In other words, the facts may reveal that there is no regular work day, in which case the daily limit in s. 17(1)(a) for that employee will be eight – subject to the exceptions to this limit set out in s. 17(2) and s. 19.
Note also that while the Act does not prohibit the employer from changing the regular work day, there may be restrictions against doing so in an employee’s employment contract. In this case, it may amount to a breach of the employment contract for the employer to change the regular work day, which may give rise to a constructive dismissal under the Act or at common law.
Employers who had established a regular work day that is longer than eight hours prior to proclamation of the ESA 2000, and that was in effect upon proclamation of the ESA 2000, are considered by the Program to have established a regular work day of more than eight hours for the purposes of s. 17(1)(a). Employers who wish to establish a regular work day of more than eight hours after proclamation of theESA 2000, as noted above, are not prohibited by the Act from doing so, although they may be constrained from doing so by considerations such as constructive dismissal, collective agreements, etc.
ESA Part I, s. 1 defines ork week as:
In ascertaining the recurring period of seven consecutive days established by the employer for the purpose of scheduling work, if any, an employment standards officer may consider such information as work schedules, time cards and pay periods, although these are not necessarily the same as the work week. In the absence of the employer having established a recurring period of seven consecutive days for the purpose of scheduling work, a default work week of Sunday to Saturday will apply.
O Reg 285/01, s. 6 sets out the circumstances in which work is deemed to be performed or not deemed to be performed. This provision is essential in determining the number of hours of work under this Part. Note that O Reg 285/01, s. 22 sets out special rules regarding when work is not deemed to be performed for residential care workers.
O Reg 285/01, s. 6 provides as follows:
Section 17(2) permits employers and employees to agree, in writing that the employee will work up to a specified number of hours in excess of the daily limit set out in s. 17(1)(a) – see ESA Part 1, s. 1(3) and s. 1(3.1) for a discussion of agreements in writing
Section 17(2) must be read in conjunction with s. 17(5), which provides that s. 17(2) agreements are not valid unless:
and
In attempting to facilitate opportunities to work excess hours, employers have inquired as to whether a signature on a sign-up sheet for additional hours might be considered a valid written agreement under s. 17(2). The Program’s view is that such a document would be valid if all of the following conditions are met:
The requirement regarding the Director’s information document in s. 17(5) does not apply to employees who are represented by a trade union - see s. 17(9)(b). Furthermore, different rules regarding the Director’s information document apply to employers who entered into agreements with employees to work excess daily hours under the provisions of the ESA 2000 before March 1, 2005, the date on which the amendments made by the Employment Standards Amendment Act (Hours of Work and Other Matters), 2004, SO 2004, c 21came into force. In particular, because the agreements were entered into under a scheme when the requirement of s. 17(5) was not in force, the conditions for a valid agreement in s. 17(5) do not apply to such employers. Instead, they are required to provide the information document to employees by June 1, 2005. See ss. 17(9) and (10).
In the absence of a valid written agreement, the daily limit on hours of work in s. 17(1)(a) applies, and the employer may not require or even permit an employee to work excess daily hours, unless exceptional circumstances within the meaning of ESA Part VII, s. 19 are present.
Agreements to work excess daily hours can generally be revoked by employees with two weeks' written notice and generally with reasonable notice by employers - see ss. 17(6) and (7), respectively. It is, however, the Program’s position that in situations where an agreement to work excess hours is made pursuant to a collective agreement, the ability to revoke the agreement to work excess hours must be made in accordance with the terms of the collective agreement and the Labour Relations Act, 1995, SO 1995, c 1, Sch A,where applicable. Generally, this means that unilateral revocation is not possible during the operation of the collective agreement.
Agreements to work excess daily hours can specify the exact number of hours that the employee is agreeing to work, the exact number of hours over and above the daily limit, or they can specify an upper limit (e.g., up to 10 hours a day
).
This section contemplates both one-off
agreements, where the employee agrees in writing to work excess daily hours on a single occasion, and more open-ended as required
agreements, where the employee agrees in writing to work a specified number of excess daily hours whenever required by the employer. For example, a retail employer preparing for the busy Christmas season may ask an employee to agree to with two days' notice, work up to 12 hours a day during the months of November and December of this year.
Agreements under s. 17(2) to work excess daily hours and agreements under s. 17(3) to work excess weekly hours are two separate agreements, although they can be embodied in the same document.
Note that there may be some circumstances in which what appears to be a single agreement with respect to excess daily hours by necessary implication includes an agreement with respect to excess weekly hours, and vice versa. For example, an employee regularly works nine hours a day, five days a week. On the fifth day of the week, the employee agrees in writing to exceed the daily limit and work four additional hours. By necessary implication, the employee has also agreed to work in excess of 48 hours in that work week, and, assuming that the employer had already received an excess weekly hours approval from the Director of Employment Standards that applies to the employee or that the pending approval rules in s. 17(4) apply to the employee, the employee will be permitted to work those excess hours. Or the same employee, who regularly works nine hours a day, whose employer operates only five days a week, enters into an agreement to work up to 60 hours per work week when required and the employer has an excess weekly hours approval from the Director that applies to the employee, or is operating under the pending approval
rules in s. 17(4), the employee, by necessary implication, has also agreed to work excess daily hours.
The Ministry has produced a list of items employers and employees may wish to consider when drafting agreements. These materials can be found Ministry of Labour’s web page Applications for Approval of Excess Hours or for Averaging Hours of Work as well as in the Hours of Work and Overtime Tool on the Ministry of Labour website.
Alsosee section ESA Part I, s. 1(3) and ESA Part 1, s. 1(3.1) for a discussion of agreements in writing.
Employers are required to retain a copy of every excess daily (and weekly) hours agreement it has made with its employees for three years after the last day on which work was performed under each agreement - see ESA Part VI, s. 15(8).
Section 17(3) permits employees' hours of work to exceed the weekly limit of 48 hours in a work week if three conditions are met:
Each of these conditions is discussed below.
Pursuant to s. 17(3)(a), the first condition that must be met before an employee is allowed to work more than 48 hours in a work week is the employee must have entered into an agreement with the employer that they will work the excess hours. The agreement must be in writing to be valid -see ESA Part I, s. 1(3) and (3.1) for a discussion of agreements in writingt, as well as the list of necessary and other elements of agreements at the end of that section. Also see the Ministry of Labour’s web page Applications for Approval of Excess Hours or for Averaging Hours of Work for a list of items employers and employees may wish to consider when drafting agreements, as well as the Hours of Work and Overtime Tool on the Ministry of Labour website.
In a non-unionized workplace, each employee has the right on an individual basis to enter into agreements to work excess weekly hours. For employees represented by a trade union, the written agreement may be embodied in the collective agreement, a memorandum of agreement or an addendum to an agreement. All bargaining unit members are bound by such an agreement. In this regard, see the discussion of ESA Part III, s. 7.
This section must be read in conjunction with s. 17(5), which provides that s. 17(3) agreements are not valid unless:
and
In attempting to facilitate opportunities to work excess hours, employers have inquired as to whether a signature on a sign-up sheet for additional hours might be considered a valid written agreement under s. 17(3). The Program’s view is that such a document would be valid if all of the following conditions are met:
See the discussion of s. 17(5) below for more information.
The requirement regarding the Director’s information document in s. 17(5) does not apply to employees who are represented by a trade union - see s. 17(9)(b). Furthermore, different rules regarding the Director’s information document apply to employers who entered into agreements with employees to work excess weekly hours before March 1, 2005, the date the amendments to the ESA 2000 requiring that the Director’s information document be given to employees came into force - see s. 17(9).
In the absence of a valid written agreement, the weekly limit on hours of work in s. 17(1)(b) applies, and the employer may not require or even permit an employee to work excess weekly hours, even if the Director of Employment Standards has issued an approval that applies to the employee, unless exceptional circumstances within the meaning of s. 19 are present.
Agreements to work excess weekly hours can generally be revoked by employees with two weeks' written notice even if the Director of Employment Standards has issued an approval that applies to the employee - see s. 17(6). Agreements to work excess weekly hours can generally be revoked by employers with reasonable notice - see s. 17(7).
The general right to revoke agreements is limited where the agreement is made between a union and the employer. It is the Program’s position that in situations where an agreement to work excess hours is made pursuant to a collective agreement, the ability to revoke the agreement to work excess hours must be made in accordance with the terms of the collective agreement and the Labour Relations Act, 1995 where applicable. Generally, this means that unilateral revocation is not possible during the operation of the collective agreement.
Further, an individual employee has no right to revoke an agreement made on their behalf by the union, with or without the agreement of the employer - see the discussion in ESA Part III, s. 7.
Agreements to work excess weekly hours can specify the exact number of hours that the employee is agreeing to work, the exact number of hours over and above the weekly limit, or they can specify an upper limit (e.g., up to 60 hours a week
).
This section contemplates both one-off
agreements, where the employee agrees in writing to work excess weekly hours on a single occasion, and more open-ended as required
agreements, where the employee agrees in writing to work a specified number of excess weekly hours whenever required by the employer. For example, a retail employer preparing for the busy Christmas season may ask an employee to agree to with two days' notice, work up to 60 hours a week during the months of November and December of this year.
Agreements under s. 17(2) to work excess daily hours and agreements under s. 17(3) to work excess weekly hours are two separate agreements, although they can be embodied in the same document.
Note that there may be some circumstances in which what appears to be a single agreement with respect to excess daily hours by necessary implication includes an agreement with respect to excess weekly hours, and vice versa. For example, an employee regularly works nine hours a day, five days a week. On the fifth day of the week, the employee agrees in writing to exceed the daily limit and work four additional hours. By necessary implication, the employee has also agreed to work in excess of 48 hours in that work week, and, assuming that the employer had already received an excess weekly hours approval from the Director of Employment Standards that applies to the employee, or that the pending approval rules in s. 17(4) apply to the employee, the employee will be permitted to work those excess hours. Or if the same employee, who regularly works nine hours a day and whose employer operates only five days a week, enters into an agreement to work up to 60 hours per work week when required and the employer has an excess weekly hours approval from the Director that applies to the employee, or is operating under the pending approval rules in s. 17(4), the employee, by necessary implication, has also agreed to work excess daily hours.
Employers are required to retain a copy of every excess weekly and daily hours agreement it has made with its employees for three years after the last day on which work was performed under each agreement - see ESA Part VI, s. 15(8).
Pursuant to s. 17(3)(b), the second condition that must be met before an employee may work more than 48 hours in a work week is the employer must be in receipt of an approval by the Director of Employment Standards under ESA Part VII, s. 17.1 that applies to the employee or to a class of employees that includes the employee.
ESA Part VII, s.n 17.1 describes how employers apply for an excess weekly hours approval.
This section must be read in conjunction with ESA Part VII, s. 17.1(9), which states:
Accordingly, where an employer already has an approval from the Director of Employment Standards, an employee who falls within the class of employees set out in the approval may begin working the excess weekly hours immediately upon entering into the agreement to do so (assuming that all of the requirements for a valid agreement are met) — the employer will not be required to apply for another approval. For example, an employee will be allowed to work excess weekly hours without the employer having to obtain another approval where the employee who provides the valid written agreement:
This section must also be read in conjunction with s. 17(4), which allows employees to work more than 48 hours in a work week (but only up to the lesser of 60 hours, the number of hours specified in the agreement, or the number of hours specified in the application) if the employer does not receive either an approval or a refusal from the Director within 30 days of the application being served, if certain conditions are met.
Pursuant to s. 17(3)(c), the third condition that must be met before an employee is allowed to work more than 48 hours in a work week isthat the employee’s hours of work in excess of 48 will be lawful only if the excess hours do not exceed the number of hours specified in the employee’s agreement or the number of hours specified in the Director’s approval, whichever is less.
For example, an employee agreed to work 70 hours in a work week, but the Director issued an approval for only 60 hours. The employee can work only up to 60 hours in a work week, and the employer will be in violation of the Act if the employee works more than 60 hours.
Conversely, an approval was issued for 65 hours that applies to a particular class of employees. Some employees in that class agreed to work up to 65 hours. Those employees are permitted to work up to 65 hours. One employee in that class agreed to work only up to 55 hours. Pursuant to s. 17(3)(c), that employee is permitted only to work up to 55 hours.
Another example is where an employee agreed to work up to 65 hours in a work week, and the employer has an approval allowing that employee to work up to 65 hours in a work week. The employee changes their mind and provides the employer with two weeks' written notice revoking that agreement, and simultaneously enters into an agreement to work up to only 50 hours in a work week. After the two week notice period expires, that employee is, pursuant to s. 17(3)(c), permitted to work only up to 50 hours in a work week.
This section provides an exception to the requirement in s. 17(3) that the employer have received an excess weekly hours approval from the Director before an employee is permitted to work excess weekly hours. It permits an employee to work more than 48 hours in a work week ― up to a maximum of the least of 60 hours, the number of hours specified in the agreement, or the number of hours specified in the application ― if the Director has not issued either an approval or a refusal of the application within 30 days of the date the application was served and other conditions are met.
This section permits excess hours to be worked pending the Director issuing an approval or a refusal if certain conditions are met. It does not deem
an approval to have been granted. If the application is ultimately refused, the excess hours must cease when the notice of refusal is received. If the application is ultimately approved, s. 17(3), and any conditions contained in the approval, will dictate the conditions under which excess hours can be worked from that point forward.
The employee will be permitted to work more than 48 hours in a work week pending the disposal of the application only if all nine conditions set out in s. 17(4) ― including the condition that the employee works no more than the least of 60 hours, the number of hours specified in the agreement, and the number of hours specified in the application - are met. If any of the nine conditions are not met, the employee will not be permitted to work more than 48 hours in a work week pending the disposition of the application.
Each of the nine conditions is discussed below.
Pursuant to s. 17(4)(a), the first condition is the employee must have made an agreement described in s. 17(3)(a) with the employer to work excess weekly hours.. In particular, note that for agreements made on or after March 1, 2005, the agreement is not valid unless the employer provided the employee with the information document described in s. 17(5) before the employee entered into the agreement, and the agreement contains a statement by the employee acknowledging that they received the document.
Pursuant to s. 17(4)(b), the second condition is the employer must have served the application for an approval of excess weekly hours on the Director of Employment Standards under ESA Part VII, s. 17.1 -see in particular the discussion of the issue of when an application is considered to be served if the approval application is not properly completed.
Pursuant to s. 17(4)(c), the third condition is the application for approval to work excess weekly hours that has been served on the Director must apply to the individual employee at issue, or to a class of employees that includes the employee.
Pursuant to s. 17(4)(d), the fourth condition is at least 30 days must have passed since the employer served the Director with the excess weekly hours approval application. Day means a calendar day.
Note that ESA Part VII, ss. 17.1(4) and (5) contain rules regarding when service is deemed to be effective, and, accordingly, when the 30-day period begins.
Note also that s. 17(11) contains a special rule regarding when the 30-day period expires if the application is filed before March 1, 2005.
Pursuant to s. 17(4)(e), the fifth condition is the employer not have received a notice from the Director that the application to work excess weekly hours has been refused.
Pursuant to s. 17(4)(f), the sixth condition is the employer’s most recent previous excess weekly hours application must not have been refused. If the employer previously submitted an application that was refused for any reason, and that application was the most recent application, the employer will not be permitted to rely on s. 17(4), and the employees that are the subject of the current application cannot begin to work excess weekly hours unless and until the current application is approved. This is so whether or not the most recent previous application that was refused applied to the same employees who are the subject of the current application.
Pursuant to s. 17(4)(g), the seventh condition is the most recent approval (if any) that was granted by the Director must not have been revoked. Pursuant to ESA Part VII, s. 17.1(16), the Director can revoke an approval.
Pursuant to s. 17(4)(h), the eighth condition is the employer must post and keep posted a copy of the application for approval of excess weekly hours. It must be posted in at least one conspicuous place in the workplace where each employee who is going to begin working excess weekly hours pending the disposal of the application works.
Note that the application should already be posted, as posting is one requirement of the application process - see ESA Part VII, s. 17.1(6).
Pursuant to s. 17(4)(j), the ninth condition sets an upper limit on the number of hours per work week an employee can work pending the disposal of the application. It means that the employee cannot work more than the least of any of the following amounts:
Because of s. 17(4)(i)(iii), the absolute limit on the number of hours per work week an employee can work pending the disposal of the application is 60, even if the employee agreed to work more than 60 hours and/or the application asks for an approval for the employee to work more than 60 hours. For example, an employee agreed to work up to 65 hours per work week, and the application asks for an approval for the class of employees to which the employee belongs to work 65 hours. While the application is pending (assuming the other conditions are met, including the 30-day wait period), the employee will be permitted to work only up to 60 hours.
Another example of the application of the ninth condition is an employee agreed to work up to 55 hours, and the application asks for an approval for the employee to work 55 hours. While the application is pending (assuming the other conditions are met, including the 30-day wait period), the employee will be permitted to work only up to 55 hours.
Section 17(5) provides that an employee’s agreement to work excess daily hours or excess weekly hours is not valid unless two conditions are met. These are intended to ensure and provide assurance to the Ministry that employees know their rights before signing agreements to work excess hours. Note that the conditions are in addition to the general requirements regarding agreements, i.e., that they be in writing, pursuant to ESA Part 1, s. 1(3) and s. 1(3.1) , and that they meet the requirements regarding issues such as voluntariness and specificity.
The two conditions are that an employee’s agreement to work excess daily hours pursuant to s. 17(2) or excess weekly hours pursuant to s. 17(3)(a) is not valid unless:
and
These two conditions do not apply to employees who are represented by a trade union - see s. 17(9)(b) below.
Different rules regarding the Director’s information document apply to employers who entered into agreements with employees to work excess weekly hours under the ESA 2000 as it stood before the amendments made by the Employment Standards Amendment Act (Hours of Work and Other Matters), 2004 came into force on March 1, 2005. Because these agreements were entered into before s. 17(5) was in force, the conditions in s. 17(5) do not apply to such employers. However, employers who had such agreements were required to provide the information document to employees by June 1, 2005. See the discussions of ss. 17(9) and (10) below.
If either of the conditions in s. 17(5) are not met, the agreement to work excess daily or weekly hours is not valid. And because a valid written agreement is required in order for an employer to require or even permit an employee to work excess hours, if either condition is not met, the employer will be in violation of the Act if any excess hours are worked (unless, of course, "exceptional circumstances" within the meaning of s. 19 are present). This is so even if the Director has issued an approval that applies to the employee in question.
Agreements under s. 17(2) to work excess daily hours and agreements under s. 17(3) to work excess weekly hours are two separate agreements, although they can be contained within the same document. If they are in the same document and the conditions in s. 17(5) are not met, both agreements are invalid, and the employee cannot be required or permitted to work either excess daily hours or excess weekly hours. If the agreements are separate, both agreements must contain the statement described in s. 17(5)(b). If, for example, only the excess daily hours agreement contains the statement, then the excess weekly hours agreement will not be valid.
The Director’s information document needs to be provided only once, even if the excess daily hours agreement and the excess weekly hours agreement are made at different times, provided that the Director did not publish a revised information document after the earlier agreement was made but before the later agreement was made.
An employer gives the most recent Director’s information document to an employee on May 1, 2005, and the employee provides a written agreement to work excess daily hours on May 2, 2005. The agreement states that the employee was told by the employer that the information document they were provided with is the most recent one published. One month later, the employer asks the employee if they would be willing to work excess weekly hours and they indicate that they would. No revised information document has been published, and the employer tells the employee that the document provided to her on May 1, 2005 is still the most recent document published by the Director. The employee then provides a written agreement to work excess weekly hours; it states that the employee has been given an information document that the employer told her was the most recent one published. Since there was no new information document published between May 2, 2005 and the making of the excess weekly hours agreement and the agreement contains an acknowledgement that the employee has received what the employer has represented is the most recent document, the condition in s. 17(5)(b) is met.
As mentioned above, the two conditions contained in s. 17(5) are in addition to the other requirements regarding agreements. One of these requirements is there must be informed consent by the employee. There may be circumstances where, despite the conditions in s. 17(5) being met, there is not informed consent. For example, if the employee cannot read or understand the information document, was not given an explanation, and was not otherwise aware of what theirrights are, then even though the conditions of s. 17(5) have been met, the agreement will not be valid because the element of informed consent is absent. Accordingly, the employee will not be permitted to work the excess hours.
This section requires that an employee provide an employer with at least two weeks' written notice before withdrawing from an agreement made under s. 17(2) to work excess daily hours or from an agreement made under s. 17(3)(a) to work excess weekly hours. Note that special rules on revocability apply to agreements to work excess daily hours under O Reg 285/01, s. 32 and arrangements regarding daily hours under O Reg 285/01, s. 32.1.
The employee must give the notice in writing; verbal notice will not meet the requirement of this section. Note that where the agreement has been made by the union on behalf of the employee, that the employee has no individual right to revoke the agreement. See the discussion at 7.
Further, it is the Program’s position that in situations where an agreement to work excess hours is made pursuant to a collective agreement, the ability to revoke the agreement to work excess hours must be made in accordance with the terms of the collective agreement and the Labour Relations Act, 1995 where applicable. Generally, this means that unilateral revocation is not possible during the operation of the collective agreement.
Where employees are able to revoke an agreement and provide the employer with the proper notice, the hours of work limits in s. 17(1) will again apply once the two-week notice period to revoke the agreement to work excess hours has expired, and the employer will no longer be able to require or permit an employee to work beyond those limits, even if the Director has issued an approval to work the excess hours,subject to exceptional circumstances as set out in ESA Part VII, s. 19.
Section 32 of O Reg 285/01, s. 32 provides:
ESA Part XXVII, ss. 141(9) and (10) provide:
Together these sections provide that despite s. 17(6), employees who were hired on or after September 4, 2001, and who agreed in writing at the time of hiring to work hours in excess of the daily maximum cannot unilaterally withdraw from the agreement, even with two weeks' notice, if the Director of Employment Standards approved the agreement. The agreement can be revoked only if the employer and employee both agree, in writing, to revoke it.
Note that this exception to the revocability of agreements applies only to agreements to work excess daily hours. These employees retain the right under s. 17(6) to revoke, with two weeks' written notice, agreements to work excess weekly hours.
Note also that employees who are party to these approved agreements to work excess daily hours cannot be required to work more than 10 hours a day except in exceptional circumstances as set out in ESA Part VII, s. 19 - see ESA Part XXVII s. 141(9).
This section requires an employer to provide an employee with reasonable notice if it wishes to withdraw from an agreement regarding excess daily hours made under s. 17(2) or from an agreement regarding excess weekly hours made under s.17(3)(a). Note that agreements under O Reg 285/01, s. 32 and arrangements under O Reg 285/01, s. 32.1 can be revoked only if both the employer and employee wish to revoke them.
The notice is not required to be in writing. Unlike the notice requirement in s. 17(6), verbal notice will suffice, although employers may wish to put the notice in writing in order to avoid misunderstandings.
Whether the notice provided by an employer is reasonable will depend upon the circumstances of each case. The Program does not view reasonable notice in the context of revoking an excess hours agreement under the ESA 2000 to be the same as reasonable notice as that term is used in the context of notice of termination under the common law, and, as such, the principles applied at common law are not necessarily applicable here.
Factors for consideration when determining whether the length of notice is reasonable may include:
It is the Program’s position that in situations where an agreement to work excess hours is made pursuant to a collective agreement, the ability to revoke the agreement to work excess hours must be made in accordance with the terms of the collective agreement and the Labour Relations Act, 1995 where applicable. Generally, this means that unilateral revocation is not possible during the operation of the collective agreement.
Once an excess hours agreement is revoked, the hours of work limits in s. 17(1) will once again apply, and the employer will no longer be able to require or permit an employee to work beyond those limits ,subject to exceptional circumstances as set out in ESA Part VII, s. 19.
It is the Program’s view that an agreement to work excess hours under s. 17(2) or s. 17(3)(a) does not require an employer to provide employees with excess hours; it only allows for excess hours be worked, permitting an employer to require an employee to work any excess hours the employer chooses to provide, assuming, of course, in the case of excess weekly hours that an approval has been granted. An agreement under s. 17(2) or s. 17(3)(a) is in no way a guarantee of wages and there is no basis for a claim by an employee of a violation of the Act (e.g., insufficient notice of a constructive dismissal) if excess hours are not provided.
Section 17(8) is a transitional provision. It establishes how agreements to work excess hours that were entered into under the provisions of the ESA 2000 before the amendments made by the Employment Standards Amendment Act (Hours of Work and Other Matters), 2004 came into force are to be treated.
On February 28, 2005, the relevant provisions read as follows:
Section 17 of the ESA 2000:
Section 31 of O Reg 285/01:
Accordingly:
While the agreements that were entered into under the authority of s. 17(2) and O Reg 285/01, s. 31 as they read on February 28, 2005 ("old agreements") are treated as if they are agreements made under the current s. 17 ("new agreements"), thereby negating the need for employers to enter into another agreement with employees when the amendments to the Act came into force, the rules regarding the Director’s information document are different. See the discussions of ss. 17(9) and (10) below. Otherwise, old agreements and new agreements are treated the same. In particular, employers who have old agreements with employees must seek approval from the Director before the employee can work more than 48 hours per work week.
This section sets out two exceptions to the application of s. 17(5). Section 17(5) provides that agreements to work excess daily or weekly hours are not valid unless:
and
See above for a discussion of s. 17(5).
Section 17(9) provides that the s. 17(5) requirement does not apply to:
The agreements described in s. 17(8) are those agreements that were entered into under the provisions of the Act before the amendments made by the Employment Standards Amendment Act (Hours of Work and Other Matters), 2004 came into force on March 1, 2005. Because the agreements were entered into at a time when the requirement of s. 17(5) was not in force, the conditions for a valid agreement in s. 17(5) do not apply.
Note however that s. 17(10) requires employers who are party to an agreement described in s. 17(8) to provide the information document to employees by June 1, 2005. See the discussion of s. 17(1) below.
The two conditions for a valid agreement that are set out in s. 17(5) do not apply to agreements made in respect of employees who are represented by a trade union.
This provision applies to employers who entered into agreements with employees described in s. 17(8), i.e., old agreements entered into under the provisions of the Act before amendments made by the Employment Standards Amendment Act (Hours of Work and Other Matters), 2004 came into force on March 1, 2005.
Section 17(9) provides that the two conditions in s. 17(5) regarding the Director’s information document that must be satisfied before written agreements are valid do not apply to old agreements - see s. 17(9) above. However, s.17(10) requires employers who are a party to these old agreements to provide the employees concerned (unless represented by a union) with the most recent information document no later than June 1, 2005.
A failure by an employer who was party to an old agreement to provide the information document by June 1, 2005, while it constitutes a violation of the Act, does not invalidate the agreement, as contrasted with the result where an employer does not provide the document when an excess hours agreement is entered into on or after March 1, 2005 - see s. 17(5). However, the general proposition that agreements are not valid unless the employee gave their informed consent still applies to these old agreements. See the discussion of the requirements of written agreements at ESA Part I, s. 1(3) and s. 1(1.3).
This is a transitional provision. Pursuant to ESA Part VII, s. 17.1(22), employers can apply for approval of excess weekly hours agreements as of December 9, 2004, the day that the Employment Standards Amendment Act (Hours of Work and Other Matters), 2004 received Royal Assent, even though the amendments that require approvals for excess weekly hours are not effective until March 1, 2005. Applications are permitted prior to March 1, 2005 in order to facilitate a seamless transition between the old rules and the new rules.
Section 17(4) permits, in certain circumstances, an employee to work more than 48 hours a work week (up to a maximum of 60) if the employer has not received either an approval or a refusal of an excess weekly hours application within 30 days of the date the application was served. By virtue of s. 17(11), where an employer applies for an approval for excess weekly hours prior to March 1, 2005, the 30-day wait period will expire on March 1, 2005 at the earliest.
For example, an employee agreed in writing to work up to 55 hours per week for an indefinite period back in July 2003. The employer served an application for an excess weekly hours approval on the Director on January 28, 2005. As of March 1, 2005, the Director had not issued either an approval or a refusal of the application. This employee:
This provision requires that an employee be free from performing work for a particular employer for a period of at least 11 consecutive hours in each day. This requirement is subject to s. 18(2) (employees on call) and s. 19 (exceptional circumstances).
The requirement for 11 consecutive hours off work in each day operates simultaneously with the other provisions in Part VII of the Employment Standards Act, 2000. For example, an employee may agree in writing to work two eight-hour shifts in a row without any break in between them, thus complying with s. 18(3), but if that results in the employee receiving less than 11 consecutive hours off in a day, the schedule will be in violation of s. 18(1) and, therefore, will not be permitted. In other words, an employee cannot agree to work hours that would result in the employee getting less than the 11 consecutive hours free from work required under s. 18(1). See Independent Paperworkers of Canada v Norampac Inc.
The period of 11 hours free from work must be consecutive. That is, it must be a single period, continuous and unbroken. The word consecutive
was added to s. 18(1) by the Government Efficiency Act, 2002, SO 2002, c 18, effective November 26, 2002. The amendment codified Program policy in this respect.
A day
in this context means a 24-hour period; it does not have to be a calendar day. The Program uses the following interpretation of day in the context of s. 18(1):
This interpretation of day means that the days do not have to be consecutive. That is, there can be gaps of time in between the end of one day and the beginning of the next day, but only if the employee did not work during that time.
This interpretation of day also means that days cannot overlap with other days for that employee. That is, the beginning of a day cannot be any earlier than the end of the previous day.
Note that the Program’s policy regarding the interpretation of the word day in this section has been supported in an arbitrator’s decision — see Independent Paperworkers of Canada v Norampac Inc. on the principle that it appropriately refers to the employee’s actual work pattern (actual time on
and time off
) as opposed to a calendar day or even a day as defined in a collective agreement. The arbitrator took the position that the Program’s interpretation was:
Employee’s schedule:
The days in this employee’s work cycle are:
There are at least 11 consecutive hours off in each day. As such, this schedule meets the requirements of s. 18(1).
Employee’s schedule:
The days in this employee’s work cycle are as follows:
There are at least 11 consecutive hours off in each day. As such, this schedule meets the requirements of s. 18(1).
Note that while an employee with this kind of shift schedule may agree in writing to work more than twelve hours a day, thereby complying with s. 17 of the Act, their ability to do so is restricted by s. 18. For example, an employee with this kind of shift schedule may agree in writing to work an extra four hours after their regular 12-hour shift because a co-worker did not show up. While the requirements of s. 17 (which permits employees to work in excess of their regular established work day that is longer than eight hours if they agree in writing to do so) and s. 18(3) (which permits employees to work successive shifts that together total more than 13 hours if they agree in writing to do so) are met, the requirements of s. 18(1) will not be met. The employee would have worked 16 hours in a day, resulting in there being only eight consecutive hours free from work in that day.
Employee’s schedule:
The days in this employee’s work cycle are:
There are at least 11 consecutive hours off in each day. As such, this schedule meets the requirements of s. 18(1).
short shift change
Employee’s schedule:
In this example, the employee moves from working the 8 am to 4 pm shift to working the midnight to 8 am shift in the same cycle.
The days in this employee’s work cycle are as follows:
There is no period of 11 consecutive hours off in the third day, which is Wednesday 8:00 a.m. to Thursday 8:00 a.m. During that day, which is when the short shift change occurred, the employee worked 8:00 a.m. to 4:00 p.m., was off from 4:00 p.m. to 12:00 a.m. (eight hours) and then went back to work from midnight to 8:00 a.m. The employee received only eight consecutive hours off. This schedule does not meet the requirements of s. 18(1).
Employee’s schedule:
In this example, the employee moves from working the 8 am to 4 pm shift to working the 4:00 a.m. to 12:00 p.m. shift in the same work cycle.
The days in this employee’s work cycle are as follows:
There are at least 11 consecutive hours off in each day. As such, this schedule meets the requirements of s. 18(1).
Employee’s schedule:
In this example, the employee normally works 8 am to 4 pm, Monday to Friday. On Wednesday, the employee is asked to stay on and work an extra eight hour shift. The employee agrees in writing to receive less than eight hours off in between successive shifts that total more than 13 hours, as required by s. 18(3). However, the resulting schedule does not meet the s. 18(1) requirement to have at least 11 consecutive hours off each day.
The days in this employee’s work cycle are as follows:
There is no period of 11 consecutive hours off in the third day, which is day is Wednesday 8:00 a.m. to Thursday 8:00 a.m. During that day, which is when the back-to-back shift occurred, the employee worked 8:00 a.m. to 4:00 p.m., then again from 4:00 p.m. to 12:00 p.m., and was off from midnight to 8:00 a.m. (eight hours). The employee received only eight consecutive hours off. This schedule does not meet the requirements of s. 18(1).
This provision provides an exception to the requirement in s. 18(1) that an employee be given at least 11 consecutive hours free from work each day. The exception applies to an employee who is on call and is called in during a period he or she would not otherwise have been expected to work.
This on call
exception is an exception only to the 11 consecutive hours free from work each day requirement ins. 18(1). It is not an exception to any other hours of work provisions, e.g., limits on hours of work, requirement for time off between shifts, the weekly or bi-weekly free time requirement. This means, for example, that if the hours worked while on call will result in the s. 17(1) limits on hours of work being exceeded, the employer must first get the employee’s written agreement to work the excess hours.
The phrase called in during a period in which the employee would not otherwise be expected to perform work
has been held not to include situations where the employee was asked to remain at work following the conclusion of his or her regular shift. In Imperial Tobacco v Bakery, Confectionary and Tobacco Workers International Union, Local 323T, (2002), 111 LAC (4th) 434 (Ont Arb Bd), although the union argued that such post-shift work was described in the collective agreement overtime provisions as call-in
work, the arbitrator disagreed and in any case held that this could not override the meaning of the phrases on call
and called in to work
as used in s. 18(2). As a consequence, the exception in s. 18(2) did not apply and the parties were subject to the 11-hour daily rest requirement.
Similarly, the Program does not consider an employee who had been asked to work a relief
shift (e.g., to pick up a shift for an employee who had called in sick) to be an employee who is on call.
The Program considers on call
employees to refer, for example, to an employee who is required to be accessible by pager, phone or e-mail to respond to call(s) to perform work. The work so performed may include work done over the phone or by e-mail as well as work done at the employer’s workplace.
This section requires employers to provide employees with a minimum period free from work of eight hours between successive shifts, with two exceptions. First, an employee may work successive shifts without the eight-hour free period if the total number of hours worked on the successive shifts is 13 or less. Second, the employer and employee can agree, in writing, to forego the eight hour period entirely or reduce its length – see ESA Part I, subsections 1(3) and (3.1) for more information on agreements in writing.
Successive shifts
are two shifts following one after another, whether or not there is time off in between the shifts. It includes split shifts
, back-to-back
shifts, as well as ordinary daily shifts. Section 18(3) may also apply when an employee is on an on call
shift. In that case, the employee is not at the workplace but is holding himself or herself ready for a call to work — see the discussion of this term in subsection (2) above. Note that when employees are on call the first point in an on call period
in which the employee actually performs work will mark the commencement of a successive shift and any time actually worked while the employee is on call will count towards the maximum 13 hours of work that may be performed.
The requirement for rest in between shifts operates simultaneously with the other provisions in Part VII of the Act. For example, an employee may agree in writing to work two eight-hour shifts in a row without any break in between them, thus complying with s. 18(3), but if that results in the employee receiving less than 11 consecutive hours off in a day as required by s. 18(1), the schedule will be in violation of s. 18(1) and, therefore, will not be permitted.
On a similar note, the other provisions in Part VII continue to apply even if one of the two exceptions to the application of s. 18(3) apply. For example, an employee may work his or her regular six-hour shift, then be asked by the employer to stay on for another six-hour shift. While the requirement for the eight-hour period free from work between shifts will not apply (because the time worked on successive shifts is 13 hours or less), the hours of work limit in s. 17(1), for example, do apply and the employer must get the employee’s written agreement to work excess daily hours.
Some have argued that s. 18(3) is redundant of s. 18(1), in that it does not require any rest period that s. 18(1) does not already require. The following example demonstrates how that is not the case:
Section 18(1) requires 11 hours off per day. Section 18(3) requires eight hours off between shifts when consecutive shifts exceed 13 hours.
Employee’s schedule:
Days in employee’s work cycle:
Day 1 and day 2 comply with s. 18(1) because the employee has at least 11 hours off each day. Day 2 does not comply with s. 18(3), because the total number of hours worked during the 10 hour shift (which started on day 1 and finished on day 2) and the following four hour shift exceeds 13 hours, yet there are only seven hours off between the two shifts. Unless there is a written agreement as per s. 18(3), there will be a violation of s. 18(3). Section 18(3) is not concerned with what happens in a day, it only deals with time off between shifts, regardless of which day those shifts fall on.
Section 18(4) of the Act establishes weekly or bi-weekly free time requirements for employees. The free time periods must be at least either:
work weeks
The reference to two consecutive work weeks indicates a rolling
two work week period. Program policy originally viewed each period of two work weeks as separate and distinct with no overlap. However, the language of the section indicates that free time is to be in every period of two work weeks
. Program policy now is that in each and every period of two work weeks, the employer must provide an employee a period free from the performance of work of at least 48 consecutive hours. For example, if an employer provides employees with a period free from the performance of work on a bi-weekly basis, there must be a period of at least 48 consecutive hours in which the employee is free from work in work weeks 1 and 2, in work weeks 2 and 3, in work weeks 3 and 4, and so forth.
Any time an employee is free from the performance of work can be used to satisfy the requirement of s. 18(4). For example, time an employee is off work because they are off on a public holiday, on sick, family responsibility or bereavement leave, on short-term disability, or on vacation can all be used to satisfy this requirement.
A work week
is defined in s. 1(1) of the Act as:
See ESA Part I, s. 1 for a discussion of the definition of "work week".
There is no provision for employees to agree to forego their required weekly or bi-weekly free time. However, the right to the free time can be overridden in s. 19 exceptional circumstances.
The issue has arisen as to whether an employer is permitted under this section to switch back and forth from complying with the weekly free time requirement in some weeks to complying with the bi-weekly free time requirement in other weeks, and vice versa.
Nothing in this subsection prohibits the practice of switching
. However, the manner in which the switch must be effected in order to be in compliance with s. 18(4) will result in a schedule that provides the employee with, on average, no less than 24 hours free from the performance of work in every work week.
For example:
The employer starts its schedule by complying with the bi-weekly free time requirement:
The employer then wants to switch to comply with the weekly free time requirement. It creates this schedule:
This schedule is not in compliance with s. 18(4). As stated above, the reference in s. 18(4)(b) to every two consecutive work weeks
is a rolling two work week period; every two work weeks must contain at least 48 hours of free time in order to comply with the biweekly free time requirement. In this example, Week 1 and Week 2 and Week 3 are all subject to the biweekly free time requirement. This means that:
The requirement is met in the example.
Because only 24 hours free time were provided in the two-week period of Week 3 and Week 4, the employer has not complied with s. 18(4) in this example. In order to effect the switch from complying with the biweekly free time requirement to the weekly free time requirement after Week 3, the employer must schedule at least 48 hours off in Week 4.
This provision allows employers to require employees to work more daily or weekly hours than are permitted under s. 17 or to work during a free period (daily, in between shifts and weekly or bi-weekly) as required by s. 18, in any of the four specified circumstances, but only so far as is necessary to avoid serious interference with the ordinary working of the employer’s establishment or operations.
Hours worked pursuant to s. 19 while s. 19 is in operation are not counted towards the normal limits in s. 17, nor are they taken into account when determining whether the requirements for free periods under s. 18 have been met. (Note, however, that hours worked while s. 19 is in operation will count for the purposes of determining whether any overtime pay is owing.)
An employer may require an employee to work hours in excess of those permitted under s. 17 or during a free period required under s. 18 to deal with an emergency, but only so far as is necessary to avoid serious interference with the ordinary working of the employer’s establishment or operations.
For example, a fire in the workplace or a natural disaster may constitute an emergency.
An employer may require an employee to work hours in excess of those permitted under s. 17 or during a free period required under s. 18, but only so far as is necessary to avoid serious interference with the ordinary working of the employer’s establishment or operations, if:
The phrase essential public services
refers to services that are provided to the public at large and which may be considered essential
because they are necessary for an employer to prevent situations that could result in, for example:
An example of an essential public service would include the provision of an uninterrupted public power supply if a disruption could result in any of the situations listed above. For example, if a power disruption would threaten patient care at hospitals and nursing homes, an uninterrupted supply of power would be considered an essential public service since it is necessary to prevent danger to the life, health and safety of patients.
This exception applies regardless of who delivers those [essential public] services
. As such, this provision could apply to employees who work for private companies that deliver public services (for example, privately run ambulance or road-clearing services, or a business that provides food to hospitals).
An employer may require an employee to work hours in excess of those permitted under s. 17 or during a free period required under s. 18, but only so far as is necessary to avoid serious interference with the ordinary working of the employer’s establishment or operations if:
An employer may require an employee to work hours in excess of those permitted under s. 17 or during a free period required under s. 18, but only so far as is necessary to avoid serious interference with the ordinary working of the employer’s establishment or operations, if the employee is needed to carry out urgent repair work to the employer’s plant or equipment.
An example of such a situation may be where management determines, whether or not in the course of routine maintenance, that repairs are urgently required to be done to machinery and a delay in carrying out the repairs will result in serious damage.
Section 19 is intended to allow employers to require employees to work hours in excess of the usual limits or during required rest periods only in exceptional circumstances. It is not intended to allow employers to require extra work of employees to address, for example, problems that arise because of inadequate business planning, or changes in business cycles (e.g., a fluctuation in the level of demand for the employer’s product).
This section imposes an obligation upon an employer to provide an eating period of at least 30 minutes timed so that no employee works longer than five consecutive hours without receiving an eating period. This requirement is subject to the exception set out in s. 20(2).
Unless the employee receives an uninterrupted 30 minutes, he or she is not considered to have received his or her entitlement under s. 20(1). However, note that under s. 6(2)(a)(i) of O Reg 285/01, work performed during the time employees are entitled to take time off work for an eating period (i.e., where the employee decides on his or her own initiative to work during the eating period even though he or she is entitled to the time off to eat) is deemed not to be performed. See O Reg 285/01, s. 6 for a discussion of this provision.
It is the Program’s policy that s. 20 of the Employment Standards Act, 2000 and s. 6 of O Reg 285/01 allows employers to require employees to take their eating periods in a designated place (e.g., on the employer’s premises) and to be on call
(i.e., available to return to work) while on the eating period. Unless the employee is actually required to work during the eating period (i.e., he or she is interrupted by a work demand before the period is completed), the employee will be considered to have received the eating period entitlement for the purposes of s. 20.
Further, it is the Program’s policy that the Act does not require employers to schedule a particular time for the employee to take as the eating period. For example, in a retail shop that has only one employee working during a shift, the employer may tell the employee to take his/her eating period when there are no customers for a stretch of time. If the employee has an uninterrupted period of 30 minutes during the requisite five-hour period, there will be compliance with s. 20. If an employee is interrupted at any point during the 30-minute period, the eating period is considered not to have been provided, and a new uninterrupted 30-minute period must be given during the requisite five-hour period. See subsection (2) below for a discussion on splitting up the eating period under s. 20(2).
It should also be noted that there is no obligation upon an employer under the Act to provide any break (e.g., coffee breaks) in addition to the eating period requirement of s. 20(1).
This section provides an exception to the eating period requirement in s. 20(1). It provides that instead of the requirement in s. 20(1), an employer and employee may agree to an alternative eating period arrangement whereby the employee receives two eating periods that together total at least 30 minutes within a period of five consecutive hours. Agreements under this section need not be in writing. Unlike the requirement in s. 20(1), the eating periods must be completed before the five-hour period expires (under s. 20(1), the eating period can begin at the five-hour mark). For example, an employer and employee may agree that an employee will receive two 15-minute eating periods within the 5-hour period. Consistent with the Program’s interpretation of s. 20(1), it is the Program’s position that the employer is not required to schedule particular times for the employee to take the eating periods as long as it is within the time period specified in s. 20(2). Additionally, the employer can require the employee to take the two 15-minute periods in a designated place and to be on call
while on the break. For employees to be considered to have received their entitlement under s. 20(2), the two eating periods must be uninterrupted. (However, note that under s. 6(2)(a)(i) of O Reg. 285/01, work performed during the time employees are entitled to take time off work for an eating period (i.e., where the employee decides on his or her own initiative to work during the eating period(s) even though he or she is entitled to the time off to eat) is deemed not to be performed. See O Reg. 285/01, s.6 for a discussion of this provision.
Agreements under s. 20(2) can specify the length of the two shorter periods, or they can be open-ended, providing that the two shorter periods will be of unspecified lengths that together total 30 minutes. For example, there is a one-person workplace where the employee is required to remain at the workplace on call
, and the employer does not schedule a particular time for the employee to take the eating period. The employer and employee may enter into an agreement that provides that the eating period will be split into two shorter periods of unspecified length as may be necessary to deal with customers. In this case, if, for example, the employee had 20 uninterrupted minutes before a customer came in, there will be compliance with s. 20(2) so long as the employee subsequently has an uninterrupted 10-minute period within the requisite five-hour period.
There is no provision for an employer and an employee to agree to take the eating period in more than two instalments, to eliminate eating periods altogether or to extend the time in which an eating period must be given (e.g., to six or seven hours).
This provision states that employers are not obliged to pay employees for time spent on eating periods where work is not being performed, unless the terms of the employee’s employment contract stipulate otherwise.
In the event that an employee is required to work during the eating period, the eating period counts as hours of work and must be paid for only to the extent of the actual interruption. (In such a case, there may also be a violation of the s. 20 requirement to provide the employee with an eating period.) The rules are different for breaks other than eating periods, e.g., coffee breaks. See O Reg 285/01, s. 6.
These provisions are to be read in conjunction with s. 17(5) of the Employment Standards Act, 2000. Section 17(5) provides that employees' written agreements to work excess daily or weekly hours are, with some exceptions, invalid unless, among other things, the employer gives the employee a copy of the Director’s information document described in s. 21.1 before the employee enters into the agreement.
Note that pursuant to s. 17 (9), this requirement does not apply in respect of excess hours agreements made before March 1, 2005, the date that the amendments made by the Employment Standards Amendment Act (Hours of Work and Other Matters), 2004, SO 2004, c 21 came into force, or in respect of excess hours agreements relating to an employee represented by a union [whenever made], although in the case of the former the employer was (pursuant to another subsection — s. 17(10) — that has since been repealed) required to provide a copy of the information document to the employee concerned by June 1, 2005.
These provisions provide that the Director of Employment Standards will prepare and publish an information document that describes rights of employees and obligations of employers under Part VII (Hours of Work and Eating Periods) and Part VIII (Overtime Pay). The rights and obligations that are to be contained in the document are those that the Director believes an employee should be made aware of in connection with excess hours agreements. If the Director believes that the document is out of date, he or she will prepare and publish a new document.
Part VII.0.1 was added to the ESA 2000 by the Working for Workers Act, 2021 (WFWA), effective December 2, 2021.
Part VII.0.1 of the ESA requires employers that employ 25 or more employees on January 1st of any year to have a written policy in place before March 1st of that year for all employees with respect to disconnecting from work. The policy must include the date it was prepared and the date any changes were made to the policy. The employer also has certain obligations with respect to providing a copy of the written policy to its employees and with respect to the retention of its disconnecting from work policies (see subsection 15(8) for more information on the record-keeping obligations).
A transitional provision sets out different timeframes that apply when the Part first takes effect; employers are to use January 1, 2022 (which is the January 1st immediately preceding the date that is six months after the WFWA receives Royal Assent) as the point-in-time to establish whether they meet the “25-employee threshold” and, if they do, they must have a written policy in place for all employees with respect to disconnecting from work by June 2, 2022 (which is six months after the day the WFWA received Royal Assent). After 2022, the transition provision will no longer have any effect and the time periods apply as set out in subsection 21.1.2(1).
The phrase “disconnecting from work” is defined to mean not engaging in work-related communications, including emails, telephone calls, video calls or the sending or reviewing of other messages, so as to be free from the performance of work.
Part VII.0.1 applies to all employees and employers covered by the ESA, except the Crown, a Crown agency or an authority, board, commission or corporation all of whose members are appointed by the Crown and any employees of such an employer. See section 2.1 of O. Reg. 285/01 for information.
This provision was added to the ESA by the Working for Workers Act, 2021 effective December 2, 2021. Section 21.1.1 defines the phrase “disconnecting from work” for the purposes of Part VII.0.1 of the Act. As such, this definition applies to the requirement set out in section 21.1.2 providing that, where the relevant criteria are met, an employer must – within the required timeframe - ensure it has a written policy in place for all employees with respect to disconnecting from work.
“Disconnecting from work” is defined to mean not engaging in work-related communications, including emails, telephone calls, video calls or the sending or reviewing of other messages, so as to be free from the performance of work.
The definition provides an inclusive list of some types of work-related communications: emails, telephone calls, video calls, sending and/or reviewing of other messages. As this list is inclusive, and not exhaustive, other types of work-related communications could equally fall under this definition.
Per the definition, “disconnecting from work” means not engaging in work-related communications and, as such, the employee would consequently “be free from the performance of work” during the time the employee is “disconnected”. Note that per the ESA’s rules on when work is deemed to be performed, if an employee performs work, for example engages in reviewing or drafting emails, the time the employee spends doing those activities is generally considered to be “working time” under the ESA. This is the case even if the employee does so, for example, from home after the employee’s day shift is over and where a “disconnecting from work” policy that says employees are not to work from home is in place. See s. 1.1 of O. Reg. 285/01 for more information.
Subsection 21.1.2(1) was added to the ESA 2000 by the Working for Workers Act, 2021, effective December 2, 2021.
Section 21.1.2 creates certain obligations on employers to put in place and distribute to their employees a written policy about “disconnecting from work”. This section does not establish a right for employees to disconnect from work. Employees’ rights under the ESA to not perform work are established in other Parts of the Act, particularly the Hours of Work and Eating Periods, Vacation With Pay, and Public Holiday Parts of the Act, in conjunction with the “When Work Deemed to be Performed” provision in O. Reg. 285/01. However, an employer’s policy may amount to a greater right or benefit than an employment standard under the Act or may otherwise be contractually binding, and therefore the policy may itself establish a right that applies instead of the employment standard.
Subsection 21.1.2(1) provides that an employer that employs 25 or more employees on January 1st of any year must, before March 1 of that same year, ensure that a written policy is in place for all employees with respect to disconnecting from work. Disconnecting from work is defined in section 21.1.1. The policy must include the date the policy was prepared and the date any changes were made to the policy.
Note that this provision must be read in conjunction with subsection (5) , which is a transition provision that applies when the Part first takes effect. Subsection (5) modifies both the reference date for determining whether the 25-employee threshold is met (to January 1, 2022) and the timeframe within which a written policy with respect to disconnecting from work must be in place to June 2, 2022 (which is six months after Royal Assent). After 2022, the transition provision will no longer have any effect and the time periods apply as set out in subsection 21.1.2(1).
In order to better understand the provision, the key elements have been broken down and discussed individually below.
In order for an employer to be required to have a written policy in place for all employees with respect to disconnecting from work under the ESA, the employer must employ 25 or more employees on January 1st of any year. This is a point-in-time assessment. In other words, in order to determine whether this criterion is met, the employer must take a “snapshot” of the number of employees it employs on January 1st.
If on January 1st, the employer employs fewer than 25 employees, then the ESA does not impose a requirement that the employer have a written policy in place with respect to disconnecting from work. This is the case even if the employer’s employee count increases at a later point in the same calendar year. For example, if an employer employs 20 employees on January 1st (and hence the requirement does not apply) and later hires five more employees in June of that same year, the employer continues to not be subject to the requirements to have a written policy in place for all employees with respect to disconnecting from work. However, if all 25 employees remain employed by that employer, the employer will have obligations under this Part in the following year when the “snapshot” assessment is again undertaken on the following January 1st. In this example, the employer will have 25 employees on that January 1st date and will therefore be required to have a written policy in place for all employees with respect to disconnecting from work before March 1st of that year.
Conversely, if an employer employs 25 employees or more on January 1st (and hence the requirement applies) and that employer’s employee count decreases at a later point in the same calendar year, the employer is still obligated to have a written policy in place with respect to disconnecting from work. This is the case until the “snapshot” assessment of the “25-employee threshold” is again undertaken on the following January 1st. If the employer employs fewer than 25 employees on January 1, the ESA requirement to have a written policy in place no longer applies to that employer.
There are a number of issues that may arise in determining whether the “25-employee” threshold is met:
If two or more employers are treated as one employer by virtue of s. 4 of the Act, then all employees employed by these two or more employers are included when determining whether the "25-employee" threshold has been met. This is because of the definition of "employer" in s. 1 of the Act, which reads:
Where a single employer has multiple locations, all employees employed at each of the locations in Ontario are to be included when determining whether the "25-employee" threshold has been met. For example, an employer owns three sandwich shops with 12 employees employed in each shop on January 1st. This employer employs 36 employees. The employer must have a written policy in place for all employees with respect to disconnecting from work, even though there are fewer than 25 employees employed at each individual shop.
All workers who meet the definition of "employee" are included when determining whether the 25-employee threshold has been met. See the discussion of the definition of "employee" in ESA Part I, s. 1 of the Manual. Included in the definition of "employee" are:
Employees of temporary help agencies are employees of the agency, so are included in the count only for the purpose of determining whether the agency has met the 25-employee threshold, not for the purpose of determining whether the client the employee is placed with has met the 25-employee threshold. Note that the agency’s count must include all of its assignment employees, whether active or inactive on January 1st.
When this “count” is being done, it is the number of employees that are counted, and not the number of "full-time equivalents". This means that part-time employees each count as one employee, regardless of the number of hours they may work. For example, an employer that employs 26 part-time employees who each work halftime has 13 full-time equivalents, but employs 26 employees for the purpose of this provision.
The question is not whether there are at least 25 employees scheduled to work or working on January 1. The question is whether the employer has an employment relationship with at least 25 employees on January 1.
The employer’s policy with respect to disconnecting from work must be in writing, which includes being electronic. Note that subsections (2) and (3) impose requirements on the employer with respect to providing a copy of the written policy to employees.
The policy must be in place before March 1st. In other words, the latest day the policy can take effect in order for the employer to be in compliance with the provision is the last day of February. (Note this is not the case during the time when the transition provisions in subsection (5) apply.)
While compliance with this provision requires the employer to have a written policy with respect to disconnecting from work in place by March 1st - and to provide a copy of the written policy to employees within the set timeframes - note that there is no contravention of Part VII.0.1 simply because the employer doesn’t put into practice what has been described in its policy.
All employees must be covered by the employer’s written policy. In other words, the employer would not be in compliance with this provision if its policy applied to only a portion of its employees – for example, if the policy applied only to the employer’s sales staff but not its managerial staff. However, this doesn’t mean that the employer is required to have the samepolicy for all of its employees. It is Program policy that the employer’s policy can be comprised of different policies (either in a single document or in multiple documents) for different individuals or different groups/classes of employees or it could be a single policy that applies to its employees across-the-board. The written policy with respect to disconnecting from work may be a stand-alone document, or it may be part of another document (e.g. a comprehensive workplace HR policies and procedures manual).
The written policy that is in place must be with respect to disconnecting from work. Section 21.1.2 does not specify what type of information the policy must contain, though subsection (4) provides that the policy must contain any information that is prescribed by regulation (no such regulations were prescribed at the time of writing).
“Disconnecting from work” is defined in section 21.1.1.
In order to be in compliance with section 21.1.2, the topic of the employer’s policy must therefore be employees not engaging in work-related communications, so as to be free from the performance of work.
This provision does not create a “right to disconnect from work” for employees. In other words, it does not impose obligations on an employer to allow employees to “disconnect from work” and to be free from the obligation to engage in work-related communications. However, it does require that the employer’s policy around “disconnecting from work” be stated in writing and provided to employees per subsections (2) and (3).
Some examples of what a “disconnecting from work” policy may address:
Note that per the ESA’s rules on when work is deemed to be performed, if an employee performs work, for example engages in reviewing or drafting emails, the time the employee spends doing those activities is generally considered to be “working time” under the ESA. This is the case even if the employee does so, for example, from home after the employee’s day shift is over and where a “disconnecting from work” policy that says employees are not to work from home is in place. See s. 1.1 of O. Reg. 285/01 for more information.
Note also that the contentof an employer policy with respect to disconnecting from work may amount to a greater right or benefit than an employment standard under the Act, per ss. 5(2) and may be enforceable under the ESA. Even if the policy does not amount to a greater right or benefit, it may otherwise be contractually binding.
The employer’s written policy must include the date it was prepared and if any changes are made to the policy after that time, the date(s) of any those change must also be included. See subsection (2) for information about the employer’s obligation to provide a copy of the written policy to all employees within 30 days of the policy being prepared or changed.
Note that per s. 15(8.1) employers have an obligation to retain a copy of every written policy on disconnecting from work that was required under this Part for three years after the policy ceases to be in effect.
Subsections 21.1.2(2) and 21.1.2(3) were introduced into the ESA by the Working for Workers Act, 2021 on December 2, 2021. These provisions establish rules about when the written policy must be provided to employees.
Pursuant to ss. 21.2.2(2), the employer must provide a copy of the written policy with respect to disconnecting from work to each of its employees within 30 days of the policy having been prepared or, if an existing policy was changed, within 30 days of the changes being made. Subsection 21.2.2(3) requires an employer to provide a copy of the written policy with respect to disconnecting from work that applies to a new employee within 30 days of that individual becoming an employee of the employer. “Days” in these subsections means calendar days.
Note that a copy of the written policy does not need to be provided to employees annually if the policy has not changed from the previous year. This is because the obligation arises only within 30 days of the policy being prepared or changed.
Where an employer has different policies for different employees or employee groups, it is Program policy that the obligation is to provide only a copy of the policy that applies to that particular employee.
It is the Program’s position that an employer may provide the policy as a printed copy or as an attachment in an email to the employee. Further, and consistent with the Program's position regarding the provision of written wage statements under s. 12(1) and the information sheets for assignment employees under s. 74.7(3), an employer may provide the written policy via a link to the document on an internet database, if the employer ensures the employee has reasonable access to that database (i.e. the employer must ensure the employee has access to a computer - which includes devices such as tablets and smart phones - and is able to access a working link to the document) and ensures the employee has access to a printer and that the employee knows how to use the computer and the printer.
An employer’s written policy with respect to disconnecting from work that is required under ss. 21.1.2(1) must contain any information that is prescribed. At the time of writing, no information is prescribed. As such, the only information the policy must include is the date it was prepared as well as the dates any changes were made to the policy, as per subsection (1). There is no other specified information that must be contained I the employer’s written policy.
This provision was added by the Working for Workers Act, 2021 (WFWA). It is a transition provision that modifies the January 1st and March 1st dates set out in subsection (1) for when the WFWA receives Royal Assent and Part VII.0.1 first comes into force (note this occurred on December 2, 2021). It provides that:
Subsection 21.1.2(5) no longer has any effect after the transition period. In other words, after 2022, the timelines set out in subsection (1) will apply: employers will take a “snapshot” of the number of employees they employ on January 1, beginning in 2023, to determine if the “25-employee threshold” is met and, if it is, they are required to have a written policy in place before March 1 of that year.
2XNSZRHZMVM4-84339534-95648 caed41fa-0972-4d1c-9936-e9fc91a7330a https://ontariogov.sharepoint.com/sites/MOL-DW/comms/_layouts/15/DocIdRedir.aspx?ID=2XNSZRHZMVM4-84339534-95648, 2XNSZRHZMVM4-84339534-95648Section 21.2 was added to the ESA effective January 1, 2019.
Prior to January 1, 2019, a different version of the three hour rule was set out in s. 5(7) of O. Reg. 285/01. That provision was revoked effective January 1, 2019 – for information about that rule, see the discussion under s. 5(7) of O. Reg. 285/01, which is being retained for transitional purposes.
Subsection 21.2(1) provides that, under certain circumstances, employees must be paid at least three hours' pay at the employee’s regular rate of pay, even though the employee has worked less than three hours. Note that employees in the women's coat and suit industry and the women's dress and sportswear industry have special rules that apply instead of s. 21.2 - see O Reg 291/01, s. 3.
The intent of Part VIII (Overtime Pay) is to compensate an employee for the additional time he or she must work when overtime is required and to provide workplace parties with the ability to negotiate more flexible work schedules. The overtime provisions are also intended to discourage employers from requiring overtime by imposing an economic cost on them when overtime is demanded.
Subject to s. 22(1.1), s. 22(1) sets out the general overtime premium of one and one-half times the employee’s regular rate of pay for each hour of overtime worked in each work week. Section 22(1) also establishes the general overtime threshold. The employer’s obligation to pay the overtime premium is triggered when an employee works more than 44 hours in a work week. Subject to a greater right or benefit, the general premium and threshold apply for all employees except those exempted from ESA Part VIII Overtime Pay. In addition, for certain employees, listed below, different overtime thresholds have been prescribed.
Subsection 22(1.1) is a new provision that the Fair Workplaces, Better Jobs Act, 2017, SO 2017, c 22, effective January 1, 2018, added to the Employment Standards Act, 2000. It states that where an employee has two or more regular rates for work performed in a work week that the overtime rate for any hour of overtime work is one and one-half times the regular rate the employee would be entitled to for the work performed in that hour.
O Reg 285/01 varies the overtime threshold for certain employees. The regulation requires employers to pay employees the general overtime premium of one and one-half times the employee’s regular rate of pay; however, it varies the overtime threshold as follows:
Employees engaged at the site of road building in relation to streets, highways or parking lots are entitled to the overtime premium for each hour of work in excess of 55 hours in each work week — O Reg 285/01, s. 13(1)(a). If the employee works less than 55 hours in a work week, the difference between the number of hours worked and 55 (up to a maximum of 22) is added on to the maximum number of hours that can be worked in the following work week before overtime becomes payable — O Reg 285/01, s. 13(1)(b).
Employees engaged at the site of road building in relation to structures such as bridges, tunnels or retaining walls in connection with streets or highways are entitled to the overtime premium for each hour of work in excess of 50 hours in each work week per O Reg 285/01, s. 13(2)(a). If the employee works less than 50 hours in a work week, the difference between the number of hours worked and 50 (up to a maximum of 22) is added on to the maximum number of hours that can be worked in the following work week before overtime becomes payable — O Reg 285/01, s. 13(2)(b).
Employees who work for the owner or operator of a hotel, motel, tourist resort, restaurant or tavern for 24 weeks or less in a calendar year and who are provided with room and board are entitled to the overtime premium for each hour worked in excess of 50 hours in a work week — O Reg 285/01, s. 14.
Seasonal employees whose employment is directly related to canning, processing and packing of fresh fruits or vegetables, or their distribution by the canner, processor or packer, are entitled to the overtime premium for each hour worked in excess of 50 hours in a work week — O Reg 285/01, s. 15.
Employees engaged in laying, altering, repairing or maintaining sewers and watermains and work incidental thereto, or in guarding the site during this work are entitled to the overtime premium for each hour worked in excess of 50 hours in a work week — O Reg 285/01, s. 16.
Employees who are drivers of, or drivers' helpers on, a vehicle used in the business of carrying goods for hire within a municipality or to any point not more than five kilometres beyond the municipality’s limits are entitled to the overtime premium for each hour worked in excess of 50 hours in a work week — O Reg 285/01, s. 17(1)(a).
Employees who drive public trucks operated by holders of an operating licence issued under the Truck Transportation Act, RSO 1990, c T.22 are entitled to the overtime premium for each hour worked in excess of 60 hours in a work week — ss. 18(1) and 18(2). Only those hours during which such employees are directly responsible for the public truck are included when calculating the entitlement to overtime — O Reg 285/01, s. 18(4).
Subsection 22(1) places a positive obligation on employers to ensure that employees receive the statutory minimum requirement with respect to overtime. An employer cannot satisfy that obligation or circumvent payment for overtime by raising any of the following defences:
In Philip’s Auto Sales and Repair Inc. v Bonneville (October 30, 1984), ESC 1726 (Betcherman), the referee affirmed that even in the event that the employer did not authorize its employees to work overtime, they are still entitled to receive the overtime pay if they exceed the overtime threshold. This decision was based on a predecessor to O Reg 285/01, s. 1.1, which stipulated that work shall be deemed to be performed when work is permitted or suffered to be done by the employer. The employer in this case was present when the employee performed the overtime work and the referee held that the employer implicitly permitted such overtime.
In Joseph Dobi Painting v Szekely and Szekely (May 28, 1980), ESC 799 (Adamson), the referee stated: "[t]he law is quite clear with respect to overtime work. The responsibility rests fully upon the employer. If he does not wish employees to work overtime, he must not only order them to stop but see that they do. This employer had ample time after the first week of employment to do this. During the period in which the employer claimed to have been incapacitated, it was still his responsibility to see that another person supervised his workers."
In Joe Kool’s Restaurants Ltd. v Whitehead et al (January 21, 1986), ESC 2023 (Brown), the work schedule prepared by the employer did not include overtime hours; however, the employees were permitted to rearrange the schedule on an individual basis to suit their own convenience, without clearing those arrangements with the employer. These informal arrangements were neither encouraged nor discouraged, and there was no advance notification to the employer. The employer argued that the overtime was not scheduled by it, nor was it worked with its knowledge or acquiescence and that the Act’s overtime provisions were therefore inapplicable. The referee rejected that argument and upheld the overtime pay assessment on the basis that the employer must have known and thus was deemed to have permitted the overtime hours worked.
An employee who is working excess hours contrary to a specific term of an employment contract or without authorization may well face disciplinary action for having done so, but that does not alter the fact that they are entitled to overtime pay for overtime hours worked.
An employer may argue that it has already compensated employees for overtime pay by providing the employee with a bonus scheme or a higher regular rate of pay. This is not a valid defence to an employee’s claim for overtime pay. The employer is also liable to pay overtime notwithstanding that the employee agreed verbally or in writing to work extra hours at the regular rate of pay. In Ferlandi Builders and Contractors Inc. v Manderscheid (May 30, 1986), ESC 2116 (Aggarwal), Jefferson Metal Products Inc. v Hazlehurst and Turner (February 20, 1985), ESC 1790 (Kerr) and Wen-Hal Limited v Hansen (August 22, 1979), ESC 660 (MacDowell), the referees held that any agreement by an employee to work overtime without receiving overtime pay for hours worked beyond 44 per week is rendered void by s. 3 of the former Employment Standards Act, now ESA Part III, s. 5(1), which specifically prohibits employees, employers and their agents from contracting out of or waiving an employment standard.
The ESA 2000 does not contain the provision that appeared in the former Employment Standards Act that specifically prohibited employers from reducing an employee’s pay to comply with the overtime provisions. However, the definition of regular rate in the ESA Part I, s. 1 makes the prohibition redundant.
Regular rate is now defined in such a way as to ensure that overtime hours shall not, in any circumstances, be used to calculate an employee’s regular rate. The regular rate for hourly employees is the amount paid for an hour of work in the employee’s usual work week — excluding overtime hours. The regular rate for non-hourly employees is the amount paid in a given work week divided by the number of non-overtime hours actually worked in that work week. For example, an employer cannot assign a regular rate of $12.00 for the first 44 hours of work in a work week and a regular rate of $8.00 thereafter.
An employer and an employee cannot agree to contract out of the overtime provisions. This is prohibited by ESA Part III, s. 5(1). An employee cannot agree to work overtime hours at a rate lower than one and one-half times their regular rate. Nor can an employee agree to reduce their regular rate for those hours worked in excess of the applicable overtime threshold.
An employer cannot avoid its obligation to pay overtime by scheduling employees to work, for example, 20 hours at one of its locations and 30 hours at a second location. In Tavares and Sgromo c.o.b. Mr. Submarine, Thunder Bay, Ontario v Coppola et al (April 13, 1982), ESC 1197 (Aggarwal), the employer had contended that since its employee did not work more than 44 hours in one location, the employee was not entitled to overtime pay. The referee, however, ruled that it was irrelevant whether the employee worked all 54.25 hours at a single location of the employer; the essential point was that the employee worked all of those hours for one employer.
Similarly, the obligation to pay overtime cannot be avoided by scheduling employees to work, for example, 25 hours for one corporation and 25 hours for another related corporation. This is prohibited by ESA Part III, s. 4, which provides as follows:
Where ESA Part III, s. 4 applies and two or more entities are treated as one employer, the hours worked by employees for those two or more entities are to be added together for purposes of determining the employees' overtime pay entitlement. See ESA Part III, s. 4 for a more detailed discussion of this issue.
The method for calculating an employee’s entitlement to overtime pay is set out below. This method applies to ALL employees who are not exempt from the application of Part VIII Overtime Pay.
The first determination that must be made is whether the person claiming overtime pay is covered by Part VIII Overtime Pay. To make this determination, the following issues must be considered:
Please note that overtime averaging agreements may also impact on a claimant’s right to overtime pay. See discussion in ESA Part VIII, s. 22(2) below.
Is it the standard 44-hour threshold, a higher threshold established by regulation, or a lower threshold established by contract?
The next issue for determination is whether the 44-hour threshold applies. A higher threshold may be prescribed by O Reg 285/01. A lower threshold may be established by contract. If the employee is engaged in any of the following, O Reg 285/01 should be consulted as a higher overtime threshold may apply:
Section 22(9) provides that when an employee performs work that is exempt from this Part and work that is not, the employee is entitled to overtime pay in respect of all of the overtime work performed in a work week so long as the non-exempt work in the work week constitutes 50% or more of the time the employee spent working.
Similarly, s. 22(9) provides that employees who perform both work that attracts overtime after 44 hours and work that attracts overtime at a higher threshold will be entitled to overtime pay after 44 hours in respect of all work performed during the work week by the employee so long as the work performed by the employee that attracts overtime pay at the 44 hour threshold constitutes 50% or more of the time the employee spent working.
See the detailed discussion of s. 22(9) below.
The standard time and one-half premium or a higher premium established by contract?
The next issue for determination is whether the time and one-half overtime premium established in s. 22(1) applies. A higher premium may be established by contract. For example, the employment contract may provide for an overtime premium of double the employee’s regular rate after 44 hours of work in a work week, or it may provide for time and one-half after 44 hours of work in a work week and double-time after 50 hours of work in a work week.
The definition of work week is critical to the calculation of an employee’s entitlement to overtime pay. An employee’s regular rate is determined with respect to a work week. Indeed, an employee’s entitlement to overtime pay is determined in respect of a work week. Therefore, one of the first determinations an officer must make is what constitutes the employee’s work week.
Work week is defined in ESA Part I, s. 1 as:
The Ontario Court of Appeal in Re Falconbridge Nickel Mines Ltd. and Egan et al., 1983 CanLII 1931 (ON CA) concluded that the term week as it was used in s. 24(1) of the former Employment Standards Act, must be interpreted as a work week. The ESA 2000 deleted the definition of week that appeared in the former Act and included an amended definition of work week to reflect the reasoning of the Court of Appeal. Part VIII Overtime Pay uses the terms week and work week interchangeably.
When determining what overtime and non-overtime hours an employee has worked in a given work week, the first question is how many hours of work were actually performed by the employee in the work week. Once the officer has determined how many hours of work were performed in the work week, they may then determine how many of these hours constitute non-overtime hours and how many are overtime hours.
When making this determination, regard must be had for O Reg 285/01, s. 1.1, which sets out when work is and is not deemed to be performed.
Section 1.1 of O Reg 285/01 provides as follows:
See O Reg 285/01, s. 1.1 for a detailed discussion of this section.
Calculation of hours worked for employees in highway transport paid by mileage
A Program investigatory tool involving mileage approximation has been used to determine the hours of work for employees employed in highway transport and paid by mileage, where no complete and accurate records of hours of work exist. The investigatory tool consists of dividing the total distance driven by 80 kilometers per hour (or 50 miles per hour). This practice can also be used as a check to assess the accuracy of existing records. Any other (i.e., non-driving) hours, if they can be established to have been worked, must also be included in the total number of hours worked. However, the hours that the employee is not directly responsible for the truck are not included for overtime purposes.
Calculation of hours worked where the employer has not kept accurate records
If an employer has not kept accurate records of the hours worked by an employee, or if the employer’s records are challenged by the employee, the employment standards officer will determine the employee’s hours of work on the basis of the best evidence available. Note that where an employee has two or more regular rates of pay that the employer is required to maintain a record of the dates and times the employee worked in excess of the overtime threshold, at each rate of pay, in any given work week. See ESA Part VI, s. 15 (1) paragraph 3.2.
Travel time
With respect to travel time it is Program policy that:
Before an employee’s overtime rate or rates in respect of the overtime hours worked in a given work week can be calculated, the employee’s regular rate or rates (if the employee is paid more than one hourly rate for work performed for the employer) for the work week(s) in question must be determined. ESA Part I, s. 1 defines regular rate as follows.
Employees who are paid solely on the basis of an hourly rate (including employees who are paid two or more different hourly rates for work performed for the employer) will fall within the first portion of this definition. All other employees, including salaried employees, flat rate mechanics, commissioned salespersons, piece workers and employees receiving mixed compensation, for example, an hourly rate and mileage or an hourly rate and commission, must have their regular rate determined by reference to clause (b) of the definition of regular rate.
An employee’s overtime rate for the overtime hours worked in any given work week is established by multiplying their regular rate by one and one-half or by the higher rate established by contract. If the employee has more than one regular rate that applies to overtime hours worked as per s. 22(1.1), the overtime rate in respect of each hour of overtime will be one and one-half times the regular rate that applies to the work performed in each hour, or the higher rate established by contract.
The overtime pay that an employee is entitled to for a given work week is determined by multiplying their overtime rate by the number of overtime hours worked at that rate within the week. Where the employee has two or more regular rates and has performed overtime work that attracts more than one overtime rate, the overtime pay for the work week is determined by adding together the overtime pay entitlement as calculated for each hour of overtime work. See example 1 under “Examples of How to Calculate Overtime” below.
The final consideration is whether the employee has already been paid, in full or in part, for any of the overtime hours in question. This will only be appropriate in limited circumstances. For example, an employee who is paid by the hour and who works 55 hours in a work week and is paid their regular rate for those 55 hours has received a portion of their overtime pay. That employee will only be entitled to an additional .5 of their regular rate in respect of all overtime hours worked in the work week.
Please note that this will not apply to a salaried employee. See the discussion below.
An employee who is paid on an hourly basis may perform, in one work week, two types of work, each of which attracts a different hourly rate. In that case, the employee has two regular rates and as a result, s. 22(1.1) applies to determine the overtime pay entitlement. That subsection provides that the overtime rate for each of hour of overtime work performed is based on the regular rate that applies to the work performed in that hour.
An employee works as a punch press operator earning $15.00/hour and also as a shipping logistics coordinator earning $20.00/hour for the same employer. The employee’s overtime threshold is 44 hours and the overtime rate is 1.5 times the regular rate.
In one work week the employee worked 4 hours of overtime. The 45th and 46th hours were worked as punch press operator and the 47th and 48th hours were worked as a shipping logistics coordinator. This employee’s overtime pay entitlement would be calculated as follows:
45th hour: overtime rate is $15.00 x1.5 = $22.50 per hour
46th hour overtime rate is $15.00 x1.5 = $22.50 per hour
47th hour overtime rate is $20.00 x1.5 = $30.00 per hour
48th hour overtime rate is $20.00 x1.5 = $30.00 per hour
The total overtime pay due to the employee is $105.00 [$22.50 + $22.50 + $30.00 + $30.00]
An employee usually works in job A at an hourly rate of $15.00. The employee also usually works, for the same employer in job B at an hourly rate of $20.00. The employer has received approval from the Director of Employment Standards under s. 17.1 to have employees work excess weekly hours. The employee has also agreed in writing to work excess hours. In one work week the employee works 60 hours: 36 hours in job A at $15.00 per hour and 24 hours in job B at $20.00 per hour. The employee was paid their regular rate or straight time for all hours worked including overtime hours; a total of $1020.
The regular overtime threshold and overtime rate of 1.5 times the regular rate apply to this employee. The 16 hours of work performed once the overtime threshold of 44 hours was reached were as follows:
The employee’s overtime entitlement in accordance with s. 22(1.1) is:
However, the employee had already been paid straight time for the 12 hours of overtime worked in job A = 12 X $15.00 per hour = $180
Plus straight time for the 4 hours of overtime worked in job B = 4 X $20.00 = $80.00
The employee’s overtime pay entitlement was $390; however the employee had already been paid $260 in straight time for the overtime hours (i.e. has received partial pay for the overtime hours). Therefore, the balance owing in respect of overtime pay for the work week in question is $390 — $260 = $130
From time to time employees who are paid an hourly rate will also perform work that involves different types of compensation in the same work week. For example, payment of an hourly rate and commission. If an employee who receives an hourly rate is also compensated with commissions, that employee, strictly speaking, is not paid by the hour. Accordingly, the regular rate of such employees must be determined by applying clause (b) of the definition of regular rate, by dividing their total earnings for each work week in question by the number of non-overtime hours worked. However, if an employee receives an hourly rate for each hour worked (including overtime hours), the employer will be credited for such payment when the employee’s overtime entitlement is calculated.
Under the ESA 2000, overtime hours cannot be included in the calculation of an employee’s regular rate.
The employee and the employer have entered into a valid written agreement under s. 17(3) for the employee to work excess weekly hours. The employee works 50 hours in a work week and is paid $20.00 per hour. The employee also receives commissions. In one work week the employee receives $1000 for 50 hours worked and $200 in respect of commissions. The general overtime premium and threshold apply.
Because this employee was paid straight time for each hour worked, including overtime hours, the employee has already received $120 (6 overtime hours x $20.00) in respect of overtime. Therefore, they entitled to receive an additional $125.46: $245.46 overtime entitlement minus $120 of overtime already paid, in respect of overtime for the work week in question.
Under the ESA 2000, the overtime entitlement for employees who are paid solely on a mileage basis, by commission or on a piece-rate must be determined by reference to the definition of regular rate in ESA Part I, s. 1. Because these employees are not paid by the hour, their regular rate must be determined by applying clause (b) of the definition of regular rate, by dividing all earned wages in the work week by the non-overtime hours worked. The overtime premium of one and one-half times the regular rate is payable for all hours worked in excess of 44 in a work week, unless a higher overtime rate applies by virtue of contract or a higher threshold applies by virtue of regulation.
An employee works making oven mitts and is paid $2.50 per pair. In a particular work week, the employee works 60 hours to make 300 pairs of mitts and is paid $750.00. The employee and the employer have entered into a valid written agreement under s. 17(3) for the employee to work excess weekly hours. . The general threshold and premium apply to the employee.
Enquiries arise occasionally on the application of the legislation to motor vehicle mechanics and body repairpersons who are paid on a flat rate or incentive system. In a flat rate shop, every job is rated as taking a certain number of hours to perform and the mechanic is paid a book hourly rate for those hours. As an example, a brake reline is rated as a four-hour job, and the mechanic's book rate is $16 per hour. The mechanic will be paid $64 whether the job takes three or five hours to complete. This is acceptable so long as the minimum wage standard (compliance with which is determined on a pay period basis) is met and all overtime hours (hours worked in excess of 44) are compensated at a minimum of 1.5 times the mechanic's actual regular rate, which is not the same as the flat rate.
Generally, in a flat-rate remuneration system, it is a condition of employment that the employee rectify their own faulty work without further pay. This is not a violation of the ESA 2000, so long as the minimum wage and overtime provisions are not violated. If for some reason another mechanic makes the required changes, the payment for the entire job may be credited to the second mechanic. Where this occurs as part of the employment contract, the transfer of credits is considered as part of the reconciliation of wages due and not a prohibited set-off or deduction. However, the minimum wage and overtime provisions still apply with respect to the hours of work the first mechanic spent on the vehicle.
It is essential in a flat rate system that the employer's records reflect both the flat rate paid and the actual hours worked: it is the actual hours worked (and any work deemed to have been performed pursuant to O. Reg. 285/01, s. 1.1) that must be used to calculate the employee's regular rate and overtime entitlements. Those hours of work must include any time spent rectifying the employee's faulty work.
As illustrated in the examples below, payment at the book rate is payment for a task (i.e., a flat rate for the task), rather than a payment for hours actually worked. As no portion of the payment is made in respect of hours actually worked, none of it can be considered to be a payment for regular hours or overtime hours.
The employee is paid a flat book rate of $16.00 per hour for brake re-lining. The employee did 12 brake-relines which resulted in a flat rate payment for 48 hours (each re-line job is rated as taking 4 hours) for a total payment of $768. The employee however actually spent 46 hours doing the work in that week. The general overtime rate and threshold apply to this employee.
In this case, the employer owes the employee an additional $52.36 for overtime pay.
The employee is paid a flat book rate of $16.00 per hour to perform tune-ups that according to the book will take 1.5 hours to complete. In fact the employee is being paid $24.00 for each tune-up regardless of the time it actually took to perform the tune-up. Having completed 25 tune-ups in one week the employee is paid $600 for that work week. However, the employee actually worked 50 hours in that work week. The general overtime rate and threshold apply to this employee.
In this case, the employer owes the employee an additional $122.76 for overtime pay.
Generally, employees who are paid a fixed amount for each pay period rather than an amount determined by applying an hourly rate to each hour worked (or a piece rate or commission based on work performed) are considered to be salaried employees. It should be noted that although ESA Part VI, s. 15(4) defines a salaried employee, that definition is for the purposes of ESA Part VI, s. 15(3), which sets out the employer’s obligations to record hours worked, and is not necessarily relevant to the calculation of overtime entitlements.
Salaried employees who are not exempt from the overtime provisions are entitled to overtime pay for overtime work. Once the work week has been determined, the employee’s regular rate will be determined by applying clause (b) of the definition of regular rate, by dividing the salary earned in respect of the work week by the number of non-overtime hours worked in the work week. Salaried employees are entitled to receive 1.5 times their regular rate in respect of each hour worked in excess of 44 in a work week (or other applicable threshold).
Prior to the introduction the ESA 2000, the calculation of the regular rate for salaried employees was accomplished by dividing the salary earned for the work week by the actual hours worked, including overtime hours. The employee was considered to have been paid straight time for all hours worked, including overtime hours, and received an additional .5 times their regular rate in respect of all overtime hours worked in the work week in question. This method of calculating overtime had the effect of lowering the employee’s regular rate as the number of hours worked increased and significantly reducing the employee’s entitlement to overtime pay.
Under the ESA 2000, overtime hours cannot be included in the calculation of an employee’s regular rate. Formerly, the more overtime hours a salaried employee worked, the less they were paid for those hours. The new definition of regular rate precludes that result because overtime hours cannot be included in the calculation.
An employee is paid an annual salary of $52,000 or $1000 per week. The employee works 60 hours in a work week. The employee and the employer have entered into a valid written agreement under s. 17(3) for the employee to work excess weekly hours. The general overtime rate and threshold apply.
The employee’s entitlement to overtime pay for the work week is $34.10 x 16 hours = $545.60.
Subsection 22(2) was amended effective April 3, 2019 by the Restoring Ontario’s Competitiveness Act, 2019 (ROCA). ROCA removed the previous requirement to obtain the Director of Employment Standards’ approval as a condition for averaging and imposed a four-week limit on the length of averaging agreements.
Where the conditions set out in this provision are met, the employer's obligation to pay overtime pay is based on the employee's average hours per work week during the period specified in the employee's averaging agreement (which cannot exceed four weeks), rather than the hours actually worked within a work week.
An employee and employer have agreed in writing to average hours over four-week periods for the purpose of calculating the employee's entitlement to overtime pay. The employee works 48 hours in the first week, 44 hours in the second week, 40 hours in the third week and 50 hours in the fourth week. The employee and employer also have a valid written agreement for the employee to work excess weekly hours.
The employee’s overtime hours will be determined on the basis of the average number of hours worked per week. In this example the employee worked an average of 45.5 hours per week (48 + 44 + 40 + 50, divided by 4). Accordingly, the employee would be entitled to overtime pay for six hours based on an average of 1.5 hours of overtime per week in the four-week period. In the absence of averaging, the employee would have been entitled to four hours of overtime pay in the first week and six hours of overtime pay in the fourth week.
Note that, unless there is a time off in lieu arrangement in place pursuant to s. 22(7), the employer is required to pay the employee straight time for every hour worked within each pay period — including those hours over 44 - and that it is only the extra half that the employer can postpone paying under an averaging arrangement until the end of the averaging period. See ESA Part V, s. 11 for details.
Section 22(2) provides that where averaging is permitted, the employee’s hours of work can be averaged only over separate, non-overlapping, contiguous periods of two or more consecutive weeks. That is, the averaging periods must be contiguous (i.e., there cannot be gaps in between the end of one period and the beginning of another), and they must be separate and cannot overlap with one another. Further, the two or more weeks within each averaging period must be consecutive. The longest averaging period permitted under the Act is four weeks.
Note that even if an employer has averaging agreements and an averaging approval, if employees will be working hours in excess of the daily or weekly limits the employer must also obtain excess hours agreements from the employees.
Before averaging can take place are discussed below.
Before an employer is permitted to average an employee's hours, the employee must have entered into an agreement with the employer allowing his or her hours to be averaged over periods of a specified number of weeks.
For an agreement to valid, the following criteria must be met:
By virtue of ESA Part 1, s. 1(3), an agreement between an employer and an employee to average the employee’s hours of work, for purposes of calculating the employee’s entitlement to overtime pay must be in writing. See also ESA Part 1, s. 1(3.1), which provides that an agreement in writing may be in electronic form.
For employees represented by a trade union, the written agreement may be embodied in the collective agreement or a memorandum of agreement or other written documentation signed by union officials and, provided the other criteria are met, all bargaining unit employees will be bound by the agreement.
In the non-unionized context, a written agreement between each employee whose hours are to be averaged and the employer is required.
Section 22(2)(a) requires that the agreement state specifically the number of weeks over which the hours of work are going to be averaged. Statements such as "up to 4 weeks" are not sufficient.
Section 22(2)(b) provides that the averaging period cannot exceed four weeks or the number of weeks specified in the agreement, whichever is lower. In other words, employees and employers can agree to average hours over periods of 2 weeks, 3 weeks, or 4 weeks. Four weeks is the maximum period over which the hours of work may be averaged for overtime pay entitlement purposes.
For example, an employee agreed to average her hours of work over a period of three weeks. The employer can average the employee's hours only over a period of three weeks, not over the four-week maximum as set out in subsection 22(2)(b).
An agreement that purports to average hours over a period of longer than four weeks is invalid.
Section 22(3) provides that, subject to ss. (3.1) and (3.2), an averaging agreement is not valid unless it contains a start date and an expiry date.
With respect to the start date: if the agreement does not contain a start date it is invalid and as a result averaging of hours cannot take place.
With respect to the end date:
The agreement should be written with sufficient clarity for the parties to know precisely what they are agreeing to.
The agreement should contain the employee’s express consent to the averaging of hours for the purpose of calculating the employee’s entitlement, if any, to overtime pay. Mere agreement to a particular schedule is not sufficient, as an employee may agree to work certain hours without necessarily having agreed to the hours being averaged for overtime pay purposes.
Employers are encouraged, but not required, to include schedules in averaging agreements.
Overtime averaging agreements must not be confused with agreements to work hours in excess of the weekly and daily maximums established in ESA Part VII, s. 17. Employers who wish employees to work hours in excess of eight hours a day (or the regular work day where that is longer than eight hours) or 48 hours a week must secure valid written agreements from their employees (which includes providing the employees the statutory information document — see s. 17(5) for details) ) to work hours in excess of the daily and weekly maximums. The overtime averaging and excess hours agreements may be contained in separate documents, or in the same one.
An averaging agreement will not be binding if it is not entered into voluntarily by both parties. Please see ESA Part I, s. 1(3) for a more detailed discussion of the issue of voluntary consent.
The employee must understand what is being agreed to, and the consequences of the agreement, for an averaging agreement to be binding. Informed consent will not be established unless each party knows precisely the ramifications of entering into the agreement.
The best evidence that an employee provided informed consent is where the document itself accurately sets out the consequences of the agreement. To this end, employers may wish to include the following in averaging agreements:
See s. 22(6) below for a more detailed discussion of these requirements.
The Ministry has produced a list of items employers and employees may wish to consider when drafting agreements. This can be found on the Ministry of Labour’s website.
In the absence of a valid agreement, the employer must pay the employee overtime pay according to s. 22(1), or ensure that the employee does not work overtime.
Employers are required to retain a copy of every averaging agreement it has made with its employees for three years after the last day on which work was performed under each agreement — see ESA Part VI, s. 15(9).
If an employee does not agree to the averaging of their hours for purposes of determining overtime pay entitlements, if any, the employer must pay the employee overtime pay according to s. 22(1), or ensure that the employee does not work overtime (that is, hours in excess of 44 hours per week or other applicable threshold). If an employer terminates the employment of an employee, or disciplines or otherwise penalizes an employee because the employee refused to consent to the averaging agreement, that employer will have committed a reprisal in violation of ESA Part XVIII, s. 74.
Employers may wish to have averaging arrangements in place in order to provide employees with increased flexibility in their work schedules by allowing shift exchanges, without the requirement of paying overtime as a consequence of the shift exchanges.
Example: A three-week averaging arrangement is in place and:
An issue that may arise in the context of an averaging agreement made for the purpose of accommodating shift exchanges is how to handle circumstances in which the employment of an employee who has been involved in a shift exchange ends before the exchange is complete. The following example illustrates the Program’s policy on this matter.
Example
The employees and the employer have agreed in writing to average hours of work over a period of four weeks for purposes of calculating overtime pay. Employees are paid weekly. Employee A agrees to work a shift for Employee B in week one of the averaging period. In exchange, Employee B agrees to work a shift for Employee A in week two of the averaging period; however, Employee B's employment is terminated before she can complete the shift exchange. The employees are paid their regular wages in respect of week one and week two.
The employer owes Employee A straight time for the shift she worked in week one for Employee B and in respect of which Employee A has not been compensated.
Employee B owes the employer the regular wages that she was paid for work that she did not perform in week one. Employee B is considered to have received an advance and therefore, the employer may make a reconciliation for this amount. Such a reconciliation is not considered to be a set-off or deduction as defined in ESA Part V, s. 13.
Section 22(2.2) is a transitional provision relating to amendments made to the ESA in 2005. (See s. 22(5) below for the transitional provision relating to amendments made to the ESA in April, 2019.)
With respect to agreements made under the ESA 2000, paragraph 2 refers to agreements made under s. 22 as it read on February 28, 2005, i.e., agreements to average over periods of up to four weeks, while paragraph 3 refers to agreements made under O Reg 285/01, s. 30, i.e., agreements to average over period of more than four weeks. At the time, only the latter required the approval of the Director. In the case of all three types of averaging agreements, this provision states that such agreements are to be treated as if they were agreements under s. 22(2)(a).
On February 28, 2005 the relevant provisions read as follows:
Section 22(2) of the ESA 2000:
Section 30 of O Reg 285/01:
By virtue of s. 22(2.2), agreements that were entered into under s. 22(2) or O Reg 285/01, s. 30 as they read on February 28, 2005 under the former Employment Standards Act that are still valid are treated as if they are agreements made under the current s. 22(2)(a) (new agreements), thereby avoiding the need for employers to enter into another agreement with employees if they wished to average hours after February 28, 2005. However, employers who had old, pre-February 28, 2005 agreements with employees were required to seek approval from the Director before the employer could average employees' hours of work. This was so even if the Director had approved the agreement pursuant to O Reg 285/01, s. 30 - see s. 22.1(18), which specifically provides that any approval granted by the Director under the regulation ceases to have effect on March 1, 2005. Note: As of April 3, 2019, Director approval is no longer necessary for averaging agreements to be valid.
The rules established in these subsections apply only to agreements entered into on or after April 3, 2019, the date that the Restoring Ontario’s Competitiveness Act, 2019 received Royal Assent. See ss. 22(5) below for the rules re: agreements that were made prior to April 3, 2019.
Section 22(3) provides that, subject to ss. (3.1) and (3.2), an averaging agreement is not valid unless it contains a start date and an expiry date.
With respect to the start date: if the agreement does not contain a start date it is invalid and as a result averaging of hours cannot take place.
With respect to the end date:
For employees represented by a trade union, the written averaging agreement may be embodied in the collective agreement, a memorandum of agreement or an addendum to an agreement. The terms of the averaging agreement determine which of the bargaining unit employees are bound by it. (For example, it could be all employees in the bargaining unit or only select groups of employees in the bargaining unit.)
The averaging agreement may contain a specific end date, or it may reference an event. For example, it may say that the agreement expires when the collective agreement expires, or it may say that it expires on the day a subsequent collective agreement comes into effect (it is not uncommon for there to be a period of time in between the date a collective agreement expires and the date the subsequent collective agreement comes into operation Note that the rule re: the expiry date in ss. (3.2) is triggered and fixed if the conditions of the employee being represented by a trade union and covered by a collective agreement were present at the time the averaging agreement was entered into.
This provision clarifies that averaging agreements may, before or upon their expiry be renewed or replaced, provided the requirements set out in section 22 are met
Prior to the ROCA amendments, an employee’s hours could be averaged only if the employee agreed in writing to the averaging and only if the Director of Employment Standards approved the agreement. ROCA removed the requirement for the approval of the Director and limited the length of averaging agreements to four weeks.
This provision states that valid averaging agreements entered into and approved by the Director of Employment Standards prior to the Restoring Ontario’s Competitiveness Act, 2019 receiving Royal Assent (April 3, 2019), are deemed to meet the requirements of this section and remain valid and in force until the earlier of the following events:
This provision applies only to agreements that were entered into and approved by the Director of Employment Standards prior to April 3, 2019 Agreements entered into on or after April 3, 2019 are governed by the rules regarding expiry dates that are set out in s. 22(3.2)
This provision applies to Director-approved averaging agreements of any length, including those that exceed the current maximum length of four weeks.
The ESA 2000 introduced this provision to ensure that once an averaging agreement is made, it cannot be unilaterally cancelled or revoked by the employer, the employee or their agents. Averaging agreements can only be revoked by the parties if the employer and the employee agree to do so in writing, in accordance with ESA Part 1, s. 1(3). The purpose of this provision is to provide the parties with a degree of certainty.
The provision permits an employer and an employee to agree, in writing, that the employee be compensated for some or all overtime hours by receiving one and one-half hours of paid time off work for each hour worked in excess of 44 (or other applicable threshold) instead of receiving overtime pay if the following criteria are met:
Please see ESA Part I, s. 1(3) and (3.1) for a more detailed discussion.
Because the subsection states that the employee is to be compensated for overtime hours with one and one-half hours of paid time off work for each hour of overtime worked instead of overtime pay, it is the Program's position that the employee is entitled to the time off at the rate the employee is earning when the employee takes the time off as opposed to the rate they were earning when the overtime was worked. Note, however, that if the employee’s employment ends before the time off can be taken, the employer will be required to pay overtime pay based on the rate the employee was earning when the overtime was worked. See the discussion at s. 22(8) below.
This provision stipulates that if the employee’s employment ends before the lieu time earned pursuant to s. 22(7) is taken, the employee’s lieu time entitlement automatically converts into an entitlement to overtime pay. Pursuant to s. 11(5), the overtime pay is payable to the employee by the later of seven days after the termination of the employee’s employment or on what would have been the employee’s next pay day. Note that because this provision requires that the employer pay the employee overtime pay for the overtime hours that were worked, it is the Program’s position that the overtime pay the employee is entitled to receive is based on the rate the employee was earning when the overtime was worked as opposed to the rate they were earning when the termination occurred.
The purpose of this provision is twofold. This provision ensures that:
While s. 22(9) does not address the situation of employees who perform work for which the regulations prescribe differing overtime thresholds, it is Program policy to apply the principle behind that subsection by analogy to their situation. Thus, such employees are considered by the Program to be entitled to overtime pay for all hours worked in excess of the lower threshold provided that at least 50% of their work week is spent performing work that attracts the lower threshold. For example, employees who perform work that attracts overtime after 50 or 60 hours (local cartage and highway transport respectively) as per O Reg 285/01, ss. 17 and 18 would be entitled to overtime for all hours in excess of 50 in a week if at least 50% of the hours worked in the week were in local cartage.
The “overtime averaging” scheme set out in the ESA 2000 was amended effective April 3, 2019 as a result of the Restoring Ontario’s Competitiveness Act, 2019. The provisions that are currently in force are discussed in the section above. The text below, which appears in red, is the legislative text and the associated operational policy as it applied prior to April 3, 2019. This discussion is being maintained in this publication since employees may still file a complaint relating to a situation that arose when the below provisions were in force.
Subject to s. 22(1.1), s. 22(1) sets out the general overtime premium of one and one-half times the employee’s regular rate of pay for each hour of overtime worked in each work week. Section 22(1) also establishes the general overtime threshold. The employer’s obligation to pay the overtime premium is triggered when an employee works more than 44 hours in a work week. Subject to a greater right or benefit, the general premium and threshold apply for all employees except those exempted from ESA Part VIII Overtime Pay. In addition, for certain employees, listed below, different overtime thresholds have been prescribed.
Subsection 22(1.1) is a new provision that the Fair Workplaces, Better Jobs Act, 2017, SO 2017, c 22, effective January 1, 2018, added to the Employment Standards Act, 2000. It states that where an employee has two or more regular rates for work performed in a work week that the overtime rate for any hour of overtime work is one and one-half times the regular rate the employee would be entitled to for the work performed in that hour.
O Reg 285/01 varies the overtime threshold for certain employees. The regulation requires employers to pay employees the general overtime premium of one and one-half times the employee’s regular rate of pay; however, it varies the overtime threshold as follows:
Employees engaged at the site of road building in relation to streets, highways or parking lots are entitled to the overtime premium for each hour of work in excess of 55 hours in each work week – O Reg 285/01, s. 13(1)(a). If the employee works less than 55 hours in a work week, the difference between the number of hours worked and 55 (up to a maximum of 22) is added on to the maximum number of hours that can be worked in the following work week before overtime becomes payable — O Reg 285/01, s. 13(1)(b).
Employees engaged at the site of road building in relation to structures such as bridges, tunnels or retaining walls in connection with streets or highways are entitled to the overtime premium for each hour of work in excess of 50 hours in each work week per O Reg 285/01, s. 13(2)(a). If the employee works less than 50 hours in a work week, the difference between the number of hours worked and 50 (up to a maximum of 22) is added on to the maximum number of hours that can be worked in the following work week before overtime becomes payable – O Reg 285/01, s. 13(2)(b).
Employees who work for the owner or operator of a hotel, motel, tourist resort, restaurant or tavern for 24 weeks or less in a calendar year and who are provided with room and board are entitled to the overtime premium for each hour worked in excess of 50 hours in a work week – O Reg 285/01, s. 14.
Seasonal employees whose employment is directly related to canning, processing and packing of fresh fruits or vegetables, or their distribution by the canner, processor or packer, are entitled to the overtime premium for each hour worked in excess of 50 hours in a work week – O Reg 285/01, s. 15.
Employees engaged in laying, altering, repairing or maintaining sewers and watermains and work incidental thereto, or in guarding the site during this work are entitled to the overtime premium for each hour worked in excess of 50 hours in a work week – O Reg 285/01, s. 16.
Employees who are drivers of, or drivers' helpers on, a vehicle used in the business of carrying goods for hire within a municipality or to any point not more than five kilometres beyond the municipality’s limits are entitled to the overtime premium for each hour worked in excess of 50 hours in a work week – O Reg 285/01, s. 17(1)(a).
Employees who drive public trucks operated by holders of an operating licence issued under the Truck Transportation Act, RSO 1990, c T.22 are entitled to the overtime premium for each hour worked in excess of 60 hours in a work week — ss. 18(1) and 18(2). Only those hours during which such employees are directly responsible for the public truck are included when calculating the entitlement to overtime – O Reg 285/01, s. 18(4).
Subsection 22(1) places a positive obligation on employers to ensure that employees receive the statutory minimum requirement with respect to overtime. An employer cannot satisfy that obligation or circumvent payment for overtime by raising any of the following defences:
In Philip’s Auto Sales and Repair Inc. v Bonneville (October 30, 1984), ESC 1726 (Betcherman), the referee affirmed that even in the event that the employer did not authorize its employees to work overtime, they are still entitled to receive the overtime pay if they exceed the overtime threshold. This decision was based on a predecessor to O Reg 285/01, s. 1.1, which stipulated that work shall be deemed to be performed when work is permitted or suffered to be done by the employer. The employer in this case was present when the employee performed the overtime work and the referee held that the employer implicitly permitted such overtime.
In Joseph Dobi Painting v Szekely and Szekely (May 28, 1980), ESC 799 (Adamson), the referee stated: "[t]he law is quite clear with respect to overtime work. The responsibility rests fully upon the employer. If he does not wish employees to work overtime, he must not only order them to stop but see that they do. This employer had ample time after the first week of employment to do this. During the period in which the employer claimed to have been incapacitated, it was still his responsibility to see that another person supervised his workers."
In Joe Kool’s Restaurants Ltd. v Whitehead et al (January 21, 1986), ESC 2023 (Brown), the work schedule prepared by the employer did not include overtime hours; however, the employees were permitted to rearrange the schedule on an individual basis to suit their own convenience, without clearing those arrangements with the employer. These informal arrangements were neither encouraged nor discouraged, and there was no advance notification to the employer. The employer argued that the overtime was not scheduled by it, nor was it worked with its knowledge or acquiescence and that the Act’s overtime provisions were therefore inapplicable. The referee rejected that argument and upheld the overtime pay assessment on the basis that the employer must have known and thus was deemed to have permitted the overtime hours worked.
An employee who is working excess hours contrary to a specific term of an employment contract or without authorization may well face disciplinary action for having done so, but that does not alter the fact that they are entitled to overtime pay for overtime hours worked.
An employer may argue that it has already compensated employees for overtime pay by providing the employee with a bonus scheme or a higher regular rate of pay. This is not a valid defence to an employee’s claim for overtime pay. The employer is also liable to pay overtime notwithstanding that the employee agreed verbally or in writing to work extra hours at the regular rate of pay. In Ferlandi Builders and Contractors Inc. v Manderscheid (May 30, 1986), ESC 2116 (Aggarwal), Jefferson Metal Products Inc. v Hazlehurst and Turner (February 20, 1985), ESC 1790 (Kerr) and Wen-Hal Limited v Hansen (August 22, 1979), ESC 660 (MacDowell), the referees held that any agreement by an employee to work overtime without receiving overtime pay for hours worked beyond 44 per week is rendered void by s. 3 of the former Employment Standards Act, now ESA Part III, s. 5(1), which specifically prohibits employees, employers and their agents from contracting out of or waiving an employment standard.
The ESA 2000 does not contain the provision that appeared in the former Employment Standards Act that specifically prohibited employers from reducing an employee’s pay to comply with the overtime provisions. However, the definition of regular rate in the ESA Part I, s. 1 makes the prohibition redundant.
Regular rate is now defined in such a way as to ensure that overtime hours shall not, in any circumstances, be used to calculate an employee’s regular rate. The regular rate for hourly employees is the amount paid for an hour of work in the employee’s usual work week — excluding overtime hours. The regular rate for non-hourly employees is the amount paid in a given work week divided by the number of non-overtime hours actually worked in that work week. For example, an employer cannot assign a regular rate of $12.00 for the first 44 hours of work in a work week and a regular rate of $8.00 thereafter.
An employer and an employee cannot agree to contract out of the overtime provisions. This is prohibited by ESA Part III, s. 5(1). An employee cannot agree to work overtime hours at a rate lower than one and one-half times their regular rate. Nor can an employee agree to reduce their regular rate for those hours worked in excess of the applicable overtime threshold.
An employer cannot avoid its obligation to pay overtime by scheduling employees to work, for example, 20 hours at one of its locations and 30 hours at a second location. In Tavares and Sgromo c.o.b. Mr. Submarine, Thunder Bay, Ontario v Coppola et al (April 13, 1982), ESC 1197 (Aggarwal), the employer had contended that since its employee did not work more than 44 hours in one location, the employee was not entitled to overtime pay. The referee, however, ruled that it was irrelevant whether the employee worked all 54.25 hours at a single location of the employer; the essential point was that the employee worked all of those hours for one employer.
Similarly, the obligation to pay overtime cannot be avoided by scheduling employees to work, for example, 25 hours for one corporation and 25 hours for another related corporation. This is prohibited by ESA Part III, s. 4, which provides as follows:
Where ESA Part III, s. 4 applies and two or more entities are treated as one employer, the hours worked by employees for those two or more entities are to be added together for purposes of determining the employees' overtime pay entitlement. See ESA Part III, s. 4 for a more detailed discussion of this issue.
The method for calculating an employee’s entitlement to overtime pay is set out below. This method applies to ALL employees who are not exempt from the application of Part VIII Overtime Pay.
The first determination that must be made is whether the person claiming overtime pay is covered by Part VIII Overtime Pay. To make this determination, the following issues must be considered:
Please note that overtime averaging agreements may also impact on a claimant’s right to overtime pay. See discussion in ESA Part VIII, s. 22(2) below.
Is it the standard 44-hour threshold, a higher threshold established by regulation, or a lower threshold established by contract?
The next issue for determination is whether the 44-hour threshold applies. A higher threshold may be prescribed by O Reg 285/01. A lower threshold may be established by contract. If the employee is engaged in any of the following, O Reg 285/01 should be consulted as a higher overtime threshold may apply:
Section 22(9) provides that when an employee performs work that is exempt from this Part and work that is not, the employee is entitled to overtime pay in respect of all of the overtime work performed in a work week so long as the non-exempt work in the work week constitutes 50% or more of the time the employee spent working.
Similarly, s. 22(9) provides that employees who perform both work that attracts overtime after 44 hours and work that attracts overtime at a higher threshold will be entitled to overtime pay after 44 hours in respect of all work performed during the work week by the employee so long as the work performed by the employee that attracts overtime pay at the 44 hour threshold constitutes 50% or more of the time the employee spent working.
See the detailed discussion of s. 22(9) below.
The standard time and one-half premium or a higher premium established by contract?
The next issue for determination is whether the time and one-half overtime premium established in s. 22(1) applies. A higher premium may be established by contract. For example, the employment contract may provide for an overtime premium of double the employee’s regular rate after 44 hours of work in a work week, or it may provide for time and one-half after 44 hours of work in a work week and double-time after 50 hours of work in a work week.
The definition of work week is critical to the calculation of an employee’s entitlement to overtime pay. An employee’s regular rate is determined with respect to a work week. Indeed, an employee’s entitlement to overtime pay is determined in respect of a work week. Therefore, one of the first determinations an officer must make is what constitutes the employee’s work week.
Work week is defined in ESA Part I, s. 1 as:
The Ontario Court of Appeal in Re Falconbridge Nickel Mines Ltd. and Egan et al., 1983 CanLII 1931 (ON CA) concluded that the term week as it was used in s. 24(1) of the former Employment Standards Act, must be interpreted as a work week. The ESA 2000 deleted the definition of week that appeared in the former Act and included an amended definition of work week to reflect the reasoning of the Court of Appeal. Part VIII Overtime Pay uses the terms week and work week interchangeably.
When determining what overtime and non-overtime hours an employee has worked in a given work week, the first question is how many hours of work were actually performed by the employee in the work week. Once the officer has determined how many hours of work were performed in the work week, they may then determine how many of these hours constitute non-overtime hours and how many are overtime hours.
When making this determination, regard must be had for O Reg 285/01, s. 1.1, which sets out when work is and is not deemed to be performed.
Section 1.1 of O Reg 285/01 provides as follows:
See O Reg 285/01, s. 1.1 for a detailed discussion of this section.
Calculation of hours worked for employees in highway transport paid by mileage
A Program investigatory tool involving mileage approximation has been used to determine the hours of work for employees employed in highway transport and paid by mileage, where no complete and accurate records of hours of work exist. The investigatory tool consists of dividing the total distance driven by 80 kilometers per hour (or 50 miles per hour). This practice can also be used as a check to assess the accuracy of existing records. Any other (i.e., non-driving) hours, if they can be established to have been worked, must also be included in the total number of hours worked. However, the hours that the employee is not directly responsible for the truck are not included for overtime purposes.
Calculation of hours worked where the employer has not kept accurate records
If an employer has not kept accurate records of the hours worked by an employee, or if the employer’s records are challenged by the employee, the employment standards officer will determine the employee’s hours of work on the basis of the best evidence available. Note that where an employee has two or more regular rates of pay that the employer is required to maintain a record of the dates and times the employee worked in excess of the overtime threshold, at each rate of pay, in any given work week. See ESA Part VI, s. 15 (1) paragraph 3.2.
Travel time
With respect to travel time it is Program policy that:
Before an employee’s overtime rate or rates in respect of the overtime hours worked in a given work week can be calculated, the employee’s regular rate or rates (if the employee is paid more than one hourly rate for work performed for the employer) for the work week(s) in question must be determined. ESA Part I, s. 1 defines regular rate as follows.
Employees who are paid solely on the basis of an hourly rate (including employees who are paid two or more different hourly rates for work performed for the employer) will fall within the first portion of this definition. All other employees, including salaried employees, flat rate mechanics, commissioned salespersons, piece workers and employees receiving mixed compensation, for example, an hourly rate and mileage or an hourly rate and commission, must have their regular rate determined by reference to clause (b) of the definition of regular rate.
An employee’s overtime rate for the overtime hours worked in any given work week is established by multiplying their regular rate by one and one-half or by the higher rate established by contract. If the employee has more than one regular rate that applies to overtime hours worked as per s. 22(1.1), the overtime rate in respect of each hour of overtime will be one and one-half times the regular rate that applies to the work performed in each hour, or the higher rate established by contract.
The overtime pay that an employee is entitled to for a given work week is determined by multiplying their overtime rate by the number of overtime hours worked at that rate within the week. Where the employee has two or more regular rates and has performed overtime work that attracts more than one overtime rate, the overtime pay for the work week is determined by adding together the overtime pay entitlement as calculated for each hour of overtime work. See example 1 under “Examples of How to Calculate Overtime” below.
The final consideration is whether the employee has already been paid, in full or in part, for any of the overtime hours in question. This will only be appropriate in limited circumstances. For example, an employee who is paid by the hour and who works 55 hours in a work week and is paid their regular rate for those 55 hours has received a portion of their overtime pay. That employee will only be entitled to an additional .5 of their regular rate in respect of all overtime hours worked in the work week.
Please note that this will not apply to a salaried employee. See the discussion below.
An employee who is paid on an hourly basis may perform, in one work week, two types of work, each of which attracts a different hourly rate. In that case, the employee has two regular rates and as a result, s. 22(1.1) applies to determine the overtime pay entitlement. That subsection provides that the overtime rate for each of hour of overtime work performed is based on the regular rate that applies to the work performed in that hour.
An employee works as a punch press operator earning $15.00/hour and also as a shipping logistics coordinator earning $20.00/hour for the same employer. The employee’s overtime threshold is 44 hours and the overtime rate is 1.5 times the regular rate.
In one work week the employee worked 4 hours of overtime. The 45th and 46th hours were worked as punch press operator and the 47th and 48th hours were worked as a shipping logistics coordinator. This employee’s overtime pay entitlement would be calculated as follows:
45th hour: overtime rate is $15.00 x1.5 = $22.50 per hour
46th hour overtime rate is $15.00 x1.5 = $22.50 per hour
47th hour overtime rate is $20.00 x1.5 = $30.00 per hour
48th hour overtime rate is $20.00 x1.5 = $30.00 per hour
The total overtime pay due to the employee is $105.00 [$22.50 + $22.50 + $30.00 + $30.00]
An employee usually works in job A at an hourly rate of $15.00. The employee also usually works, for the same employer in job B at an hourly rate of $20.00. The employer has received approval from the Director of Employment Standards under s. 17.1 to have employees work excess weekly hours. The employee has also agreed in writing to work excess hours. In one work week the employee works 60 hours: 36 hours in job A at $15.00 per hour and 24 hours in job B at $20.00 per hour. The employee was paid their regular rate or straight time for all hours worked including overtime hours; a total of $1020.
The regular overtime threshold and overtime rate of 1.5 times the regular rate apply to this employee. The 16 hours of work performed once the overtime threshold of 44 hours was reached were as follows:
The employee’s overtime entitlement in accordance with s. 22(1.1) is:
However, the employee had already been paid straight time for the 12 hours of overtime worked in job A = 12 X $15.00 per hour = $180
Plus straight time for the 4 hours of overtime worked in job B = 4 X $20.00 = $80.00
The employee’s overtime pay entitlement was $390; however the employee had already been paid $260 in straight time for the overtime hours (i.e. has received partial pay for the overtime hours). Therefore, the balance owing in respect of overtime pay for the work week in question is $390 — $260 = $130
From time to time employees who are paid an hourly rate will also perform work that involves different types of compensation in the same work week. For example, payment of an hourly rate and commission. If an employee who receives an hourly rate is also compensated with commissions, that employee, strictly speaking, is not paid by the hour. Accordingly, the regular rate of such employees must be determined by applying clause (b) of the definition of regular rate, by dividing their total earnings for each work week in question by the number of non-overtime hours worked. However, if an employee receives an hourly rate for each hour worked (including overtime hours), the employer will be credited for such payment when the employee’s overtime entitlement is calculated.
Under the ESA 2000, overtime hours cannot be included in the calculation of an employee’s regular rate.
The employee works 50 hours in a work week and is paid $20.00 per hour. The employer has received approval from the Director of Employment Standards under s. 17.1 to have employees work excess weekly hours. The employee has also agreed in writing to work excess hours. The employee also receives commissions. In one work week the employee receives $1000 for 50 hours worked and $200 in respect of commissions. The general overtime premium and threshold apply.
Because this employee was paid straight time for each hour worked, including overtime hours, the employee has already received $120 (6 overtime hours x $20.00) in respect of overtime. Therefore, they entitled to receive an additional $125.46: $245.46 overtime entitlement minus $120 of overtime already paid, in respect of overtime for the work week in question.
Under the ESA 2000, the overtime entitlement for employees who are paid solely on a mileage basis, by commission or on a piece-rate must be determined by reference to the definition of regular rate in ESA Part I, s. 1. Because these employees are not paid by the hour, their regular rate must be determined by applying clause (b) of the definition of regular rate, by dividing all earned wages in the work week by the non-overtime hours worked. The overtime premium of one and one-half times the regular rate is payable for all hours worked in excess of 44 in a work week, unless a higher overtime rate applies by virtue of contract or a higher threshold applies by virtue of regulation.
An employee works making oven mitts and is paid $2.00 per pair. In a particular work week, the employee works 60 hours to make 300 pairs of mitts and is paid $600.00. The employer has received approval from the Director of Employment Standards under ESA Part VII, s. 17.1 to have employees work excess weekly hours. The employee has also agreed in writing to work excess hours. The general threshold and premium apply to the employee.
Enquiries arise occasionally on the application of the legislation to motor vehicle mechanics and body repairpersons who are paid on a flat rate or incentive system. In a flat rate shop, every job is rated as taking a certain number of hours to perform and the mechanic is paid a book hourly rate for those hours. As an example, a brake reline is rated as a four-hour job, and the mechanic’s book rate is $16 per hour. The mechanic will be paid $64 whether the job takes three or five hours to complete. This is acceptable so long as minimum wage is being paid and all overtime hours (hours worked in excess of 44) are compensated at a minimum of 1.5 times the mechanic’s actual regular rate, which is not the same as the flat rate.
Generally, in a flat-rate remuneration system, it is a condition of employment that the employee rectify their own faulty work without further pay. This is not a violation of the ESA 2000, so long as the minimum wage and overtime provisions are not violated. If for some reason, another mechanic makes the required changes, the payment for the entire job is credited to the second mechanic. Where this occurs as part of the employment contract, the transfer of credits is considered as part of the reconciliation of wages due and not a prohibited set-off or deduction. However, the minimum wage and overtime provisions still apply with respect to the hours of work the first mechanic spent on the vehicle.
It is essential in a flat rate system that the employer’s records reflect both the flat rate paid and the actual hours worked: it is the actual hours worked that must be used to calculate the employee’s regular rate and overtime entitlements. Those actual hours of work must include any time spent rectifying the employee’s faulty work.
As illustrated in the examples below, payment at the book rate is payment for a task (i.e., a flat rate for the task), rather than a payment for hours actually worked. As no portion of the payment is made in respect of hours actually worked, none of it can be considered to be a payment for regular hours or overtime hours.
The employee is paid a flat book rate of $16.00 per hour for brake re-lining. They did 12 brake-relines which resulted in a flat rate payment for 48 hours (each re-line job is rated as taking 4 hours) for a total payment of $768. The employee however actually spent 46 hours doing the work in that week. The general overtime rate and threshold apply to this employee.
In this case, the employer owes the employee an additional $52.36 for overtime pay.
The employee is paid a flat book rate of $16.00 per hour to perform tune-ups that according to the book will take 1.5 hours to complete. In fact they are being paid $24.00 for each tune-up regardless of the time it actually took them to perform the tune-up. Having completed 25 tune-ups in one week the employee is paid $600 for that work week. However, the employee actually worked 50 hours in that work week. The general overtime rate and threshold apply to this employee.
In this case, the employer owes the employee an additional $122.76 for overtime pay.
Generally, employees who are paid a fixed amount for each pay period rather than an amount determined by applying an hourly rate to each hour worked (or a piece rate or commission based on work performed) are considered to be salaried employees. It should be noted that although ESA Part VI, s. 15(4) defines a salaried employee, that definition is for the purposes of ESA Part VI, s. 15(3), which sets out the employer’s obligations to record hours worked, and is not necessarily relevant to the calculation of overtime entitlements.
Salaried employees who are not exempt from the overtime provisions are entitled to overtime pay for overtime work. Once the work week has been determined, the employee’s regular rate will be determined by applying clause (b) of the definition of regular rate, by dividing the salary earned in respect of the work week by the number of non-overtime hours worked in the work week. Salaried employees are entitled to receive 1.5 times their regular rate in respect of each hour worked in excess of 44 in a work week (or other applicable threshold).
Prior to the introduction the ESA 2000, the calculation of the regular rate for salaried employees was accomplished by dividing the salary earned for the work week by the actual hours worked, including overtime hours. The employee was considered to have been paid straight time for all hours worked, including overtime hours, and received an additional .5 times their regular rate in respect of all overtime hours worked in the work week in question. This method of calculating overtime had the effect of lowering the employee’s regular rate as the number of hours worked increased and significantly reducing the employee’s entitlement to overtime pay.
Under the ESA 2000, overtime hours cannot be included in the calculation of an employee’s regular rate. Formerly, the more overtime hours a salaried employee worked, the less they were paid for those hours. The new definition of regular rate precludes that result because overtime hours cannot be included in the calculation.
An employee is paid an annual salary of $52,000 or $1000 per week. The employee works 60 hours in a work week. The employer has received approval from the Director of Employment Standards under s. 17.1 to have employees work excess weekly hours. The employee has also agreed in writing to work excess hours. The general overtime rate and threshold apply.
The employee’s entitlement to overtime pay for the work week is $34.10 x 16 hours = $545.60.
Where the conditions set out in this provision are met, the employer’s obligation to pay overtime pay is based on the employee’s average hours per work week (during the period specified in the employee’s averaging agreement or the period specified in the approval, whichever period is shorter), rather than the hours actually worked within a work week.
An employee and employer have agreed in writing and have the Director’s approval to average hours over four-week periods for the purpose of calculating the employee’s entitlement to overtime pay. The employee works 48 hours in the first week, 44 hours in the second week, 40 hours in the third week and 50 hours in the fourth week. The employee and employer have also agreed in writing and have the Director’s approval to work excess weekly hours.
The employee’s overtime hours will be determined on the basis of the average number of hours worked per week. In this example the employee worked an average of 45.5 hours per week (48 + 44 + 40 + 50, divided by 4). Accordingly, the employee would be entitled to overtime pay for six hours based on an average of 1.5 hours of overtime per week in the four-week period. In the absence of averaging, the employee would have been entitled to four hours of overtime pay in the first week and six hours of overtime pay in the fourth week.
It is program policy that the employer shall apply the proportion of each overtime rate to the averaged overtime hours.
For example, if the employee gets 4 hours of overtime pursuant to the 2 week averaging agreement and the employee worked 25% of the overtime in the 2 week period at Job A and 75% of the overtime at Job B, this employee would get 1 hour of overtime at the Job A’s overtime rate and 3 hours of the overtime rate at Job B.
Note that, unless there is a time off in lieu arrangement in place pursuant to s. 22(7), the employer is required to pay the employee straight time for every hour worked within each pay period — including those hours over 44 - and that it is only the extra half that the employer can postpone paying under an averaging arrangement until the end of the averaging period. See ESA Part V, s. 11 for details.
Section 22(2) provides that where averaging is permitted, the employee’s hours of work can be averaged only over separate, non-overlapping, contiguous periods of two or more consecutive weeks. That is, the averaging periods must be contiguous (i.e., there cannot be gaps in between the end of one period and the beginning of another), and they must be separate and cannot overlap with one another. Further, the two or more weeks within each averaging period must be consecutive.
Note that even if an employer has averaging agreements and an averaging approval, if employees will be working hours in excess of the daily or weekly limits the employer must also obtain excess hours agreements from the employees and, in the case where they work in excess of the weekly limit, an excess hours approval from the Director, subject to the pending approval rule.
The three conditions that must be met before averaging can take place are discussed below.
The first condition that must be met before an employer is permitted to average an employee’s hours is the employee must have entered into an agreement with the employer that their hours may be averaged over periods of a specified number of weeks.
For an agreement to valid, the following criteria must be met:
By virtue of ESA Part 1, s. 1(3), an agreement between an employer and an employee to average the employee’s hours of work, for purposes of calculating the employee’s entitlement to overtime pay must be in writing. See also ESA Part 1, s. 1(3.1), which provides that an agreement in writing may be in electronic form.
For employees represented by a trade union, the written agreement may be embodied in the collective agreement or a memorandum of agreement or other written documentation signed by union officials and, provided the other criteria are met, all bargaining unit employees will be bound by the agreement.
In the non-unionized context, a written agreement between each employee and the employer is required.
Section 22(2)(a) requires that the agreement state precisely the number of weeks over which the hours of work are going to be averaged. Statements such as "up to 4 weeks" are not sufficient.
The averaging agreement must also contain an expiry date. There are restrictions placed on when the expiry date can be. See s. 22(3) below for a more detailed discussion.
The agreement should be written with sufficient clarity for the parties to know precisely what they are agreeing to. Ambiguous or equivocal agreements will be ineffective.
The agreement should contain the employee’s express consent to the averaging of hours for the purpose of calculating the employee’s entitlement, if any, to overtime pay. Mere agreement to a particular schedule is not sufficient, as an employee may agree to work certain hours without necessarily having agreed to the hours being averaged for overtime pay purposes.
Employers are encouraged, but not required, to include schedules in averaging agreements.
Overtime averaging agreements must not be confused with agreements to work hours in excess of the weekly and daily maximums established in ESA Part VII, s. 17. Employers who wish employees to work hours in excess of eight hours a day (or the regular work day where that is longer than eight hours) or 48 hours a week must secure valid written agreements from their employees (and, in the case of excess weekly hours, obtain the Director’s approval) to work hours in excess of the daily and weekly maximums.
An averaging agreement will not be binding if it is not entered into voluntarily by both parties. Please see ESA Part I, s. 1(3) for a more detailed discussion of the issue of voluntary consent.
The employee must understand what they are agreeing to, and the consequences of the agreement, for an averaging agreement to be binding. Informed consent will not be established unless each party knows precisely the ramifications of entering into the agreement.
The best evidence that an employee provided their informed consent is where the document itself accurately sets out the consequences of the agreement. To this end, employers may wish to include the following in averaging agreements:
See s. 22(6) below for a more detailed discussion of these requirements.
Employers may also wish to consider including a specific schedule in an averaging agreement.
The Ministry has produced a list of items employers and employees may wish to consider when drafting agreements. This can be found on the Ministry of Labour’s website.
In the absence of a valid agreement, the employer must pay the employee overtime according to s. 22(1), or ensure that the employee does not work overtime, even if the Director of Employment Standards has issued an approval that applies to the employee.
Employers are required to retain a copy of every averaging agreement it has made with its employees for three years after the last day on which work was performed under each agreement — see ESA Part VI, s. 15(9).
If employee refuses to consent to an averaging agreement
If an employee does not agree to the averaging of their overtime hours, the employer must pay the employee overtime according to s. 22(1), or ensure that the employee does not work overtime (that is, hours in excess of 44 hours per week or other applicable threshold). If an employer terminates the employment of an employee or otherwise disciplines an employee because the employee refused to consent to the averaging agreement, that employer will have committed a reprisal in violation of ESA Part XVIII, s. 74.
Employers may wish to have averaging arrangements in place in order to provide employees with increased flexibility in their work schedules by allowing shift exchanges, without the requirement of paying overtime as a consequence of the shift exchanges.
Example
An issue that may arise in the context of an averaging agreement made for the purpose of accommodating shift exchanges is how to handle circumstances in which the employment of an employee who has been involved in a shift exchange ends before the exchange is complete. The following example illustrates the Program’s policy on this matter.
Example
The employees and the employer have agreed in writing and have received the Director’s approval to average hours of work over a period of four weeks for purposes of calculating overtime pay. Employee A agrees to work a shift for Employee B in week one of the averaging period. In exchange, Employee B agrees to work a shift for Employee A in week two of the averaging period; however, Employee B's employment is terminated before she can complete the shift exchange. The employees are paid their regular wages in respect of week one and week two.
The employer owes Employee A straight time for the shift she worked in week one for Employee B and in respect of which Employee A has not been compensated.
Employee B owes the employer the regular wages that she was paid for work that she did not perform in week one. Employee B is considered to have received an advance and therefore, the employer may make a reconciliation for this amount. Such a reconciliation is not considered to be a set-off or deduction as defined in ESA Part V, s. 13.
The second condition that must be met before an employer can average an employee’s hours for overtime pay purposes is the employer must be in receipt of an approval by the Director of Employment Standards under s. 22.1 that applies to the employee or to a class of employees that includes the employee.
ESA Part VIII, s. 22.1 describes how employers apply for an averaging approval.
This section must be read in conjunction with s. 22.1(8), which states:
Accordingly, where an employer already has an approval from the Director of Employment Standards, the employer may begin averaging an employee’s hours of work for overtime pay purposes immediately after the employee provides their written agreement to do so if that employee falls within the class of employees set out in the approval immediately (assuming that all of the requirements for a valid agreement are met) the employer will not be required to apply for another approval. For example, an employer will be allowed to average an employee’s hours without having to obtain another approval where the employee who provides the valid written agreement:
See ESA Part VIII, s. 22.1 for further discussion.
This section must also be read in conjunction with s. 22(2.1), which allows employers to average an employee’s hours for the purposes of overtime pay entitlements (but for periods of not more than two weeks) if the employer does not receive either an approval or a refusal from the Director within 30 days of the application being served and certain other conditions are met.
This is the third condition that must be met before an employer is allowed to average an employee’s hours of work for overtime pay entitlement purposes. It provides that averaging will be lawful only if the averaging period does not exceed the number of weeks specified in the employee’s agreement or the number of weeks specified in the Director’s approval, whichever is less.
For example, an employee agreed to average their hours of work over a period of eight weeks, but the Director issued an approval to average only over a period of four weeks. The employer can average the employee’s hours only over a period of four weeks.
Conversely, an approval was issued for an averaging period of four weeks that applies to a particular class of employees. Some employees in that class agreed to an averaging period of four weeks. The employer is permitted to average those employees' hours over a period of four weeks. One employee in that class agreed to an averaging period of only two weeks. Pursuant to s. 22(2)(c), the employer is permitted to average that employee’s hours only over a period of two weeks.
This section provides an exception to the requirement in s. 22(2) that the employer have received an averaging approval from the Director before the employer is permitted to average the employee’s hours for the purposes of determining overtime pay entitlements. It permits an employer to begin averaging an employee’s hours — but only over periods of two weeks — if the Director has not issued either an approval or a notice of refusal of the application within 30 days of the date the application was served and certain other conditions are met.
This section permits averaging of hours pending the Director issuing an approval or a notice of refusal if certain conditions are met. It does not deem an approval to have been granted. If the application is ultimately rejected, the averaging must cease when the notice is received.
If the application is ultimately approved, s. 22(2) will dictate the conditions under which averaging may occur from that point forward.
The employer will be permitted to average an employee’s hours of work for overtime pay entitlement purposes pending the disposal of the application — but only over periods of two weeks — only if all eight conditions set out in s. 22(2.1) are met. If any of the eight conditions are not met, the employer will not be permitted to average the employee’s hours pending the disposal of the application.
Each of the eight conditions is discussed below.
The first condition is the employee must have made an agreement described in s. 22(2)(a) with the employer to average hours of work over periods of a specified number of weeks. See the discussion of s. 22(2)(a) below.
The second condition is that the employer must have served the application for an averaging approval on the Director of Employment Standards under s ESA Part VIII, s. 22.1. See in particular the discussion of the issue of when an application is considered to be served if the approval application is not properly completed.
The third condition is the application for an averaging approval that has been served on the Director must apply to the individual employee at issue, or to a class of employees that includes the employee.
The fourth condition is at least 30 days must have passed since the employer served the Director with the averaging approval application. Day means a calendar day.
Note that ss. 22.1(4) and (5) contain rules regarding when service is deemed to be effective, and, accordingly, when the 30-day period begins. See the discussion at ESA Part VIII, s. 22.1.
Note also that s. 22(5.1) contains a special rule regarding when the 30-day period expires if the application is filed before March 1, 2005.
The fifth condition is the employer not have received a notice from the Director that the application has been refused. The notice could be in writing (by e-mail, facsimile transmission, courier, or mail).
The sixth condition is the employer’s most recent previous averaging application cannot have been refused. If the employer submitted an earlier application that was refused for any reason, and that application was the most recent application, the employer will not be permitted to rely on s. 22(2.1), and the employer will not be allowed to begin averaging the hours of the employees who are the subject of the current application until the current application is approved. This is so whether or not the most recent previous application that was refused applied to the same employees who are the subject of the current application.
The seventh condition is the most recent approval (if any) that was granted by the Director must not have been revoked. Pursuant to s. 22.1(14), the Director can revoke an approval.
The eighth condition sets an upper limit on the number of weeks in the periods over which an employee’s hours can be averaged pending the disposal of the application. It provides that the maximum period over which an employee’s hour of work can be averaged pending the disposal of the application is two weeks. This limit applies even if the employee agreed to average hours over periods longer than two weeks and/or the application asks for an approval to average hours over periods longer than two weeks.
Section 22(2.2) is a transitional provision. It establishes how agreements to average hours that were entered into under the provisions of the former Employment Standards Act or under the Employment Standards Act, 2000 before the amendments made by the Employment Standards Amendment Act (Hours of Work and Other Matters), 2004, SO 2004, c 21 came into force that have not expired are to be treated.
With respect to agreements made under the ESA 2000, paragraph 2 refers to agreements made under s. 22 as it read on February 28, 2005, i.e., agreements to average over periods of up to four weeks, while paragraph 3 refers to agreements made under O Reg 285/01, s. 30, i.e., agreements to average over period of more than four weeks. The latter required the approval of the Director. In the case of all three types of averaging agreements, this provision states that such agreements are to be treated as if they were agreements under s. 22(2)(a).
On February 28, 2005 the relevant provisions read as follows:
Section 22(2) of the ESA 2000:
Section 30 of O Reg 285/01:
By virtue of s. 22(2.2), agreements that were entered into under s. 22(2) or O Reg 285/01, s. 30 as they read on February 28, 2005 under the former Employment Standards Act that are still valid are treated as if they are agreements made under the current s. 22(2)(a) (new agreements), thereby avoiding the need for employers to enter into another agreement with employees if they wish to average hours after February 28, 2005. However, employers who have old agreements with employees must seek approval from the Director before the employer can average employees' hours of work. This is so even if the Director had approved the agreement pursuant to O Reg 285/01, s. 30 - see s. 22.1(18), which specifically provides that any approval granted by the Director under the regulation ceases to have effect on March 1, 2005.
This provision requires averaging agreements to include an expiry date. In the non-unionized context the expiry date cannot be later than two years from the date the averaging agreement takes effect. In the unionized context the parties must negotiate the expiry date. The purpose of this provision is to preclude perpetual averaging agreements. This is particularly important given that s. 22(6) provides that averaging agreements may not be revoked before they expire, unless the parties agree otherwise in writing.
This provision states that employers and employees may, before or upon the expiry of an averaging agreement, agree, in writing, to extend, to renew or replace the agreement.
This provision stipulates that averaging agreements made under the former Employment Standards Act and approved by the Director of Employment Standards, before the ESA 2000 came into force, will remain in force, for specified periods of time.
The purpose of this provision was to provide workplace parties operating under existing averaging agreements that predated the ESA 2000 with a period of stability before having to negotiate new averaging agreements.
This section was not repealed when amendments made by the Employment Standards Amendment Act (Hours of Work and Other Matters), 2004, came into effect on March 1, 2005, because it is possible that some agreements that predate the ESA 2000 are still in effect.
In the non-unionized workplace, an averaging agreement approved by the Director under the former Act remained in force until September 4, 2002, which was one year after the day s. 22 of the ESA 2000 came into force.
Where a collective agreement applies, valid pre-existing averaging agreements will remain valid until a subsequent collective agreement comes into operation. If a subsequent collective agreement has not come into operation one year after the existing collective agreement expires, the agreement will expire at the end of that year. For example, if a collective agreement that was in force on September 4, 2001, expired January 31, 2002, and no subsequent collective agreement came into force on or before January 31, 2003, the averaging agreement would have ceased to be valid on January 31, 2003.
This is a transitional provision. Pursuant to s. 22.1(19), employers can apply for approval of averaging agreements on or after December 9, 2004, the day the Employment Standards Amendment Act (Hours of Work and Other Matters), 2004 received Royal Assent, even though the amendments that require approvals for averaging agreements do not come into force until March 1, 2005. Applications are permitted prior to March 1, 2005 in order to facilitate a seamless transition between the old rules and the new rules.
Section 22(2.1) permits, in certain circumstances, an employer to average an employee’s hours of work for the purposes of determining any overtime pay entitlements (but only over a maximum period of two weeks) if the employer has not received either an approval or a notice of refusal of an averaging application within 30 days of the date the application was served. By virtue of s. 22(5.1), where an employer applies for an averaging approval prior to March 1, 2005, the 30-day wait period will expire on March 1, 2005 at the earliest.
For example, an employee agreed in writing to average hours of work over two-week periods for a period of two years back in July 2003. The employer served an application for an averaging approval on the Director on January 15, 2005. As of March 1, 2005, the Director had not issued either an approval or a notice of refusal of the application. This employer:
The ESA 2000 introduced this provision to ensure that once an averaging agreement is made, it cannot be unilaterally cancelled or revoked by the employer, the employee or their agents. Averaging agreements can only be revoked by the parties if the employer and the employee agree to do so in writing, in accordance with ESA Part 1, s. 1(3). The purpose of this provision is to provide the parties with a degree of certainty.
Note, however, that the Director has the authority to revoke an approval — see ESA Part VIII, s. 22.1.
The provision permits an employer and an employee to agree, in writing, that the employee be compensated for some or all overtime hours by receiving one and one-half hours of paid time off work for each hour worked in excess of 44 (or other applicable threshold) instead of receiving overtime pay if the following criteria are met:
Please see ESA Part I, s. 1(3) and (3.1) for a more detailed discussion.
Because the subsection states that the employee is to be compensated for overtime hours with one and one-half hours of paid time off work for each hour of overtime worked instead of overtime pay, it is the Program’s position that the employee is entitled to the time off at the rate they are currently earning as opposed to the rate they were earning when the overtime was worked. Note however, that if employment ends before the time off can be taken, the employer will be required to pay overtime pay based on the rate they were earning when the overtime was worked. See the discussion in s. 22(8) below.
This provision stipulates that if the employee’s employment ends before the lieu time earned pursuant to s. 22(7) is taken, the employee’s lieu time entitlement automatically converts into an entitlement to overtime pay. Pursuant to s. 11(5), the overtime pay is payable to the employee by the later of seven days after the termination of the employee’s employment or on what would have been the employee’s next pay day. Note that because this provision requires that the employer pay the employee overtime pay for the overtime hours that were worked, it is the Program’s position that the overtime pay the employee is entitled to receive is based on the rate the employee was earning when the overtime was worked as opposed to the rate they were earning when the termination occurred.
The purpose of this provision is twofold. This provision ensures that:
While s. 22(9) does not address the situation of employees who perform work for which the regulations prescribe differing overtime thresholds, it is Program policy to apply the principle behind that subsection by analogy to their situation. Thus, such employees are considered by the Program to be entitled to overtime pay for all hours worked in excess of the lower threshold provided that at least 50% of their work week is spent performing work that attracts the lower threshold. For example, employees who perform work that attracts overtime after 50 or 60 hours (local cartage and highway transport respectively) as per O Reg 285/01, ss. 17 and 18 would be entitled to overtime for all hours in excess of 50 in a week if at least 50% of the hours worked in the week were in local cartage.
Under s. 22(2) of the Employment Standards Act, 2000, an employer may average an employee’s hours of work for the purpose of determining the employee’s overtime pay entitlement if certain conditions are met. One of those conditions is that the employer be in receipt of an approval under s. 22.1 that applies to the employee or to a class of employees that includes the employee.
Sections 22.1(1) to (19) describe the process for applying for an averaging approval.
This section provides that an application for an averaging approval must be made in a form provided by the Director of Employment Standards.
The form, Hours of Work and Averaging Hours, is available on the Ministry of Labour’s website.
This section sets out three different methods an employer may use to serve an averaging application form on the Director of Employment Standards. The three ways are:
For example, personal delivery by the employer or its representative or agent, or by private courier The Director’s office will provide a receipt or other acknowledgement to verify that the application has been received.
Three Canada Post services falls within the meaning of verifiable mail — Registered Mail, Xpresspost and Priority Courier. Xpresspost and Priority Courier comply with the requirement of s. 22.1(3)(b) only if the signature upon delivery option is selected.
To serve the application by electronic transmission, employers must complete the application on the Ministry of Labour’s website and submit it electronically.
The application form provides the Director’s address and facsimile number.
This section must be read in conjunction with s. 22.1(4), which sets out when service is deemed to be effective.
These sections set out when the service of the application is considered to have been effected. This is important for the purposes of the pending approval provisions in s. 22(2.1) which permit employers to begin averaging an employee’s hours for overtime pay purposes (if certain conditions are met and even then only over a period of two weeks) if the application has been neither approved nor rejected within 30 days of the effective service date.
Under ss. 22.1(4) and (5), service is considered to be effected:
If the employer served the application by delivering it to the Director’s office on a day and at a time when it is open as per s. 22.1(3)(a), service is deemed to be effective on the day indicated on the receipt or acknowledgement provided by the Director or their representative.
If the employer served the application by mailing it to the Director’s officer using a method of mail delivery that allows the delivery to be verified as per s. 22.1(3)(b), service is deemed to be effective on the day shown in the verification.
If the employer served the application by sending it to the Director’s office by electronic transmission via the online filing system or by fax as per s. 22.1(3)(c), service is deemed to be effective on the day on which the electronic transmission or fax transmission is made. However, if the electronic transmission or fax transmission is made on a day that the Director’s office is closed or after 5 p.m. on any day, the service is deemed to be effected on the next day that the office is open. Generally, the Director’s office is closed on Saturdays, Sundays, the nine public holidays under the ESA 2000, as well as Easter Monday, the August Civic Holiday, and Remembrance Day. See the definition of public holidays in ESA Part I, s. 1.
Section 22.1(6) provides that the Director may issue an approval for an averaging application if they are of the view that it would be appropriate to do so. Section 22.1(7) sets out some criteria that the Director may consider when deciding whether to issue an approval.
Section 22.1(7) allows to Director to consider any factor they consider relevant, and specifically lists three factors that may be taken into consideration:
In addition to the factors listed above, the Director may consider any factor they consider relevant. Some factors that may be considered when the Director is asked to approve an averaging application under s. 22.1 include:
Please refer to Delegation of Powers for general principles of how the Director exercises their discretion under the ESA 2000.
These sections specify to which employees an approval applies. The approval applies to:
Section 22.1(9) provides that all of the employer’s employees can be a specified class. Where approval is given to a specified class, the approval will apply to an employee in that class even if the employee was not an employee in that class when the approval was given. This means that where an employer already has an approval for a specified class of employees, it is not required to seek another approval if a new employee subsequently begins working in that class, assuming that all of the requirements for a valid averaging agreement are met.
Section 22.1(8) means that an employer will be allowed to average an employee’s hours for the purposes of determining overtime pay entitlements without having to obtain another approval where, for example, the employee who provides the written agreement:
This section requires employers who receive an approval to post the approval or a copy of the approval in the workplace. It must be posted in a place or places such that it is likely to come to the attention of the employee(s) named in the application. If the application is with respect to a class of employees, a copy of it must be posted in a place or places that that all of the employees in the class are likely to see it.
An issue arises as to how this requirement applies where the approval is issued to an employer whose employees are assigned to work in a client’s workplace, for example, where the employer is a temporary help agency, security company, food service provider, or cleaning company. In this type of situation, the employer is required by s. 22.1(10) only to ensure that the approval is posted in its own workplace. If the employer has several branches where the employees to whom the approval applies attend, then the approval issued to the employer must be copied and posted in each branch. The employer is not required to post a copy of the approval at its clients’ work sites.
Section 22.1(11) requires the employer to keep the approval posted until the day it expires or is revoked. This section further requires the employer to remove the approval upon the expiry or revocation of the approval.
This section establishes an expiry date for an averaging approval.
Generally, an approval will expire on the date specified in the agreement itself. Section 22(3) requires that agreements contain an expiry date, and sets limits on the duration of the agreement — see ESA part VIII, s. 22. Where the Director has specified an expiry date in the approval that is earlier than the expiry date in the agreement, the approval will expire on the earlier date. In this latter case, an employer who wishes to apply for another approval when the expiry date of the approval is approaching may not be required to obtain another agreement from the employee(s), since the agreement is still in effect.
This section authorizes the Director to impose conditions on an approval. See the discussion of s. 22.1(15) below, for the criteria the Director may consider when deciding whether to impose conditions.
This section authorizes the Director to revoke an approval that was granted to an employer, upon giving the employer an amount of notice the Director considers to be reasonable in the circumstances. See the discussion of s. 22.1(15) below, for the criteria the Director may consider when deciding whether to revoke an approval.
Section 22.1(15) provides that the Director may consider any factor they consider relevant when deciding whether to impose conditions on an approval or whether to revoke an approval. The three factors that are specifically listed in s. 22.1(7) as factors the Director can consider when determining whether to grant an approval are among those that may be taken into account when deciding whether to impose conditions on an approval or revoke an approval. See the discussion of s. 22.1(7) above.
Another factor that the Director may, depending on the circumstances, consider relevant when deciding whether to revoke an approval is if, after the approval is issued, an employment standards officer finds that some of the employees to whom the approval applies did not have valid agreements to average hours, either because, for example, they were coerced into signing the agreement, the agreements were ambiguous, or they did not sign agreements at all.
Where there is no valid averaging agreement between the employer and a particular employee, it would not be lawful for the employer to average that employee’s hours of work, even if the employer has an approval that applies to a class that includes that employee. However, the fact that some of the employees who fall into the class do not have valid averaging agreements may cause the Director to decide to revoke the approval, thereby also making it unlawful for the employer to average the hours of employees who were in the class who do have valid averaging agreements.
This provision clarifies that nothing in s. 22.1 prevents an employer from re-applying for an approval after:
This section requires the Director to provide notice to the employer if an application for approval has been refused. If notice of a refusal is given, employers will no longer — as of the date the notice is received — be allowed to rely on the pending approval provision in s. 22(2.1) to average an employee’s hours, since one of the conditions that must be satisfied in order to use s. 22(2.1)(e) — "the employer has not received a notice that the application has been refused" — will no longer be met.
This section provides that certain approvals granted before March 1, 2005 expire on March 1, 2005, which is the date the amendments made by the Employment Standards Amendment Act (Hours of Work and Other Matters), 2004 that require employers to obtain approval from the Director to engage in any averaging came into force.
The approvals that expire are those that were granted pursuant to O Reg 285/01, s. 30, which was subsequently revoked. Prior to its revocation, O Reg 285/01, s. 30 allowed an employer and employee to agree to average hours of work over a period of more than four weeks for the purpose of determining the employee’s entitlement to overtime pay if the Director approved the agreement.
These approvals ceased to have effect on March 1, 2005 even though the approval may have contained an expiry date later than March 1, 2005.
An employer that had an approval under the revoked O Reg 285/01, s. 30 is required to apply for an approval under s. 22.1 in order to average its employees’ hours on and after March 1, 2005. Applications may be made on or after December 9, 2004, the day that the Employment Standards Amendment Act (Hours of Work and Other Matters), 2004 received Royal Assent — see s. 22.1(19).
This section provides that applications for approval to average hours under s. 22.1 can be made on or after December 9, 2004, the day that the Employment Standards Amendment Act (Hours of Work and Other Matters), 2004 received Royal Assent. Although any approval that is issued before March 1, 2005 can take effect no earlier than March 1, 2005, as that is the date the amendments to the ESA 2000 by the Employment Standards Amendment Act (Hours of Work and Other Matters), 2004 came into force, this provision was intended to facilitate a seamless transition between the old rules and the new rules.
Section 22.2(1) sets out the authority of the Director of Employment Standards to delegate his or her powers under s. 22.1. The delegation may be made orally or in writing to anyone employed in the Ministry of Labour. In contrast, the Director’s general delegation power in s. 88(3) of the Employment Standards Act, 2000 extends only to employment standards officers.
Section 22.2(2) preserves the Director’s ability to exercise powers under s. 22.1 even if they have been delegated under subsection (1).
Section 22.2(3) provides that an individual to whom the Director has delegated his or her s. 22.1 powers must follow any policies established by the Director under s. 88(2) respecting the interpretation, administration and enforcement of the Act.
The minimum wage establishes a wage floor to prevent employers from taking unfair advantage of employers with little or no bargaining power.
Historically, the minimum wage was adjusted periodically on an ad hoc basis to reflect declining purchasing power of low wage earners, loss of their position relative to wage gains of workers generally, and changing minimum wage rates in other jurisdictions. In considering adjustments to the minimum wage, a number of other factors were considered to be relevant, including the relationship between minimum wage income and income from social assistance, and an industry's ability to compete internationally and to create employment.
The Stronger Workplaces for a Stronger Economy Act, 2014, SO 2014, c10 amended the ESA 2000 to directly tie changes in the minimum wage rates to increases in inflation through a formula based on changes in the Consumer Price Index. The Fair Workplaces Better Jobs Act, 2017, SO 2017, c 22 subsequently amended the minimum wage provisions and increased minimum wage rates to set amounts on January 1, 2018 and again on January 1, 2019. Effective October 1, 2019, the minimum wage rates in effect immediately before October 1 resumed being adjusted annually by the formula based on changes in the Consumer Price Index. The Build Ontario Act (Budget Measures), 2021, SO 2021, c. 40 (BOABM) further amended the minimum wage provisions by increasing the minimum wage rates for classes of employees described in paragraph 1 of ss. 23.1(1) to set amounts on January 1, 2022. Effective October 1, 2022, the minimum wage rates in effect immediately before October 1 are to resume being adjusted annually by the formula based on changes in the Consumer Price Index.
O. Reg. 285/01 was also amended effective January 1, 2022 to increase the minimum wage rate applying to the “wilderness guides” class of employees. Effective October 1, 2022, the rate in effect immediately before October 1 will resume being adjusted annually by the formula based on changes in the Consumer Price Index.
The BOABM also eliminated a class of employees to whom a special minimum wage rate previously applied: employees who, as a regular part of their employment, serve liquor directly to customers, guests, members or patrons in premises for which a licence or permit has been issued under the Liquor Licence Act and who regularly receive tips or other gratuities as a part of their work. As of January 1, 2022, employees who previously fell into this “liquor server” category are entitled to receive the “general” minimum wage instead of a rate specific to the “liquor server” class of employees.
This provision requires that an employer pay employees at least the minimum wage. See the discussion under s. 23.1 "Determination of minimum wage for information about the minimum wage rates.
This provision deems prescribed amounts with respect to room or board to be wages paid to the employee. The prescribed amounts are set out in the following regulations:
Note that the prescribed amounts cannot be deemed to be wages unless the room/accommodation satisfies criteria set out in the regulation and the employee has received the meals or occupied the room. For a detailed discussion of these requirements, see O Reg 285/01.
This provision simply states that the assessment as to whether the minimum wage requirements have been met shall be conducted on a pay period basis. Contrast this to the overtime provisions, where the threshold to determine whether overtime pay is owing is determined with reference to the work week - see ESA Part VIII, s. 22(1). Section 23(4) elaborates on this by providing a formula to be used in the case of employees whose minimum wage rate is expressed as an hourly rate.
This section sets out two calculations to be used for determining whether the minimum wage requirements have been met for employees whose minimum wage is expressed as an hourly rate. The provision is not, therefore, relevant for hunting and fishing guides.
Divide the "regular wages" paid for the pay period by the number of hours worked in the pay period (other than those hours that attract overtime or premium pay). The resulting number ("the quotient") must meet or exceed the minimum wage.
Note:
Divide the amount of overtime pay plus premium pay paid to the employee in the pay period by the number of hours worked during the pay period for which the employee is entitled to receive overtime pay or premium pay. The resulting number must meet or exceed one and one-half times the minimum wage.
Note that this second calculation is necessary only if there are overtime hours or hours that attract premium pay in the pay period.
***
An employer may pay an employee on a basis other than time (e.g., piece rate); however, the amount paid must at least be equal to the minimum wage.
Note that ESA Part IX, s. 23.0.1 states that where the employee's pay period crosses over the effective date for a minimum wage rate increase, the calculations required by s. 23(4) are to be performed as if the pay period were in fact two separate pay periods.
The Fair Workplaces, Better Jobs Act, 2017, SO 2017, c 22 added s. 23.0.1 to the ESA, effective January 1, 2018. The same provision previously existed in O Reg 285/01, s. 5.1.
This provision states that where the employee's pay period crosses over the effective date for a minimum wage rate increase, the calculations required by ESA Part IX, s. 23(4) are to be performed as if the pay period were in fact two separate pay periods.
The following example, based on the increase in the minimum wage on January 1, 2018 demonstrates how compliance with the minimum wage entitlement is determined when an employee's pay period straddled the date of a rate change:
The employee's pay period runs from Wednesday, December 27, 2017 to Tuesday, January 9, 2018 inclusive.
The employee's work week runs from Wednesday - Tuesday and the employee works eight hours per day Wednesday, Thursday and Monday of each work week except for the public holiday on Monday January 1, 2018.
Because the minimum wage rate applicable to the employee changed as of January 1, the pay period of December 27, 2017 to January 9, 2018 must be treated as consisting of two separate pay periods for purposes of the calculations required by ESA Part IX, s. 23(4).
The first period would be the period from December 27 to December 31 and the second period would be the period from January 1 to January 9. As there are no overtime pay or premium pay in this example, the calculations would be made as per s. 23(4)(a).
As a result, in order for the employer to show compliance with the minimum wage entitlements:
Refer to ESA Part IX, s. 23(4) for further explanation.
Subsection 23.1(1) was amended by the Build Ontario Act (Budget Measures), 2021 effective January 1, 2022. The rates for employees in classes (i) to (iv) were increased. The special minimum wage class that applied to employees who serve liquor directly to customers, guests, members or patrons in premises for which a licence or permit had been issued under the Liquor Licence Act and who regularly received tips or other gratuities from their work was eliminated. As such, employees who previously fell within that class of employees are entitled to the “general” minimum wage rate as set out in subparagraph (iv) effective January 1, 2022. The rates described in section 23.1 are in effect between January 1, 2022 and September 30, 2022. Beginning on October 1, 2022, the rates will be determined in accordance with the formula based on the Consumer Price Index set out in subsection (4).
The special student minimum wage in s. 23.1(1)(i) applies to a student under the age of 18 years who does not work more than 28 hours per week while attending school, or who is employed while on a school holiday. A school holiday includes summer holidays and breaks during the academic year, e.g., Christmas holidays, March break, etc.
This special rate was introduced to facilitate the employment of younger persons, recognizing their competitive disadvantage in the job market relative to older students who generally have more work experience and may be perceived by employers as more productive.
The term student is not defined in the ESA 2000. The Program considers a student to be a person who is in attendance at an elementary, secondary or post-secondary institution. In order to be paid the student minimum wage, the student must be under the age of 18 years.
Under s. 21 of the Education Act, RSO 1990, c E.2, generally speaking, every child is required to attend an elementary or secondary school from the age of six until attaining the age of 18 years. There are some exceptions.
If an employee is neither attending an educational institution nor on a school holiday, the employer will be liable for the general minimum wage even if the employee is under the age of eighteen.
The onus is on the employer seeking to pay the student minimum wage rate to confirm that the youth is either in attendance at an educational institution or on a school holiday.
Note that students who are employed as homeworkers are entitled to the higher homeworkers' minimum wage in accordance with s. 23.1(1.1).
The hunting or fishing guide minimum wage rate in s. 23.1(1)(ii) must be paid by employers who employ guides for their guests (such as camp or lodge proprietors) or who carry on a guide service. This rate is unique in that it is not expressed as an hourly rate.
The minimum wage for employees who are homeworkers in s. 23.1(1)(iii) has historically been set at 110 per cent of the general minimum wage. The rationale for a higher rate is that the homeworker has certain overhead costs (e.g., heat, electricity, taxes) in connection with their employment that other employees do not have. Effective October 1, 2015 and annually thereafter, it is expressed as a dollar amount rather than a percentage of the general minimum wage rate, although at the time of writing, the dollar amount was in fact 110% of the general minimum wage rate.
The general minimum wage rate in s. 23.1(1)(iv) applies to any other employee not falling within one of the classes described in subparagraphs i-iii of paragraph 1 of s. 23.1(1) or section 6 of O. Reg. 285/01 (the minimum wage for wilderness guides) and who is not otherwise exempted from coverage of ESA Part IX, Minimum Wage.
Commission salespersons who normally make their sales away from the employer's premises (other than route salespersons) are exempt from the minimum wage provisions pursuant to O Reg 285/01, s. 2(1)(h). However, commission salespersons who normally make their sales at the employer's premises (“inside salespersons”) or who are route salespersons are covered by the minimum wage provisions. Car, furniture and appliance salespersons would typically be inside salespersons. Although note that there are special rules regarding commission earnings for car salespersons – see O Reg 285/01, s. 28 for a further discussion.
Some inside salespersons may receive a draw against commissions. In such a case, if the draw equals or exceeds the minimum wage for the pay period in question, the minimum wage requirement in the ESA 2000 is met.
In some cases, salespersons may be employed under arrangements, whereby, if the draws exceed the commissions actually earned, the employer may carry forward the negative balance and make an adjustment when calculating future commissions owing. In other words, the draw (or some portion thereof) is a negative balance carried forward for the purposes of calculating the employee's earnings in subsequent pay periods. A negative balance may continue to be carried forward over any number of pay periods but the employee must be paid the equivalent of at least minimum wage in respect of all hours worked in each and every pay period, whether through draw or a combination of draw and commission earnings. Applying a negative balance with the result that the employee's gross wages amount to something less than minimum wage for all hours actually worked in any pay period would contravene the minimum wage provisions. Note however that statutory or other authorized deductions (for example) that then reduce the net pay to something less than minimum wage does not result in a contravention of the minimum wage provisions. See the discussion in ESA Part V, ss. 13(1) and (3). If the employer pays straight commission with no advance or draw, then the commission must equal at least the minimum wage for the pay period over which the commissions are calculated; if it does not, the employer must top up the employee's earnings so that they receive at least the minimum wage.
Enquiries arise occasionally on the application of the minimum wage provisions to motor vehicle mechanics and body repair persons who are paid on a flat rate or incentive system. In a flat rate shop, every job is rated as taking a certain number of hours to perform and the mechanic is paid a "book" rate, i.e., the employee's hourly rate is multiplied by the hours rated for the job rather than their actual hours. As an example, a brake reline is rated as a four-hour job, and the mechanic's book rate is $16 per hour. The mechanic will be paid $64, even if the job takes the employee less than four or more than four hours to complete. This is acceptable so long as minimum wage is paid on the basis of actual time worked and all overtime hours (hours worked in excess of 44) are compensated at a minimum of 1.5 times the mechanic's actual regular rate, which is not the same as the flat rate. For a discussion on how to calculate overtime entitlements, see ESA Part VIII, s. 22.
Generally, in a flat-rate remuneration system, it is a condition of employment that the employee rectify their own faulty work without further pay. This is not a violation of the ESA 2000, so long as the minimum wage and overtime provisions are not violated based on actual time worked. If for some reason, another mechanic makes the required changes, the payment for the entire job is credited to the second mechanic. Where this occurs as part of the employment contract, the transfer of credits is considered as part of the reconciliation of wages due and not a prohibited set-off or deduction. However, the minimum wage and overtime provisions still apply with respect to the actual hours of work the first mechanic spent on the vehicle.
It is essential in a flat rate system that the employer's records reflect both the flat rate paid and the actual hours worked: it is the actual hours worked that must be used to calculate the employee's regular rate and overtime entitlements including any time the employee spends rectifying their own faulty work.
Effective January 1, 2022, the Build Ontario Act (Budget Measures), 2021 eliminated a class of employees to whom a special minimum wage rate previously applied: employees who, as a regular part of their employment, serve liquor directly to customers, guests, members or patrons in premises for which a licence or permit has been issued under the Liquor Licence Act and who regularly receive tips or other gratuities from their work. As such, there is no longer a special minimum wage rate that applies to “liquor servers”. However, employees may still have a minimum wage complaint that arose when the “liquor servers” minimum wage rate was in effect. For this reason, the Program has retained the following discussion as part of this publication.
Until January 1, 2022, a special liquor servers' minimum wage rate applied to employees who directly serve liquor to a customer, guest, member or patron in premises where a licence or permit had been issued under the Liquor Licence Act, RSO 1990, c L-19, and who regularly receive tips or other gratuities from their work. The minimum wage rate for this class of employees over the last few years is as follows:
The Fair Workplaces, Better Jobs Act, 2017 amended the subparagraph describing this class of employees to add the condition that liquor servers regularly receive tips or other gratuities in order for this rate to apply effective January 1, 2018.
Liquor service must also be a regular part of the employee's duties; an employee who only occasionally serves liquor is entitled to the general minimum wage. An earlier regulation did not include the regular service requirement, which led the Ontario Divisional Court in Re Fisherman's Wharf Ltd. and Wehrenberg to hold that an employer did not violate the Act by paying the liquor server minimum wage to a busperson who was not employed to serve liquor but who occasionally took liquor to tables to assist a waiter. However, under the wording of the current provision, a busperson in those circumstances would be entitled to be paid the general minimum wage.
Employees who serve liquor as a regular part of their employment are entitled only to the liquor servers' minimum wage for all hours worked within that employment relationship. The ESA 2000 does not require that employees be paid the general minimum wage rate when liquor is not being served and the liquor server rate when liquor is being served. Rather, the question to ask is whether an employee serves liquor directly to customers as a regular part of their employment and regularly receives tips or gratuities from their work. If so, that employee is entitled only to the liquor servers' minimum wage for all hours worked.
Note that tips or other gratuities, as defined in ESA Part I, s. 1, are not wages, as they are specifically excluded from that definition in ESA Part I, s. 1. As a consequence, they are not considered in determining whether or not an employee has been paid minimum wage. However, as noted above, whether the employee regularly receives tips or other gratuities from their work must be taken into consideration in determining whether the liquor server minimum wage rate applies to the employee. If the employee does not regularly receive tips or other gratuities from their work, the employee would be entitled to the general minimum wage rate for all hours worked.
Subsection 23.1(1.1) was amended by the Build Ontario Act (Budget Measures), 2021 effective January 1, 2022 to reflect the renumbering of the subparagraphs in subsection (1) due to the elimination of the liquor servers’ minimum wage rate.
Section 23.1(1.1) provides that where an employee is both a homeworker and a student under 18 years of age of age whose weekly hours do not exceed 28 hours or if the student is employed during a school holiday, the homeworkers' minimum wage rate applies to that employee.
Subsection 23.1(2) was amended by the Build Ontario Act (Budget Measures), 2021 effective January 1, 2022 to reflect the renumbering of the subparagraphs in subsection (1) due to the elimination of the liquor servers’ minimum wage rate.
This provision is an exception to s. 23.1(1). It permits a minimum wage to be prescribed by regulation for any new class of prescribed employees who would otherwise fall within the class described in subparagraph 1 v. In other words, a new class of employees may be prescribed out of the class otherwise entitled to receive the general minimum wage and a minimum wage may be prescribed for that new class.
O. Reg. 285/01 s. 6(1) has prescribed wilderness guides as a class of employees for the purposes of s. 23.1(2). See the discussion of that provision for additional information.
Section 23.1(3) provides that if a new class of employees is prescribed under s. 23.1(2) and a minimum wage is prescribed for that class, the minimum wage for that class will be adjusted annually in accordance with ss. 23.1(4) to (6). In other words, once a minimum wage is prescribed for any new class of employees, it will thereafter be subject to adjustments using the same formula that applies to the classes of employees set out in s. 23.1(1).
Since wilderness guides have been prescribed as a class under s. 23.1(2), this provision establishes that the wilderness guide minimum wage will be adjusted annually in accordance with ss. 23.1(4) to (6).
Subsection 23.1(4) was amended by the Build Ontario Act (Budget Measures), 2021 effective January 1, 2022 to establish that the minimum wage rates in effect immediately before October 1 in each year are to be adjusted on October 1 of that year starting in 2022.
The provision sets out a formula based on changes in the Consumer Price Index, which reflects inflation. Consumer Price Index is defined in s. 23.1(12) – see below.
The way in which the minimum wage rates are adjusted under s. 23.1(4) can be illustrated with the following example using the general minimum wage rate of $15 per hour that came into effect on January 1, 2022.
Note that the changes in the CPI shown in the example are not the actual figures and are used merely for purposes of illustration.
Thus, using the fictional CPI numbers the general minimum wage rate that would come into effect on October 1, 2022 would be $15.75 an hour.
Subsection 23.1(4) is subject to s. 23.1(5) and (6). If the adjusted wage is an amount that is not a multiple of five cents, the amount will be rounded up or down to the nearest amount that is a multiple of five cents. In addition, if the applying the formula in s. 23.1(4) would result in a decrease, no adjustment will be made. See ss. 23.1(5) and (6) below.
If applying the formula in s. 23.1(4) results in an amount that is not a multiple of five cents, the amount will be rounded up or down to the nearest amount that is a multiple of five cents.
For example, if the calculation resulted in an amount of $16.04, the new minimum wage rate will be $16.05.
This subsection provides that if applying the formula in s. 23.1(4) would result in a decrease in the minimum wage, no adjustment is to be made. Thus, if the provincial economy went through a deflationary period, such that the change in the Consumer Price Index was negative, the minimum wage would remain unchanged.
This provision requires the Minister to publish on a government website the minimum wage rates that will be in effect on October 1 of each year by April 1 of that year, beginning in 2021.
Subsection 23.1(7) was amended by the Build Ontario Act (Budget Measures), 2021 effective January 1, 2022 to establish that the Minister shall publish the rates that are to apply starting on October 1 no later than April 1 of every year after 2021.
Paragraph 2.0.1 of ESA Part XXVII, s. 141(1) provides that a regulation may be made that in effect carves out a class of employees who would otherwise fall within the general class in subparagraph 1v of s. 23.1(1), and to prescribe a minimum wage for that class that is different from the minimum wage that applies to the general class. This leaves open the possibility that such a regulation might be made in the interval between the date that the Minister publishes the minimum wage rates that are to come into effect on October 1 (which must be no later than April 1) and October 1. In that event, the rate that was published for the general class will not apply to the new class that was carved out of the general class. To address this possibility, s. 23.1(9) requires the Minister to promptly publish the rate that will apply to the new class as of October 1.
23.1(12) In this section,
This provision defines Consumer Price Index, a term that appears in the formula for making annual adjustments in the minimum wage rates in s. 23.1(4). Note that Statistics Canada publishes a number of indices for measuring inflation; the one used for purposes of s. 23.1(4) is the index for Ontario (not the national index) that considers all items (i.e., without excluding any goods or services in the basket of goods and services that Statistics Canada uses for measurement purposes).
Part X provides for an employee’s right (subject to specified qualifying conditions) to:
The labour arbitration case of U.A.W., Local 569 v. Sealed Power Corp. of Canada (1971), 22 LAC 371 (Ont Arb Bd) spoke of three rationales for the public holiday entitlement:
Section 24(1) establishes how public holiday pay is to be calculated for the purposes of Part X of the ESA 2000.
Paragraph (a) provides for what is commonly referred to as a “pro-rating” formula for public holiday pay, based on a five-day work week (20 divided by four work weeks). At the time of writing, no other manner of calculation is prescribed pursuant to paragraph (b).
There were several significant changes to the public holiday pay provisions in 2018. See the text that is in red at the end of this section for details of the changes, information on which provisions applied at which points in time, and for the interpretation of the former provisions.
The amount of public holiday pay owing is calculated as follows:
plus
Vacation pay can become payable in the following circumstances:
In Munro Ltd. v Director of Employment Standards, 2015 CanLII 37329 (ON LRB), the Board determined that the employer must take into account the vacation pay earned by an employee in reference to their regular wages in the four-week period before the public holiday when calculating public holiday pay. The Board’s analysis hinged on the meaning of vacation pay payable, and found that s. 24(1) does not require the employer to take into account vacation pay actually paid in the four-week period. This decision is contrary to Program policy, which is that vacation pay payable means vacation pay paid or that ought to have been paid.
“Regular wages” is defined in ESA Part I, s. 1 as follows:
Work week is defined in ESA Part I, s. 1 as follows:
This means that the phrase in s. 24(1) that sets out the period over which the calculation of public holiday pay is to be performed - the four work weeks before the work week in which the public holiday occurred - does not necessarily refer to the four calendar weeks immediately preceding the public holiday.
For example, an employer has selected a work week of Monday to Sunday and the public holiday falls on a Thursday. The four work weeks with respect to which the public holiday pay calculation is performed will go backwards four weeks starting on the first Sunday (the last day of the employer’s work week) before the public holiday:
In this example, the regular wages earned and vacation pay payable to the employee in the four work weeks identified will be used in the calculation.
Note that in certain circumstances, employees are entitled to a substitute holiday and to be paid public holiday pay as if the substitute day were a public holiday – see for example ESA Part X, s. 27(2)(a). This means that when calculating the amount of public holiday pay owing for a substitute day, the period over which the calculation is performed is the four work weeks before the work week in which the substitute day falls, not the four work weeks before the work week in which the actual public holiday fell.
An issue may arise as to the wages that are to be included where there has been a sale of a business shortly before a public holiday and an employee of the seller is hired by the purchaser. Specifically, the question is whether the calculation includes wages that were earned by the employee from the seller. For example, the four work weeks prior to Canada Day, over which the calculation of public holiday pay is performed is, for the sake of this example, June 1 to June 28. Employee ZZ had been working for Employer A. On June 25, Employer A's business was sold to Employer B. Employer B hired Employee ZZ, effective June 25. When determining Employer B's public holiday pay obligations towards Employee ZZ for Canada Day, does one include the wages that were earned by Employee ZZ under Employer A from June 1 to June 24? It is Program policy that the answer is yes. To say otherwise would undermine the general intent behind the continuity of employment provisions found in ESA Part IV, s. 9. Similarly, because s. 9 states that there is deemed to not be a termination or severance in circumstances such as the one in this example, the situation can be viewed as being the same employment relationship. Since s. 24(1)(a) refers to regular wages that are “earned” by the employee and vacation pay “payable” to the employee, all wages earned and vacation pay payable within that employment relationship are included, i.e., including those from the seller.
Employee:
To calculate public holiday pay:
plus
Employee:
To calculate public holiday pay:
plus
Employee:
To calculate public holiday pay:
plus
Employee:
To calculate public holiday pay:
plus
Employee:
To calculate public holiday pay:
plus
Employee:
To calculate public holiday pay:
plus
Employee:
To calculate public holiday pay:
plus
Note that even though this employee is full-time, in the sense that they work full-time hours, the amount of public holiday pay owing will be a pro-rated amount of their regular daily wage because they work less than five days a week.
Only regular wages and vacation pay are included in the calculation of public holiday pay. Regular wages is defined in ESA Part I, s. 1 to exclude overtime pay. Overtime pay as per Part VIII, s. 22(1) is not just the extra premium of .5 times the regular rate for each hour over the prescribed overtime threshold, but is the entire 1.5 times the regular rate for each hour worked over the prescribed overtime threshold. This means that all payment for hours worked over the prescribed threshold is excluded from the calculation.
Employee:
To calculate public holiday pay:
plus
Note that although this employee’s average daily wage (not including vacation pay) is $212 [(44 hours x $20) + (6 hours x $30) divided by 5], the employee is entitled only to $184.48 public holiday pay because overtime pay is excluded from the public holiday pay calculation.
If an employee is subject to an averaging agreement or arrangement, the employee may exceed the weekly overtime threshold in a particular week, but might not receive overtime pay for those hours because of the averaging arrangement. In this case, wages for all of the hours worked will be included in the calculation.
Employee:
To calculate public holiday pay:
plus
As in example 7A, those overtime wages will be excluded from the calculation of public holiday pay.
Employee:
To calculate public holiday pay:
plus
Public holiday pay is excluded from the definition of regular wages. This becomes relevant for the New Year’s Day and, depending on the work week of a workplace, possibly Boxing Day, calculation of public holiday pay. It can have the effect of lowering the amount of public holiday pay owing to an employee on New Year’s Day and possibly Boxing Day.
Employee:
To calculate public holiday pay for Christmas:
The four work weeks over which the calculation is performed is from Monday November 24 to Sunday December 21.
plus
To calculate public holiday pay for December 26 (Boxing Day):
The four work weeks over which the calculation is performed is from Monday November 24 to Sunday December 21.
plus
To calculate public holiday pay for New Year’s Day:
The four work weeks over which the calculation is performed is from Monday December 1 to Sunday December 28.
plus
Employee:
To determine whether the proper amount of public holiday pay has been paid:
As the amount owing to the employee under the public holiday calculation is $160.00 and the employee only received $101.60 for the substitute holiday, the employer owes the employee $58.40.
Note that if the employee had taken a different workday off other than a Tuesday, the result would differ because of the different number of hours the employee works on their other workdays.
If a contract of employment provides that an employee is to be given public holiday pay in addition to their salary, then the employee gets the public holiday pay plus the regular salary. But, absent such a provision, it is Program policy that the salary is understood to include public holiday pay amounts when the employee gets the day off. In that situation, the four steps outlined above would apply.
For employees who work five days a week and work the same number of hours each day, the result of the above-described four-step calculation will be that the employer will be in compliance so long as the employee is paid their usual salary and given the day off.
Public holiday pay is calculated as the total amount of regular wages earned plus the vacation pay payable in the four work weeks preceding the work week in which the public holiday falls, divided by 20. All regular wages earned and vacation pay payable to an assignment employee in the four-week period is included for the purposes of this calculation, regardless of the number of assignments the employee was on within that four-week period.
There were several significant changes to the public holiday pay provisions in 2018. The changes are detailed in the table below. The interpretation of the provisions that were previously in force are set out under the table. Since employees may still have claims relating to provisions that are no longer in force, the discussion of the former provisions remains as part of this publication. The text appears in red to highlight that these provisions are no longer in force.
| Date | Public Holiday Pay Formula |
|---|---|
| Prior to January 1, 2018 | “Pro-rating” formula
|
| January 1, 2018 – June 30, 2018 | “Averaging” formula
|
| July 1, 2018 – December 31, 2018 | “Pro-rating” formula
|
| January 1, 2019 – current | “Pro-rating” formula
|
“Pro-rating” formula: total amount of regular wages earned and vacation pay payable in the four work weeks before the work week in which the public holiday occurred, divided by 20.
“Averaging” formula: the total amount of regular wages earned in the pay period immediately preceding the public holiday, divided by the number of days the employee worked in that period. Additional provisions that were in effect January 1, 2018 to June 30, 2018 (ss. 24(1.1) and 24(1.2)) established rules for applying the averaging formula when an employee was on a personal emergency leave or vacation during the relevant pay period or was not employed during the relevant pay period.
The amount of public holiday pay owing for public holidays from January 1, 2018 to June 30, 2018, and for substitute holidays that were taken during that time period (regardless of when the public holiday for which the substitute holiday was earned occurred) was determined by now-repealed sections 24(1)(a), 24(1.1) and 24(1.2), as follows:
The calculation, which provides for an average day`s pay in respect of the public holiday, is made by taking the regular wages earned in the pay period immediately preceding the public holiday and dividing that amount by the number of days actually worked within that pay period. However, see ss. 24(1.1) and (1.2) below which set out those situations in which a pay period other than the pay period immediately preceding the public holiday is used to calculate public holiday pay.
For the purposes of counting the number of days the employee worked in the pay period, an employee is considered to have worked only one day in situations where their shift spans two calendar days. For example, one day is counted as having been worked where an employee works from 11:00 p.m. on one day to 7:00 a.m. on the next day.
Section 24(1.1) provides that if an employee is on a leave under ESA Part XIV, s. 50 (which was personal emergency leave at the time s. 24(1.1) was in force), or on vacation, or on a combination of ESA Part XIV, s. 50 personal emergency leave and vacation for the entire pay period immediately preceding the public holiday, the pay period to be used in the calculation in s. 24(1)(a) is the pay period preceding the start of that leave or vacation. Note that the employee must be on ESA Part XIV, s. 50 personal emergency leave or on vacation (or both) for the entire pay period for s. 24(1.1) to apply. If the employee is on personal emergency leave or on vacation for only part of the pay period immediately preceding the public holiday, that is the pay period that will be used in the calculation of public holiday pay.
Note that s. 24(1.1) applies only if the leave the employee takes is a leave of absence under the personal emergency leave provisions in ESA Part XIV, s. 50 for the entire pay period immediately preceding the public holiday. If the leave of absence that the employee is on in the pay period immediately preceding the public holiday is any other type of leave of absence, s. 24(1.1) does not apply. For example, if an employee was on a pregnancy or parental leave for all (or part) of the pay period immediately preceding a public holiday, her public holiday pay would be calculated on the basis of days worked and pay earned in the pay period immediately preceding the holiday. This could result in the employee receiving $0 as public holiday pay.
The question may arise as to what is considered the start of a ESA Part XIV, s. 50 personal emergency leave or vacation taken within the pay period preceding a public holiday if an employee has also taken leave or vacation days in the pay period prior to the pay period immediately preceding the public holiday.
It is the Program’s policy that if an employee takes days of personal emergency leave or vacation (or both) in that prior pay period that are consecutive with the personal emergency leave or vacation days taken in the pay period immediately preceding the public holiday, all of those days are together considered a single period of leave or vacation. For the purposes of s. 24(1.1) then, the leave or vacation starts on the first day of that single continuous period of personal emergency leave and/or vacation.
Because the employee works Monday through Friday in this example, the two ESA Part XIV, s. 50 personal emergency leave days taken May 10 and May 11 were taken consecutively with the five s. 50 leave days taken May 14 to May 18 and the personal emergency leave then started on May 10.
In accordance with s. 24(1.1), the public holiday pay for May 21 is calculated using the pay period preceding the start of the s. 50 personal emergency leave, that is April 29 to May 5.
It is also Program policy that in determining whether days are consecutive, you only look to the days the employee is regularly scheduled to work. For example, if an employee only regularly works one day a week and takes two vacation days (i.e., the one day in each week that they would have regularly worked), the two vacation days are considered consecutive.
Because the employee works Monday through Friday in this example, the two s. 50 personal emergency leave days taken May 10 and May 11 were taken consecutively with the personal emergency leave days and vacation days taken May 14 to May 18 and the leave then started on May 10.
In accordance with s. 24(1.1), the public holiday pay for May 21 is calculated using the pay period preceding the start of the leave, that is April 29 to May 5.
However, if an employee is on s. 50 personal emergency leave or vacation (or both) in that prior pay period that is not consecutive with the s. 50 personal emergency leave or vacation days taken in the pay period immediately preceding the public holiday, the leave or vacation starts in the pay period immediately preceding the public holiday. Therefore, pursuant to s. 24(1.1), public holiday pay would be calculated using the pay period prior to the pay period immediately preceding the public holiday as shown in the following example:
Because the vacation days taken April 26 and April 27 were not taken consecutively with the vacation days taken May 7 to May 19, the vacation started on May 7.
In accordance with s. 24(1.1), the public holiday pay for May 21 is calculated using the pay period preceding the start of the vacation, that is April 22 to May 5.
Under s. 24(1.2), employees who commence employment in the pay period that includes a public holiday are entitled to public holiday pay for that holiday based on the regular wages earned in the pay period that includes the public holiday divided by the number of days the employee worked in that period.
A question may arise regarding the calculation of the public holiday pay entitlement under s. 24(1.2) with respect to an employee who commences employment during the pay period in which the public holiday falls and who does not have a substitute day scheduled. In other words, the employee works on the holiday and is entitled to public holiday pay for the holiday and premium pay for the hours worked on the holiday.
For example, if an employee was hired during the pay period in which Family Day falls and agreed in accordance with ESA Part X, s. 27(2)(b) to work on Family Day, what is the public holiday pay entitlement for that day? The employee’s wages earned in the pay period would not include the premium pay for any hours worked or any public holiday pay paid in respect of Family Day as such wages do not fall within the definition of regular wages. As noted in the discussion of s. 24(1)(a), all days worked (including Family Day in this example) in the pay period would be included in the count for the number of days worked when calculating the public holiday pay for Family Day.
Employee:
In the pay period before the public holiday, the employee worked:
The employee was not absent on s. 50 personal emergency leave or vacation for the entire pay period immediately preceding the public holiday. Therefore, public holiday pay to be calculated using the pay period immediately preceding the public holiday.
To calculate public holiday pay:
$1160 ($20.00/hour times 58 hours worked)
Employee:
Per the employee’s contract, took three days off as floater days in the pay period immediately preceding the public holiday. Therefore, public holiday pay to be calculated using the pay period immediately preceding the public holiday.
To calculate public holiday pay:
Only regular wages are included in the calculation of public holiday pay. Regular wages is defined in ESA Part I, s. 1 to exclude overtime pay. Overtime pay as per Part VIII, s. 22(1) is not just the extra premium of .5 times the regular rate for each hour over the prescribed overtime threshold, but is the entire 1.5 times the regular rate for each hour worked over the prescribed overtime threshold. This means that all payment for hours worked over the prescribed threshold is excluded from the calculation.
Employee:
To calculate public holiday pay:
Note that although this employee’s average daily wage when you include overtime is $212 [(44 hours x $20) + (6 hours x $30) divided by 5], they are entitled only to $176.00 public holiday pay because overtime pay is excluded from the public holiday pay calculation.
Employee:
Although the employee was on s. 50 personal emergency leave during the pay period immediately preceding the public holiday the employee was not on personal emergency leave for the entire pay period. Therefore, public holiday pay is to be calculated using the pay period immediately preceding the public holiday.
To calculate public holiday pay:
Note that even if the employee had been paid for one or more of the personal emergency leave days pursuant to subsection 50(5), the amount paid would not be included in the public holiday pay calculation, since personal emergency leave pay is excluded from the definition of regular wages.
Employee:
To calculate public holiday pay:
Employee:
To calculate public holiday pay:
Because the employee was not employed in the pay period immediately preceding the public holiday, public holiday pay is calculated in accordance with s. 24.(1.2):
Note that if the employee had commenced employment on or after January 2, they would not be entitled to public holiday pay for January 1 because they were not yet in an employment relationship with the employer on the holiday.
The employee is subject to an averaging agreement and exceeds the weekly overtime threshold in a particular week, but does not receive overtime pay for those hours because of the averaging agreement. In this case, wages for all of the hours worked will be included in the calculation of public holiday pay.
Employee:
To calculate public holiday pay:
The employee is subject to an averaging agreement and exceeds the weekly overtime threshold in a particular week, and receives overtime pay for some of those hours because of the averaging agreement. In this case, those overtime wages will be excluded from the calculation of public holiday pay.
Employee:
To calculate public holiday pay:
Public holiday pay and premium pay are excluded from the definition of regular wages. This becomes relevant when a public holiday falls within the pay period immediately preceding a public holiday. For example, where Christmas Day and Boxing Day fall within one pay period and New Year’s Day falls in the next pay period.
Employee:
To calculate public holiday pay for New Year’s Day:
Employee:
To determine whether the proper amount of public holiday pay has been paid:
As the public holiday calculation netted the employee $100 and the employee only received $76.20 for the public holiday, a balance of $23.80 in public holiday pay is owed to the employee.
Note that if the public holiday fell on a workday other than Monday, the result would differ because of the different number of hours the employee works on their other workdays.
If a contract of employment provides that an employee is to be given public holiday pay in addition to their salary, then the employee gets the public holiday pay plus the regular salary. But, absent such a provision, it is Program policy that the salary is understood to include public holiday pay amounts when the employee gets the day off. In that situation, the four steps outlined above would apply.
For employees who work five days a week and work the same number of hours each day, the result of the above-described four-step calculation will be that the employer will be in compliance so long as the employee is paid their usual salary and given the day off.
This section sets out the rate that is to be used to calculate any premium pay an employee may be entitled to pursuant to other sections in Part X. It provides that the amount of premium pay shall be at least one and one half times an employee’s regular rate.
ESA Part I, s. 1 defines regular rate as follows:
As of the time of writing, there is no regulation made under paragraph 10 of ESA Part XXVII, s. 141(1) that provides a different definition of regular rate.
See ESA Part I, s. 1 for a discussion of the term regular rate, particularly as it applies to employees whose compensation consists of an hourly rate plus some other form of compensation.
These provisions were introduced in the Employment Standards Act, 2000. They codify policy that applied under the former Employment Standards Act.
These provisions state what happens when, during a work week in which a public holiday falls, an employee performs some work for an employer that is covered by Part X, and some work that is exempted from coverage of Part X by O Reg 285/01, s. 2 or s. 9.
In this situation, Part X will apply to that employee for that particular public holiday if 50 per cent or more of the employee’s hours during that work week were spent performing work that is not exempt.
It is only the work performed during the work week in which the public holiday falls that is reviewed when applying s. 25. For example, assume Work A is exempt from Part X, while Work B is covered by Part X. During each of the three work weeks prior to the public holiday, an employee spends 60 per cent of her time performing Work A (exempt work) and 40 per cent performing Work B (non-exempt work). However, during the work week the public holiday occurs, she spends 45 per cent of her time performing Work A (exempt work) and 55 per cent of her time performing Work B (non-exempt work). Because she spent 50 per cent or more of her time performing non-exempt work during the work week in which the public holiday fell, she will be entitled to the Public Holiday standard with respect to that particular public holiday. (The same review must be performed for each public holiday.)
This provision sets out an employee’s entitlement when a public holiday falls on a day that is ordinarily the employee’s working day and that is not during the employee’s vacation. See ESA Part X, s. 29 for the entitlement if a public holiday falls on a day that is not ordinarily an employee’s working day, or is during an employee’s vacation.
It is not always readily apparent which days are ordinarily working days for a given employee. Whether or not a holiday falls on a day that is ordinarily a working day for an employee will determine what the employee is entitled to for the holiday, and, in certain industries, whether or not the employer can require the employee to work on the holiday. For example, the question has arisen in the restaurant industry as to how to determine which days are ordinarily working days for part-time employees who have irregular shifts. It is Program policy that to make this determination, one looks at the days that the employee tells the employer that they are available to work and the past scheduling practice. For example, an employee is hired on the basis that they are available to work Mondays through Fridays, and is actually scheduled to work on each of those days (although not on any regular basis - e.g., Monday and Tuesday one week, Tuesday and Friday the next week, Wednesday and Thursday the next week, etc.). In this case, the Program would consider Mondays through Fridays to be days that would ordinarily be working days for that employee. However, if that same employee is only ever scheduled to work Tuesdays and Thursdays, the Program would consider only Tuesdays and Thursdays to be days that would ordinarily be working days for that employee, even though they said they were available all weekdays.
For employees who are on lay-off, a leave under ESA Part XIV, or any other leave of absence when a public holiday occurs, their pre-leave or pre-lay-off schedule determines whether the public holiday falls on a day that would or would not ordinarily be a working day for an employee, and thus whether s. 26 or s. 29 will apply to that particular public holiday.
For example, if an employee on parental leave worked Mondays to Fridays before the leave, Mondays to Fridays are days that are ordinarily working days for that employee, and Saturdays and Sundays are days that would not ordinarily be working days for that employee. Consequently, s. 26 will apply to any public holiday that falls on a weekday during that employee’s leave, and s. 29 will apply to any public holiday that falls on a weekend during that employee’s leave. In either case, the employee is entitled to public holiday pay for the holiday - see ESA Part X, s. 29(2.1). But because public holiday pay is based on regular wages earned and vacation pay payable in the four work weeks prior to the public holiday, an employee who was on a leave or lay-off for some or all of the four weeks prior to the public holiday, the quantum of public holiday pay to which they will be entitled will be less than the equivalent of a regular day’s pay [and in the case of an employee who was on a leave or lay-off for the entire four weeks, will be zero].
Some employees may have had a varying, irregular schedule before their leave or lay-off, such that it cannot be determined whether or not the employee would have been scheduled to work on the day the public holiday falls. In this case, because there are no days that "would ordinarily be a working day for" that employee, s. 29 will apply to any public holiday that occurs during the leave or lay-off.
See ESA Part XVIII.1, s. 74.10 for a discussion of the application of Part X to assignment employees of temporary help agencies, particularly the Program’s policy that a public holiday falls on a day that is ordinarily a working day for an assignment employee only if the employee is on assignment and the holiday falls on a day that they would be working pursuant to the assignment (assuming there had been no holiday). In that case only, ESA Part X, ss. 26, 27 or 28 would apply to determine the employee’s public holiday entitlements.
Section 26(1) states that when a public holiday falls on a day that is ordinarily an employee’s working day and the employee is not on vacation, the employee is to be given the public holiday off and paid public holiday pay. See ESA Part X, s. 24 for a discussion of public holiday pay.
The entitlement in s. 26(1) is subject to:
This section provides that employees are not entitled to the s. 26(1) entitlement of a public holiday off with public holiday pay if they fail, without reasonable cause, to work their entire regularly scheduled day of work before or after the holiday.
This section is intended to discourage employees from unilaterally taking an extra day off around the public holiday by failing to show up on the day they are expected to work before or after the holiday, or by showing up to work later or leaving earlier than expected before or after the holiday.
Reference to "regularly scheduled" relates to the schedule of the particular employee, not to the business hours of the employer. For example, an employee works Monday to Friday in a business that is open seven days a week. A holiday falls on a Monday. The employee would not be disqualified under this section because they did not work on Sunday. So long as they worked their entire scheduled shift on the Friday before the public holiday and the Tuesday after the public holiday, they will be considered to have worked the last regularly scheduled day before and the first regularly scheduled day after the public holiday.
If the employee in the above example had originally been scheduled to work on the Friday before the public holiday, but exchanged this shift with the employer’s approval, the effect of this change would be to alter their regularly scheduled day of work. So long as the employee worked the entire scheduled days on the Thursday before the holiday and the Tuesday after the holiday, they will be considered to have worked the last regularly scheduled day before and the first regularly scheduled day after the public holiday - see 472323 Ontario Limited c.o.b.a. the Weed Man v Clark (October 28, 1985) ESC 1971 (Kerry) a decision under the former Employment Standards Act.
In 398827 Ontario Limited c.o.b. Palangio Vending & Food Services v Guimond et al (May 31, 1982), ESC 1232 (Black), a decision under the former Employment Standards Act, the employer terminated the employees at a school cafeteria before Christmas, fully intending to rehire them after the New Year, so that they could claim Employment Insurance benefits. The referee held that the employees had worked their scheduled days before and after the holiday:
If the employer’s argument that the claimants were not employees on the holidays in question because they had been terminated was upheld, then surely nothing would prevent an unscrupulous employer from terminating an employee the day before each public holiday only to rehire the day after such holiday in order to avoid compliance with the legislation.
An employee will not be considered to have worked all of their last regularly scheduled day of work before the public holiday and all of their first regularly scheduled day of work after the public holiday if they did not work the entire scheduled shift on both of those days. However, if the employer allows the employee to leave early (or begin late), the employee would not be disqualified, since what constituted the full regularly scheduled day of work was adjusted by mutual consent. Note that agreements to adjust the schedule are not required to be in writing, as they are not agreements provided for in the ESA 2000.
What follows are some examples of situations in which an employee will not be considered to have failed to work their last regularly scheduled day of work before or first regularly scheduled day of work after the public holiday.
Where the last regularly scheduled work day before a public holiday or the first regularly scheduled day of work after a public holiday falls on a day that, although it would ordinarily have been a working day for the employee, is a day on which the employee is on a scheduled leave of absence, they will not be considered to have failed to work the "last before" or "first after"; since the employee was on a scheduled leave, work could not have been scheduled for them on that day. Leaves that are arranged in advance would fall into this category; examples would include sabbatical leaves and, if notice is given in advance of the start date, leaves under ESA Part XIV.
Where advance notice is not given, as is often the case with some ESA Part XIV leaves, the leave would obviously not be considered to have been arranged in advance; however, an employee who misses the last before or first after because of taking such leave would not lose the public holiday entitlement because of the reasonable cause exception to the "last before and first after" requirement. See the discussion in under Reasonable Cause below.
Where the last regularly scheduled work day before a public holiday or the first regularly scheduled day of work after a public holiday falls on a day that, while it would ordinarily have been a working day for the employee, is a day on which the employee is on vacation, they will not be considered to have failed to work the last before or first after; since the employee was on vacation, work could not have been scheduled for them on that day.
Where the last regularly scheduled work day before a public holiday or the first regularly scheduled day of work after a public holiday falls on a day that, while it would ordinarily have been a working day for the employee, is a day on which the employee is on lay-off, they will not be considered to have failed to work the last before or first after; since the employee was on lay-off, work would not have been scheduled for them on that day.
A person who resigns or whose employment is terminated immediately after the public holiday (i.e., before the commencement of what would have been their first regularly scheduled day of work after the holiday) is not considered to have failed to work the first regularly scheduled day of work after the public holiday. Since the individual was no longer employed on that day, work could not have been scheduled for them on that day. However, an employment relationship must have still existed between the parties on the public holiday itself. For example, if the employment of an employee who regularly works Monday through Friday each week is terminated at the end of their shift on the Friday preceding the public holiday (which falls on the following Monday), they would have no public holiday entitlement for the Monday. If however, the employment was terminated when the employee arrived at work on the Tuesday morning following the holiday, the entitlement would be maintained because there was an employment relationship on the day of the public holiday.
An employee who has been suspended by the employer on a day that would otherwise have been the last regularly scheduled day before a public holiday or the first regularly scheduled day after a public holiday is not considered to have failed to work the last before or first after. Since the employee was on suspension, work could not have been scheduled for them on that day.
Note that s. 26(2) provides that an employee will not lose their public holiday entitlement, despite not having worked all of their last regularly scheduled day of work before the holiday or the first regularly scheduled day of work after the holiday, if they had reasonable cause for having failed to do so. What constitutes reasonable cause is discussed in the next section.
Employees who do not work their entire regularly scheduled shifts before or after the public holiday will not lose their right to a paid day off if they had reasonable cause for failing to perform the work.
The onus is on the employee to show that there was reasonable cause. Usually, reasonable cause will be something beyond the control of the employee, although this is not always the case. What follows are some examples of situations where reasonable cause may or may not exist:
An employee may claim that their failure to report may be due to the breakdown of their car, but if alternate transportation was readily available, this would not be considered to be reasonable cause. However, if the employee did take public transit and arrived late for their shift, this may be considered reasonable cause.
Reasons such as "slept in" or "too tired" will generally not amount to reasonable cause. However, if the reason the employee slept in is because there was a power failure and the employee’s alarm clock did not go off as a result, that may amount to reasonable cause.
As was discussed above, an employee who gives advance notice that they are taking a Part XIV leave and for whom what would otherwise have been the last regularly scheduled day of work before the holiday or first regularly scheduled day of work after the holiday falls during the leave will not be considered to have failed to work the last before or first after; this is because work cannot be scheduled where the employer knows beforehand that the employee will be on leave. However, where the employee had to commence the leave without advance notice, they will not lose the public holiday entitlement despite not working the last before or first after; although work was scheduled, the employee had reasonable cause for not working.
Sick leave, family responsibility leave and bereavement leave under ESA Part XIV, are, because of the nature of the events for which they can be taken, often not possible to be arranged in advance; therefore, an employee who had to take sick leave, family responsibility leave or bereavement leave on a day that is the last regularly scheduled day of work before or the first regularly scheduled day of work after the public holiday would arguably - if no advance notice was given - be regarded as having failed to work on the last regularly scheduled day before or the last regularly scheduled day after, as the case may be. However, it is Program policy that an employee who is away for any reason listed in s. 50(1), or in s. 50.0.1(1) or s. 50.0.2(1) with respect to any person in a category listed in s. 50.0.1(3) or s. 50.0.2.(3), will be considered to have reasonable cause. See the discussion of the sick leave, family responsibility leave and bereavement leave provisions in ESA Part XIV.
This policy applies even if the employee was not exercising a right to sick leave, family responsibility leave or bereavement leave because they already "used up" the leave days provided for under the ESA 2000. If an employee fails to work their last regularly scheduled day of work before or first regularly scheduled shift after the public holiday because of a reason listed in s. 50(1), or for a reason listed in s. 50.0.1(1) or s. 50.0.2(1) with respect to a person listed in s. 50.0.1(3) or s. 50.0.2(3), the Program will consider that employee to have reasonable cause.
On the other hand, just because an employee is away for a reason that is not listed in s. 50(1), or in the case of family responsibility leave or bereavement leave that does not relate to a person listed in s. 50.0.1(3) or s. 50.0.2(3), does not necessarily mean that the employee does not have reasonable cause. While any event that entitles an employee to take sick leave, family responsibility leave or bereavement leave will constitute reasonable cause, the opposite is not necessarily true. That is, s. 50, s. 50.0.1 and s. 50.0.2 do not provide an exhaustive list of what constitutes reasonable cause for the purposes of the public holiday provisions. Whether or not an event that does not fall within s. 50, s. 50.0.1 or s. 50.0.2 amounts to reasonable cause for the purpose of s. 26(2) will depend on the circumstances. For example, an employee may fail to work their regularly scheduled day of work before a public holiday because their neighbour had a medical emergency and needed the employee's assistance. Although this employee is not entitled to a family responsibility leave of absence because "neighbours" are not listed in s. 50.0.1(3), the employee may have reasonable cause for the purpose of s. 26(2), depending on all of the circumstances.
The same approach applies to personal emergency leave taken under the previous provisions, in force prior to January 1, 2019. Also note that s. 50(13) of the previous personal emergency leave provisions prohibited an employer from requiring that the employee provide a certificate from a qualified health practitioner: therefore, an employee could not be required to produce such a certificate to support an entitlement to public holiday pay when the employee took personal emergency leave during all or part of the time the employee was scheduled to work on a public holiday. However, an employee could be required to provide evidence reasonable in the circumstances per the previous version of s. 50 (12) and to support reasonable cause per ESA Part X, ss. 26(2), 27, 28 or 29.
Also note that s. 50(13) of the personal emergency leave provisions prohibits an employer from requiring that the employee provide a certificate from a qualified health practitioner: therefore, an employee cannot be required to produce such a certificate to support an entitlement to public holiday pay when the employee takes personal emergency leave during all or part of the time the employee was scheduled to work on a public holiday. However, an employee may be required to provide evidence reasonable in the circumstances per s. 50 (12) and to support reasonable cause per ESA Part X, ss. 26(2), 27, 28 or 29.
It is Program policy that an employee represented by a trade union who is on a lawful strike on the last regularly scheduled shift before or first regularly scheduled shift after a public holiday will be considered to have reasonable cause. Employees on an unlawful strike will be considered to not have reasonable cause.
Note that an employee who is entitled to a substitute holiday pursuant to s. 27(2)(a) does not lose that entitlement if they fail without reasonable cause to work all of their last regularly scheduled day of work before or first regularly scheduled day of work after the substitute holiday. An employee does not have to "requalify" for the substitute holiday once they have already earned it.
As discussed above, employees may lose the entitlement to public holiday pay or a substitute day off with public holiday pay if the employee fails, without reasonable cause, to work all of their last regularly scheduled working day before the holiday or all of their first regularly scheduled working day after the holiday.
The Program’s position is that an assignment employee will not be considered to have failed to work the last regularly scheduled working day before the holiday or first regularly scheduled working day after the holiday if they work on the last day they were supposed to work before the holiday and the first day they were supposed to work after the holiday in accordance with their assignment or assignments (if any). Note that if the employee does fail to work either of those days, they may still be entitled to the public holiday entitlements so long as they had reasonable cause for not working the day(s).
The following examples are intended to provide guidance in determining the public holiday entitlements of assignment employees pursuant to ESA Part X, ss. 24 through 32, ESA Part XVIII.1, ss. 74.10(1) and (2) (as applicable) as well as ESA Part XVIII.1, s. 74.11 and in accordance with Program policy with respect to those provisions, including the Program’s policy as described above:
An employee was on a two-week assignment working Monday through Thursday each week. Their previous assignment ended two months earlier. The current assignment began one week prior to the week Thanksgiving Day (Monday) occurs and ended the Thursday following the holiday. What are her entitlements with respect to the public holiday?
The employee was on assignment when the holiday occurred and would ordinarily have worked on the day the holiday fell (pursuant to their assignment) and so is entitled to Thanksgiving Day as a day off with public holiday pay for the day - see s. 26(1).
The employee will pass the last and first day test if they worked the Thursday prior to the holiday as well as the Tuesday following the holiday, or had reasonable cause if they failed to work either of those days as per s. 26(2).
The public holiday pay would be calculated as the regular wages earned and vacation pay payable in the four work weeks before the work week in which the public holiday occurred, divided by 20 – see ESA Part X, s. 24(1). Assume that the public holiday occurs after July 1, 2018, so that s. 24(1)(a) does not apply in this example.
Note that if the employee had taken more than one assignment from the agency in the four work weeks before the holiday, the calculation of public holiday pay would have been based on the total regular wages earned and vacation pay payable in respect of both of those assignments.
An assignment employee was hired by a temporary help agency on October 1, 2017. Their most recent assignment ended on July 15, 2018 and at the end of August 2018, they advised the agency that because of other commitments they would not be prepared to accept any new assignments until the beginning of October 2018. What are this employee’s entitlements with respect to Labour Day, (the first Monday in September)?
The assignment employee was an employee of the agency on Labour Day. Because they were not assigned to perform work for a client at that time, the holiday fell on a day that was not ordinarily a working day - see ESA Part X, s. 29(1).
Because they were not on an assignment on the day on which Labour Day fell they are on a lay-off pursuant to ESA Part XVIII.1, s. 74.10(1). ESA Part X, s. 29(2.1) applies to determine their entitlements. They are therefore entitled to public holiday pay for the day. However, as they had not earned any wages in the four work weeks before Labour Day, their public holiday pay is $0.
An employee was on an assignment from January 15 to May 1 and was scheduled to work only Tuesdays and Thursdays of each week. What are their entitlements with respect to the public holidays that fell during this assignment?
There were two public holidays during this assignment: Family Day (Monday) and Good Friday (Friday).
Because Mondays and Fridays were not days that the employee was ordinarily scheduled to work pursuant to their assignment, their public holiday entitlements would be determined under ESA Part X, s. 29.
As they were on an assignment from January 15 to May 1 when the holidays fell they are not considered to be on a lay-off pursuant to ESA Part XVIII.1, s. 74.10(1) for the purposes of s. 29(2.1).
As a result, s. 29(1) applies and they are entitled to a substitute day off for both Family Day and Good Friday with public holiday pay calculated as if the substitute days were the public holidays. This means that the substitute holiday takes the place of the public holiday. Therefore, the formula to be used for calculating public holiday pay for the substitute holiday would be the formula that is in effect on the date of the substitute holiday.
As per s. 29(2) the substitute days must be scheduled within three months following the public holidays or within 12 months if the employee and employer agree. As per s. 29(2.1), the employer must provide the employee with a written statement that sets out the date of the day that is substituted for the public holiday.
This section provides an exception to the entitlement in ESA Part X, s. 26, which provides employees with the right to the public holiday off with public holiday pay if the holiday falls on a day that is ordinarily an employee’s working day and the employee is not on vacation. Section 27(1) allows such employees and their employers to agree that the employee will work on the public holiday. If an agreement is reached, the entitlements set out in s. 27(2) will apply instead of those set out in s. 26.
Any agreement that the employee will work on the public holiday must be in writing. See ESA Part 1, s. 1(3) and (3.1) for a discussion of agreements and voluntary consent. The agreement must be reached prior to the date of the public holiday.
If an employee works on a public holiday but there is no proper written agreement in place, the "alternate" standard of s. 27 will not apply and, accordingly, the employee’s entitlement will be determined under the "default" standard of s. 26. This is so even if there was an oral agreement that the employee would work on the public holiday - see the discussion of the written agreement requirements at ESA Part I, s. 1(3) and s. 1(3.1). The ESA 2000 permits employees and employers to opt into the alternate standard of s. 27 only where there is a written agreement. Where there is no written agreement, the default standard of s. 26 will apply to the employee. In this case, an officer would apply the requirements of s. 26 when determining what violations have occurred. The requirements of s. 26 are:
For example, where an employee worked on a public holiday without providing their written agreement and was paid their regular rate, the officer could find that there has been a non-monetary violation of the requirement that the employee receive the public holiday off, and a monetary violation of the requirement that the employee be paid public holiday pay.
In determining how much money the employer owes the employee, the amount of public holiday pay owing would NOT be offset by the amount of wages earned by the employee for working on the holiday. The employee earned those wages for working and must be paid in addition to the amount of public holiday pay owing. This would be so even if the employer paid the employee a higher rate for working on the public holiday, such as 1.5 times the employee’s regular rate. Again, the higher rate of wages was earned by the employee for working on the public holiday and must be paid in addition to the amount of public holiday pay owing.
Note that this section applies to employees in all operations, including hospitals, continuous operations, and hotels, motels, tourist resorts, restaurants and taverns, who agree to work on a public holiday that falls on a day that is ordinarily a working day for them. Employees who are employed in a hospital, continuous operation, or hotel, motel, tourist resort, restaurant or tavern who are required to work on a public holiday that is ordinarily a working day for the employee and that is a day the employee is not on vacation are governed by ESA Part X, s. 28.
This section sets out to what an employee who agreed to work on a public holiday pursuant to s. 27(1) is entitled.
The default entitlement for such an employee is:
plus
plus
However, if an employer and employee agree in writing, the employee is entitled to public holiday pay plus premium pay for each hour worked on the public holiday, rather than to the default entitlement.
See ESA Part I, s. 1(3) for a discussion of agreements in writing.
See ESA Part X, s. 24 for the calculation of public holiday pay and premium pay.
If the employee does not agree in writing to receive public holiday pay plus premium pay, then the entitlement in s. 27(2)(a) will apply. The alternate entitlement of s. 27(2)(b) applies only if there is such a written agreement. If there is no such written agreement, the default entitlement of s. 27(2)(a) will apply. This assumes that there was a written agreement in place for the employee to work on the holiday, as required by s. 27(1). If there was no written agreement to work on the holiday, then the default standard of s. 26 will apply, rather than s. 27. See ESA Part X, s. 26 for more details.
The entitlements described above are subject to s. 27(4), discussed below.
The Fair Workplaces, Better Jobs Act, 2017, SO 2017, c 22, added s. 27(2.1) to the ESA 2000, effective January 1, 2018. Where the employee has agreed to work on a public holiday and the employer is substituting the public holiday in accordance with s. 27(2) (a), this section requires the employer to provide the employee with a written statement:
The written statement must be provided to the employee before the actual public holiday. The legislation does not specify the manner in which the written statement must be provided. Consistent with the Program’s position regarding the provision of the poster under ESA Part III, s. 2(5), an employer may provide the statement as a printed copy or as an attachment in an email to the employee.
There is no requirement for the parties to sign the written statement, nor is there a requirement for the employee to agree to the date of the substitute holiday, so long as it is a day that would ordinarily be a working day for the employee and that it is scheduled for a day before the deadlines set out in s. 27(3), discussed below.
27(3) A day that is substituted for a public holiday under clause (2)(a) shall be,
This section establishes a deadline for scheduling a substitute holiday an employee earns pursuant to s. 27(2)(a).
The section states that the employer must schedule the substitute holiday (which, pursuant to s. 27(2)(a), must be set for a day that is ordinarily a working day for the employee) for a day that is no later than three months after the date of the public holiday.
The substitute day can be taken before the actual public holiday itself. For example, Canada Day is on a Tuesday. It is not a violation of the ESA 2000 for an employee who has agreed in writing to work on Canada Day to be given Monday, June 30, as the substitute holiday. If the employer and employee agree in writing, the substitute holiday can be scheduled for a day that is up to 12 months after the date of the public holiday. An employee may wish to extend the three-month deadline if, for example, they want to tack the substitute holiday on to their next vacation but the vacation is more than three months away. See ESA Part 1, s. 1(3) and (3.1) for a discussion of written agreements and voluntary consent.
The written agreement contemplated in s. 27(3)(b) must be made prior to the public holiday as the employer is required under s. 27(2.1) to give the employee a written statement setting out the date of the substitute day.
This section simply sets out the entitlements for an employee who agreed in writing to work on the public holiday pursuant to s. 27(1), but who fails to perform certain work.
Every situation that impacts on an employee’s entitlement is covered. That is, this provision sets out the consequences in the event of any of the following circumstances, whether they occur on their own or in combination with one another:
In the discussion below:
The statutory phrases, "performs none of the work that he or she agreed to perform on the public holiday" and "performs some of the work that he or she agreed to perform on the public holiday but fails . . . to perform all of it" do not refer to the quantity or quality of the employee’s work. Rather, it refers to whether the employee worked the whole shift, part of the shift, or none of the shift they agreed to work on the public holiday.
For example, an employee who agreed to work an eight-hour shift on Canada Day and who usually assembles 100 widgets during an eight-hour shift will not be considered to have performed only some of the work merely because they assembled only 80 widgets on Canada Day. So long as the employee worked through the entire eight-hour shift, they will have performed all of the work they agreed to perform on the holiday.
The situations and consequences addressed in each of the five paragraphs in s. 27(4) are as follows:
Employee performs none of the work on the public holiday, (i.e., did not show up at all for the shift, without reasonable cause: Employee has no entitlement.
Pursuant to s. 27(4) paragraph 1, the employee has no entitlement of any sort under s. 27(2): not to a substitute holiday, to public holiday pay or to premium pay. When the employee entered into the s. 27(1) agreement, the general entitlement under ESA Part X, s. 26 ceased to apply to that employee.
Employee performs none of the work on the public holiday, (i.e., did not show up at all for the shift), with reasonable cause, employee entitled to:
or
Pursuant to s. 27(4) paragraph 2, the employee is entitled to a substitute holiday or public holiday pay if the employee agreed to be paid public holiday pay and premium pay instead of receiving a substitute holiday.
Employee:
and
Pursuant to s. 27(4) paragraph 2, the employee has no entitlement of any sort: not to a substitute holiday, to public holiday pay or to premium pay. When the employee entered into the s. 27(1) agreement, the general entitlement under ESA Part X, s. 26 ceased to apply to that employee.
Employee performs some but not all of the work they agreed to perform on the public holiday, (i.e., showed up for only part of the shift), without reasonable cause: Employee entitled only to premium pay for each hour worked on the public holiday.
Pursuant to s. 27(4) paragraph 3, the employee is entitled only to premium pay for each hour worked on the public holiday. They have no other entitlements to public holiday pay or a substitute holiday.
Employee performs some but not all of the work they agreed to perform on the public holiday, (i.e., showed up for only part of the shift), with reasonable cause, employee entitled to:
or
Pursuant to s. 27(4) paragraph 4, the employee is entitled to wages at their regular rate plus a substitute holiday, or public holiday pay plus premium pay if the employee agreed to they were going to work on the public holiday instead of receiving a substitute holiday.
Employee:
and
Employee entitled only to premium pay for each hour worked on the public holiday.
Pursuant to s. 27(4) paragraph 4, the employee is only entitled to premium pay for each hour worked on the public holiday. They have no other entitlements.
Employee:
but
Employee entitled only to premium pay for each hour worked on the public holiday.
Pursuant to s. 27(4) paragraph 5, the employee is entitled only to premium pay. They have no other entitlements
Note: An employee who is entitled to a substitute holiday pursuant to s. 27(2)(a) does not lose that entitlement if they fail without reasonable cause to work all of their regularly last regularly scheduled day of work before or first regularly scheduled day of work after the substitute holiday. An employee does not have to "requalify" for the substitute holiday once they have already earned it.
This section provides a second exception to the entitlement in ESA Part X, s. 26(1) to a public holiday off with public holiday pay. The first exception is found in ESA Part X, s. 27. Section 28(1) allows some flexibility in certain operations that cannot reasonably be expected to shut down on public holidays, and permits employers to require employees in these operations to work on a public holiday. The entitlement for an employee in these operations who is required to work on a public holiday is set out in s. 28(2).
The terms "hospital" and "continuous operation" are defined in ESA Part I, s. 1.
In order for s. 28 to apply, the employee must be employed "in" a hospital, continuous operation, hotel, motel, tourist resort, restaurant or tavern. A question has arisen as to whether s. 28 will apply to employees who work for a call centre that deals exclusively with making hotel reservations. It is Program policy that s. 28 will not apply in that case (assuming that the call centre is not actually located in the hotel, and assuming that the call centre is not a continuous operation), since such employees are employed in a call centre, not in a hotel.
Note that the employer’s ability to require employees in these operations to work on the public holiday applies only if the holiday falls on a day that is ordinarily a working day for that employee and is a day the employee is not on vacation. If the holiday falls on a day that is not ordinarily a working day for the employee in these operations, or on a day the employee is on vacation, ESA Part X, s. 29 applies and the employee has a choice of whether or not to work on the holiday, if requested – see ESA Part X, s. 26(1) for a discussion on how to determine whether or not a public holiday falls on a day that is ordinarily a working day for an employee who has an irregular schedule.
Note also that Part XVII Retail Business Establishments has the effect of granting some of the above employees the right to refuse to work on a public holiday, if they work in a retail business establishment, despite s. 28(1). Specifically, "retail" employees who work in a continuous operation (e.g., a 24-hour convenience store) have the right to refuse to work on public holidays, even if the holiday falls on a day that is ordinarily their working day. For further discussion, please refer to ESA Part XVII Retail Business Establishments.
Further note that the employer’s ability to require employees to work on a public holiday is also subject to the employee’s right to take a day off for purposes of religious observance under the Ontario Human Rights Code, RSO 1990, c H.19, and to the terms of the employee’s employment contract, which may state, for example, that an employee cannot be required to work on public holidays (and, as well, the requirements in the ESA 2000 regarding hours of work and daily and weekly/bi-weekly rest provisions).
This section sets out what an employee who is required to work on a public holiday pursuant to s. 28(1) is entitled to.
The entitlement for such an employee is either:
plus
or
The employer chooses which of the options above to provide the employee. This feature of s. 28 distinguishes it from the entitlements under s. 27 and s. 30, where the first option is the default entitlement and the second option applies only if the employee agrees in writing.
The entitlement in s. 28(2) is subject to s. 28(4).
An issue has arisen as to the appropriate remedy where an employer requires an employee to work on the public holiday but neither provides a substitute holiday, nor pays the employee premium pay or public holiday pay. The question is which clause - (a) or (b) - should the officer assess under. In these cases, the officer looks for evidence as to whether the employer provided the employee with a written statement setting out the day that was to be substituted for the public holiday as required by s. 28(2.1). If there was no statement provided to the employee, it is Program policy that the officer will assess under clause (b).
If the officer assesses under clause (a), they will not be able to order a substitute holiday for the employee if the three-month deadline for taking the substitute holiday has already passed, because to do so would not be in accordance with s. 28(3)(a) - although the parties could, of course, agree to such a result on their own.
Subsection 28(2.1) is a new provision added by the Fair Workplaces, Better Jobs Act, 2017, SO 2017, c 22, effective January 1, 2018. Where the employee has agreed to work on a public holiday and the employer is substituting the public holiday in accordance with s. 28(2)(a), this section requires the employer to provide the employee with a written statement:
The written statement must be provided to the employee before the actual public holiday. The legislation does not specify the manner in which the written statement must be provided. Consistent with the Program’s position regarding the provision of the poster under ESA Part II, s. 2(5), an employer may provide the statement as a printed copy or as an attachment in an email to the employee.
There is no requirement for the parties to sign the written statement, nor is there a requirement for the employee to agree to the date of the substitute holiday, so long as it is a day that would ordinarily be a working day for the employee and that it is scheduled for a day before the deadlines set out in s. 28(3).
This section establishes a deadline for scheduling a substitute holiday an employee earns pursuant to s. 28(2)(a).
The section states that the employer must schedule the substitute holiday (which, pursuant to s. 28(2)(a), must be set for a day that is ordinarily a working day for the employee) for a day that is no later than three months after the date of the public holiday.
The substitute day can be taken before the actual public holiday itself. For example, Canada Day is on a Tuesday. It is not a violation of the ESA 2000 for an employee who was required to work on Canada Day to be given June 30, for example, as the substitute holiday.
If the employer and employee agree in writing, the substitute holiday can be scheduled for a day that is up to 12 months after the date of the public holiday. See ESA Part I, s. 1(3) and (3.1) regarding agreements in writing. An employee may wish to extend the three-month deadline if, for example, they want to tack the substitute holiday on to their next vacation but the vacation is more than three months away.
The written agreement contemplated in s. 28(3)(b) must be made prior to the public holiday as the employer is required under s. 28(2.1) to give the employee a written statement setting out the date of the substitute day. See ESA Part 1, s. 1(3) for a discussion of issues surrounding agreements, e.g., retroactivity, specificity, and requirements regarding informed and voluntary consent.
This section sets out the entitlements for an employee who was required to work on the public holiday pursuant to s. 28(1), but who fails to perform certain work.
Every situation that impacts on an employee’s entitlement is covered. That is, this provision sets out the consequences in the event of any of the following circumstances, whether they occur on their own or in combination with one another:
In the discussion below:
The statutory phrases, "performs none of the work that he or she required to perform on the public holiday" and "performs some of the work that he or she required to perform on the public holiday but fails . . . to perform all of it," does not refer to the quantity or quality of the employee’s work. Rather, it refers to whether the employee worked the whole shift, part of the shift, or none of the shift they were required to work on the public holiday.
For example, an employee who was required to work an eight-hour shift on Canada Day and who usually assembles 100 widgets during an eight-hour shift will not be considered to have performed only some of the work merely because they assembled only 80 widgets on Canada Day. So long as the employee worked the entire eight-hour shift, they will have performed all of the work they were required to perform on the holiday.
The situations and consequences addressed in each of the five paragraphs in s. 28(4) are:
Employee performs none of the work on the public holiday, (i.e., did not show up at all for the shift), without reasonable cause, employee has no entitlement.
Pursuant to s. 28(4), paragraph 1, the employee has no entitlement of any sort: not to a substitute holiday, to public holiday pay or to premium pay. When the employee was required to work on the public holiday, ESA Part X, s. 26 and s. 27 and the entitlements available under those provisions no longer applied to that employee.
Employee performs none of the work on the public holiday, (i.e., did not show up at all for the shift), with reasonable cause, employee entitled to:
or
Pursuant to s. 28(4) paragraph 2, the employer chooses which to give the employee: a substitute holiday or public holiday pay.
Employee:
and
Employee has no entitlement.
Pursuant to s. 28(4) paragraph 2, the employee has no entitlement of any sort: not to a substitute holiday, to public holiday pay or to premium pay. When the employee was required to work pursuant to s. 28(1), s. 26 and s. 27 and the entitlements available under those provisions no longer applied.
Employee performs some but not all of the work they were required to perform on the public holiday (i.e., showed up for only part of the shift) without reasonable cause:
Employee entitled only to premium pay for each hour worked on the public holiday.
Pursuant to s. 28(4) paragraph 3, the employee is entitled only to premium pay for each hour worked on the public holiday. They have no other entitlements - not to public holiday pay or to a substitute holiday.
Employee performs some but not all of the work they agreed to perform on the public holiday, (i.e., showed up for only part of the shift), with reasonable cause, employee entitled to:
Pursuant to s. 28(4) paragraph 4, the employer chooses which to give the employee: wages at the regular rate plus a substitute holiday, or public holiday pay plus premium pay.
Employee:
and
Employee entitled only to premium pay for each hour worked on the public holiday.
Pursuant to s. 28(4) paragraph 4, the employee is only entitled to premium pay for each hour worked on the public holiday.
Employee:
but
Employee entitled only to premium pay for each hour worked on the public holiday.
Pursuant to s. 28(4) paragraph 5, the employee is only entitled to premium pay for each hours worked on the public holiday.
Note: An employee who is entitled to a substitute holiday pursuant to s. 28(2)(a) does not lose that entitlement if they fail without reasonable cause to work all of their last regularly scheduled day of work before or first regularly scheduled day of work after the substitute holiday. An employee does not have to "requalify" for the substitute holiday once they have already earned it.
This provision sets out an employee’s entitlement when a public holiday falls on a day that is not ordinarily the employee’s working day, or is during the employee’s vacation.
This provision applies to employees in all operations, including hospitals, continuous operations, and hotels, motels, tourist resorts, restaurants and taverns. See Part X, ss. 26-28 for the entitlements if a public holiday falls on a day that is ordinarily an employee’s working day and that is not during an employee’s vacation.
It is not always readily apparent which days are ordinarily working days for a given employee. Whether or not a holiday falls on a day that is ordinarily a working day for an employee will determine what the employee is entitled to for the holiday, and, in certain industries, whether or not the employer can require the employee to work on the holiday. For example, the question has arisen in the restaurant industry as to how to determine which days are ordinarily working days for part-time employees who have irregular shifts. It is Program policy that to make this determination, one looks at the days that the employee tells the employer that they are available to work and the past scheduling practice. For example, an employee is hired on the basis that they are available to work Mondays through Fridays, and is actually scheduled to work on each of those days (although not on any regular basis, e.g., Monday and Tuesday one week, Tuesday and Friday the next week, Wednesday and Thursday the next week, etc.). In this case, the Program would consider Mondays through Fridays to be days that would ordinarily be working days for that employee. However, if that same employee is only ever scheduled to work Tuesdays and Thursdays, the Program would consider only Tuesdays and Thursdays to be days that would ordinarily be working days for that employee, even though they said they were available all weekdays.
For employees who are on lay-off, a leave under ESA Part XIV, or any other leave of absence when a public holiday occurs, their pre-leave or pre-lay-off schedule determines whether the public holiday falls on a day that would or would not ordinarily be a working day for an employee, and thus whether s. 26 or s. 29 will apply to that particular public holiday. For example, if an employee on parental leave worked Mondays to Fridays before the leave, Mondays to Fridays are days that are ordinarily working days for that employee, and Saturdays and Sundays are days that would not ordinarily be working days for that employee. Consequently, s. 26 will apply to any public holiday that falls on a weekday during that employee’s leave, and s. 29 will apply to any public holiday that falls on a weekend during that employee’s leave.
Some employees may have had a varying, irregular schedule before their leave or lay-off, such that it cannot be determined whether or not the employee would have been scheduled to work on the day the public holiday falls. In this case, because there are no days that, in the words of s. 26, "would ordinarily be a working day for" that employee, s. 29 will apply to any public holiday that occurs during the leave or lay-off.
See ESA Part XVIII.1, s. 74.10 for a discussion of the application of Part X to assignment employees of temporary help agencies, particularly the Program’s policy that a public holiday will be considered to fall on a day that is ordinarily a working day for an assignment employee only if the employee is on assignment and the holiday falls on a day that they would be working pursuant to the assignment (assuming there had been no holiday). In that case only, s. 26, 27 or 28 would apply to determine an assignment employee’s public holiday entitlements. In all other cases, s. 29 would apply. Note that s. 29(2.1) and s. 29(2.2) must be read together with s. 74.10.
When a public holiday falls on a day that is not ordinarily an employee’s working day or is during an employee’s vacation, the employee is to be given a substitute day off, which must be:
In addition, the employer must provide the employee a written statement setting out specifics about the substitute holiday, as outlined in s. 29(1.1) below.
The entitlement to a substitute day under s. 29 is subject to:
Subsection 29(1.1) is a new provision added by the Fair Workplaces, Better Jobs Act, 2017, SO 2017, c 22, effective January 1, 2018. Where the employer is substituting the public holiday in accordance with s. 29(1), this section requires the employer to provide the employee with a written statement:
The written statement must be provided to the employee before the actual public holiday. The legislation does not specify the manner in which the written statement must be provided. Consistent with the Program’s position regarding the provision of the poster under ESA Part II, s. 2(5), an employer may provide the statement as a printed copy or as an attachment in an email to the employee.
There is no requirement for the parties to sign the written statement, nor is there a requirement for the employee to agree to the date of the substitute holiday, so long as it is a day that would ordinarily be a working day for the employee and that it is scheduled for a day before the deadlines set out in ESA Part X, s. 29(2).
This section establishes a deadline for scheduling a substitute holiday an employee earns pursuant to s. 29(1).
The section states that the employer must schedule the substitute holiday (which, pursuant to s. 29(1), must be set for a day that is ordinarily a working day for the employee) for a day that is no later than three months from the date of the public holiday.
The substitute day can be taken before the actual public holiday itself. For example, Canada Day is on a Saturday. It is not a violation of the Act for an employee whose ordinary working days are Mondays to Fridays to be given Friday, June 30, as the substitute holiday.
If the employer and employee agree in writing, the substitute holiday can be scheduled for a day that is up to 12 months after the date of the public holiday. See ESA Part I, ss. 1(3) and (3.1) for a discussion of written agreements. An employee may wish to extend the three-month deadline if, for example, they want to tack the substitute holiday on to their next vacation but the vacation is more than three months away.
The written agreement contemplated in s. 29(2)(b) must be signed prior to the public holiday as the employer is required under s. 29(1.1) to give the employee a written statement setting out the date of the substitute day.
This section provides that where an employee is on a pregnancy leave, parental leave, or lay-off when a public holiday falls, and it falls on a day that is not ordinarily a working day for that employee, the employee is entitled only to public holiday pay for the holiday, rather than to the substitute day with public holiday pay provided for in s. 29(1).
Note that s. 29(2.1) does not apply to an employee on a Part XIV leave other than pregnancy or parental leave. Thus, if an employee is on sick leave, family responsibility leave, bereavement leave, family medical leave, family caregiver leave, critical illness leave, domestic or sexual violence leave, crime-related child disappearance leave, child death leave, reservist leave, organ donor leave, or declared emergency leave when a public holiday falls and it falls on a day that would not ordinarily be a working day for the employee, the employee will be entitled to the substitute day with public holiday pay provided by s. 29(1).
Note also that because the amount of public holiday pay owing is based on the wages earned by an employee in the four work weeks prior to the public holiday, the amount of public holiday pay to which an employee who was on pregnancy or parental leave or lay-off for any time during those four weeks will be less than what the employee’s entitlement would have been had the employee not been on leave or lay-off for any part of those four weeks.
In the case of an employee who is on lay-off (as opposed to pregnancy or parental leave), s. 29(2.1) must be read in conjunction with s. 29(2.2).
For information about the application of s. 29(2.1) to assignment employees of temporary help agencies, see ESA Part XVIII.1, s. 74.10.
This section states that s. 29(2.1) will not apply to employees who are on lay-off if their employment has been terminated pursuant to ESA Part XV, s. 56(1)(c). For example, an employee is on lay-off for more than 13 weeks in any period of 20 consecutive weeks. None of the conditions in s. 56(2)(b) or (c) that would allow a lay-off to continue longer than 13 weeks are present. Pursuant to s. 56(1)(c), the employee is considered to be terminated. However, they may not be considered to be severed for the purposes of the severance pay provisions; they may still be on lay-off. In this circumstance, s. 29(2.2) states that s. 29(2.1) does not apply. As a result, s. 29(1) will apply and the employee will be entitled to a substitute day with public holiday pay. If the employment ends before the substitute day, ESA Part X, s. 32 would apply and the employee will just be entitled to public holiday pay.
The application of this section was clarified in respect of certain assignment employees of temporary help agencies by s. 74.10(2) on November 6, 2009 with the coming into force of the Employment Standards Amendment Act (Temporary Help Agencies) 2009, SO 2009, c 9. Pursuant to s. 74.2, Part XVIII.1 of the Act, which includes s. 74.10(2), does not apply to those assignment employees who provide professional services, personal support services or homemaking services as defined in the Home Care and Community Services Act, 1994 if the assignment is made under a contract between the employee or their employer and a community care access corporation within the meaning of the Community Care Access Corporations Act, 2001, SO 2001, c 33. As a result, the application of s. 29(2.2) is not clarified in respect of such employees by s. 74.10(2).
Section 74.10(2) provides that a period of temporary lay-off referred to in s. 29(2.2) is to be determined in accordance with s. 56 as that section is modified by s. 74.11 for the purposes of Part XV. For further discussion see ESA Part XVIII.1, s.74.10.
This section allows an employer and employee to agree in writing that an employee will be paid public holiday pay for a holiday instead of receiving a substitute day the employee would otherwise be entitled to pursuant to s. 29(1).
See ESA Part X, s. 24 for the calculation of public holiday pay.
This section provides that employees are not entitled to the entitlements under s. 29(1), (2.1) or s. 29(3) if they fail, without reasonable cause, to work their entire regularly scheduled day of work before or after the holiday.
This section is intended to discourage employees from unilaterally taking an extra day off around the public holiday by failing to show up on the day they are expected to work before or after the holiday, or by showing up to work later or leaving earlier than expected before or after the holiday.
This exception to the entitlement is identical in substance to s. 26(2). Please refer to ESA Part X, s. 26 for a discussion of this provision.
Note: An employee who is entitled to a substitute holiday pursuant to s. 29(1) does not lose that entitlement if they fail without reasonable cause to work all of their last regularly scheduled day of work before or first regularly scheduled day of work after the substitute holiday. An employee does not have to "requalify" for the substitute holiday once they have already earned it.
This section provides an exception to the entitlement in ESA Part X, s. 29.
Section 29 provides employees (who are not on pregnancy or parental leave, or on lay-off) with the right to a substitute holiday or, if the employer and employee agree in writing, to public holiday pay for a holiday, when the public holiday falls on a day that is not ordinarily a working day for an employee or is on a day that the employee is on vacation. Section 30(1) allows employers and employees in these circumstances to agree that the employee will work on the public holiday. If an agreement is made, the entitlement in s. 30(2) will apply instead of those set out in s. 29.
The agreement to work on the public holiday must be in writing. See ESA Part I, s. 1(3) and (3.1) for information on this written requirement, and other issues regarding agreements, e.g., retroactivity, specificity, and requirements on informed and voluntary consent. The written agreement must be reached prior to the date of the public holiday.
This section sets out the entitlement of an employee who agreed to work on a public holiday that fell on a day that is not ordinarily a working day, pursuant to s. 30(1).
The default entitlement for such an employee is wages paid at the employee’s "regular rate" (see ESA Part I, s. 1) for each hour worked on the public holiday, plus a substitute holiday:
plus
However, if an employer and employee agree in writing, the employer must, instead of the default entitlement, give to the employee public holiday pay plus premium pay for each hour worked on the public holiday. See ESA Part 1, s. 1(3) and (3.1) for a discussion on agreements in writing. See ESA Part X, s. 24 for the calculation of public holiday pay and premium pay.
The entitlements described above are subject to s. 30(4) - see the discussion below.
Subsection 30(2.1) is a new provision added by the Fair Workplaces, Better Jobs Act, 2017, SO 2017, c 22, effective January 1, 2018. Where the employee has agreed to work on a public holiday and the employer is substituting the public holiday in accordance with s. 30(2) (a), this section requires the employer to provide the employee with a written statement:
The written statement must be provided to the employee before the actual public holiday. The legislation does not specify the manner in which the written statement must be provided. Consistent with the Program’s position regarding the provision of the poster under ESA Part II, s. 2(5), an employer may provide the statement as a printed copy or as an attachment in an email to the employee.
There is no requirement for the parties to sign the written statement, nor is there a requirement for the employee to agree to the date of the substitute holiday, so long as it is a day that would ordinarily be a working day for the employee and that it is scheduled for a day before the deadlines set out in s. 30(3).
This section establishes a deadline for scheduling a substitute holiday an employee earns pursuant to s. 30(2)(a).
The section states that the employer must schedule the substitute holiday (which, pursuant to s. 30(2), must be set for a day that is ordinarily a working day for the employee) for a day that is no later than three months from the date of the public holiday.
The substitute day can be taken before the actual public holiday itself. For example, Canada Day is on a Saturday. An employee usually works weekdays, but agrees in writing to work on Canada Day. It is not a violation of the Act for the employee to be given Friday, June 30, as the substitute holiday.
If the employer and employee agree in writing the substitute holiday can be scheduled for a day that is up to 12 months after the date of the public holiday. See ESA Part 1, s. 1(3) and (3.1) for a discussion on written agreements. An employee may wish to extend the three-month deadline if, for example, they want to tack the substitute holiday on to their next vacation but the vacation is more than three months away.
The written agreement contemplated in s. 30(3)(b) must be reached prior to the public holiday as the employer is required under s. 30(2.1) to give the employee a written statement setting out the date of the substitute day. See ESA Part I, s. 1 for a discussion of issues around agreements, e.g., retroactivity, specificity, and requirements regarding informed and voluntary consent.
This section sets out the entitlements for an employee who agreed to work on the public holiday pursuant to s. 30(1), but who fails to perform certain work.
Every situation that impacts on an employee’s entitlement is covered. That is, this provision sets out the consequences in the event of any of the following circumstances, whether they occur on their own or in combination with one another:
In the discussion below:
The statutory phrases, "performs none of the work that he or she agreed to perform on the public holiday" and "performs some of the work that he or she agreed to perform on the public holiday but fails . . . to perform all of it," does not refer to the quantity or quality of the employee’s work. Rather, it refers to whether the employee worked the whole shift, part of the shift, or none of the shift they agreed to work on the public holiday.
For example, an employee who agreed to work an eight-hour shift on Canada Day and who usually assembles 100 widgets during an eight-hour shift will not be considered to have performed only some of the work merely because they assembled only 80 widgets on Canada Day. So long as the employee worked the entire eight-hour shift, they will have "performed all of the work" they agreed to perform on the holiday.
The situations and consequences addressed in each of the five paragraphs in s. 30(4) are:
Employee performs none of the work on the public holiday, (i.e., did not show up at all on the holiday), without reasonable cause: employee has no entitlement.
Pursuant to s. 30(4) paragraph 1, the employee has no entitlement of any sort: not to a substitute holiday, to public holiday pay or to premium pay. When the employee entered into the s. 30(1) agreement, the entitlement under s. 29 ceased to apply to that employee.
Employee performs none of the work on the public holiday, (i.e., did not show up at all on the holiday), with reasonable cause, employee entitled to:
or
Pursuant to s. 30(4) paragraph 2, the employee is entitled to either a substitute holiday or public holiday pay if the employee had earlier agreed to be paid public holiday pay and premium pay for each hour they were going to work on the public holiday instead of receiving a substitute holiday.
Employee performs none of the work on the public holiday, (i.e., did not show up at all), with reasonable cause AND fails to work all of the last regularly scheduled day of work before or first regularly scheduled day of work after the public holiday, without reasonable cause:
Pursuant to s. 30(4) paragraph 2, the employee has no entitlement of any sort: not to a substitute holiday, to public holiday pay or to premium pay. When the employee entered into the s. 30(1) agreement, the general entitlement under ESA Part X, s. 29 ceased to apply to that employee.
Employee performs some but not all of the work they agreed to perform on the public holiday, (i.e., showed up for only part of the shift) without reasonable cause:
Pursuant to s. 30(4), paragraph 3, the employee is entitled only to premium pay for each hour worked on the public holiday. They have no other entitlements - not to public holiday pay or to a substitute holiday.
Employee performs some but not all of the work they agreed to perform on the public holiday, (i.e., showed up for only part of the shift) with reasonable cause:
Employee entitled to:
or
Pursuant to s. 30(4) paragraph 4, the employee is entitled to either wages at their regular rate plus a substitute holiday, or public holiday pay plus premium pay if they agreed to be paid public holiday pay plus premium pay instead of receiving a substitute holiday.
Employee performs some but not all of the work they agreed to perform on the public holiday, (i.e., showed up for only part of the shift), with reasonable cause AND fails to work all of their last regularly scheduled day of work before or first regularly scheduled day of work after the public holiday, without reasonable cause:
Pursuant to s. 30(4) paragraph 4, the employee is only entitled to premium pay for each hour worked on the public holiday.
Employee performs all of the work they agreed to perform on the public holiday (i.e., showed up for the entire shift), but fails to work all of their last regularly scheduled day of work before or first regularly scheduled day of work after the public holiday, without reasonable cause:
Pursuant to s. 30(4) paragraph 5, the employee is only entitled to premium pay for each hour worked on the public holiday.
Note: An employee who is entitled to a substitute holiday pursuant to s. 30(2)(a) does not lose that entitlement if they fail without reasonable cause to work all of their last regularly scheduled day of work before or first regularly scheduled day of work after the substitute holiday. An employee does not have to "requalify" for the substitute holiday once they have already earned it.
This section means that any hours worked on a public holiday that are compensated with premium pay are to be excluded when determining whether an employee’s hours of work exceed the applicable overtime threshold.
Note that only those hours that are worked on a public holiday AND that are compensated with premium pay are excluded when determining whether or not the employee has crossed the overtime threshold. For example, if an employee works on Canada Day for regular pay and is given a substitute day off with public holiday pay, the hours worked on Canada Day are counted.
Note also that those hours that are worked on a public holiday and compensated with premium pay are excluded only for the purposes of determining overtime entitlements. They are not excluded for any other purposes, such as the hours of works limits or the weekly/biweekly rest periods.
The following examples illustrate the application of s. 31:
Employee works on a public holiday (Monday) and is paid public holiday pay plus premium pay for every hour worked on the holiday.
Employee’s schedule:
Actual hours worked = 53 hours
Number of hours to be included in overtime threshold calculation = 53 actual hours worked minus 8 hours worked on the public holiday for which the employee was paid premium pay = 45 hours
Number of overtime hours = 45 hours minus 44 hours = 1 hour
Assume that the employee’s rate of pay is $15.00 per hour.
For the 53 hours worked in that work week, the employee is entitled to:
Total wages owing = $994.50
Employee works on a public holiday (Monday) and is paid his or her regular rate for hours worked on the public holiday plus receives a substitute day off with public holiday pay, scheduled to be taken in two months.
Employee’s schedule:
Actual hours worked = 53 hours
Number of hours to be included in overtime threshold calculation = 53 hours (the 8 hours worked on the public holiday are included in the total because they were not compensated with premium pay)
Number of overtime hours = 53 hours minus 44 hours = 9 hours
Assume that the employee’s rate of pay is $15.00 per hour.
For the 53 hours worked in that work week, the employee is entitled to:
Total wages owing = $862.50
This section provides that an employee whose employment is terminated before they received their substitute day off with public holiday pay is owed the public holiday pay. The employer must pay the public holiday pay no later than the later of seven days after the termination or the day that would ordinarily have been the employee’s next pay day.
Section 32 will apply regardless of the reason for the employment coming to an end, whether it be because the employee resigned, or was terminated, whatever the reason behind the termination. For example, s. 32 will apply even if an employee is terminated because they were guilty of wilful misconduct that has not been condoned by the employer and is therefore not entitled to termination pay or notice.
Section 24(1) sets out the calculation that is used to determine the amount of public holiday pay owing. Because public holiday pay for a substitute holiday is calculated on the basis that the substitute day is a public holiday in accordance with s. 27(2)(a), s. 28(2)(a), s. 29(1) and s. 30(2)(a), the formula in s. 24(1) applies when calculating public holiday pay for substitute days.
As a result, the four work week time frame over which the calculation for a substitute holiday is performed is normally the four work weeks prior to the work week in which the substitute holiday falls.
However, where the employee’s employment has been terminated prior to the substitute day being taken, s. 32 provides that the amount of public holiday pay owing is to be determined using the actual public holiday as the reference point.
That is, in accordance with ESA Part X, s. 24(1), the four work weeks prior to the actual holiday is the relevant time frame for the calculation.
The general intent of Part XI Vacation with Pay is to provide employees with vacation time and vacation pay. An employee whose period of employment is less than five years is entitled to two weeks of vacation time after the completion of each 12-month vacation entitlement year. An employee whose period of employment is five years or more is entitled to three weeks of vacation time after the completion of each 12-month vacation entitlement year.
Where the employer has established an alternative vacation entitlement year (i.e., one that does not start on the date of hire or the anniversary of the date of hire), the employee is entitled to a pro-rated amount of vacation time for the period ("stub period") preceding the first alternative vacation entitlement year and two or three weeks of vacation time after each alternative vacation entitlement year thereafter depending upon their period of employment upon competition of each vacation entitlement year.
Vacation pay accrues so as to provide a sum upon which the employee can draw during their vacation. The amount of vacation the employee accrues will depend upon the employee’s period of employment when the vacation entitlement period ends. Employees whose period of employment is less than five years upon completion of a vacation entitlement period, are entitled to accrue vacation pay at four per cent of the gross wages (excluding vacation pay) earned in that vacation entitlement period. Employees whose period of employment upon completion of a vacation entitlement period is five years or more are entitled to accrue vacation pay at six per cent of the gross wages (excluding vacation pay) earned in that vacation entitlement period.
The Government Efficiency Act, 2002, SO 2002, c 18 ("GEA 2002") amended this provision, effective November 26, 2002, to reflect the employer’s ability to establish an alternative vacation entitlement year. ESA Part I, s. 1 defines an alternative vacation entitlement year as a recurring 12-month period chosen by the employer and beginning on a date other than the first day of the employee’s employment. A standard vacation entitlement year is defined as a recurring 12-month period beginning on the date of hire.
The Fair Workplaces, Better Jobs Act, 2017, SO 2017, c 22 (“FWBJA”), effective January 1, 2018, amended the requirement to provide employees with two weeks’ of vacation time after each completed vacation entitlement year with a requirement to provide employees whose period of employment is less than five years upon the completion of a vacation entitlement year with two weeks of vacation time and to provide employees whose period of employment is five years or more upon the completion of a vacation entitlement year with three weeks of vacation time in respect of that vacation entitlement year.
It is the responsibility of the employer to ensure that each employee receives their minimum statutory requirement. Note that where the employer has established an alternative vacation entitlement year, ESA Part XI, s. 34 establishes the employee’s entitlement to a pro-rated amount of vacation time for the period of employment (the "stub period") that precedes the first alternative vacation entitlement year.
The right to vacation time accrues only after the completion of each 12-month vacation entitlement year. Nevertheless, vacation time may be taken prior to the expiry of the 12-month vacation entitlement year if the employer is agreeable to this or if the contract of employment clearly provides for that entitlement. The only restriction on when the vacation must be taken is set out in ESA Part XI, ss. 35 and 35.1, which provide that it must be completed no more than 10 months following the end of the period over which it was earned.
The entitlement to either two or three weeks of vacation time is determined solely by the employee’s period of employment upon completion of each vacation entitlement year. If the employee’s period of employment is less than five years upon completion of the vacation entitlement year, the employee is entitled to two weeks of vacation time in respect of that vacation entitlement year. Likewise, if the employee’s period of employment is five years or more upon the completion of the vacation entitlement year, the employee’s entitlement is to three weeks of vacation time in respect of that vacation entitlement year. For example, an employee who reaches the five year period of employment threshold a full 10 months prior to the completion of the vacation entitlement year and an employee who reaches that threshold just one day prior to the completion of the vacation entitlement year will both be entitled to three weeks of vacation in respect of that vacation entitlement year.
The period of employment is a reference to the period that the employee has been employed by the employer since the date of hire. Under the ESA 2000, the period of employment also determines entitlements to things such a pregnancy and parental leave, organ donor leave, reservist leave and termination pay. The period of employment is not affected by inactive periods of employment such as leaves or lay-off. However, if there is a break in the employment relationship, the period of employment will be determined by the most recent period beginning after that break. Note that O Reg 288/01, s. 8(2), which ties together any two periods of employment separated by less than 13 weeks for the purposes of notice entitlements under the ESA 2000, does not apply to ESA Part XI.
In accordance with ESA Part III, s. 5(2), where the vacation time entitlement is a period of more than the statutory entitlement of two or three weeks, as per an agreement between the employer and the employee, this greater right will prevail. However, it should be noted that because vacation time and vacation pay are separate entitlements under ESA Part XI, s. 35.2, the fact that an employer provides a greater right or benefit with respect to vacation time does not necessarily mean that the employer is also providing a correspondingly greater right or benefit with respect to vacation pay and vice versa.
Employee hired on June 1, 2014 and has a standard vacation entitlement year that runs from June 1 of each year to May 31 of the following year:
Employee earns two weeks of vacation time upon completion of each of the following four vacation entitlement years:
On May 31, 2019, the employee completed five years of employment and so will be entitled to three weeks of vacation for the vacation entitlement year June 1, 2018 to May 31, 2019. In each subsequent vacation entitlement year, the employee’s vacation time entitlement will be three weeks.
Section 33(2) provides that inactive as well as active periods of employment be included in the 12-month vacation entitlement period for the purpose of determining an employee’s entitlement to vacation time. The corresponding provision with respect to the accrual of vacation time over a stub period is ESA Part XI, s. 34(4).
An employee’s entitlement to vacation time accrues so long as the employment relationship continues. Therefore, the employee need not be actively employed (i.e., actually performing work) to earn the right to vacation time. Provided that the employee completes the vacation entitlement year (i.e., there is no break in the employment relationship during the vacation entitlement year), time spent on a Part XIV leave, or an approved leave of absence, temporary lay-off, etc. (all periods of inactive employment) must be credited to an employee in respect of their entitlement to vacation time. However, vacation pay will only be calculated on the actual wages earned during the period in respect of which the vacation is earned as per ESA Part XI, s. 35.2.
Subsection 33(3) sets out a calculation for vacation entitlements for employees who will be taking vacation in blocks of less than one week.
An employee must request permission, in writing, from their employer to take vacation time in days rather than weeks. If the employer agrees to this request, in writing, the employee may take vacation time in shorter periods, i.e., days rather than weeks - see ESA Part XI, s. 35.
For those employees who have a regular work week, the number of single vacation days is based on the number of days in the employee’s regular work week. For example, if an employee regularly worked four days per week, the employee would be entitled to four single vacation days for each of the two or three weeks' vacation earned, as applicable, in the vacation entitlement year in accordance with s. 33(1).
If the employee does not have a regular work week, the entitlement to single vacation days is calculated under s. 33(3)(b) as the average number of days worked per week during the most recently completed vacation entitlement year. For example, if an employee works an average of three days per week, the employee would be entitled to three single vacation days for each of the two or three weeks’ vacation earned, as applicable, in the vacation entitlement year in accordance with s. 33(1).
Calculation of single vacation days under s. 33(3)(b):
If an employee had worked 160 days in the 12-month period, the number of single vacation days would be calculated as 160 days divided by 52.18 = 3.07 days for each week of vacation (either two or three weeks) the employee is entitled to under s. 33(1).
If an employee does not have a regular work day as defined in ESA Part I, s. 1(1) in that the employee does not usually work the same number of hours each day, it is Program policy that a day will be based on an average number of hours worked on the days worked in the 12-month vacation entitlement year preceding the first vacation day. This calculation requires totaling the number of hours worked in the 12-month period and dividing that by the number of days actually worked.
On the facts described in example 1, if the employee had worked a total of 500 hours in the 160 days worked in the 12-month vacation entitlement year, an average day would be: 500 hours divided by 160 days worked = 3.13 hours
As a result, the employee would be entitled to 3.07 vacation days of 3.13 hours each for each week of vacation time (either two or three weeks) that the employee was entitled to in accordance with s. 33(1).
The number of single vacation days/hours to which an employee is entitled under this section may not correspond directly to the amount of vacation pay that the employee is entitled to under the ESA 2000. An employee is entitled to a minimum of four or six per cent of the total wages earned in each vacation year as vacation pay (depending upon the employee’s period of employment upon the completion of the vacation entitlement year) or the amount to which the employee is entitled as a greater right or benefit under a contract of employment.
The FWBJA added this provision to the ESA 2000. It provides that although s. 33(1)(b) provides that employees whose period of employment is five years or more upon completion of a vacation entitlement year are entitled to three weeks of vacation in respect of that vacation entitlement year, employers are not required to provide any increased vacation entitlement in respect of a vacation entitlement year that ends before December 31, 2017.
Under s. 33(4), if the vacation entitlement year ended before December 31, 2017, an employee is entitled to two weeks of vacation time in respect of that vacation entitlement year, regardless of the employee’s period of employment upon the completion of that vacation entitlement year. If the vacation entitlement year ended either on or after December 31, 2017, an employee whose period of employment was five years or more when that vacation entitlement year ended is entitled to three weeks of vacation time in respect of that vacation entitlement year.
There is a similar transition provision that applies with respect to stub periods ending before December 31, 2017 in ESA Part XI, s. 34(5).
The Government Efficiency Act, 2002, SO 2002, c 18 ("GEA 2002") added this provision to the Employment Standards Act, 2000. It states that s. 34, which provides for the accrual of vacation time over a stub period, applies where the employer has established an alternative vacation entitlement year. Subsequently, the Fair Workplaces, Better Jobs Act, 2017, SO 2017, c 22 (“FWBJA”) repealed and replaced this provision to reflect the increased vacation entitlement (a pro-rated three-week entitlement) brought in by that FWBJA for employees whose period of employment is five or more years upon completion of a stub period.
ESA Part I, s. 1 defines an alternative vacation entitlement year as a recurring 12-month period that begins on a date chosen by the employer, other than the first day of the employee’s employment.
ESA Part I, s. 1 defines a stub period as follows:
Section 34(2) sets out the method for calculating the vacation entitlement earned in a stub period where the employee’s period of employment is less than five years upon completion of that stub period.
The stub period entitlement is essentially a pro-rated amount of the two week entitlement that an employee whose period of employment was less than five years would earn upon completion of a 12-month vacation entitlement year.
Employees who have a regular work week will earn vacation time of two weeks multiplied by the ratio of the stub period to 12 months.
If the stub period was three months' long the calculation would be as follows:
Employees who do not have a regular work week will earn vacation time of two times the average number of days worked per work week in the stub period multiplied by the ratio of the stub period to 12 months.
If the stub period was three months' long and the employee worked an average of 2.6 days per week in the stub period the calculation would be as follows:
Section 34(3) sets out the method for calculating the vacation entitlement earned in a stub period where the employee’s period of employment is five years or more upon completion of that stub period.
The stub period entitlement is essentially a pro-rated amount of the three week entitlement that an employee whose period of employment was five years or more would earn upon completion of a 12-month vacation entitlement year.
Employees who have a regular work week will earn vacation time of three weeks multiplied by the ratio of the stub period to 12 months.
If the stub period was three months' long the calculation would be as follows:
Employees who do not have a regular work week will earn vacation time of three times the average number of days worked per work week in the stub period multiplied by the ratio of the stub period to 12 months.
If the stub period was three months' long and the employee worked an average of 2.6 days per week in the stub period the calculation would be as follows:
Section 34(4) provides that inactive as well as active periods of employment are included in the stub period for the purpose of determining an employee’s entitlement to vacation time. Note that ESA Part XI, s. 33(2) is the corresponding provision in regards to the accrual of vacation time over a vacation entitlement year.
An employee’s entitlement to vacation time accrues while the employment relationship continues. Therefore, the employee need not be actively employed (actually performing work) to earn the right to vacation time. Provided that the employee completes the stub period (i.e., there is no break in the employment relationship during the stub period), time spent on any Part XIV leave an approved leave of absence, temporary lay-off, etc. (all periods of inactive employment) must be credited to an employee in respect of their entitlement to vacation time. However, vacation pay will only be calculated on the actual wages earned during the period in respect of which the vacation is earned as per ESA Part XI, s. 35.2.
While the transition provision for vacation entitlement years is found in ESA Part XI, s. 33(4), the transition provision that applies to stub periods is found in s. 34(5).
Subsection 34(3) provides that employees whose period of employment is five years or more upon completion of a stub period are entitled to a pro-rated amount of three weeks of vacation in respect of that stub period. However, this transition provision specifies that employers are not required to provide this increased vacation entitlement in respect of a stub period that ends before December 31, 2017. Therefore, if a stub period ended before December 31, 2017, an employee is entitled to a pro-rated amount of two weeks of vacation time in respect of that stub period, regardless of the employee’s period of employment upon completion of that stub period.
This provision was previously amended by the Government Efficiency Act, 2002, SO 2002, c 18, to reflect the changes to the ESA, 2000, allowing employers to establish alternative vacation years. It was subsequently repealed and replaced by the Fair Workplaces, Better Jobs Act, 2017, SO 2017, c 22 to reflect the increased vacation entitlement (three weeks) brought in by that Act for employees whose period of employment is five or more years upon completion of a vacation entitlement year.
Section 35 gives employers the right and the obligation to determine when an employee may take the vacation earned upon completion of a vacation entitlement year. However, the employer must ensure that the vacation is completed no later than 10 months following the completion of the vacation entitlement year during which the vacation was earned.
Under paragraphs 1 and 2, the employer is required to provide the vacation in periods of at least one week, unless the employee requests in writing and the employer agrees to allow the employee to take vacation in increments of less than one week.
Since the employer has the right to assign the employee’s vacation time and, accordingly, the right to approve or reject a vacation period requested by the employee, it follows that the employee has no right to take a vacation on their own initiative. For example, in Fox, Glicksman & Co. v Reynolds (December 16, 1981), ESC 1118 (Black), a decision under the former Employment Standards Act, an employee took a two-week vacation but had obtained employer approval for only one week. Additionally, the employee was warned not to take the two-week vacation. The referee held that in taking the two weeks of vacation without the employer’s permission, the employee’s actions amounted to wilful misconduct and therefore the employee was not entitled to pay in lieu of notice of termination. It must be noted, however, that where an employee expresses an intention to take vacation, in order for the employee’s actions to amount to wilful misconduct the employer must expressly forbid the proposed vacation period - see Peter Tsorovas c.o.b. Mr. Submarine v Zwicker (January 12, 1982), ESC 1131 (Betcherman), also decided under the former Employment Standards Act. For further discussion of the meaning of wilful misconduct, disobedience or neglect of duty, see O Reg 288/01, s. 2.
The vacation must be completed no later than 10 months after the end of the employee’s 12-month vacation entitlement year. The employer will therefore not be in violation of this requirement until 22 months after the commencement of the 12-month period during which the vacation time was earned.
It should also be noted that an employer is not permitted to schedule an employee’s vacation during the statutory notice period, unless the employee, after having received the notice, agrees to take their vacation during the statutory notice period. See O Reg 288/01, s. 7.
Section 35 permits employees to take vacation time earned over a vacation entitlement year in increments of less than one week provided the following criteria are met:
It should be noted that where an employee is provided with vacation time in excess of the employee’s two- or three- week entitlement under the Act, an employer is free to schedule those excess weeks as it sees fit (e.g., as single days).
Section 35.1 was added by the Government Efficiency Act, 2002, SO 2002, c 18, to reflect the changes to the Employment Standards Act, 2000 allowing employers to establish alternative vacation years.
Section 35.1 gives employers the right and the obligation to determine when an employee may take the vacation time earned over the stub period. However, under s. 35.1(2) the vacation days must be taken in minimum blocks (unless agreed otherwise) and the vacation must be taken no later than 10 months following the stub period during which the vacation was earned.
Section 35.1(2) requires the employer to ensure the employee takes the vacation earned in a stub period within 10 months of the completion of the stub period.
Except where the parties have agreed otherwise, it also provides that if the employee has earned less than five vacation days, those days are to be taken consecutively. If the employee has earned more than five days, the first five days must be taken consecutively, and the balance may be taken together with the first five days or as a separate period of consecutive days.
An employee may request in writing and where the employer agrees, the vacation may be taken in shorter periods than otherwise required under this section.
Section 35.2 provides employees who are entitled to vacation under ESA Part XI, s. 33 or s. 34 with an entitlement to vacation pay. This provision was amended to reflect the changes to the ESA 2000 that allow vacation to accrue over alternative vacation entitlement years in addition to standard vacation entitlement years, as well as the accrual of vacation over a stub period where an alternative vacation entitlement year is established. It was subsequently repealed and replaced by the Fair Workplaces, Better Jobs Act, 2017, SO 2017, c 22 to increase the minimum vacation pay entitlement of four per cent of the wages earned in any vacation entitlement period (i.e., a stub period or vacation entitlement year) to six per cent for employees whose period of employment is five years or more. This change is consistent with the changes made to s. 33 and s. 34 which increased the vacation time entitlement to three weeks and a pro-rated amount of three weeks for such employees upon the completion of a vacation entitlement year or stub period respectively.
The effect of s. 35.2 is to require employers to pay vacation pay of at least four per cent (for employees whose period of employment is less than five years upon completion of a vacation entitlement period) and six per cent (for employees whose period of employment is five years or more upon completion of a vacation entitlement period) of all of the wages earned during the vacation entitlement period (whether a standard vacation entitlement year, alternative vacation entitlement year or stub period) for which the vacation is given, as payment for the vacation. Any vacation pay previously paid is to be excluded from the calculation of wages under this section. ESA Part XI, ss. 36, 37 and 38 stipulate when vacation pay is to be paid.
Note that the vacation pay entitlement is either four per cent or six per cent of the wages earned in a vacation entitlement period. In other words, an employee whose period of employment is less than five years upon completion of a vacation entitlement period is entitled to vacation pay calculated as four percent of the wages earned in the vacation entitlement period. An employee whose period of employment is five years or more upon completion of a vacation entitlement period is entitled to vacation pay calculated as six percent of the wages earned during the entitlement period regardless of whether the employee’s period of employment was five years or more when the vacation entitlement period commenced or the employee reached the five year period of employment part way through the vacation entitlement period.
The question arises however as to how employees who are paid vacation pay on a pay period by pay period basis will be paid vacation pay in a vacation entitlement period in which the employee reaches the five year period of employment threshold.
Although s. 35.2 ties the right to vacation pay to the completion of vacation entitlement periods, employees accrue vacation pay on an ongoing basis as a result of the application of the Apportionment Act, RSO 1990, c A.23. See also the discussion regarding payment of vacation pay on cessation of employment in ESA Part XI, s. 38.
As a consequence, an employee who is paid their accrued vacation pay on each pay day will be paid four per cent of the wages earned in each pay period as vacation pay until the employee reaches the five year period of employment threshold. At that time, the employee’s entitlement increases to six per cent vacation pay on all wages earned in the vacation entitlement period and so an additional two percent of vacation pay will be due and payable on the wages earned to the date the five year threshold is reached. From that date forward, the employee would be paid six percent of the wages earned in each pay period as vacation pay.
The employee is entitled to be paid four per cent on the wages earned between January 1 and June 30 as vacation pay because the employee’s period of employment is less than five years.
However, on July 1 the employee reaches the five year period of employment threshold and as a consequence the vacation pay entitlement for that vacation year increases from four per cent to six per cent of all the wages earned in the vacation entitlement year.
The employer will therefore be required to "top-up" the four per cent vacation pay earned up to and including June 30 with an additional two per cent. This payment will be due on the pay day for the pay period in which July 1 falls.
The employee will then be paid six per cent vacation pay on the wages earned from July 1 to December 31.
An employee has the right to be provided with vacation pay of at least four per cent or six per cent as the case may be of the total wages (excluding any vacation pay) earned during the period of employment for which the vacation is given.
As an employment standard, vacation pay is mandatory and cannot be waived pursuant to ESA Part III, s. 5(1). Accordingly, an employer cannot reduce or eliminate vacation pay to compensate for the incompetence of the employee – see MacNamarra v Hanrath (February 23, 1980), ESC 717 (Adamson). Nor is an employer excused from the obligation under s. 38 where the employee has committed a criminal offence – see Burlington Carpet Mills Canada Ltd. v Smitten (May 16, 1974), ESC 227 (Magerman). Both of the aforementioned decisions were decided under the former Employment Standards Act.
In Tim Wilkins Pontiac Buick Ltd. d.b.a. Lorne Brett Motos Ltd. v Ojamae et al (October 2, 1980), ESC 878 (Davis), a decision under the former Employment Standards Act, Referee Davis ruled that where a monthly-salaried employee receives a full month’s salary for a month in which the employee took a one-week vacation, the amount of vacation pay to be considered to have been paid is not one-quarter of the monthly salary but rather an amount equal to the monthly salary divided by 4.33. This is because a month is a slightly longer period than four weeks.
In Laurentian University of Sudbury v Kretzchmar (September 30, 1983), ESC 1492 (Betcherman), the employer and employee agreed that if the employee did not take any vacation, no payment in lieu of vacation would be paid. In confirming the order for pay in lieu of vacation pay under the former Employment Standards Act, the referee held that any agreement between an employee and employer that represents a waiver of the rights to vacation pay under s. 28 of the former Employment Standards Act (corresponding to s. 35.2 of the ESA 2000) was void pursuant to s. 3 of the former Employment Standards Act (corresponding to ESA Part III, s. 5 of the ESA 2000). In this regard, see also John Bear Pontiac Buick Limited v Wade (December 17, 1985), ESC 2001 (Egan). Furthermore, although ESA Part XI, s. 41(1) of the ESA 2000 now expressly allows an employee to agree to forego their vacation time (with the Director’s approval), ESA Part XI, s. 41(2) precludes any agreement to forego vacation pay.
Vacation pay accumulates as wages are earned. Vacation pay is the equivalent of four or six per cent of wages for the period of employment for which the vacation is given, except that in calculating wages, any vacation pay previously paid must be excluded.
Vacation pay is payable on wages as defined in ESA Part I, s. 1(1):
"wages" means,
but does not include,
For a more detailed discussion refer to ESA Part I, s. 1. Note that wages includes payments made under the ESA 2000 relating to Part XIV domestic violence leave pay.
The decisions cited below (all decided under the former Employment Standards Act) hold that the following items are included in wages for the purposes of calculating vacation pay:
Early referee decisions were not settled on whether termination pay should be considered wages for the purpose of calculating vacation pay. Program policy however, is that termination pay is taken into account when calculating the wages upon which vacation pay will be assessed. The Program’s policy that vacation pay is payable on termination pay has been confirmed by the Ontario Divisional Court in Inco Ltd. v. U.S.W.A.
Where notice of termination is provided under ESA Part XV, s. 60, vacation pay is calculated on wages earned during the notice period. If the employer does not provide notice but gives the employee pay in lieu under ESA Part XV, s. 61, the employer is required to pay the employee the amount the employee would have received "had notice been given". Consequently, the pay in lieu would include vacation pay on the wages the employee would have earned during the notice period. If it were otherwise, an employer would realize a monetary advantage in choosing to provide pay in lieu instead of giving the employee notice. However, vacation pay is not payable on severance pay as severance pay is not compensation for lack of notice of termination. Rather, severance pay is an entitlement that crystallizes after the employment relationship has ended and is provided as compensation for loss of seniority and job-related benefits and also for the investment of long service with the employer.
Section 36(1) requires employers to pay vacation pay in a lump sum before the vacation time is taken, subject to ss. 36(2), 36(3) and 36(4).
It should be noted that s. 36(1) does not specify when the vacation pay is to be paid beyond the requirement that it be paid before the vacation is taken. The Act does not require the employer to pay it for example, the day before the vacation commences, the week before the vacation commences or on any other particular date prior to the commencement of the vacation.
In Grand & Toy Limited v Ontario (Director of Employment Standards), 2006 CanLII 39100 (ON LRB), the vacation pay accruing during the vacation entitlement year was paid on a date shortly after the vacation entitlement year ended and sometime before the employee took vacation. On that basis, the Ontario Labour Relations Board found that the payment was in conformity with s. 36(1). Further, because the payment was made in conformity with s. 36(1), there was no need for an agreement in writing to fix a date for the payment as per s. 36(4).
Section 36(2) sets out an exception to the general rule of advance payment of vacation pay set out in s. 36(1) and permits employers to pay vacation pay on or before the employee’s pay day for the period in which the vacation falls.
For example, if an employee takes vacation during week of September 9 to 13, and the pay day for the pay period September 1 to 15 is September 21, then the employee’s vacation pay is due on or before September 21.
Section 36(2) applies in the following two situations only:
ESA Part V, s. 11(4) provides as follows:
Section 36(3) has the effect of permitting an employee and an employer to agree in writing that the employer may pay the vacation pay that accrues during each pay period on the pay day for that period. See ESA Part I, s. 1(3) and s. 1(3.1) for information on agreements in writing. This method of paying vacation pay may only be used if the following criteria are met:
It should be noted that although ESA Part XI, s. 35 and s. 35.1 require vacation time to be taken (completed) within the 10 months following the period in which the vacation is earned, these provisions do not impose a time limit with respect to the payment of vacation pay where the employer and employee have made an agreement under s. 36(3) or s. 36(4). Where the employer and employee have made such an agreement, the obligations with respect to the payment of vacation pay are independent from the requirements to schedule vacation time.
This provision permits the employer and the employee to agree in writing to pay the employee vacation pay at a time they mutually choose. See ESA Part I, s. 1(3) and s. 1(3.1) for information on agreements in writing. Agreements made pursuant to s. 36(4) do not require approval from the Director of Employment Standards.
It should be noted that although ESA Part XI, s. 35 and s. 35.1 require vacation time to be taken (completed) within the 10 months following the period in which the vacation is earned, these provisions do not impose a time limit with respect to the payment of vacation pay where the employer and employee have made an agreement under s. 36(4) or s. 36(3). Where the employer and employee have made such an agreement, the obligations with respect to the payment of vacation pay are independent from the requirements to schedule vacation time.
This provision introduced by the Employment Standards Act, 2000. It codifies Program policy that applied with respect to the application of s. 29(3) of the former Employment Standards Act.
Section 37(1) requires employers to pay employees their vacation pay at the time of their scheduled vacation, despite any strike or lock-out during the scheduled vacation period. Sections 29(2) and 29(3) under the former Employment Standards Act permitted this result but did not require it. Section 29(2) gave the Director the power to require an employer to pay vacation pay to an employee (who was entitled to vacation pay) at any time. Section 29(3) provided that the Director’s power under s. 29(2) applied even in the context of a strike or lock-out.
This provision was introduced by the ESA 2000. The effect of this provision is to require an employer to pay vacation pay to an employee in respect of a pre-approved and scheduled vacation that falls during a strike or lock-out, despite a purported cancellation of that previously scheduled vacation.
This section provides that when an employee’s employment ends, for any reason, the employee is entitled to any accrued vacation pay that is outstanding at the time the employment ended and the employer is required to pay any such vacation pay within the later of seven days of the date the employment ended or on the day that would have been the employee’s next pay day as per ESA Part V, s. 11(5). Note also that ESA Part V, s. 12.1 sets out a requirement to provide a statement of the wages paid (including vacation pay) when employment ends.
An employee whose employment has ended and has not been given a vacation with pay in respect of a completed stub period or 12-month vacation entitlement year is entitled to vacation pay on wages (excluding any vacation pay previously paid) for the stub period or vacation entitlement year.
If the employee has not completed a vacation entitlement period, the employee is not entitled to vacation time and, under ESA Part XI, s. 35.2, the right to accrue vacation pay appears to be explicitly tied to the completion of a vacation entitlement period.
However, by application of another piece of legislation called the Apportionment Act, RSO 1990, c A.23, employees have the right to accrue vacation pay on an ongoing day by day basis and therefore, the right to accrue vacation pay does not depend upon the completion of a vacation entitlement period. Even if an employee is hired and is terminated after working just one hour, the employee has accrued vacation pay on those wages.
The employee whose employment has ended will, therefore, receive at least four per cent or six per cent of the wages earned in any period of employment (whether a completed vacation entitlement year or stub period or not) for which vacation pay has not been given.
Because the entitlement to six per cent vacation pay is determined by whether an employee has reached the five year period of employment threshold, an employee whose employment is terminated during a vacation entitlement period before the employee has reached the five year threshold will be entitled on termination to vacation pay calculated as four per cent of the wages earned during the last (partially completed) vacation entitlement period (plus any outstanding vacation pay earned in previously completed vacation entitlement periods).
An employee who reached the five year period of employment threshold in that last (partially completed) vacation entitlement period is entitled to six per cent of all of the wages earned in that period (plus any outstanding vacation pay earned in previously completed vacation entitlement periods).
Employee’s vacation pay for the period January 1 to March 31 is calculated as four per cent of all wages earned January 1 to March 31 because the employee had not reached the five year period of employment threshold prior to the termination.
The employee’s vacation pay for the period January 1 to November 1 is calculated as six per cent of all wages earned January 1 to November 1 because the employee had reached the five year period of employment threshold prior to the termination.
Pursuant to s. 38, the employee is entitled to payment of that vacation pay on cessation of employment in accordance with ESA Part V, s. 11(5).
The standard rules with respect to permissible and non-permissible deductions from wages apply to s. 38 payments. For a detailed discussion, refer to ESA Part V, s. 13.
Where no records have been kept of vacations taken or payments of vacation pay, and there has been no separate item for vacation pay on wage statements, referees (in decisions made under the former Employment Standards Act) have consistently rejected employers' claims that the rate of pay included vacation pay and that it should therefore be deducted from vacation pay owing under s. 30 of the former Employment Standards Act (which correspond to s. 38 of the ESA 2000) or that vacation had already been taken. See the following decisions decided under the former Employment Standards Act: Natalizio c.o.b. The Lords Men’s Hairstyling and Nataligio Enterprises Inc. c.o.b. L'Image Harstudio v Kraft et al (June 16, 1986), ESC 2132 (Egan); Roundhill Apartments v Turcaj (January 2, 1979), ESC 564 (Franks); Legal Personnel Consultants Ltd. v Strauss (December 8, 1979), ESC 673 (Green); Baker v Newland (July 22, 1980) ESC 821 (Bigelow); and Snow-Sport Limited v Bondy (May 26, 1986), ESC 2119 (Houston).
In Ener-Temp Mechanical v Bristow (February 1, 1985) ESC 1777 (Eaton), vacation pay was incorporated into the hourly rate, but the employee did not understand the method of payment. An order for vacation pay was affirmed.
In addition, no paid time-off will be deducted from a vacation payment under s. 38 unless both the employee and the employer agreed that such time-off constituted vacation with pay.
Finally, an employer is prohibited from deducting or setting off vacation pay from any vacation pay or a vacation with pay previously paid to an employee in excess of the employer’s obligations under ESA Part XI Vacation with Pay. In Re Harold J. O’Brien (a decision under the former Employment Standards Act), where the employee had received three weeks' paid vacation – 1 week in excess of the applicable minimum standard, the employer was not allowed to set off the excess one-week paid vacation from the amount subsequently owed to the employee under s. 30 (now s. 38). However, the payment of vacation in excess of the Part XI Vacation with Pay requirements must be carefully reviewed in order to determine its characterization and the intent of the payment at the time it was made. If it was intended and characterized as an advance on a vacation pay payment, as opposed to an intentional payment of a greater contractual benefit than the Part XI Vacation with Pay standard, then it will be considered as a wage advance as opposed to wages earned. In that case, any adjustment on a subsequent vacation pay payment will be accepted as a proper reconciliation of wages due, i.e., a determination of wages earned, wages paid and those remaining outstanding, as opposed to a deduction or set-off prohibited by ESA Part V, s. 13. The employment standards officer would, in addition to ascertaining the employer’s and employee’s understanding of the payments, review the relevant employer’s payroll records, as well as wage statements to determine if any evidence of intent or characterization of the payments exists.
This provision was introduced by the Employment Standards Act, 2000 and codifies Program policy that applied with respect to s. 31 of the former Employment Standards Act. The provision has the effect of permitting unionized employers to participate in multi-employer vacation plans, where the types of obligations described in ss. 36, 37 and 38 of the ESA 2000 are performed by the administrator of the multi-employer plan as opposed to the employee’s specific employer. These types of arrangements are common in the construction industry.
Where such a plan is in place, ss. 36, 37 and 38 of the Act which deal with:
do not apply.
This provision, together with s. 40(2), is substantially the same as s. 15 of the former Employment Standards Act. Section 40(1) creates a statutory "deemed trust" for vacation pay. In doing this, the provision gives employee vacation pay a status equivalent to property that has been held in trust by an employer for another party. In other words, trust property is not the employer’s property and does not form part of the employer’s estate.
Trust claims receive priority over the claims of most other creditors of the employer, including many secured creditors. However, the courts have ruled that a statutory deemed trust, such as the s. 40 provision, does not meet the requirements of an actual trust under the federal Bankruptcy and Insolvency Act, RSC 1985, c B-3 ("BIA"). Therefore, vacation pay entitlements receive preferred but unsecured status in a distribution by a trustee in bankruptcy, in accordance with the scheme of distribution set out in s. 136 of the BIA.
In British Columbia v Henfrey Samson Belair Ltd., [1989] 2 SCR 24, 1989 CanLII 43 (SCC) the Supreme Court of Canada considered the effect of a deemed trust provision in the British Columbia Social Services Tax Act, RSBC 1996, c 431 [repealed]. The Court ruled that a deemed trust created by statute was not a trust as contemplated by the former Bankruptcy Act ("BIA"). British Columbia v Henfrey Samson Belair Ltd. has been applied consistently. For example, in I.B.L. Industries Ltd. (Re) (Bkcy.), 1991 CanLII 7223 (ON SC), the Ontario Divisional Court held that an attempt to impose a deemed trust on the property of a bankrupt could not succeed. (If, however, an employer creates an actual trust by keeping the vacation pay separate and apart from other monies, the vacation pay would not form part of the property of the bankrupt and therefore will have priority over the interests of most other creditors, including secured creditors, as a trust under the BIA. Vacation pay is seldom placed in an actual trust by employers.)
In Abraham v Coopers & Lybrand Ltd. Trustee in bankruptcy for Canadian Admiral Corp., 1993 CanLII 8538 (ON SC) the Ontario Divisional Court quashed the referee’s decision in Coopers & Lybrand Limited v Abraham et al (January 26, 1993), ES 08/93 (Wacyk) and indicated that vacation pay falls within the BIA definition of wages and therefore constitutes a preferred claim under s. 136(1)(d). Therefore, in a bankruptcy, vacation pay is subordinate to the claims of secured creditors, although it does have priority over other unsecured creditors with regards to what has accrued during the six months prior to the bankruptcy, to a maximum of $2,000 per employee (the maximum of $2,000 as set out in the BIA). If the bankruptcy occurred prior to August 1, 1992, the vacation pay would only have a priority to the extent of what has accrued during the three months prior to the bankruptcy, to a maximum of $500 per employee. The Divisional Court’s decision in Abraham v Coopers & Lybrand Ltd. is consistent with the Divisional Court’s decision in Armstrong et al. v Coopers & Lybrand Ltd. et al., 1986 CanLII 2621 (ON SC).
Section 136(1)(d) of the BIA now reads:
It should be emphasized that in many bankruptcies, this section will not greatly improve the prospects for recovery of wage entitlements, since it does not give wages priority over the secured creditors of the employer.
The "deemed trust" for vacation pay continues to apply in receivership and other formal insolvency proceedings that are not bankruptcies, to ensure the trust status and priority for the vacation pay claims of employees over the claims of other creditors, including secured creditors. In this regard, see the Divisional Court’s decision in in Abraham v. Coopers & Lybrand Ltd.
In that case, the court upheld the decision of the referee, who had determined that vacation pay took priority over a bank’s secured claims in the form of a registered debenture and general security agreement under the Personal Property Security Act, RSO 1990, c P.10 ("PPSA"). The receiver argued that the bank’s security took priority over the trust claim, as a prior "fixed" charge duly registered under the PPSA. The Court disagreed. In dismissing the receiver’s application, the Court noted that according to s. 3(1)(a) of the PPSA (now s. 4(1)(a)), the PPSA does not apply to a lien given by statute.
40(2) An amount equal to vacation pay becomes a lien and charge upon the assets of the employer that in the ordinary course of business would be entered in books of account, even if it is not entered in the books of account.
This provision together with s. 40(1) is substantially the same as s. 15 of the former Employment Standards Act. It has the effect of deeming a lien or charge on the assets of the employer. A lien or charge is a means of enforcing a debt or what may or will become a debt. In this case it is an unsecured debt. This is so, irrespective of whether the charge or lien is ever recorded in the employer’s books of account.
Section 41(1) has the effect of permitting employees and employers to agree in writing that the employee will forego their entitlement to time off for vacation. It should be noted that because the right to forego vacation is limited to vacation to which the employee is entitled, an employee cannot forego future vacation entitlements. See ESA Part I, s. 1(3) and s. 1(3.1) for information on agreements in writing.
Under the Act, an employee’s right to vacation time is earned through completion of a stub period or vacation entitlement year. An employee cannot therefore agree to forego the vacation entitlement in any stub period or vacation entitlement year until the completion of that stub period or vacation entitlement year.
The agreement must be approved by the Director to be valid. However, as per s. 41(2), the employer is not permitted to forego paying the employee their vacation pay even though they have chosen to forego taking vacation time under s. 41(1).
Section 41.1 was introduced by the Government Efficiency Act, 2002, SO 2002, c 18 ("GEA 2002"), effective November 26, 2002. It sets out employees' rights to statements regarding vacation time and pay statements, except where vacation pay is paid on each pay day as it accrues over each pay period as per ESA Part XI, s. 36(3).
Section 41.1(1) requires the employer to provide a statement containing the same information the employer is required to record under the new ESA Part VI, ss.15.1(2) and (3), on the written request of the employee, no more than once with respect to each vacation entitlement year or stub period.
Section 41.1(2) requires that, subject to s. 41.1(3), the vacation statement under s. 41.1(1) must be provided either seven days after the written request was made or the first pay day after the request was made, whichever is later.
Section 41.1(3) provides that where the employee has made a written request for vacation information during the course of a current vacation entitlement year or stub period, the employer is required to provide the information either:
Section 41.1(4) provides that an employer is required to provide a vacation information statement not more than once with respect to any vacation entitlement year or stub period.
Section 41.1(5) provides that the vacation statement obligations in s. 41.1 do not apply where the employer pays vacation pay in accordance with ESA Part XI, s. 36(3) (i.e., the employer and employee have agreed that the vacation pay that accrues in each pay period is to be paid on the pay day for that pay period). Under s. 36(3), the employer must provide information regarding the vacation pay paid each pay day as a separate item on the statement of wages required under ESA Part V, s. 12(1) or on a separate statement at the same time the employee is given the wage statement.
Part XI.1 was added to the ESA 2000 by the Working for Workers Act, 2022 (WFWA 2022), effective April 11, 2022.
Part XI.1 of the ESA requires employers that employ 25 or more employees on January 1st of any year to have a written policy in place before March 1st of that year for all employees with respect to the electronic monitoring of employees. The policy must state whether the employer electronically monitors employees. If the employer does, the policy must contain a description of how, and in what circumstances, the employer may electronically monitor employees and must set out the purposes for which the information obtained through electronic monitoring may be used by the employer. The policy must also include the date it was prepared and the date any changes were made to the policy.
The phrase “electronic monitoring” is not defined in the legislation. It is Program policy that “electronic monitoring” includes all forms of employee and assignment employee monitoring that is done electronically. Section 41.1.1 is not limited to the electronic monitoring of devices or other electronic equipment issued by the employer, nor is it limited to electronic monitoring that happens while employees are at the workplace.
The employer has certain obligations with respect to when the employer has to provide a copy of the written policy to its employees and to assignment employees who are assigned to perform work for it. Obligations are also created with respect to the retention of its electronic monitoring policies (see subsection 15(8.2) for more information on the record-keeping obligations).
A transitional provision sets out different timeframes that apply when the Part first takes effect: employers are to use January 1, 2022 (which is the January 1st immediately preceding the date that is six months after the WFWA 2022 receives Royal Assent) as the point-in-time to establish whether they meet the "25-employee threshold" and, if they do, they must have a written policy in place for all employees with respect to the electronic monitoring of employees by October 11, 2022 (which is six months after the day the WFWA 2022 received Royal Assent). After 2022, the transition provision will no longer have any effect and the time periods apply as set out in subsection 41.1.1(1).
The alleged contraventions of Part XI.1 for which employees and assignment employees can file a complaint are limited. A complaint can only be made to the ministry, or be investigated by an Employment Standards Officer, with respect to an alleged contravention of the employer’s obligation to provide a copy of the written policy within the required timeframe to its employees and to assignment employees who are assigned to perform work for it. A complaint alleging any other contravention of section 41.1.1 cannot be made or be investigated by an employment standards officer.
Part XI.1 also contains a provision setting out, for greater certainty, that nothing in section 41.1.1 affects or limits an employer’s ability to use information it obtained through the electronic monitoring of its employees in any way it sees fit.
Part XI.1 applies to all employees and employers covered by the ESA, except the Crown, a Crown agency or an authority, board, commission or corporation all of whose members are appointed by the Crown and any employees of such an employer. See section 2.1 of O. Reg. 285/01 for information.
41.1.1(2) The written policy with respect to electronic monitoring must contain the following information:
Subsections 41.1.1(1) and (2) were added to the ESA 2000 by the Working for Workers Act, 2022, effective April 11, 2022.
Section 41.1.1 creates certain obligations on employers to put in place and distribute to their employees, and to assignment employees who are assigned to perform work for them, a written policy on the electronic monitoring of employees.
Subsection 41.1.1(1) provides that an employer that employs 25 or more employees on January 1st of any year must, before March 1 of that same year, ensure that a written policy is in place for all employees with respect to electronic monitoring of employees. Subsection (2) sets out the information that must be contained in the written policy. More specifically, the policy must state whether the employer electronically monitors employees. If the employer does, the policy must contain a description of how, and in what circumstances, the employer may electronically monitor employees and must set out the purposes for which the information obtained through electronic monitoring may be used by the employer. The policy must also include the date it was prepared and the date any changes were made to the policy.
Section 41.1.1 does not establish a right for employees not to be electronically monitored by their employer, nor does it create any new privacy rights for employees. Its scope is limited to requiring that certain employers be transparent as to whether they electronically monitor employees, and where they do, to be transparent in their approach by describing how and in what circumstances that monitoring occurs, and the purposes for which the information obtained through the electronic monitoring may be used.
In order to better understand subsections (1) and (2), the key elements have been broken down and discussed individually below.
In order for an employer to be required to have a written policy in place for all employees with respect to electronic monitoring of employees under the ESA, the employer must employ 25 or more employees on January 1st of any year. This is a point-in-time assessment. In other words, in order to determine whether this criterion is met, the employer must take a “snapshot” of the number of employees it employs on January 1st.
On January 1st, if the employer employs fewer than 25 employees, then the ESA does not impose a requirement that the employer have a written policy in place with respect to electronic monitoring of employees. This is the case even if the employer’s employee count increases at a later point in the same calendar year. For example, if an employer employs 20 employees on January 1st (and hence the requirement does not apply) and later hires five more employees in June of that same year, the employer continues to not be subject to the requirements to have a written policy in place for all employees with respect to electronic monitoring of employees. However, if all 25 employees remain employed by that employer, the employer will have obligations under this Part in the following year when the “snapshot” assessment is again undertaken on the following January 1st. In this example, the employer will have 25 employees on that January 1st date and will therefore be required to have a written policy in place for all employees with respect to electronic monitoring of employees before March 1st of that year.
Conversely, if an employer employs 25 employees or more on January 1st (and hence the requirement applies) and that employer’s employee count decreases at a later point in the same calendar year, the employer is still obligated to have a written policy in place with respect to electronic monitoring of employees. This is the case until the “snapshot” assessment of the “25-employee threshold” is again undertaken on the following January 1st. If the employer employs fewer than 25 employees on that January 1, the ESA requirement to have a written policy in place no longer applies to that employer.
There are a number of issues that may arise in determining whether the “25-employee” threshold is met:
If two or more employers are treated as one employer by virtue of s. 4 of the Act, then all employees employed by these two or more employers are included when determining whether the "25-employee" threshold has been met. This is because of the definition of "employer" in s. 1 of the Act, which reads:
"employer" includes,
(b) any persons treated as one employer under section 4, and includes a person who was an employer.
Where a single employer has multiple locations, all employees employed at each of the locations in Ontario are to be included when determining whether the "25-employee" threshold has been met. For example, an employer owns three sandwich shops with 12 employees employed in each shop on January 1st. This employer employs 36 employees. The employer must have a written policy in place for all employees with respect to the electronic monitoring of employees, even though there are fewer than 25 employees employed at each individual shop.
All workers who meet the definition of "employee" are included when determining whether the 25-employee threshold has been met. See the discussion of the definition of "employee" in ESA Part I, s. 1 of the Manual. Included in the definition of "employee" are:
Employees of temporary help agencies are employees of the agency, so are included in the count only for the purpose of determining whether the agency has met the 25-employee threshold, not for the purpose of determining whether the client the employee is placed with has met the 25-employee threshold. Note that the agency’s count must include all of its assignment employees, whether active or inactive on January 1st.
When this “count” is being done, it is the number of employees that are counted, and not the number of "full-time equivalents". This means that part-time employees each count as one employee, regardless of the number of hours they may work. For example, an employer that employs 26 part-time employees who each work halftime has 13 full-time equivalents, but employs 26 employees for the purpose of this provision.
The question is not whether there are at least 25 employees scheduled to work or working on January 1. The question is whether the employer has an employment relationship with at least 25 employees on January 1.
The employer’s policy with respect to electronic monitoring of employees must be in writing, which includes being electronic. Note that subsections 41.1.1 (3), (4), and (5) impose requirements on the employer with respect to providing a copy of the written policy to its employees and to any assignment employees who are assigned to perform work for it.
The policy must be in place before March 1st. In other words, the latest day the policy can take effect in order for the employer to be in compliance with the provision is the last day of February. (Note this is not the case during the time when the transition provisions in subsection (8) apply.)
While compliance with this provision requires the employer to have a written policy with respect to electronic monitoring of employees in place by March 1st - and to provide a copy of the written policy to its employees and assignment employees who perform work for it within the set timeframes – note that per ss. 41.1.1 (6), neither an employee nor assignment employee can file a claim with the Employment Standards Program, or have a complaint investigated, about the content of the policy itself. As an example, an employee or assignment employee cannot file a complaint alleging that the employer’s policy/the client employer’s policy does not accurately reflect its electronic monitoring practices or that what is described in the policy has not been followed. Employees and assignment employees may only file a complaint with respect to the obligations set out in subsections (3) – (5) with regards to providing a copy of the policy to the employee/assignment employee.
All employees must be covered by the employer’s written policy. In other words, the employer would not be in compliance with this provision if its policy applied to only a portion of its employees – for example, if the policy applied only to the employer’s sales staff but not its managerial staff. However, this doesn’t mean that the employer is required to have the same policy for all its employees. It is Program policy that the employer’s policy can be comprised of different policies (either in a single document or in multiple documents) for different individuals or different groups/classes of employees or it could be a single policy that applies to its employees across-the-board.
It is program policy that an employer’s written policy on electronic monitoring must also apply to all assignment employees who are assigned to perform work for that employer. (Note, this obligation arises only where the employer is a client of a temporary help agency and meets the 25-employee threshold based on the count of its own employees.) This approach is consistent with the language in subsection (1) - “all employees” - and the requirement in subsection (5) obliging the employer to provide assignment employees who perform work for the employer with a copy of the employer’s policy. Assignment employees need not be addressed separately in the policy, but it must apply to them. For example, if an assignment employee is assigned to perform work for employer in a role that is not otherwise addressed in the employer’s written policy, the employer would need to amend the policy to address the work being done by the assignment employee in order to be in compliance with subsection 41.1.1(1).
Ultimately, this means that an assignment employee who works for a temporary help agency that employs 25 or more employees must be covered by the employer’s written policy on electronic monitoring and, where the assignment employee performs work for a client of the agency – where the client employs 25 or more employees itself - the assignment employee must also be covered by the client employer’s written policy on electronic monitoring for the duration of the work assignment.
An employer’s written policy with respect to electronic monitoring of employees may be a stand-alone document, or it may be part of another document (e.g. a comprehensive workplace HR policies and procedures manual).
Subsection (2) sets out the information that must be contained in the employer’s written policy on electronic monitoring of employees.
Where the employer does not electronically monitor employees, the policy must say so. In this situation, the employer has no further information obligations under this heading.
Where the employer does electronically monitor employees, the policy must specifically state this and must also contain the following information:
As an example, if an employer tracks an employee’s delivery vehicle via GPS, the policy could include the following:
The requirement that the employer state the purposes for which information obtained through electronic monitoring may be used by the employer must be read in conjunction with subsection (7), which provides, for greater certainty, that nothing in section 41.1.1 affects or limits an employer’s ability to use information obtained through the electronic monitoring of its employees.
The employer’s written policy must include the date it was prepared and if any changes are made to the policy after that time, the date(s) of any of those changes.
41.1.1(3) An employer that is required under this section to have a written policy with respect to electronic monitoring shall provide a copy of the policy to each of the employer’s employees within 30 days from the day the employer is required to have the policy in place or, if an existing policy is changed, within 30 days of the changes being made.
(4) An employer that is required under this section to have a written policy with respect to electronic monitoring shall provide a copy of the policy to a new employee within 30 days of the day the employee becomes an employee of the employer or within 30 days from the day the employer is required to have the policy in place, whichever is later.
(5) An employer that is a client of a temporary help agency, and that is required under this section to have a written policy with respect to electronic monitoring shall provide an assignment employee assigned to perform work for the employer with a copy of the policy within 24 hours of the start of the assignment or within 30 days from the day the employer is required to have the policy in place, whichever is later.
Subsections 41.1.1(3) – (5) were introduced into the ESA by the Working for Workers Act, 2022 on April 11, 2022. These provisions establish rules about when the written policy must be provided to employees and assignment employees assigned to perform work for an employer.
Pursuant to ss. 41.1.1(3), the employer must provide a copy of the written policy with respect to electronic monitoring of employees to each of its employees within 30 days from the day the employer is required to have the policy in place, or if an existing policy was changed, within 30 days of the changes being made. For information on when the employer is required to have a written policy in place, see subsection (1) and the transitional provision in subsection (8).
Subsection 41.1.1(4) requires the employer to provide a copy of the written policy with respect to electronic monitoring of employees to a new employee within 30 days of that individual becoming an employee of the employer or within 30 days of the day the employer is required to have the policy in place, whichever is later.
As an example, an employer is required to have a written policy in place with respect to electronic monitoring of employees on October 11, 2022. An individual becomes an employee of the employer on May 9, 2022, then the employer does not have to provide a written copy of the policy until November 10, 2022 (30 days after the employer was required to have a written policy in place). However, if an individual becomes an employee of the employer on December 6, 2022, then the employer must provide a copy of the written policy to the assignment within 30 days of December 6, 2022.
This obligation arises where the employer is a client of temporary help agency and the employer meets the 25-employee threshold based on the count of its employees.
Subsection 41.1.1(5) provides that an employer that is required to have a written policy with respect to electronic monitoring must provide a copy of the policy to an assignment employee who is assigned to perform work for the employer within 24 hours of the start of the assignment or within 30 days from the day the employer is required to have a policy in place, whichever is later. (Given this, an employer will never be required to provide a copy of its written policy to an assignment employee who performs work for it before the employer is required to provide a copy of the policy to its own employees.)
As an example, an employer is required to have a written policy in place with respect to electronic monitoring of employees on October 11, 2022. If an assignment employee is assigned to perform work for that employer on May 9, 2022, then the employer does not have to provide a written copy of the policy until November 10, 2022. However, if an assignment employee is assigned to perform work for the employer on December 6, 2022, then the employer must provide the written policy to the assignment within 24 hours of the start of the assignment.
“Days” in these subsections means calendar days. A copy of the written policy does not need to be provided to employees annually if the policy has not changed from the previous year. This is because the obligation arises only within 30 days of the policy being prepared or changed.
Where an employer has different policies for different employees or employee groups, it is Program policy that the obligation is to provide only a copy of the policy that applies to that particular employee. This applies equally to assignment employees.
For example, if the employer has different policies that apply to its IT staff, sales staff and managerial staff, an employee who does IT work only needs to receive a copy of the IT staff policy (in other words, the employer is not required to also provide that employee with a copy of the policies that apply to sales staff and managerial staff). If an assignment employee is assigned to perform work for the employer and the assignment employee will be engaging in IT work, the employer equally only needs to provide a copy of the IT staff policy to the assignment employee.
It is the Program’s position that an employer may provide the policy as a printed copy or as an attachment in an email to the employee. Further, and consistent with the Program's position regarding the provision of written wage statements under s. 12(1) and the information sheets for assignment employees under s. 74.7(3), an employer may provide the written policy via a link to the document on an internet database, if the employer ensures the employee has reasonable access to that database (i.e. the employer must ensure the employee has access to a computer - which includes devices such as tablets and smart phones - and is able to access a working link to the document) and ensures the employee has access to a printer and that the employee knows how to use the computer and the printer.
41.1.1(6) A complaint under subsection 96 (1) alleging a contravention of this section may be made only with respect to subsections (3), (4) and (5) and, for greater certainty, a person may not file a complaint alleging a contravention of any other provision of this section or have such a complaint investigated.
Subsection 41.1.1(6) was introduced into the ESA by the Working for Workers Act, 2022 on April 11, 2022. This provision limits the alleged contraventions under section 41.1.1 for which an employee or assignment employee can file a complaint with the ministry and limits what an employment standards officer can investigate under Part XI.1 in the course of a claim investigation.
A complaint can only be made to the ministry with respect to an alleged contravention of subsections 41.1.1 (3), (4) and (5). In other words, a complaint can be made and can be investigated by an employment standards officer only if the employee or assignment employee is alleging that the employer/client employer failed to provide a copy of the policy within the required timelines to: an existing employee (obligation set out in ss. 41.1.1(3)), a new employee (obligation set out in ss. 41.1.1(4)), or in respect of an assignment employee who is assigned to perform work for that employer (obligation set out in ss. 41.1.1(5)).
A complaint alleging any other contravention of section 41.1.1 cannot be made or investigated by an employment standards officer. This means, for example, that an employee is not able to make a complaint to the ministry where the employer’s policy allegedly does not contain all the required information, does not address all forms of electronic monitoring that the employer engages in, or alleging that the employer uses information obtained through the electronic monitoring of its employees differently that what is set out in its policy.
Similarly, where a claim is filed for a reason unrelated to Part XI.1 – say an employee filed a complaint claiming unpaid overtime – an employment standards officer who learns in the course of investigating that complaint of concerns the employee has with the employer’s electronic monitoring policy, would not be able to investigate any alleged contraventions under section 41.1.1 other than the requirements set out in subsections (3) to (5).
As an example, an employer may create a policy setting out that the information it collects through the electronic monitoring of employee internet usage is to be used by the employer only for the purpose of assessing overall employee productivity. If, however, the employer discovers through its electronic monitoring that an employee has been accessing inappropriate websites contrary to company IT policies, the employer can use that data for any reason, and is not limited by what was written in the policy. The employer can, for example, rely on that data to discipline or to terminate the employee, including to support its position that an exemption to ESA termination and severance entitlements arises due to the employee being guilty of wilful misconduct, disobedience, or wilful neglect of duty that is not trivial and has not been condoned by the employer.
Even though subsection (7) provides that, for greater certainty, nothing section 41.1.1 affects or limits an employer’s ability to use information obtained through the electronic monitoring of its employees, it is the policy of the Employment Standards Program that the principle applies equally in the context of a relationship between a client of a temporary help agency that is required to have a policy in place and an assignment employee who is assigned to perform work for that client. As such, it is Program policy that nothing in section 41.1.1 affects or limits the client of the temporary help agency from using information it has obtained through the electronic monitoring of an assignment employee.
Note that an employment standards officer who is provided with information obtained through the electronic monitoring of a claimant can equally use that information in determining the application of the ESA and its regulations; nothing in this section affects or limits an employment standards officer’s ability to use the information in making a determination on a claim.
This provision was added by the Working for Workers Act, 2022 (WFWA 2022). It is a transition provision that modifies the January 1st and March 1st dates set out in subsection (1) for when the WFWA receives Royal Assent and Part XI.1 first comes into force (note this occurred on April 11, 2022). It provides that:
Subsection 41.1.1(8) no longer has any effect after the transition period. In other words, after 2022, the timelines set out in subsection (1) will apply: employers will take a “snapshot” of the number of employees they employ on January 1, beginning in 2023, to determine if the “25-employee threshold” is met and, if it is, they are required to have a written policy in place before March 1 of that year.
Although the equal pay legislation was initially written to redress the problem of lower wages paid to females, Part XII of the Employment Standards Act, 2000 ensures that employees (both male and female) in Ontario are not paid a lower wage than their co-workers simply because of their sex.
The Pay Equity Act, RSO 1990, c P.7,was enacted in 1987 and came into force on January 1, 1988. It imposes a requirement commonly referred to in this country as "equal pay for work of equal value", which is also known as "comparable worth" in the United States and "equal pay for equal value" in Europe.
The purpose of the Pay Equity Act is to remove systemic gender discrimination from employers' compensation practices.
Pay equity is different from the s. 42 equal pay provision under the ESA 2000 in that the pay equity legislation compares wage rates of female job classes to male job classes to ensure that women performing jobs that are different from but of equal value to jobs performed by men will receive equal pay. (Note: subsequent amendments to the Pay Equity Act also imposed a "proportional value" requirement where the jobs are not equal.) Section 42 of the ESA 2000, on the other hand, requires that women performing substantially the same job as men, and vice versa, receive equal pay.
The Pay Equity Act is intended to eliminate the wage gap that exists due to the undervaluation of what is typically thought of as "women’s work". Therefore, the equal pay provision in the ESA 2000 continues to be a remedy where a wage gap exists between men and women performing substantially the same jobs.
The Pay Equity Act is administered by the Pay Equity Commission, under the direction of a Pay Equity Commissioner who reports to the Minister of Labour. Inquiries concerning pay equity should be directed to the Pay Equity Commission.
Section 41.2 clarifies that for the purposes of the equal pay for equal work provisions in ESA Part XII, “substantially the same” means substantially the same but not necessarily identical. This provision informs the interpretation of the ESA Part XII, s. 42(1), s. 42.1(1) and s. 42.2(1).
This section prohibits an employer from paying an employee a lower rate of pay than another employee on the basis of sex, where the employees perform “equal work”, as established in clauses (a) through (c). This requirement is subject to certain exceptions that are set out in s. 42(2) of the Employment Standards Act, 2000.
Section 42 addresses a difference in the rate of pay between a male and a female, and vice versa. Two males, or alternately, two females, could be paid different rates of pay for performing “equal work” with no violation of this section occurring. Accordingly, the comparison must be between a male and female. Either a male or a female may be the lower paid employee, requiring the situation to be redressed.
For this provision to apply, there must be a difference in the rate of pay between a female and a male employee who perform “equal work”.
“Rate of pay” is not defined in the legislation.
It is Program policy that, for the purposes of Part XII, rate of pay generally includes:
It is Program policy that, for the purposes of Part XII, rate of pay generally does not include:
There may be other forms of remuneration that could be captured under “rate of pay” that are not addressed in the list above. For example, there may be situations where certain bonus structures would properly fall under “rate of pay”, whereas other bonus structures would not. In assessing whether particular remuneration contributes to an employee’s “rate of pay”, an employment standards officer will consider all relevant factors, including the specifics of the compensation system, its purpose, and the legislative intent behind Part XII.
When determining whether there is a difference in the rate of pay between employees earning commissions, or employees who are subject to piece work rates, an employment standards officer will compare the rates applicable to both employees. For example, if a female and male employee both earn minimum wage plus 15% commission on all sales, the employees will be considered to be paid the same rate of pay even if one of the employees takes home a greater dollar amount because he or she made more sales. A similar approach will be taken with respect to overtime. As long as two employees are subject to the same overtime rate and overtime threshold, there would not be a difference in the rate of overtime pay between the two employees. One employee may earn more overtime pay than another because they work more hours, but this would not mean that there is a difference in the overtime rate between the employees.
One question that might arise is how to conduct a comparison in rate of pay between two employees who do “equal work” but who are paid pursuant to different compensation schemes. Comparing a set hourly rate or yearly salary to earnings that may fluctuate based on employee performance, such as commission or piece work, is not a viable assessment. It is Program policy that, generally, comparisons can only be made between two employees with the same remuneration scheme - in other words, only by comparing “apples to apples”. For example, if a female employee earns $24 an hour, an employment standards officer will not compare her rate of pay with a male employee who earns $18 an hour plus a commission rate. One exception, however, is the comparison between employees earning an hourly, weekly, or monthly rate, or a yearly salary; the comparison becomes “apples to apples” once it is established what each employee earns as an hourly rate and thus a direct comparison is possible. Similarly, an “apples to apples” comparison is possible where two employees, for example, both earn $25 per hour but one of the two also earns a 10% commission on sales. In this case, though there are different remuneration schemes, a direct comparison is possible because the employees earn exactly the same rate in one element of the remuneration scheme. In this example, the obvious outcome is that the rates of pay are not the same.
For this provision to apply, the female and male employees who are being compared must perform “equal work”. The elements that make up “equal work” are established in clauses 42(1)(a) through (c). In order for work to be considered equal, all of the following must be present:
Each of these elements is examined individually in the analysis below.
Until January 1, 1975, the equal pay section of the Act set out that the male and female employees were to be paid the same wage "… for the same kind of work… the performance of which requires equal skill, effort and responsibility. . ."
In Regina v Howard et al., Ex parte Municipality of Metropolitan Toronto, 1970 CanLII 395 (ON CA), the Ontario Court of Appeal overturned a lower court decision and stated that "to construe ‘the same work’ as meaning ‘the identical work’ is to render completely redundant the words following ‘the performance of which requires equal skill, effort and responsibility.’" This decision led to legislative amendment of this section of the Act to its current wording in s. 42(1)(a) i.e. to reflect the court’s ruling, which was consistent with the policy intent of the provision.
Further to that, the Fair Workplaces Better Jobs Act, 2017 introduced a definition to Part XII of the ESA 2000 that took effect on April 1, 2018. Section 41.2 defines “substantially the same” to mean substantially the same but not necessarily identical.
"Substantially the same kind of work" refers to the main characteristics or the core duties of the work. Jobs do not have to be identical for this standard to apply. Minor differences in job content do not, in and of themselves, make the section inapplicable.
When considering whether the kind of work is “substantially the same”, the work to be compared is work that the employees are performing contemporaneously. The comparison is to be made on the basis of the actual work the employees perform, not the terms of hiring, or the job descriptions.
An officer must look at the jobs as a whole and consider all information that is relevant in the particular circumstances. There are a number of different possible scenarios where a finding of substantially the same kind of work may be made.
For example, where two employees perform identical tasks 90% of the time and different tasks only 10% of the time, an officer may conclude that the employees perform substantially the same kind of work – i.e. the time spent on different tasks is not so extensive as to support a finding that the overall kind of work being performed is not substantially the same.
Similarly, a finding that substantially the same kind of work is being performed may be made where 90% of the employees' time is spent performing tasks that, although not identical, are so alike as to warrant that finding even though 10% of their time is spent on tasks that are different. Note that in the context of these provisions, it is the work itself that is being compared, not the value of the work (as is the case in the pay equity context).
The examples above are provided as illustrations of possible scenarios where a finding of substantially the same kind of work may be made. They are not intended to be an exhaustive list of such scenarios or to suggest that, as a threshold, 90% of the employees’ time must be spent on work that is identical or so alike before a finding that substantially the same kind of work is being performed can be made. Rather, the examples are provided as a point of reference only and are meant to assist in achieving general consistency in the interpretation of this provision. The examples do not establish a “rule” or a “test” and they should not be applied in a formulaic way without consideration of all relevant information. There may be situations where a higher or lower percentage of time may be spent on tasks that are identical or so alike, such that a finding that substantially the same kind of work is being performed is appropriate.
The term "establishment" is defined in s. 1 of the ESA 2000 as follows:
"Establishment" means a location where the employer carries on business. However, two or more locations of the employer will be considered a single establishment if:
See ESA Part I, s. 1 of the Manual for further information regarding the definition of establishment.
Per s. 42(1)(b), the performance of the work must require substantially the same skill, effort and responsibility. These are three separate requirements, each of which must be met in order for s. 42 to apply.
The Fair Workplaces Better Jobs Act, 2017 introduced a definition in Part XII of the ESA 2000 that took effect on April 1, 2018. Section 41.2 defines “substantially the same” to mean substantially the same but not necessarily identical.
This further clarified that the skill, effort and responsibilities do not need to be exactly the same or identical to be considered substantially the same. Minor or inconsequential differences do not render the standard inapplicable.
The requirement for skill, effort and responsibility are applied to the actual work that the employees perform, and not their terms of hiring, job description or job title. The work that is to be compared is work that the employees are performing contemporaneously. The jobs must be evaluated as a whole. The fact that there are some differences in tasks between two jobs would not be a sufficient reason, in and of itself, to establish that the jobs do not require the same skill, effort or responsibility.
Skill refers to the degree or amount of knowledge or physical or motor capability needed by the employee performing the job. It includes factors such as education, manual dexterity, experience and training, and is measured in terms of performance requirements
Effort is the physical or mental exertion needed to perform a job. An example of physical effort is the amount of strength a labourer needs to lift packed boxes. An example of mental effort is the amount of thinking and concentration required by a bookkeeper to balance the books.
When determining whether the performance of the work requires substantially the same effort, the evaluation is based on the effort required for the work itself, and not on the effort expended by a particular individual. For example, where two employees lift 50 pound boxes, it is irrelevant that one employee finds the task to be very physically demanding while the other employee finds the same task to be quite effortless. However, it would take substantially more effort for an employee to lift 80 pound boxes as compared to an employee who lifts boxes that weigh only 10 pounds. As a result, where two jobs have different weight lifting requirements (e.g. 80 pounds versus 10 pounds), they may not satisfy the requirement that the work require substantially the same amount of effort.
The sporadic performance of an activity that may require extra physical or mental effort does not suffice to establish that the jobs require substantially different levels of effort.
Responsibility is measured by the number and nature of an employee’s job obligations, the degree of accountability and the degree of authority exercised by an employee in the performance of the job. Some factors to consider include:
For example, an employee who always performs assigned tasks and duties in accordance with specific, detailed instructions would not have substantially the same degree of responsibility as an employee who works only from general policy objectives and refers to superiors on an infrequent basis only, when interpretations of organizational policy are in question.
As another example, where one employee is responsible for collecting and providing the money from individual cash registers to the accounting department, that employee would likely have more responsibility than an employee who does not handle any cash, or who handles cash only rarely in the performance of his or her job.
The working conditions between the two jobs being compared must be “similar”. (Note this is a lower threshold than “substantially the same,” as defined in s. 41.2 and applied in the “substantially the same kind of work” and “substantially the same skill, effort and responsibility” parts of the test).
"Working conditions" generally refer to factors such as:
For example, appliance repairers who spend all their time on the employer’s premises do not have similar working conditions to appliance repairers who do their work attending at customers’ homes.
The prohibition against paying different rates of pay to employees of different sexes who perform “equal work”, per s. 42(1) does not apply if the difference in the rate of pay is made on the basis of one of the exceptions set out in subsection (2).
In order to fall within this exception, the difference in rate of pay must result from a system established by the employer in which employees’ compensation is at least partially based on their length of service or accumulated number of hours worked. The same system must apply to both employees being compared.
Note that where the employer does not have an established seniority system, a difference in rate of pay may be still be based on a “seniority-like” factor per subsection (d) below. For example, a longer-term employee may earn a higher rate of pay than a newly hired employee based informally on years of service.
In order to fall within this exception, the difference in rate of pay must result from a system established by the employer in which employees’ compensation is at least partially based on their achievements and/or how well they perform their jobs. The system must apply to both employees being compared.
For example, an employer may increase employees’ hourly wages by a set percentage if they meet a pre-established sales target. If an employee of one sex reaches the sales target before an employee of the opposite sex, and therefore earns a greater hourly wage, the difference in rate of pay is permissible under this provision.
Note that where the employer does not have an established merit system, a difference in rate of pay may be still be based on a “merit-like” factor (such as high productivity, above-average sales, exceptional customer service etc.) per subsection (d) below. Please see the discussion below for more information.
This exception provides that a difference in rate of pay is not prohibited where the workplace has a system in place that measures earnings by quantity or quality of production. In order for this exception to apply, the system must apply to both employees being compared.
For example, an employer operates a widget factory and employs manufacturing employees who perform equal work. All employees receive $1.00 per completed widget, and receive a pay increase of 15 cents per widget after they complete 1,000 widgets. A difference in rate of pay will be justified where an employee of one sex earns $1.00 per completed widget because he or she has not yet reached the 1,000 threshold, while a comparator employee of the opposite sex who has already completed 1,000 widgets earns $1.15 per widget.
Note that between April 1, 2018 and December 31, 2018, this provision read as “Any other factor other than sex or employment status”. “Employment status” was added to s.42(2)(d) on April 1, 2018 as a result of the Fair Workplaces Better Jobs Act, 2017; the amendment was consistent with the prohibition set out in s.42.1 that also came into force on April 1, 2018. The “or employment status” wording was repealed on January 1, 2019 as a result of the Making Ontario Open for Business Act, 2018, which also repealed s.42.1 in its entirety.
This clause provides that the prohibition against paying different rates of pay to two employees of different sexes performing “equal work” per s. 42(1) does not apply if the difference is based on any factor other than sex. The broad scope of this exception acknowledges the myriad of factors other than sex come into play when pay rates are determined. In practice, this exception allows for a differentiation in rate of pay based on a wide variety of factors, including those that are subjective. Note, however, that the factor (or factors) that the employer provides as the reason(s) for the pay differential must be the actual reason(s). Employment standards officers will review and assess the credibility of any available evidence (which may in some cases be limited to the employer’s assertions) in order to satisfy him or herself that the reason(s) provided are in fact the actual reason(s) for the pay differential. Note that it is possible for a “factor” used to support a difference in the rate of pay to fit within the s. 42(2)(d) exception, but to be prohibited by legislation that is not administered by the Ministry of Labour, such as the Ontario Human Rights Code.
The key determination to be made in applying this provision is whether the “factor” used to support the difference in the rate of pay is sex. The question to be answered is whether the employee is earning a particular rate of pay because he is male or she is female. If the answer is yes, this exception does not apply and equal pay is required. If the factor is anything other than sex, then this exception does apply.
Some examples of factors that the Program generally considers to fall under “any other factor other than sex” include:
Even where the work is “equal”, a difference in relevant experience with another employer or educational achievement may be a “factor other than sex”, such that the requirement for equal pay would not apply.
Where the employer does not have an established seniority system, a “seniority-like” factor may be a “factor other than sex”, such that the requirement for equal pay would not apply. For example, a new hire may receive a lesser rate of pay than an employee who has been employed for a longer period of time on the basis that he or she has less service.
Where one of the two employees being compared is covered by a collective agreement: the Program considers a difference in rate of pay that arises out of the collective bargaining process to be a “factor other than sex” such that the requirement for equal pay would not apply.
This policy does not apply where the two employees being compared are covered by the same collective agreement. Note, however, that in this situation, differences in rate of pay might be substantiated under other exceptions.
Some employers engage in the practice of “red circling”. This means they maintain an employee’s rate of pay, even after transferring the employee to a job that normally pays a lower rate. An example of this is an employee transferred to a lower paying job due to a company reorganization. Under a pure "red-circling" system, the higher-paid employee would remain at the present rate of pay until the lower paid employees catch up. "Red circling" is generally considered to be a “factor other than sex”, meaning that the requirement for equal pay would not apply.
The nature of the job market at a particular point in time may require an employer to offer a higher rate of pay to attract an employee to fill a particular role in its organization if the supply of qualified candidates is low. This is generally considered to be a “factor other than sex”, meaning that the requirement for equal pay would not apply.
Paying an employee more (or less) than another employee because he or she is part of the employer’s family is a “factor other than sex”, meaning that the requirement for equal pay would not apply.
For example, an employer who sets up his or her business affairs in order to take advantage of tax benefits such as income splitting may pay his or her spouse more than another employee in order to maximize tax benefits.
In some cases, a difference in the shifts that are being worked by employees may mean that “equal work” is not being performed (e.g. a security guard on the day shift and a security guard on the night shift who have very different duties, level of responsibility and working conditions).
In certain situations, despite work between two employees on different shifts being “equal” per s. 42(1), the employer may pay a wage premium. This may be, for example, to compensate employees who work the evening shift for the inconvenience of working at that time. This rationale for providing a wage premium is considered to be a “factor other than sex”, meaning that the requirement for equal pay would not apply.
The question may arise as to whether an employee temporarily working in another role is an exception to the requirement in s. 42. An employee, for example, may temporarily occupy another position that has a different rate of pay, yet maintain the rate of pay associated with their “home” position (which may be higher or lower than the pay rate of the other employees in the temporary position.)
Whether or not this raises equal pay concerns will depend on the circumstances. For example, there may be an issue as to whether the employee who is temporarily performing the duties of another position is performing “equal work” to the other employees in that position. For example, the employee who is temporarily performing the duties may have substantially fewer or more responsibilities than the other employee(s) (e.g. a non-managerial employee may be in an acting assignment as manager but not be required to perform the tasks associated with disciplining employees).
If “equal work” is being performed by the employee who is temporarily in the position and an employee of the opposite sex whose “regular” job is to work in that position, the employer may nonetheless be permitted to maintain the differential in their rates of pay on the basis of any other factor other than sex. For example, assume that an employee who is temporarily in a position is permitted to maintain his or her usual, higher rate of pay for the duration of the temporary assignment. The employer may maintain that the difference in pay rate was based on the sudden or urgent need to fill the position and that the only practical way to do so was to transfer the higher-paid employee at his or her current rate of pay. The employer might also have a policy establishing as its regular practice that employees who temporarily “fill in” doing work in another role maintain their higher rate of pay. These reasons both constitute “any other factor other than sex” under s. 42(2)(d).
Conversely, if the employee who is temporarily in the position has a lower rate of pay than an employee doing “equal work”, the employer may pay that employee less because – although the work is “equal” (as per s. 42(1)) – the employee temporarily in the position is less experienced, not expected to perform all of the duties normally associated with that position, or on the basis of any other factor as discussed elsewhere in this section. All of these reasons constitute “any other factor other than sex”. However, if the difference in rate of pay is not based on a factor other than sex, the employer will be required to equalize the pay rates.
An employer may pay an employee a higher rate of pay based on a factor such as the employee being well liked by key clients, being particularly friendly or because that employee is seen as always “going the extra mile”. Examples such as these, even though they may be based on the subjective opinion of the employer, may still constitute a “factor other than sex or employment status” meaning the requirement for equal pay would not apply.
Section 42(3) prohibits an employer from reducing an employee’s rate of pay to comply with s. 42(1). This means that where there is a difference in the rate of pay between employees in contravention of section 42, the employer cannot lower the higher-paid employee’s rate of pay to correct the violation.
For example, a male and a female both work as lifeguards performing equal work and none of the exceptions in s. 42(2) apply. The male employee earns a salary of $45,000 per year. The female employee earns $3,500 per month, which is equivalent to $42,000 per year. The employees work the same number of hours. The employer is prohibited from reducing the male employee’s rate of pay to $42,000 per year to comply with s. 42(1).
This section reinforces s. 5(1) of the Act, which states:
A trade union or other organization is prohibited from causing or attempting to cause the employer to pay different rates of pay to employees who do “equal work” per s. 42(1) on the basis that they are different sexes.
This section permits an employment standards officer to determine the amount owed to an employee as a result of the contravention of s. 42(1), and deems that amount owing to be unpaid wages. An employment standards officer may consequently issue an order to pay wages under ESA Part XXII, s. 103 against an employer. This order may include the amount necessary to correct the inequality in the rate of pay between employees and may also include amounts owing under other standards that were calculated in the relevant period using the rate of pay that was found to violate s. 42. This may include, for example, vacation pay, public holiday pay, overtime pay, termination pay, etc.
Note that a director order to pay cannot be issued in relation to these deemed wages per s. 81(3).
Subsection 42(6) came into force on April 1, 2018. It was added to section 42 as a result of the Fair Workplaces, Better Jobs Act, 2017. It was repealed pursuant to the Making Ontario Open for Business Act, 2018 effective January 1, 2019.
This subsection provides that employees who believe that their employer is not complying with s. 42(1) may ask the employer to review their rate of pay. In response, the employer must review the employee’s rate of pay and either adjust it upwards to address the contravention, or provide a written response that sets out the reasons why the employer disagrees with the employee’s belief that there is a contravention.
The requirement that the employer’s response be in writing is satisfied if the response is provided to the employee on paper (for example, in a printed letter) or electronically.
Section 42(6)(b) does not specify a timeline within which the employer must provide the written response. It is Program policy that the employer’s response must be provided within a reasonable timeframe; what is reasonable will depend on the particular circumstances.
Note that this section does not require an employee to request a review of their rate of pay as a prerequisite to filing a claim under ESA Part XXII, s. 96(1). In other words, an employee who believes his or her rate of pay does not comply with s. 42(1) may file a claim without ever requesting a rate of pay review from the employer.
The requirement in this subsection to adjust the employee’s pay rate applies prospectively only; it does not require the employer to retroactively pay the employee what they would have earned had they received equal pay prior to the adjustment. However, an employee may file a claim to recover any amounts owing prior to the adjustment (subject to the limitations on recovery set out in section 111).
Section 42.1 of the Employment Standards Act, 2000 was repealed effective January 1, 2019 as a result of the Making Ontario Open for Business Act, 2018. This section is therefore no longer in force. However, employees may still have a complaint relating to section 42.1 that arose during the period of time when the section was in force: from April 1, 2018 to December 31, 2018. For that reason, the Program’s interpretation of this section remains as part of this publication, though the text appears in red to highlight that the relevant provisions have been repealed.
Subsection 42.1(1) was repealed effective January 1, 2019 as a result of the Making Ontario Open for Business Act, 2018. This provision is no longer in force. The discussion of this provision is being maintained for use in situations that arose when it was in force.
Section 42.1 was added to the Employment Standards Act, 2000 (ESA 2000) as a result of the Fair Workplaces, Better Jobs Act, 2017; it came into effect on April 1, 2018. It was repealed effective January 1, 2019 by the Making Ontario Open for Business Act, 2018.
This section prohibits an employer from paying an employee a lower rate of pay than another employee on the basis of a difference in employment status, where the employees perform “equal work”, as established in clauses (a) through (c). This requirement is subject to certain exceptions that are set out in s. 42.1(2) of the ESA 2000.
Note that certain employees are exempted from s. 42.1 – see O Reg 285/01, s. 9.1 for further information.
Section 42.1 addresses a difference in the rate of pay between two employees of the same employer with different employment status.
Section 1 of the ESA defines difference in employment status as follows:
See ESA Part I, s. 1 for a discussion of this definition.
Under this provision, the comparison of work performed must be between employees with a difference in employment status. Two employees of the same “employment status” could be paid different rates of pay for performing “equal work” with no violation of this section occurring. The work being compared is work that is being performed by the two employees contemporaneously.
Note that subject to certain exceptions, s. 42(1) prohibits employers from paying employees different rates of pay for “equal work” if one employee is being paid less due to a difference in sex. As such, although it would not be a violation of s. 42.1 for two employees of the same “employment status” to be paid differently, a potential violation could exist under sections 42 if there is a difference in sex between these employees. Also, where an employee is an assignment employee, the employer is prohibited from paying the assignment employee at a rate of pay less than the rate paid to an employee of the client when performing equal work, see section 42.2.
For this provision to apply, there must be a difference in the rate of pay between two employees of different employment status who perform “equal work”.
“Rate of pay” is not defined in the legislation.
It is Program policy that, for the purposes of Part XII, rate of pay generally includes:
It is Program policy that, for the purposes of Part XII, rate of pay generally does not include:
There may be other forms of remuneration that could be captured under “rate of pay” that are not addressed in the list above. For example, there may be situations where certain bonus structures would properly fall under “rate of pay”, whereas other bonus structures would not. In assessing whether particular remuneration contributes to an employee’s “rate of pay”, an employment standards officer will consider all relevant factors, including the specifics of the compensation system, its purpose, and the legislative intent behind Part XII.
When determining whether there is a difference in the rate of pay between employees earning commissions, or employees who are subject to piece work rates, an employment standards officer will compare the rates applicable to both employees. For example, if a full-time and a part-time employee both earn minimum wage plus 15% commission on all sales, the employees will be considered to be paid the same rate of pay even if one of the employees takes home a greater dollar amount because that employee made more sales. A similar approach will be taken with respect to overtime. As long as two employees are subject to the same overtime rate and overtime threshold, there would not be a difference in the rate of overtime pay between the two employees. One employee may earn more overtime pay than another because they work more hours, but this would not mean that there is a difference in the overtime rate between the employees.
One question that might arise is how to conduct a comparison in rate of pay between two employees who do “equal work” but who are paid pursuant to different compensation schemes. Comparing a set hourly rate or yearly salary to earnings that may fluctuate based on employee performance, such as commission or piece work, is not a viable assessment. It is Program policy that, generally, comparisons can only be made between two employees with the same remuneration scheme – in other words, only by comparing “apples to apples”. For example, if a female employee earns $24 an hour, an employment standards officer will not compare her rate of pay with a male employee who earns $18 an hour plus a commission rate. One exception, however, is the comparison between employees earning an hourly, weekly, or monthly rate, or a yearly salary; the comparison becomes “apples to apples” once it is established what each employee earns as an hourly rate and thus a direct comparison is possible. Similarly, an “apples to apples” comparison is possible where two employees, for example, both earn $25 per hour but one of the two also earns a 10% commission on sales. In this case, though there are different remuneration schemes, a direct comparison is possible because the employees earn exactly the same rate in one element of the remuneration scheme. In this example, the obvious outcome is that the rates of pay are not the same.
For this provision to apply, employees of different employment status who are being compared must perform “equal work”. The elements that make up “equal work” are established in clauses 42.1(a) through (c). In order for work to be considered equal, all of the following must be present:
Each of these elements is examined individually in the analysis below.
The employees being compared must perform substantially the same kind of work. The Fair Workplaces Better Jobs Act, 2017 introduced a definition to Part XII of the ESA 2000 that took effect on April 1, 2018. Section 41.2 defines “substantially the same” to mean substantially the same but not necessarily identical.
In other words, jobs do not have to be identical for this standard to apply. "Substantially the same kind of work" refers to the main characteristics or the core duties of the work. Minor differences in job content do not, in and of themselves, make the section inapplicable.
When considering whether the kind of work is “substantially the same”, the work to be compared is generally work that the employees are performing contemporaneously. The comparison is to be made on the basis of the actual work the employees perform, not the terms of hiring, or the job descriptions.
An officer must look at the jobs as a whole and consider all information that is relevant in the particular circumstances. There are a number of different possible scenarios where a finding of substantially the same kind of work may be made.
For example, where two employees perform identical tasks 90% of the time and different tasks only 10% of the time, an officer may conclude that the employees perform substantially the same kind of work – i.e. the time spent on different tasks is not so extensive as to support a finding that the overall kind of work being performed is not substantially the same.
Similarly, a finding that substantially the same kind of work is being performed may be made where 90% of the employees' time is spent performing tasks that, although not identical, are so alike as to warrant that finding even though 10% of their time is spent on tasks that are different. Note that in the context of these provisions, it is the work itself that is being compared, not the value of the work (as is the case in the pay equity context).
The examples above are provided as illustrations of possible scenarios where a finding of substantially the same kind of work may be made. They are not intended to be an exhaustive list of such scenarios or to suggest that, as a threshold, 90% of the employees’ time must be spent on work that is identical or so alike before a finding that substantially the same kind of work is being performed can be made. Rather, the examples are provided as a point of reference only and are meant to assist in achieving general consistency in the interpretation of this provision. The examples do not establish a “rule” or a “test” and they should not be applied in a formulaic way without consideration of all relevant information. There may be situations where a higher or lower percentage of time may be spent on tasks that are identical or so alike, such that a finding that substantially the same kind of work is being performed is appropriate.
The term "establishment" is defined in s. 1 of the ESA 2000 as follows:
"Establishment" means a location where the employer carries on business. However, two or more locations of the employer will be considered a single establishment if:
See ESA Part I, s. 1 of the Manual for further information regarding the definition of establishment.
Per s. 42.1(1)(b), the performance of the work must require substantially the same skill, effort and responsibility. These are three separate requirements, each of which must be met in order for s. 42.1 to apply.
The Fair Workplaces Better Jobs Act, 2017 introduced a definition in Part XII of the ESA 2000 that took effect on April 1, 2018. Section 41.2 defines “substantially the same” to mean substantially the same but not necessarily identical.
This clarifies that the skill, effort and responsibilities do not need to be exactly the same or identical in every respect to be considered substantially the same. Minor or inconsequential differences do not render the standard inapplicable.
The requirement for skill, effort and responsibility are applied to the actual work that the employees perform, and not their terms of hiring, job description or job title. The work that is to be compared is work that the employees are performing contemporaneously. The jobs must be evaluated as a whole. The fact that there are some differences in tasks between two jobs would not be a sufficient reason, in and of itself, to establish that the jobs do not require the same skill, effort or responsibility.
Skill refers to the degree or amount of knowledge or physical or motor capability needed by the employee performing the job. It includes factors such as education, manual dexterity, experience and training, and is measured in terms of performance requirements.
Effort is the physical or mental exertion needed to perform a job. An example of physical effort is the amount of strength a labourer needs to lift packed boxes. An example of mental effort is the amount of thinking and concentration required by a bookkeeper to balance the books.
When determining whether the performance of the work requires substantially the same effort, the evaluation is based on the effort required for the work itself, and not on the effort expended by a particular individual. For example, where two employees lift 50 pound boxes, it is irrelevant that one employee finds the task to be very physically demanding while the other employee finds the same task to be quite effortless. However, it would take substantially more effort for an employee to lift 80 pound boxes as compared to an employee who lifts boxes that weigh only 10 pounds. As a result, where two jobs have different weight lifting requirements (e.g. 80 pounds versus 10 pounds), they may not satisfy the requirement that the work require substantially the same amount of effort.
The sporadic performance of an activity that may require extra physical or mental effort does not suffice to establish that the jobs require substantially different levels of effort.
Responsibility is measured by the number and nature of an employee’s job obligations, the degree of accountability and the degree of authority exercised by an employee in the performance of the job. Some factors to consider include:
For example, an employee who always performs assigned tasks and duties in accordance with specific, detailed instructions would not have substantially the same degree of responsibility as an employee who works only from general policy objectives and refers to superiors on an infrequent basis only, when interpretations of organizational policy are in question.
As another example, where one employee is responsible for collecting and providing the money from individual cash registers to the accounting department, that employee would likely have more responsibility than an employee who does not handle any cash, or who handles cash only rarely in the performance of their job.
The working conditions between the two jobs being compared must be “similar”. (Note this is a lower threshold than “substantially the same” as defined in s. 41.2 and applied in in the “substantially the same kind of work” and “substantially the same skill, effort and responsibility” parts of the test.)
"Working conditions" generally refer to factors such as:
For example, appliance repairers who spend all their time on the employer’s premises do not have similar working conditions to appliance repairers who do their work attending at customers’ homes.
Subsection 42.1(2) was repealed effective January 1, 2019 as a result of the Making Ontario Open for Business Act, 2018. This provision is no longer in force. The discussion of this provision is being maintained for use in situations that arose when it was in force.
The prohibition against paying different rates of pay to employees of different employment status who perform “equal work”, per s. 42.1(1) does not apply if the difference in the rate of pay is made on the basis of one of the exceptions set out in subsection (2).
In order to fall within this exception, the difference in rate of pay must result from a system established by the employer in which employees’ compensation is at least partially based on their length of service or accumulated number of hours worked. The same system must apply to both employees being compared.
Note that where the employer does not have an established seniority system, a difference in rate of pay may be still be based on a “seniority-like” factor per subsection (d) below. For example, a longer-term employee may earn a higher rate of pay than a newly hired employee based informally on years of service. Please see the discussion under clause (d) for more information.
In order to fall within this exception, the difference in rate of pay must result from a system established by the employer in which employees’ compensation is at least partially based on their achievements and/or how well they perform their jobs. The system must apply to both employees being compared.
For example, an employer may increase employees’ hourly wages by a set percentage if they meet a pre-established sales target. If an employee of one employment status reaches the sales target before an employee with a different employment status, and therefore earns a greater hourly wage, the difference in rate of pay is permissible under this provision.
Note that where the employer does not have an established merit system, a difference in rate of pay may be still be based on a “merit-like” factor (such as high productivity, above-average sales, exceptional customer service etc.) per subsection (d) below. Please see the discussion under clause (d) for more information.
This exception provides that a difference in rate of pay is not prohibited where the workplace has a system in place that measures earnings by quantity or quality of production. In order for this exception to apply, the system must apply to both employees being compared.
For example, an employer operates a widget factory and employs manufacturing employees who perform equal work. All employees receive $1.00 per completed widget, and receive a pay increase of 15 cents per widget after they complete 1,000 widgets. A difference in rate of pay will be justified where a temporary employee earns $1.00 per completed widget because they had not yet reached the 1,000 threshold, while a permanent employee who has already completed 1,000 widgets earns $1.15 per widget.
This clause provides that the prohibition against giving different rates of pay to two employees of different employment status performing “equal work” per s. 42.1(1) does not apply if the difference is based on any factor other than sex or employment status. The broad scope of this exception acknowledges the myriad of factors other than sex or employment status that come into play when pay rates are determined. In practice, this exception allows for a differentiation in rate of pay based on a wide variety of factors, including those that are subjective. Note, however, that the factor (or factors) that the employer provides as the reason(s) for the pay differential must be the actual reason(s). Employment standards officers will review and assess the credibility of any available evidence (which may in some cases be limited to the employer’s assertions) in order to satisfy themself that the reason(s) provided are in fact the actual reason(s) for the pay differential. Note that it is possible for a “factor” used to support a difference in the rate of pay to fit within the s. 42.1(2)(d) exception, but to be prohibited by legislation that is not administered by the Ministry of Labour, such as the Ontario Human Rights Code.
The key determination to be made in applying this provision is whether the “factor” used to support the difference in rate of pay is sex or employment status. If it is, this exception does not apply. If the factor is anything other than sex or employment status, then generally this exception does apply.
When determining whether the difference in rate of pay is based on “employment status”, the question to be answered is whether the employee is earning a particular rate of pay because of the number of hours they regularly work or because of the term of their employment (such as permanent, temporary, seasonal, or casual).
When determining whether the difference in rate of pay is based on “sex”, the question to be answered is whether the employee is earning a particular rate of pay because he is male or she is female.
If the answer to any of these three questions is yes, then the exception does not apply and equal pay is required per subsection 42.1(1).
Some examples of factors that the Program generally considers to fall under “any other factor other than sex or employment status” include:
Even where the work is “equal”, a difference in relevant experience with another employer or educational achievement may be a “factor other than sex or employment status”, such that the requirement for equal pay would not apply.
Where the employer does not have an established seniority system, a “seniority-like” factor may be a “factor other than sex or employment status”, such that the requirement for equal pay would not apply. For example, a new hire may receive a lesser rate of pay than an employee who has been employed for a longer period of time on the basis that they have less service.
Where one of the two employees being compared is covered by a collective agreement: the Program considers a difference in rate of pay that arises out of the collective bargaining process to be a “factor other than sex or employment status” such that the requirement for equal pay would not apply. For practical purposes, this means that a non-unionized employee and a unionized employee of different employment status can receive different rates of pay for performing “equal work”.
This policy does not apply where the two employees being compared are covered by the same collective agreement. Note, however, that in this situation, differences in rate of pay might be substantiated under other exceptions.
Some employers engage in the practice of “red circling”. This means they maintain an employee’s rate of pay, even after transferring the employee to a job that normally pays a lower rate. An example of this is an employee transferred to a lower paying job due to a company reorganization. Under a pure "red-circling" system, the higher-paid employee would remain at the present rate of pay until the lower paid employees catch up. "Red circling" is generally considered to be a “factor other than sex or employment status”, meaning that the requirement for equal pay would not apply.
The nature of the job market at a particular point in time may require an employer to offer a higher rate of pay to attract an employee to fill a particular role in its organization if the supply of qualified candidates is low. This is generally considered to be a “factor other than sex or employment status”, meaning that the requirement for equal pay would not apply.
Paying an employee more (or less) than another employee because they are part of the employer’s family is a “factor other than sex or employment status”, meaning that the requirement for equal pay would not apply.
In some cases, a difference in the shifts that are being worked by employees may mean that “equal work” is not being performed (e.g. a security guard on the day shift and a security guard on the night shift who have very different duties, level of responsibility and working conditions).
In certain situations, despite work between two employees on different shifts being “equal” per s. 42.1(1), the employer may pay a wage premium. This may be, for example, to compensate employees who work the evening shift for the inconvenience of working at that time. This rationale for providing a wage premium is considered to be a “factor other than sex or employment status”, meaning that the requirement for equal pay would not apply.
The question may arise as to whether an employee temporarily working in another role is an exception to the requirement in s. 42.1. An employee, for example, may temporarily occupy another position that has a different rate of pay, yet maintain the rate of pay associated with their “home” position (which may be higher or lower than the pay rate of the other employees in the temporary position).
Whether or not this raises equal pay concerns will depend on the circumstances. For example, there may be an issue as to whether the employee who is temporarily performing the duties of another position is performing “equal work” to the other employees in that position. For example, the employee who is temporarily performing the duties may have substantially fewer or more responsibilities than the other employee(s) (e.g. a non-managerial employee may be in an acting assignment as manager but not be required to perform the tasks associated with disciplining employees).
If “equal work” is being performed by the employee who is temporarily in the position and an employee of a different employment status whose “regular” job is to work in that position, the employer may nonetheless be permitted to maintain the differential in their rates of pay on the basis of any other factor other than sex or employment status. For example, assume that an employee who is temporarily in a position is permitted to maintain their usual, higher rate of pay for the duration of the temporary assignment. The employer may maintain that the difference in pay rate was based on the sudden or urgent need to fill the position and that the only practical way to do so was to transfer the higher-paid employee at their current rate of pay. The employer might also have a policy establishing as its regular practice that employees who temporarily “fill in” doing work in another role maintain their higher rate of pay. These reasons both constitute “any other factor other than sex or employment status” under s. 42.1(2)(d).
Conversely, if the employee who is temporarily in the position has a lower pay rate than an employee doing “equal work”, the employer may pay that employee less because – although the work is “equal” (as per s. 42.1(1)) – the employee temporarily in the position is less experienced, not expected to perform all of the duties normally associated with that position, or on the basis of any other factor as discussed elsewhere in this section. All of these reasons constitute “any other factor other than sex or employment status”. However, if the difference in rate of pay is not based on a factor other than sex or employment status, the employer will be required to equalize the pay rates.
(Note that temporarily working in another position does not necessarily involve a change in employment status. For example, a permanent full-time employee may remain a permanent full-time employee when taking on a temporary work assignment.)
An employer may pay an employee a higher rate of pay based on a factor such as the employee being well liked by key clients, being particularly friendly or because that employee is seen as always “going the extra mile”. Examples such as these, even though they may be based on the subjective opinion of the employer, constitute a “factor other than sex” meaning the requirement for equal pay would not apply.
Subsection 42.1(3) was repealed effective January 1, 2019 as a result of the Making Ontario Open for Business Act, 2018. This provision is no longer in force. The discussion of this provision is being maintained for use in situations that arose when it was in force.
Section 42.1(3) prohibits an employer from reducing an employee’s rate of pay to comply with s. 42.1(1). This means that where there is a difference in the rate of pay between employees in contravention of section 42.1, the employer cannot lower the higher-paid employee’s rate of pay to correct the violation.
For example, two employees of different employment status both work as cooks performing equal work and none of the exceptions in s. 42.1(2) apply. The permanent employee earns a salary of $45,000 per year. The temporary employee earns $3,500 per month, which is equivalent to $42,000 per year. The employees work the same number of hours.The employer is prohibited from reducing the first employee’s rate of pay to $42,000 per year to comply with s. 42.1(1).
Subsection 42.1(4) was repealed effective January 1, 2019 as a result of the Making Ontario Open for Business Act, 2018. This provision is no longer in force. The discussion of this provision is being maintained for use in situations that arose when it was in force.
This section reinforces s. 5(1) of the Act, which states:
A trade union or other organization is prohibited from causing or attempting to cause the employer to pay different rates of pay to employees who do “equal work” per s. 42.1(1) on the basis that the employees have different employment status.
Subsection 42.1(5) was repealed effective January 1, 2019 as a result of the Making Ontario Open for Business Act, 2018. This provision is no longer in force. The discussion of this provision is being maintained for use in situations that arose when it was in force.
This section permits the employment standards officer to determine the amount owed to an employee as a result of the contravention of s. 42.1(1), and deems that amount owing to be unpaid wages. An employment standards officer may consequently issue an order to pay wages under ESA Part XXII, s. 103 against an employer. This order may include the amount necessary to correct the inequality in the rate of pay between employees and may also include amounts owing under other standards that were calculated in the relevant period using the rate of pay that was found to violate s. 42.1. This may include, for example, vacation pay, public holiday pay, overtime pay, termination pay, etc.
Note that a director order to pay cannot be issued in relation to these deemed wages per s. 81(3).
Subsection 42(6) was repealed effective January 1, 2019 as a result of the Making Ontario Open for Business Act, 2018. This provision is therefore no longer in force. However, the Program’s interpretation of this provision remains in this publication as complaints may still arise relating to the period of time when the provision was in force: from April 1, 2018 to December 31, 2018.
This subsection provides that employees who believe that their employer is not complying with s. 42.1(1) may ask the employer to review their rate of pay. In response, the employer must review the employee’s rate of pay and either adjust it upwards to address the contravention, or provide a written response that sets out the reasons why the employer disagrees with the employee’s belief that there is a contravention.
The requirement that the employer’s response be in writing is satisfied if the response is provided to the employee on paper (for example, in a printed letter) or electronically.
Section 42.1(6)(b) does not specify a timeline within which the employer must provide the written response. It is Program policy that the employer’s response must be provided within a reasonable timeframe; what is reasonable will depend on the particular circumstances.
Note that this section does not require an employee to request a review of their rate of pay as a prerequisite to filing a claim under ESA Part XXII, s. 96(1). In other words, an employee who believes their rate of pay does not comply with s. 42.1(1) may file a claim without ever requesting a review of their rate of pay from their employer.
The requirement in this subsection to adjust the employee’s pay rate applies prospectively only; it does not require the employer to retroactively pay the employee what they would have earned had they received equal pay prior to the adjustment. However, an employee may file a claim in order to recover any amounts owing prior to the adjustment (subject to the limitations on recovery set out in section 111).
Subsection 42.1(7) was repealed effective January 1, 2019 as a result of the Making Ontario Open for Business Act, 2018. This provision is no longer in force. The discussion of this provision is being maintained for use in situations that arose when it was in force.
Subsection 42.1(8) was repealed effective January 1, 2019 as a result of the Making Ontario Open for Business Act, 2018. This provision is no longer in force. The discussion of this provision is being maintained for use in situations that arose when it was in force.
These provisions, read together, provide that if a collective agreement that that is in effect on April 1, 2018 contains a provision that permits differences in the rate of pay based on employment status, the provision of the collective agreement will prevail even if it conflicts with the ESA. However, the conflicting provisions will cease to prevail on the earlier of the date the collective agreement expires or January 1, 2020.
Section 42.2 of the Employment Standards Act, 2000 was repealed effective January 1, 2019 as a result of the Making Ontario Open for Business Act, 2018. This section is therefore no longer in force. However, employees may still have a complaint relating to section 42.2 that arose during the period of time when the section was in force: from April 1, 2018 to December 31, 2018. For that reason, the Program’s interpretation of this section remains as part of this publication, though the text appears in red to highlight that the relevant provisions have been repealed.
Subsection 42.2(1) was repealed effective January 1, 2019 as a result of the Making Ontario Open for Business Act, 2018. This provision is no longer in force. The discussion of this provision is being maintained for use in situations that arose when it was in force.
Section 42.2 was added to the Employment Standards Act, 2000 (ESA) as a result of the Fair Workplaces, Better Jobs Act, 2017; it came into effect on April 1, 2018. It was repealed effective January 1, 2019 by the Making Ontario Open for Business Act, 2018.
This section prohibits a temporary help agency from paying an assignment employee a lower rate of pay than that paid to an employee of the client, where the employees perform “equal work” as established in clauses (a) through (c). This requirement is subject to the exception set out in s. 42.2(2) of the ESA.
Section 42.2 addresses a difference in the rate of pay between an assignment employee and an employee of a client.
ESA Part I, s. 1 defines assignment employee, temporary help agency, and client as follows:
See ESA Part I, s. 1 for a discussion of these definitions.
For this provision to apply, the comparison of work performed must be between an assignment employee and an employee of a client. An assignment employee cannot be paid a lower rate of pay than a client employee, where the two perform “equal work”. The work being compared is work that is being performed by the two employees contemporaneously.
(Note that subject to certain exceptions, s. 42(1) and 42.1(1) prohibit employers from paying employees different rates of pay for “equal work” due to a difference in sex or in employment status. The comparisons under sections 42 and 42.1 are not between an assignment employee and a client employee; in those contexts, an assignment employee would compare himself or herself to another assignment employee employed by the same temporary help agency.)
For this provision to apply, there must be a difference in the rate of pay between the assignment employee and the employee of the client who perform “equal work”.
“Rate of pay” is not defined in the legislation.
It is Program policy that, for the purposes of Part XII, rate of pay generally includes:
It is Program policy that, for the purposes of Part XII, rate of pay generally does not include:
There may be other forms of remuneration that could be captured under “rate of pay”, that are not addressed in the list above. For example, there may be situations where certain bonus structures would properly fall under “rate of pay”, whereas other bonus structures would not. In assessing whether particular remuneration contributes to an employee’s “rate of pay”, an employment standards officer will consider all relevant factors, including the specifics of the compensation system, its purpose, and the legislative intent behind Part XII.
When determining whether there is a difference in the rate of pay between employees earning commissions, or employees who are subject to piece work rates, an employment standards officer will compare the rates applicable to both employees. For example, if an assignment employee and an employee of the client both earn minimum wage plus 15% commission on all sales, the two individuals will be considered to be paid the same rate of pay even if one takes home a greater dollar amount because that employee made more sales. A similar approach will be taken with respect to overtime. As long as the assignment employee and the client employee are subject to the same overtime rate and overtime threshold, there would not be a difference in the rate of overtime pay between the two. One person may earn more overtime pay than another because they work more hours, but this would not mean that there is a difference in the overtime rate between them.
One question that might arise is how to conduct a comparison in “rate of pay” between an assignment employee and a client employee who do “equal work” but who are paid pursuant to different compensation schemes. Comparing a set hourly rate or yearly salary to earnings that may fluctuate based on employee performance, such as commission or piece work, is not a viable assessment. It is Program policy that, generally, comparisons can only be made between two employees with the same remuneration scheme - in other words, only by comparing “apples to apples”. For example, if an assignment employee earns $24 an hour, an employment standards officer will not compare her rate of pay with that of a client employee who earns $18 an hour plus a commission rate. One exception, however, is the comparison between employees earning an hourly, weekly, or monthly rate, or a yearly salary; the comparison becomes “apples to apples” once it is established what each employee earns as an hourly rate and thus a direct comparison is possible. Similarly, an “apples to apples” comparison is possible where two employees, for example, both earn $25 per hour but one of the two also earns a 10% commission on sales. In this case, though there are different remuneration schemes, a direct comparison is possible because the employees earn exactly the same rate in one element of the remuneration scheme. In this example, the obvious outcome is that the rates of pay are not the same.
For this provision to apply, the assignment employee and employee of the client who are being compared must perform “equal work”. The elements that make up “equal work” are established in clauses 42.2(a) through (c). In order for work to be considered equal, all of the following must be present:
Each of these elements is examined individually in the analysis below.
The assignment employee and client employee being compared must perform substantially the same kind of work. The Fair Workplaces Better Jobs Act, 2017 introduced a definition to Part XII of the ESA 2000 that took effect on April 1, 2018. Section 41.2 defines “substantially the same” to mean substantially the same but not necessarily identical.
In other words, jobs do not have to be identical for this standard to apply. "Substantially the same kind of work" refers to the main characteristics or the core duties of the work. Jobs do not have to be identical for this standard to apply. Minor differences in job content do not, in and of themselves, make the section inapplicable.
When considering whether the kind of work is “substantially the same”, the work to be compared is work that is being performing contemporaneously. The comparison is to be made on the basis of the actual work the employees perform, not the terms of hiring, or the job descriptions.
An officer must look at the jobs as a whole and consider all information that is relevant in the particular circumstances. There are a number of different possible scenarios where a finding of substantially the same kind of work may be made.
For example, where two employees perform identical tasks 90% of the time and different tasks only 10% of the time, an officer may conclude that they perform substantially the same kind of work – i.e. the time spent on different tasks is not so extensive as to support a finding that the overall kind of work being performed is not substantially the same.
Similarly, a finding that substantially the same kind of work is being performed may be made where 90% of the employees' time is spent performing tasks that, although not identical, are so alike as to warrant that finding even though 10% of their time is spent on tasks that are different. Note that in the context of these provisions, it is the work itself that is being compared, not the value of the work (as is the case in the pay equity context).
The examples above are provided as illustrations of possible scenarios where a finding of substantially the same kind of work may be made. They are not intended to be an exhaustive list of such scenarios or to suggest that, as a threshold, 90% of the employees’ time must be spent on work that is identical or so alike before a finding that substantially the same kind of work is being performed can be made. Rather, the examples are provided as a point of reference only and are meant to assist in achieving general consistency in the interpretation of this provision. The examples do not establish a “rule” or a “test” and they should not be applied in a formulaic way without consideration of all relevant information. There may be situations where a higher or lower percentage of time may be spent on tasks that are identical or so alike, such that a finding that substantially the same kind of work is being performed is appropriate.
The term "establishment" is defined in s. 1 of the ESA 2000 as follows:
"Establishment" means a location where the employer carries on business. However, two or more locations of the employer will be considered a single establishment if:
See ESA Part I, s. 1 of the Manual for further information regarding the definition of establishment.
Per s. 42.2(1)(b), the performance of the work must require substantially the same skill, effort and responsibility. These are three separate requirements, each of which must be met in order for s. 42.2 to apply.
The Fair Workplaces Better Jobs Act, 2017 introduced a definition in Part XII of the ESA 2000 that took effect on April 1, 2018. Section 41.2 defines “substantially the same” to mean substantially the same but not necessarily identical.
This clarifies that the skill, effort and responsibilities do not need to be exactly the same or identical in every respect to be considered substantially the same. Minor or inconsequential differences do not render the standard inapplicable.
The requirement for skill, effort and responsibility are applied to the actual work that the employees perform, and not their terms of hiring, job description or job title. The work that is to be compared is work that the employees are performing contemporaneously. The jobs must be evaluated as a whole.
The fact that there are some differences in tasks between two jobs would not be a sufficient reason, in and of itself, to establish that the jobs do not require the same skill, effort or responsibility.
(i) Performance requires substantially the same skill
Skill refers to the degree or amount of knowledge or physical or motor capability needed to perform the job. It includes factors such as education, manual dexterity, experience and training, and is measured in terms of performance requirements.
(ii) Performance requires substantially the same effort
Effort is the physical or mental exertion needed to perform a job. An example of physical effort is the amount of strength a labourer needs to lift packed boxes. An example of mental effort is the amount of thinking and concentration required by a bookkeeper to balance the books.
When determining whether the performance of the work requires substantially the same effort, the evaluation is based on the effort required for the work itself, and not on the effort expended by a particular individual. For example, where two employees lift 50 pound boxes, it is irrelevant that one employee finds the task to be very physically demanding while the other employee finds the same task to be quite effortless. However, it would take substantially more effort for an employee to lift 80 pound boxes as compared to an employee who lifts boxes that weigh only 10 pounds. As a result, where two jobs have different weight lifting requirements (e.g. 80 pounds versus 10 pounds), they may not satisfy the requirement that the work require substantially the same amount of effort.
The sporadic performance of an activity that may require extra physical or mental effort does not suffice to establish that the jobs require substantially different levels of effort.
(iii) Performance requires substantially the same responsibility
Responsibility is measured by the number and nature of an employee’s job obligations, the degree of accountability and the degree of authority exercised by an employee in the performance of the job. Some factors to consider include:
For example, an employee who always performs assigned tasks and duties in accordance with specific, detailed instructions would not have substantially the same degree of responsibility as an employee who works only from general policy objectives and refers to superiors on an infrequent basis only, when interpretations of organizational policy are in question.
As another example, where one employee is responsible for collecting and providing the money from individual cash registers to the accounting department, that employee would likely have more responsibility than an employee who does not handle any cash, or who handles cash only rarely in the performance of his or her job.
The working conditions between the two jobs being compared must be “similar”. (Note this is a lower threshold than “substantially the same” as defined in s. 41.2 and applied in in the “substantially the same kind of work” and “substantially the same skill, effort and responsibility” parts of the test).
"Working conditions" generally refer to factors such as:
For example, appliance repairers who spend all their time on the employer’s premises do not have similar working conditions to appliance repairers who do their work attending at customers’ homes.
Subsection 42.2(2) was repealed effective January 1, 2019 as a result of the Making Ontario Open for Business Act, 2018. This provision is no longer in force. The discussion of this provision is being maintained for use in situations that arose when it was in force.
The prohibition against paying different rates of pay to an assignment employee and an employee of the client who perform “equal work”, per s. 42.2(1) does not apply if the difference in the rate of pay is made on the basis of any other factor other than sex, employment status or assignment employee status.
The broad scope of this exception acknowledges the myriad of factors other than sex, employment status or assignment employee status that come into play when pay rates are determined. In practice, this exception allows for a differentiation in rate of pay based on a wide variety of factors, including those that are subjective. Note, however, that the factor (or factors) that the employer provides as the reason(s) for the pay differential must be the actual reason(s). Employment standards officers will review and assess the credibility of any available evidence (which may in some cases be limited to the employer’s assertions) in order to satisfy him or herself that the reason(s) provided are in fact the actual reason(s) for the pay differential. Note that it is possible for a “factor” used to support a difference in the rate of pay to fit within the s. 42.2(2) exception, but to be prohibited by legislation that is not administered by the Ministry of Labour, such as the Ontario Human Rights Code.
The key determination to be made in applying this provision is whether the “factor” used to support the difference in rate of pay is sex, employment status, or assignment employee status. If it is, this exception does not apply. If the factor is anything other than sex or employment status, this exception generally does apply.
When determining whether the difference in rate of pay is based on “sex”, the question to be answered is whether the employee is earning a particular rate of pay because he is male or she is female.
When determining whether the difference in rate of pay is based on “employment status”, the question to be answered is whether the employee is earning a particular rate of pay because of the number of hours he or she regularly works or because of the term of his or her employment (such as permanent, temporary, seasonal, or casual).
When determining whether the difference in rate of pay is based on “assignment employment status”, the question to be answered is whether the employee is earning a particular rate of pay because she or he is an assignment employee.
If the answer to any of these questions is yes, then the exception does not apply and equal pay is required per subsection 42.2(1).
Some examples of factors that the Program generally considers to fall under “any other factor other than sex, employment status or assignment employee status” include:
Where one of the two employees being compared is covered by a collective agreement: the Program considers a difference in rate of pay that arises out of the collective bargaining process to be a “factor other than sex or employment status” such that the requirement for equal pay would not apply. For practical purposes, this means that a non-unionized assignment employee and a unionized employee of the client can receive different rates of pay for performing “equal work”.
This policy does not apply where the assignment employee and client employee being compared are covered by the same collective agreement. Note, however, that in this situation, differences in rate of pay might be substantiated under other exceptions.
(Note that where a seniority system at a client business is established through a collective agreement, the discussion under the heading “Coverage Under a Collective Agreement” is applicable.)
In many workplaces that use assignment employees, those assignment employees are not subject to, or covered by, the client employers’ systems that establish client employees’ eligibility for wage increases.
A difference in rate of pay between an employee of a client and an assignment employee resulting from a seniority system established by the client (outside of a collective agreement) in which its employees’ compensation is based solely on a “mechanical” fact-based measurement (for example, length of service or accumulated number of hours of work), and in which increases in rate or pay happen automatically or “mechanically” without any normative assessment/evaluation by the employer, will generally be considered to fall within the exception. As such, a difference in rate of pay would be substantiated where, pursuant to such a system, the client employee has a greater length of service or more accumulated hours than the assignment employee.
For example:
A client employer’s employees progress through a wage grid based solely on their length of employment. Employees start at $18 per hour and automatically receive an $1 per hour increase after six months of employment.
Client Employee A started January 1, 2018 at $18 per hour and received a $1 per hour increase after six months of employment, on July 1, 2018.
Assignment Employees B and C perform “equal work” to Client Employee A. Assignment employees B and C are both paid $18 per hour. B has been on assignment in the workplace for seven months. C has been on assignment in the workplace for two months.
The difference in the rate of pay between Client Employee A and Assignment Employee B is not considered to fall within the exception. In this situation, the assignment employee is being paid a lower rate because the seniority system does not apply to him or her by virtue of the agency, and not the client, being his or her employer. Subsection 42.2(2) provides that an exception to the equal pay requirement cannot be based on the fact that the assignment employee is an assignment employee.
The difference in the rate of pay between Client Employee A and Assignment Employee C is considered to fall within the exception of “any other factor other than sex, employment status or assignment employee status”; here the difference in rate of pay is consistent with the established wage grid that determines employees’ compensation pursuant to their length of employment and that awards a $1 per hour increase after six months of employment, which Assignment Employee B has not yet completed. Accordingly, there would be no contravention.
For practical purposes, this means that where the client employer applies a purely mechanical, fact-based system to determine eligibility for wage increases, assignment employees who are doing “equal work” to client employees must be notionally treated as if that system applies to them for the purpose of determining if the exception applies.
Where the client’s system for determining pay rate increases for its employees is not based purely on a mechanical, fact-based measurement and instead includes a subjective performance appraisal or a normative assessment of some sort, the Program will generally consider the system to fall within the exception. In practice, this means that assignment employees who are doing “equal work” to client employees do not have to be notionally treated as if such systems apply to them for the purpose of determining their rate of pay. This is due to the nature of the relationship between assignment employees and client businesses: generally, it is not reasonable to require client businesses to conduct subjective performance appraisals/normative assessments on assignment employees. For a more detailed discussion on systems involving such evaluations, please see the heading “An Established Merit System at the Client Business”.
Where a client does not have an established seniority system, a “seniority-like” factor may be a “factor other than sex, employment status or assignment employee status”, such that the requirement for equal pay would not apply. For example, a longer-term employee of the client may earn a greater rate of pay than that given to a newly placed assignment employee.
(Note that where a merit system at a client business is established through a collective agreement, the discussion under the heading “Coverage Under a Collective Agreement” is applicable.)
In many workplaces that use assignment employees, those assignment employees are not subject to, or covered by, the client employers’ systems that establish employees’ eligibility for wage increases.
A difference in pay rate may result from a merit system established by the client employer in which its employees’ compensation is at least partially based on their achievements and/or how well they perform their jobs.
If a client employer has a merit system in place that is established outside of a collective agreement, whereby the client formally evaluates employees’ performance and that normative evaluation determines, at least in part, their pay rate, then this would generally be considered “any other factor other than sex, employment status or assignment employee status” such that the requirement for equal pay would not apply.
Since an assignment employee is not an employee of the client business, it generally cannot be expected that the assignment employee would be subject to a formal performance review by the client. It would also be completely impractical for the temporary help agency to attempt to review the assignment employee’s performance pursuant to the client’s evaluation criteria since the agency does not have a presence in the client’s workplace, meaning it would not have the necessary information or opportunity to observe performance on which to base an evaluation. So, due to the nature of the working relationship and the impracticalities of the agency applying the client’s evaluation criteria, it is the Program’s position that such a performance review cannot be required and the client’s merit system therefore cannot be applied to an assignment employee.
For practical purposes, this means that assignment employees who are doing “equal work” to the client employees do not have to be treated as if that system “notionally” applies to them for the purpose of the determination of their rate of pay.
(Note that where a system that measures earnings by quanity or quality of production is established through a collective agreement, the discussion under the heading “Coverage Under a Collective Agreement” is applicable.)
In many workplaces that use assignment employees, those assignment employees are not subject to, or covered by, the client employers’ systems that establish employees’ eligibility for wage increases.
A difference in rate of pay between an employee of a client and an assignment employee resulting from a system established by the client (outside of a collective agreement), that measures earnings by quanity or quality of production, in which its employees’ compensation is based solely on a mechanical fact-based measurement (for example, the number of widgets completed or the quality of completed widgets), and in which increases in rate or pay happen automatically or “mechanically” without any normative assessment/evaluation by the employer, will generally be considered to fall within the exception. For example, a difference in rate of pay would be substantiated where, pursuant to such a system, the client employee has produced a greater number or more quality widgets than the assignment employee.
A client employer operates a widget factory and employs manufacturing employees. All employees receive $1 per completed widget, and receive a pay increase of 15 cents per widget after they complete 1,000 widgets. If the same compensation system is applied to the assignment employee who enters the workplace, the fact that the client employee earns $1.15 per widget (based on the fact that she has already completed 1000 widgets) while the assignment employee earns only $1.00 per widget (because she has not yet completed 1,000 widgets) would be an exception to per s. 42.2(2). However, note that in order for this exception to apply, the assignment employee must also be paid $1.15 per widget once he or she has completed 1,000 widgets.
A client employer operates a widget factory and employs manufacturing employees. All employees receive $1 per completed widget, and receive a pay increase of 15 cents per widget after the first 1,000 of their completed widgets meet a “mechanical”/objective quality test. If the same compensation system is applied to the assignment employee who enters the workplace, the fact that the client employee earns $1.15 per widget (based on the fact that she has already achieved the threshold of 1,000 quality widgets) while the assignment employee earns only $1.00 per widget (because she has not yet achieved the quality threshold) would be an exception to per s. 42.2(2). However, note that in order for the exception to apply, the assignment employee must also earn $1.15 per widget once he or she completes 1,000 widgets that meet the quality test.
But, Where the client’s system for determining pay rate increases for its employee is not based purely on a mechanical, fact-based measurement and instead includes a subjective performance appraisal or a normative assessment of some sort, that system will generally be considered to fall within the exception.
In practice, this means that where the client employer’s system involves a normative assessment of some sort, the assignment employees who are doing “equal work” to the client employees do not have to be notionally treated as though that system applies to them for the purpose of determining their rate of pay. This is due to the nature of the relationship between assignment employees and client businesses: it is generally not reasonable to require client businesses to conduct normative assessments on assignment employees. For a more detailed discussion on systems involving involving such evaluations, please see the heading “An Established Merit System at the Client Business”.
Even where the work is “equal”, a difference in relevant experience or educational achievement may be a “factor other than sex or employment status”, such that the requirement for equal pay would not apply.
Some employers engage in the practice of “red circling”. This means they maintain an employee’s rate of pay, even after transferring the employee to a job that normally pays a lower rate. An example of this is an employee transferred to a lower paying job due to a company reorganization. Under a pure "red-circling" system, the higher-paid employee would remain at the present rate of pay until the lower paid employees catch up.
If a client employee has been “red circled”, and thus earns a higher rate than what someone normally performing that work would earn, this would generally be considered to be a “factor other than sex, employment status or assignment employee status”, meaning that the requirement for equal pay would not apply.
The nature of the job market at a particular point in time may require an employer to offer a higher rate of pay to attract an employee to fill a particular role in its organization if the supply of qualified candidates is low. If a client employee was hired at a higher rate of pay for this reason, this is generally considered to be a “factor other than sex, employment status or assignement employee status”, meaning that the requirement for equal pay would not apply.
In some cases, a difference in the shifts that are being worked by an assignment employee and an employee of the client may mean that “equal work” is not being performed (e.g. a security guard on the day shift and a security guard on the night shift who have very different duties, level of responsibility and working conditions).
In certain situations, despite work between two employees on different shifts being “equal” per s. 42.2(1), the employer may pay a wage premium. This may be, for example, to compensate employees who work the evening shift for the inconvenience of working at that time. This rationale for providing a wage premium is considered to be a “factor other than sex or employment status”, meaning that the requirement for equal pay would not apply.
An employer may pay an employee a higher rate of pay based on a factor such as the employee being well liked by key clients, being particularly friendly or because that employee is seen as always “going the extra mile”. Examples such as these, even though they may be based on the subjective opinion of the employer, constitute a “factor other than sex or employment status” meaning the requirement for equal pay would not apply.
Subsection 42.2(3) was repealed effective January 1, 2019 as a result of the Making Ontario Open for Business Act, 2018. This provision is no longer in force. The discussion of this provision is being maintained for use in situations that arose when it was in force.
Section 42.2(3) prohibits a client of a temporary help agency from reducing an employee’s rate of pay in order to help a temporary help agency comply with s. 42.2(1). This means that where there is a difference in the rate of pay in contravention of section 42.2, the client cannot lower its higher-paid employee’s rate of pay to assist the temporary help agency in complying with its obligation under 42.2(1).
For example, an assignment employee and a client employee both work as administrative assistants performing equal work and none of the exceptions in s. 42.2(2) apply The assignment employee earns $15.00 per hour. The client employee earns $18.00 per hour. The client is prohibited from reducing its employee’s pay to $15.00 in order to assist the temporary help agency in meetings its obligations under s. 42.2(1).
Subsection 42.2(4) was repealed effective January 1, 2019 as a result of the Making Ontario Open for Business Act, 2018. This provision is no longer in force. The discussion of this provision is being maintained for use in situations that arose when it was in force.
This section reinforces s. 5(1) of the Act, which states:
A trade union or other organization is prohibited from causing or attempting to cause a temporary help agency to pay an assignment employee a lower rate of pay than that paid to an employee of the client, where they perform “equal work”.
Subsection 42.2(5) was repealed effective January 1, 2019 as a result of the Making Ontario Open for Business Act, 2018. This provision is no longer in force. The discussion of this provision is being maintained for use in situations that arose when it was in force.
This section permits an employment standards officer to determine the amount owed to an assignment employee as a result of the contravention of s. 42.2(1), and deems that amount owing to be unpaid wages. An employment standards officer may consequently issue an order to pay wages under ESA Part XXII, s. 103 against a temporary help agency. This order may include the amount necessary to correct the inequality in the rate of pay and may also include amounts owing under other standards that were calculated in the relevant period using the rate of pay that was found to violate s. 42.2. This may include, for example, vacation pay, public holiday pay, overtime pay, termination pay, etc.
Note that a director order to pay cannot be issued in relation to these deemed wages per s. 81(3).
Section 74.18 imposes joint and several liability on temporary help agencies and the clients of temporary help agencies for certain unpaid wages owed in respect of a pay period where the assignment employee was assigned to perform work for the client. Per s. 74.18(3), the wages to which joint and several liability apply are limited to regular wages, overtime pay, public holiday pay and premium pay that was earned during the relevant pay period.
Section 74.18 applies in the context of wages deemed to be owing as a result of a contravention of s. 42.2(1). Please see the discussion at section 74.18 for more information.
Subsection 42.2(6) was repealed effective January 1, 2019 as a result of the Making Ontario Open for Business Act, 2018. This provision is no longer in force. The discussion of this provision is being maintained for use in situations that arose when it was in force.
This subsection provides that assignment employees who believe that the temporary help agency is not complying with s. 42.2(1) may ask the agency to review their rate of pay. In response, the temporary help agency must review the assignment employee’s rate of pay and either adjust upwards it to address the contravention, or provide a written response that sets out the reasons why it disagrees with the assignment employee’s belief that there is a contravention.
The requirement that the employer’s response be in writing is satisfied if the response is provided to the employee on paper (for example, in a printed letter) or electronically.
Section 42.12(6)(b) does not specify a timeline within which the temporary help agency must provide the written response. It is Program policy that the response must be provided within a reasonable timeframe; what is reasonable will depend on the particular circumstances.
Note that this section does not require an assignment employee to request a review of their rate of pay as a prerequisite to filing a claim under ESA Part XXII, s. 96(1). In other words, an employee who believes their rate of pay does not comply with s. 42.2(1) may file a claim without ever requesting a review of their rate of pay from the agency.
The requirement in this subsection to adjust the assignment employee’s pay rate applies prospectively only; it does not require the temporary help agency to retroactively pay the employee what they would have earned had they received equal pay prior to the adjustment. However, an assignment employee may file a claim in order to recover any amounts owing prior to the adjustment (subject to the limitations on recovery set out in section 111).
Subsection 42.2(7) was repealed effective January 1, 2019 as a result of the Making Ontario Open for Business Act, 2018. This provision is no longer in force. The discussion of this provision is being maintained for use in situations that arose when it was in force.
Subsection 42.2(8) was repealed effective January 1, 2019 as a result of the Making Ontario Open for Business Act, 2018. This provision is no longer in force. The discussion of this provision is being maintained for use in situations that arose when it was in force.
These provisions, read together, provide that if a collective agreement that that is in effect on April 1, 2018 contains a provision that permits differences in the rate of pay between employees of a client and an assignment employee, the provision of the collective agreement will prevail even if it conflicts with the ESA. However, the conflicting provisions will cease to prevail on the the earlier of the date the collective agreement expires or January 1, 2020.
Part XIII of the Employment Standards Act, 2000 is intended to prohibit age, sex and marital status discrimination in respect of: employees, beneficiaries of employees, survivors of employees and dependents of employees in employee benefit plans, except in certain specific instances as set out in O Reg 286/01.
This definition is substantially the same as the definition in s. 1 of O Reg 321 under the former Employment Standards Act.
The definition of employer in s. 43 is supplementary to the definition of "employer" in s. 1 of the Employment Standards Act, 2000. For the purposes of Part XIII, the definition in s. 43 also includes a group or association of unaffiliated employers that have combined for the purpose of providing a pension plan, a life insurance plan, a disability insurance plan, a disability benefit plan, a health insurance plan or a health benefit plan to the employers' employees. This practice is common, for example, in the construction industry.
Section 44(1) prohibits the employer from providing a benefit plan that differentiates between the employees (or their beneficiaries, survivors or dependants) on the basis of the age, sex or marital status of employees except as allowed in O Reg 286/01. The prohibition in this section applies to any employer or person acting directly on behalf of an employer. A "person acting directly on behalf of an employer" includes persons empowered to act on behalf of the employer such as agents.
It is important to note that differentiations in benefit plans based upon bona fide job classifications or length of service requirements may be violations of s. 44(1) if such differentiations affect persons because of the age, sex or marital status of an employee and if it would not be an undue hardship to the employer to remove the discriminatory provision. In other words, intent to discriminate is not necessary for a violation of s. 44(1) to occur. In this regard, see the Supreme Court of Canada decision in Ontario Human Rights Commission v Simpsons-Sears, [1985] 2 SCR 536, 1985 CanLII 18 (SCC) where an employer was found to have committed a breach of human rights legislation on the basis that a rule that it had imposed, while not intentionally discriminatory, had a discriminatory effect and its elimination would not cause "undue hardship" to the employer. In the employment standards context, for example, if all of an employer’s part-time employees are female, and part-time employees are excluded from a benefit plan, the reasoning in Ontario Human Rights Commission v Simpsons-Sears may require that the exclusion of part-time employees be eliminated.
Section 44(1) prohibits discrimination with respect to certain benefit plans on the basis of age, sex and marital status. The terms "age," "sex" and "marital status" are all defined in section 1 of O Reg 286/01 (although only for purposes of Part XIII and O Reg 286/01). For further discussion of these terms, please refer O Reg 286/01.
"Age" is defined in s. 1 of O Reg 286/01 as follows:
Therefore, if a plan discriminates against employees who are under 18, or 65 or over, it will not constitute discrimination on the basis of age within the meaning of Part XIII.
On December 12, 2006 amendments to the Human Rights Code, RSO 1990, c H.19 (the "Code") to eliminate, for most employees, mandatory retirement at age 65 or older, came into force. The definition of "age" in the Code which formerly excluded ages 65 and older, was amended to eliminate the upper limit, with the result that in general, discrimination against employees aged 65 or older is no longer permitted. However, the Code still provides (now in subsections 25(2.1) to 25(2.3)) that the right to equal treatment without discrimination on the basis of age is not infringed by benefit, pension, superannuation or group insurance plans or funds that comply with the ESA 2000 and its regulations. Subsection 25(2.3) specifically states that this is so even if the ESA 2000 or its regulations define "age" differently than the definition in the Code. As a result, discrimination on the basis of employee ages of 65 or over is permitted in benefit plans under the ESA 2000 because O Reg 286/01 defines age as any age 18 years or more and less than 65 years. In Chatham-Kent (Municipality) v Ontario Nurses Association (O’Brian) (Re) (2010), 202 LAC (4th) 1 (Etherington), the arbitrator was asked to determine whether these provisions violated s. 15(1) of the Charter of Rights and Freedoms (the "Charter") because they discriminate on the basis of age. Although the arbitrator concluded that they did indeed violate s. 15(1) of the Charter, he went on to find that they were saved by s. 1 of the Charter which states that rights otherwise protected under s. 15 are subject to "reasonable limits prescribed by law as can be demonstrably justified in a free and democratic society".
"Sex" is defined to include distinctions between employees because the employee "is or is not a head of household, principal or primary wage earner or other similar condition," and "a distinction between employees . . . because of the pregnancy of a female employee."
At one time, a distinction based on pregnancy was not generally considered sex discrimination. For example, in Bliss v Attorney General of Canada, [1979] 1 SCR 183, 1978 CanLII 25 (SCC), the Supreme Court of Canada held that unemployment insurance legislation providing special conditions for pregnant women did not constitute discrimination on the grounds of sex. As a result, the definition of "sex" in the predecessor to O Reg 286/01 was amended so as specifically to include a distinction based on pregnancy. The Bliss v Attorney General of Canada view was later overturned on the question of whether discriminatory treatment based on pregnancy constitutes discrimination on the basis of sex by the Supreme Court in Brooks v Canada Safeway Ltd., [1989] 1 SCR 1219, 1989 CanLII 96 (SCC).
"Marital status" is defined in s. 1 of O Reg 286/01 as follows:
Under this inclusive definition, married employees (including employees married to a person of the same sex), unmarried employees supporting a dependent child or children, as defined in the plan, and employees with "common law" spouses will all be considered to have marital status. After the decision in Halpern v Canada (Attorney General), 2003 CanLII 26403 (ON CA), in which the Court of Appeal ruled that the exclusion of same sex couples from marriage was inconsistent with the equality guarantees in the Canadian Charter of Rights and Freedoms, was not saved under section 1 of the Charter ("reasonable limits") and was, therefore, unconstitutional, the Program took the view that "common law status as defined in the relevant benefit plan" must include same-sex as well as opposite-sex common law couples. (See also the discussion of the definition "spouse" in O Reg 286/01, s.1 in the Manual.) On June 13, 2005, clause (b) of the definition of "marital status" was amended so as to eliminate the words "of husband and wife", thereby reflecting Halpern v Canada (Attorney General) and the Program position. Any exemption from s. 44(1) in O Reg 286/01 for differentiations on the basis of marital status must be applied equally to all employees with marital status. Likewise, if there is no exemption in the regulation, then all persons with marital status (including employees married to or in a common-law relationship with a person of the same sex and including single employees with supporting a dependent child or children) must be treated equally.
Part XIII and the prohibition against discrimination in s. 44 can apply to any type of benefit plan offered by an employer as defined in subsection 1(1) of the Act; benefit plans include those listed in s. 43 as well benefit plans such as supplementary unemployment benefits ("SUBS"), whether payable during periods of lay-off or as "top ups" for maternity and parental benefits, as well as deferred profit sharing plans. A deferred profit sharing plan need not be registered under the Income Tax Act, RSC 1985, c 1 (5th Supp) in order to be considered a benefit plan within the meaning of s. 44(1).
Note, however, that the definition of "employer" in s. 43, in addition to including employers as defined in subsection 1(1) of the Act, also includes a group of employers or an association acting for an employer in relation to certain types of benefit plans listed within s. 43. Thus, while the prohibition against discrimination in s. 44 applies in respect of any type of benefit plan provided, ordered or arranged for by an employer or person acting on behalf of an employer, the prohibition would apply in respect of a benefit plan offered by a group or association of employers only if it is a pension plan, life insurance plan or health benefit plan.
The use of the words "provide, offer or arrange" indicate that a plan will be covered by Part XIII whether or not employees are required to participate in it or make contributions to it. Thus, Part XIII will cover, among other plans, voluntary, "employee-pay-all" plans provided by an employer.
Section 44(1) applies to benefit plans without any distinction as to how the benefits are payable. For example, s. 44(1) may apply whether the benefits are payable periodically or as a lump sum. In addition a benefit plan described in s. 43 may be subject to the prohibition against discrimination in s. 44(1) even if there is no specific fund set up to provide the benefits. For example, "self-insured" company benefit plans, where the company pays for the benefits itself, rather than paying premiums to an insurance company, will be covered by Part XIII, even though the company has not set up a special segregated fund from which to pay these benefits. Part XIII would not cover an informal, "self-insured" pattern of responses such as where occasional days off with pay are provided on an ad hoc basis. However, once such a plan becomes formalized, i.e., using fixed criteria respecting who is eligible for benefits, it would come under Part XIII.
Section 44(1) protects employees and their beneficiaries, survivors and dependants from discrimination under a benefit plan on the grounds of age, sex or marital status of the employees.
"Dependant" is the only one of these classes of persons defined in s. 1 of O Reg 286/01. It is defined as follows:
For further discussion of the term "dependant", please refer to O Reg 286/01, s. 1.
This provision is substantially the same as s. 33(3) in the former Employment Standards Act. Section 44(2) prohibits an organization of employers or employees or a person acting on their behalf from causing or attempting to cause, in any way, an employer to contravene section 44(1), i.e., to discriminate in benefit plans on the basis of age, sex or marital status. For example, a union may be in violation of s. 44(1) if, during collective agreement negotiations, it seeks a benefit plan package that contains a provision contrary to s. 44(1).
The purpose of the leaves of absence provisions in Part XIV is to provide qualified employees with the right to take job protected leaves. The intent of each leave is discussed below.
The Employment Standards Amendment Act (Pregnancy & Parental Leave), 1990, SO 1990, c 26 amended the former Employment Standards Act with the intention of improving the rights and protections already afforded to pregnant employees, and to establish a leave for working parents. The provision of a parental leave generally allows parents to spend time with a newborn or newly adopted child and was also intended to enable employees to take advantage of the new parental benefit under the former federal Unemployment Insurance Act, RSC 1985, c U-1, effective November 18, 1990 and repealed on July 1, 1996. Similarly, the longer parental leave provided by the ESA 2000 in December 2000 was intended to enable employees to take advantage of the extended parental benefits made available in December 2000 under the federal Employment Insurance Act, SC 1996, c 23. A further amendment to the ESA 2000 to support an extension in the time period over which parental EI benefits could be accessed was made effective December 3, 2017 with the Fair Workplaces, Better Jobs Act, 2017.
The 1990 amendments were drafted with the intention that qualified employees who availed themselves of the right to take pregnancy leave and parental leave would not be disadvantaged for doing so. As a result, employees on pregnancy or parental leave now have a right to be reinstated to the same position they held prior to going on leave. It is only if that position no longer exists that the employer can reinstate the employee to a comparable position. Under previous pregnancy leave provisions employers could, at their option, reinstate employees who took a leave to the employee's own position or to a comparable one. Employees are also to be reinstated at the greater of the wage rate they were earning prior to going on leave or the rate they would have been earning had they not taken the leave.
Employees are also entitled to continue to participate in certain benefit plans while on leave. The employer is required to continue paying the employer contributions and the employee continues to pay the employee portion of the premiums due unless the employee gives the employer written notice that they do not intend to pay the employee's contributions. In addition, seniority, length of service and length of employment continue to accrue while the employee is on leave.
The sick leave provisions provide employees who have been employed for at least two consecutive weeks with the right to take up to three days of unpaid leave from work each calendar year because of a personal illness, injury or medical emergency. The sick leave provisions came into force on January 1, 2019 as a result of an amendment to the ESA 2000 by the Making Ontario Open for Business Act, 2018.
The family responsibility leave provisions provide employees who have been employed for at least two consecutive weeks with the right to take up to three days of unpaid leave from work each calendar year because of the illness, injury, medical emergency or urgent matter of certain relatives. The family responsibility leave provisions came into force on January 1, 2019 as a result of an amendment to the ESA 2000 by the Making Ontario Open for Business Act, 2018.
The bereavement leave provisions provide employees who have been employed for at least two consecutive weeks with the right to take up to two days of unpaid leave from work each calendar year because of the death of certain relatives. The bereavement leave provisions came into force on January 1, 2019 as a result of an amendment to the ESA 2000 by the Making Ontario Open for Business Act, 2018.
The declared emergency leave provisions provide employees with the right to an unpaid leave of absence if the employee will not be performing the duties of the employee’s position because of an emergency declared by the Lieutenant Governor in Council or the Premier and if one of certain other eligibility criteria is met.
The infectious disease emergency leave provisions provide employees with the right to a leave of absence if the employee will not be performing the duties of the employee’s position because of certain specified reasons related to a designated infectious disease. The diseases that have been designated as infectious diseases are set out in O. Reg. 228/20. From April 19, 2021 to March 31, 2023, eligible employees are entitled to up to three paid days of infectious disease emergency leave in certain circumstances. Otherwise, the leave is unpaid. (Note that paid infectious disease emergency leave was initially available until September 25, 2021. It was extended to December 31, 2021, July 31, 2022 and then was further extended to March 31, 2023.)
The reservist leave provisions provide employees who are reservists and who have been employed for at least three consecutive months with the right to unpaid leave from work where the employee will not be performing the duties of the employee’s position because of a deployment to a Canadian Forces operations outside of Canada, a deployment to a Canadian Forces operation inside Canada that is or will be providing assistance in dealing with an emergency or with its aftermath, or because the employee is participating in Canadian Forces military skills training.
The family medical leave provisions are intended to provide employees with the right to take up to 28 weeks of unpaid leave from work to provide care or support to certain family members who have a serious medical condition and are at significant risk of dying within a period of 26 weeks without penalty. The provision of a family medical leave was also intended to enable employees to take advantage of compassionate care benefits made available under the federal Employment Insurance Act, effective January 4, 2004 and expanded from 6 to 26 weeks of benefits on January 3, 2016 (although the provisions giving qualified employees the right to family medical leave under the ESA 2000 did not come into force until June 29, 2004). O. Reg. 476/06, filed on October 6, 2006 expanded the list of persons in respect of whom the leave could be taken.
The family caregiver leave provisions are intended to provide employees with the right to take unpaid time off work to provide care or support to specified family members who have a serious medical condition, even if the family member is not at significant risk of death within a period of 26 weeks, which is a qualifying criterion for family medical leave. Employees are entitled to up to eight weeks of unpaid leave each year with respect to each specified family member.
The critical illness leave provisions are intended to provide employees who have been employed by their employer for at least six months with the right to take unpaid time off work to provide care or support to a critically ill minor child or adult who is a family member of the employee. Employees are generally entitled to up to 37 weeks of unpaid leave in relation to a minor child, and 17 weeks in relation to an adult, to be taken in a 52-week period (and may requalify for subsequent 37 or 17 weeks of leave in subsequent 52-week periods). The provision of this leave was also intended to enable employees to avail themselves of federal Employment Insurance benefits for providing care or support to a critically ill minor child or adult who is a family member of the employee.
The child death leave provisions are intended to provide employees who have been employed by their employer for at least six months with the right to take unpaid time off work if a child of the employee dies. The leave entitlement is up to 104 weeks of leave. It is required that the leave be taken in a single period. If an employee is charged with a crime in relation to the death of the child or if the child was a party to a crime in relation to their death, there is no entitlement.
The crime-related child disappearance leave provisions are intended to provide employees who have been employed by their employer for at least six months with the right to take unpaid time off work if a child of the employee disappears as a probable result of a crime. The leave entitlement is up to 104 weeks of leave. The leave must be taken in a single period. The provision of a crime-related child disappearance leave was also intended to enable employees to apply for a federal income support grant for parents of missing children that became available on January 1, 2013 and that requires that the parent be on leave or have been on leave from work.
The organ donor leave provisions are intended to provide employees who have been employed by their employer for at least 13 weeks and who undergo surgery for the purpose of donating all or part of certain organs to other persons, with the right to take up to 13 weeks of job-protected, unpaid leave from work. The leave may be extended for medical reasons for a further period of up to 13 weeks.
The domestic or sexual violence leave provisions are intended to provide employees who have been employed for at least 13 weeks with two separate allotments of 10 days and 15 weeks of leave within each calendar year if the employee or the employee’s child has experienced or been threatened with domestic or sexual violence. The leave must be taken for specific purposes: to seek medical attention, to access professional counselling, to relocate temporarily or permanently, to seek law enforcement and legal assistance, and to access victim services. The first five days of leave are to be paid; the balance of the leave taken within a calendar year is unpaid.
The Employment Standards Act, 2000 introduced new definitions of the terms “same-sex partner” and “spouse” in September 2001, at the same time the personal emergency leave provisions, which referenced those terms, were introduced. At the time, same-sex partner was defined to mean unmarried same-sex couples, and spouse was defined to mean unmarried or married opposite-sex couples. After the Ontario Court of Appeal decision in Halpern v Canada (Attorney General), 2003 CanLII 26403 (ON CA), in which the Court ruled that the exclusion of same-sex marriages from the common-law definition of marriage was unconstitutional, the Program read the definition of spouse as if it included married same-sex couples. On June 29, 2004, the Employment Standards Amendment Act (Family Medical Leave), 2004, SO 2004, c 15 amended the ESA 2000 to reflect the Halpern v Canada decision. It repealed the same-sex partner definition, removed references in the personal emergency leave context to same-sex partner, and amended the definition of the term spouse to mean married and unmarried couples of the same or opposite sex. The Spousal Relationships Statute Law Amendment Act, 2005, SO 2005, c 5, which came into force on March 9, 2005, made a subsequent amendment to the definition of spouse in the ESA 2000. This amendment incorporated the amended definition of spouse in s. 1 of the Family Law Act, RSO 1990 c F.3 which (also as a result of the Spousal Relationships Statute Law Amendment Act, 2005) now refers to either of two persons who are married to each other rather than to "either of a man and woman" who are married to each other.
The definition of parent is an inclusive one, which means that the term parent could include individuals not specifically mentioned in the definition.
The Program's view of who is and is not a parent for the purposes of Part XIV is set out below – this is not necessarily an exhaustive list:
It is the Program's position that all birth parents are parents.
This means, for example, that all birth parents who meet the other eligibility criteria are entitled to parental leave, including birth fathers who are not currently in a relationship with the mother of their child, and birth parents who put a child up for adoption. Such individuals could also be eligible for any other Part XIV leave that is available to employees with respect to the employee's child. For example, an employee may be eligible to take family medical leave to provide care or support to his child even if he is no longer in a relationship with the mother of the child, and even if the parent gave the child up for adoption.
It also means that a surrogate mother is a parent even if she may not be genetically related to the child, which may be the case, depending on the circumstances. Accordingly, a surrogate mother may be eligible for parental leave, and any other Part XIV leave that is available to employees with respect to the employee's child.
Correspondingly, children in circumstances described above will, as an employee, be eligible to take any Part XIV leave that is available to employees vis-a-vis their parent. For example, a child may be eligible to take family medical leave to provide care or support to the child's surrogate mother, or to the child's birth father who gave the child up for adoption.
The definition of parent specifically includes a person with whom a child is placed for adoption.
This means that adoptive parents will be considered to be a parent for parental leave purposes and any other Part XIV leave that is available to employees with respect to the employee's child. Correspondingly, the adopted child will, as an employee, be eligible to take any leave respecting their adoptive parent that is available to employees vis-a-vis a parent. For example, the child could be eligible to take family medical leave to provide care or support to the adoptive father.
The Program's position is that it is sufficient that the adoption proceedings have been commenced in order to demonstrate that the placement is for the purposes of adoption. It is not necessary that adoption proceedings have been finalized.
The definition of parent will not cover most foster parents, as their relationship to the child is usually based upon a short-term or interim arrangement. Accordingly, most foster parents are not eligible for parental leave, which is available only to parents. They may, however, be eligible for other leaves under Part XIV that are specifically made available to foster parents, for example, family responsibility leave, bereavement leave, critical illness leave, family medical leave, family caregiver leave, domestic or sexual violence leave, child death leave and crime-related child disappearance leave.
Note, however, that if a foster parent commences adoption proceedings, thereby demonstrating an intent to adopt rather than foster the child, they will be considered an adoptive parent and therefore fall within the definition of parent.
In addition, even though they have not commenced adoption proceedings, foster parents may be considered parents if they are participating in certain programs referred to as foster to adopt programs. In such cases, a child is placed with the foster parents for the purposes of adoption by the foster parent. Such programs allow a child to be placed for adoption even though the child is not legally adoptable and adoption proceedings cannot therefore be commenced. For example, the child may be placed prior to the natural parents having consented to the adoption or relinquishing their rights to the child. In those cases, the Program will consider them to be a parent from the date of the placement.
Note it will also be possible for a foster parent to enter a foster to adopt program sometime after the child was originally placed with them as a foster child. In that case, the foster parent would be considered a parent at the time they entered the program rather than the date of placement. In some cases, foster parents will commit to adopting the foster child in their care if the child cannot be returned to their birth parents or be placed with a family member. Generally, such a foster parent would become a parent only if they commenced adoption proceedings. However, as with foster to adopt programs, such a foster parent may be considered a parent although they are unable to commence adoption proceedings because the child is not yet legally adoptable. In those circumstances, the foster parent will be considered a parent from the date the foster parent intends to adopt the child and considers the placement to be a permanent one.
A person who is not a parent can become a legal guardian to a child by a court order or under a will. There are certain leaves under Part XIV that are specifically made available to legal guardians, for example, critical illness leave, family medical leave, child death leave, crime-related child disappearance leave, and domestic or sexual violence leave. Whether a legal guardian who is not a parent is eligible for leaves which apply only to parents such as parental leave would have to be determined on a case by case basis. Note that a legal guardian may be considered a parent through steps taken in adoption proceedings — see the discussion above for more information.
The definition of parent also specifically includes a person who is in a relationship of some permanence with a parent of a child and who intends to treat the child as their own. Such individuals will be considered to be a parent for parental leave purposes, and any other Part XIV leave that is available to employees with respect to the employee's child. Correspondingly, the child of such an individual will, if the child is an employee, be eligible to take any Part XIV leave that is available to employees vis-a-vis a parent.
In the Program's view, this part of the parent definition was intended to cover a person who is in a spousal-like relationship with someone who is the parent of a child, and who, although not being the birth parent or an adoptive parent of that child, intends to assume a parental role with respect to the child. The words "some permanence" connote a relationship that is not temporary or occasional.
Consider the following hypothetical example: Juan who was unattached when he was hired by his employer, meets Demetra who has a child (John) from a previous marriage and they begin dating. Six months later they pool their resources and move in together and shortly after that Juan requests a parental leave from his employer, saying that he needs time off work in order to bond with John.
The employer, who knows only that Juan's personnel file shows him as single with no dependants, is reluctant to grant the leave and contacts the Program to find out what his responsibilities are.
In this situation, there are two critical questions. The first is whether Juan and Demetra are in a relationship of some permanence. The second question is whether Juan intends to treat John as if John was his own child. Both of these questions are questions of fact, and it may well be that the only significant evidence available consists of statements from Juan himself. While the employer may point to the fact that Juan identified himself as single to the employer's human resources department when he was hired, that is easily explained by the fact that Juan and Demetra have only just moved in together.
Cases dealing with the meaning of this phrase under family law legislation need to be approached with a degree of caution, since the cases are usually concerned with support issues and for that reason may look to whether the relationship has been of sufficient duration to create a degree of economic dependence or inter-dependence between the parties. Nevertheless, the family law case law can be helpful. Significantly, in Abell v Casselman (1979), 1 FLRAC 449 (Ont Prov Ct) the Court held that the words "some permanence" connote a relationship that is not temporary or occasional.In Labbe v McCullough, 1979 CanLII 1204 (ON CJ)the parties had cohabited for only two periods of, respectively, four weeks and two weeks, and yet were found to be in a relationship of some permanence.
In the above example, although Juan and Demetra had been living together a relatively short time, it seems clear that the parties are committed and not just engaged in something temporary or occasional; thus, this part of the test would seem to have been met.
This aspect of the test looks to the intentions of the person vis-a-vis the child of their partner (i.e., a person with whom they are in a relationship of some permanence). Essentially it looks to whether the person's plans are to assume a parental role with respect to the child. Are they intending to assume a significant degree of responsibility for raising the child, including participation in the support, guidance education and discipline of the child, or will theirs be a "hands-off" approach in which such responsibility is left to the birth or adoptive parent? Here, Juan's perceived need to bond with John is suggestive of an individual who intends to assume a significant degree of responsibility, and in the absence of any evidence to the contrary, might be taken to indicate that this aspect of the test is also met.
A "step-parent" is considered by the Program to be an individual who is the spouse (within the meaning of the section 45 definition of spouse) of a child's parent.
Some step-parents will fall within the section 45 definition of parent and some will not. A step-parent will only be considered to be a parent if the step-parent adopts the child, or if the step-parent intends to treat the child as their own. If neither of those conditions are met, the step-parent will not be considered to be a parent.
Note that while only a parent is eligible to take parental leave, a step-parent is eligible to take other leaves under Part XIV, for example, an employee may take family responsibility leave, bereavement leave, family caregiver leave, child death leave, crime-related child disappearance leave, critical illness leave, domestic or sexual violence leave, or family medical leave to provide care or support to a step-child, even if they would not fall within the definition of parent in s. 45.
Because the definition is inclusive, the Part XIV definition of parent could include an individual who is neither a birth parent, nor an adoptive parent nor a person in a relationship of some permanence with a birth or adoptive parent who intends to treat the child of that parent as their own. However, the definition cannot be considered wide open, either. To fall within the definition if none of the categories of parent set out above apply, the position of the Program is that the person must have permanently assumed a parental-like role with respect to a child, even if they would not, strictly speaking, generally be considered to be a parent.
Consider the hypothetical example in which a young birth mother moves in with her own mother (the grandmother of the child), who plays a significant role with respect to caring for the child. One year later, the mother moved out of town, leaving the child with the grandmother, who now assumed complete responsibility for the child's care. After another six months, following a conversation in which the mother indicated she had no interest in having anything to do with the child, the grandmother applied to the courts for a permanent, legal custody order, which she obtained after a further five months.
While such a custody order cannot be equated with an adoption order, there seems to be little doubt on these facts that at the point of applying for a custody order, the grandmother has assumed a parental-like role with respect to her daughter's child, and would therefore be eligible for leaves that are available with respect to the employee's child.
The more difficult issue which is relevant for the purpose of determining the timing of a parental leave entitlement may be to determine at what point the child came into the grandmother's custody, care and control for the first time – the parental leave can begin no later than 52 weeks after the day the child comes into the grandmother's custody, care and control for the first time. During the first six months after the mother moved away, although the grandmother may have assumed a parental-like role, there is no evidence to suggest that she intended this to be permanent; in some ways, her situation is similar to that of a foster parent, providing care on a temporary basis. This obviously changed after a further six months, however, as the grandmother moved to secure the right to legal custody of the child and to divest her daughter of that right. This would seem to be the point at which the grandmother decided that she would permanently treat the child as her own, even though she did not actually get the custody order for another five months. Since this is the first point at which she has custody, care and control of the child, this is the relevant point for purposes of determining when the period for starting parental leave begins. See Employment Standards Act Part XIV, section 48(2) for a discussion regarding the window for commencing parental leave.
Although no definition of child appears in section 45, there are other definitions of child in Part XIV that apply to particular leaves, specifically, critical illness leave, crime-related child disappearance leave, child death leave, and domestic or sexual violence leave that do contain upper age limits and will therefore apply instead of the definition in section 45. Having regard to the different definitions of child, and the different purposes of the leaves, it is Program policy that:
A person is a spouse as defined in s. 45 if they are a spouse as defined in section 1 of the Family Law Act, RSORSO 1990, c F.3 (generally this means a person who is legally married to someone of the same or the opposite sex) or if they are living with someone of the same or opposite sex in a conjugal relationship outside marriage.
Section 1 of the Family Law Act defines spouse as:
This provision means that an employee is entitled to pregnancy leave if she would have been employed for a period of at least 13 weeks immediately preceding her due date had she worked until that date.
It is not necessary that the employee be actively working for all or any part of the 13-week qualifying period. For example, if the employee was hired just 13 weeks before her due date but became ill and was unable to work from the day after she started (or went on vacation or was laid-off during that 13 weeks), she will be entitled to the leave. This interpretation of s. 46(1) is reinforced by the fact that the right to commence the leave up to 17 weeks before the expected date of birth pursuant to s. 46(2) would be a nullity if the employee were required to actively be at work in the 13 weeks immediately preceding the expected date of birth. Another example is where, theoretically, an employee who is hired 13 weeks before her due date could begin her pregnancy leave immediately after being hired.
Section 8(2) of O Reg 288/01, which ties together periods of employment that are not more than 13 weeks apart, applies only to the Termination and Severance of Employment context. Therefore, where there has been a clear interruption in the employer-employee relationship during the 13-week qualifying period, the requirement in s. 46(1) will not be met. A clear quit or termination will break the length of employment.
For example, an employee's baby is due on February 19. On August 1 of the previous year, she was hired for a six-month contract that ends on February 1. On February 3 she is rehired as a permanent employee. Does she qualify for a pregnancy leave? In this example, she would not be entitled because there was a severing of the employment relationship on February 1 (when the contract ended) and a gap between that period of employment and the next period of employment, when the employee was hired on permanently on February 3. She could not be said to have been hired 13 weeks prior to the expected date of birth and is thus not entitled to take a pregnancy leave (although she will be entitled to a parental leave 13 weeks after February 3).
On the other hand, if the employee's contract had ended February 1 and she was hired permanently on February 2, she would be entitled to pregnancy leave, as she is considered to have commenced her employment on August 1, which is at least 13 weeks prior to her February 19 due date.
An employee may move from contract to permanent, or from part-time to full-time status, or vice versa, within the 13-week qualifying period without affecting the entitlement to leave. If the applicant has been the employer's employee for the entire 13-week period, whether active or inactive, contract or permanent, part-time or full-time, she is entitled to the leave. The qualifying condition makes no distinction between contract, permanent, active, inactive, part-time or full-time employees.
These provisions place restrictions on the earliest a qualified employee can begin her pregnancy leave.
Section 46(2) states that the earliest a pregnancy leave can begin is the earlier of two points in time, namely, 17 weeks before the due date (clause (2)(a)) or the date of birth (clause (2)(b)). Section 46(3) provides that in cases of still-birth or miscarriage, clause (2)(b) will not apply.
Together, subsection 46(2) and 46(3) mean that the earliest day a pregnancy leave can begin is 17 weeks before the due date. However, if there is a live birth (as opposed to a still-birth or miscarriage) more than 17 weeks before the due date, the pregnancy leave can begin as early as the birth date. (This latter result was introduced by the Employment Standards Act, 2000. Previously, women who had live births more than 17 weeks before the due date were not entitled to take a pregnancy leave.) In cases of still-birth or miscarriage, the earliest a pregnancy leave can begin is 17 weeks before the due date. Because an employee cannot begin a pregnancy leave any later than the date of birth (see section 46(3.1)), a woman whose pregnancy ends in a miscarriage or still-birth more than 17 weeks before the due date is not entitled to take a pregnancy leave (although she may be eligible for sick leave under section 50 or qualify for some additional leave under her contract of employment, such as short term disability).
Under predecessor pregnancy leave provisions in the former Employment Standards Act, RSO 1980, c 137 (section 35), an employer could require an employee to stop work at any time during the pregnancy, "at such time as the duties of her position cannot reasonably be performed by a pregnant woman or the performance of her work is materially affected by the pregnancy." This meant that the employee could be "put" on a pregnancy leave. That provision was repealed in 1990 and is not part of the Employment Standards Act, 2000. It is the employee's right to decide when she will commence leave (within the times set out in section 46) or if she will take a leave at all.
Under the Ontario Human Rights Code, RSO 1990, c H.19 (the "Code"), employers are required to accommodate the needs of pregnant employees, unless that would cause undue hardship to the business. Therefore, where an employee is unable, because of her pregnancy, to perform some aspect of her job, the Code provisions could require the employer to relieve her of the responsibilities of that aspect of her position but allow her to continue working. It would be inconsistent with this obligation to allow employers to force pregnant employees onto a pregnancy leave where their performance was adversely affected by the pregnancy.
In addition, because employers no longer have the right to "put" an employee on her leave before she had otherwise intended to go, an employee who is sick - even though it is related to or caused by the pregnancy - will be entitled to be treated like any other sick employee until the date she commences her leave. In James v Craiglee Nursing Home, 2004 CanLII 30948 (ON LRB) the employee was unable to perform the duties of her job for health reasons related to her pregnancy and went off sick on November 23, 2001. Her baby was born on February 27, 2002. She did not provide the employer with any written notice with respect to the pregnancy leave. On February 12, 2003 when she contacted the employer to ask to be put on the shift schedule she was informed that she had "overstayed" her leave. The employer argued that her pregnancy leave had commenced November 23, 2001 and they no longer had any obligation to reinstate her in February 2003. The Ontario Labour Relations Board found on the evidence that the employee had left on a sick leave with the full knowledge of the employer on November 23, 2001. The Board further held that although the employee gave the employer no written notice with respect to the commencement of the pregnancy leave that it had in fact commenced on the date of the baby's birth (February 27, 2002) in accordance with section 46(2)(b). The employer therefore had an obligation to reinstate her at the end of February 2003. The Board ordered reinstatement.
What if the employee is on lay-off at the point when she would otherwise have commenced the leave? Depending on the timing of the lay-off in relation to her due date, she may have the option to convert from lay-off to pregnancy leave. This is because once the employee commences her leave, the "lay-off clock" for the purposes of Part XV (Termination and Severance of Employment) of the Act stops running. A week of lay-off is defined to exclude weeks in which the employee is unavailable for work, and an employee is unavailable for work if she is on a leave.
Note that in all of the following examples, it is assumed that the employee gave birth on her due date.
Thirty weeks before the employee's due date, she is laid off. Benefits are not continued. The employee had intended to commence pregnancy leave on her due date. Seventeen weeks before the due date (13 weeks after the lay-off began), her employment would be deemed terminated pursuant to Part XV of the Act, effective the first day of the lay-off. However, she could convert to pregnancy leave on the day her employment was to be terminated (being within 17 weeks of due date).
If the employee did not take any active steps to convert or notify her employer at the time, the principles enunciated in Re Scott and Roos Family Shoes (Brampton) Ltd. et al., 1985 CanLII 2124 (ON SC), a decision under the former Employment Standards Act, would apply such that she would not lose her entitlement to take pregnancy leave despite her lack of notice. However, special attention should be paid to the evidence supporting the employee's claim that she had intended to convert from lay-off to pregnancy leave prior to the deemed termination.
Thirty-six weeks before the employee's due date, she is laid off. Benefits are not continued. Twenty-three weeks before the due date (i.e., 13 weeks after the lay-off began), the employee is deemed terminated for the purposes of Part XV of the Act, effective the first date of lay-off. There is no right to the leave, as the employment relationship has come to an end before the earliest date she could begin a leave. It is important to note that, for the purposes of this example, the termination had nothing to do with the employee's intention to take a leave.
This provision was introduced by the ESA 2000. It codifies Program policy under the former Employment Standards Act.
Section 46(3.1) places restrictions on the latest a qualified employee may begin her pregnancy leave. The leave must begin no later than the due date or the birth date, whichever occurs first.
These provisions are similar to the corresponding provision (s. 35(3)) of the former Employment Standards Act. One change, however, is that an employee is now only required to produce a medical certificate indicating her due date if asked to do so by her employer.
Section 46(4)(a) requires a pregnant employee to give two weeks' written notice of her intention to take a pregnancy leave. Under s. 46 (4)(b), the employee must submit a medical certificate that shows the due date, if asked to do so by the employer.
An employee's failure to conform to the statutory requirements for notice will not disentitle her to the pregnancy leave. It is the Program's view that the requirement to give notice of the leave is not a condition precedent to the entitlement to the pregnancy leave. An employee's entitlement to leave arises by virtue of having commenced her employment at least 13 weeks prior to the due date and it is the Program's position that the failure to give notice does not negate or diminish that entitlement. The Program's policy is consistent with the Ontario Divisional Court decision in Re Scott and Roos Family Shoes (Brampton) Ltd. et al.in which the Court held that the written notice requirement in the former Employment Standards Act was a formality only.
Under s. 46(5), an employee who has given notice to begin a pregnancy leave is entitled to change the date on which the leave will begin.
The employee may begin her leave on an earlier date than set out in her original notice, provided she gives the employer at least two weeks' written notice before the earlier day on which she now wishes to begin her leave.
The employee may begin her leave on a later day than set out in her original notice, provided she gives the employer at least two weeks' written notice before the day that was set out in her original notice.
Note that the options given to an employee by s. 46(5) to change the starting date of her leave remain subject to the limitations on the earliest and latest dates a leave may begin set out in ss. 46(2) and (3.1).
This provision is similar to the corresponding provision (s. 36(1)) of the former Employment Standards Act. The only change is that an employee is now only required to provide a medical certificate if asked to do so by her employer.
If an employee stops work due to complications arising from the pregnancy, or because of a premature birth, still-birth or miscarriage, the alternate notice provisions set out in s. 46(6) will apply instead of those set out in s. 46(4).
The notice must state the day the pregnancy leave began if the employee stops working because:
The notice must state the date the pregnancy leave will begin where the employee has suddenly had to stop work because of complications related to the pregnancy but has not yet given birth and does not wish to commence the leave at this point. For example, she may intend to commence the leave on the due date and use her sick benefits in the meantime.
For an employee who stops working due to complications caused by the pregnancy (whether or not she is beginning her pregnancy leave immediately upon stopping work), the medical certificate, if requested by the employer, must confirm that she is unable to perform the duties of her position, and state the employee's due date. In any other case, the medical certificate must state the due date and the actual date of the birth, still-birth or miscarriage.
This section defines legally qualified medical practitioner for the purposes of ESA Part XIV, s. 46. Subsections 46(4)(b) and 46(6)(b) specify that if the employer requests it, the employee must provide the employer with a certificate from a legally qualified medical practitioner stating the employee’s due date, that she is unable to perform the duties of her position due to pregnancy complications, or the actual date of the birth, still-birth or miscarriage to support the commencement of her pregnancy leave.
"A person who is qualified to practise as a physician" generally means a medical doctor who is a member of the College of Physicians and Surgeons of Ontario. A physician of any specialty will meet the definition, however, practically speaking an obstetrician-gynecologist or a family medicine or general practitioner will likely be the person who issues the certificate.
Where care or treatment is provided in a jurisdiction other than Ontario, the question of whether the person is “qualified to practice as a physician” is determined with reference to the laws of that other jurisdiction.
“A person who is qualified to practise as a midwife” generally means a member of the College of Midwives of Ontario and a holder of a general certificateper the Midwifery Act, 1991.
Where care or treatment is provided in a jurisdiction other than Ontario, the question of whether the person is “qualified to practice as a midwife” is determined with reference to the laws of that other jurisdiction.
"A registered nurse who holds an extended certificate of registration" means a member of the College of Nurses of Ontario who is a registered nurse and holds an extended certificate of registration in accordance with O Reg 275/94 made under the Nursing Act, 1991, SO 1991, c 32. These individuals are generally known as nurse practitioners in Ontario. This definition does not include a registered nurse who is a holder of a general certificate, or a registered practical nurse.
At the time of writing, no circumstances and no class of medical practitioners have been prescribed.
The Fair Workplaces, Better Jobs Act, 2017, SO 2017, c 22, amended s. 47(1)(b)(ii) of the Employment Standards Act, 2000 on January 1, 2018. Please see s. 47(1.1) below for more information on the application of this provision with respect to a leave commenced prior to January 1, 2018.
Under s. 47(1)(a), the pregnancy leave of an employee who is entitled to a parental leave (e.g., where there has been a live birth) will end 17 weeks after it began.
Section 47(1)(b) only applies where an employee is not entitled to a parental leave. In other words, it only applies where there is no child (i.e., it has not been born yet) or where it is still-born or died before the pregnancy leave ended. The effect of this provision is two-fold. First, it enables an employee who has used all 17 weeks of pregnancy leave before the child is born to remain on pregnancy leave up until the birth. Secondly, it ensures that employees who have a miscarriage, still-birth or whose child dies during the pregnancy leave will have at least 12 weeks after the date of delivery before the employee’s pregnancy leave ends. Similarly, an employee who has had a miscarriage during her pregnancy leave will have at least 12 weeks after the miscarriage before she can be required to return to work.
An employee commenced her pregnancy leave 15 weeks before the baby’s due date. Two weeks after the due date (which is 17 weeks after the pregnancy leave began) the baby is still not born. The baby is born two weeks later, or 19 weeks after the pregnancy leave first began. Because the employee was not entitled to parental leave after 17 weeks of pregnancy leave (because the baby was not yet born), s. 47(1)(a) would not apply to end the leave at that point. Instead, s. 47(1)(b) would apply to extend the pregnancy leave on the basis that the leave cannot end until the later of the day that is 17 weeks from the date the leave began or 12 weeks after the date of birth. In this example, a live birth would trigger the end of the pregnancy leave because the employee no longer falls under the description in s. 47(1)(b) — that is, she is no longer not entitled to a parental leave. In turn, the end of the pregnancy leave will necessitate the commencement of the parental leave (assuming that the employee wishes to take parental leave) because s. 48(3) states that the parental leave of an employee who takes a pregnancy leave must commence when the pregnancy leave ends. It is Program policy that the pregnancy leave is not extended for 12 weeks after the date of the birth. This employee ends up with 19 weeks of pregnancy leave followed immediately by her parental leave. It is important to note that an extension of the pregnancy leave does not act to reduce an employee’s entitlement to parental leave.
In the event the child in the example above had been still-born, s. 47(1)(b) would have applied to give the employee an additional 12 weeks of pregnancy leave after the delivery. In that case, she would have had a total of 31 weeks of pregnancy leave, although she would not get any parental leave.
The employee delivered the baby on the due date, which happened to be 15 weeks after the pregnancy leave began, and the child died one week later (i.e., before the pregnancy leave ended). In this case, s. 47(1)(b) would apply. As an employee not entitled to take a parental leave, her pregnancy leave would end on the later of the date that is 17 weeks after the leave began or 12 weeks after the birth of the child. This employee would end up with 27 weeks of pregnancy leave (15 weeks before the birth plus 12 weeks after the birth), but again, would not be entitled to any parental leave.
The Fair Workplaces, better Jobs Act, 2017, SO 2018, c 22 amended the ESA 2000 on January 1, 2018 and extended the entitlement in s. 47(1)(b)(ii) from six weeks after the birth, still-birth or miscarriage to 12 weeks after the birth, still-birth or miscarriage.
As such, if an employee commences a pregnancy leave on or after January 1, 2018 and is ultimately not entitled to a parental leave because of a still-birth, death of a child or miscarriage, she will be able to remain on pregnancy leave until the later of 17 weeks after the leave began or 12 weeks after the birth, still-birth or miscarriage.
For employees whose pregnancy leave commenced prior to January 1, 2018, the reference to 12 weeks in s. 47(1)(b)(ii) must be read as 6 weeks. In other words, if an employee who started her pregnancy leave before January 1, 2018 is not entitled to take a parental leave due to a still-birth, death of a child or miscarriage, she will be entitled to remain on pregnancy leave until the later of 17 weeks after the leave began or six weeks after the date of the birth, still-birth or miscarriage.
If the employee intends to return to work either before the end of the 17 weeks set out in s. 47(1)(a), or the potentially longer period of leave as set out in s. 47(1)(b), the employee must give the employer notice in writing at least four weeks in advance of the date she plans on returning.
It should be noted that if the employee has chosen to shorten her pregnancy leave and return to work, she gives up the balance of pregnancy leave she would otherwise have had. Pregnancy leave (like parental leave) cannot be started and stopped and resumed at a later date. An employee has the right to take a pregnancy leave that is at least 17 weeks long, but she may also choose to take any shorter period, which will be considered to represent her full entitlement to the leave. In addition, unless the child is still in hospital on the day the leave ends, she will forfeit her right to parental leave because it must be commenced when the pregnancy leave ends; see ESA Part XIV, s. 48(3).
The employer has no right to require the employee to provide any documentation to prove that she is fit to return to work.
In contrast to the Program’s position respecting the notice requirements to commence the leave, it is the Program’s position that the employer can refuse to allow the employee to return to work at an earlier date than that provided for in ss. 47(1)(a) and (b) if the employee has not given the employer four weeks’ notice in writing.
Under s. 47(3), an employee who has given notice under s. 47(2) to end her leave early is entitled to change her mind and end the leave on an even earlier or later date. If she wishes to end the leave on an earlier date than that set out in her original notice, the employee must give her employer a new written notice at least four weeks before the earlier day on which she now proposes to end the leave.
If the employee wishes to end the leave on a later date than that specified in the original notice, she must give the employer a new written notice at least four weeks before the return date indicated in the original notice.
In contrast to the Program’s position respecting the notice requirements to commence a leave, it is the Program’s position that the employer can refuse to allow the employee to return to work at an earlier or later date than the date provided in her notice under s. 47(2) if the employee has not given the employer four weeks’ notice in writing.
Section 47(4) provides that an employee who takes pregnancy leave shall not terminate her employment before the leave expires or when it expires, without giving the employer at least four weeks' written notice of the termination. This section should be read in conjunction with s. 47(5), which creates an exception for employees who are constructively dismissed — see the discussion of s. 47(5) below.
While an employer can file a complaint with the Program if the employee fails to give proper notice, there is no remedy available to it under the ESA 2000 that would allow it to recover any damages that arose from the failure to provide notice. In order to recover such damages, the employer would have to pursue a civil remedy. The employer cannot make a deduction from any outstanding wages due to the employee (for example, commissions that became due to the employee during the leave) in an attempt to recover the damages.
Section 47(5) creates an exception to the requirement in section 47(4) that an employee on a pregnancy leave provide four weeks' written notice of their intention to resign before or upon the expiry of the leave. The notice requirement will not apply in situations where the employer has constructively dismissed the employee. See Employment Standards Act, Part XV, section 56(1) for a discussion of constructive dismissal. The same principles apply here.
The entitlement to a parental leave arises following the birth of a child (as in the case of a birth mother, including a surrogate mother, or a birth father) or the coming of a child into the custody, care and control of an employee for the first time (generally all parents other than birth parents, including adoptive parents). Parental leave may not be commenced before the actual day of birth or the day that the child came into an employee's custody, care and control; in other words, not before the employee is a parent. See Employment Standards Act, Part XIV, section 45 for a discussion of the definition of parent.
To be eligible for parental leave, the employee has to have been employed for at least 13 weeks prior to the commencement of the leave. Note that the reference date for parental leave eligibility is the date the leave is to begin, whereas the reference date for pregnancy leave eligibility is the due date. As with the pregnancy leave qualifying period, it is not necessary that the employee be actively working for all or any part of the 13 weeks prior to commencing the leave. For example, the employee could be off sick, on vacation or on lay-off during the qualifying period.
It should be noted that there is no requirement that the employee work 13 weeks after the child is born or comes into custody, care and control of the parent.
A birth father may want to start his parental leave on the actual date of birth. In that case, he should give his employer at least two weeks' notice before the expected date of birth, as required by s. 48(4). If the baby is born prior to that date, he can start his leave on the birth date, but he must then comply with the retroactive notice provisions set out in s. 48(6). If the baby has not yet been born by the due date, he must continue working until the actual birth date; he cannot begin parental leave prior to the birth of the child because he will not yet meet the eligibility criteria of being a parent. In this latter case, after the due date has passed, the employer will essentially be on day-to-day notice that the employee will go on leave, and will not really have received the required two weeks' notice. However, the employer would have known approximately when the employee would leave, and, as with pregnancy leave, an employee's failure to conform to the statutory requirement to provide notice of a leave will not disentitle them to the parental leave. See Employment Standards Act, Part XIV, section 46(4).
An employee's entitlement to parental leave arises by virtue of being a new parent and having commenced their employment at least 13 weeks prior to taking the leave, and it is the Program's position that the failure to give notice does not negate or diminish that entitlement. The Program's policy is consistent with Re Scott and Roos Family Shoes (Brampton) Ltd. et al., 1985 CanLII 2124 (ON SC) in which the Ontario Divisional Court held that the written notice requirement in the former Employment Standards Act was a formality only.
An employee on lay-off may still be entitled to take a parental leave. Refer to the extensive discussion on how lay-off impacts on pregnancy leave in Employment Standards Act, Part XIV, section 46(2). The same principles apply to parental leave.
The Fair Workplaces, Better Jobs Act, 2017, SO 2017, c 22 amended s. 48(2) on December 3, 2017. The timeframe within which a parental leave may begin for an employee, other than a birth mother who has taken pregnancy leave, was extended from 52 to 78 weeks. See s. 48(2.1) below for more information on the application of this provision prior to December 3, 2017.
This section provides that an employee who is the parent of a child must commence parental leave within 78 weeks of either the date the child was born, or the date the child came into the parent's custody, care and control for the first time.
This section does not require the leave to be completed within the 78-week period. It requires the leave to be commenced within that period.
Other than the requirement to commence the leave within the 78-week period, the parent is not restricted in any other way with respect to the commencement of the leave. Whether the employee's partner or spouse takes a pregnancy or parental leave, or the fact that the employee's partner or spouse may be on either of those leaves will not affect the employee's right to commence a parental leave.
Note that s. 48(3) sets out special rules regarding commencement of parental leave for a birth mother who has taken pregnancy leave. A birth mother who has taken a pregnancy leave will not have the 78-week period as set out in s. 48(2) within which to commence the leave except in special circumstances. See the discussion in s. 48(3) below.
A birth father, and a birth mother who does not take pregnancy leave, will normally be required to commence the leave within 78 weeks of the date the child is born because typically, the birth date is also the date the child first comes into the custody, care and control of the parents. In the case of a birth without significant complications, the fact that the mother and the baby remain in hospital for a few days does not mean that the hospital, rather than the parents, had custody, care and control of the child.
However, if the child has significant medical problems that necessitate a lengthy hospital stay following birth, the date that the child was actually released from hospital into their parents' care should be regarded as the date that the child came into their custody, care and control for the first time. With one exception, either or both parents could choose to commence the leave within 78 weeks of the date of the birth, or they could defer commencing the leave to some point within the 78-week period following the date the child was released from hospital.
The exception to this is that a birth mother who had taken pregnancy leave and who was still on that leave when the child was released from hospital would be required to commence her parental leave when the pregnancy leave ended. See the discussion in s. 48(3) below regarding commencement of parental leave for birth mothers who have taken pregnancy leave.
Parents other than birth parents must begin parental leave within 78 weeks of the date the child first comes into custody, care and control of the parent, after the employee becomes a parent.
The definition of parent includes a person with whom a child is placed for adoption. It is Program Policy that "placed for adoption" means that adoption proceedings must have been commenced but do not necessarily have to have been completed.
Once the employee is an adoptive parent and therefore entitled to take a leave, the 78-week clock will run from the date the child first comes into the parent's custody, care and control i.e. the date the child was placed for adoption.
Section 48(2) also applies to employees who become parents by virtue of entering into a relationship of some permanence with a person who is already a parent of a child, together with their intent to treat to treat that child as their own.
Once the employee is a parent, the 78-week clock will run from the date the child first comes into that parent's custody, care and control. See Employment Standards Act Part XIV, section 45 for a discussion.
The Fair Workplaces, Better Jobs Act, 2017, SO 2017 c 22 amended the Employment Standards Act, 2000 to extend the timeframe within which an employee may begin a parental leave to correspond with changes in the way employment insurance benefits could be taken.
Employees who did not take a pregnancy leave and whose child was born or came into their custody, care, or control on or after December 3, 2017, are required to begin their leave within 78 weeks of the date of birth or of the child coming into the employee’s custody, care or control.
An employee who did not take pregnancy leave and whose child was born or came into their custody, care or control prior to December 3, 2017 is limited to the previous timeframe of 52 weeks for beginning the leave.
Section 48(3) applies only to a birth mother who has taken a pregnancy leave. It requires that she commence her parental leave immediately after the pregnancy leave ends except in special circumstances. As a consequence, she cannot return to work when the pregnancy leave ends and retain a right to parental leave under the ESA 2000.
It is important to note that under federal Employment Insurance legislation, a birth mother may be entitled to return to work for a while after her maternity benefits run out and before starting to receive her parental benefits. Many employees are under the misconception that the requirements for commencement of the leave itself are the same as those regarding entitlements to employment insurance benefits, or they may believe that the right to the employment insurance benefits is the same thing as the right to leave. It should be emphasized that an employee who wishes to avail herself of the right to leave and protect her rights to benefits during the leave and reinstatement afterward must (with one exception) commence the parental leave when the pregnancy leave ends. However, see Royce v Huan and Danczkay Properties Inc. (July 12, 1995), ESC 95-136 (Novick), a decision under the former Employment Standards Act in which the adjudicator found that although the employee returned to work at the employer's request for a couple of days after her pregnancy leave, she was not disentitled to parental leave. This aspect of the decision is contrary to Program policy.
The exception to this requirement occurs when the child has not come into the custody, care and control of the employee for the first time, by the time the employee has ended her pregnancy leave. In such cases, s. 48(2) will apply and the birth mother must commence the parental leave within 78 weeks of the date of the birth or the date the child first comes into her custody, care and control for the first time. For example, if the child was hospitalized from birth and was still in the hospital's care when her leave ended, the employee could return to work and delay the commencement of her parental leave until the child came home.
Note that the exception will not apply in situations where the child was released from hospital, then subsequently became ill and re-entered the hospital and was still there when the birth mother's pregnancy leave ended. In this situation, the employee would already have had the child in her custody, care and control for the first time prior to the date the pregnancy leave ended.
The application of s. 48(3) is limited to those situations where the birth mother has taken a pregnancy leave. A birth mother who did not take pregnancy leave (e.g., she was ineligible because she had not been hired at least 13 weeks before the expected date of birth, or she was eligible for pregnancy leave but simply chose not to take it) is governed by s. 48(2), and is allowed to commence the parental leave at any time within 78 weeks of the date of birth or date the child first came into her custody, care and control.
An employee who wishes to take parental leave is required to give at least two weeks' notice in writing of their intention to take parental leave. For the employee who is on pregnancy leave, this means that she must notify her employer of her intention to take parental leave at least two weeks before the pregnancy leave ends, unless the child has not yet come into her custody, care and control for the first time and she is delaying the start of her parental leave. She cannot be forced to give notice of her intention to take parental leave at the same time she gives notice of her intention to take pregnancy leave.
The Program takes the position that the principle enunciated in the Re Scott and Roos Family Shoes (Brampton) Ltd. et al.decision in the pregnancy leave context applies equally to the parental leave context – see the discussion of this case in Part XIV, section 46(4). In other words, failure to comply with the requirement to provide two weeks' written notice of a parental leave will not diminish the employee's right to the leave.
Section 48(5) permits an employee who has given notice to begin parental leave to change the date upon which the leave begins if certain conditions are met. Where the employee wishes the leave to begin on an earlier date, s. 48(5)(a) requires a new written notice by the employee at least two weeks before the earlier date. Where the employee wishes the leave to begin on a later date, s. 48(5)(b) requires a new written notice at least two weeks before the date that was set out in the original notice.
An employee wishing to change the date the parental leave will start must, of course, still comply with the restrictions on the earliest and latest the leave can begin as set out in ss. 48(1), (2) and (3).
This section provides an alternate notice requirement where an employee stops work before giving notice of an intention to take a parental leave, or before the parental leave was scheduled to begin, because the child came into the custody, care and control of the employee earlier than expected. In that case, the leave begins on the day the employee actually stops working, and the employee must provide written notice within two weeks after stopping work.
Note, however, that the Program takes the position that the principle enunciated in the Re Scott and Roos Family Shoes (Brampton) Ltd. et al. decision under the former Employment Standards Act, 2000 in the pregnancy leave context applies equally in the parental leave context. In other words, failure to comply with the requirement to provide written notice of the parental leave will not diminish the employee's right to the leave.
An example of where this provision will apply is where a birth father gave his employer two weeks' notice prior to the estimated date of birth, and the baby was born earlier than expected. The father can commence his leave as early as the birth date, and must comply with the retroactive notice provisions in s. 48(6)(b). Note, however, that this provision won't apply, for example, where the baby is born prematurely and then goes into neo-natal intensive care for weeks or months. In that case, the baby has not yet come into the custody, care and control of the parent.
A parental leave will end 61 weeks after it began if the employee also took a pregnancy leave, or 63 weeks after it began if the employee did not take a pregnancy leave, unless the employee provides notice of an earlier return date pursuant to s. 49(2). In other words, the employer must assume that an employee who has taken a parental leave will be gone for the full 61 or 63 weeks unless the employee gives written notice to the contrary. There is no obligation for an employee to take the full amount of the leave. If, for example, an employee opts to receive federal Employment Insurance (“EI”) benefits at a higher rate over a 52 week period instead of a lower rate over an 18 month period, they may wish to take a leave that is shorter than the full entitlement. See remarks on changes to the federal EI program, below.
The length of parental leave was increased on December 3, 2017 in order to enable employees to take advantage of the extended period of time over which EI parental benefits may be taken. It is important to note, however, that there remain significant differences regarding entitlements between the Employment Standards Act, 2000 and the federal Employment Insurance Act, SC 1996, c 23. For example, parents can take some paid work with their employer without losing any EI parental benefits. They can also interrupt the period in which they receive EI benefits and return to work, then begin receiving benefits again at a later date.
However, the ESA 2000 does not contemplate "splitting" parental leave (or pregnancy leave). For example, an employee cannot take 10 weeks of parental leave under the ESA 2000, return to work for some period and then take the balance of 51 or 53 weeks of parental leave. Because the ESA 2000 does not contemplate stopping and restarting the leaves, an employee who returns to work early is considered to have ended their leave under the ESA 2000.
In this regard see a decision of the Ontario Grievance Settlement Board in Association of Management, Administrative and Professional Crown Employees of Ontario v Ontario (Management Board Secretariat), 2005 CanLII 55230 (ON GSB), in which the arbitrator concluded that the "legislature intended to provide employees with the opportunity to take one continuous parental leave of absence following a birth or adoption". In this regard, the arbitrator noted that there was no explicit language in the ESA 2000 to support a right to take the leave in instalments and furthermore, that it was clear that an effort had been made to balance the employee benefit (the leave entitlement) with an employer's interest in avoiding the disruption that could result if employees were permitted to split up parental leave. The arbitrator also rejected the union's argument that the ESA 2000's provisions should be interpreted in a manner consistent with the Employment Insurance Act on the basis that there is nothing the ESA 2000 to suggest that entitlement to a leave is dependent only upon an employee receiving EI benefits.
Note that Program policy is that employees will not be considered to have ended their ESA 2000 leave if they take work with an employer from whom they did not take the leave. For example, an employee may take a parental leave from their full-time job with employer A and work part-time with employer B during their leave without losing their entitlement to the ESA 2000 parental leave from their full-time job.
Once employees begin a parental leave, they have the right to take the full 61 or 63 weeks. For example, a birth father whose child dies five weeks into his parental leave has the right to take the remaining 58 weeks of leave if he wishes.
The Fair Workplaces, Better Jobs Act, 2017 amended the ESA 2000 and extended the amount of parental leave available to employees on December 3, 2017 to correspond with changes in the way EI benefits could be taken. Previously, employees who had taken pregnancy leave were entitled to 35 weeks of parental leave, and employees who had not taken pregnancy leave were entitled to 37 weeks.
This section provides that if the child was born or first came into the employee’s custody, care and control for the first time before December 3, 2017, the employee’s parental leave ends 35 weeks after it began, if the employee took preganancy leave, or 37 weeks after it began otherwise. If the child was born or first came into the employee’s custody, care and control on or after December 3, 2017, the employee is entitled to take the longer leave of up to 61 or 63 weeks.
Section 49(2) provides that a parental leave may end earlier than 61 or 63 weeks after it began, as provided in s. 49(1), if the employee gives the employer at least four weeks' written notice before the earlier date.
Unlike the Program's position with respect to the notice requirements to commence the leave, it is the Program's position that the employer can refuse to allow the employee to return to work earlier than the 61 or 63 week mark if the employee has not given the employer four weeks' notice in writing.
In contrast to the Program's position with respect to the notice requirements to commence the leave, it is the Program's position that the employer can refuse to allow the employee to return to work at a different date than that indicated in their previous notice if the employee has not given the employer four weeks' notice in writing.
However, where an employee does not provide enough notice, an employer that does not accept the new return date must communicate its refusal at the time of the request or shortly thereafter. An employer cannot keep its objection to itself and then rely on the employee's failure to provide proper notice to defeat the employee's right to reinstatement. For example, an employee wants to change her return date to a date that is three weeks later than her original return date, but she gives only two weeks' written notice of this change. The employer does not provide the employee with approval, but neither does it communicate its objection to the employee. The employer cannot claim in these circumstances that the employee has lost her right to reinstatement because of her failure to comply with s. 49(3). In this regard, see Royce v Huan and Danczkay Properties Inc. (July 12, 1995), ESC 95-136 (Novick).
Section 49(4) provides that an employee who takes parental leave shall not terminate their employment before the leave expires, or when it expires, without giving the employer at least four weeks' written notice of the termination. This section should be read in conjunction with s. 49(5), which creates an exception to the notice requirement for employees who are constructively dismissed – see the discussion of section 49(5) below.
While an employer can file a complaint with the Program if the employee fails to give proper notice, there is no remedy available to it under the Employment Standards Act, 2000 that would allow it to recover any damages that arose from the failure to provide notice. In order to recover such damages, the employer would have to pursue a civil remedy. The employer cannot make a deduction from any outstanding wages due to the employee (for example, commissions that became due to the employee during the leave) in an attempt to recover the damages.
Section 49(5) provides an exception to the requirement in s. 49(4) that an employee on parental leave provide four weeks' written notice of their intention to resign before or upon the expiry of the leave. The requirement does not apply where the employer has constructively dismissed the employee. See Employment Standards Act Part XV, section 56 for a discussion of constructive dismissal. The same principles apply here.
This section contains definitions of two of the terms used in the family medical leave provisions.
"Qualified health practitioner" is referred to in s. 49.1(2). In order for an employee to be entitled to a family medical leave, a qualified health practitioner must issue a certificate stating that an individual has a serious medical condition with a significant risk of death occurring within a period of 26 weeks, and that individual must be a family member specified in s. 49.1(3).
Qualified health practitioner is defined for the purpose of the family medical leave provisions as:
“Week” means a period of seven consecutive days beginning on Sunday and ending on Saturday. For the purposes of family medical leave, week will always be Sunday to Saturday, even if the employer's work week is different. A Sunday to Saturday week was chosen in order to mirror the Compassionate Care Benefits Program in the Employment Insurance Act, SC 1996, c 23 which uses a Sunday to Saturday week for purposes of determining entitlement to, and the paying of, employment insurance benefits.
Subsection 49.1(2) provides for an entitlement to family medical leave if the eligibility requirements set out in the subsection are met.
Please note that the Fair Workplaces, Better Jobs Act, 2017, SO 2017, c 22 made amendments to s. 49.1(2) of the Employment Standards Act, 2000 on January 1, 2018. These changes, among other things, affected the length of leave and the leave period. See s. 49.1(13) below for more information on how this provision applies to leaves taken with respect to certificates issued prior to January 1, 2018.
Employees are entitled to take up to 28 weeks of unpaid family medical leave with respect to a particular individual. Week is defined in s. 49.1(1) as being a period of seven consecutive days beginning on Sunday and ending on Saturday.
Nothing in the ESA 2000 requires that the weeks of family medical leave be taken consecutively. An employee could, for example, take four weeks of leave, return to work for a while, and then take a further six weeks of leave.
Subsection 49.1(7) states that family medical leave must be taken in periods of entire weeks. However, the subsection must be read in conjunction with ESA Part XIV, s. 52.1, which applies to any Part XIV leave that must be taken in periods of entire weeks and which addresses the situation where an employee stops providing care or support part-way through a week. Further, the Program has a policy that addresses the situation where an employee only begins providing care or support part-way through a week. Subsection 49.1(7) below contains a detailed discussion of how s. 49.1(7), s. 52.1 and the Program policy apply where an employee who takes family medical leave provides care or support for only part of a week. Briefly, the combined effect of the two statutory provisions and the Program policy is as follows:
Section 49.1(6) provides that where more than one employee takes a leave under s. 49.1 in respect of the same family member, the maximum 28 weeks' leave has to be shared by the employees.
Section 49.1(11) provides that employees may take multiple family medical leaves with respect to the same family member if the eligibility criteria are met. However, only one leave of up to 28 weeks may be taken in each 52-week period with respect to the same family member.
An employee is entitled to up to 28 weeks (or more, if the further leave provision of s. 49.1(11) applies) of family medical leave with respect to each individual listed in s. 49.1(3). There is no limit on the number of specified family members for whom an employee may take family medical leave. If, for example, an employee has two specified family members who have a serious medical condition and significant risk of death within a 26-week period, the employee will be entitled to two separate family medical leaves. The timing and duration of each leave, the notice requirements, and the rules regarding eligibility for further leaves with respect to each leave, etc., are governed by s. 49.1 independently of one other.
The family medical leave entitlement is for providing care or support to the ill family member. This will include, for example, providing psychological or emotional support to the family member, assisting the family member to get their affairs in order, assisting the family member with regular household chores (e.g., housekeeping, laundry, shopping) as well as arranging for care by a third party provider, and directly providing or participating in the personal care of the family member.
Employees are entitled to family medical leave with respect to the family members listed in s. 49.1(3).
An employee is eligible for family medical leave if a qualified health practitioner issues a certificate stating that the individual has a serious medical condition with a significant risk of death occurring within a period of 26 weeks or such shorter period as may be prescribed.
See the discussion of the meaning of this term in the family medical leave context in s. 49.1(1) above.
Because s. 49.1(2) uses the present tense — "issues" as opposed to "has issued" — an employee may begin a family medical leave before a certificate is issued.
For example, an employee might obtain the certificate soon after beginning the leave, or after the leave is over, or - if the employer engages in a reprisal against the employee – soon after the reprisal or when asked to by an employment standards officer during the course of a reprisal investigation. Or, an employee may have had a certificate completed by someone who fits within the definition of a qualified health practitioner for family caregiver leave purposes (but not within the narrower definition of that term that applies for family medical leave purposes) and having recognized their mistake during the officer's investigation, subsequently obtained a certificate from the appropriate individual. In all of these cases, because a certificate was ultimately issued - by someone who is eligible to issue it - the employee will be considered to have fulfilled this eligibility criterion. However, if the employee never does obtain a certificate, they will obviously not have an entitlement to family medical leave.
The employee may wish to use the Ministry's "Medical Certificate to Support Entitlement to Family Caregiver Leave, Family Medical Leave, and/or Critical Illness Leave" form when obtaining the medical certificate. It is available on theMinistry of Labour's website.
If an employee is applying for Employment Insurance (“EI”) compassionate care benefits, a copy of the medical certificate submitted to Employment and Social Development Canada may also be used for the purposes of family medical leave.
Pursuant to the definition of week in s. 49.1(1), the 26-week period relating to the significant risk of death will always begin on a Sunday.
If the certificate states that the significant risk of death began on a day other than a Sunday, the 26-week period will begin on the previous Sunday.
For example, if a doctor issues a certificate on Wednesday, June 30, stating that the employee's mother has a serious medical condition and is at significant risk of death within 26 weeks from that date, the 26 week period actually begins on Sunday, June 27, and ends 26 weeks later. The definition of week has implications for when the leave can begin, and the latest date the employee can remain on leave. See ss. 49.1(4) and (5), discussed below.
Note in particular that because the 26-week period begins on the previous Sunday when a certificate states the significant risk of death began on a day other than a Sunday, an employee is eligible for family medical leave immediately upon the significant risk of death arising; they do not have to wait until the next Sunday before beginning family medical leave.
Another example is where the doctor issues the certificate on Saturday, July 10, indicating the employee's father has a serious medical condition and was at significant risk of death from Wednesday, June 30. In this case, the 26-week period begins on Sunday, June 27.
There may be cases in which the certificate indicates that the individual has a serious medical condition with a significant risk of death occurring within a period that is less than 26 weeks. For example, a doctor issues a certificate on Sunday, June 27 stating that the employee's spouse has a serious medical condition and is at significant risk of death within six weeks of that date. It is Program policy to apply the certificate as if it said that the spouse was at significant risk of death within 26 weeks. The employee will not be required to obtain a second certificate if the six week period elapses and the spouse is still alive.
This is because the Program takes the view that the reference to 26 weeks in s. 49.1(2) is intended simply to provide a maximum period in which a risk of death will entitle an employee to family medical leave and not to limit the period in which leave can be taken where the health practitioner anticipates that the individual will die sooner than 26 weeks from the date of the diagnosis/prognosis. The point, in other words, is that the entitlement to family medical leave is based on a reasonably imminent risk of death and not on any particular date specified by the practitioner, so long as the date is within 26 weeks.
Also note the effect of s. 49.1(5) which sets out the latest day an employee can remain on leave. This is either the last day of the week in which the employee’s family member dies, or the last day of a 52 week period starting on the first day of the week in which the 26-week period referred to in s. 49.1(2) begins. Continuing with the example from above, assume that the spouse did not die within six weeks of the date indicated on the certificate; he died 40 weeks after the date indicated on the certificate. The latest date the employee can remain on leave (assuming the employee has not yet used up the full 28 week entitlement), is, pursuant to s. 49.1(5), the last day of the 40th week in the 52-week period, which, in this example, began on Sunday, June 27. If the spouse did not die, the latest date the employee could be on leave pursuant to the same certificate would be Saturday, June 25 of the following year. Note that in both cases, the employee would not be required to get a new certificate within the 52-week period running from the first day of the week in which the original certificate was issued, even if the spouse lived past the original period of 26 weeks established by the certificate – see section 49.1(5.1).
This policy also has implications for determining when the further leave provision of s. 49.1(11) can be engaged. Assume, in this same example, that the spouse did not die within six weeks of the date indicated on the certificate, and was still alive after 52 weeks. The employee would be required to wait until the end of that first 52-week period before a second certificate could be issued that would make the employee eligible for a second 28 weeks of leave. See section 49.1(11) below.
At the time of writing, no shorter period than 26 weeks has been prescribed.
This section lists the individuals, referred to in s. 49.1(2), for whom an employee is entitled to take a family medical leave.
The list is exhaustive. If the person is not listed in s. 49.1(3), the employee has no entitlement to family medical leave.
At the time of writing, no additional family members have been prescribed.
Employees who wish to access family medical leave employment insurance benefits for a person that is “like a family member” may be required to submit a document to the federal government from the ill individual attesting that the person consider the employee to be like a family member. Pursuant to Ontario Regulation 535/17, section 1, employees wishing to take family medical leave for a person who considers the employee to be like a family member must provide their employer at the employer's request with a copy of this document. At the time of writing, the document required by the federal government was the Compassionate Care Benefits Attestation form, which is available from Employment and Social Development Canada (“ESDC”). However, whether or not the employee is applying for EI benefits or required to submit the form for EI purposes does not affect the requirement to provide it for family medical leave purposes under the ESA 2000.
Employees wishing to take a family medical leave to provide care or support to any other family member specified in s. 49.1(3) are not required to provide their employer with a completed attestation form.
Note that spouse includes married same-sex couples, married opposite-sex couples, and couples of the same or opposite sex who live together in a conjugal relationship outside marriage – see the definition of spouse and the discussion at Employment Standards Act Part XIV, section 45.
Also note that the family members specified for the purposes of section 49.1(2) in section 49.1(3) do not have to live in Ontario in order for the employee to be eligible for family medical leave.
This provision establishes the earliest date a family medical leave can begin.
The earliest date family medical leave can begin is the first day of the week in which the 26-week period referred to in s. 49.1(2) begins; that is, the first day of the 26-week period within which the family member has a significant risk of dying. Pursuant to the definition of week in s. 49.1(1), the first day of the 26-week period referred to in s. 49.1(2) will always be Sunday.
For example, a doctor issues a certificate on Wednesday, June 30, stating that an individual (who is the employee's mother) has a serious medical condition and is at significant risk of death within 26 weeks from that date. The 26-week period referred to in s. 49.1(2) actually begins on Sunday, June 27, and ends 26 weeks later. Accordingly, the earliest date the employee's leave can begin is Sunday, June 27.
Another example is where the doctor issues the certificate on Saturday, July 10, indicating that an individual (who is the employee's father) has a serious medical condition and was at significant risk of death from Wednesday, June 30. In this case, the 26-week period referred to in s. 49.1(2) also begins on Sunday, June 27. Accordingly, the earliest date the employee's leave can begin is also Sunday, June 27.
This provision establishes the latest date an employee can remain on family medical leave. It must be read in conjunction with s. 49.1(2) and (6), which determine the maximum length of the leave. It may also be read in conjunction with section 49.1(5.1) which provides clarifying information about the certificate requirement.
The latest date an employee can remain on family medical leave is the earlier of:
The last day in either case will always be a Saturday, pursuant to the definition of week in s. 49.1(1).
The following examples illustrate the application of s. 49.1(5).
A doctor issues a certificate on Wednesday, June 23, stating that the employee's mother has a serious medical condition and is at significant risk of death within 26 weeks from that date.
The 52-week period begins on Sunday, June 20, and ends 52 weeks later, which is Saturday, June 18.
The mother dies on Tuesday, November 16.
The latest date the employee can remain on leave is Saturday, November 20. Further, pursuant to s. 52.1, if the employee was on leave during the week that started Sunday, November 14, the employee is allowed to return to work before Saturday, November 20 only if the employer agrees (whether or not in writing). See Employment Standards Act, Part XIV, section 52.1 for a discussion.
A doctor issues a certificate on Wednesday, June 23, stating that the employee's mother has a serious medical condition and is at significant risk of death within 26 weeks from that date.
The 52-week period begins on Sunday, June 20 and ends 52 weeks later, on Saturday June 18.
The mother is still alive on January 1 (28 weeks after the issuance of the first certificate).
The latest date the employee can remain on leave is Saturday, June 18. The employee does not need to arrange for a new certificate to be issued at the end of the original 26-week period specified in the certificate and remains eligible to be on leave for the duration of the 52-week period, until such point as the entire 28 week entitlement of leave is used – see section 49.1(5.1)
A doctor issues a certificate on Saturday, July 10, indicating that the employee's father has a serious medical condition and was at significant risk of death from Wednesday, June 23
The 52-week period begins on Sunday, June 20, and ends 52 weeks later, on Saturday, June 18.
The father is still alive on Saturday, June 18.
The latest date the employee can remain on leave is Saturday, June 18.
Note, however, that after June 18, the employee may be entitled to a further leave – see ection 49.1(11), discussed below.
This subsection clarifies that it is not necessary for an employee to arrange for a qualified health practitioner to issue a second certificate within the same 52-week period running from the issuance of the first certificate, if all the requirements for the leave continue to be met, e.g., the ill family member is still alive, still has a serious medical condition and a significant risk of death, and the employee has not yet used the maximum entitlement of 28 weeks of leave.
This section provides that where more than one employee takes family medical leave under s. 49.1 with respect to the same family member, the 28 week leave entitlement must be shared by the employees.
There is no requirement that the employees who are sharing the leave entitlement be on leave at the same time, or at different times; the Employment Standards Act, 2000 does not impose any restrictions in this regard.
Note that the entire weeks provisions of s. 49.1(7) and section 52.1(2) also apply in the context of section 49.1(6). If one of the employees sharing the leave entitlement takes only three days off in one week, that employee is deemed to have taken an entire week of leave, thereby reducing the total number of weeks of leave remaining for all employees who are taking leave for the same family member by one week.
Note also that the sharing requirement applies only where two or more employees take leave under this section, i.e., section 49.1. An employee who takes a leave similar to family medical leave pursuant to a contractual provision that provides a greater right than s. 49.1, and which thus prevails over s. 49.1 under Employment Standards Act Part III, section 5(2), is not taking leave under this section; therefore the amount of leave that that employee takes does not reduce the amount of leave that other employees can take in respect of the same family member under s. 49.1. Likewise, an employee who takes a leave similar to Employment Standards Act, 2000 family medical leave pursuant to the employment standards legislation of another jurisdiction is not taking leave under this section. Thus, if a father facing a significant risk of death within 26 weeks has one child in Ontario and another child in Manitoba, any leave taken by the latter under Manitoba's legislation to provide care or support to the father would not affect the amount of leave available to the child in Ontario.
Subsection 49.1(6) also provides that where more than one certificate is issued by a qualified health practitioner(s) with respect to the same individual and the certificates set out different 26-week periods, the 26-week that defines the start of the 52-week period within which leave may be taken will be the one specified in the first certificate that was issued.
This provision must be read in conjunction with s. 49.1(1), which defines week as seven consecutive days beginning on Sunday and ending on Saturday, and with s. 52.1, which was introduced into the ESA 2000 effective October 29, 2014 and which states:
While there is no requirement that the 28 weeks of family medical leave that an employee is entitled to be taken consecutively, s. 49.1(7) does specify that the leave must be taken in periods of entire weeks.
Despite this entire weeks requirement, the Program's view prior to the coming-into-force of Employment Standards Act Part XIV, section 52.1 on October 29, 2014 was that the right to be on leave was contingent on the employee actually providing care or support to the ill family member; this meant that if an employee was not providing care or support for some part of a week, the employee had no right to be on leave during that part and they were both required to be and entitled to be at work during that part. Thus, if an employee was only going to begin providing care or support on, say, a Wednesday, they had no right to begin their leave before Wednesday and the employer could not require him or her to start the leave before that day. Likewise, if an employee who was on leave stopped providing care or support after, say, Tuesday, they had no right to stay on leave after Tuesday; they had no right to continue on leave after that day and the employer could insist that they return to work for the rest of the week. Notwithstanding this, the Program took the position that because of the section 49.1(7) entire weeks requirement, the employee in these situations would be deemed to have used up one full week of their total family medical leave entitlement. However, with the coming-into-force of Employment Standards Act Part XIV, section 52.1, the Program has had to modify its position insofar as the situation where the employee who is on leave stops providing care or support part-way through a week is concerned.
Accordingly it is now Program policy that:
The employee is considered to have used up a week of their 28-week entitlement even if they are not on leave for the entire week. Note that there is no change from previous policy, based on subsection 49.1(7).
Although an employee is considered to have used up a week of their 28-week entitlement even if not actually off work for the entire week, they are entitled to be paid for the time that was actually worked, and the hours that were worked will be counted for the purposes of, among other things, determining whether or not the relevant overtime threshold has been reached or limits on hours of work per week have been exceeded.
Where an employee takes more than one single day of leave during the same week as defined in s. 49.1(1), only one week of leave will be deemed to have been used up. For example, if an employee takes a single day of leave on Tuesday, May 29, wants to and is permitted by the employer to return to work on May 30 and 31, and takes another single day of leave on Friday, June 1, only one week will be deemed to have been used up, because those two days fell within the same week.
An issue arises as to whether an employer has the option of not deeming an entire week of leave to be used up when an employee is away from work for only part of a week. The employment standard provides that a full week of leave will be charged against the employee's 28-week entitlement. However, pursuant to the greater right or benefit provision of Employment Standards Act Part III, section 5(2), if what the employer provides amounts to a greater right or benefit than the employment standard, then what the employer provides will supplant the employment standard and will apply instead of the employment standard. Accordingly, the employer is not prevented from charging only part weeks' leave against the employee's 28-week entitlement if the entire family medical leave package provided by the employer amounts to a better deal for the employee than s. 49.1.
Subsection 49.1(8) requires employees to tell their employers ahead of time that they will be taking family medical leave. In circumstances where that cannot be done, s. 49.1(9) requires the employee to tell the employer as soon as possible after beginning the leave. In either case, this must be done in writing. Note that the ESA 2000 does not require the employee to specify a return date.
The requirement to advise the employer in writing applies with respect to each part of their 28-week leave.
An employee takes the available 28-week leave in four separate blocks: six weeks, ten weeks, and two further blocks of six weeks each. The employee is required to advise the employer in writing that they will be taking leave before (or as soon as possible after, if the notice cannot be given before the leave begins) each individual block of leave begins. The notice can be given at four separate times - once before each individual block (or, if notice cannot be given ahead of time, as soon as possible after the beginning of each block). Or, if the employee knows the start dates of all of the individual blocks of leave ahead of time, a single written notice setting out the dates would meet this requirement.
An employee takes eight one-day leaves. The employee must advise the employer in writing before (or as soon as possible after) each single day of leave is taken. This is so even if some of the single days are taken in the same we. The notice can be given at separate times, or, if the employee knows the start dates of more than one single day of leave ahead of time, a single notice setting out the multiple dates is sufficient notice for each of those dates.
An employee does not lose their right to family medical leave if they fail to comply with ss. 49.1(8) or (9). An employee's entitlement to family medical leave arises by virtue of meeting the eligibility criteria in s. 49.1(2), and it is the Program's position that the failure to advise the employer before or as soon as possible after the leave begins does not negate that entitlement. This approach is consistent with the Program's long-standing policy for all leaves contained in Part XIV where the structure of the entitlement and notice provisions are similar to these. See for example ESA Part XIV, ss. 46(4), 48(4) and 50(3) and (4).
The question may arise as to whether an employer can penalize an employee for failing to give advance notice that they will be absent from work (as may be required under an employer policy), where the time off is a family medical leave under the ESA 2000. Section 49.1(9) provides that if the employee must begin the leave before advising the employer, the employee shall advise the employer of the leave in writing as soon as possible after beginning it. It is thus clear that the ESA 2000 contemplates that circumstances may arise where the employee would be unable to advise the employer in advance of starting family medical leave and that the employee nevertheless has the right to take the leave in such circumstances (although the employee does have an obligation to advise the employer of the leave as soon as possible after starting it). On the other hand, the failure to give notice in advance of taking leave when the employee could have done so can be the subject of disciplinary action by the employer without violating s. 74. However the following points should be borne in mind:
This section provides that if the employer asks the employee for a copy of the certificate referred to in s. 49.1(2), the employee is required to provide it to the employer as soon as possible.
The certificate referred to in section 49.1(2) is the certificate issued by a qualified health practitioner that states that an individual has a serious medical condition with a significant risk of death occurring within a period of 26 weeks – see section 49.1(2) above.
An employee's failure to conform to the statutory requirement to provide a copy of the certificate does not disentitle him or her to the family medical leave. It is the Program's view that the requirement to provide a copy of the certificate is not a condition precedent to the entitlement to family medical leave; the conditions for entitlement are set out in section 49.1(2). However, as provided in section 49.1(2), in order to be entitled to the leave, the employee must obtain a certificate. The leave may begin before the certificate is obtained, but the employee must eventually obtain a certificate in order to be entitled to the leave. If they do not eventually obtain a certificate, they are not entitled to the leave.
This section provides for the right of an employee to take a further family medical leave of up to 28 weeks if the family member does not die within the 52-week period referred to in section 49.1(2).
For example, a doctor issues a certificate on Wednesday, June 30, stating that an individual (who is the employee's mother) has a serious medical condition and is at significant risk of death within 26 weeks from that date. Pursuant to section 49.1(2), the 52-week period begins on Sunday, June 27, and ends 52 weeks later, which is Saturday, June 25. The employee takes a 28-week family medical leave from July to February. The mother is still alive on Sunday, June 26. As of June 26, the employee may be entitled to take a second family medical leave of up to 28 weeks, if the eligibility criteria of section 49.1(2) are again satisfied by the employee. In particular, the employee will again be required to obtain a certificate from a qualified health practitioner stating that the mother has a serious medical condition with a significant risk of death occurring within a period of 26 weeks.
An employee could be entitled to a third, fourth, etc. family medical leave of up to 28 weeks after the expiry of each 52-week period, so long as the employee satisfies the eligibility criteria of section 49.1(2) a third, fourth, et cetera time.
This section also stipulates what happens where there is a further leave where:
In this case, the 52-week period (which establishes the period during which the leave may be taken) for the purposes of the further leave will be determined using the first certificate that was issued after the end of the first 52-week period.
The Fair Workplaces, Better Jobs Act, 2017, SO 2017, c 22 amended section 49.1 on January 1, 2018. Among other changes, the amendments extended the maximum period of family medical leave from eight weeks to 28 weeks. The timeframe within which the weeks of leave may be taken was also extended from 26 to 52 weeks.
Subsection 49.1(13) sets out transitional rules that apply with respect to the January 1, 2018 amendments. If an employee is relying on a certificate issued prior to January 1, 2018 to support their entitlement to a leave, then section 49.1 as it read on December 31, 2017 will apply to that employee. If an employee is relying on a certificate issued on or after January 1, 2018, the current provisions apply.
This section contains definitions of four terms that are used in the organ donor leave provisions.
"Legally qualified medical practitioner" is referred to in subsection 49.2(4), 49.2(6) and 49.2(8). Where the surgery for the purpose of organ donation is taking place in Ontario, doctors who are members of the College of Physicians and Surgeons of Ontario are the only individuals who fall within the definition of legally qualified medical practitioner. Where the surgery takes place outside of Ontario, persons who are qualified to practise medicine under the laws of that jurisdiction are the only individuals who fall within the definition of legally qualified medical practitioner.
"Organ" for the purposes of organ donor leave is defined as the kidney, liver, lung, pancreas, small bowel or any other organ that is prescribed for the purpose of this section. At the time of writing, there are no other organs prescribed.
"Organ donation" for the purposes of organ donor leave includes the donation of all or part of an organ to a person.
"Prescribed" means prescribed by a regulation made under section 49.2 regarding organ donor leave.
This section provides that references to "organ" in the organ donor leave provisions would also apply to tissue that is prescribed by regulation for the purposes of these provisions. At the time of writing, there are no prescribed tissues.
To be eligible for organ donor leave, the employee has to have been employed for at least 13 weeks prior to the commencement of the leave and undergo surgery for the purpose of organ donation. It is not necessary that the employee be actively working for all or any part of the 13 weeks prior to commencing the leave. For example, the employee could be off receiving short-term disability benefits, on a Part XIV leave, on vacation or on lay-off during the qualifying period.
In addition, to be eligible for the leave, the employee must be undergoing surgery for the purpose of organ donation which includes the donation of all or part of an organ to a person. For the purposes of organ donor leave, "organ" has been defined as the kidney, liver, lung, pancreas, small bowel or any other organ that is prescribed for the purpose of this section. As of the time of writing, no other organs have been prescribed.
If requested by the employer, an employee who takes an organ donor leave would have to provide a certificate issued by a legally qualified medical practitioner confirming that the employee will be undergoing or has undergone surgery for the purpose of organ donation.
See discussion of the term "legally qualified medical practitioner" in subsection (1) above.
Eligible employees are entitled to take a period of up to 13 weeks of unpaid organ donor leave. As with parental leave, Program policy is that employees must take organ donor leave in one continuous period. There is a regulation making authority to vary the maximum leave period and to prescribe different leave periods with respect to the donation of different organs and prescribed tissue. At the time of writing, there are no other leave periods prescribed.
This subsection provides for the right of an employee to extend the organ donor leave, subject to s. 49.2(7), if the employee is not yet able to perform the duties of his or her position because of the organ donation. In order to extend the leave, the employee is required to obtain a certificate from a legally qualified medical practitioner stating that he or she is not yet able to perform the duties of his or her position because of the organ donation and will not be able to do so for a specified period of time. The length of the extension to organ donor leave is subject to s. 49.2(7).
Subsection 49.2(7) permits the original organ donor leave period to be extended more than once for medical reasons, however the total extension period cannot exceed 13 weeks. For example, an employee is near the end of the original 13 weeks of organ donor leave and has not fully recovered from the organ donation to perform the duties of her position. The employee will be able to extend her leave, if her doctor, who is a member of the College of Physicians and Surgeons of Ontario, issues a certificate stating that she is not yet able to perform the duties of her position because of the organ donation and will not be able to do so for a period of time. If at the end of the additional period of time of organ donor leave, the employee is still unable to perform the duties of her position, the leave may again be extended if her doctor issues another certificate. However, the total period of time for these extensions cannot exceed 13 weeks. Therefore, where the leave is extended, the maximum amount of time allowed for organ donor leave is 26 weeks in total.
Generally, organ donor leave will begin on the date of the surgery but it may begin on an earlier date as specified in a certificate issued by a legally qualified medical practitioner.
Subject to section 49.2(10) (where an employee extends the leave in accordance with subsection 49.2(6)) and 49.2(11) which set out where an employee may end the leave early), organ donor leave will end when the prescribed period has expired or 13 weeks after it began. At the time of writing, there are no other leave periods prescribed. Therefore, organ donor leave will end 13 weeks after it began, subject to subsection 49.2(10) and 49.2(11).
If an employee has extended an organ donor leave in accordance with section 49.2(6), the leave would end the earlier of:
At the time of writing, there have been no leave periods that have been prescribed. Therefore, where there has been an extension to organ donor leave, the leave would end on the earlier of the day specified in the most recent medical certificate or 26 weeks after the leave began.
Section 49.2(11) provides that organ donor leave may end earlier than provided in section 49.2(9) or section 49.2(10) if the employee gives the employer at least two weeks' written notice before the day the employee wishes to end the leave.
In contrast to the Program's position with respect to the notice requirements to commence the leave, the Program's position is that the employer can refuse to allow the employee to return to work earlier than the date provided for in section 49.2(9) or 49.2(10) if the employee has not given the employer two weeks' notice in writing.
An employee who wishes to take organ donor leave or wishes to extend an organ donor leave is required to give at least two weeks' notice in writing to the employer of his or her intention to take or extend an organ donor leave. In circumstances where that cannot be done, the employee is required, pursuant to s. 49.2(13), to advise the employer as soon as possible after beginning or extending the leave.
The employee is required to advise the employer in writing.
The Employment Standards Act, 2000 requires that the employee advise the employer that he or she will be beginning or extending a leave; it does not require the employee to specify a return date.
An employee does not lose his or her right to organ donor leave if he or she fails to comply with ss. 49.2(12) or (13). An employee's entitlement to organ donor leave arises by virtue of meeting the eligibility criteria in s. 49.2(3), and it is the Program's position that the failure to advise the employer before or as soon as possible after the leave begins or is extended does not negate that entitlement. This approach is consistent with the Program's long-standing policy for all leaves contained in Part XIV where the structure of the entitlement and notice provisions is similar to those relating to organ donor leave. See for example, Employment Standards Act, Part XIV, section 46(4) and section 48(4).
This section provides that if the employer requires a certificate referred to in subsection 49.2(4), (6) or (8), the employee is required to provide it to the employer as soon as possible.
The certificate referred to in ss. 49.2(4), (6) or (8), is the certificate issued by a legally qualified medical practitioner as defined in s. 49.2(1) stating either:
An employee's failure to conform to the statutory requirement to provide a copy of the certificate does not disentitle him or her to the organ donor leave. It is the Program's view that the requirement to provide a certificate is not a condition precedent to the entitlement to organ donor leave; the conditions for entitlement are set out in section 49.2(3).
Where care or treatment is provided in Ontario:
Where care or treatment is provided in a jurisdiction other than Ontario, the question of whether the person providing it is a qualified health practitioner is determined with reference to the laws of that other jurisdiction.
At the time of writing, there are no prescribed circumstances or prescribed classes of health practitioners.
"Week" means a period of seven consecutive days beginning on Sunday and ending on Saturday. For the purposes of family caregiver leave, week will always be Sunday to Saturday, even if the employer's work week is different.
These subsections provide for an entitlement to family caregiver leave if the eligibility requirements set out in the subsections are met.
Employees are entitled to take up to eight weeks of family caregiver leave in each calendar year with respect to each specified family member. Week is defined in section 49.3(1) as being a period of seven consecutive days beginning on Sunday and ending on Saturday.
Nothing in the Employment Standards Act, 2000 requires that the weeks of family caregiver leave be taken consecutively. Further, unlike the case with family medical leave, the Employment Standards Act, 2000 does not require that family caregiver leave be taken in periods of entire weeks. However, where an employee takes any part of a week as leave, section 49.3(7.1) permits the employer to deem the employee to have taken one full week of leave. In other words, there are eight weeks in which the employee may take leave and thus where an employee takes any time off during a week as family caregiver leave – even as little as one day – they may be considered to have used up one week of their eight weeks of entitlement.
Additionally, because the Employment Standards Act, 2000 does not require that family caregiver leave be taken in periods of entire weeks, Employment Standards Act Part XIV, section 52.1 – which applies only to leaves that must be taken in entire weeks – does not apply.
Section 52.1, which applies to family medical leave (since that leave must be taken in periods of entire weeks) provides that an employee who ceases to provide care or support before the end of a week is entitled to stay on family medical leave for the rest of the week, and can return to work before the end of the week only if the employer agrees. In contrast, in the case of family caregiver leave, because section 52.1 does not apply, an employee who ceases to provide care or support before the end of a week is required to return to work and the employer has no right to prevent the employee from returning to work.
Accordingly, it is Program policy that the entitlement to family caregiver leave is as follows:
There is no limit on the number of family members for whom family caregiver leave can be taken per calendar year. If, for example, an employee has two specified family members who have a serious medical condition, the employee will be entitled to two family caregiver leaves of up to eight weeks each. The timing and duration of each leave, the notice requirements, etc., are governed by section 49.3 independently of one other.
Note that the Employment Standards Act, 2000 does not require that family caregiver leave entitlements be pro-rated for part-time employees or employees who started their employment partway through a calendar year.
Because week is defined as running from Sunday to Saturday, the question arises as to how to attribute family caregiver leave absences when a week crosses over into the next calendar year. Specifically, what happens if an employee is on a family caregiver leave during such a week, on at least one day before the end of the calendar year and on at least one day into the new calendar year. For example, an employee takes family caregiver leave from Sunday, December 28 to Saturday, January 3. Because the family caregiver leave entitlement is on a calendar year basis, it is Program policy that in this situation, the employee is considered to have used up one of their eight weeks of leave entitlement for the calendar year that is ending AND one of their eight weeks of leave entitlement for the calendar year that is beginning.
The family caregiver leave entitlement is for providing care or support to the family member with the serious medical condition. This includes, for example, providing psychological or emotional support to the family member, assisting the family member with regular household chores (e.g., housekeeping, laundry, shopping) as well as arranging for care by a third party provider, and directly providing or participating in the personal care of the family member. Care or support also includes assisting the family member to get their affairs in order, where, for example, the family member is at risk of death.
Employees are entitled to family caregiver leave with respect to the family members listed in section 49.3(5). See section 49.3(5) below.
An employee is eligible for family caregiver leave if a qualified health practitioner issues a certificate stating that the individual has a serious medical condition.
See the discussion of this term in section 49.3(1) above.
Because section 49.3(2) uses the present tense "issues" (as opposed to "has issued"), an employee may begin a family caregiver leave before a certificate is issued.
For example, an employee might obtain the certificate soon after beginning the leave, or after the leave is over, or — if the employer engages in a reprisal against the employee – soon after the reprisal or when asked to by an employment standards officer during the course of a reprisal investigation. In all of these cases, because a certificate was ultimately issued, the employee will be considered to have fulfilled this eligibility criterion. However, if the employee never does obtain a certificate, they will not have an entitlement to family caregiver leave.
The employee may wish to use the Ministry's "Medical Certificate to Support Entitlement to Family Caregiver Leave, Family Medical Leave, and/or Critical Illness Leave" form when obtaining the medical certificate. It is available on the Ministry of Labour's website.
A medical certificate will authorize absences as protected family caregiver leave absences (up to eight weeks per calendar year) from the date it is issued until the end of the calendar year in which it was issued. However, if the certificate sets out a period over which the individual has/will be expected to have a serious medical condition that is different from the period between the date it is issued to the end of the calendar year, the period set out in the certificate determines the period over which absences can be protected as family caregiver leave.
The period in the certificate could:
The certificate must name the individual and state that they have a serious medical condition. Pursuant to s. 49.3(3), a serious medical condition includes a condition that is chronic or episodic. There is no requirement that the note specify what the medical condition is; it need only indicate that it is "serious".
It is for the health practitioner, and no one else, to make an assessment as to whether the individual's medical condition is serious; if they issue a certificate stating that the individual has a serious medical condition, the s. 49.3(2) requirement is fulfilled. In other words, it is not an employment standards officer's role to determine whether the individual does in fact have a serious medical condition.
It is Program policy that a certificate will not satisfy the eligibility criteria if it names or describes the medical condition without explicitly stating that it is serious. Note, however, that nothing in the ESA 2000 prevents the employee in question from returning to the health practitioner and obtaining another certificate that does state that the family member concerned has a medical condition that is serious. It is Program policy that this eligibility criterion will be met if the certificate does not contain the word “serious” but instead contains words that are synonymous with the notion that the individual could die or is expected to die. Although there is no requirement that the individual be expected to die in order for the employee to have an entitlement to family caregiver leave, this policy recognizes that any illness or injury that causes or could cause the individual to die is serious. So, for example, if the certificate contains the words "life-threatening" or "terminally ill", or something else that is synonymous with the expectation that the individual could die or is expected to die, this criterion will be met.
An employee's entitlement to family caregiver leave is in addition to any entitlement the employee may have with respect to the same relative to family medical leave, critical illness leave, personal emergency leave, child death leave, crime-related child disappearance leave, and domestic or sexual violence leave. A single certificate may satisfy the requirements for a certificate under more than one leave. For example, a single certificate that indicates that a named individual has a serious medical condition with a significant risk of death occurring within a period of 26 weeks will satisfy the requirements for both family medical leave (which is available only if the individual has a serious medical condition with a significant risk of dying within 26 weeks) and family caregiver leave; an employee is not required to obtain separate certificates for each leave if the wording used in a single certificate meets the requirements for both leaves.
This subsection lists the individuals for whom a family caregiver leave can be taken; the list of individuals mirrors the list of individuals with respect to whom personal emergency leave may be taken.
The list is exhaustive. If the person who has the serious medical condition is not an individual referred to in s. 49.3(5), the employee will not be entitled to take family caregiver leave in respect of that person.
The terms "parent" (which indirectly expands the ordinary meaning of child) and "spouse" are defined in ESA Part XIV, section 45.
With respect to paragraph 7, "a relative of the employee who is dependent on the employee for care or assistance" in paragraph 7, see the discussion of this phrase in Employment Standards Act Part XIV, section 50. Section 50 deals with the personal emergency leave provisions, which use the same phrase.
Paragraph 8 refers to "any individual prescribed as a family member for the purpose of this section". At the time of writing no individuals have been prescribed.
Section 49.3(6) requires employees to tell their employers ahead of time that they will be taking family caregiver leave. In circumstances where that cannot be done s. 49.3(7) requires the employee to tell the employer as soon as possible after beginning the leave. In both cases, the employee is required to advise the employer in writing.
The Employment Standards Act, 2000 requires that the employee advise the employer that they will be beginning a leave; it does not require the employee to specify a return date.
The requirement to advise the employer in writing applies with respect to each part of their eight-week leave.
An employee takes the available eight-week leave in two separate four-week blocks. The employee is required to advise the employer in writing that they will be taking leave before (or as soon as possible after, if the notice cannot be given before the leave begins) each four-week block of leave begins. The notice can be given at two separate times, once before each four-week block (or, if notice cannot be given ahead of time, as soon as possible after the beginning of each four-week block). Or, if the employee knows the start dates of both four-week blocks of leave ahead of time, a single written notice setting out the dates would meet this requirement.
An employee takes eight one-day leaves. The employee must advise the employer in writing before (or as soon as possible after) each single day of leave is taken. This is so even if some of the single days are taken in the same week. The notice can be given at separate times, or, if the employee knows the start dates of more than one single day of leave ahead of time, a single notice setting out the multiple dates is sufficient notice for each of those dates.
An employee does not lose their right to family caregiver leave if they fail to comply with ss. 49.3(6) or (7). An employee's entitlement to family caregiver leave arises by virtue of meeting the eligibility criteria in s. 49.3(2), and it is the Program's position that the failure to advise the employer before or as soon as possible after the leave begins does not negate that entitlement. This approach is consistent with the Program's long-standing policy for all leaves contained in Part XIV where the structures of the entitlement and notice provisions are similar to these. See for example ss. 46(4) (pregnancy leave) and 48(4) (parental leave) in Part XIV.
The question may arise as to whether an employer can penalize an employee for failing to give advance notice that they will be absent from work (as may be required under an employer policy) where the time off is a family caregiver leave under the ESA 2000. Section 49.3(7) provides that "if the employee must begin the leave before advising the employer, the employee shall advise the employer of the leave in writing as soon as possible after beginning it." It is thus clear that the ESA 2000 contemplates that circumstances may arise where the employee would be unable to advise the employer in advance of starting family caregiver leave and that the employee nevertheless has a right to take the leave in such circumstances (although the employee does have an obligation to advise the employer of the leave as soon as possible after beginning it). On the other hand, the failure to give notice in advance of taking leave when the employee could have done so can be the subject of disciplinary action by the employer without violating section 74. However, the following points should be borne in mind:
For employees who are entitled to family responsibility leave as provided for in section 50.0.1, questions have arisen as to whether an employee who is absent from work for one of the events listed in section 50.0.1(1) in relation to a person specified in section 50.0.1(3) must use one of their three days of family responsibility leave.
Subsection (8) provides that where an employee takes a paid or unpaid leave of absence under an employment contract in circumstances for which the employee would also be entitled to take a leave under section 50.0.1, the employee is deemed to have taken a leave under section 50.0.1. Subsections (9) and (10) establish rules that apply to the deemed leave.
Accordingly, if subsections (8)-(10) apply to an absence, i.e. an employee takes paid or unpaid leave under the contract of employment in circumstances in which family responsibility leave could be taken, the employee will be deemed pursuant to subsection 50(8) to have taken ESA family responsibility leave and drawn down against the three-day section 50.0.1 entitlement. (See the discussion under subsection 50 (8)–(10) for more information regarding the impact of contractual entitlements on the statutory right to family responsibility leave.)
On the other hand, if subsections (8)-(10) do not apply, that is, an employee who is entitled to family responsibility leave is absent due to one of the reasons listed in section 50.0.1(1) but does not take a paid or unpaid leave of absence under an employment contract for that absence (either because the employee does not have a contractual right or does not exercise it), it is the employee (not the employer) who decides whether to designate the absence as a statutory family responsibility leave.
If the employee who is entitled to family responsibility leave and who is absent from work due to one of the reasons listed in section 50.0.1(1) wishes to designate the absence as a statutory family responsibility leave, then the absence is a family responsibility leave that draws down against the three-day statutory entitlement and attracts the corresponding reprisal protections (and all of the other ancillary rights that attach to statutory leaves that are set out in subsection 51-53.1)
In the case where subsection (8)-(10) do not apply, an employee may be entitled to statutory family responsibility leave and be absent from work due to one of the reasons listed in section 50.0.1(1) in relation to a person specified in section 50.0.1(3) and decide not to claim the absence as a family responsibility leave day. This is not considered as contracting out of the Employment Standards Act, 2000 if an employee does not take advantage of their leave entitlements; the employee has merely chosen not to exercise them.
If the employee who is entitled to family responsibility leave by virtue of being absent from work due to one of the reasons listed in section 50.0.1(1) in relation to a person specified in section 50.0.1(3) does not wish to designate the absence as a family responsibility leave, and the absence cannot be considered an authorized absence on some other ground (for example, another leave under the Employment Standards Act, 2000 or vacation authorized by the employer), the absence would have no statutory reprisal protection. For this reason, an employee who takes a day off for a reason that would qualify under section 50.0.1 but who would prefer not to have the day charged against their family responsibility leave allotment may feel effectively forced into designating the day as such a leave. This in itself does not constitute any violation of the Employment Standards Act, 2000: it is not unlawful for an employer to inform an employee that should the employee not designate an absence as a statutory family responsibility leave day, then it would be considered an unexcused absence that will lead to disciplinary action.
Note that if the employee did not know of the right to take family responsibility leave, the default is that the absence is considered to be statutory family responsibility leave with the corresponding reprisal protection. An employee does not lose their right to any of the leaves provided for under the Employment Standards Act, 2000 because they were unaware of their entitlements.
The Fair Workplaces, Better Jobs Act, 2017, SO 2017, c 22 added this provision to section 49.3 on January 1, 2018.
The provision must be read in conjunction with section 49.3(1), which defines week as seven consecutive days beginning on Sunday and ending on Saturday.
Employees may not need an entire work week to provide the care or support that gave rise to the family caregiver leave, and will only take part of a week off as family caregiver leave. Section 49.3(7.1) allows an employer in this situation to count the part-week off work as an entire week's leave for the purpose of the eight-week leave entitlement. This is the only purpose for which the employer can deem the part work week as an entire week's leave. It cannot deem the employee not to have worked at all during the week. The employee is entitled to be paid for the time that was actually worked, and the hours that were worked will be counted for the purposes of, among other things, determining whether the relevant overtime threshold has been reached, whether the limits on, for example, the daily and weekly hours of work have been reached, and whether the daily, weekly/bi-weekly and in-between shifts rest requirements have been met.
Where an employee takes more than one single day of leave during the same week as defined in section 49.3(1), the employer may deem only one week of leave to have been used up. For example, if an employee takes a single day of leave on Tuesday, May 29, returns to work on May 30 and 31, and takes another single day of leave on Friday, June 1, only one week will be deemed to have been used up, because those two days fell within the same week.
Note that while this provision allows the employer to deem the employee to have taken one week of leave if the employee takes part of a week as leave, it does not require the employer to do so.
The issue may arise as to whether an employer could exercise its discretion and deem a partial week absence as a full week for some employees, but not for others, or whether this might allow employers to selectively punish employees who have too many absences in violation of the reprisal provisions of the Employment Standards Act, 2000.
The answer will depend on the facts. In particular, why did the employer treat the employees differently? Where an employer deems a full week's absence for some Employment Standards Act, 2000.
For instance, if the employer counts a one-day family caregiver leave as a full week's leave for Employee A but not for Employee B, who also takes a one-day family caregiver leave because the employer considers Employee B to be a better worker than Employee A, this might be unfair as between employee A and B, but it would not be a violation of the Employment Standards Act, 2000, as it would not be reprisal for exercising a right under the Employment Standards Act, 2000. If, on the other hand, the motivation for the differential treatment was that Employee A frequently took family caregiver leave of only a few days, and the employer assigned a full week's absence to these short leaves as a way to ensure Employee A used up all of their statutory entitlement as soon as possible because the employer found it inconvenient for the employee to be away for many short periods of time, that would be an unlawful reprisal.
This section provides that if the employer asks the employee for a copy of the certificate referred to in section 49.3(2), the employee is required to provide it to the employer as soon as possible.
The certificate referred to in section 49.3(2) is the certificate issued by a qualified health practitioner that states that an individual has a serious medical condition.
An employee's failure to conform to the statutory requirement to provide a copy of the certificate does not disentitle him or her to the family caregiver leave. It is the Program's view that the requirement to provide a copy of the certificate is not a condition precedent to the entitlement to family caregiver leave; the conditions for entitlement are set out in section 49.3(2). However, as provided in section 49.3(2), in order to be entitled to the leave, the employee must obtain a certificate. The leave may begin before the certificate is obtained, but the employee must eventually obtain a certificate in order to be entitled to the leave. If they do not eventually obtain a certificate, they are not entitled to the leave.
This section defines six terms used in the critical illness leave provisions.
An “adult” is defined as an individual who is 18 years or older. An employee who meets the eligibility requirements in section 49.4(5) will be entitled to a leave of up to 17 weeks per section 49.4(6) to provide care or support to a critically ill adult.
In order for an employee to be entitled to a critical illness leave, the employee must be providing care or support to a critically ill minor child or adult who is a family member of the employee. “Minor child”, “adult” and “family member” are defined terms.
"Critically ill" is defined, with respect to a minor child or adult, to mean the minor child or adult’s baseline state of health has significantly changed and whose life is at risk as a result of an illness or injury.
"Baseline state of health" (or of wellness) is a medical term and it is for a qualified health practitioner (also a defined term) to make the assessment as to whether a minor child or adult’s "baseline state of health has significantly changed". This same phrase appears in the federal government's policy statement regarding eligibility for "special benefits" for parents of critically ill children under the Employment Insurance Act, SC 1996, c 23, and consistent with the federal government's policy. The Program takes the position that the phrase is intended to exclude a minor child or adult with a chronic illness or condition that is their normal state of health, even if that normal state is considered to be life-threatening in the medium to long term.
However, when an employment standards officer is making a determination as to whether an employee was entitled to critical illness leave, the issue with respect to the critically ill criterion is simply whether a qualified health practitioner has issued a certificate that meets the requirements of section 49.4(2) or (5); the officer does not inquire as to whether the person in question was one "whose baseline state of health has significantly changed and whose life is at risk as a result of an illness or injury". See the discussion under the heading "Stating that the minor child or adult family member is critically ill". In other words, if a qualified health practitioner has issued such a certificate, the officer does not "go behind it" and make inquiries as to whether the practitioner was actually justified in doing so.
This definition lists the individuals for whom an employee is entitled to take a critical illness leave. The list is exhaustive. If the minor child or adult is not in a relationship with the employee as listed in the definition, the employee has no entitlement to critical illness leave. Note that there are two types of critical illness leave, one for a minor child “who is a family member” of the employee, and one for an adult “who is a family member” of the employee. With respect to a critical illness leave for a minor child, the minor child does not have to be the employee’s own child in order for the employee to be entitled to the leave; for example, an employee could take a leave to care for a niece, nephew or grandchild who meets the definition of minor child (see below).
Section 49.4(1) defines the following individuals as family members:
Note that "spouse" includes married same-sex couples, married opposite-sex couples, and couples of the same or opposite sex who live together in a conjugal relationship outside marriage – see the definition of spouse and the discussion at Employment Standards Act, Part XIV, section 45.
Also note that the family members as defined by s. 49.4(1) do not have to live in Ontario in order for the employee to be eligible for critical illness leave.
With respect to “a person who considers the employee to be like a family member”, the legislation provides that if any conditions are set out in regulation, those conditions must be met. Ontario Regulation 535/17 section 1 prescribes the following condition: “the employee must, on the employer’s request, provide the employer with a copy of the document provided to an agency or department of the Government of Canada for the purpose of claiming benefits under the Employment Insurance Act (Canada) in which it is stated that the employee is considered to be like a family member.”
The employee must provide a copy of this document whether or not the employee applies or intends to apply for Employment Insurance benefits to support critical illness leave. See Ontario Regulation 535/17 section 1 for more details.
At this time, there are no additional family members that have been prescribed.
In order to be considered a minor child for the purpose of entitlements to critical illness leave, the individual must have been under 18 years of age on the first day of the period during which the child requires care or support as indicated in the certificate issued by the qualified health practitioner. The fact that the critically ill individual turns 18 years old after the first day of this period does not extinguish the employee's right to the 37 weeks of leave. Also see subsections (13) and (14) below in this section for guidance on the situation where an employee takes a leave in relation to a minor child who turns 18 during the leave.
In order for an employee to be entitled to critical illness leave, a "qualified health practitioner" must issue a certificate stating that the minor child or adult is critically ill and requires the care or support of one or more family members and setting out the period during which the minor child or adult requires the care or support. The term "qualified health practitioner" is defined for the purposes of critical illness leave as:
Where care or treatment is provided in Ontario:
Where care or treatment is provided in a jurisdiction other than Ontario the question of whether the person providing it is a qualified health practitioner is determined with reference to the laws of that other jurisdiction.
At the time of writing, there are no prescribed circumstances or prescribed classes of health practitioners.
"Week" means a period of seven consecutive days beginning on Sunday and ending on Saturday. For the purposes of critical illness leave, week will always be Sunday to Saturday, even if the employer's work week is different.
This subsection provides for an entitlement to critical illness leave in respect of a minor child if the eligibility requirements set out in the subsection are met (note the entitlement provisions with respect to a critical illness leave for an adult are set out in subsection (5) below).
To be eligible for critical illness leave, the employee has to have been employed for at least six consecutive months prior to the first day of the leave. It is not necessary that the employee have been actively working for the six-month period, so long as they were an employee during this time. For example, the employee could have been off receiving short-term disability benefits, on vacation, or on layoff during this period. The employee could also be on another statutory leave, including, for example, a family caregiver leave to care for the critically ill minor child during the period.
Critical illness leave under subsection (2) is for providing "care or support" to the critically ill minor child who is a family member of the employee. Care or support could include, for example, providing psychological or emotional support to the child, or providing or participating in their personal care. The care or support must be provided to a critically ill minor child (i.e. an individual under 18) who is a family member of the employee. This could be the employee’s child but is not limited to this relationship. It could be taken for any of the relationships listed in the definition of family member in s. 49.4(1) such as the employee’s grandchild, niece, nephew etc.
An employee is eligible for critical illness leave if a qualified health practitioner issues a certificate stating that a minor child who is a family member of the employee is critically ill and requires the care or support of one or more family members, and setting out the period during which the child requires the care or support.
See the discussion of this term at subsection (1) above.
Because section 49.4(2) uses the present tense "issues" (as opposed to "has issued"), an employee may begin a critical illness leave before a certificate is issued.
For example, an employee might obtain the certificate soon after beginning the leave, or after the leave is over, or — if the employer engages in a reprisal against the employee — soon after the reprisal or when asked to by an employment standards officer during the course of a reprisal investigation. In all of these cases, because a certificate ultimately was issued, the employee will be considered to have fulfilled this eligibility criterion. However, if the employee never does obtain a certificate, they will not have an entitlement to critical illness leave.
The employee may wish to use the Ministry's "Medical Certificate to Support Entitlement to Family Caregiver Leave, Family Medical Leave, and/or Critical Illness Leave" form when obtaining the medical certificate. It is available on the Ministry of Labour's website.
If an employee is applying for Employment Insurance (EI) benefits in respect of the same critically ill minor child, a copy of the medical certificate submitted to Employment and Social Development Canada may also be used for the purposes of critical illness leave.
The certificate must name the minor child, and indicate that they are critically ill (or, given the section 49.4(1) definition of critically ill, that they have been critically injured). There is no requirement that the certificate specify what the illness (or injury) is; it need only indicate that it is critical.
It is for the health practitioner, and no one else, to make an assessment as to whether the minor child is critically ill (see the discussion of the definition of critically ill in subsection (1) above). If they issue a certificate stating that the minor child is a critically ill (or injured) minor child, the section 49.4(2) requirement is fulfilled. In other words, it is not an employment standards officer's role to determine whether the minor child is in fact critically ill or injured.
It is Program policy that a certificate will not satisfy the eligibility criteria if it states what illness or injury the minor child has without also stating that the minor child is a critically ill or critically injured minor child (or that the illness or injury from which the minor child is suffering is critical). This is so even if the certificate names an illness or injury that sounds critical. (Note, however, that nothing in the Act prevents the employee in question from returning to the health practitioner and obtaining another certificate that does state that the minor child is a critically ill – or injured – minor child, or that the illness or injury from which the child is suffering is critical). It is Program policy that this eligibility criteria will be met if the certificate doesn’t contains the words critically ill (or critical illness) or critically injured (or critical injury) but instead contains words that are synonymous with the notion that the child's life is at risk. So, for example, if the certificate contains the words "life threatening", "terminally ill", or something else that is synonymous with the expectation that the child could die or is expected to die, this criterion will be met. Furthermore, it is Program policy that the eligibility criteria will be met if the certificate doesn’t contain the specific words minor child but instead references only a child where some other evidence is available to establish that the child is under the age of 18, or where the age of the individual is contained in the certificate and they are under 18 years of age.
An employee's entitlement to critical illness leave is in addition to any entitlement the employee may have with respect to the same child to family medical leave, family caregiver leave, personal emergency leave, and child death leave, crime-related child disappearance leave, domestic or sexual violence leave and personal emergency leave. A single certificate may satisfy the requirements for a certificate under more than one leave. An employee is not required to obtain separate certificates for each leave if the wording used in a single certificate meets the requirements for more than one leave.
The certificate must state that the critically ill (or injured) minor child requires the care or support of at least one family member. Family member is a defined term.
The certificate must set out the period during which the minor child requires the care or support of one or more family members. The period would typically be described by specifying a start date and an end date. However, in some cases it may not be possible to specify an end date, and in other cases it may be that the health practitioner does not foresee the child ever recovering. Recognizing this, the Program takes the position that it is acceptable if the certificate, instead of specifying an end date, states that care or support will be required indefinitely or that it will be required to the end of the minor child's life.
This subsection establishes what the critical illness leave entitlement is under subsection (2): up to 37 weeks of leave to provide care or support to the critically ill minor child who is a family member of the employee: up to 37 weeks of leave .
The subsection must be read in conjunction with section 49.4(14), which provides for additional leaves in certain circumstances.
Nothing in the Act requires that the weeks of critical illness leave be taken consecutively. Further, unlike the case with family medical leave, the Act does not require that critical illness leave be taken in periods of entire weeks. However, because the critical illness leave entitlement is expressed in terms of a number of weeks, rather than a number of days (as is the case with personal emergency leave), it is Program policy that the entitlement is that there are 37 weeks in which the employee may take leave and thus where an employee takes any time off during a week as critical illness leave – even as little as one day – they are considered to have used up one week of their 37 weeks of entitlement.
Additionally, because the Act does not require that critical illness leave be taken in periods of entire weeks, section 52.1 of the Act – which applies only to leaves that must be taken in entire weeks – does not apply. footnote 2
In summary, it is Program policy that the entitlement to critical illness leave in relation to a minor child who is a family member of the employee is as follows:
This subsection must be read in conjunction with other relevant subsections of s. 49.4, particularly (4)(8)(9)-(10), (16) and (19) which address the following issues/scenarios:
While subsection (3) provides that an employee is entitled to take up to 37 weeks of critical illness leave to provide care or support to a critically ill minor child, subsection (4) provides an exception where the medical certificate indicates that the number of weeks during which the minor child will require care or support is a number less than 37 weeks. In that case, the employee can only take a leave for the number of weeks indicated. (Note, however, that if the minor child is still critically ill and in need of care or support after the period specified in the certificate has expired, the employee may be eligible for a further leave pursuant to subsection (14)).
This subsection establishes what the critical illness leave entitlement is under subsection (5): up to 17 weeks of leave to provide care or support to the critically ill adult who is a family member of the employee.
The subsection must be read in conjunction with section 49.4(15), which provides for additional leaves in certain circumstances.
Nothing in the Act requires that the weeks of critical illness leave be taken consecutively. Further, unlike the case with family medical leave, the Act does not require that critical illness leave be taken in periods of entire weeks. However, because the critical illness leave entitlement is expressed in terms of a number of weeks, rather than a number of days (as is the case with personal emergency leave), it is Program policy that the entitlement is that there are 17 weeks in which the employee may take leave and thus where an employee takes any time off during a week as critical illness leave – even as little as one day – they are considered to have used up one week of their 17 weeks of entitlement.
Additionally, because the Act does not require that critical illness leave be taken in periods of entire weeks, section 52.1 of the Act – which applies only to leaves that must be taken in entire weeks – does not apply.
In summary, it is Program policy that the entitlement to critical illness leave in relation to an adult who is a family member of the employee is as follows:
This subsection must be read in conjunction with other relevant subsections of section 49.4, particularly (7)-(10), (15) and (19) which address the following issues/scenarios:
While subsection (6) provides that an employee is entitled to take up to 17 weeks of critical illness leave to provide care or support to a critically ill adult, subsection (7) provides an exception where the medical certificate indicates that the number of weeks during which the adult will require care or support is a number less than 17 weeks. In that case, the employee can only take a leave for the number of weeks indicated (note, however, that if the adult is still critically ill and in need of care or support after the period specified in the certificate has expired, the employee may be eligible for a further leave pursuant to subsection (15)).
These subsections establish the latest date an employee can remain on critical illness leave; in other words, they set out the date the window for taking a critical illness leave closes. These subsections must be read in conjunction with the provisions that set out the maximum length of the leave, which is 37 weeks in relation to a minor child, and 17 weeks in relation to an adult. These subsections must also be read in conjunction with subsections (9) and (10), which establish the latest date an employee can remain on leave if the minor child or adult dies while the employee is on leave. In addition, regard should be had to subsections (14), (15) and (16); those subsections provide for further leaves if a critically ill minor child or adult remains critically ill.
The general rule is that an employee's right to be on leave ends on the last day of the period the minor child or adult requires care or support as specified in the certificate issued by the qualified health practitioner.
If the certificate states that the minor child or adult requires care or support for a period of 52 weeks or longer, the employee's right to be on leave ends on the last day of the 52-week period that starts the earlier of:
Pursuant to subsection (9), the employee's right to be on leave will end on the last day of the 52-week period that starts the first day of the week the child became critically ill.
The definition of a week is a period of seven consecutive days beginning on Sunday and ending on Saturday (see section 49.4(1)).
Accordingly:
Note, however, that while the right to be on the leave ends on Saturday, February 1, the employee may qualify for an additional leave after the original leave ends, in accordance with subsection (16).
This subsection establishes the latest date an employee can be on critical illness leave if the critically ill minor child or adult for whom the leave was taken dies. In effect, it establishes an exception to the rules regarding the last day an employee can be on leave that are established by subsections (8) and (9).
Subsection (10) provides that if an employee is on critical illness leave and the minor child or adult dies, the employee's right to be on leave ends at the end of the week (which, in accordance with the definition of a week in section 49.4(1), will be a Saturday) in which the person dies.
Note that if an employee’s minor child dies, the employee will generally be entitled to take child death leave per section 49.5. In other cases, the employee may be entitled to take personal emergency leave if the individual who dies is an individual listed in section 50(2).
Under subsection (11) and (12), the maximum amount of leave available to an employee or employees in respect of the same minor child or adult who is critically ill is 37 weeks in relation to a minor child, and 17 weeks in relation to an adult.
Where more than one employee takes critical illness leave with respect to the same person the 37 or 17 week maximum (whichever applies) has to be shared by the employees. The employees who are sharing the leave can be on leave at the same time, or at different times; the Act does not impose any restrictions in this regard (the sharing requirement applies whether or not the employees work for the same employer).
The sharing requirement applies only where the two or more employees take leave under this section, i.e., section 49.4 of the Employment Standards Act, 2000. An employee who takes a leave similar to critical illness leave pursuant to a contractual provision that provides a greater right than section 49.4 (which thus prevails over section 49.4 pursuant to section 5(2) of the Employment Standards Act, 2000) is not taking leave under this section; therefore the amount of leave that employee takes does not reduce the amount of leave that other employees can take in respect of the same minor child or adult under section 49.4.
Likewise, an employee who takes a leave similar to Employment Standards Act, 2000 critical illness leave pursuant to the employment standards legislation of another jurisdiction is not taking leave under this section. So, for example, if one family member of a critically ill minor child works in Ontario and the other family member works in, say, Manitoba, and they each take critical illness leave to care for the minor child pursuant to their respective provincial employment standards statutes, the Ontario employee has the full 37-week leave entitlement; they will not have to share the 37 weeks with the other family member.
Note that in accordance with principles of statutory interpretation, section 49.4 (11) and (12), like other subsections in section 49.4, must be read within the context of section> 49.4 as a whole; it does not, therefore, displace the limits set out in "section 49.4(4) and (7). Section 49.4(4) states that if the certificate issued by the qualified health practitioner specifies the number of weeks the critically ill minor child will require care or support as a number less than 37, then it is that number of weeks of leave (and not 37 weeks) that the employee will be entitled to. Section 49.4(7) performs the same function for a certificate issued in relation to a critically ill adult that provides a lesser number of weeks than 17. Simply put, section 49.4(11) and (12) do not give an employee or employees a longer period of leave than the period specified in the certificate where that period is less than 37 weeks for a minor child or 17 weeks for an adult.
Lastly, subsections (11) and (12) also apply with respect to any additional leaves taken under subsections (14) or (15). Subsection (14) allows for additional leaves of up to 37 weeks after each 52-week period described in subsection (9) for a minor child, if the eligibility criteria are met for a second, third, etc. time. Subsection (15) allows for additional leaves of up to 17 weeks after each 52-week period described in subsection (9) for an adult, if the eligibility criteria are met for a second, third, etc. time.
Subsection (13) below addresses the situation where a minor child turns 18 within 52 weeks of the certificate issuance and for whom the full 37 weeks of leave have not been taken.
This subsection addresses the scenario where an employee begins a leave in relation to a minor child who turns 18 before the full entitlement to the leave is taken. In this case, the employee will be entitled to take the full duration of the original 37-week leave, but will not be entitled to a leave under subsection (5) until the original limitation period established by subsection (9) has expired.
For example, if a certificate is issued under subsection (2) on Thursday, January 5th, the 52-week period described in subsection (9) will start on Sunday, January 1. If the minor child turns 18 on March 1, the employee remains entitled to take up to 37 weeks of leave within the 52-week period between January 1 and December 31. However, if the employee uses all 37 weeks by September 30, and the now-adult family member remains critically ill, the employee will have to wait until January 1 for a new certificate to be issued under subsection (5) and become entitled to a new leave of 17 weeks in relation to a critically ill adult.
In general terms, subsection (14) is meant to result in an appropriate solution where the health practitioner's certificate that was originally issued did not accurately predict (i.e. underestimated) the period during which the minor child would require care or support.
Subsection (14) addresses the situation where a minor child remains critically ill and requires care or support beyond the period specified in the certificate, but only up to the end of the 52-week period (subsection (16) addresses the situation where a minor child remains critically ill beyond the 52 weeks. In general terms, subsection (16) permits employees to take additional leaves of up to 37 weeks in subsequent 52-week periods).
This subsection – subsection (14) – addresses the situation in which:
In this situation, section 49.4(14) allows the employee to do so, subject to certain limitations:
An employee does not become ineligible for a further leave pursuant to subsection (14) solely because the minor child turned 18 before a subsequent certificate is issued.
The employee in this situation will be entitled to a further leave, despite the fact that the individual in respect of whom the leave is being taken is 18 years old (and no longer falls within the definition of a minor child in section 49.4) at the point the employee is qualifying for a further leave. Note that subsection (13) will not prevent an employee from becoming eligible to take further leave under subsection (14). As stated above, subsection (14) is meant to result in an appropriate solution where the health practitioner's certificate underestimated the period during which the child or children require care or support. Had the first certificate accurately predicted the period of care or support, the employee would have been eligible for leave until June 1. Note, however, that an employee will be ineligible for an additional leave pursuant to subsection (16) if the child is 18 years old at the time the employee is attempting to qualify for an additional leave. This is because subsection (16), unlike subsection (14), provides that “the requirements of this section apply” to the additional leave, and this includes the requirement that the individual in respect of whom the employee wants to take the leave meet the definition of minor child by being under 18 years of age. In that case, the employee could qualify for a new, shorter 17 week leave on the basis of a certificate issued pursuant to subsection (5), but the employee would need to wait until the original 52-week period started by the issuance of the most recent certificate had elapsed per subsection (13).
There is no limit to the number of extensions or new leaves an employee is entitled to under section 49.4(14), but the subsection does limit the total number of weeks of leave that can be taken in the 52-week period to no more than 37 weeks and requires that the end of the leave or leaves be no later than the last day of the 52-week period that begins on the earlier of (a) the first day of the week in which the first certificate was issued and (b) the first day of the week in which the minor child became critically ill. Note, however, that this does not prevent an employee from taking additional leaves under subsection 49.4(16) after the 52-week period expires.
In this scenario, the employee would be entitled to take critical illness leave pursuant to subsection (2) during the four week period of January 1 to January 28, and a "further" four-week leave pursuant to subsection (14) during the period January 29 to February 25.
This provides the employee the same entitlement they would have had if the first certificate accurately predicted the period the child would require care or support.
In this scenario, the employee would be entitled to take critical illness leave pursuant to subsection (2) during the 30-week period January 1 to July 29, and a further leave pursuant to subsection (14) during the 10-week period July 30 to October 6. However, pursuant to paragraph (b) of subsection (14), the employee is only entitled to be on leave for a maximum of 37 weeks during that 40-week period.
In general terms, subsection (15) is meant to result in an appropriate solution where the health practitioner's certificate that was originally issued did not accurately predict (i.e. underestimated) the period during which the adult would require care or support.
Subsection (15) addresses the situation where an adult remains critically ill and requires care or support beyond the period specified in the certificate, but only up to the end of the 52-week period. (Subsection (16) addresses the situation where an adult remains critically ill beyond the 52 weeks. In general terms, subsection (16) permits employees to take additional leaves of up to 17 weeks in subsequent 52-week periods).
This subsection – subsection (15) – addresses the situation in which:
In this situation, section 49.4(15) allows the employee to do so, subject to certain limitations:
There is no limit to the number of extensions or new leaves an employee is entitled to under section 49.4(15), but the subsection does limit the total number of weeks of leave that can be taken in the 52-week period to no more than 17 weeks and requires that the end of the leave or leaves be no later than the last day of the 52-week period that begins on the earlier of (a) the first day of the week in which the first certificate was issued and (b) the first day of the week in which the adult became critically ill. Note, however, that this does not prevent an employee from taking additional leaves under subsection 49.4(16) after the 52-week period expires.
In this scenario, the employee would be entitled to take critical illness leave pursuant to subsection (5) during the four week period of January 1 to January 28, and a further four-week leave pursuant to subsection (15) during the period January 29 to February 25.
This provides the employee the same entitlement they would have had if the first certificate accurately predicted the period the child would require care or support.
In this scenario, the employee would be entitled to take critical illness leave pursuant to subsection (5) during the 10-week period January 1 to March 11, and a further leave pursuant to subsection (15) during the 10-week period March 12 to May 20. However, pursuant to paragraph (b) of subsection (15), the employee is only entitled to be on leave for a maximum of 17 weeks during that 20-week period.
In general terms, this subsection addresses the situation where a minor child or adult is still critically ill 52 weeks or more after first developing a critical illness. It provides that employees are able to re-qualify for additional critical illness leave(s) of up to 37 weeks for a minor child or up to 17 weeks for an adult in subsequent 52-week periods.
Subsection (16) provides that if an employee took critically ill child care leave for a minor child or an adult, and the person remains critically ill after the end of the 52-week period described in subsection (9) (that is, the 52-week period that begins on the earlier of (a) the first day of the week in which the first certificate was issued and (b) the first day of the week in which the minor child or adult became critically ill), the employee is entitled to take another critical illness leave if they again meet the requirements of section 49.4 (see subsection (9) above for details regarding the 52-week period).
Note that if a minor child or adult that was critically ill develops a new critical illness, the employee will be entitled to another critically ill child care, critical illness leave. However, the entitlement will arise simply by virtue of meeting the qualifying condition in section 49.4(2) or (5); the entitlement does not arise from subsection (13) (since it only applies to employees whose child remains critically ill) and, accordingly, the restrictions in subsection (13) as to the earliest date an additional leave may be taken do not apply with respect to a leave taken because of a new, subsequent critical illness. This means that, for example, if an employee who took leave for the first 37 weeks in a 52-week period to care for a minor child and then that same minor whose child develops developed a new critical illness in week 40 will, the employee would, assuming the qualifying criteria of subsection (2) are met, be entitled to begin a new leave as of week 40. There is no upper limit to the number of additional leaves an employee is entitled to under this subsection. After each 52-week period described above elapses, if the minor child or adult the employee has taken leave in relation to remains critically ill, then the employee may qualify for a fresh critical illness leave by again meeting the requirements of section 49.4.
One of the requirements of section 49.4(2) is that the individual in respect of whom the employee wants to take the leave is under 18 years of age. Accordingly, an employee is not eligible for an additional leave under that subsection if the individual in respect of whom the employee wants to take the leave is, at the time the eligibility for an additional leave is being assessed, already 18 years of age – in that case, the employee may qualify for a new leave under subsection (5) but will be subject to the requirements of subsection (13) However, an employee will be eligible for a further leave pursuant to subsection (14) even if the individual is 18 years at the time the employee is trying to qualify for a further leave. This is because, unlike subsection (16), subsection (14) does not provide that “the requirements of this section apply” to the further leave (see subsection (14) above).
Each additional leave an employee is entitled to is governed by the restrictions of section 49.4 as they pertain to that additional leave. For example, the provisions regarding when the leave must end, what happens if a minor child or adult dies, the total amount of each leave in subsections (11) and (12), eligibility for a further leave under subsections (14) and (15) and eligibility for more additional leaves under subsection (16).
Note that subsections (11) and (12) apply each time an employee takes a leave under this section and any additional leaves must be shared if they are taken by more than one employee in relation to the same critically ill person. In other words, an employee is entitled to no more than 37 weeks of leave (for a minor child) or 17 weeks of leave (for an adult) with respect to the original leave and to no more than 37 or 17 weeks of leave with respect to each additional leave in subsequent 52 week periods. There is no cap on the number of leaves (each of which may be up to 37 or 17 weeks in a 52-week period) an employee may be entitled to.
S. 49.4(17) requires employees to advise their employers in writing before starting the leave that they will be taking critical illness leave. This subsection also requires employees to, before starting the leave, provide a written plan setting out the weeks in which the leave will be taken. Where employees will be taking some of the leave in single days, the requirement is that the written plan must indicate the weeks in which the leave will be taken; it need not indicate which days in those weeks.
In circumstances where the employee cannot advise the employer before the leave commences, the employee is required, pursuant to section 49.4(18), to advise the employer (in writing) and provide the written plan as soon as possible after beginning the leave.
If an employee wants to take a leave at a time other than that indicated in the plan, the employee has to meet the requirements of subsection (19).
An employee does not lose their right to critical illness leave if they fail to comply with subsection 49.4(17) or (18). An employee's entitlement to critical illness leave arises by virtue of meeting the eligibility criteria in section 49.4(2) or (5), and it is the Program's position that the failure to advise the employer before or as soon as possible after the leave begins or the failure to provide a written plan does not negate that entitlement. This approach is consistent with the Program's long-standing policy for all leaves contained in Part XIV where the structures of the entitlement and notice provisions are similar to these. See for example Employment Standards Act, Part XIV, subsection 46(4) (pregnancy leave) and 48(4) (parental leave).
The question may arise as to whether an employer can penalize an employee for failing to give advance notice that they will be absent from work (as may be required under an employer policy), where the time off is a critical illness leave under the Act. Section 49.4(18) provides that "if an employee must begin a leave before advising the employer, the employee shall advise the employer of the leave in writing as soon as possible after beginning it." It is thus clear that the Act contemplates situations where the employee would be unable to advise the employer in advance of starting the leave and that the employee nevertheless has a right to take leave in such situations (although the employee does have an obligation to advise the employer of the leave as soon as possible after beginning it). On the other hand, the failure to give notice in advance of taking leave, when the employee could have done so, can be the subject of disciplinary action by the employer without violating section 74. However, the following points should be borne in mind:
This subsection provides that once an employee provides the employer with a written plan that indicates the weeks in which they will take the leave, as required by subsection (17) or (18), the employee is permitted to deviate from that plan only if:
Examples of the employee's circumstances that may impact on how much advance notice of the change is reasonable include:
An example of the employer's circumstances that may impact on how much advance notice of the change is reasonable is the cost and disruption of having to accommodate the change in plans, for example, if the employer hired a long-term replacement for an employee who originally advised he would be on leave for 37 consecutive weeks but now wishes to return to work after 15 weeks and alternate weeks of leave with weeks at work, the amount of advance notice of the change required would be greater than if the employer had not hired a replacement.
It is the Program's position that the employer can refuse to allow the employee to deviate from the dates provided in the original written plan if neither condition set out in clause (a) or (b) are met.
The requirements of these subsections apply whenever the employee is deviating from the plan. This includes, for example, situations where the employee gave the employer a written plan that advised that she will be on leave for the next two weeks, but which was silent about any other dates or advised that more leave would be taken in the future but that the dates are yet unknown and will be provided in the future. Taking leave beyond those initial two weeks is a change in the employee's plan; accordingly, the requirements of paragraph (a) or (b) will apply.
An employee can make multiple changes to their written plan, so long as they meet the requirements of paragraph (a) or (b) each time.
Subsection (19) does not apply if the change to the dates of the leave is required by the Employment Standards Act, 2000 itself. For example, if the employee advised the employer that he would be on leave for 37 consecutive weeks but the minor child dies in the 15th week, the Act (section 49.4(10)) provides that the leave ends at the end of the week in which the minor child dies. The employee is entitled to return to work at the end of that week – the employee does not have to meet the requirements of subsection (19) in order to return to work at the end of that week.
This section provides that if the employer asks the employee for a copy of the section 49.4(2), (5), (14) or (15) certificate (i.e., a certificate issued by a qualified health practitioner that states that a minor child or an adult is a critically ill minor child or adult who requires care or support and that sets out the period during which the person requires the care or support), the employee is required to provide it as soon as possible.
This subsection applies to all of the certificates referred to in section 49.4. For example, if an employee takes a further leave under subsections (14) or (15) or an additional leave under subsection (16) and accordingly obtained a second, third, fourth, etc. certificate, the employee is required to provide the employer with a copy of any subsequent certificate that is requested by the employer.
An employee's failure to provide a copy of the certificate does not disentitle them to critical illness leave. It is the Program's view that the requirement to provide a copy of the certificate is not a condition precedent to the entitlement to critical illness leave; the conditions for entitlement are set out in section 49.4(2) and (5). However, as provided in section 49.4(2) and (5), in order to be entitled to the leave, the employee must obtain a certificate. In other words, while the failure to provide a copy of the certificate to the employer does not disentitle the employee, a failure to have obtained the required certificate will do so.
That is not to say the leave cannot begin before the certificate is obtained. If the employee has not obtained a certificate before commencing the leave, they may do so at a later date and thereby retroactively qualify for the leave. If, for example, an employer penalizes an employee on the basis that they did not have a certificate prior to commencing the leave, such conduct would constitute a reprisal if the employee subsequently obtained the certificate.
The current critical illness leave provisions came into force on December 3, 2017. Prior to this date, section 49.4 was titled “critically ill child care leave” and only employees whose own children were critically ill were eligible for a leave of up to 37 weeks if a qualified health practitioner issued the appropriate certificate.
If an employee has a certificate issued by a qualified health practitioner to support critically ill child care leave, and the certificate was issued before December 3, 2017, then the employee’s leave will be governed by the provisions of section 49.4 as they existed before that day. Note that the employee will be bound by the provisions of the previous leave even if the certificate had been issued, but the employee had not yet commenced the leave on December 3, 2017.
Child death leave came into force on January 1, 2018 as a result of the Fair Workplaces, Better Jobs Act, 2017, SO 2017, c 22 which amended the Employment Standards Act, 2000. The ESA 2000 previously provided a crime-related child death or disappearance leave, which entitled employees who were parents of a child who had disappeared or who died as a probable result of a crime to a leave of absence. If the child of the employee had died as the probable result of crime, the employee was entitled to 104 weeks of leave. If the child of the employee had disappeared as the probable result of a crime, the employee was entitled to 52 weeks of leave. If the child who had disappeared as the probable result of crime was subsequently found dead, the employee was then entitled to 104 weeks of leave running from the time the employee began the original leave.
Child death leave provides the same entitlements for a child’s death as the previous crime-related child death or disappearance leave, although there is no longer a requirement that the child died as a result of (or as a probable result of) a crime. In other words, child death leave can be taken in respect of the death of an employee’s child, no matter the circumstances of the death. Please see s. 49.5(12) below for transitional information relating to a crime-related child death leave that commenced before January 1, 2018.
This section contains definitions of three terms that are used in the child death leave provisions.
For the purpose of the child death leave provisions, a child is the employee's child (which includes an adopted child, even if the adoption proceedings have not been finalized), step-child, foster child or child for whom the employee has been appointed as a legal guardian and who is under 18 years of age.
An employee is not entitled to a leave if the child's death was the result of a crime and the employee has been charged with a crime in relation to the death. Additionally, the employee will not be entitled to a leave if it is probable, considering the circumstances, that the child was a party to a crime in relation to their own death.
"Crime" is defined to mean an offence under the federal Criminal Code, other than offences that are prescribed by regulations that are made under s. 209.4(f) of the Canada Labour Code, RSC 1985, c L-2.
The Canada Labour Code provides for a crime-related child death or disappearance leave if it is probable, considering the circumstances, that the child's death or disappearance was as a result of a crime. Note that the federal leave is similar to the previous crime-related child death or disappearance leave under the ESA 2000. The Canada Labour Code defines crime as an offence under the Criminal Code, and provides that regulations may be made under the Canada Labour Code to exclude some Criminal Code offences from the definition of crime. Any offences that are excluded from the Canada Labour Code's definition of crime through a regulation made under s. 209.4(f) of the Canada Labour Code are similarly excluded from the ESA 2000's definition of crime for the purposes of section 49.5.
"Week" means a period of seven consecutive days beginning on Sunday and ending on Saturday. For the purposes of child death leave, week will always be Sunday to Saturday, even if the employer's work week is different.
Subsection 49.5(2) provides an entitlement for an employee who has been employed by his or her employer for at least six consecutive months to a leave of absence without pay if the employee's child dies. The employee may take a leave of up to 104 weeks.
The question has arisen as to whether an employee who has experienced a still-birth would be entitled to take child death leave. Given that still-births are legally distinct and treated differently than live births and deaths under the Vital Statistics Act (i.e. in the province of Ontario, per Regulation 1094 of the Vital Statistics Act, a death certificate is not issued in the case of a still-birth), it’s Program policy that the answer is no. As such, it is Program policy that an employee would not be eligible to take child death leave in this circumstance. Note, though, that the employee who had the still-birth would — if the stillbirth occurred no more than 17 weeks before the due date — be entitled to take pregnancy leave (which would end either 17 weeks after the leave began, or 12 weeks after the still-birth, whichever day is later — see s. 47(1)(b)). The employee may also be eligible for Sick Leave. Other employees may also be eligible for other leave entitlements — e.g. an employee who is a family member of the employee who had the still-birth may be eligible for Family Responsibility Leave to provide care for the employee who had the still-birth if the eligibility criteria for that leave are met.
Subsection 49.5(3) provides that there is no entitlement to a leave under s. 49.5 if:
Subsection 49.5(4) provides that an employee can take a leave under s. 49.5 only in one single period. A return to work prior to the expiry of the maximum length of the leave would end the entitlement to the leave.
Subsection 49.5(5) provides that the entitlement of up to 104 weeks of leave available under s. 49.5(2) because of the death of a child can be taken only during the 105-week period that begins in the week the child died.
Under section 49.5(6), the maximum amount of leave available to an employee or employees in respect of the same child, or children who died as the result of the same event, is 104 weeks.
Where more than one employee takes leave under s. 49.5(2) because of the death of the same child - or the same children who died as the result of the same event - the 104 week maximum has to be shared by the employees. The employees who are sharing the leave can be on leave at the same time, or at different times; the ESA 2000 does not impose any restrictions in this regard. The sharing requirement applies whether or not the employees work for the same employer.
The sharing requirement applies only where the two or more employees take leave under this section, i.e., s. 49.5 of the ESA 2000. An employee who takes a leave similar to child death leave pursuant to a contractual provision that provides a greater right than s. 49.5, which thus prevails over s. 49.5 under ESA Part III, s. 5(2), is not taking leave under this section; therefore, the amount of leave that employee takes does not reduce the amount of leave that other employees can take in respect of the same child under s. 49.5. Likewise, an employee who takes a leave similar to ESA child death leave under the employment standards legislation of another jurisdiction is not taking leave under s. 49.5. Thus, if one parent of a child who has died works in Ontario and the other parent works in, say, Manitoba, and they each take child death leave pursuant to their respective employment standards statutes, the Ontario employee has the full 104-week entitlement; they will not have to share the entitlement with the other parent.
Subsection 49.5(7) requires employees to advise their employers in writing that they will be taking child death leave, and to provide a written plan setting out the weeks in which the leave will be taken.
This subsection must be read in conjunction with s. 49.5(4), which establishes that a leave under s. 49.5 can be taken only in a single period. In other words, they must provide the start and end dates for the leave.
In circumstances where the employee cannot advise the employer before the leave commences, the employee is required, pursuant to s. 49.5(8), to advise the employer in writing as soon as possible after beginning the leave and to provide the written plan setting out the weeks in which the leave will be taken.
If an employee wants to take a leave at a time other than that indicated in the plan, the employee has to meet the requirements of s. 49.5(9).
An employee does not lose their right to child death leave if they fail to comply with ss. 49.5(7) or (8). An employee's entitlement to child death leave arises by virtue of meeting the eligibility criteria in s. 49.5(2), and it is the Program's position that the failure to advise the employer before or as soon as possible after the leave begins, or the failure to provide a written plan, does not negate that entitlement. This approach is consistent with the Program's long-standing policy for all leaves contained in Part XIV where the structures of the entitlement and notice provisions are similar to these. See for example Employment Standards Act, Part XIV, section 46(4) and section 48(4).
The question may arise as to whether an employer can penalize an employee for failing to give advance notice that they will be absent from work (as may be required under an employer policy) where the time off is a child death leave under the ESA 2000. Section 49.5(8) provides that "if an employee must begin a leave . . . before advising the employer, the employee shall advise the employer of the leave in writing as soon as possible after beginning it." It is clear that the ESA 2000 contemplates situations where the employee would be unable to advise the employer in advance of starting the leave and that the employee nevertheless has a right to take leave in such situations, although the employee does have an obligation to advise the employer of the leave as soon as possible after beginning it. On the other hand, the failure to give notice in advance of taking leave, when the employee could have done so, can be the subject of disciplinary action by the employer without violating Employment Standards Act, Part XVIII, section 74. However, the following points should be borne in mind:
Subsection 49.5(9) provides that once an employee provides the employer with a written plan that indicates the weeks in which they will take the leave, as required by ss. 49.5(7) or (8), the employee is permitted to deviate from that plan only if:
It is the Program's position that the employer can refuse to allow the employee to deviate from the dates provided in the original written plan if neither condition set out in clause (a) or (b) are met.
An employee can make multiple changes to their written plan, so long as they meet the requirements of paragraph (a) or (b) each time.
This subsection must be read in conjunction with s. 49.5(4), which requires that leave under s. 49.5 can be taken only in a single period.
This provision gives an employer some ability to require an employee to provide proof that they are or were entitled to take child death leave. The employer can require an employee to provide evidence that is reasonable in the circumstances that they are or were entitled to take the leave, for example, a death certificate.
If an employee was on a crime-related child death or disappearance leave on December 31, 2017, the employee does not lose the right to continue that leave; an employee in that situation would continue on the leave in accordance with the provisions as they read on that date.
This section contains definitions of three terms that are used in the crime-related child disappearance leave provisions.
For the purpose of the crime-related child disappearance leave provisions, a child is the employee's child (which includes an adopted child, even if the adoption proceedings have not been finalized), step-child, foster child, or child for whom the employee has been appointed as a legal guardian, and who is under 18 years of age.
Employees are entitled to a leave only if, among other things, it is probable, considering the circumstances, that the child's disappearance was the "result of a crime".
Crime is defined to mean an offence under the federal Criminal Code, other than offences that are prescribed by regulations that are made under s. 209.4(f) of the Canada Labour Code, RSC 1985, c L-2.
Like the Employment Standards Act, 2000, the Canada Labour Code provides for a crime-related child disappearance leave if it is probable, considering the circumstances, that the child's disappearance was as a result of a crime. The Canada Labour Code defines crime as an offence under the Criminal Code, and provides that regulations may be made under the Canada Labour Code to exclude some Criminal Code offences from the definition of crime. Any offences that are excluded from the Canada Labour Code's definition of crime through a regulation made under s. 209.4(f) of the Canada Labour Code are similarly excluded from the ESA 2000's definition of crime for the purposes of s. 49.6.
Week means a period of seven consecutive days beginning on Sunday and ending on Saturday. For the purposes of crime-related disappearance leave, week will always be Sunday to Saturday, even if the employer's work week is different.
This subsection provides an entitlement for an employee who has been employed by their employer for at least six consecutive months to a leave of absence without pay if the employee's child disappears and it is probable, considering the circumstances, that the child disappeared as a result of a crime. The employee may take a leave of up to 104 weeks.
Crime is a defined term: see s. 49.6(1) above for details.
The crime-related child disappearance leave provisions came into force on January 1, 2018 as a result of the Fair Workplaces, Better Jobs Act, 2017, which amended the ESA 2000 by dividing the previously existing crime-related child death or disappearance leave into two separate leaves: crime-related child disappearance leave and child death leave. Under the previous crime-related child death or disappearance leave, an employee whose child disappeared as the likely result of a crime was entitled to a leave of 52 weeks. Under the new crime-related child disappearance leave, a leave may be taken for up to 104 weeks.
If the disappearance of a child, which triggers the leave entitlement, occurred prior to January 1, 2018, the employee is entitled to a leave of up to 52 weeks. If the disappearance of a child, which triggers the leave entitlement, occurs on or after January 1, 2018 the employee is entitled to a leave of up to 104 weeks pursuant to s. 49.6(2). Any employee who was on crime-related child disappearance leave as of December 31, 2017 will be entitled to complete the remaining period of the leave (to a maximum of 52 weeks).
Subsection 49.6(4) provides that there is no entitlement to a leave under this section if:
Subsection 49.6(5) provides that if an employee started a leave under s. 49.6 but it subsequently no longer seems probable that the child's disappearance was a result of a crime, the entitlement to leave ends on the day on which it no longer seems probable.
These subsections establish the entitlements where a leave is taken because of the crime-related disappearance of the child and the child is subsequently found.
If the child is found alive in the 104-week period that begins the week the child disappeared, the employee is entitled to remain on leave for 14 days after the day the child is found.
If the child is found dead in the 104-week period that begins the week the child disappeared, the employee is no longer entitled to remain on leave past the end of the week in which the child is found. Note that week is defined in s. 49.6(1). However, s. 49.6(7) explicitly states that the employee’s entitlement to Child Death Leave per s. 49.5 is unaffected by the previous leave taken. So, the employee may be eligible to begin a leave under s. 49.5. Section 49.5 contains provisions requiring the employee to give notice to the employer of their intention to take the leave; however, if the employee cannot give written notice in advance of taking the leave, notice can be given as soon as possible after beginning it. Failure to do so will not disentitle the employee to the leave.
Subsection 49.6(8) provides that an employee can take a leave under s. 49.6 only in one single period. A return to work prior to the expiry of the maximum length of the leave would end the entitlement to the leave.
This subsection provides that, subject to s. 49.6(8), the entitlement of up to 104 weeks of leave available because of the crime-related disappearance of a child can be taken only during the 105-week period that begins in the week the child disappeared. Note that the term week is defined for the purposes of this provision in s. 49.6(1).
Under – section 49.6(10), the maximum amount of leave available to an employee – or employees – in respect of the same child, or children who disappeared as the result of the same event, is 104 weeks.
Where more than one employee takes a leave because of the crime-related disappearance of the same child - or the same children who disappeared as the result of the same event — the 104 week maximum has to be shared by the employees. The employees who are sharing the leave can be on leave at the same time, or at different times; the Act does not impose any restrictions in this regard. The sharing requirement applies whether or not the employees work for the same employer.
The sharing requirement applies only where the two or more employees take leave "under this section" i.e., s. 49.6 of the ESA 2000. An employee who takes a leave similar to crime-related child disappearance leave pursuant to a contractual provision that provides a greater right than s. 49.6, which thus prevails over s. 49.6 under ESA Part III, s. 5(2), is not taking leave under this section; therefore, the amount of leave that employee takes does not reduce the amount of leave that other employees can take in respect of the same child under s. 49.6. Likewise, an employee who takes a leave similar to ESA 2000 crime-related child disappearance leave under the employment standards legislation of another jurisdiction is not taking leave under s. 49.6. Thus, if one parent of a child who has disappeared as a probable result of crime works in Ontario and the other parent works in, say, Manitoba, and they each take crime-related disappearance leave pursuant to their respective employment standards statutes, the Ontario employee has the full 104-week entitlement; they will not have to share the entitlement with the other parent.
Section 49.6(11) requires employees to advise their employers that they will be taking crime-related child disappearance leave, and to provide a written plan setting out the weeks in which the leave will be taken.
This subsection must be read in conjunction with s. 49.6(9), which establishes when the leave may be taken and s. 49.6(8), that provides the leave must be taken only in a single period.
In circumstances where the employee cannot advise the employer before the leave commences, the employee is required, pursuant to s. 49.6(12), to advise the employer in writing as soon as possible after beginning the leave and to provide the written plan setting out the weeks in which the leave will be taken.
If an employee wants to take a leave at a time other than that indicated in the plan, the employee has to meet the requirements of s. 49.6(13).
An employee does not lose their right to crime-related child disappearance leave if they fail to comply with ss. 49.6(11) or (12). An employee's entitlement to crime-related child disappearance leave arises by virtue of meeting the eligibility criteria in s. 49.6(2), and it is the Program's position that the failure to advise the employer before or as soon as possible after the leave begins, or the failure to provide a written plan, does not negate that entitlement. This approach is consistent with the Program's long-standing policy for all leaves contained in Part XIV where the structures of the entitlement and notice provisions are similar to these. See for example ESA Part XIV, s. 46(4) and s. 48(4).
The question may arise as to whether an employer can penalize an employee for failing to give advance notice that they will be absent from work (as may be required under an employer policy) where the time off is a crime-related child disappearance leave under the ESA 2000. Section 49.6(12) provides that "if an employee must begin a leave . . . before advising the employer, the employee shall advise the employer of the leave in writing as soon as possible after beginning it." It is clear that the Act contemplates situations where the employee would be unable to advise the employer in advance of starting the leave and that the employee nevertheless has a right to take leave in such situations (although the employee does have an obligation to advise the employer of the leave as soon as possible after beginning it). On the other hand, the failure to give notice in advance of taking leave, when the employee could have done so, can be the subject of disciplinary action by the employer without violating s. 74. However, the following points should be borne in mind:
This subsection establishes that once an employee provides the employer with a written plan indicating the weeks in which they will take the leave, as required by ss. 49.6(11) or (12), the employee is permitted to deviate from that plan only if:
It is the Program's position that the employer can refuse to allow the employee to deviate from the dates provided in the original written plan if neither condition set out in clause (a) or (b) are met.
An employee can make multiple changes to their written plan, so long as they meet the requirements of paragraph (a) or (b) each time.
This subsection must be read in conjunction with s. 49.6(8), which requires that leave under s. 49.6 can be taken only in a single period.
This provision gives an employer some ability to require an employee to provide proof that they are or were entitled to take crime-related child disappearance leave. The employer can require an employee to provide evidence that is reasonable in the circumstances that they are or were entitled to take the leave.
The domestic or sexual violence leave provisions came into force on January 1, 2018 as a result of the Fair Workplaces, Better Jobs Act, 2017, which amended the Employment Standards Act, 2000. The intention of the section is to provide job-protected leave of up to 10 days and 15 weeks per calendar year to an employee for particular enumerated purposes if the employee or the employee’s child has experienced or been threatened with domestic or sexual violence.
This subsection contains two definitions of terms used in s. 49.7
For the purposes of the domestic violence or sexual violence leave provisions, a “child” means someone who is under 18 years of age and who is the employee’s child (which includes an adopted child, even if the adoption proceedings have not been finalized), step-child, foster child, or child who is under the employee’s legal guardianship.
Note this is the same definition of child used for the purposes of child death leave in ESA Part XIV, s. 49.5(1) and crime-related child disappearance leave in ESA Part XIV, s. 49.6(1).
In order to be considered a child for the purpose of entitlements to domestic or sexual violence leave, the child must be under 18 years of age when they experienced or were threatened with domestic or sexual violence, and when the employee takes the leave for any of the enumerated purposes if the leave is being taken in relation to the child.
“Week” means a period of seven consecutive days beginning on a Sunday and ending on a Saturday. For the purposes of s. 49.7, week will always be Sunday to Saturday even if the employer’s work week is different.
This subsection provides for an entitlement to domestic or sexual violence leave if the eligibility requirements set out in the provision are met.
To be eligible for a domestic or sexual violence leave, the employee must have been employed by the same employer for a minimum of 13 weeks before taking the leave. It is not necessary that the employee have been actively working, so long as they were an employee during this time. For example, the employee could have been off receiving short-term disability benefits, on vacation, or on lay-off, or on a statutory leave during this period.
In order to be eligible for this leave, either the employee or the employee’s child must have experienced or been threatened with sexual or domestic violence. It is Program policy that an employee will be eligible to take the leave even if the incident or threat of domestic or sexual violence occurred prior to January 1, 2018, the coming into force date of this provision, as long as the eligibility requirements (such as length of employment, etc.) are satisfied.
“Domestic or sexual violence” is not a defined term.
However, as a guideline, domestic violence may include physical, emotional or psychological abuse or an act of coercion, stalking, harassment or financial control. A threat of such abuse is also covered by this provision.It may be committed by an employee’s current or former spouse or intimate partner, or between an individual and a child who resides with the individual or between an individual and an adult or child who is related to the individual by blood, marriage, foster care or adoption.
Sexual violence can include acts such as sexual assault, harassment, stalking, indecent exposure, voyeurism, sexual exploitation and sexual solicitation. It can be committed by anyone, whether or not they have any relationship to the employee. A threat of sexual violence is also covered by this provision.
It is Program policy to take an employee’s statement that domestic or sexual violence has occurred or was threatened at face value. In other words, an employment standards officer need not “look behind” the statement to determine whether the violence actually occurred or was threatened. However, note that an employer is entitled to request evidence reasonable in the circumstances to support an employee’s right to take domestic or sexual violence leave for specific defined purposes.
In order to be eligible for a domestic or sexual violence leave, the leave must be taken for one or more of the specific purposes listed in this subsection.
In other words, even though the employee or the employee’s child may have experienced or been threatened with domestic or sexual violence, the employee will not be entitled to take the leave unless it is taken for at least one of the purposes set out above.
Note that in some cases, a single period of leave may be taken for multiple purposes (i.e., counselling provided by a rape crisis centre could be considered to fall under both paragraphs 2 and 3 below). An employee may also take more than one period of leave for a single purpose, for example to attend weekly psychological counselling sessions. And lastly, an employee may take different periods of leave for different purposes, for example to seek medical attention at one point, and to seek legal assistance or participate in a Family Court or criminal trial at a later point in time.
Finally, it should also be noted that where an employee is entitled to take domestic violence or sexual violence leave, the employee (within the constraints imposed under this section) has the right to determine when or if to commence the leave. In other words, the employer does not have the right to schedule a leave for the employee. The employee’s right also effectively overrides an employer’s right to schedule vacation.
As per ESA Part XI, ss. 35 and 35.1, an employer is otherwise entitled to schedule the employee’s vacation time, subject to the limits created by those sections. The Program’s policy concerning an employee’s right to choose when to commence a leave (within the parameters of that specific leave) is consistent with ESA Part XIV, s. 51.1, which applies where there is a conflict between an employer’s obligation to schedule vacation within the time limits set out within the ESA 2000 or where vacation entitlements would be lost under a contract of employment, because of a Part XIV leave. In accordance with that section, any vacation that would otherwise be lost is deferred to the end of the leave.
An employee or their child may need medical attention as a result of physical or psychological injury sustained during an act or threat of domestic or sexual violence. In some cases, there may be an initial treatment and then a follow up visits or treatments at a later date. Medical attention would include, for example, any medical consultation, medical treatment, dental care, rehabilitative therapies such as physiotherapy, massage therapy or chiropractic treatments and consultation with a counsellor, psychologist or psychiatrist as long as the consultations/treatments were related to an original injury caused by domestic or sexual violence.
Services from organizations that assist victims may be provided over a short period of time for initial intake, making referrals, assessment or treatment or longer periods to provide ongoing counselling or assistance with relocation or other practical needs arising from an incident or threat of domestic or sexual violence. For example, meeting with staff at a local shelter to arrange accommodations would be captured under this paragraph. Note, though, that, pursuant to Program Policy, simply residing in a domestic violence shelter, while itself a service contemplated under this paragraph would generally not be considered an act of “obtaining” such a service. Ongoing residency therefore would not generally by itself qualify the employee to take a leave under this paragraph. See the description about relocating below for more details.
A victim services organization might also include a referral service for victims of domestic or sexual violence, a community housing corporation or a community legal aid clinic.
Psychological or other professional counselling may include counselling provided by a psychologist or psychological associate, psychotherapist, family counsellor, relationship counsellor, or social worker. Counselling or treatment by a qualified psychiatrist may also fall under either this purpose, or alternatively under medical attention. Psychological counselling may also include native healing circles or peer support in the form of a group or individual counselling. It is possible that professional counselling may be of a non-medical nature.
Relocating temporarily or permanently may include the process of seeking accommodations, inspecting premises and meeting potential landlords or municipal housing authorities, or going through the intake process at a short or medium-term domestic violence shelter, as well as the actual process of moving furniture and possessions at the point of relocation or at a later date. It could include a period of time in which an employee moves to stay with relatives or friends. It would not include relocating to a new residence with the intimate partner or person who was responsible for the sexual or domestic violence or threat thereof, or relocating if it is unrelated to domestic or sexual violence or the threat thereof.
Seeking legal or law enforcement assistance includes preparing for or participating in any civil or criminal legal proceeding related to or resulting from the violence. As examples, an employee may wish to make a police report, footnote 4 may be required to appear as a witness in a criminal or civil matter or may meet with legal counsel in advance of such a proceeding. An employee may also wish to consult with a lawyer or legal clinic to consider their options without proceeding further, or decide to commence a civil action.
At this time, there are no regulations in force relating to this section and hence no other purposes have been prescribed.
This subsection provides that an employee is not entitled to a domestic or sexual violence leave if the employee committed the domestic or sexual violence (or threatened such action) themselves. Note that a criminal charge does not have to be laid for this subsection to apply.
This subsection creates the entitlement to take leave of up to 10 days (taken intermittently or in a single block) and up to 15 weeks (taken either in single weeks or a continuous period or multiple periods totalling no more than 15 weeks) within a calendar year if an employee meets the eligibility requirements of s. 49.7(2). An employee may take further leaves if the employee qualifies for the leave in a subsequent calendar year.
Note that whenever an employee meets all of the requirements for the leave, i.e. the employee has been employed for at least 13 weeks and the employee or the employee’s child has experienced domestic or sexual violence or the threat thereof and needs to take the leave for any of the enumerated purposes in s. 49.7(2), the employee will be entitled to a maximum of 10 days plus 15 weeks of leave within a calendar year under ss. 49.7(4)(a) and (b).
It is up to the employee to determine which leave is being used in relation to any particular absence, and communicate to the employer, by complying with the notice requirements of s. 49.7(10),(11),(13) and (14), whether they are drawing on the leave entitlement under either s. 49.7(4) clause (a) or (b). For example, if the employee takes a single day of leave and notifies the employer that they are taking the leave under s.49.7(4)(a), the employer is not entitled to deem the absence as an entire week of leave (but can deem a part day as a full day of leave pursuant to s. 49.7(9). Whereas if the employee takes a single day of leave and notifies the employer that they are taking the leave under s. 49.7(4)(b), the employer is entitled to deem the absence as an entire week of leave — see s. 49.7(12).
This section provides that the employee is entitled to be paid for the first five days of domestic or sexual violence leave taken within a calendar year. Any further days or weeks that are taken will be unpaid. The first five days of leave are to be paid whether the employee takes leave per s. 49.7(4)(a) (10 days of leave), or (b) (15 weeks). If an employee normally works a five day week and takes three weeks of leave under s. 49.7(4)(b) and this is the first period of leave to be taken within the calendar year, then the first 5 days of the first week would be paid, while the second and third week would not. Similarly, if in a calendar year, an employee takes three days of leave under s. 49.7(4)(a) in March and two weeks of leave under s.49.7(4)(b) in June, the employee would be entitled to be paid for all three days of the s. 49.7(4)(a) leave in March and the first two days of the s. 49.7(4)(b) leave taken in June.
This section sets out the manner of calculating the amount of domestic or sexual violence leave pay.
Note that, subject to ss. 49.7(7) and (8), the calculation entitles employees only to wages they would have earned if they were at work and not on domestic or sexual violence leave. If an employee takes any part of a day as leave under s. 49.7(4)(a) and the employer deems the employee to have taken one day of leave in accordance with s. 49.7(9), the employer is required to pay domestic or sexual violence leave pay for the time taken as domestic or sexual violence leave (i.e., when the employee is absent) plus any wages the employee earns while actively working during the day in question. The same would apply to situations where an employee takes any part of a week as leave under s. 49.7(4)(b) and the employer deems the employee to have taken one week of leave in accordance with s. 49.7(12).
This provision is also read subject to ss. 49.7(7) and (8). Per s. 49.7(7), overtime pay and shift premium amounts are not to be included in domestic or sexual violence leave pay even if the employee “would have earned” these if the employee worked. Subsection 49.7(8) provides that if a paid day of domestic or sexual violence leave falls on a public holiday, the employee is not entitled to premium pay for any leave taken.
Domestic or sexual violence leave pay for a work day can be any amount from a single hour’s pay or less to an entire day of wages, depending on how much leave is taken.
At this time, no other manner of calculating domestic or sexual violence leave pay has been prescribed.
In order to determine how much domestic or sexual violence leave pay an employee is entitled to, two things need to be established:
If the employee works a regular work day, with set hours, this is the length of the day for the purpose of calculating domestic or sexual violence leave pay.
If the employee is scheduled to work a particular number of hours on the day on which domestic or sexual violence leave is taken, the length of the day will be what was scheduled, even if the employee regularly works a set number of hours that is different from the scheduled shift.
The amount of domestic or sexual violence leave taken on a single day is calculated by deducting the number of hours actually worked, if any, from the total number of hours in the day. For example, if it is determined that the employee was scheduled to work nine hours on the day, and they took five hours to attend a medical appointment and counselling session, they would be entitled to four hours of wages and five hours of domestic or sexual violence leave pay.
If the same employee did not work but took the entire day as domestic or sexual violence leave, they would be entitled to nine hours of domestic or sexual violence leave pay.
For employees who are not paid by performance-related wages:
If the employee is paid by an hourly wage, the amount of domestic and sexual violence leave pay is the number of hours of domestic and sexual violence leave x the hourly rate.
If the employee is paid by salary and has a regular number of days within a pay period and regular hours, the amount of leave pay is
This is, in effect, simple salary continuance. If an employer pays an employee with a fixed salary the normal amount of pay for a week with a day of full or partial domestic or sexual violence leave in it, the domestic or sexual violence leave pay provisions of the ESA 2000 will be satisfied.
Example 1:
Example 2:
The amount of domestic or sexual violence leave pay for an employee paid fully or partly by a system of wage calculation related to performance is the greater of the employee’s “hourly rate, if any” and the minimum wage that would have applied to the employee. Performance-related wages can include commission only, commission plus an hourly wage, piece work, or compensation as a flat-rate mechanic. An hourly rate refers to an hourly rate set by an employment contract.
This section excludes overtime pay or a shift premium (for example, an amount paid or an increase in hourly wage for working evenings or weekends) from inclusion when calculating domestic or sexual violence leave pay. The employee would be entitled to be paid for hours of domestic or sexual violence leave using the “regular” rate of pay, and not for example 1.5 times the regular rate per the overtime provisions of theESA 2000.
Example: Employee scheduled to work overtime hours on a day when domestic or sexual violence leave was taken
Similarly, if an employee is scheduled to work hours that would normally attract a shift premium, and if the employee misses all or some of the shift to take domestic or sexual violence leave, then domestic or sexual violence leave pay will be calculated on the employee’s base rate and would not include the shift premium.
Example: Employee entitled to shift premium pay on a day when domestic or sexual violence leave was taken
Under ESA Part X Public Holidays, employees who agree to, or are required to work on a public holiday may be entitled to receive premium pay of at least one and one half their regular rate for hours worked on that day. The effect of this subsection is that despite the entitlement in s. 49.7(6) to be paid “the wages the employee would have earned had they not taken the leave”, the employee is not entitled to any premium pay that they would have earned by working on the public holiday had the leave not been taken.
For more information on public holiday entitlements, please see ESA Part X.
Employees may or may not need an entire day to attend to the issue that gave rise to the sexual or domestic violence leave. For example, an employee may need only a part day in order to meet with legal counsel to discuss an upcoming legal matter.
Section 49.7(9) allows an employer in this circumstance to count a part day off work as an entire day’s leave for the purpose of the 10 day entitlement where the leave is taken under s. 49.7(4)(a). However, this is the only purpose for which the employer can deem the part day off work as an entire day’s leave. It cannot deem the employee not to have worked at all on the day. The employee is entitled to be paid for the time that was actually worked, and the hours that were worked will be counted for the purposes of, among other things, determining whether the relevant overtime threshold has been reached, whether the limits on, for example, the daily and weekly hours of work have been reached, and whether the daily, weekly/bi-weekly and in-between shifts rest requirements have been met.
Note that this provision allows the employer to attribute one day's leave to a part day of absence, but it does not require the employer to do so.
Note also that the employee is entitled to be on leave only during the time they are engaging in one of the activities enumerated in s. 49.7(2).
Subsection 49.7(10) requires an employee to advise their employer that the employee will be taking domestic or sexual violence leave under s. 49.7(4)(a), which establishes the 10 day portion of the leave. The subsection does not specify that the notice must be writing, and hence, if it is not, the employee will not be disentitled to the leave, oral notice is sufficient.
This subsection provides that where the employee must begin a leave under s. 49.7(4)(a) before providing the employer with the notice otherwise required under s. 49.7(10), the employee must advise the employer as soon as possible after beginning the leave. The subsection does not specify that the notice must be writing, and hence, the notice can be provided orally.
Further, an employee does not lose their right to domestic or sexual violence leave if they fail entirely to comply with ss. 49.7(10) or (11). An employee’s entitlement to domestic or sexual violence leave arises by virtue of meeting the eligibility criteria in s. 49.7(2), and it is the Program’s position that the failure to advise the employer before or as soon as possible after the leave begins does not negate that entitlement. This approach is consistent with the Program’s long-standing policy for all leaves contained in Part XIV where the structures of the entitlement and notice provisions are similar to these.
The question may arise as to whether an employer can penalize an employee for failing to give advance notice that they will be absent from work (as may be required under an employer policy) where the time off is taken as a domestic or sexual violence leave. Section 49.7(11) provides that “if an employee must begin a leave… before advising the employer, the employee shall advise the employer of the leave in writing as soon as possible after beginning it.” It is clear that the ESA 2000 contemplates situations where the employee would be unable to advise the employer in advance of starting the leave and that the employee nevertheless has a right to take leave in such situations, although the employee does have an obligation advise the employer of the leave as soon as possible after beginning it. On the other hand, the failure to give notice in advance of taking leave when the employee could have done so can be the subject of disciplinary action by the employer without violating ESA Part XVIII, s. 74. However the following points should be borne in mind:
Where the leave is taken under s. 49.7(4)(b), employees may or may not need an entire week to attend to the issue that gave rise to the domestic or sexual violence leave.
Section 49.7(12) allows an employer in this circumstance to count a part week off work as an entire week’s leave for the purpose of the 15-week entitlement. However, this is the only purpose for which the employer can deem the part week off work as an entire week’s leave. It cannot deem the employee not to have worked at all during the week. The employee is entitled to be paid for the time that was actually worked, and the hours that were worked will be counted for the purposes of, among other things, determining whether the relevant overtime threshold has been reached, whether the limits on, for example, the daily and weekly hours of work have been reached, and whether the daily, weekly/bi-weekly and in-between shifts rest requirements have been met.
While that this provision allows the employer to attribute one week's leave to a part week of absence, it does not require the employer to do so.
Note also that the employee is entitled to be on leave only during the time they are engaging in one of the activities enumerated in s. 49.7(2).
Subsection 49.7(13) requires an employee to advise their employer that the employee will be taking domestic or sexual violence leave under clause (4)(b), which is the 15-week portion of the leave. Unlike the requirements under s. 49.7(10), s. 49.7(13) specifies that the notice must be writing.
This subsection provides that where the employee must begin a leave under clause (4)(b) before providing the employer with the notice otherwise required under s. 49.7(13), that the employee must advise the employer as soon as possible after beginning the leave. Unlike s. 49.7(11), s. 49.7(14) specifies that the notice must be writing.
Further, an employee does not lose their right to domestic or sexual violence leave if they fail entirely to comply with ss. 49.7(13) or (14). An employee’s entitlement to domestic or sexual violence leave arises by virtue of meeting the eligibility criteria in s. 49.7(2), and it is the Program’s position that the failure to advise the employer before or as soon as possible after the leave begins does not negate that entitlement. This approach is consistent with the Program’s long-standing policy for all leaves contained in Part XIV where the structures of the entitlement and notice provisions are similar to these.
The question may arise as to whether an employer can penalize an employee for failing to give advance notice that they will be absent from work (as may be required under an employer policy) where the time off is taken as a domestic or sexual violence leave. Section 49.7(14) provides that “if an employee must begin a leave…before advising the employer, the employee shall advise the employer of the leave in writing as soon as possible after beginning it.” It is clear that the ESA 2000 contemplates situations where the employee would be unable to advise the employer in advance of starting the leave and that the employee nevertheless has a right to take leave in such situations, although the employee does have an obligation advise the employer of the leave in writing as soon as possible after beginning it. On the other hand, the failure to give notice in advance of taking leave when the employee could have done so can be the subject of disciplinary action by the employer without violating ESA Part XVIII, s. 74. However the following points should be borne in mind:
This provision gives an employer some ability to require an employee to provide proof that they are entitled to take domestic or sexual violence leave. The employer can require an employee to provide evidence that is “reasonable in the circumstances” that they are or was entitled to take the leave.
Evidence of entitlement to domestic or sexual violence leave may take many forms, though what is reasonable in the circumstances will be situation-specific. For example, it could be an email relating to an appointment for legal, professional or counselling services, an invoice or receipt if any of the professional services are provided on a “pay for service” or reimbursement basis, or a rental agreement or lease. There is nothing in the legislation that prohibits an employer from asking for a medical certificate and there could be scenarios where it would be reasonable in the circumstances to ask for a medical note.
Employers are not permitted to require detailed medical certificates citing the diagnosis and/or treatment of an employee’s medical condition that gave rise to the domestic or sexual violence leave entitlement. It is Program policy that it is reasonable to request only the following information on a medical certificate:
Note that it is Program policy that the employee is not required to provide evidence relating to the fact that they have experienced domestic violence or sexual violence (or the threat thereof) to an employment standards officer during the course of a claim investigation: the employee would be required to provide evidence only relating to the defined purpose(s) for which the leave was taken.
What will be reasonable in the circumstances will depend on all the circumstances in a given situation, and the general approach to what is reasonable refers to both the timelines in which the evidence is provided to the employer as well as the evidence itself. In some cases, no evidence may be available, a third party may refuse to provide evidence (for example, a domestic violence shelter may decline to issue any document that would reveal its location), or evidence may involve a security risk that a reasonable employee would not be expected to take, (for example, providing information to an employer about a temporary residence location). See ESA Part XIV, s. 50 for a discussion on what reasonable in the circumstances means in the context of evidence to support a sick leave.
Section 49.7(17) creates the requirement for an employer to have mechanisms in place to protect the confidentiality of any records given to the employer related to an employee taking domestic or sexual violence leave and any employer-created records relating to an employee taking the leave. Note that this provision applies to domestic or sexual violence leave only, not to other Part XIV leaves. Section 49.7(18) clarifies under what circumstances an employer may release or share this type of information.
Mechanisms may refer to various things put in place by the employer to prevent records related to an employee taking domestic or sexual violence leave from being seen by anyone not authorized to receive the information by s. 49.7(18). It may include a secure password set to protect electronic information, or a physical location for records storage with limited access, such as a filing cabinet in a restricted area. It may also refer to a particular method of receiving the information, such as designating a particular human resources employee as a single point of contact to limit the risk of confidential information becoming public.
Section 49.7(18) clarifies under what circumstances an employer may disclose records relating to domestic or sexual violence leave. The employer may release records if the employee has provided consent: although s. 49.7(18)(a) does not state that the consent should be in writing, for record-keeping purposes consent in writing is preferred. Disclosure may also be made to an officer, another employee, consultant or agent of the employer if the information is required for the person to do their job, for example, securing evidence or checking information such as start and end dates of periods of leave for the purpose of processing payroll. In general, the information disclosed by an employer to any of these individuals is be limited to only as much information as the other employee, consultant, or agent requires to perform their duties and no more.
Section 49.7(18)(c) also permits an employer to disclose information or records as authorized or required by law. This may include release of information to an employment standards officer in the course of a claim investigation, or a police officer if a criminal investigation is commenced and the officer has a warrant for the information. It may also include a situation where an employer has a positive obligation under the Occupational Health and Safety Act to provide limited information to workers who are at risk of physical violence in the workplace due to another employee’s history of domestic violenceviolent behaviour.
Note that at the time of writing, no permitted disclosure per s. 49.7(18)(d) has been prescribed.
The sick leave provisions were introduced into the Employment Standards Act, 2000 effective January 1, 2019 by the Making Ontario Open for Business Act, 2018.
Note that, pursuant to s. 3 of O Reg 285/01, certain employees who meet the qualifying criteria for a sick leave will not be entitled to take it if taking it would constitute an act of professional misconduct or a dereliction of professional duty. Section 3 of O Reg 285/01 reads:
See section 3 of Ontario Regulation 285/01 for more information.
Section 50(1) sets out the qualifying conditions an employee must meet in order to be entitled to sick leave. To qualify, the employee must have been employed by the employer for at least two consecutive weeks and the need for the leave must be because of one of the following events:
Sick leave is an unpaid leave. If an event is not listed in s. 50(1), the employee is not entitled to sick leave for that event. If the employee has not been employed for at least two consecutive weeks, the employee is not entitled to sick leave.
For the most part, the meaning of these terms is self-evident.
One issue that arises with respect to leaves taken because of illness, injury or medical emergency is whether an employee is entitled to take sick leave for pre-planned or so-called "elective" surgery. Because the surgery is scheduled ahead of time, it is not a medical "emergency". However, because, generally speaking, people undergo surgery for the treatment or prevention of a medical condition, it is Program policy that most surgeries, including those that are pre-planned or elective, that are performed to address or prevent manifestation of a medical condition (e.g., laser eye surgery to correct poor distance vision) are because of an illness or injury and, consequently, entitle an employee to sick leave. This does not include medically unnecessary plastic surgeries that are performed for purely cosmetic reasons and that are not related to an underlying illness or injury; these types of surgeries are not because of an illness or injury.
Another issue that arises concerns doctor's appointments. An appointment for an annual check-up would generally not trigger an entitlement to leave unless it has been scheduled in respect of an illness, injury or medical emergency. However, if an employee had regularly scheduled appointments for the treatment or management of a chronic medical condition such as Crohn's disease or diabetes, those appointments would trigger an entitlement because they are absences related to an illness.
Regular prenatal appointments scheduled for an employee during the course of a normal, healthy pregnancy would not trigger an entitlement to sick leave because a healthy pregnancy is not an illness. (Note that in this regard, consideration should also be given to the Ontario Human Rights Code, RSO 1990, c H.19 obligations to accommodate pregnant employees. Pursuant to the Code, an employer may be required to accommodate a pregnant employee's need for regular prenatal visits up to the point of undue hardship.) However, if a pregnant employee has an illness or medical condition (even if related to or exacerbated by the pregnancy) they would be entitled to sick leave as the doctor's appointments would be considered to be related to an illness.
Whether an illness, injury or medical emergency was caused by the employee's own actions or by external factors beyond the employee's control is irrelevant to the question of an employee's entitlement to sick leave. For example, an employee who broke her tailbone while tobogganing at night in an inebriated state would not be disentitled to sick leave just because the injury was caused by her own carelessness. While some may argue that in such cases the employee should not be entitled to sick leave days, there is no basis in the legislation to support such a view, and it is Program policy that absences for illness or injury, caused by the employee's own action can qualify as sick leave days.
For employees who are entitled to sick leave as provided for in s. 50, questions have arisen as to whether an employee who is absent from work for one of the reasons listed in s. 50(1) must use one of their three days of sick leave. For further information on this issue refer to the discussion under ss. 50(3) and (4).
50(2) An employee’s entitlement to leave under this section is limited to a total of three days in each calendar year.
This section provides that an employee is entitled to take up to three days of sick leave every calendar year. The entitlement is to a total of three days of sick leave per calendar year, not three days per personal illness, injury or medical emergency.
The ESA 2000 does not place any restrictions on whether the three days have to be taken consecutively or individually. Employees can take sick leave in part days (although see s. 50(5), which allows employers to deem one day's leave to be taken when an employee takes part of a day off work for sick leave), entire days, or in periods of more than one day.
The question arises as to whether the three-day entitlement should be prorated for employees who are part-time, or who started their employment partway through a calendar year but have been employed for at least two consecutive weeks. There is nothing in the legislation to suggest that employees who are eligible for sick leave should be entitled to less than three days a calendar year in any of these situations. Accordingly, it is Program policy that pro-rating of the three-day entitlement for part-time employees or employees who were hired partway through a calendar year is not permitted.
The ESA 2000 does not provide for the carryover of unused days of sick leave from one calendar year into the next calendar year. In other words, employees do not have a statutory right to "bank" unused sick leave days year over year.
It is Program policy that an employee who quits or is terminated and who is subsequently re-hired by the same employer during the same calendar year is entitled to a new three-day entitlement after two consecutive weeks of employment upon their re-hire. This is the case even if the employee took some sick leave during their first term of employment in that calendar year.
See "Greater Right or Benefit" at Part III, section 5(2) for a discussion of the application of the “greater right or benefit” provision to sick leave. See also the discussion at subsection 50(7) – (9) for information regarding the interplay between contractual leave entitlements and statutory entitlements to sick leave where the contractual leave does not amount to a “greater right or benefit”.
50(3) An employee who wishes to take a leave under this section shall advise his or her employer that he or she will be doing so.
50(4) If the employee must begin the leave before advising the employer, the employee shall advise the employer of the leave as soon as possible after beginning it.
Section 50(3) requires employees to tell their employers ahead of time that they will be taking sick leave. In circumstances where that cannot be done, the employee is required, pursuant to s. 50(4), to inform the employer as soon as possible after beginning the leave.
The ESA 2000 does not require the employee to advise the employer of the sick leave in writing. Oral notice is sufficient.
The ESA 2000 does not specify any particular method by which the employer is to be advised that the employee will be taking sick leave. Consequently, an employee would be complying with this section whether they, for example, advised the employer by phone, left a note on the manager's desk or had a colleague take a message to the employer on their behalf.
Employees do not lose their right to sick leave if they fail to comply with ss. 50(3) or (4). An employee's entitlement to sick leave arises by virtue of one of a number of “triggering events” arising, and it is the Program's position that the failure to advise the employer before or as soon as possible after the leave begins does not negate that entitlement. This approach is consistent with the Program's long-standing policy in the pregnancy and parental leave context, where the structure of the entitlement and notice provisions are similar to these. See Employment Standards Act, 2000 Part XIV, section 46(4) and section 48(4).
An issue has arisen as to whether an employer can penalize an employee for failing to give advance notice that they will be absent from work (as may be required under an employer policy), where the time off is a sick leave under the ESA 2000. Sections 50(1) describes the employee's entitlement. Section 50(3) requires the employee taking sick leave to advise the employer that they are taking the leave, and s. 50(4) provides that "if the employee must begin the leave before advising the employer, the employee shall advise the employer of the leave as soon as possible after beginning it." It is clear from s. 50(4) that the ESA 2000 contemplates situations where the employee would be unable to advise the employer in advance of commencing the sick leave. Part of the sick leave entitlement under the ESA 2000 is the right to take the sick leave even if advance notice cannot be given, with the proviso that the employee must advise the employer of the leave as soon as possible after beginning it.
The failure to give notice in advance of taking leave, when it would have been possible for the employee to do so, can be the subject of disciplinary action by the employer without violating s. 74 (the anti-reprisal provision). However, the following points should be considered:
The employee's failure to give advance notice would not be a lawful basis on which to deprive the employee of the right to take the leave if the qualifying conditions in s. 50(1) have been met. An employer could not, for example, take the position that failure to give advance notice when it would have been possible for the employee to do so will result in the time taken off not being counted as a sick leave day.
Any discipline for failing to provide notice in situations where such notice is required under s. 50(3) (i.e., where s. 50(4) does not apply) would have to be appropriately linked to the failure to give advance notice and must not, in effect penalize the employee for exercising the right to leave. The motive for any discipline that the employer does impose must clearly be the employee's failure to give advance notice and not the taking of the leave itself.
In addition, an employer would be able to impose discipline if an employee fails to provide any notice of the sick leave (before or after the leave), or if the employee provides notice of the leave so late that one wouldn’t reasonably be able to say that it falls within s. 50(4). Again, however, the employer's disciplinary action would have to be appropriate, and in no way a penalty or reprisal for the employee having taken the leave, but only for the failure to give notice. In this regard see Ryding-Regency Meat Packers Ltd. v. U.F.C.W., Local 1000A. In that case, the arbitrator concluded that s. 50(1) establishes an entitlement to leave when the qualifying events have occurred (this case referred to the former personal emergency leave, which an employee could become entitled to take when a defined relative became ill and the employee took time off work to care for the relative). The fact that the employee's grandmother was ill was not disputed. Because s. 50(1) separate from the notice requirements, the employee could be disciplined for not giving notice that he was taking or had taken leave but did not lose his entitlement to the leave itself.
50(5) For the purposes of an employee’s entitlement under subsection (1), if an employee takes any part of a day as leave under this section, the employer may deem the employee to have taken one day of leave on that day.
Employees may not need an entire work day to attend to the event that gave rise to the sick leave, and might only take part of a day off as sick leave. Section 50(5) allows an employer in this situation to count a part-day off work as an entire day's leave for the purpose of counting the absence against the three-day leave entitlement. This is the only purpose for which the employer can deem the part day off work as an entire day's leave. The employer cannot deem the employee not to have worked at all on the day. Where an employee worked a partial day and took a part-day of sick leave, the employee is entitled to be paid the earnings for the time that was actually worked that day. As well, the hours that were worked will be counted for the purposes of, among other things, determining whether the relevant overtime threshold has been reached, whether the limits on, for example, the daily and weekly hours of work have been reached, and whether the daily, weekly/bi-weekly and in-between shifts rest requirements have been met.
For clarity, this provision does not require employees to take sick leave in full day periods. It simply allows an employer to reduce the employee’s three-day entitlement by a day if an employee is on sick leave for only part of a day.
Note that this provision allows the employer to attribute one day's leave to a part day of absence. It does not require the employer to do so.
For example, an employee goes home early from work because of the stomach flu. She worked a four-hour day rather than her usual eight hours and takes sick leave. In that case, the employer may consider the employee to have used up one of her three days of sick leave and the employee would be paid her earnings for the four hours that she actually worked.
Just because an employer may consider an employee to have used one day of leave due to a part day of absence does not mean that the employee then has the right to take the entire day off if the triggering event did not last the entire day. For example, an employee's shift is from 9 a.m. to 5 p.m. From 10 a.m. to 11 a.m., he has to attend a medical appointment in relation to a chronic medical condition he suffers. The employee claims the absence as a sick leave. His employer is entitled to reduce the employee’s sick leave entitlement by one day, but the employee must nevertheless return to work after the appointment is over. Employees have the right to be away from work under the sick leave provisions of the ESA 2000 only for as long as the event that triggered the entitlement lasts. After the triggering event is over, the employee's normal obligations to attend at work are resumed.
In addition, employers cannot prohibit employees who took a part day of leave from returning to work for the remainder of their shift. (This is because of, among other reasons, the employer’s s. 53 obligation to reinstate the employee at the end of the leave and the s. 74 prohibition against penalizing employees for having taken a leave.)
An issue has arisen as to whether an employer could exercise its discretion and deem a partial day absence as a full day for some employees, but not for others, or whether this might allow employers to selectively punish employees who have too many absences in violation of the reprisal provisions of the ESA 2000.
The answer will depend on the facts. In particular, why did the employer treat the employees differently? Where an employer deems a full day's absence for some employees, but not for others, it is a question of fact as to whether the employer would be in violation of the ESA 2000.
For instance, an employer counts a three-hour sick leave as a full day's leave for employee A but not for employee B, who also takes a three-hour sick leave because the employer considers employee B to be a better worker than employee A. Although this might be unfair as between employee A and B, it would not be a violation of the ESA 2000, as it would not be a reprisal for exercising a right under the ESA 2000.
If, on the other hand, the motivation for the differential treatment was that employee A frequently took sick leave every year of only a few hours, and the employer assigned a full day's absence to these short leaves as a way to ensure employee A used up all of their statutory entitlement as soon as possible because the employer found it inconvenient for the employee to be away for many short periods of time, that would be an unlawful reprisal.
As another example, it would also be an unlawful reprisal if the motive for the differential treatment was because employee A made inquiries about ESA rights or refused to agree to average hours for overtime pay purposes.
Subsection 50(6) gives an employer the ability to require an employee to provide proof that they are or were entitled to take sick leave. The employer can require an employee to provide evidence that is reasonable in the circumstances that they are or were entitled to take the leave.
Evidence of entitlement to sick leave may take many forms. For example, if it is reasonable in the circumstances, it could take the form of: a receipt from a drugstore or pharmacy; or a medical “bracelet” from a hospital.
What will be reasonable in the circumstances will depend on all of the circumstances in any given situation. In FAG Bearings Ltd. v Francis, 2005 CanLII 35873 (ON LRB), a decision made in relation to the former personal emergency leave provisions, the employer had a disciplinary policy that provided for a four-step progression for any infraction of a company rule or policy. Under the disciplinary policy, an employee's employment would be terminated if there was a fourth disciplinary incident in a rolling twelve-month period. In this case, the third disciplinary incident was a response to the claimant failing to provide a doctor's note when he left work early because of back pain. The employer argued that the discipline was a consequence of the employee's failure to provide a doctor's note within a reasonable period of time following the absence, and not because he had exercised a right to emergency leave under the ESA 2000. The employee argued that he should have been provided with more time to provide a note. The Ontario Labour Relations Board concluded that the requirement to provide evidence reasonable in the circumstances contemplates that both the evidence required and the timelines for providing it be reasonable in the circumstances. The Board noted that the right to leave would be defeated if an employee who is legitimately entitled to it could be disciplined for failing to comply with an unreasonable time frame set by their employer. Conversely, the employer's right to verify entitlement to a leave would also be defeated if it could not require the employee to provide the evidence within a reasonable period of time. In this case, the Board found that the time to provide the evidence had been reasonable and the discipline was imposed solely as a consequence of the employee's failure to provide evidence as required under the Employment Standards Act, 2000. On that basis, the Board found the employer had not violated section 74 of the ESA 2000, since the discipline was not related to the exercise of the employee's right to leave under section 50(1).
Another helpful decision relating to evidence in the context of the former personal emergency leave is Re Tilbury Assembly Ltd. and United Auto Workers, Local 251. There, an employee with an absenteeism problem had left her shift early complaining of a severe headache. The employer had a policy that this employee was required to provide a physician's note in all cases of absence due to personal illness because of her history of absenteeism. In this instance, the employee did not obtain such a note, but instead bought some extra-strength pain relievers and took them and went to bed in a dark room, which was how she customarily dealt with this type of headache, which she experienced two or three times a year. Although the employee provided a note and receipt from the pharmacist from whom she purchased the pain relievers, the employer disciplined her for the failure to produce a physician's note. The employee grieved. The arbitrator held that the ESA 2000 gives an employer a right to require an employee to produce evidence, but only such evidence as was reasonable in the circumstances. While the employee's record of absences was one circumstance to be taken into account in determining what was reasonable, it was outweighed by the fact that the employee did have a note and receipt from a pharmacist, by the fact that her experience with the type of headache she had indicated that taking the pain relievers and going to bed in a dark room would provide effective treatment and by the fact that employee would likely face a considerable wait in a hospital emergency facility in order to see a doctor for her headache. The arbitrator found that the employer's requirement of a note from a physician was not reasonable in these circumstances and reversed the discipline.
What evidence is reasonable in the circumstances (including whether it is reasonable for the employer to require a medical note) will be fact-specific. The factors and principles that may be relevant when assessing “reasonableness” are listed below.
In circumstances where it is reasonable to require a medical certificate Ffor the purpose of determiningsupporting an employee’s entitlement to sick leave under the ESA, it is’s Program policy that employers are not permitted to require detailed medical certificates citing the diagnosis and/or treatment of the medical condition of the employee that gave rise to the sick leave entitlement. It is Program policy that it is reasonable to request only the following information on a medical certificate:
Note that any evidence the employee provides to support the employee’s claim of an entitlement to sick leave is just that — evidence — and is not necessarily determinative of the question of whether the employee had an entitlement. Depending on the circumstances, it may be reasonable for the employer to require additional evidence from the employee.
Note also that the Program policy restrictions on what an employer can require on medical certificates apply only to medical certificates as evidence in support of an employer’s entitlement to statutory sick leave. The Program’s policy does not apply to the content of medical certificates in the context of other employment issues such as return-to-work situations or for accommodation purposes.
These provisions, when read together, establish what happens when an employee takes a leave of absence under an employment contract (which includes a collective agreement) in circumstances that would also entitle the employee to a leave under s. 50 of the ESA.
“Circumstances” refers only to the triggering event that would entitle the employee to statutory sick leave (i.e. the employee is absent because of personal illness, injury or medical emergency).
It is Program policy that “circumstances” does not include the two-week employment eligibility criterion. Accordingly, these provisions will be triggered when an employee takes a leave of absence under an employment contract due to personal illness, injury or medical emergency even during the first two weeks of employment; this is the case regardless of the fact that the employee does not have the right to take statutory sick leave during this time.
Subsections 7 to 9 codify the long-standing Program policy on the interplay between contractual leave entitlements and statutory leave entitlements where the contractual leave does not amount to a greater right or benefit than statutory sick leave under s. 5(2).
(Note that if a contract does provide a greater right or benefit than the statutory sick leave entitlement —the determination of which includes consideration of reprisal protections and the entitlements under “general provisions concerning leaves” such as the right to reinstatement — the contractual leave provision applies and s. 50, including these subsections, does not apply. See the discussion of s. 5(2) for details.)
In general terms, subsections (7)-(9) provide that an employee who claims a contractual benefit for an absence — in circumstances in which the employee would also be entitled to take sick leave — does not give the employee an entitlement to those contractual absences plus an additional three days of sick leave.
If an employee takes a paid or unpaid leave of absence under an employment contract in circumstances for which he or she would also be entitled to take a leave under section 50, the employee is deemed to have taken a day of sick leave and the absence will reduce the employee’s three-day per calendar year sick leave allotment accordingly. Note that this provision must be read in conjunction with subsections 8 and 9, discussed below.
For this provision to apply, the reason for the absence (i.e. the "triggering event") must qualify for both the contractual leave and the statutory leave.
Some examples:
This provision has the potential to deem a statutory leave to be taken when a contractual leave is taken. It does not do the converse: it does not deem a contractual leave to be taken if a statutory leave is taken in circumstances for which the employee would also be entitled to take a contractual leave. The question as to whether statutory absences will also draw down against the contractual right is not a matter for the employment standards program.
If an absence has been deemed to be a statutory leave under ss. 50(7), this provision establishes that all requirements and prohibitions under the ESA, 2000 apply to the absence.
This includes all requirements and prohibitions in section 50 as well as general rights and obligations found in other sections and/or Parts of the Act.
Examples include: the right to reinstatement, maintenance of benefits (if relevant), protection from reprisal, obligations on the employee with respect to advising the employer of the leave and providing evidence reasonable in the circumstances to demonstrate an entitlement to the leave (where required by the employer).
This provision states that subsection (5) applies, with necessary modifications, to a leave that is deemed to be a sick leave pursuant to subsection (7).
This means that if an employee takes a partial-day leave pursuant to his or her contract of employment, and that leave is deemed to be a day of sick leave under subsection (7), the employer may deem the absence to be a full day of sick leave and reduce the employee’s 3-day per calendar year “allotment” of sick days accordingly.
The section 50 “personal emergency leave” (PEL) provisions of the Employment Standards Act, 2000 were repealed effective January 1, 2019 as a result of the Making Ontario Open for Business Act, 2018. The PEL provisions are therefore no longer in force. However, employees may still have a complaint relating to PEL that arose during the period of time when that leave was in force. For that reason, the Program’s interpretation of the s. 50 PEL provisions remains as part of this publication, though the text appears in red to highlight that the relevant provisions have been repealed.
Subsection 50(0.1) was repealed effective January 1, 2019 as a result of the Making Ontario Open for Business Act, 2018. The discussion of this provision is being maintained in this publication since employees may still have a complaint relating to a situation that arose when the provision was in force. The text appears in red to highlight that the provision has been repealed.
This subsection defines the term “qualified health practitioner” for the purposes of section 50. This term is used in subsection (13), which provides that an employer cannot require an employee to provide a certificate from a qualified health practitioner as evidence that the employee is entitled to take a leave under this section.
Where care or treatment is provided in Ontario:
Where care or treatment is provided in a jurisdiction other than Ontario the question of whether the person providing it is a qualified health practitioner is determined with reference to the laws of that other jurisdiction. At this time, there are no additional prescribed classes of qualified health practitioners.
Subsections 50(1) and (2) were repealed effective January 1, 2019 as a result of the Making Ontario Open for Business Act, 2018. The discussion of these provisions is being maintained in this publication since employees may still have a complaint relating to a situation that arose when the provisions were in force. The text appears in red to highlight that the provisions have been repealed.
The personal emergency leave provisions were introduced by the Employment Standards Act, 2000.
Sections 50(1) and 50(2) set out the qualifying conditions an employee must meet in order to be entitled to a personal emergency leave of absence. To qualify, the need for the leave must be due to one of the specified events and the event must relate to one of the specified individuals.
Note that, pursuant to s. 3 of O Reg 285/01, certain employees who meet the qualifying criteria for a personal emergency leave will not be entitled to take it if taking it would constitute an act of professional misconduct or a dereliction of professional duty. Section 3 of Ontario Regulation 285/01 reads:
See section 3 of Ontario Regulation 285/01 in the Manual for more information.
Sections 50(1) and 50(2) list the events, and the people to whom the events must relate, that entitle employees to take personal emergency leave. The list is exhaustive. If an event or the person to whom the event relates is not listed in ss. 50(1) and 50(2), the employee is not entitled to personal emergency leave.
Employees can take a personal emergency leave of absence for the following reasons:
The events described in subsection (2) above must relate to any of the following people:
The terms "parent" and "spouse" are defined in section 45 of the Employment Standards Act, 2000 – see Part XIV, section 45.
If the event or person to whom the event relates is not contained in the above list, the employee is not entitled to a personal emergency leave. For example, while an "urgent matter" in respect of a person specified in section 50(2) entitles an employee to personal emergency leave, a personal urgent matter does not (unless the urgent matter also falls into the category of "illness, injury or medical emergency").
For the most part, the meaning of these terms is self-evident. One issue that arises in respect of personal emergency leave taken because of the death of a specified family member or dependent relative is whether the leave days must be taken coincident with the death or can be taken at some later time. Section 50(1) states that an employee is entitled to the leave "because" of the death, illness, injury or medical emergency of an individual described in s. 50(2). As a result, time off work to attend a burial, internment of ashes or memorial service for the deceased that occurs at any time after the death qualifies as a personal emergency leave as it is taken because of the death.
An issue that arises with respect to leaves taken because of illness, injury or medical emergency is whether an employee is entitled to take personal emergency leave for pre-planned or so-called "elective" surgery. Because the surgery is scheduled ahead of time, it is not a medical "emergency". However, because, generally speaking, people undergo surgery for the treatment or prevention of a medical condition, it is Program policy that most surgeries, including those that are pre-planned or elective, that are performed to address or prevent manifestation of a medical condition (e.g., laser eye surgery to correct poor distance vision) are because of an illness or injury and, consequently, entitle an employee to personal emergency leave. This does not include medically unnecessary plastic surgeries that are performed for purely cosmetic reasons and that are not related to an underlying illness or injury; these types of surgeries are not because of an illness or injury.
Another issue that arises concerns doctor's appointments. An appointment for an annual check-up would generally not trigger an entitlement to leave unless it has been scheduled in respect of an illness, injury or medical emergency. However, if an employee had regularly scheduled appointments for the treatment or management of a chronic medical condition such as Crohn's disease or diabetes, those appointments would trigger an entitlement because they are absences related to an illness.
Regular prenatal appointments scheduled for an employee during the course of a normal, healthy pregnancy would not trigger an entitlement to personal emergency leave because a healthy pregnancy is not an illness. Note that in this regard, consideration should be given to the Ontario Human Rights Code, RSO 1990, c H.19 obligations to accommodate pregnant employees. Pursuant to the Code, an employer may be required to accommodate a pregnant employee's need for regular prenatal visits up to the point of undue hardship. However, if a pregnant employee has an illness or medical condition (even if related to or exacerbated by the pregnancy) they would be entitled to personal emergency leave as the doctor's appointments would be considered to be related to an illness.
However, see the discussion at subsections (12) and (13) below regarding evidence that an employee may be required to provide an employer to show that they are entitled to a personal emergency leave.
Whether an illness, injury or medical emergency was caused by the employee's own actions or by external factors beyond the employee's control is irrelevant to the question of an employee's entitlement to personal emergency leave. For example, an employee who broke her tailbone while tobogganing at night in an inebriated state would not be disentitled to the personal emergency leave just because the injury was caused by her own carelessness. While some may argue that in such cases the employee should not be entitled to personal emergency leave days, there is no basis in the legislation to support such a view, and it is Program policy that absences for illness or injury, caused by the employee's own action can count as personal emergency leave days.
See below for a discussion on "Designating Absences as Personal Emergency Leave."
One of the events that entitle an employee to personal emergency leave is an "urgent matter" that concerns any of the people listed in s. 50(2). Urgent matter is not defined in the ESA 2000. It is Program policy that one of the traits of an "urgent matter" is that the event be unplanned or out of the employee's control, and raise the possibility of serious negative consequences, including emotional harm, if it is not responded to. For example, it is an urgent matter if:
Some examples of situations that are not an urgent matter include:
While both of these events are out of the employee's control, the employee's inability to attend these events does not raise the possibility of serious negative consequences.
When determining whether an event is an urgent matter, an objective standard is applied. That is, the employee's subjective perception of the urgency of the matter is not determinative. However, subjective factors and circumstances that are particular to the individual employee should be taken into account. The question to ask is, would a reasonable employee in the same circumstances as the employee in question have felt that the matter was an urgent one?
Section 50(1) entitles employees to a personal emergency leave if there is a death, illness, injury, medical emergency or urgent matter concerning a person specified in paragraphs 1 to 6 of subsection 50(2), as well as a person described in paragraph 7 of subsection 50(2), that is, "a relative of the employee who is dependent on the employee for care or assistance".
The ESA 2000 does not specify how close the familial relationship has to be in order to meet this criterion. The person must only be a "relative". In the absence of a definition of relative, the term must be interpreted in accordance with its plain, ordinary grammatical sense and general acceptation.
Black's Law Dictionary, 10th ed., defines the term relative, as follows:
A person connected with another by blood or affinity; a person who is kin with another. Accordingly, it is Program policy that to be a relative of an employee, the individual should be related through blood or through marriage, adoption or common law relationships between people of the same or opposite sex who are not married. Conversely, it is Program policy that "relative" in s. 50(2), paragraph 7 will not include those individuals who are not connected either by blood or through marriage, adoption or a common law relationship, since including them would be extending the meaning of relative beyond the ordinary, commonly understood meaning.
With respect to common law relationships, the question arises as to how long the individuals have to live together in a conjugal relationship before it can be said that a spousal relationship exists, thus granting relative status to relatives of the employee's spouse. The answer is that there is no minimum amount of time that the individuals must be together in order to qualify as a common law spouse for the purpose of entitlement to personal emergency leave. Unlike the Family Law Act, RSO 1990, c F.3 which, for the purposes of support obligations, limits the definition of unmarried "spouse" to those people who have lived together continuously for three years or are in a relationship of some permanence if they are the birth or adoptive parents of a child, s. 45 of the ESA 2000 requires only that the individuals "live together in a conjugal relationship outside marriage".
Accordingly, it is Program policy that the relationship of relative can be established through a common law relationship between people of the same or opposite sex once there is a conjugal relationship, regardless of how long it has been. (Note that the entitlement to personal emergency leave does not arise solely by virtue of the illness, injury, medical emergency, death or urgent matter of a relative. If that relative is not in a category specified in paragraphs 1 through 6, that relative must be dependent on the employee for care or assistance before there is an entitlement to personal emergency leave. See the discussion below).
An employee is entitled to take personal emergency leave with respect to the illness, injury, medical emergency, death or urgent matter of an individual not in a category specified in paragraphs 1 through 6, only where that individual is a relative who is "dependent on the employee for care or assistance". The ESA 2000 does not specify how dependent a relative has to be on the employee for this provision to apply. It only requires that there be a dependence for care or assistance. As individuals can be dependent on one another for care or assistance without being entirely dependent on that person, it is Program policy that this provision will apply to any relative who is reliant on the employee to some degree for care or assistance in meeting their basic living needs. The relative does not have to be completely reliant on the employee for all of their needs for this provision to apply.
There is no requirement that the relative be living with the employee for this provision to apply.
The type of event that entitles an employee to a personal emergency leave does not have to relate to the particular type of dependence the relative has on the employee in order to meet this criteria. For example, an employee's great-uncle depends on the employee to purchase his prescriptions and ensure he takes his medication. The employee wants to take personal emergency leave because her great-uncle's house is broken into and he needs assistance. The employee will be entitled to personal emergency leave even though the matter that is being responded to (a break-in) is unrelated to the type of dependence (ensuring that medication is taken).
For employees who are entitled to personal emergency leave as provided for in s. 50, questions have arisen as to whether an employee who is absent from work for one of the reasons listed in s. 50(1) must use one of their 10 days of personal emergency leave. It is Program policy that where an employee is entitled to personal emergency leave and is absent due to one of the reasons listed in s. 50(1), it is the employee (not the employer) that decides whether to designate an absence a personal emergency leave. An employee may be entitled to personal emergency leave and be absent from work due to one of the reasons listed in s. 50(1) and decide not to claim the absence as a personal emergency leave day. This would not be considered as contracting out of the ESA 2000 if an employee does not take advantage of their leave entitlements; the employee has merely chosen not to exercise them.
Step 1: The employee, who is entitled to personal emergency leave, is absent due to one of the reasons listed in s. 50(1).
Step 2: Did the employee know of their right to personal emergency leave?
If the answer is no, then the default is that the absence is considered to be personal emergency leave with the corresponding reprisal protection. An employee does not lose their right to any of the leaves provided for under the ESA 2000 because they were unaware of their entitlements.
If the employee is aware of their right to personal emergency leave go to step 3.
Step 3: Does the employee wish to designate the absence as personal emergency leave?
If the answer is yes, then the absence is a personal emergency leave with the corresponding reprisal protections.
If the employee does not wish to designate the absence as a personal emergency leave, and the absence cannot be considered an authorized absence on some other ground (e.g., another leave under the ESA 2000 or vacation authorized by the employer), the absence would have no statutory reprisal protection. For this reason, an employee who takes a day off for a reason that would qualify under s. 50 but who would prefer not to have the day charged against their personal emergency leave allotment may feel effectively forced into designating the day as such a leave. However, this in itself does not constitute any violation of the ESA 2000; it is not unlawful for an employer to inform an employee that should they not designate an absence as a personal emergency leave day, then it would be considered an unexcused absence that will lead to disciplinary action.
Note that if an employer offers a benefit plan for sick days, bereavement days or for any other event that any leave under the ESA 2000 can be taken, and the employee opts to claim benefits under the plan, it is Program policy that the employee has in effect designated the absence as a day of statutory leave and it will reduce the employee’s ESA 2000 entitlement to that particular statutory leave accordingly. For example, if an employer offers four paid bereavement days under a benefits plan and the employee is absent four days because of the death of a parent and claims benefits under the plan, the employee is considered to have used four of their PEL days. Note also that there is nothing in the ESA 2000 that would prohibit an employer from subtracting any personal emergency leave days that are taken from any paid days provided by a benefit plan offered by an employer or from any other contractual leave entitlement (e.g. “flex days”). Notably, while this is not prohibited under the ESA 2000, an employment contract may address the issue of whether any PEL days count against any contractual leave entitlements.
Where a benefit plan offered by the employer constitutes a true greater right or benefit than the personal emergency leave standard, then the terms of the contract will apply instead of the standard (as the employee will have a greater contractual entitlement) and the issue of an employer drawing down on personal emergency days leave becomes moot.
While not prohibited under the ESA 2000, an employment contract may address the issue of whether any work-related injury governed by the “Workplace Safety and Insurance Act” (WSIA) may count against PEL days.
Subsections 50(3) and (4) were repealed effective January 1, 2019 as a result of the Making Ontario Open for Business Act, 2018. The discussion of these provisions is being maintained in this publication since employees may still have a complaint relating to a situation that arose when the provisions were in force. The text appears in red to highlight that the provisions have been repealed.
Section 50(3) requires employees to tell their employers ahead of time that they will be taking personal emergency leave. In circumstances where that cannot be done, the employee is required, pursuant to s. 50(4), to inform the employer as soon as possible after beginning the leave.
The ESA 2000 does not require the employee to advise the employer of the personal emergency leave in writing. Oral notice is sufficient.
In fact, the ESA 2000 does not specify any particular method by which the employer is to be advised that the employee will be taking personal emergency leave. Consequently, an employee would be complying with this section whether they, for example, advised the employer by phone, left a note on the manager's desk or had a colleague take a message to the employer on their behalf.
An employee does not lose their right to emergency leave if they fail to comply with subsection 50(3) or (4). An employee's entitlement to emergency leave arises by virtue of having one of a number of defined "emergencies", and it is the Program's position that the failure to advise the employer before or as soon as possible after the leave begins does not negate that entitlement. This approach is consistent with the Program's long-standing policy in the pregnancy and parental leave context, where the structure of the entitlement and notice provisions are similar to these. See Employment Standards Act, 2000 Part XIV, section 46(4) and section 48(4).
An issue has arisen as to whether an employer can penalize an employee for failing to give advance notice that they will be absent from work (as may be required under an employer policy), where the time off is a personal emergency leave under the ESA 2000. Sections 50(1) and (2) describe the employee's entitlement (that is, the type of emergency situation and with respect to which individuals). Section 50(3) requires the employee taking personal emergency leave to advise the employer that they are taking the leave, and s. 50(4) provides that "if the employee must begin the leave before advising the employer, the employee shall advise the employer of the leave as soon as possible after beginning it." It is clear from s. 50(4) that the ESA 2000 contemplates situations where the employee would be unable to advise the employer in advance of commencing the personal emergency leave. Part of the personal emergency leave entitlement under the ESA 2000 is the right to take the personal emergency leave even if advance notice cannot be given, with the proviso that the employee must advise the employer of the leave as soon as possible after beginning it. The failure to give notice in advance of taking leave, when it would have been possible for the employee to do so, can be the subject of disciplinary action by the employer without violating s. 74. However, the following points should be borne in mind:
In addition, an employer would be able to impose discipline if an employee fails to provide any notice of the personal emergency leave (before or after the leave), or if the employee provides notice of the leave so late that one wouldn’t reasonably be able to say that it falls within s. 50(4). However, the employer's disciplinary action would have to be appropriate, and in no way a penalty or reprisal for the employee having taken the leave, but only for the failure to give notice. In this regard see Ryding-Regency Meat Packers Ltd. v. U.F.C.W., Local 1000A. In that case, the arbitrator concluded that s. 50(1) establishes an entitlement to leave where a person described in s. 50(2) is ill. The fact that the employee's grandmother was ill was not disputed. Because s. 50(1) and (2) are in no way linked to the notice requirements, the employee could be disciplined for not giving notice that he was taking or had taken leave but did not lose his entitlement to the emergency leave.
Subsection 50(5) was repealed effective January 1, 2019 as a result of the Making Ontario Open for Business Act, 2018. The discussion of this provision is being maintained in this publication since employees may still have a complaint relating to a situation that arose when the provision was in force. The text appears in red to highlight that the provision has been repealed.
This section provides that an employee is entitled to take up to ten days of personal emergency leave every calendar year, and that two of the days of leave are to be paid. This provision also references section 50(6) which limits the entitlement to paid leave to employees who have been employed for at least one week.
The ESA 2000 does not place any restrictions regarding whether the ten days have to be taken consecutively or individually. Employees can take personal emergency leave in part days (although see s. 50(7), which allows employers to deem one day's leave to be taken when an employee takes part of a day off work for personal emergency leave), entire days, or in periods of more than one day.
The question arises as to whether the 10-day entitlement should be prorated for employees who are part-time, or who started their employment partway through a calendar year. There is nothing in the legislation to suggest that employees who are eligible for personal emergency leave should be entitled to less than ten days a calendar year in any of these situations. Accordingly, it is Program policy that there should be no pro-rating of the 10-day entitlement. The ESA 2000 does not provide for employees to be able to carry unused days of personal emergency leave from one calendar year over into the next calendar year.
See "Greater Right or Benefit" at Part III section 5 for a discussion of the relationship between the right to ten days' leave under this Part and rights to leaves under contracts and collective agreements. See subsection (1) above for a discussion on "Designating Absences as Personal Emergency Leave."
Automobile manufacturing/marshalling: per section 4 of Ontario Regulation 502/06, employees who work in the defined industry of automobile and automobile parts manufacturing, automobile marshalling and automobile parts warehousing have a different entitlement to personal emergency leave. These employees are entitled to seven days of personal emergency leave for an illness, injury or medical emergency related either to the employee or one of the individuals listed in subsection 4(4) of Ontario Regulation 502/06, or an urgent matter for any of the specified individuals. In addition, these defined industry employees are entitled to up to three days of leave because of the death of any of the specified individuals in section 4(4) of Ontario Regulation 502/06 each time there is such a death. Ontario Regulation 502/06 also establishes an exception to the requirement that the first two days of personal emergency leave are to be paid if certain criteria are met. See Ontario Regulation 502/06, section 4 for more details.
Construction employees: per section 3.0.1 of Ontario Regulation 285/01, a “construction employee who works in the construction industry” is not entitled to personal emergency leave pay if the employee receives 0.8% of their hourly rate or wages for “personal emergency pay”. However, the employee will remain entitled to 10 days of personal emergency leave per calendar year. See Ontario Regulation 285/01, section 3.0.1 for more details.
When this section originally came into force on September 4, 2001, it provided that the entitlement was to 10 days' leave each year. This section was amended by the Employment Standards Amendment Act (Hours of Work and Other Matters), 2004, SO 2004, c 21 (which came into force on March 1, 2005) to provide that the entitlement is to 10 days' leave each calendar year. The section was further amended by the Fair Workplaces, Better Jobs Act, 2017 SO 2017, c22 on January 1, 2018 to provide for two days of paid leave.
Subsection 50(6) was repealed effective January 1, 2019 as a result of the Making Ontario Open for Business Act, 2018. The discussion of this provision is being maintained in this publication since employees may still have a complaint relating to a situation that arose when the provision was in force. The text appears in red to highlight that the provision has been repealed.
This section limits the entitlement to paid leave to employees who have been employed by the employer for one week or more. An employee who takes personal emergency leave within the first week of employment will not be entitled to be paid for it, but will retain the entitlement to two paid days if further leave is taken later in the calendar year. The provision also clarifies that any unpaid days of leave that have been taken by an employee before they were employed for one week will be counted against the total entitlement of 10 days per calendar year. This section must be read in conjunction with s. 50(8), which requires that the first two days of leave within the calendar year must be paid; employees who have been employed for less than one week are specifically excluded from that rule until they have been employed for one week or longer.
For example, an employee takes two days of personal emergency leave in the first week of employment, and then two further days of leave in the sixth week of employment: the employee will be entitled to an unpaid, job-protected leave for the first two days, and will be entitled to paid, job-protected leave for days three and four (even though they are not the first two days of leave taken within the year).
Note that if the employer has a policy or the employee’s contract of employment that provides, for example, three days of paid sick leave per year regardless of the length of employment and the employee was absent during the first week of employment for a reason that triggered both the policy/contract’s sick leave provisions as well as personal emergency leave, the employee will be considered to have received their paid PEL entitlements. In other words, if an employee in the scenario above uses all three days of paid sick leave during the first week of employment for a personal illness, the employer is not prohibited by anything in the ESA 2000 from counting the paid sick days against the employee’s entitlement per the employment contract, as well as three personal emergency leave days and two days of personal emergency leave pay from the employee’s statutory entitlement. However, note that the amount of pay the employee received under the contract must at least equal the employee’s entitlement to personal emergency leave pay under the ESA 2000.
Subsection 50(7) was repealed effective January 1, 2019 as a result of the Making Ontario Open for Business Act, 2018. The discussion of this provision is being maintained in this publication since employees may still have a complaint relating to a situation that arose when the provision was in force. The text appears in red to highlight that the provision has been repealed.
Employees frequently do not need an entire work day to attend to the event that gave rise to the personal emergency leave, and will only take part of a day off as personal emergency leave. Section 50(6) allows an employer in this situation to count the part-day off work as an entire day's leave for the purpose of the 10-day leave entitlement. This is the only purpose for which the employer can deem the part day off work as an entire day's leave. It cannot deem the employee not to have worked at all on the day. The employee is entitled to be paid for the time that was actually worked and personal emergency leave pay with respect to the time that was not worked (if the partial absence was on a day for which the employee was entitled to personal emergency leave pay). As well, the hours that were worked will be counted for the purposes of, among other things, determining whether the relevant overtime threshold has been reached, whether the limits on, for example, the daily and weekly hours of work have been reached, and whether the daily, weekly/bi-weekly and in-between shifts rest requirements have been met.
For example, an employee goes home early from work because of the stomach flu (e.g., a four-hour day rather than his usual eight hours) and takes PEL In that case, the employer may attribute a full personal emergency leave day to the partial day's absence.
Just because an employer may attribute an entire day's leave to a part day of absence does not mean that the employee then has the right to take the entire day off if the emergency did not last the entire day. For example, an employee's shift is from 9 a.m. to 5 p.m. He has to meet with his son's school principal on an urgent matter from 10 a.m. to 11 a.m. His employer is entitled to count the absence as an entire day's personal emergency leave, but the employee must nevertheless return to work after the meeting is over. Employees have the right to be away from work under the personal emergency leave provisions of the ESA 2000 only for as long as the emergency lasts. After the emergency is over, the employee's normal obligations to attend at work are resumed.
Note that this provision allows the employer to attribute one day's leave to a part day of absence. It does not require the employer to do so.
An issue has arisen as to whether an employer could exercise its discretion and deem a partial day absence as a full day for some employees, but not for others, or whether this might allow employers to selectively punish employees who have too many absences in violation of the reprisal provisions of the ESA 2000.
The answer will depend on the facts. In particular, why did the employer treat the employees differently? Where an employer deems a full day's absence for some employees, but not for others, it is a question of fact as to whether the employer would be in violation of the ESA 2000. For instance, if the employer counts a three-hour personal emergency leave as a full day's leave for employee A but not for employee B, who also takes a three-hour personal emergency leave because the employer considers employee B to be a better worker than employee A, although this might be unfair as between employee A and B, it would not be a violation of the ESA 2000, as it would not be reprisal for exercising a right under the ESA 2000. If, on the other hand, the motivation for the differential treatment was that Employee A frequently took personal emergency leave of only a few hours, and the employer assigned a full day's absence to these short leaves as a way to ensure employee A used up all of their statutory entitlement as soon as possible because the employer found it inconvenient for the employee to be away for many short periods of time, that would be an unlawful reprisal.
Subsection 50(8) was repealed effective January 1, 2019 as a result of the Making Ontario Open for Business Act, 2018. The discussion of this provision is being maintained in this publication since employees may still have a complaint relating to a situation that arose when the provision was in force. The text appears in red to highlight that the provision has been repealed.
This section requires that the employee be paid for the first two days of leave. The employer does not have the discretion to pay the employee, for example, for the ninth and tenth days of leave (or any other days) instead of the first two days (unless s. 50(6) applies).
The entitlement would exist regardless of when the paid leave days are taken, for example, if an employee took the first two days of leave on the last two days of a calendar year, the employee could also take the first two days of the following calendar year as paid leave providing a qualifying event had occurred involving either the employee or a person described in s. 50(2). In this case, the employee could be entitled to up to four days of paid leave, potentially within the same week.
Subsection 50(9) was repealed effective January 1, 2019 as a result of the Making Ontario Open for Business Act, 2018. The discussion of this provision is being maintained in this publication since employees may still have a complaint relating to a situation that arose when the provision was in force. The text appears in red to highlight that the provision has been repealed.
This section sets out the manner of calculating the amount of personal emergency leave pay.
Note, subject to subsection (10) and (11), the calculation entitles employees only to wages they would have earned if they were at work and not on personal emergency leave: this is read in conjunction with s. 50(7), and will allow an employer to deem a partial day personal emergency leave absence as a complete day of leave, but only require the employer to pay personal emergency leave pay representing the amount of time at work missed as well as any wages the employee earns while actively at work on that day. Per s. 50(10), overtime pay and shift premium amounts are not to be included in personal emergency leave pay even if the employee “would have earned” these if the employee worked. Per section 50(11), if a paid day of personal emergency leave falls on a public holiday, the employee is not entitled to premium pay for any leave taken. Personal emergency leave pay for a day can be any amount from a single hour’s pay or less to an entire day of wages, depending on how much leave is taken.
At this time, no other manner of calculating personal emergency leave pay has been prescribed.
In order to determine how much personal emergency leave pay an employee is entitled to, two things need to be established:
If the employee:
The amount of personal emergency leave taken on a single day is calculated by deducting the number of hours actually worked, if any, from the total number of hours in the work day. For example, if it is determined that the employee was scheduled to work nine hours on the day, and they took five hours to deal with a personal illness, they would be entitled to four hours of wages and five hours of personal emergency leave pay. If the same employee missed the entire day, they would be entitled to nine hours of personal emergency leave pay.
The situation may arise when an employee may be required to report to work at a particular time, but does not have a shift or work period of a specified length. In that case, when assessing the amount of wages an employee would have earned had they not taken PEL in order to determine the amount of PEL pay owing, the employer must make a reasonable estimate of how long the employee would have worked on that day. For example, it could be reasonable for an employer to take an average of the number of hours worked by all the employees in the same position as the employee who took leave on the day, or if another employee was called in to replace the employee on the day, it could be reasonable to refer to the length of that employee’s shift.
When an employment standards officer is investigating a claim from an employee who believes they received less personal emergency leave pay than the ESA 2000 requires (perhaps because the employer took the position that the business was not busy on that particular day and the employer intended to send the employee home early) the officer makes a determination on whether the amount paid by the employer was reasonable. Evidence may include direct evidence from other employees, receipts, point of sale records, customer or production logs, or the staff schedule from the day in question. If the employer has a staff rotation policy and employees are sent home early in a particular order when the business is not busy, was the employee the next person on the list?
For employees who are not paid by performance-related wages:
If the employee is paid by an hourly wage, the amount of personal emergency leave pay is the number of hours of personal emergency leave x the hourly rate.
Entitlement:
Entitlement:
If the employee is paid by salary and has a regular number of days within a pay period and regular hours, the amount of personal emergency leave pay is:
This is, in effect, salary continuance. If an employer pays an employee with a fixed salary the normal amount of pay for a week with a day of full or partial personal emergency leave in it, the personal emergency leave pay provisions of the ESA 2000 will be satisfied.
Example 1: An employee is paid $1500.00 per bi-weekly pay period and works a five-day week. 1 day of personal emergency leave is taken. Personal emergency leave pay = $1500.00 ÷ 10 = $150.00.
Example 2: An employee is paid $1500.00 per bi-weekly pay period and works a 40 hour week. She takes four hours of personal emergency leave. Hourly rate: $1500.00 ÷ 80 = $18.75/hour. Personal emergency leave pay: $18.75 × 4 = $75.00. Note that the employee is also entitled to wages earned for the part of the day that she worked.
A situation may arise where the employee receives a “top-up” or subsidy from a third party in addition to an hourly rate of pay or salary. For example, an employee who works in a daycare centre may be paid $16.00/hour plus $2.00/hour as part of a municipal or provincial government initiative to raise wages for workers in the sector. Depending on how the subsidy is structured, it may or may not be considered “wages the employee would have earned” for the purposes of personal emergency leave pay. If the employee is paid the subsidy directly by an entity other than the employer, then the subsidy may not be considered “wages that the employee would have earned” because they are not wages being paid by the employer. If, however, the subsidy and the hourly rate are a term of the contract of employment with the employer (oral or written, express or implied), then the subsidy amount must be included in the calculation of personal emergency leave pay.
Another situation that may arise where the employer has a benefit plan in place that pays benefits to employees when events occur that trigger both an entitlement to benefits under the plan as well as personal emergency leave pay under the ESA 2000. It is Program policy that the employer may take benefit plan payments into account when fulfilling its obligation to provide personal emergency leave pay. What is key is that the employee receives pay for any paid days of leave in accordance with s. 50.
For example, a benefit plan pays a benefit that equals 75% of an employee’s wages when the employee takes a day off for personal illness. In order to comply with s. 50(9), the employer would be required to ensure that the employee received their full entitlement to personal emergency leave pay: if the employee missed an entire day of work to take the leave, the employer would be required to pay the additional 25% of the wages that the employee would have earned had they not taken the leave.
The amount of personal emergency leave pay for an employee paid fully or partly by a system of wage calculation related to performance is the greater of the employee’s “hourly rate, if any” and the minimum wage that would have applied to the employee. “Performance-related wages” can include commission only, commission plus an hourly wage, piece work, or compensation as a flat-rate mechanic. An “hourly rate” refers to an hourly rate set by an employment contract.
Subsection 50(10) was repealed effective January 1, 2019 as a result of the Making Ontario Open for Business Act, 2018. The discussion of this provision is being maintained in this publication since employees may still have a complaint relating to a situation that arose when the provision was in force. The text appears in red to highlight that the provision has been repealed.
This section excludes overtime pay or a shift premium (for example, an extra amount paid for working evenings or weekends) from inclusion when calculating personal emergency leave pay. The employee would be entitled to be paid for hours of personal emergency leave using their regular rate of pay, and not for example 1.5 times their regular rate per the overtime provisions of the Employment Standards Act, 2000.
Similarly, if an employee is scheduled to work hours that would normally attract a shift premium, if the employee misses all or some of the shift to take personal emergency leave, then personal emergency leave pay will be calculated on the employee’s “base” rate and would not include the shift premium.
Subsection 50(11) was repealed effective January 1, 2019 as a result of the Making Ontario Open for Business Act, 2018. The discussion of this provision is being maintained in this publication since employees may still have a complaint relating to a situation that arose when the provision was in force. The text appears in red to highlight that the provision has been repealed.
Under Part X (Public Holidays) of the ESA 2000 employees who agree to, or are required to work on a public holiday may be entitled to receive premium pay of at least one and one half times their regular rate for hours worked on that day (see the Public Holidays Chapter for details on entitlements under Part X). The effect of this subsection is that —-despite the entitlement in s. 50(9) to be paid “the wages the employee would have earned had they not taken the leave” — the employee is not entitled to any premium pay that they would have earned by working on the public holiday had the leave not been taken.
Note that in certain situations, per Part X (Public Holidays) of the ESA 2000), the onus is on the employee to prove that they had “reasonable cause” for not working all or part of a scheduled shift either on a public holiday, or the “first and last” shifts before or after a public holiday. Also note that it is Program policy that if an employee takes personal emergency leave, this will constitute reasonable cause for the purposes of Part X. This is subject to s. 50(13) which prohibits an employer from requiring that the employee provide a certificate from a qualified health practitioner as evidence of an entitlement to PEL. Therefore an employer can only require an employee to provide other evidence “reasonable in the circumstances” per s. 50(12).
An employee was scheduled to work on a public for nine hours and was going to be paid public holiday pay plus premium pay for the nine hours. The employee worked for three hours and took six hours as personal emergency leave. The employee earns $15.00/hour.
For more information on Public Holiday Entitlements, please see Part X of the Employment Standards Act, 2000.
Subsections 50(12) and (13) were repealed effective January 1, 2019 as a result of the Making Ontario Open for Business Act, 2018. The discussion of these provisions is being maintained in this publication since employees may still have a complaint relating to a situation that arose when the provisions were in force. The text appears in red to highlight that the provisions have been repealed.
S. 50(12) gives an employer some ability to require an employee to provide proof that they are or were entitled to take personal emergency leave, subject to the limitation imposed by subsection (13). The employer can require an employee to provide evidence that is reasonable in the circumstances that they are or were entitled to take the leave.
Evidence of entitlement to personal emergency leave may take many forms. For example, it could be a death certificate, or a note from a daycare provider, school or other care facility. Receipts could also constitute proof of the emergency, e.g., an invoice from a plumber who was called in to deal with a flooded basement.
However, an employee cannot be required to provide a “certificate” (or medical note) from a qualified health practitioner — see s. 50(0.1) for more information on the definition of a qualified health practitioner. Note that s. 50(13) states that an employer “shall not require” a medical certificate from a qualified health practitioner: this prohibition applies to both a single request in relation to a specific absence, or the inclusion of such a requirement in an absenteeism management policy established by an employer. An employee may provide a certificate or medical certificate, but any evidence that an employee was threatened with discipline for failing to provide a note “voluntarily” would contribute to a finding that a reprisal under s. 74 had occurred.
It may, however, be reasonable in the circumstances for an employee taking personal emergency leave relating to their own illness, injury or medical emergency to be required to provide something other than a certificate or medical note issued by a qualified health practitioner.
What will be reasonable in the circumstances will depend on all of the circumstances in any given situation. In FAG Bearings Ltd. v Francis, 2005 CanLII 35873 (ON LRB) the employer had a disciplinary policy that provided for a four-step progression for any infraction of a company rule or policy. Under the disciplinary policy, an employee's employment would be terminated if there was a fourth disciplinary incident in a rolling twelve-month period. In this case, the third disciplinary incident was a response to the claimant failing to provide a doctor's note when he left work early because of back pain (note that, at the time, the ESA 2000 permitted an employer to require “evidence reasonable in the circumstances” of entitlement to the leave, which could include medical evidence). The employer argued that the discipline was a consequence of the employee's failure to provide a doctor's note within a reasonable period of time following the absence, and not because he had exercised a right to emergency leave under the ESA 2000. The employee argued that he should have been provided with more time to provide a note. The Ontario Labour Relations Board concluded that the requirement to provide evidence reasonable in the circumstances contemplates that both the evidence required and the timelines for providing it be reasonable in the circumstances. The Board noted that the right to leave would be defeated if an employee who is legitimately entitled to it could be disciplined for failing to comply with an unreasonable time frame set by their employer. Conversely, the employer's right to verify entitlement to a leave would also be defeated if it could not require the employee to provide the evidence within a reasonable period of time. In this case, the Board found that the time to provide the evidence had been reasonable and the discipline was imposed solely as a consequence of the employee's failure to provide evidence as required under the ESA 2000. On that basis, the Board found the employer had not violated s. 74 of the ESA 2000, since the discipline was not related to the exercise of the employee's right to leave under s. 50(1).
Another helpful decision in this regard is Re Tilbury Assembly Ltd. and United Auto Workers, Local 251. This decision also pre-dates the coming into force of subsection (13) and the limit placed on medical evidence. There, an employee with an absenteeism problem had left her shift early complaining of a severe headache. The employer had a policy that this employee was required to provide a physician's note in all cases of absence due to personal illness because of her history of absenteeism. In this instance, the employee did not obtain such a note, but instead bought some extra-strength pain relievers and took them and went to bed in a dark room, which was how she customarily dealt with this type of headache, which she experienced two or three times a year. Although the employee provided a note and receipt from the pharmacist from whom she purchased the pain relievers, the employer disciplined her for the failure to produce a physician's note. The employee grieved. The arbitrator held that the ESA 2000 gives an employer a right to require an employee to produce evidence, but only such evidence as was reasonable in the circumstances. While the employee's record of absences was one circumstance to be taken into account in determining what was reasonable, it was outweighed by the fact that the employee did have a note and receipt from a pharmacist, by the fact that her experience with the type of headache she had indicated that taking the pain relievers and going to bed in a dark room would provide effective treatment and by the fact that employee would likely face a considerable wait in a hospital emergency facility in order to see a doctor for her headache. The arbitrator found that the employer's requirement of a note from a physician was not reasonable in these circumstances and reversed the discipline.
Evidence that is reasonable in the circumstances will be fact-specific. The factors and principles that may be relevant when assessing “reasonableness” are:
In addition, the Youth Criminal Justice Act, SC 2002, c 1("YCJA") prohibits the disclosure of any information that may identify a young person who has committed or is alleged to have committed an offence, a young person who is a victim of the offence, or a young person who is called as a witness in any proceeding in connection with the alleged offence. Employees who take a personal emergency leave because a young person specified in s. 50(2) is involved in a YCJA matter are not obliged to divulge to the employer (or officer) any information regarding the identity of the young person (for example, the name or their relationship to the employee). Instead, it is Program policy that it would be reasonable in the circumstances that the employee state that a relative was involved in a court proceeding.
Note that, in certain situations per Part X (Public Holidays) of the Employment Standards Act, 2000, the onus is on the employee to prove that they had reasonable cause for not working all or part of a scheduled shift either on a public holiday, or the “first and last” shifts before or after a public holiday. Also note that it is Program policy that if an employee takes personal emergency leave, this will constitute reasonable cause for the purposes of Part X. This is subject to s. 50(13) which prohibits an employer from requiring that the employee provide a certificate from a qualified health practitioner as evidence of an entitlement to personal emergency leave (PEL). Therefore, an employer can only require an employee to provide other evidence reasonable in the circumstances per section 50 (12).
In some circumstances, an employee may be required by an employer to provide evidence that they are fit to return to work after an illness or injury. While s. 50(13) prohibits an employer from requiring an employee to provide a certificate from a qualified health practitioner, this is in relation to determining the employee’s eligibility for s.50 entitlements only. If an employer requires the employee to provide a medical note or certificate only for the purpose of confirming that the employee is capable of performing regular or modified duties before the employee returns to work, this would not be a violation of s. 50(13) of the ESA 2000.
If an employer provides paid “sick days” in excess of the requirement under the ESA 2000 for two days of personal emergency leave taken in the calendar year to be paid, whether or not the prohibition against requiring a certificate from a qualified health practitioner (a “medical note”) applies depends on whether the contract of employment offers a greater right or benefit under s. 5(2) of the ESA 2000.
If the “sick day” provisions contained in the employee’s contract of employment are a greater right or benefit after all of its features have been compared with the personal emergency leave provisions in the ESA 2000, then the terms of the employment contract will apply and the prohibition contained in ss. 50(13) will not apply to any of the absences. In that case, if the terms include a requirement for the employee to provide a medical note upon request, the employee will be required to do so in accordance with the contract of employment and the prohibition contained in s. 50(13) will not apply.
If the benefit offered by the contract of employment is not a greater right or benefit, then the provisions of the ESA 2000 will apply. Per s. 50(13) the employer cannot require the employee to provide a medical note for the purpose of proving the employee’s entitlement to PEL for any of the ten statutory personal emergency leave days — paid or unpaid — the employee is entitled to. If, however, a contract of employment provides for paid sick days over and above the two days of paid PEL an employee is entitled to under the ESA 2000, the employer is not prohibited from requiring a medical note as a condition for providing pay for those additional paid sick days. The employer may not require the note as evidence that the employee is entitled to take the time off as personal emergency leave.
Consider the example of a contract of employment that offers a benefit of six paid sick days per calendar year. Assume that the contract does not provide a greater right or benefit and that s. 50 therefore applies. If an employee takes their first two days of personal emergency leave in the calendar year for personal illness, the employer would be prohibited from requiring a medical note from the employee and the employee would be entitled to two paid days of personal emergency leave pay (provided they have worked for the employer for one week or longer). If the same employee takes the four more days of personal emergency leave in the same calendar year for personal illness, although the employer is prohibited from requiring a medical note to support the employee’s eligibility for the leave, the employer is not prohibited from requiring a medical note to support the employee’s contractual entitlement to the pay for the remaining four sick days. Because the pay for the last four sick days are over and above the employee’s entitlement to personal emergency leave pay under the ESA 2000, the prohibition in s. 50(13) does not apply to that pay. However, the prohibition in s. 50(13) will continue to apply to the entitlement to take the leave of absence.
Another example is where an employer offers 12 days of “personal leave” or “sick leave” under the contract of employment within a calendar year. Assume that the contract does not provide a greater right or benefit and that s. 50 therefore applies. The prohibition applies only to the ten statutory personal emergency leave days the employee is entitled to. The prohibition in s. 50(13) would not apply to the 11th or 12th absences.
The family responsibility leave provisions were introduced into the Employment Standards Act, 2000 effective January 1, 2019 by the Making Ontario Open for Business Act, 2018.
Sections 50.0.1(1) and 50.0.1(3) set out the qualifying conditions an employee must meet in order to be entitled to an unpaid family responsibility leave. To qualify, the employee must have been employed by the employer for at least two consecutive weeks, the need for the leave must be because of one of the events specified in subsection (1) and the event must relate to one of the individuals specified in subsection (3).
Note that, pursuant to s. 3 of Ontario Regulation 285/01, certain employees who meet the qualifying criteria for a family responsibility leave will not be entitled to take it if taking it would constitute an act of professional misconduct or a dereliction of professional duty. Section 3 of Ontario Regulation 285/01 reads:
See section 3 of Ontario Regulation 285/01 for more information.
Sections 50.0.1(1) and 50.0.1(3) list the events, and the people to whom the events must relate, that entitle employees who have been employed for at least two consecutive weeks to take family responsibility leave. The list is exhaustive. If an event or the person to whom the event relates is not listed in ss. 50.0.1(1) and 50.0.1(3), the employee is not entitled to family responsibility leave. If the employee has not been employed for at least two consecutive weeks, the employee is not entitled to family responsibility leave.
Employees can take a family responsibility leave of absence because of the following events:
The events described in the list above must relate to one of the following people:
The terms parent
and spouse
are defined in section 45 of the Employment Standards Act 2000 – see Part XIV, section 45.
If the event or person to whom the event relates is not contained in the above list, the employee is not entitled to a family responsibility leave. For example, while an urgent matter
in respect of a person specified in s. 50.0.1(3) entitles an employee to family responsibility leave, a personal urgent matter does not.
In general, the meaning of these terms is self-evident.
One issue that arises with respect to leaves taken because of illness, injury or medical emergency is whether an employee is entitled to take family responsibility leave because their relative has a pre-planned or so-called elective
surgery. Because the surgery is scheduled ahead of time, it is not a medical emergency
. However, because, generally speaking, people undergo surgery for the treatment or prevention of a medical condition, it is Program policy that most surgeries, including those that are pre-planned or elective, that are performed to address or prevent manifestation of a medical condition (e.g., laser eye surgery to correct poor distance vision) are because of an illness or injury. Consequently, an employee is entitled to family responsibility leave if a specified relative of the employee undergoes pre-planned or elective
surgery. This does not include medically unnecessary plastic surgeries that are performed for purely cosmetic reasons and that are not related to an underlying illness or injury; these types of surgeries are not because of an illness or injury.
Another issue that arises concerns doctor's appointments. An employee’s relative who has an appointment for an annual check-up would generally not trigger an entitlement to leave for the employee unless it has been scheduled in respect of an illness, injury or medical emergency. However, if the relative had regularly scheduled appointments for the treatment or management of a chronic medical condition such as Crohn's disease or diabetes, those appointments would trigger an entitlement for the employee because they are absences related to an illness.
In the case of a relative for whom an employee may take family responsibility leave, the employer’s right to request evidence that the employee is eligible to take the leave will be limited. See s. 50.0.1(7) for more details.
see Designating Absences as Family Responsibility Leave
.
One of the events that entitle an employee to family responsibility leave is an urgent matter
that concerns any of the people listed in s. 50.0.1(3). Urgent matter is not defined in the Employment Standards Act 2000. It is Program policy that one of the traits of an urgent matter
is that the event be unplanned or out of the employee's control, and raise the possibility of serious negative consequences, including emotional harm, if it is not responded to. For example, it is an urgent matter if:
Some examples of situations that are not an urgent matter include:
While both of these events are out of the employee's control, the employee's inability to attend these events does not raise the possibility of serious negative consequences.
When determining whether an event is an urgent matter, an objective standard is applied. That is, the employee's subjective perception of the urgency of the matter is not determinative. However, subjective factors and circumstances that are particular to the individual employee should be taken into account. The question to ask is, would a reasonable employee in the same circumstances as the employee in question have felt that the matter was an urgent one?
Section 50.0.1(1) entitles employees to a family responsibility leave if there is an illness, injury, medical emergency or urgent matter concerning a person specified in paragraphs 1 to 7 of subsection 50.0.1(3), including a relative of the employee who is dependent on the employee for care or assistance
.
The Employment Standards Act, 2000 does not specify how close the familial relationship has to be in order to meet this criterion. The person must only be a relative
. In the absence of a definition of relative, the term must be interpreted in accordance with its plain, ordinary grammatical sense and general acceptance.
Black's Law Dictionary, 10th ed., defines the term relative, as follows:
A person connected with another by blood or affinity; a person who is kin with another. Accordingly, it is Program policy that to be a relative of an employee, the individual should be related through blood or through marriage, adoption or common law relationships between people of the same or opposite sex who are not married. Conversely, it is Program policy that relative
in s. 50(2), paragraph 7 will not include those individuals who are not connected either by blood or through marriage, adoption or a common law relationship, since including them would be extending the meaning of relative beyond the ordinary, commonly understood meaning.
With respect to common law relationships, the question arises as to how long the individuals have to live together in a conjugal relationship before it can be said that a spousal relationship exists, thus granting relative status to relatives of the employee's spouse. The answer is that there is no minimum amount of time that the individuals must be together in order to qualify as a common law spouse for the purpose of entitlement to personal emergency leave. Unlike the Family Law Act, RSO 1990, c F.3 which, for the purposes of support obligations, limits the definition of unmarried spouse
to those people who have lived together continuously for three years or are in a relationship of some permanence if they are the birth or adoptive parents of a child, s. 45 of the ESA 2000 requires only that the individuals live together in a conjugal relationship outside marriage
.
Accordingly, it is Program policy that the relationship of relative can be established through a common law relationship between people of the same or opposite sex once there is a conjugal relationship, regardless of how long it has been. (Note that the entitlement to family responsibility leave does not arise solely by virtue of the illness, injury, medical emergency or urgent matter of a relative. If that relative is not in a category specified in paragraphs 1 through 6, that relative must be dependent on the employee for care or assistance before there is an entitlement to family responsibility leave. See the discussion below).
An employee is entitled to take family responsibility leave with respect to the illness, injury, medical emergency or urgent matter of an individual not in a category specified in paragraphs 1 through 6, only where that individual is a relative who is dependent on the employee for care or assistance
. The ESA 2000 does not specify how dependent a relative has to be on the employee for this provision to apply. It only requires that there be a dependence for care or assistance. As individuals can be dependent on one another for care or assistance without being entirely dependent on that person, it is Program policy that this provision will apply to any relative who is reliant on the employee to some degree for care or assistance in meeting their basic living needs. The relative does not have to be completely reliant on the employee for all of their needs for this provision to apply.
There is no requirement that the relative be living with the employee for this provision to apply.
The type of event that entitles an employee to a family responsibility leave does not have to relate to the particular type of dependence the relative has on the employee in order to meet this criteria. For example, an employee's great-uncle depends on the employee to purchase his prescriptions and ensure he takes his medication. The employee wants to take family responsibility leave because her great-uncle's house is broken into and he needs assistance. The employee will be entitled to family responsibility leave even though the matter that is being responded to (a break-in) is unrelated to the type of dependence (ensuring that medication is taken).
This section provides that where an employee qualifies for a leave under this section, he or she entitled to take up to three days of family responsibility leave every calendar year. The entitlement is to a total of three days of family responsibility leave per calendar year, not three days per relative.
The ESA 2000 does not place any restrictions with respect to whether the three days have to be taken consecutively or individually. Employees can take family responsibility leave in part days (although see s. 50.0.1(6), which allows employers to deem one day's leave to be taken when an employee takes part of a day off work for family responsibility leave), entire days, or in periods of more than one day.
The question arises as to whether the three-day entitlement should be prorated for employees who are part-time, or who started their employment partway through a calendar year but have been employed for at least two consecutive weeks. There is nothing in the legislation to suggest that employees who are eligible for family responsibility leave should be entitled to less than three days per calendar year in any of these situations. Accordingly, it is Program policy that pro-rating of the three day entitlement for part-time employees or employees who were hired partway through a calendar year is not permitted.
The ESA 2000 does not provide for the carryover of unused days of family responsibility leave from one calendar year over into the next calendar year. In other words, employees do not have a statutory right to “bank” unused family responsibility leave days year over year.
It is Program policy that an employee who quits or is terminated and who is subsequently re-hired by the same employer during the same calendar year is entitled to a new three-day entitlement after two consecutive weeks of employment upon their re-hire. This is the case even if the employee took some family responsibility leave during their first term of employment in that calendar year.
See Greater Right or Benefit
at Part III, s. 5(2) for a discussion of the application of the greater right or benefit
provision to family responsibility leave. See also the discussion at ss. 50.0.1(8) — (10) for information regarding the interplay between contractual leave entitlements and statutory entitlements to family responsibility leave where the contractual leave does not amount to a greater right or benefit
.
Section 50.0.1(4) requires employees to tell their employers ahead of time that they will be taking family responsibility leave. In circumstances where that cannot be done, the employee is required, pursuant to s. 50.0.1(5), to inform the employer as soon as possible after beginning the leave.
The ESA 2000 does not require the employee to advise the employer of the family responsibility leave in writing. Oral notice is sufficient.
The ESA 2000 does not specify any particular method by which the employer is to be advised that the employee will be taking family responsibility leave. Consequently, an employee would be complying with this section whether they, for example, advised the employer by phone, left a note on the manager's desk or had a colleague take a message to the employer on their behalf.
Employees do not lose their right to family responsibility leave if they fail to comply with ss. 50.0.1(4) or (5). An employee's entitlement to family responsibility leave arises by virtue of one of a number of triggering events
arising involving a particular family member, and it is the Program's position that the failure to advise the employer before or as soon as possible after the leave begins does not negate that entitlement. This approach is consistent with the Program's long-standing policy in the pregnancy and parental leave context, where the structure of the entitlement and notice provisions are similar to these. See ESA 2000 Part XIV, s. 46(4) and s. 48(4).
An issue has arisen as to whether an employer can penalize an employee for failing to give advance notice that they will be absent from work (as may be required under an employer policy), where the time off is a family responsibility leave under the ESA 2000. Sections 50.0.1(1) and (3) describe the employee's entitlement (i.e., the triggering event
and with respect to which individuals). Section 50.0.1(4) requires the employee taking family responsibility leave to advise the employer that they are taking the leave, and s. 50.0.1(5) provides that if the employee must begin the leave before advising the employer, the employee shall advise the employer of the leave as soon as possible after beginning it.
It is clear from s. 50.0.1(5) that the ESA 2000 contemplates situations where the employee would be unable to advise the employer in advance of commencing the family responsibility leave. Part of the family responsibility leave entitlement under the ESA 2000 is the right to take the family responsibility leave even if advance notice cannot be given, with the proviso that the employee must advise the employer of the leave as soon as possible after beginning it.
The failure to give notice in advance of taking leave, when it would have been possible for the employee to do so, can be the subject of disciplinary action by the employer without violating s. 74 (the anti-reprisal provision). However, the following points should be considered:
In addition, an employer would be able to impose discipline if an employee fails to provide any notice of the family responsibility leave, or if the employee provides notice of the leave so late that one wouldn’t reasonably be able to say that it falls within s. 50.0.1(5). Again, however, the employer's disciplinary action would have to be appropriate, and in no way a penalty or reprisal for the employee having taken the leave, but only for the failure to give notice. In this regard see Ryding-Regency Meat Packers Ltd. v. U.F.C.W., Local 1000A. In that case, the arbitrator concluded that in relation to the former personal emergency leave, the ESA established an entitlement to leave where a person described under the personal emergency leave provisions was ill. The fact that the employee's grandmother was ill was not disputed. Because the sections of the ESA that created the entitlement were separate from the notice requirements, the employee could be disciplined for not giving notice that he was taking or had taken leave but did not lose his entitlement to take the leave itself.
For employees who are entitled to sick leave as provided for in s. 50, questions have arisen as to whether an employee who is absent from work for one of the reasons listed in s. 50(1) must use one of their three days of sick leave.
Subsection (7) provides that where an employee takes a paid or unpaid leave of absence under an employment contract in circumstances for which the employee would also be entitled to take a leave under s. 50, the employee is deemed to have taken a leave under s. 50. Subsections (8) and (9) establish rules that apply to the deemed leave.
Accordingly, if subsections (7)-(9) apply to an absence, i.e. an employee takes paid or unpaid leave under the contract of employment in circumstances in which sick leave could be taken, the employee will be deemed pursuant to ss. 50(7) to have taken ESA sick leave and drawn down against statutory the three-day s. 50 entitlement. (See the discussion under s. 50 (7)–(9) for more information regarding the impact of contractual entitlements on the statutory right to sick leave.)
On the other hand, if subsections (7)-(9) do not apply, i.e. an employee who is entitled to sick leave is absent due to one of the reasons listed in s. 50(1) but does not take a paid or unpaid leave of absence under an employment contract for that absence (either because the employee does not have a contractual right or does not exercise it), it is the employee (not the employer) who decides whether to designate the absence as a statutory sick leave.
If the employee who is entitled to sick leave and who is absent from work due to one of the reasons listed in s. 50(1) wishes to designate the absence as a statutory sick leave, then the absence is a sick leave that draws down against the three-day statutory entitlement and attracts the corresponding reprisal protections (and all of the other ancillary rights that attach to statutory leaves that are set out in s. 51-53.1)
In the case where s. (7)-(9) do not apply, an employee may be entitled to statutory sick leave and be absent from work due to one of the reasons listed in s. 50(1) and decide not to claim the absence as a sick leave day. This is not considered as contracting out of the ESA 2000 if an employee does not take advantage of their leave entitlements; the employee has merely chosen not to exercise them.
If the employee who is entitled to sick leave by virtue of being absent from work due to one of the reasons listed in s. 50(1) does not wish to designate the absence as a sick leave, and the absence cannot be considered an authorized absence on some other ground (e.g., another leave under the ESA 2000 or vacation authorized by the employer), the absence would have no statutory reprisal protection. For this reason, an employee who takes a day off for a reason that would qualify under s. 50 but who would prefer not to have the day charged against their sick leave allotment may feel effectively forced into designating the day as such a leave. This in itself does not constitute any violation of the ESA 2000: it is not unlawful for an employer to inform an employee that should the employee not designate an absence as a statutory sick leave day, then it would be considered an unexcused absence that will lead to disciplinary action.
Note that if the employee did not know of the right to take sick leave, the default is that the absence is considered to be statutory sick leave with the corresponding reprisal protection. An employee does not lose their right to any of the leaves provided for under the ESA 2000 because they were unaware of their entitlements.
Employees may not need an entire work day to attend to the event that gave rise to the family responsibility leave, and might only take part of a day off as family responsibility leave. Section 50.0.1(6) allows an employer in this situation to count the part-day off work as an entire day's leave for the purpose of counting the absence against the statutory three-day leave entitlement. This is the only purpose for which the employer can deem the part day off work as an entire day's leave. The employer cannot deem the employee not to have worked at all on the day. Where an employee worked a partial day and took a part-day of family responsibility leave, the employee is entitled to be paid the earnings for the time that was actually worked that day. As well, the hours that were worked will be counted for the purposes of, among other things, determining whether the relevant overtime threshold has been reached, whether the limits on, for example, the daily and weekly hours of work have been reached, and whether the daily, weekly/bi-weekly and in-between shifts rest requirements have been met.
For clarity, this provision does not require employees to take family responsibility leave in full day periods. It simply allows an employer to reduce the employee’s three-day entitlement by a day if an employee is on family responsibility leave for only part of a day.
Note that this provision allows the employer to attribute one day’s leave to a part-day absence. It does not require the employer to do so.
For example, an employee goes home early from work because her child has the stomach flu. She worked a four-hour day rather than her usual eight hours and takes family responsibility leave. In that case, the employer may consider the employee to have used up one of her three days of family responsibility leave and the employee would be paid her earnings for the four hours she actually worked.
Just because an employer may consider an employee to have used one day of leave due to a part day of absence does not mean that the employee then has the right to take the entire day off if the triggering event did not last the entire day. For example, an employee's shift is from 9 a.m. to 5 p.m. He has to meet with his son's school principal on an urgent matter from 10 a.m. to 11 a.m. The employee claims the absence as family responsibility leave. His employer is entitled to count the absence as an entire day's family responsibility leave, but the employee must nevertheless return to work after the meeting is over. Employees have the right to be away from work under the family responsibility leave provisions of the ESA 2000 only for as long as the need lasts. After the triggering event is over, the employee's normal obligations to attend at work are resumed.
In addition, employers cannot prohibit employees who took a part day of leave from returning to work for the remainder of their shift (This is because, among other reasons, the employer’s s. 53 obligation to reinstate the employee at the end of the leave and the s. 74 prohibition against penalizing employees for having taken a leave.)
An issue has arisen as to whether an employer could exercise its discretion and deem a partial day absence as a full day for some employees, but not for others, or whether this might allow employers to selectively punish employees who have too many absences in violation of the reprisal provisions of the ESA 2000.
The answer will depend on the facts. In particular, why did the employer treat the employees differently? Where an employer deems a full day's absence for some employees, but not for others, it is a question of fact as to whether the employer would be in violation of the ESA 2000.
For instance, an employer counts a three-hour family responsibility leave as a full day's leave for employee A but not for employee B who also takes a three-hour family responsibility leave because the employer considers employee B to be a better worker than employee A. Although this might be unfair as between employee A and B, it would not be a violation of the ESA 2000, as it would not be a reprisal for exercising a right under the ESA 2000.
If, on the other hand, the motivation for the differential treatment was that Employee A frequently took family responsibility leave every year of only a few hours, and the employer assigned a full day's absence to these short leaves as a way to ensure employee A used up all of their statutory entitlement as soon as possible because the employer found it inconvenient for the employee to be away for short periods of time, that would be an unlawful reprisal.
As another example, it would also be an unlawful reprisal if the motive for the differential treatment was because employee A made inquiries about ESA rights or refused to agree to average hours for overtime pay purposes.
Subsection 50.0.1(7) gives an employer an ability to require an employee to provide proof that they are or were entitled to take family responsibility leave. The employer can require an employee to provide evidence that is reasonable in the circumstances that they are or were entitled to take the leave.
Evidence of entitlement to family responsibility leave may take many forms. For example, it could be a note from a daycare provider, school or other care facility. Receipts could also constitute proof , e.g., an invoice from a plumber who was called in to deal with a parent’s flooded basement.
Where the family responsibility leave was for the illness, injury or medical emergency of a person listed in s. 50.0.1(3), the employer cannot require a medical certificate or note in respect of that person — that person is not the employee of the employer and has no obligation to share his or her medical information. (Note that it is different in the family medical leave, family caregiver leave, and critical illness leave contexts. In those cases, the ESA, 2000 specifically states that the employee must obtain a medical certificate providing certain information about the family member and provide a copy of the certificate to the employer upon request.)
Evidence that is reasonable in the circumstances will be fact-specific. The factors and principles that may be relevant when assessing reasonableness
are:
Note that any evidence the employee provides to support the employee’s claim of an entitlement to family responsibility leave is just that — evidence — and is not necessarily determinative of the question of whether the employee had an entitlement. Depending on the circumstances, it may be reasonable for the employer to require additional evidence from the employee.
The Youth Criminal Justice Act, SC 2002, c 1(YCJA
) prohibits the disclosure of any information that may identify a young person who has committed or is alleged to have committed an offence, a young person who is a victim of the offence, or a young person who is called as a witness in any proceeding in connection with the alleged offence. Employees who take a family responsibility leave because a young person specified in s. 50.0.1(3) is involved in a YCJA matter are not obliged to divulge to the employer (or employment standards officer) any information regarding the identity of the young person (e.g., the name or their relationship to the employee). Instead, it is Program policy that it would be reasonable in the circumstances that the employee state that a relative was involved in a court proceeding.
These provisions, when read together, establish what happens when an employee takes a leave of absence under an employment contract in circumstances that would also entitle the employee to a leave under s. 50.0.1 of the ESA.
“Circumstances” refers only to the triggering event that would entitle the employee to statutory family responsibility leave (i.e. the employee is absent because of an event listed ins. 50.0.1(1) and the event relates to a person listed ins. 50.0.1(3).)
It is Program policy that “circumstances” does not include the two-week employment eligibility criterion. Accordingly, these provisions will be triggered when an employee takes a leave of absence under an employment contract due to an event listed ins. 50.0.1(1) where the event relates to a person listed ins. 50.0.1(3), even during the first two weeks of employment; this is the case regardless of the fact that the employee does not have the right to take statutory family responsibility leave during this time.
Subsections 8 to 10 codify the long-standing Program policy on the interplay between contractual leave entitlements and statutory leave entitlements where the contractual leave does not amount to a greater right or benefit than statutory family responsibility leave under s. 5(2).
(Note that if a contract does provide a greater right or benefit than the statutory family responsibility leave entitlement — the determination of which includes consideration of reprisal protections and the entitlements under general provisions concerning leaves
such as the right to reinstatement — the contractual leave provision applies and s. 50.0.1, including these subsections, does not apply. See the discussion of s. 5(2) for details.)
In general terms, subsections (8)-(10) provide that an employee who claims a contractual benefit for an absence — in circumstances in which the employee would also be entitled to take family responsibility leave for does not have an entitlement to those contractual absences plus an additional three days of family responsibility leave.
If an employee takes a paid or unpaid leave of absence under an employment contract in circumstances for which he or she would also be entitled to take a leave under section 50.0.1, the employee is deemed to have taken a day of family responsibility leave and the absence will reduce the employee’s three-day per calendar year family responsibility leave allotment accordingly. Note that this provision must be read in conjunction with subsections (9) and (10), discussed below.
For this provision to apply, the reason for the absence (i.e. the “triggering event”) and the person in respect of whom the absence is related, must qualify for both the contractual leave and the statutory leave.
Some examples:
This provision only has the potential to deem a statutory leave to be taken when a contractual leave is taken. It does not do the converse: it does not deem a contractual leave to be taken if a statutory leave is taken in circumstances for which the employee would also be entitled to take a contractual leave. The question as to whether statutory absences will also draw down against the contractual right is not a matter for the employment standards program.
If an absence has been deemed to be a statutory leave under ss. 50.0.1(8), this provision establishes that all requirements and prohibitions under the ESA, 2000 apply to the absence.
This includes all requirements and prohibitions in section 50.0.1 as well as general rights and obligations found in other sections and/or Parts of the Act.
Examples include: the right to reinstatement, maintenance of benefits (if relevant), protection from reprisal, obligations on the employee with respect to advising the employer of the leave and providing evidence reasonable in the circumstances to demonstrate an entitlement to the leave (where required by the employer).
This provision states that subsection (6) applies, with necessary modifications, to a leave that is deemed to be a family responsibility leave pursuant to subsection (8).
This means that if an employee takes a partial-day leave pursuant to his or her contract of employment, and that leave is deemed to be a day of family responsibility leave under subsection 8, the employer may deem the absence to be a full day of family responsibility leave and reduce the employee’s 3-day per calendar year allotment
of family responsibility days accordingly.
The bereavement leave provisions were introduced into the Employment Standards Act, 2000 effective January 1, 2019 by the Making Ontario Open for Business Act, 2018.
Sections 50.0.2(1) and 50.0.2(3) set out the qualifying conditions an employee must meet in order to be entitled to an unpaid bereavement leave. To qualify, the employee must have been employed by the employer for at least two consecutive weeks, and the need for the leave must be because of the death of an individual specified in subsection (3).
Note that, pursuant to section 3 of Ontario Regulation 285/01, certain employees who meet the qualifying criteria for a bereavement leave will not be entitled to take it if taking it would constitute an act of professional misconduct or a dereliction of professional duty. Section 3 of Ontario Regulation 285/01 reads:
3. Sections 50, 50.0.1 and 50.0.2 of the Act do not apply to any of the following persons in circumstances in which the exercise of the entitlement would constitute an act of professional misconduct or a dereliction of professional duty:
See section 3 of Ontario Regulation 285/01 for more information.
Subsections 50.0.2(1) and 50.0.2(3) lists the event (because of
a death), and the people to whom the event must relate, that entitle employees who have been employed for at least two consecutive weeks to take bereavement leave. The list of relatives in subsection (3) is exhaustive. If it was not a listed relative who has died, the employee is not entitled to bereavement leave. If the employee has not been employed for at least two consecutive weeks, the employee is not entitled to a bereavement leave.
Employees can take a bereavement leave, without pay, because of the death of certain listed individuals. Because of
is broad wording and can capture many different reasons for requiring time off work. For example, an employee may need time off work to attend a funeral or memorial service; in the case of an employee who is an estate trustee, the employee may need time off to deal with the estate; or the employee may simply be in mourning.
One issue that arises in respect of bereavement leave taken because of the death of a specified family member or dependent relative is whether the leave days must be taken coincident with the death, or can be taken at some later time. Section 50.0.2(1) states that an employee is entitled to the leave because of
the death of an individual listed in s. 50.0.2(3). As a result, time off work to attend a burial, interment of ashes or memorial service for the deceased that occurs at any time after the death qualifies as a bereavement leave as it is taken because
of the death.
To be entitled to a bereavement leave, the person who died must be listed in subsection (3):
The terms parent
and spouse
are defined in section 45 of the Employment Standards Act, 2000 – see Part XIV, section 45.
If a person in the list above has not died, or if the person who has died is not found in the above-list, the employee is not entitled to take a bereavement leave.
Section 50.0.2(1) entitles employees to a bereavement leave because of the death of a person specified in paragraphs 1 to 7 of subsection 50.0.2(3), including a relative of the employee who is dependent on the employee for care or assistance
.
The Employment Standards Act, 2000 does not specify how close the familial relationship has to be in order to meet this criterion. The person must only be a relative
. In the absence of a definition of relative, the term must be interpreted in accordance with its plain, ordinary grammatical sense and general acceptance.
Black's Law Dictionary, 10th edition, defines the term relative, as follows:
A person connected with another by blood or affinity; a person who is kin with another. Accordingly, it is Program policy that to be a relative of an employee, the individual should be related through blood or through marriage, adoption or common law relationships between people of the same or opposite sex who are not married. Conversely, it is Program policy that relative
in s. 50.0.2(3)), paragraph 7 will not include those individuals who are not connected either by blood or through marriage, adoption or a common law relationship, since including them would be extending the meaning of relative beyond the ordinary, commonly understood meaning.
With respect to common law relationships, the question arises as to how long the individuals have to live together in a conjugal relationship before it can be said that a spousal relationship exists, thus granting relative status to relatives of the employee's spouse. The answer is that there is no minimum amount of time that the individuals must be together in order to qualify as a common law spouse for the purpose of entitlement to personal emergency leave. Unlike the Family Law Act, RSO 1990, c F.3 which, for the purposes of support obligations, limits the definition of unmarried spouse
to those people who have lived together continuously for three years or are in a relationship of some permanence if they are the birth or adoptive parents of a child, s. 45 of the ESA 2000 requires only that the individuals live together in a conjugal relationship outside marriage
.
Accordingly, it is Program policy that the relationship of relative can be established through a common law relationship between people of the same or opposite sex once there is a conjugal relationship, regardless of how long it has been. (Note that the entitlement to bereavement leave does not arise solely because of the death of a relative. If that relative is not in a category specified in paragraphs 1 through 6, that relative must have been dependent on the employee for care or assistance before his/her death in order for there to be an entitlement to bereavement leave. See the discussion below).
An employee is entitled to take bereavement leave because of the death of an individual not in a category specified in paragraphs 1 through 6, only where that individual is a relative who is dependent on the employee for care or assistance
. It is Program policy, that in the bereavement leave context, the question to answer is whether the individual is a relative who was dependent on the employee for care or assistance at some point when the relative was alive. The Employment Standards Act, 2000 does not specify how dependent a relative had to have been on the employee for this provision to apply. It only requires that there have been a dependence for care or assistance. As individuals can be dependent on one another for care or assistance without being entirely dependent on that person, it is Program policy that this provision will apply to any relative who had been reliant on the employee to some degree for care or assistance in meeting their basic living needs. The relative did not have to be completely reliant on the employee for all of his or her needs when he or she was alive for this provision to apply.
There is no requirement that the deceased relative have previously lived with the employee for this provision to apply.
For employees who are entitled to bereavement leave as provided for in section 50.0.2, questions have arisen as to whether an employee who is absent from work for the reason listed in section 50.0.2(1) must use one of their two days of bereavement leave. A discussion of this issue is set out at subsection 50.0.2(4) below – see Designating Absences as Bereavement Leave
.
This section provides that where an employee qualifies for a leave under this section, he or she is entitled to take up to two days of bereavement leave each calendar year. The entitlement is to a total of two days of bereavement leave per calendar year, not two days per relative.
The Employment Standards Act, 2000 does not place any restrictions with respect to whether the two days have to be taken consecutively or individually. Employees can take bereavement leave in part days (although see section 50.0.2(6), which allows employers to deem one day's leave to be taken when an employee takes part of a day off work for bereavement leave), entire days, or in periods of more than one day.
The question arises as to whether the two-day entitlement should be prorated for employees who are part-time, or who started their employment partway through a calendar year but have been employed for at least two consecutive weeks. There is nothing in the legislation to suggest that employees who are eligible for bereavement leave should be entitled to less than two days a calendar year in any of these situations. Accordingly, it is Program policy that pro-rating of the two-day entitlement for part-time employees or employees who were hired partway through a calendar year is not permitted.
The Employment Standards Act, 2000 does not provide for the carryover of unused days of bereavement leave from one calendar year over into the next calendar year. In other words, employees do not have a statutory right to “bank” unused bereavement leave days year over year.
It is Program policy that an employee who quits or is terminated and who is subsequently re-hired by the same employer during the same calendar year is entitled to a new two-day entitlement, after two consecutive weeks of employment upon their re-hire. This is the case even if the employee took some bereavement leave during their first term of employment in that calendar year.
See Greater Right or Benefit
at Part III, section 5(2) for a discussion of the application of the greater right or benefit
provision to bereavement leave. See also the discussion at ss. 50.0.2(8) – (10) for information regarding the interplay between contractual leave entitlements and statutory entitlements to bereavement leave where the contractual leave does not amount to a greater right or benefit
.
Section 50.0.2(4) requires employees to tell their employers ahead of time that they will be taking a bereavement leave. In circumstances where that cannot be done, the employee is required, pursuant to s. 50.0.2(5), to inform the employer as soon as possible after beginning the leave.
The ESA 2000 does not require the employee to advise the employer of the bereavement leave in writing. Oral notice is sufficient.
The ESA 2000 does not specify any particular method by which the employer is to be advised that the employee will be taking bereavement leave. Consequently, an employee would be complying with this section whether they, for example, advised the employer by phone, left a note on the manager's desk or had a colleague take a message to the employer on their behalf.
An employee does not lose their right to bereavement leave if they fail to comply with ss. 50.0.2(4) or (5). An employee's entitlement to bereavement leave arises by virtue of one of a number of particular family members having died and the employee taking leave because of the death; it is the Program's position that the failure to advise the employer before or as soon as possible after the leave begins does not negate that entitlement. This approach is consistent with the Program's long-standing policy in the pregnancy and parental leave context, where the structure of the entitlement and notice provisions are similar to these. See ESA 2000 Part XIV, s. 46(4) and s. 48(4).
An issue has arisen as to whether an employer can penalize an employee for failing to give advance notice that they will be absent from work (as may be required under an employer policy), where the time off is a bereavement leave under the ESA 2000. Sections 50.0.2(1) and (3) describe the employee's entitlement (i.e., that the employee takes a leave because of the death of a particular family member). Section 50.0.2(4) requires the employee taking bereavement leave to advise the employer that they are taking the leave, and s. 50.0.2(5) provides that if the employee must begin the leave before advising the employer, the employee shall advise the employer of the leave as soon as possible after beginning it.
It is clear from s. 50.0.2(5) that the ESA 2000 contemplates situations where the employee would be unable to advise the employer in advance of commencing the bereavement leave. Part of the bereavement leave entitlement under the ESA 2000 is the right to take bereavement leave even if advance notice cannot be given, with the proviso that the employee must advise the employer of the leave as soon as possible after beginning it.
The failure to give notice in advance of taking leave, when it would have been possible for the employee to do so, can be the subject of disciplinary action by the employer without violating s. 74 (the anti-reprisal provision). However, the following points should be considered:
In addition, an employer would be able to impose discipline if an employee fails to provide any notice of the bereavement leave, or if the employee provides notice of the leave so late that one wouldn’t reasonably be able to say that it falls within s. 50.0.2(5). Again, however, the employer's disciplinary action would have to be appropriate, and in no way a penalty or reprisal for the employee having taken the leave, but only for the failure to give notice. In this regard see Ryding-Regency Meat Packers Ltd. v. U.F.C.W., Local 1000A. In that case, the arbitrator concluded that in relation to the former personal emergency leave, the ESA established an entitlement to leave where a person described under the personal emergency leave provisions was ill. The fact that the employee's grandmother was ill was not disputed. Because the sections of the ESA that created the entitlement were separate from the notice requirements, the employee could be disciplined for not giving notice that he was taking or had taken leave but did not lose his entitlement to take the leave itself.
For employees who are entitled to bereavement leave as provided for ins. 50.0.2, questions have arisen as to whether an employee who is absent from work because of the death of a family member listed inss. (3) must use one of their two days of bereavement leave.
Subsection (8) provides that where an employee takes a paid or unpaid leave of absence under an employment contract in circumstances for which the employee would also be entitled to take a leave unders. 50.0.2, the employee is deemed to have taken a leave unders. 50.0.2. Subsections (9) and (10) establish rules that apply to the deemed leave.
Accordingly, if subsections (8)-(10) apply to an absence, i.e. an employee takes paid or unpaid leave under the contract of employment in circumstances in which bereavement leave could be taken, the employee will be deemed pursuant toss. 50(8) to have taken ESA bereavement leave and drawn down against the two-days. 50.0.2 entitlement. (See the discussion underss. 50 (8)–(10) for more information regarding the impact of contractual entitlements on the statutory right to bereavement leave.)
On the other hand, if subsections (8)-(10) do not apply, i.e. an employee who is entitled to bereavement leave is absent because of the death of a family member who is listed inss. (3) but does not take a paid or unpaid leave of absence under an employment contract for that absence (either because the employee does not have a contractual right or does not exercise it), it is the employee (not the employer) who decides whether to designate the absence as a statutory bereavement leave.
If the employee who is entitled to bereavement leave and who is absent from work because of the death of a family member who is listed inss. (3) wishes to designate the absence as a statutory bereavement leave, then the absence is a bereavement leave that draws down against the two-day statutory entitlement and attracts the corresponding reprisal protections (and all of the other ancillary rights that attach to statutory leaves that are set out inss. 51-53.1)
In the case wheress. (8)-(10) do not apply, an employee may be entitled to statutory bereavement leave and be absent from work because of the death of a family member listed inss. (3) and decide not to claim the absence as a bereavement leave day. This is not considered as contracting out of the ESA 2000 if an employee does not take advantage of their leave entitlements; the employee has merely chosen not to exercise them.
If the employee who is entitled to bereavement leave by virtue of being absent from work because of the death of a family member listed inss. (3) does not wish to designate the absence as a bereavement leave, and the absence cannot be considered an authorized absence on some other ground (e.g., another leave under the ESA 2000 or vacation authorized by the employer), the absence would have no statutory reprisal protection. For this reason, an employee who takes a day off for a reason that would qualify under section 50.0.2 but who would prefer not to have the day charged against their bereavement leave allotment may feel effectively forced into designating the day as such a leave. This in itself does not constitute any violation of the ESA 2000: it is not unlawful for an employer to inform an employee that should the employee not designate an absence as a statutory bereavement leave day, then it would be considered an unexcused absence that will lead to disciplinary action.
Note that if the employee did not know of the right to take bereavement leave, the default is that the absence is considered to be statutory bereavement leave with the corresponding reprisal protection. An employee does not lose their right to any of the leaves provided for under the ESA 2000 because they were unaware of their entitlements.
Employees may not need an entire day off work because of the death of a listed relative. As such, an employee may take only part of a day off as bereavement leave. Section 50.0.2(6) allows an employer in this situation to count the part-day off work as an entire day's leave for the purpose of counting the absence against the statutory two-day leave entitlement. This is the only purpose for which the employer can deem the part day off work as an entire day's leave. The employer cannot deem the employee not to have worked at all on the day. Where an employee worked a partial day and took a part-day of bereavement leave, the employee is entitled to be paid the earnings for the time that was actually worked that day. As well, the hours that were worked will be counted for the purposes of, among other things, determining whether the relevant overtime threshold has been reached, whether the limits on, for example, the daily and weekly hours of work have been reached, and whether the daily, weekly/bi-weekly and in-between shifts rest requirements have been met.
For clarity, this provision does not require employees to take bereavement leave in full day periods. It simply allows an employer to reduce the employee’s two-day entitlement by a day if an employee is on bereavement leave for only part of a day.
Note that this provision allows the employer to attribute one day's leave to a part day of absence. It does not require the employer to do so.
For example, the employee may find out in the afternoon that her sister has died and consequently leave work early that day. If she worked a four-hour day rather than her usual eight hours and takes bereavement leave, her employer may consider the employee to have used up one of her two days of bereavement leave and the employee would be paid her earnings for the four hours she actually worked.
In addition, employers cannot prohibit employees who took a part day of leave from returning to work for the remainder of their shift. (This is because, among other reasons, the employer’s ss. 53 obligation to reinstate the employee at the end of the leave and the ss. 74 prohibition against penalizing employees for having taken a leave.)
Subsection 50.0.2(7) gives an employer an ability to require an employee to provide proof that they are or were entitled to take bereavement leave. The employer can require an employee to provide evidence that is reasonable in the circumstances that they are or were entitled to take the leave.
Evidence of entitlement to bereavement leave may take different forms, including a copy of a death certificate or statement from a funeral home, a published obituary, printed program from a memorial service or proof of an appointment with a funeral director or lawyer.
Evidence that is reasonable in the circumstances will be fact-specific. The factors and principles that may be relevant when assessing reasonableness
are:
These provisions, when read together, establish what happens when an employee takes a leave of absence under an employment contract (which includes a collective agreement) in circumstances that would also entitle the employee to a leave under s. 50.0.2 of the ESA.
Circumstances
refers only to the triggering event that would entitle the employee to statutory bereavement leave (i.e. the employee is absent because of the death of an individual listed ins. 50.0.2(3).)
It is Program policy that “circumstances” does not include the two-week employment eligibility criterion. Accordingly, these provisions will be triggered when an employee takes a leave of absence under an employment contract because of the death of an individual listed ins. 50.0.2(3), even during the first two weeks of employment; this is the case regardless of the fact that the employee does not have the right to take statutory bereavement leave during this time.
Subsections (8) to (10) codify the long-standing Program policy on the interplay between contractual leave entitlements and statutory leave entitlements where the contractual leave does not amount to a greater right or benefit than statutory bereavement leave under s. 5(2).
(Note that if a contract does provide a greater right or benefit than the bereavement leave entitlement — the determination of which includes consideration of reprisal protections and the entitlements under general provisions concerning leaves
such as the right to reinstatement — the contractual leave provision applies and s. 50.0.2, including these subsections, does not apply. See the discussion of s. 5(2) for details.)
In general terms, subsections (8)-(10) provide that an employee who claims a contractual benefit for an absence — in circumstances which the employee would also be entitled to take bereavement leave — does not give the employee an entitlement to those contractual absences plus an additional two days of bereavement leave.
If an employee takes a paid or unpaid leave of absence under an employment contract in circumstances for which he or she would also be entitled to take a leave under section 50.0.2, the employee is deemed to have taken a day of bereavement leave and the absence will reduce the employee’s two-day per calendar year bereavement leave allotment accordingly. Note that this provision must be read in conjunction with subsections (9) and (10), discussed below.
For this provision to apply, the reason for the absence (i.e. the “triggering event”) and the person in respect of whom the absence is related, must qualify for both the contractual leave and the statutory leave.
Some examples:
flex daysthat employees can use at their discretion. The employee is absent for two days because of the death of her sister and claims benefits under the employer's plan. Subsection (8) deems the employee to have used two ESA bereavement days.
flexday that can be used for any reason, and the employee uses that day to attend the memorial service of her great-aunt (who had not been dependent on the employee for care or assistance)the employee would not be deemed to have taken a day of bereavement leave pursuant to this provision. This is because a
great-auntis not a listed relative for whom a leave can be taken in s. 50.0.2 and, therefore, the contractual leave was not taken
in circumstances for which [the employee] would also be entitled to take a [bereavement leave].
This provision only has the potential to deem a statutory leave to be taken when a contractual leave is taken. It does not do the converse: it does not deem a contractual leave to be taken if a statutory leave is taken in circumstances for which the employee would also be entitled to take a contractual leave. The question as to whether statutory absences will also draw down against the contractual right is not a matter for the employment standards program.
If an absence has been deemed to be a statutory leave under subsection 50.0.2(8), this provision establishes that all requirements and prohibitions under the ESA, 2000 apply to the absence.
This includes all requirements and prohibitions in section 50.0.2 as well as general rights and obligations found in other sections and/or Parts of the Act.
Examples include: the right to reinstatement, maintenance of benefits (if relevant), protection from reprisal, obligations on the employee with respect to advising the employer of the leave and providing evidence reasonable in the circumstances to demonstrate an entitlement to the leave (where required by the employer).
This provision states that subsection (6) applies, with necessary modifications, to a leave that is deemed to be a bereavement leave pursuant to subsection (8).
This means that if an employee takes a partial-day leave pursuant to his or her contract of employment, and that leave is deemed to be a day of bereavement leave under subsection (8), the employer may deem the absence to be a full day of bereavement leave and reduce the employee’s 2-day per calendar year allotment
of bereavement leave days accordingly.
O. Reg. 228/20 created certain temporary rules under the ESA that applied during a defined “COVID-19 period”, including providing that employees were deemed to be on unpaid infectious disease emergency leave where specified conditions were met. The “COVID-19 period” began on March 1, 2020 and ended on July 30, 2022. As such, employees are no longer deemed to be on this leave as of July 31, 2022. Reference to the provisions that deemed an employee to be on unpaid infectious disease emergency leave have been maintained in this publication since employment standards officers may still be required to make determinations with respect to occurrences arising during the COVID-19 period and the temporary deemed leave.
During a declared emergency, an employee may have the right to take declared emergency leave. Employees who will not be performing the duties of their position because of the declared emergency and because of certain specified circumstances related to the declared emergency are entitled to the leave. At the time of writing, there is no declared emergency in effect and so employees are not entitled to take this leave.
Section 50.1 was amended effective March 19, 2020 by the Employment Standards Amendment Act (Infectious Disease Emergencies), 2020 to expand emergency leave to cover infectious disease emergencies. Prior to the amendment, this section only addressed declared emergencies.
Although the amendment was effective on March 19, 2020, employees’ entitlements to unpaid infectious disease emergency leave for Coronavirus (COVID‑19) for reasons set out in subclauses (i)-(vi) of s. 50.1(1.1) are, by virtue of O. Reg. 228/20 (and initially by virtue of O. Reg. 66/20, which was later revoked and replaced by O. Reg. 228/20), retroactive to January 25, 2020.
Entitlement to infectious disease emergency leave where an employer temporarily reduces or eliminates a non-unionized employee’s hours of work for COVID‑19 related reasons as prescribed in section 4 of O.Reg. 228/20 was retroactive to March 1, 2020 and applied during the defined COVID‑19 period – see below for details.
Entitlement to infectious disease emergency leave was retroactive to July 24, 2020, where an employee was not performing the duties of their position because they were subject to an order related to COVID-19 that:
Section 50.1 was amended on April 29, 2021 by the COVID‑19 Putting Workers First Act, 2021 to provide employees with an additional entitlement of up to three paid days of infectious disease emergency leave in certain circumstances related to a designated infectious disease. Although the amendment came into force on April 29, 2021, employees’ entitlements to paid infectious disease emergency leave were retroactive to April 19, 2021. Entitlements to paid infectious disease emergency leave were originally set to end on September 25, 2021 but were subsequently extended to December 31, 2021, to July 31, 2022 and then again to March 31, 2023. The ESA was also amended on April 29, 2021 to provide that an eligible employer is entitled to be reimbursed the amount of infectious disease emergency leave pay that they paid to their employees, up to $200 per employee per day taken. Eligible employers make their application for reimbursement to the Workplace Safety and Insurance Board – see the discussion of s. 50.1.1 for details.
These terms are used only in the infectious disease emergency leave context. See the discussion of the infectious disease emergency leave provisions for information on the meaning of these terms.
During a declared emergency, an employee may have the right to take declared emergency leave. Employees who will not be performing the duties of their position because of the declared emergency and because of certain specified circumstances related to the declared emergency are entitled to the leave. At the time of writing, there is no declared emergency in effect and so employees are not entitled to take this leave.
On June 30, 2006, the Employment Standards Act, 2000 was amended by the Emergency Management Statute Law Amendment Act, 2006, SO 2006, c 13, to create a new unpaid leave called, "emergency leave, declared emergencies", which the Program refers to as "declared emergency leave".
Declared emergency leave is available only if the Premier or Lieutenant Governor in Council declares an emergency under section 7.0.1 of the Emergency Management and Civil Protection Act (and only if the eligibility criteria set out in clause 50.1(1.1)(a) are then met).
The Lieutenant Governor in Council declared an emergency because of COVID-19 on March 17, 2020. The emergency declaration was terminated on July 24, 2020. A second emergency was declared because of COVID-19 on January 12, 2021 and terminated on February 9, 2021. A third emergency was declared because of COVID-19 on April 7, 2021 and terminated on June 2, 2021.
Employees who will not be performing the duties of their position because of the declared emergency and because of certain specified circumstances related to the declared emergency are entitled to an unpaid, job-protected declared emergency leave.
During a declared emergency, the Lieutenant Governor in Council, in certain circumstances and with certain limitations, may make orders under s. 7.0.1 7.0.2 of the EMCPA that it believes are necessary and essential in the circumstances to prevent, reduce or mitigate serious harm to persons or substantial damage to property.
The condition in subclause (i) of s. 50.1(1.1)(a) will be met if an order made under s. 7.0.1 7.0.2 of the EMCPA applies to the employee and there is a causal connection between the order and the employee not performing the duties of the employee’s position.
The Program considers an order to “appl[y] to” an employee only if the order is directed at the employee, i.e., where the employee, either individually or as part of a group, is the subject of the requirement, prohibition or other direction made in the order.
In other words, this condition is not satisfied if an employee is only indirectly affected by the order or by the consequences of someone else complying with the order.
For example, an order that requires restaurants to close “applies to” the owners of restaurants. It does not apply to the employees of restaurants, even though they are affected by the closure.
Under the HPPA, orders can be issued by a medical officer of health or the courts requiring individuals or classes of persons to take or refrain from taking any action specified in the order. For example, under the communicable disease order provisions in s. 22 of the HPPA, an order can be issued requiring individuals to isolate themselves.
The condition in subclause (ii) of s. 50.1(1.1)(a) will be met if an order made under the HPPA applies to the employee (see the discussion of subclause (i) for the meaning of “applies to” the employee) and there is a causal connection between the order and the employee not performing the duties of the employee’s position.
This subclause is engaged only if the instrument that was made under the HPPA was an “order”. For example, “directives” may also be issued under the HPPA but “directives” do not satisfy this condition. (Note that an employee who is affected by a “directive” under the HPPA may, depending on all the circumstances, be entitled to an infectious disease emergency leave pursuant to s. 50.1(1.1)(b)(iii) or s.50.1(1.2), para. 3. See the discussion of that provision for more information.)
An employee is entitled to declared emergency leave under subclause (iii) of s. 51.1(1.1)(a) if there is a causal connection between the need to provide care or assistance to an individual listed in s. 50.1(8) and the declared emergency.
The employee can be providing the care or assistance in Ontario or in another province, territory, or or country and be eligible for declared emergency leave.
Section 50.1(8) was amended effective March 19, 2020 to include more individuals. However, because the first declared emergency relating to COVID‑19 was made on March 17, 2020, the list of individuals to whom an employee is needed to provide care or assistance in order to be eligible for declared emergency leave is different on March 17 and 18 than it is from March 19 onwards to the end of the declared emergency on July 24, 2020, as follows:
For absences on March 17 or 18, 2020, the employee will meet the condition under subclause (iii) if, because of the declared emergency, the employee is needed to provide care or assistance to any of these individuals:
For absences on or after March 19, 2020, the employee will meet the condition under subclause (iii) if, because of the declared emergency, the employee is needed to provide care or assistance to any of these individuals:
"Spouse" includes married same-sex couples, married opposite-sex couples, and couples of the same or opposite sex who live together in a conjugal relationship outside of marriage – see the definition of spouse and the discussion at ESA Part XIV, s.. 45
With respect to "a person who considers the employee to be like a family member, provided the prescribed conditions, if any, are met" in paragraph 13: at the time of writing there were no prescribed conditions that had to be met.
The declared emergency entitlement is for providing care or assistance. This includes, for example, looking after minor children, providing psychological or emotional support to the family member, assisting the family member with regular household chores (e.g., housekeeping, laundry, shopping) as well as arranging for care by a third party provider, and directly providing or participating in the personal care of the family member. Care or assistance also includes assisting the family member to get their affairs in order, where, for example, the family member is at risk of death.
Note that other leaves of absence in the ESA (infectious disease emergency leave, family medical leave, family caregiver leave, critical illness leave) have eligibility criteria relating to an employee “providing care or support” to specified individuals, while declared emergency leave uses the language “providing care or assistance”. It is Program policy that the same interpretation applies to both phrases. In the context of leave entitlements, where the legislative language is given a broad and liberal interpretation, the types of activities that would fall under a broad view of “support” and a broad view of “assistance” are the same.
Examples of situations where, in the Program’s view, this condition would be met during the COVID‑19 declared emergency include:
Situations where, in the Program’s view, this condition would not be met during the COVID‑19 declared emergency include:
The employee is not eligible for declared emergency leave under this subclause.
The employee satisfies the first condition for declared emergency leave: she is not performing the duties of her position because of the COVID‑19 declared emergency (i.e., to avoid making her brother sick). However, she does not satisfy the second condition under this clause: while self-isolating may be a caring action in this situation, it does not constitute “providing care or assistance”.
On March 19, 2020, the Employment Standards Act, 2000 was amended by the Employment Standards Amendment Act (Infectious Disease Emergencies), 2020 to expand unpaid emergency leave to cover infectious disease emergencies, which the Program refers to as Infectious Disease Emergency Leave. (That Act also repealed the SARS Assistance and Recovery Strategy Act, 2003, which provided leave entitlements relating to SARS.)
Although the amendment that expanded emergency leave to include infectious disease emergencies was effective on March 19, 2020, employees’ entitlements to unpaid infectious disease emergency leave for COVID‑19 for reasons set out in clauses (i)-(vi) of s. 50.1(1.1)(b) are, by virtue of O. Reg. 228/20 (and initially by virtue of O. Reg. 66/20, which was later revoked and replaced by O. Reg. 228/20) retroactive to January 25, 2020.
Entitlement to unpaid infectious disease emergency leave where an employer temporarily reduced or eliminated a non-unionized employee’s hours of work for COVID‑19 related reasons as prescribed in ss. 4(1), para. 1 of O. Reg. 228/20 pursuant to clause (vii) of s. 50.1(1.1)(b) was retroactive to March 1, 2020 and applied during the defined COVID‑19 period in ss. 1(1) of O. Reg. 228/20. When the conditions set out in ss. 4(1), para. 1 of O. Reg. 228/20 were met, the employee was automatically deemed to be on infectious disease emergency leave. The COVID-19 period ended on July 30, 2022.
Entitlement to infectious disease emergency leave was retroactive to July 24, 2020, where an employee was not performing the duties of their position because they were subject to an order related to COVID-19 that:
See the end of this chapter for information on the implications of the retroactive application of this unpaid leave.
Employees have the right to take unpaid job-protected infectious disease emergency leave if they will not be performing the duties of their position because of certain specified reasons related to a designated infectious disease. The diseases that have been designated as infectious diseases are set out in section 2 of O. Reg. 228/20.
At the time of writing, diseases caused by a novel coronavirus, including Severe Acute Respiratory Syndrome (SARS), Middle East Respiratory Syndrome (MERS) and coronavirus (COVID‑19) have been designated as infectious diseases.
O. Reg. 228/20 establishes the start dates for the entitlement to infectious disease emergency leave for the different reasons for which the leave may be taken. At the time of writing, COVID‑19 was the only infectious disease for which there were start dates. Accordingly, the only disease for which unpaid infectious disease emergency leave may be taken at this time is COVID‑19.
Regarding end dates for the entitlement to unpaid infectious disease emergency leave, note that:
Clause (b) of ss. 50.1(1.1) establishes the qualifying criteria that must be met in order for an employee to be entitled to an unpaid infectious disease emergency leave of absence.(See ss. 50.1(1.2) for the qualifying criteria for paid infectious disease emergency leave.)
Employees who will not be performing the duties of their position because of one or more of the following reasons related to a designated infectious disease are entitled to an unpaid infectious disease emergency leave:
These eligibility criteria are discussed individually below.
Employees have the right to be on unpaid infectious disease emergency leave only for as long as the event that triggered the entitlement to the leaves lasts. After the triggering event is over, the employee’s normal obligations to be at work are resumed.
Employees who will not be performing the duties of their position because they are under individual medical investigation, supervision or treatment (including for mental health) related to the designated infectious disease are eligible for unpaid infectious disease emergency leave.
The Act does not impose any restrictions with respect to where the medical investigation, supervision or treatment has to be undertaken in order for this eligibility criterion to be met. The investigation, supervision or treatment can be in Ontario, another province or territory, or another country.
Subsection 50.1(1.0.1), which was introduced into the Act on April 29, 2021, codifies previous Program policy that “treatment related to the designated infectious disease” in subclause “i” includes receiving a vaccine for the designated infectious disease and recovery from side effects of that vaccine. (The Program policy was based on the term “treatment” including preventative treatment, and was consistent with the definition of “treatment” in the Health Care Consent Act.) As such, employees who are not performing the duties of their position because they are getting vaccinated against the designated infectious disease or are experiencing side effects from the vaccine - whether or not the employee is under the care of a medical practitioner with respect to those side effects - are eligible for unpaid infectious disease emergency leave.
Employees who will not be performing the duties of their position because they are acting in accordance with an order under s. 22 or s. 35 of the Health Protection and Promotion Act (HPPA) that relates to the designated infectious disease are eligible for unpaid infectious disease emergency leave. This criterion is met only if the order is, in whole or in part, directed at the employee or a class of persons that the employee fits into.
Section 22 of the HPPA authorizes a medical officer of health to require individuals or classes of persons to take or refrain from taking any action specified in the order in relation to a communicable disease. Orders may include actions such as requiring the person to whom the order is directed to isolate himself or herself, to place himself or herself forthwith under the care and treatment of a physician, or to conduct himself or herself in such a manner as not to expose anyone else to infection.
Section 35 of the HPPA authorizes a judge of the Ontario Court of Justice to issue orders when someone has failed to comply with certain orders that were issued by a medical officer of health in respect of a communicable disease that is a virulent disease. (Note that not all designated infectious diseases are necessarily designated as virulent diseases). Orders issued under s. 35 may, for example, require that someone be taken into custody and admitted and detained in a hospital.
Under this subclause, an employee is eligible for unpaid infectious disease emergency leave if the employee will not be performing the duties of the employee’s position because:
To qualify for this leave under subclause (iii), the employee must not be performing the duties of his or her position because the employee is in quarantine, isolation, or is subject to a control measure ( whether voluntarily or involuntarily).
It is the Program’s position that “in quarantine”, “in isolation”, or “is subject to a control measure” is a step or an action implemented as the result of information or directions related to the designated infectious disease issued to the public, to a part of the public, or to one or more individuals by an entity listed in the provision (see below for more information). Depending on the circumstances, quarantine, isolation or a control measure may be initiated by an employee, initiated by an employer and agreed to by an employee, or imposed on an employee in response to the information or direction.
With respect to “subject to a control measure”: take an example where, in the context of a designated infectious disease outbreak, the Chief Medical Officer of Health issues a public statement or directive providing that employees who come in close contact with an at-risk population while at work should avoid working at other jobs that involve significant contact with the general population, in order to decrease the chances of spreading the disease to the at-risk population. An employee has two jobs - one that requires close contact with an at-risk population and one that involves significant contact with the general population. If the employee stops performing the duties at one of her jobs as a result of the information or direction provided by the Chief Medical Officer of Health, the employee is considered to be subject to a control measure and therefore meets the eligibility criteria under subclause (iii). As such, she would be entitled to take an infectious disease emergency leave from the workplace where she is no longer performing her duties. (This is the case whether it was the employee who decided which workplace to stop performing duties at, or if it happened at the direction of one of the employers.)
AND
The qualified health practitioner can be in Ontario, or in another province, territory or another country. So long as the information or direction provided by the qualified health practitioner is related to the designated infectious disease, this condition will be satisfied if the physician or nurse has provided care or treatment to the employee, whether or not the care or treatment was related to the designated infectious disease. For example, an employee who has an immune deficiency and who was told by his physician to self-isolate and not go to work during the COVID‑19 outbreak is eligible for infectious disease emergency leave.
It is the Program’s position that where information is provided or directions are issued by the Premier of Ontario or the Prime Minister of Canada, this is done in their capacity as representatives of the Government of Ontario and the Government of Canada, respectively.
One question that has arisen is whether direction obtained through the Ontario.ca website COVID‑19 self-assessment tool amounts to directions related to COVID‑19 issued to an individual “by the Government of Ontario”. It is the Program’s position that it does. As such, if an employee completes the assessment questionnaire on the Ontario.ca website with the relevant information specific to the employee’s symptoms and/or risk factors and receives direction that she or he is to self-isolate for a set number of days, then the employee is entitled to take infectious disease emergency leave for the duration of the self-isolation.
Another question that has arisen is whether orders issued under the federal Quarantine Act amount to direction related to COVID‑19 issued to an individual “by the Government of Canada”. It is the Program’s position that it does.
Similarly, it is the Program’s position that orders under the Emergency Management and Civil Protection Act (EMCPA) or the Reopening Ontario (A Flexible Response to COVID‑19) Act, 2020 (ROA) amount to a “direction” issued “by the Government of Ontario”.
For example, an order was issued under the EMCPA (and continued under the ROA when it ceased to be an order under the EMCPA on July 24, 2020) prohibiting employees who perform work in a long-term care home from performing work at more than one long-term care home location, and from performing work both at a long-term care home and in a retirement home or at a long-term care home and for any other health service provider. (A similar order applied to employees who perform work at a retirement home.) An employee who, for example, had two jobs – one at a long-term care home and one at a retirement home – and stoppeds performing the duties at one of the homes as a result of the order was considered to be subject to a control measure implemented as a result of directions related to a designated infectious disease that was issued to the public in whole or in part or to one or more people by the Government of Ontario and therefore met the eligibility criteria under subclause (iii). As such, she would be entitled to take an infectious disease emergency leave from the job where she is no longer performing her duties.
Under this subclause, an employee is eligible for unpaid infectious disease emergency leave if the employee will not be performing the duties of the employee’s position in response to the employer’s concern that the employee may expose others in the workplace to the designated infectious disease. Some examples include:
This subclause does not create authority for employers to direct employees to stay away from the workplace and not perform the duties of their position in response to a concern about exposing others to a designated infectious disease. This subclause is simply providing that if the employer does that, the employee is eligible for an infectious disease emergency leave. The ESA does not address issuesssues about health and safety in the workplace and employers’ authority to exclude employees from the workplace. As such, the question of whether the employers’ actions described in the examples above are appropriate or lawful under other laws is not a matter for the ES Program.
The employee can be providing the care or support in Ontario or in another province, territory country and be eligible for infectious disease emergency leave.
The individuals with respect to whom an employee can take this leave are listed in subsection (8) as follows:
With respect to "a person who considers the employee to be like a family member, provided the prescribed conditions, if any, are met" in paragraph 13: at the time of writing there were no prescribed conditions that had to be met.
The designated infectious disease entitlement is for providing care or support. This includes, for example, looking after minor children, providing psychological or emotional support to the family member, assisting the family member with regular household chores (e.g., housekeeping, laundry, shopping) as well as arranging for care by a third party provider, and directly providing or participating in the personal care of the family member. Care or support also includes assisting the family member to get their affairs in order, where, for example, the family member is at risk of death.
Example of situations where, in the Program’s view, an employee would not be eligible for an infectious disease emergency leave under subclause (v) include:
The employee is not eligible for infectious disease emergency leave under this subclause.
Although the employee would not be performing the duties of her position because of the designated infectious disease (i.e. to avoid making her brother sick), she would not be “providing care or support”. While self-isolating may be a caring action in this situation, it does not constitute “providing care or support”.
For a matter to be related to the designated infectious disease, there must be a causal connection between the “matter” in question and the designated infectious disease.
Closures of schools and day cares that are related to the designated infectious disease are specifically stated in subclause (v) as matters that are related to the designated infectious disease. So for example, an employee who will not be performing the duties of the employee’s position because the employee is providing care to his 5-year old child whose school has been temporarily closed because of the designated infectious disease is eligible for infectious disease emergency leave.
Where daycares or schools have reopened, it is Program policy that an employee who is concerned that the child will come into contact with COVID‑19 at the daycare or school and as a result does not send the child to daycare or school is entitled to infectious disease emergency leave in order to provide care to the child. (This is because the situation falls squarely within the wording of subclause (v): the employee will be providing care to the child, and the reason the care is being provided is because of a matter related to COVID‑19 that concerns the child, i.e. the matter is that the child is not going to daycare or school because of fears of coronavirus exposure.)
Similarly, an employee who is providing care or support to an elderly parent who had been living in a long-term care home but who left the home due to fears of catching COVID‑19 is entitled to infectious disease emergency leave.
It is also Program policy that the cancellation of summer day camps because of COVID‑19 also constitutes a matter related to the designated infectious disease. For example, an employee who will not be performing the duties of his position because he is providing care to his child who otherwise would have been at a day camp for five weeks in the summer that was cancelled because of COVID‑19 is eligible for infectious disease emergency leave for those five weeks.
Other examples of situations where, in the Program’s view, an employee is eligible for infectious disease emergency leave under subclause (v) include:
For example, this would include an employee who is on a cruise ship that is not permitted to dock in any country because of the concern that passengers are infected by a designated infectious disease.
There may be some situations where an employee is affected by travel restrictions (for example where there are no international commercial airline flights available) but the employee has other options available to travel back to Ontario. This condition will be met if it would not be reasonable to expect the employee to use alternative options.
What is reasonable will depend on the circumstances. For example, an employee was vacationing in Mexico City when Canada banned all flights from Mexico for two weeks. The employee could rent a car or take a series of buses and trains to return to Ontario but that would not be a reasonable expectation in the circumstances.
This provision applies only where the employee is directly affected by the travel restrictions. In other words, it applies only where the employee’s travel back to Ontario is affected.
This provision applies only when the employee is caught by travel restrictions while outside of Ontario.
Subsection 4(1) of O. Reg. 228/20 prescribes an additional reason for which non-unionized employees were eligible for infectious disease emergency leave during the “defined COVID-19 period”: the employee’s hours of work were temporarily reduced or temporarily eliminated by the employer for reasons related in whole or in part to the designated infectious disease.
Subsection 4(2) of O. Reg. 228/20 deems employees who are not performing the duties of their position because of the prescribed reason to be on the leave in respect of any time they are not performing their duties for this reason during the “COVID‑19 period”, which is defined in O. Reg. 228/20 to be the period beginning on March 1, 2020 and ending July 30, 2022.
Note that prior to this reason being prescribed, it was Program policy that employees who were not performing the duties of their position because an EMCPA order that was continued under the ROA applied to them were eligible for infectious disease emergency leave based on subclause (iii) of s. 50.1(1.1)(b): these employees were considered to be subject to a control measure on the basis of a direction issued by the Government of Ontario. From the Program’s perspective, the addition of s. 3(1) to O. Reg. 228/20 provides greater certainty that employees in this situation are entitled to infectious disease emergency leave.
See the discussion of the prescribed reasons in the discussion of O. Reg. 228/20.
Subsection 50.1(1.2) was introduced into the ESA by the COVID‑19 Putting Workers First Act, 2021 (CPWFA) on April 29, 2021.
The amendments made by the CPWFA provide employees with an entitlement of up to three paid days of infectious disease emergency leave in certain circumstances related to a designated infectious disease. These entitlements are in addition to the entitlement to unpaid infectious disease emergency leave.
Although the amendments came into force on April 29, 2021, employees’ entitlements to paid infectious disease emergency leave are retroactive to April 19, 2021. Entitlements to paid infectious disease emergency leave end on September 25, 2021 or such later date as may be prescribed. At the time of writing, March 31, 2023 was the prescribed end date (see O. Reg. 228/20, s. 11.)
The CPWFA also amended the ESA to provide that eligible employers are entitled to be reimbursed the amount of infectious disease emergency leave pay that they paid to their employees, up to $200 per employee per day taken. Eligible employers make their application for reimbursement to the Workplace Safety and Insurance Board – see the discussion of s. 50.1.1 for details.
Subsection 50.1(1.2) establishes qualifying criteria that must be met in order for an employee to be entitled to paid infectious disease emergency leave of absence. These criteria are a narrower subset of the reasons that entitle employees to unpaid infectious disease emergency leave. (See ss. 50.1(1.1)(b) for the qualifying criteria for unpaid infectious disease emergency leave.)
Subsection 50.1(1.2) must be read in conjunction with the rest of the section, including new subsections 50.1(1.3) – (1.13). Briefly, those subsections provide:
Employees have the right to be on paid infectious disease emergency leave only for as long as the event that triggered the entitlement to the leave lasts. After the triggering event is over, the employee’s normal obligations to be at work are resumed.
Employees who will not be performing the duties of their position because of one or more of the reasons set out in ss. 50.1(1.2) related to a designated infectious disease are entitled to a paid infectious disease emergency leave. Each reason is dealt with separately below.
1. The employee is under individual medical investigation, supervision or treatment related to the designated infectious disease.
This eligibility criterion for paid infectious disease emergency leave is the same as the eligibility criterion for unpaid infectious disease emergency leave in subclause (i) of s. 50.1(1.1)(b). As such, an employee who meets this eligibility criterion but has no remaining ESA paid infectious disease emergency leave days, or who elects to opt-out of the paid leave in accordance with ss. (1.8), will be entitled to unpaid infectious disease emergency leave.
Employees who will not be performing the duties of their position because they are under individual medical investigation, supervision or treatment (including for mental health) related to the designated infectious disease are eligible for paid infectious disease emergency leave.
The Act does not impose any restrictions with respect to where the medical investigation, supervision or treatment has to be undertaken in order for this eligibility criterion to be met. The investigation, supervision or treatment can be in Ontario, another province or territory, or another country.
Subsection 50.1(1.0.1), which was introduced into the Act on April 29, 2021 at the same time that paid infectious disease emergency leave was introduced, codified previous Program policy in the unpaid infectious disease emergency leave context that “treatment related to the designated infectious disease” in subclause “i” of ss. 50.1(1.1)(b) includes receiving a vaccine for the designated infectious disease and recovery from side effects of that vaccine. (The pre-April 29, 2021 Program policy was based on the term “treatment” including preventative actions, and was consistent with the definition of “treatment” in the Health Care Consent Act.) As such, employees who are not performing the duties of their position because they are getting vaccinated against the designated infectious disease or are experiencing side effects from the vaccine - whether or not the employee is under the care of a medical practitioner with respect to those side effects - are eligible for paid infectious disease emergency leave.
2. The employee is acting in accordance with an order under section 22 or 35 of the Health Protection and Promotion Act that relates to the designated infectious disease
This eligibility criterion for paid infectious disease emergency leave is the same as the eligibility criterion for unpaid infectious disease emergency leave in subclause (ii) of s. 50.1(1.1)(b). As such, an employee who meets this eligibility criterion but has no remaining ESA paid infectious disease emergency leave days, or who elects to opt-out of the paid leave in accordance with ss. (1.8), will be entitled to unpaid infectious disease emergency leave.
Employees who will not be performing the duties of their position because they are acting in accordance with an order under s. 22 or s. 35 of the Health Protection and Promotion Act (HPPA) that relates to the designated infectious disease are eligible for paid infectious disease emergency leave. This criterion is met only if the order is, in whole or in part, directed at the employee or a class of persons that the employee fits into.
Section 22 of the HPPA authorizes a medical officer of health to require individuals or classes of persons to take or refrain from taking any action specified in the order in relation to a communicable disease. Orders may include actions such as requiring the person to whom the order is directed to isolate himself or herself, to place himself or herself forthwith under the care and treatment of a physician, or to conduct himself or herself in such a manner as not to expose anyone else to infection.
Section 35 of the HPPA authorizes a judge of the Ontario Court of Justice to issue orders when someone has failed to comply with certain orders that were issued by a medical officer of health in respect of a communicable disease that is a virulent disease. (Note that not all designated infectious diseases are necessarily designated as virulent diseases). Orders issued under s. 35 may, for example, require that someone be taken into custody and admitted and detained in a hospital.
3. The employee is in quarantine or isolation or is subject to a control measure (which may include, but is not limited to, self-isolation), and the quarantine, isolation or control measure was implemented as a result of information or directions related to the designated infectious disease issued to the public, in whole or in part, or to one or more individuals, by a public health official, a qualified health practitioner, Telehealth Ontario, the Government of Ontario, the Government of Canada, a municipal council or a board of health, whether through print, electronic, broadcast or other means
This eligibility criterion for paid infectious disease emergency leave is the same as the eligibility criterion for unpaid infectious disease emergency leave in subclause (iii) of s. 50.1(1.1)(b). As such, an employee who meets this eligibility criterion but has no remaining ESA paid infectious disease emergency leave days, or who elects to opt-out of the paid leave in accordance with ss. (1.8), will be entitled to unpaid infectious disease emergency leave.
Under this paragraph, an employee is eligible for paid infectious disease emergency leave if the employee will not be performing the duties of the employee’s position because:
To qualify for this leave under paragraph 3, the employee must not be performing the duties of his or her position because the employee is in quarantine, isolation, or is subject to a control measure (whether voluntarily or involuntarily).
It is the Program’s position that “in quarantine”, “in isolation”, or “is subject to a control measure” is a step or an action implemented as the result of information or directions related to the designated infectious disease issued to the public, to a part of the public, or to one or more individuals by an entity listed in the provision (see below for more information). Depending on the circumstances, quarantine, isolation or a control measure may be initiated by an employee, initiated by an employer and agreed to by an employee, or imposed on an employee in response to the information or direction.
With respect to “subject to a control measure”: take an example where, in the context of a designated infectious disease outbreak, the Chief Medical Officer of Health issues a public statement or directive providing that employees who come in close contact with an at-risk population while at work should avoid working at other jobs that involve significant contact with the general population, in order to decrease the chances of spreading the disease to the at-risk population. An employee has two jobs - one that requires close contact with an at-risk population and one that involves significant contact with the general population. If the employee stops performing the duties at one of her jobs as a result of the information or direction provided by the Chief Medical Officer of Health, the employee is considered to be subject to a control measure and therefore meets the eligibility criteria under paragraph 3. As such, she would be entitled to take a paid infectious disease emergency leave from the workplace where she is no longer performing her duties. (This is the case whether it was the employee who decided which workplace to stop performing duties at, or if it happened at the direction of one of the employers.)
AND
a “qualified health practitioner”. This term is defined in s. 50.1(1) and means, “a person who is qualified to practice as a physician or nurse under the laws of the jurisdiction in which care or treatment is provided to the employee or an individual described in subsection (8)”.
The qualified health practitioner can be in Ontario, or in another province, territory or another country.
So long as the information or direction provided by the qualified health practitioner is related to the designated infectious disease, this condition will be satisfied if the physician or nurse has provided care or treatment to the employee, whether or not the care or treatment was related to the designated infectious disease. For example, an employee who has an immune deficiency and who was told by his physician to self-isolate and not go to work during the COVID‑19 outbreak is eligible for paid infectious disease emergency leave.
It is the Program’s position that where information is provided or directions are issued by the Premier of Ontario or the Prime Minister of Canada, this is done in their capacity as representatives of the Government of Ontario and the Government of Canada, respectively.
One question that has arisen is whether direction obtained through the Ontario.ca website COVID‑19 self-assessment tool amounts to directions related to COVID‑19 issued to an individual “by the Government of Ontario”. It is the Program’s position that it does. As such, if an employee completes the assessment questionnaire on the Ontario.ca website with the relevant information specific to the employee’s symptoms and/or risk factors and receives direction that she or he is to self-isolate for a set number of days, then the employee is entitled to paid infectious disease emergency leave (and to unpaid infectious disease emergency leave if the employee runs out of ESA paid infectious disease emergency leave entitlements or has those entitlements but elects to take unpaid leave in accordance with ss. 50.1(1.8)).
Another question that has arisen is whether orders issued under the federal Quarantine Act amount to direction related to COVID‑19 issued to an individual “by the Government of Canada”. It is the Program’s position that it does.
Similarly, it is the Program’s position that orders under the Emergency Management and Civil Protection Act (EMCPA) or the Reopening Ontario (A Flexible Response to COVID‑19) Act, 2020 (ROA) amount to a “direction” issued “by the Government of Ontario”.
For example, a ROA order prohibited employees who performed work in a long-term care home from performing work at more than one long-term care home location, and from performing work both at a long-term care home and in a retirement home or at a long-term care home and for any other health service provider. (A similar order applie d to employees who performed work at a retirement home.) An employee who, for example, had two jobs – one at a long-term care home and one at a retirement home – and stopped performing the duties at one of the homes as a result of the order is considered to be subject to a control measure implemented as a result of directions related to a designated infectious disease that was issued to the public in whole or in part or to one or more people by the Government of Ontario and therefore me t the eligibility criteria under subclause (iii). As such, she would be entitled to paid infectious disease emergency leave from the job where she was no longer performing her duties (and to unpaid infectious disease emergency leave if she ran out of ESA paid infectious disease emergency leave entitlements or had those entitlements but elected to take unpaid leave in accordance with ss. (1.8)).
(Note that O. Reg. 228/20 was amended on August 24, 2020 to explicitly state that, retroactive to July 24, 2020, an employee is entitled to take unpaid infectious disease emergency leave where the employee is not performing the duties of his or her position because the employee is subject to an order that relates to COVID‑19 under the ROA - see s. 3.1 of O. Reg. 228/20. From the Program’s perspective, this amendment provided greater certainty that employees in this situation are entitled to unpaid infectious disease emergency leave, and that even though there is no corresponding provision that applies with respect to paid infectious disease emergency leave, it is the Program’s position that this eligibility criterion for paid infectious disease emergency leave is met where the employee is not performing the duties of his or her position because the employee is subject to an order that relates to COVID‑19 under the ROA .)
It is the Program’s position that where information is provided or directions are issued by the Mayor of a particular municipality in Ontario, this is done in the Mayor’s capacity as a representative of that municipality’s municipal council.
Subclause (iii) provides that the information or direction may be communicated “whether through print, electronic, broadcast or other means”. All methods of communication are captured, including, for example, in-person, telephone, e-mail, the internet, radio, television, newspapers, text message alerts, terminal screens (e.g., at airports, train stations, in subway stations), billboards and signs.
4. The employee is under a direction given by his or her employer in response to a concern of the employer that the employee may expose other individuals in the workplace to the designated infectious disease
This eligibility criterion for paid infectious disease emergency leave is the same as the eligibility criterion for unpaid infectious disease emergency leave in subclause (iv) of s. 50.1(1.1)(b). As such, an employee who meets this eligibility criterion but has no remaining ESA paid infectious disease emergency leave days, or who elects to opt-out of the paid leave in accordance with ss. (1.8), will be entitled to unpaid infectious disease emergency leave.
Under this paragraph, an employee is eligible for paid infectious disease emergency leave if the employee will not be performing the duties of the employee’s position in response to the employer’s concern that the employee may expose others in the workplace to the designated infectious disease. Some examples include:
This paragraph does not create authority for employers to direct employees to stay away from the workplace and not perform the duties of their position in response to a concern about exposing others to a designated infectious disease. This paragraph is simply providing that if the employer does that, the employee is eligible for a paid infectious disease emergency leave. The ESA does not address issues about health and safety in the workplace or employers’ authority to exclude employees from the workplace. As such, the question of whether the employers’ actions described in the examples above are appropriate or lawful under other laws is not a matter for the ES Program.
Note also there is no requirement that the employer’s concern that the employee may expose other individuals in the workplace to the designated infectious disease be well-founded in order for an entitlement to arise under this paragraph. For example, an employee has an allergy that makes the employee’s skin blotchy. Although blotchy skin is not a symptom of a designated infectious disease, the employer is misinformed and is genuinely concerned that the employee may expose others to a designated infectious disease. If the employer therefore directs the employee to stay away from the workplace and not perform the duties of the employee’s position, the employee will be eligible for infectious disease emergency leave.
This eligibility criterion for paid infectious disease emergency leave is a narrower subset of the eligibility criterion regarding providing care or support to certain relatives for unpaid infectious disease emergency leave in subclause (v) of s. 50.1(1.1)(b). As such, an employee who meets this eligibility criterion but has no remaining ESA paid infectious disease emergency leave days, or who elects to opt-out of the paid leave in accordance with ss. (1.8), will be entitled to unpaid infectious disease emergency leave.
Under this paragraph, an employee is eligible for paid infectious disease emergency leave if the employee will not be performing the duties of the employee’s position because the employee is providing care or support to an individual contained in the list in subsection (8) because of the reasons set out in subclause (i) or (ii).
The employee can be providing the care or support in Ontario or in another province, territory country and be eligible for paid infectious disease emergency leave.
The individuals with respect to whom an employee can take this leave are listed in subsection (8) as follows:
"Spouse" includes married same-sex couples, married opposite-sex couples, and couples of the same or opposite sex who live together in a conjugal relationship outside of marriage – see the definition of spouse and the discussion at ESA Part XIV, s.. 45.
With respect to "a person who considers the employee to be like a family member, provided the prescribed conditions, if any, are met" in paragraph 13: at the time of writing there were no prescribed conditions that had to be met.
The designated infectious disease entitlement is for providing care or support. This includes, for example, looking after minor children, providing psychological or emotional support to the family member, assisting the family member with regular household chores (e.g., housekeeping, laundry, shopping) as well as arranging for care by a third party provider, and directly providing or participating in the personal care of the family member. Care or support also includes assisting the family member to get their affairs in order, where, for example, the family member is at risk of death.
An employee is entitled to paid infectious disease emergency leave if the employee is providing care or support to an individual listed in subsection (8) if:
Employees who will not be performing the duties of their position because an individual listed in subsection 51.1(8) is under individual medical investigation, supervision or treatment (including for mental health) related to the designated infectious disease are eligible for paid infectious disease emergency leave.
The Act does not impose any restrictions with respect to where the medical investigation, supervision or treatment has to be undertaken in order for this eligibility criterion to be met. The investigation, supervision or treatment can be in Ontario, another province or territory, or another country.
Subsection 50.1(1.0.1), which was introduced into the Act on April 29, 2021 at the same time that paid infectious disease emergency leave was introduced, codified previous Program policy in the unpaid infectious disease emergency leave context that “treatment related to the designated infectious disease” in subclause “i” includes receiving a vaccine for the designated infectious disease and recovery from side effects of that vaccine. (The Program policy was based on the term “treatment” including preventative actions, and was consistent with the definition of “treatment” in the Health Care Consent Act.) As such, employees who are not performing the duties of their position because they are providing care or support to an individual listed in subsection (8) is getting vaccinated for the designated infectious disease or is experiencing side effects from the vaccine - whether or not the individual is under the care of a medical practitioner with respect to those side effects - are eligible for paid infectious disease emergency leave.
With respect to subclause (ii): this is same as the eligibility criterion under paragraph 3 of this subsection (except under paragraph 3 it is the employee him or herself who is in quarantine, isolation or subject to a control measure and here the employee is providing care or support to an individual listed in subsection (8) who is in quarantine, isolation or is subject to a control measure). See the discussion under paragraph 3 above for information on this eligibility criterion.
This subsection provides that an employee is entitled to take up to three days of paid infectious disease emergency leave.
The Act does not place any restrictions on whether the three days have to be taken consecutively or individually.
Employees can take paid infectious disease emergency leave in entire days or part days (although see ss. 50.1(1.6), which allows employers to deem one day’s leave to be taken when an employee takes part of a day off work for paid infectious disease emergency leave).,
The entitlement to three days of paid leave is subject to ss. 50.1(1.4) and (1.5), which provide that an employee’s entitlement to three days of paid infectious disease emergency leave may be reduced or eliminated in certain circumstances where the employee had an entitlement to paid leave under their employment contract on April 19, 2021. See below for details.
These subsections provide that an employee’s entitlement to three days of paid infectious disease emergency leave as set out in ss. 50.1(1.3) is reduced or eliminated in circumstances where the employee had certain entitlements to paid leave under an employment contract on April 19, 2021.
An employee’s entitlement to three days of paid infectious disease emergency leave is reduced only where all of these criteria are met on April 19, 2021:
Each of these criteria is discussed below.
An employee’s entitlement to three days of paid infectious disease emergency leave can be reduced only if the employee’s contract of employment provides the employee with paid leave for one or more reasons that paid infectious disease emergency leave can be taken. The reasons for which leave can be taken under the contract do not have to exactly match the reasons that paid infectious disease emergency leave can be taken under the ESA for the reduction to apply.
Some examples:
Criterion 1 dealt with the question of the reasons for which an employee has an entitlement to paid leave under their contract and how many days of leave the contract provides.
Criterion 2 deals with the question of the amount of leave entitlements the employee had remaining on April 19, 2021.
An employee’s three-day paid infectious disease emergency leave entitlement is reduced only if the employee had not used up all of the contractual leave entitlements that met Criterion 1 on April 19, 2021 (and only if criteria 3 and 4 are also met).
For example:
Contractual leave entitlements that meet criteria 1 and 2 will only reduce an employee’s three-day paid infectious disease leave entitlement if the employer is required under the contract to pay the employee for the paid contractual leave an amount that is equal to or greater than what the employee would be entitled to under the infectious disease emergency leave pay formula set out in ss. 50.1(1.11) of the ESA. (In very general terms, the formula provides that employees are entitled to the lesser of $200 and the wages the employee would have earned had the employee not taken the leave, excluding overtime pay, a shift premium and premium pay on a public holiday, and with a special rule for employees who receive performance-related wages. See the discussion of ss. 50.1(1.11) for details.)
For example: an employee is entitled under the contract to salary continuance when the employee is away for personal illness. Because this provides an amount that is equal to or greater than what the formula for infectious disease emergency leave pay would provide, this criterion is met.
Because the analysis as to whether this criterion is met is performed with respect to the contractual entitlement on April 19, 2021, any changes to the employees’ contractual entitlements after April 19, 2021 do not factor into the analysis. For example, an employee who earns $200 a day has a contract that provides three days of leave for personal illness with pay of $150 per day. This contractual entitlement does not meet Criterion 3 (it would have to provide $200 per day to satisfy this criterion) so will not reduce the three-day paid infectious disease emergency leave entitlement. This is the case even if the employer makes changes to increase the employee’s contractual pay for leave for personal illness to $200 per day after April 19, 2021. However, see the heading at the end of the discussion of this subsection titled “Whether taking a paid infectious disease emergency leave day draws down the employee’s contractual entitlement”.
In some situations it may not be possible to make a determination in advance of the leave being taken as to whether, on April 19, 2021, the contractual entitlement meets this criterion. For example, the contract provides that an employee who takes a family leave is entitled to 75% of the wages the employee would have earned while on the leave. Whether or not this criterion is met depends on future events that happen after April 19, 2021 – i.e. the length of any leave the employee takes and the employee’s wage rate at the time. In this situation – where there is uncertainty as to whether this criterion is met on April 19, 2021 because it depends on future events - the employer may engage in a two-step analysis: one on April 19, 2021 (this would be the point at which the employer would realize that, in the case of the specific contractual language and the specific employee’s wage rate, that the results of the analysis will vary depending on the length of the employee’s leave) and then a second review after the leave occurs (it would only be at this point at which the employer would be able to assess whether criterion 3 applies). After the second review, any necessary adjustments against the ESA’s 3-day allotment of paid infectious disease emergency leave could be made when it is known whether the contractual pay entitlement is at least as much as the employee would be entitled to receive under the ESA.
For example:
Because ss. 50.1(1.4) says that the reduction can happen only if an employee is “entitled to take paid leave under an employment contract in any of the circumstances for which employees would also be entitled to take a leave under subsection (1.2)”, contractual leave entitlements that meet criteria 1, 2, and 3 will only reduce an employee’s three-day paid infectious disease leave entitlement if the conditions for taking paid contractual leave are no more restrictive than what is set out in the ESA for taking paid infectious disease emergency leave, including that the employee’s employment contract incorporates all of the ESA’s general provisions concerning leaves (as set out in ss. 51-53.1) and the ESA’s anti-reprisal provisions.
Some examples of when there are more restrictive conditions for taking paid leave under the employment contract are:
As with Criterion 3, in some situations it may not be possible to make a determination as to whether, on April 19, 2021, the contractual entitlement meets Criterion 4. For example, a contract provides an employee with ten fully paid days of leave for personal illness per calendar year and the employee had not used any of them as of April 19, 2021. These contractual entitlements meet Criteria 1, 2 and 3. However, the contract requires employees to provide a medical note - which is not permitted in the ESA for paid infectious disease emergency leave - when the employee has three or more consecutive days of absence for personal illness. Whether or not Criterion 4 is met depends on events that happen after April 19, 2021 (the date the determination is made) – i.e. whether the employee takes a contractual leave for personal illness in single days, two consecutive days, or 3 or more consecutive days. In this situation – where there is uncertainty as to whether this criterion is met on April 19, 2021 because it depends on future events- the employer may engage in a two-step analysis: one on April 19, 2021 and the second when the future event happens and make the necessary adjustments to the results of the analysis.
If, on April 19, 2021, the employee’s contractual leave entitlements meet all four criteria (or, where a two-step analysis is done as described under Criteria 3 and 4 that results in the contractual leave entitlements meeting all four criteria), the employee’s three-day entitlement to paid infectious disease emergency leave under the ESA is reduced by the amount of leave available to the employee under the employee’s employment contract that meets all four of these criteria.
Note that the provision establishing the approach to “drawing down” is very different in the context of paid infectious disease emergency leave as compared to the sick leave, family responsibility leave and bereavement leave provisions of the ESA.
In the paid infectious disease emergency leave context, the analysis about contractual entitlements happens on April 19, 2021 – not when the employee is absent. The analysis involves a comparison of the reasons for the leave entitlements that are available to the employee under the contract with the reasons for paid infectious disease emergency leave available under the ESA.
It is important to note that the reasons for leave under the contract and the reasons for leave under the Act do not have to match perfectly in order for the contract to reduce the employee’s three-day ESA entitlement. If a reason for leave under the contract is also one of the reasons the paid leave is available under the Act, the three-day entitlement under the Act is reduced (assuming the contractual leave meets all the other conditions described above). This means that there can be situations where an employee will not have the right to paid leave under either the contract or the ESA when the employee is, after April 19, 2021, away for a reason that the ESA sets out as a qualifying reason for a paid infectious disease leave entitlement. (Although note that in this situation, the employee would have a right to unpaid infectious disease emergency leave under the Act.)
For example, the only paid leave an employee has a contractual entitlement to is to three fully paid “family days”. These days could be used to care for a specified individual who contracted COVID‑19. These are therefore contractual days that could be used for one or more of the reasons for which paid infectious disease emergency leave can be taken. As such, if the employee has three of these days available under his contract on April 19, 2021 and all of the other conditions described above are met, the employee would not be entitled to any days of paid infectious disease emergency leave under the ESA. If the employee wanted paid time off to get tested for COVID‑19 or to get vaccinated against COVID‑19, the employee would not have a right to that paid leave under the contract or under the ESA (though the employee would have an entitlement to take that time as unpaid infectious disease emergency leave).
Here are some additional examples of how the rule about contractual entitlements work in the paid infectious disease emergency leave context:
Example: Denise has a contractual entitlement to ten fully paid sick days each calendar year. These are the only days of paid leave available to her under her contract of employment. There are no conditions attached to the contractual entitlements that are more onerous than those required in the ESA. Denise had a back injury in February and used all ten of her paid sick days.
Denise had no paid leave available to her under her employment contract on April 19, 2021. She is therefore entitled to three days of paid infectious disease emergency leave.
Example 1: Anthony has a contractual entitlement to five fully paid sick days each calendar year. This is the only paid leave available under his contract of employment. There are no conditions attached to the contractual entitlements that are more onerous than those required in the ESA. He took three of the five paid sick days in January 2021. On April 19, 2021, Anthony had two paid days remaining under his contract.
Anthony is therefore entitled to one (3 ESA days minus 2 contractual days remaining) paid infectious disease emergency leave day under the ESA. This is because on April 19, 2021, Anthony had two employer-paid days of leave available under his contract that could be taken for one or more of the reasons for which paid infectious disease emergency leave can be taken and which meet the minimum pay requirements.
Example 2: Quim has a contractual entitlement to five fully paid sick days each calendar year. This is the only paid leave available under his contract of employment. There are no conditions attached to the contractual entitlements that are more onerous than those required in the ESA. Quim took two of the five days in February 2021. On April 19, 2021, Quim had three paid days remaining under the contract.
Quim is therefore entitled to zero (3 ESA days minus 3 contractual days remaining) paid infectious disease emergency leave days under the ESA. This is because on April 19, 2021, Quim had three employer-paid days of leave available under his contract that could be taken for one or more of the reasons for which paid infectious disease emergency leave can be taken and which meet the minimum pay requirements.
Example 3: There is no requirement that the paid leave under the employment contract be for a full workday in order to meet the four criteria. For example, Alexander has a contractual entitlement to four hours of paid leave to receive a COVID‑19 vaccine. This is the only paid leave available under his employment contract. There are no conditions attached to the contractual entitlement that are more onerous than those required in the ESA.
Alexander did not use the leave before April 19, 2021. On April 19, 2021, Alexander had four hours of leave remaining under the contract.
Alexander is therefore entitled to three days less four hours of paid infectious disease emergency leave under the ESA. This is because on April 19, 2021, he had four hours of employer-paid leave available under his contract that could be taken for one or more of the reasons for which paid infectious disease emergency leave can be taken and which meet the minimum pay requirements.
Example: Kristy is hired on May 1, 2021 and has five paid family days under her employment contract. This is the only paid leave available under her contract of employment. There are no conditions attached to the contractual entitlements that are more onerous than those required in the ESA. Given that she did not have any contractual entitlement to paid leave on April 19, 2021 - since she was not employed by the employer at that time - she is entitled to three days of paid infectious disease emergency leave.
Example: Nicholos has a contractual entitlement to five fully paid sick days each year. This is the only paid leave available under his contract of employment. There are no conditions attached to the contractual entitlements that are more onerous than those required in the ESA. These paid sick days are renewed every year on Nicholos’s employment anniversary date, which is May 1st. On April 19, 2021 Nicholos had used up all his paid sick days under his contract of employment. As such, he is entitled to three paid infectious disease emergency leave. This is the case even though his paid contractual sick day bank will be renewed on May 1, 2021.
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It is the employee’s decision as to whether to claim paid infectious disease emergency leave
A question may arise in the situation where an employee has entitlements to both contractual leave and paid infectious disease emergency leave and the employee is absent for a reason that entitles the employee to the leave under both the contract and the ESA. The question is which entitlement - the contractual leave entitlement or the statutory leave entitlement – must be taken first. (This may be relevant for several reasons, including for purposes of tracking the employee’s remaining contractual and statutory entitlements and because employers are eligible to be reimbursed only for payments made for statutory paid infectious disease emergency leave).
The ESA does not dictate which entitlement must be taken first in this situation. As is the case with other statutory leaves, it is the policy of the Employment Standards program that employees decide whether or not to claim a statutory paid infectious disease emergency leave when the employee is absent for a reason that qualifies for that leave.
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Another question that may arise is whether an employee taking a paid infectious disease emergency leave under the ESA affects the employee’s contractual entitlements. In general, whether or not a contractual entitlement is also simultaneously reduced when an employee takes paid infectious disease emergency leave under the ESA is not a matter for the ES Program; it is a contractual matter and will depend on the contractual arrangement. There is, however, one exception that applies in the situation where an employee has entitlements to both contractual leave and statutory paid infectious disease emergency leave and the employee is absent for a reason that entitles the employee to take a leave under both. In that situation, where the employee claims the absence as statutory paid infectious disease emergency leave, it is the policy of the Employment Standards program that the employer cannot simultaneously reduce a contractual leave that met the qualifying conditions in ss. 50.1(1.4) that was used to reduce any of the employee’s three-day entitlement to statutory paid infectious disease emergency leave.
(The reason that the exception applies in this situation is that unlike other leaves of absence under the ESA, an employee’s statutory entitlement to paid infectious disease emergency is dependent on whether the employee has certain contractual entitlements. Because contractual leaves that meet the qualifying conditions in ss. 50.1(1.4) are incorporated into the statutory scheme and are relevant for establishing the employee’s statutory entitlement (i.e. how many days of statutory paid infectious disease emergency leave an employee is entitled to), how they are administered is considered a matter for the Employment Standards program to the extent that the employer cannot reduce the contractual leave when an employee takes a statutory paid infectious disease emergency leave. If a reduction of the contractual leave was permitted in this situation, it would result in an employee who chooses to take, for example, one day of their statutory entitlement before taking their contractual entitlement losing two days of leave entitlement for the absence (i.e. the statutory day and a contractual day).
An employee who chooses to take their statutory entitlement before their contractual entitlement will lose one of their 3 days of leave.
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Employees may not need an entire work day to attend to the event that gave rise to the paid infectious disease emergency leave and might only take part of a day off work. Subsection (1.6) allows an employer in this situation to count a part-day off work as an entire day of paid infectious disease emergency leave for the purpose of counting the absence against the statutory allotment of days. This is the only purpose for which the employer can deem the part day off work as an entire day’s leave. The employer cannot deem the employee not to have worked at all on the day. Where an employee worked a partial day and took a part-day of paid infectious disease emergency leave, the employee is entitled to be paid the earnings for the time that was actually worked that day (in addition to the infectious disease emergency leave pay). As well, the hours that were worked will be counted for the purposes of, among other things, determining whether the relevant overtime threshold has been reached, whether the limits on, for example, the daily and weekly hours of work have been reached, and whether the daily, weekly/bi-weekly and in-between shifts rest requirements have been met.
For clarity, this provision does not require employees to take paid infectious disease emergency leave in full day periods. It simply allows an employer to reduce the employee's statutory paid infectious disease emergency leave entitlement by a day if an employee is on paid infectious disease emergency leave for only part of a day. (Note that pursuant to subsection 50.1 (1.8), an employee may elect to “opt out” of paid infectious disease emergency leave for a particular absence and can instead take the leave as unpaid infectious disease emergency.)
Note that this provision allows the employer to attribute one day's leave to a part day of absence. It does not require the employer to do so.
For example, an employee left work early to get vaccinated against COVID‑19. The employee worked a five-hour day rather than her usual eight hour shift and takes paid infectious disease emergency leave. In that case, the employer may consider the employee to have used up one of her statutory days of infectious disease emergency leave and the employee would be paid infectious disease emergency leave pay for the three hours of leave in accordance with the formula set out in ss. (1.11)-(1.13) plus her earnings for the five hours that she actually worked.
Just because an employer may consider an employee to have used one day of paid infectious disease emergency leave due to a part day of absence does not mean that the employee then has the right to take the entire day off if the triggering event did not last the entire day. For example, an employee's shift is from 9 a.m. to 5 p.m. The employee has an appointment to get a vaccine at 9 a.m. at a location one hour away from the workplace. The employee claims the absence as paid infectious disease emergency leave. The employer is entitled to reduce the employee's paid infectious disease emergency leave entitlement by one day, but if the employee does not experience any immediate side-effects from the vaccine, the employee must return to work after the appointment is over. Employees have the right to be away from work under the infectious disease emergency leave provisions of the ESA 2000 only for as long as the event that triggered the entitlement lasts. After the triggering event is over, the employee's normal obligations to attend at work are resumed.
In addition, employers cannot prohibit employees who took a part day of leave from returning to work for the remainder of their shift. This is because of, among other reasons, the employer's obligation to reinstate the employee at the end of the leave in ESA Part XIV and the prohibition against penalizing employees for having taken a leave in ESA Part XVIII, s. 74.
An issue has arisen as to whether an employer could exercise its discretion and deem a partial day absence as a full day for some employees, but not for others, or whether this might allow employers to selectively punish employees who have too many absences in violation of the reprisal provisions of the ESA 2000.
The answer will depend on the facts. In particular, why did the employer treat the employees differently? Where an employer deems a full day's absence for some employees, but not for others, it is a question of fact as to whether the employer would be in violation of the ESA 2000.
For instance, an employer counts a three-hour paid infectious disease emergency leave as a full day's leave for employee A but not for employee B, who also takes a three-hour leave because the employer considers employee B to be a better worker than employee A. Although this might be unfair as between employee A and B, it would not be a violation of the ESA 2000, as it would not be a reprisal for exercising a right under the ESA 2000.
If, on the other hand, the motivation for the differential treatment was that employee A frequently took ESA leaves such as sick leave, family responsibility leave or paid infectious disease emergency leave of only a few hours, and the employer assigned a full day's absence to these short leaves as a way to ensure employee A used up all of their statutory entitlement as soon as possible because the employer found it inconvenient for the employee to be away for many short periods of time, that would be an unlawful reprisal.
As another example, it would also be an unlawful reprisal if the motive for the differential treatment was because employee A made inquiries about ESA rights or refused to agree to average hours for overtime pay purposes.
Together, these two subsections provide that where an employee who is entitled to paid infectious disease emergency leave takes infectious disease emergency leave between April 29, 2021 and March 31, 2023, that leave is treated as paid infectious disease emergency leave rather than unpaid infectious disease emergency leave. (See ss. (1.9) and (1.10) below for the rule that applies to infectious disease emergency leaves taken between April 19, 2021 and April 28, 2021, inclusive.)
In effect, these provisions provide that the “default” is that the paid infectious disease emergency leave days are used (and the employer is required to pay the employee infectious disease emergency leave pay in accordance with ss. (1.11)-(1.13)) before unpaid infectious disease emergency leave is taken. There is no requirement for an employee to request payment for the first days’ leave; the entitlement to infectious disease emergency leave pay flows automatically from the ESA.
The only exception is where the employee provides the employer with written notice that the employee elects to take the leave as unpaid infectious disease emergency leave. The written notice has to be provided to the employer before the end of the pay period in which the leave was taken in order for the leave to be considered unpaid. (An employee may choose to take unpaid infectious disease emergency leave rather than a paid leave because, for example, receiving paid infectious disease emergency leave may affect an employee’s eligibility for, or amount of, benefits under federal programs.)
An employee does not lose their paid infectious disease emergency leave entitlements if they choose to treat the absence as unpaid infectious disease emergency leave; the entitlements are just deferred to the next infectious disease emergency leave absence.
The COVID‑19 Putting Workers First Act, 2021 received Royal Assent and amended the ESA to introduce paid infectious disease emergency leave on April 29, 2021. However, ss. 50.1(5.2) provides that an employee’s entitlement to paid infectious disease emergency leave is deemed to have started on April 19, 2021.
Subsection 50.1(1.9) provides that employees who took an unpaid infectious disease emergency leave between April 19, 2021 and April 28, 2021, inclusive, for a reason for which paid leave can be taken as per ss. (1.2), can retroactively elect to take those unpaid days as paid infectious disease emergency leave instead (if they have an entitlement to paid infectious disease emergency leave entitlements as per ss. (1.3)).
To make this election, employees must have advised their employer in writing no later than the day before the day that is 14 days after April 29, 2021 – i.e. no later than May 12, 2021.
Subsection 50.1(1.10) provides that where an employee makes an election under ss. 50.1(1.9), the employer shall pay the employee the infectious disease emergency leave pay the employee is entitled to receive no later than the pay day for the pay period in which the employee made the election. This “deadline” for payment overrides the deadline for payment of wages in ss. 11(1) of the ESA, which may have been missed (through no fault of the employer) due to the retroactive nature of the employee’s election.
(1.11) Subject to subsections (1.12) and (1.13), if an employee takes paid leave under subsection (1.2), the employer shall pay the employee the lesser of $200 per day and,
This subsection sets out the manner of calculating the amount of infectious disease emergency leave pay an employer must pay an employee who takes paid infectious disease emergency leave.
Subject to ss 50.1(1.12) and (1.13), the employer must pay the employee the lesser of $200 and either:
At the time of writing, no other manner of calculating infectious disease emergency leave pay has been prescribed.
If an employee takes any part of a day as paid infectious disease emergency leave and the employer deems the employee to have taken one day of leave in accordance with ss 50.1(1.6), the employer is required to pay infectious disease emergency leave pay for the time taken as infectious disease emergency leave (i.e., when the employee is absent) plus any wages the employee earns while working during the day in question.
This provision is read subject to ss 50.1(1.12) and (1.13). Per ss 50.1(1.12), overtime pay and shift premium amounts are not to be included in infectious disease emergency leave pay even if the employee "would have earned" these if the employee worked. Subsection 50.1(1.13) provides that if a day of paid infectious disease emergency leave falls on a public holiday, the employee is not entitled to premium pay for any paid infectious disease emergency leave taken.
Depending on how much leave is taken during a work day, infectious disease emergency leave pay for a work day can be any amount from less than a single hour’s pay to an entire day of wages. But in no case does it exceed $200.
In order to determine how much infectious disease emergency leave pay an employee is entitled to, two things need to be established:
Determining length of employee’s work day on the day leave was taken:
If the employee:
The situation may arise when an employee may be required to report to work at a particular time, but does not have a shift or work period of a specified length. In that case, when assessing the amount of wages an employee would have earned had they not taken paid infectious disease emergency leave in order to determine the amount of infectious disease emergency leave pay owing, the employer must make a reasonable estimate of how long the employee would have worked on that day. For example, it could be reasonable for an employer to take an average of the number of hours worked by all the employees in the same position as the employee who took paid infectious disease emergency leave on the day, or if another employee was called in to replace the employee on the day, it could be reasonable to refer to the length of that employee's shift.
When an employment standards officer is investigating a claim from an employee who believes they received less infectious disease emergency leave pay than the ESA requires (perhaps because the employer took the position that the business was not busy on that particular day and the employer intended to send the employee home early) the officer makes a determination on whether the amount paid by the employer was reasonable. Evidence may include direct evidence from other employees, receipts, point of sale records, customer or production logs, or the staff schedule from the day in question. If the employer has a staff rotation policy and employees are sent home early in a particular order when the business is not busy, was the employee the next person on the list?
Determining how much paid infectious disease emergency leave was taken:
The length of infectious disease emergency leave taken on a single day is calculated by deducting the number of hours actually worked, if any, from the total number of hours in the work day. For example, if it is determined that the employee was scheduled to work nine hours on the day, and they took five hours of paid infectious disease emergency leave to get a COVID‑19 vaccine, they would be entitled five hours of infectious disease emergency leave pay (plus the wages they earned during the four hours at work). If the same employee missed the entire day, they would be entitled to nine hours of infectious disease emergency leave pay.
Here are examples of how the formula in subclause (i) applies in different scenarios:
If the employee is paid by an hourly wage, the amount of infectious disease emergency leave pay is the lesser of $200 and the amount obtained by multiplying the number of hours of infectious disease emergency leave x the hourly rate.
Entitlement:
Entitlement:
Entitlement:
If the employee is paid by salary and has a regular number of days within a pay period and regular hours, the amount of infectious disease emergency leave pay is:
This is, in effect, salary continuance. If an employer pays an employee with a fixed salary the normal amount of pay for a week with a day of full or partial infectious disease emergency leave in it, the infectious disease emergency leave pay provisions of the ESA 2000 will be satisfied.
Example 1:
An employee is paid $1500.00 per bi-weekly pay period and works a five-day week. One day of paid infectious disease emergency leave is taken. Infectious disease emergency leave pay = $1500.00 ÷ 10 = $150.00.
Note: if the employee’s infectious disease emergency leave pay had resulted an amount greater than $200.00, the employee would be entitled to receive $200.00 and not the calculated amount.
Example 2:
An employee is paid $1500.00 per bi-weekly pay period and works a 40 hour week. The employee takes four hours of paid infectious disease emergency leave. Hourly rate: $1500.00 ÷ 80 = $18.75/hour. Infectious disease emergency leave pay: $18.75 x 4 = $75.00. Note that the employee is also entitled to wages earned for the part of the day that the employee worked.
Note: if the employee’s infectious disease emergency leave pay had resulted an amount greater than $200.00, the employee would be entitled to receive $200.00 and not the calculated amount. This $200.00 maximum applies only to the infectious disease emergency leave pay, not to the employee’s total wages for the day.
A situation may arise where the employee receives a "top-up" or subsidy from a third party in addition to an hourly rate of pay or salary. For example, an employee who works in a daycare centre may be paid $16.00/hour plus $2.00/hour as part of a municipal or provincial government initiative to raise wages for workers in the sector. Depending on how the subsidy is structured, it may or may not be considered wages the employee would have earned for the purposes of infectious disease emergency leave pay. If the employee is paid the subsidy directly by an entity other than the employer, then the subsidy may not be considered wages that the employee would have earned because they are not wages being paid by the employer. If, however, the subsidy and the hourly rate are a term of the contract of employment with the employer (oral or written, express or implied), then the subsidy amount must be included in the calculation of infectious disease emergency leave pay.
The amount of infectious disease emergency leave pay for an employee paid fully or partly by a system of wage calculation related to performance is the lesser of $200 and the greater of the employee's hourly rate, if any and the minimum wage that would have applied to the employee.
"Performance-related wages" can include, for example, commission only, commission plus an hourly wage, piece work, or compensation as a flat-rate mechanic.
An "hourly rate" refers to an hourly rate set by an employment contract.
Here are examples of how the formula in subclause (ii) applies in different scenarios:
This subsection excludes overtime pay and shift premiums (for example, an extra amount paid for working evenings or weekends) from inclusion when calculating infectious disease emergency leave pay. As such, an employee would be entitled to be paid for hours of paid infectious disease emergency leave using their regular rate of pay, and not, for example 1.5 times their regular rate per the overtime provisions of the ESA if the leave was taken during a time the employee would have earned overtime pay had the leave not been taken.
Here are some examples illustrating the application of this subsection;
Similarly, if an employee is scheduled to work hours that would normally attract a shift premium, if the employee misses all or some of the shift to take paid infectious disease emergency leave, then infectious disease emergency leave pay will be calculated on the employee's base rate and would not include the shift premium.
Under ESA Part X, Public Holidays, employees who agree to, or are required to, work on a public holiday may be entitled to receive premium pay of at least one and one half times their regular rate for hours worked on that day. The effect of this subsection is that – despite the entitlement in s. 50(1.11) to be paid "the wages the employee would have earned had they not taken the leave" – the employee is not entitled to any premium pay that the employee would have earned by working on the public holiday had the leave not been taken.
Note that in certain situations, per ESA Part X, Public Holidays, the onus is on the employee to prove that the employee had "reasonable cause" for not working all or part of a scheduled shift either on a public holiday, or the "first and last" shifts before or after a public holiday. Also note that it is Program policy that if an employee takes paid infectious disease emergency leave, this will constitute reasonable cause for the purposes of Part X. Note that s. 50.1(4.1) prohibits an employer from requiring that the employee provide a certificate from a qualified health practitioner as evidence of an entitlement to paid infectious disease emergency leave. Therefore, an employer can only require an employee to provide other evidence "reasonable in the circumstances at a time that is reasonable in the circumstances”, per s. 50.1(4.1).
An employee was scheduled to work on a public holiday for ten hours and was going to be paid public holiday pay plus premium pay for the ten hours. The employee worked for six hours and took four hours as paid infectious disease emergency leave. The employee earns the ”general” minimum wage.
Entitlements:
Note that per ss. 50.1(1.13) the employee is not entitled to premium pay for the four hours taken as paid infectious disease emergency leave.
Infectious disease emergency leave pay generally provides that employees do not lose wages for the time they are not working when on paid infectious disease emergency leave, up to a maximum of $200 per day.
In the case of this employee who takes paid infectious disease emergency leave on a public holiday where the employee was scheduled to work and to earn premium pay plus public holiday pay, the employee’s entitlements under the public holiday rules in the Act already provide that the employee earns the amount the employee would have earned (except for premium pay as provided for in ss. 50.1(1.13)) had the employee not taken the leave. As such, in this situation, the employee is not entitled to receive any amount in infectious disease emergency leave pay over and above the employee’s public holiday entitlements.
Note: The public holiday pay and premium pay that the employee is entitled to under the Act’s public holiday rules is not infectious disease emergency leave pay. This is important because it means that the amount the employee is entitled to receive for the public holiday is not subject to the $200 daily infectious disease emergency leave pay maximum. Similarly, an employer is not eligible to be reimbursed this amount through the employer reimbursement scheme (since the amount the employer paid is what the employer owed the employee under the Act’s public holiday rules, regardless of the leave of absence).
An employee does not lose their right to declared emergency leave or infectious disease emergency leave if the employee fails to comply with ss. 50.1(2) or (3). An employee's entitlement to the leave arises where an employee meets the eligibility criteria of the leave. It is the Program’s position that the failure to advise the employer before or as soon as possible after the leave begins does not negate that entitlement. This approach has been affirmed in a grievance arbitration decision by the Ontario Labour Relations Board in the context of the former personal emergency leave, which used identical language to subsections (2) and (4) and which had similarly-structured entitlement provisions to those found in these two leaves – see International Brotherhood of Electrical Workers, Local 115 v The State Group Inc., 2019 CanLII 22129 (ON LRB). In that decision, the Vice-Chair found that notice to the employer is not a prerequisite to exercising the right to the leave. Note that this approach is also consistent with the Program's long-standing policy in the pregnancy and parental leave context, where the structure of the entitlement and notice provisions are also similar to these. See ESA Part XIV, s. 46(4) and s. 48(4).
An issue has arisen as to whether an employer can penalize an employee for failing to give advance notice that the employee will be absent from work (as may be required under an employer policy), where the time off is a declared emergency leave or infectious disease emergency leave under the ESA 2000. Section 50.1(1.1) and (1.2) describes the employee’s eligibility for these leaves. Section 50.1(2) requires the employee taking one of these leaves to advise the employer that the employee is taking the leave, and s. 50.1(3) provides that "if the employee begins the leave before advising the employer, the employee shall advise the employer of the leave as soon as possible after beginning it." It is clear from s. 50.1(3) that the ESA 2000 contemplates situations where the employee would be unable to advise the employer in advance of commencing declared emergency leave or infectious disease emergency leave. Part of the leave entitlement under the ESA 2000 is the right to take the leave even if advance notice cannot be given, with the proviso that the employee must advise the employer of the leave as soon as possible after beginning it. The failure to give notice in advance of taking leave, when it would have been possible for the employee to do so, can be the subject of disciplinary action by the employer without violating section 74. However, the following points should be considered:
Employees who were deemed to be on infectious disease emergency leave during the defined COVID-19 period (March 1, 2020 to July 30, 2022) by virtue of ss. 4(2) of O. Reg. 228/20 were , pursuant to ss. 4(4) of that regulation, exempt from the requirement to provide notice of the leave. See the discussion in O. Reg. 228/20. Note that where an employee qualifies for both paid and unpaid infectious disease emergency leave, the employee does not need to specify in the notice whether they are taking paid or unpaid infectious disease emergency leave. Per ss. (1.7), where an employee who was entitled to paid infectious disease emergency leave took infectious disease emergency leave between April 29, 2021 and March 31, 2023 , that leave is treated as paid infectious disease emergency leave rather than unpaid infectious disease emergency leave. This is subject to ss. 50.1(1.8) that allows the employee to “opt out” of paid infectious disease emergency leave for a particular absence by providing the required written notice to the employer before the end of the pay period in which the leave was taken.
During a declared emergency, an employee may have the right to take declared emergency leave. Employees who will not be performing the duties of their position because of the declared emergency and because of certain specified circumstances related to the declared emergency are entitled to the leave. At the time of writing, there is no declared emergency in effect and so employees are not entitled to take this leave.
Employers can require an employee who takes declared emergency leave to provide proof that the employee is or was entitled to take declared emergency leave. The employer can require an employee to provide evidence that is "reasonable in the circumstances" that the employee is or was entitled to take the leave at a time that is "reasonable in the circumstances."
Depending on the circumstances, such evidence could include:
Employers can require an employee who takes unpaid or paid infectious disease emergency leave to provide proof that the employee is or was entitled to take the leave. The employer can require an employee to provide evidence that is "reasonable in the circumstances" that the employee is or was entitled to take the leave at a time that is "reasonable in the circumstances."
The employer cannot require an employee to provide a certificate from a qualified health practitioner [which is defined in ss. 50.1(1) as a person who is qualified to practise as a physician or nurse under the laws of the jurisdiction in which care or treatment is provided to the employee or an individual described in subsection (8)].
Depending on the circumstances, evidence reasonable in the circumstances could include:
For example, if an employee is in isolation or in quarantine due to the designated infectious disease, it will not be reasonable to require the employee to provide the evidence during the quarantine or isolation period if the employee would have to leave home to obtain the evidence.
However, if the employee has electronic evidence that can be sent from home, it may be reasonable to require the employee to send it during the isolation or quarantine period.
Where an employee takes unpaid and/or paid infectious disease emergency leave to provide care or assistance to an individual listed in subsection (8), the employer cannot require the employee to give details of the relative’s medical condition. The employer is prohibited from requiring the employee to provide a medical note with respect to the relative’s illness. The employer may only require the employee to disclose the name of the relative, the relative’s relationship to the employee, and a statement that the absence was required because of the relative’s illness and that there is a connection between the illness and the designated infectious disease.
Note that the evidence provisions in other ESA leaves do not explicitly state that the “reasonable in the circumstances” standard applies to the timeframe in which evidence may be required (i.e., the provisions in those other leaves only state that employers can require employees to “provide evidence reasonable in the circumstances” – see for example, ss. 50(6), 50.0.1(7) and 50.0.2(7).) Nonetheless, the Program has always considered – and continues to consider – the phrase “reasonable in the circumstances” in those other leaves to apply both to the evidence itself as well as to the timeframe within which it is being required. The explicit inclusion of the phrase “reasonable in the circumstances” with respect to the timeframe in infectious disease emergency leave is to clearly signal to employers that what is reasonable in the context of an infectious disease emergency might differ significantly from what would be a reasonable timeframe within which to require the production of evidence from an employee in other contexts and does not change the interpretation of the evidence provisions in other leaves.
During a declared emergency, an employee may have the right to take declared emergency leave. Employees who will not be performing the duties of their position because of the declared emergency and because of certain specified circumstances related to the declared emergency are entitled to the leave. At the time of writing, there is no declared emergency in effect and so employees are not entitled to take this leave.
Section 50.1(5) means that, subject to ss. (6), an employee is entitled to declared emergency leave only for as long as the employee meets the eligibility conditions (i.e., the employee is not performing the duties of his or her position because of the declared emergency and because of one of the reasons set out in section 50.1(a)). This means, among other things, that once a declared emergency has been terminated or disallowed, subject to s. 50.1(6), the entitlement to declared emergency leave will also end.
Pursuant to ss. (6), the right to take declared emergency leave continues past the end date of the declared emergency if an employee was on declared emergency leave because of an order under section 7.0.2(4) of the EMCPA on July 24, 2020. As such, entitlement to declared emergency leave because of the first COVID‑19 declared emergency ended on July 24, 2020. Note, however, that employees may have had entitlements to other leaves for COVID‑19 related reasons beyond July 24, 2020, unpaid infectious disease emergency leave in particular.
The first declared emergency for COVID‑19, which began March 17, 2020, was terminated on July 24, 2020. Orders under s. 7.0.2(4) of the EMCPA related to COVID‑19 that were made during the first declared emergency for COVID‑19 ceased to be orders under theEMCPA on July 24, 2020.
As such, entitlement to declared emergency leave because of the COVID‑19 declared emergency ended on July 24, 2020. (Note, however, that employees may have entitlements to other leaves for COVID‑19 related reasons beyond July 24, 2020, infectious disease emergency leave in particular.)
The second declared emergency for COVID‑19 began January 12, 2021 and ended on February 9, 2021. Note, however, that employees may have had entitlements to other leaves for COVID‑19 related reasons beyond January 12, 2021, unpaid infectious disease emergency leave in particular.
The third declared emergency for COVID‑19 began on April 7, 2021 and ended on June 2, 2021.
The Act does not specify an upper limit on the number of days an employee may take declared emergency leave. Employees may take the leave in part days, single days, and/or consecutive days or weeks. The Act does not place any restrictions in this regard. Employees may take a leave whenever they meet the eligibility criteria.
According to s. 7.0.7 of the EMCPA, a declared emergency is terminated at the end of the 14th day following its declaration unless it is terminated on an earlier date. The declared emergency may be extended for one period of no more than 14 days by the Lieutenant Governor in Council. Then, it is the Legislative Assembly, on the recommendation of the Premier, which may extend the emergency for additional periods of up to 28 days.
The Legislative Assembly also has the power to disallow the declaration of emergency under s. 7.0.9 of the EMCPA. If the Assembly passes a resolution disallowing the declaration of emergency or the extension of one, any order made under s. 7.0.2(4) is revoked as of the day the resolution passes. Should this occur, an employee’s entitlement, subject to s. 50.1(6), to declared emergency leave would also come to an end.
Generally, and unless an employee is exercising the right to declared emergency leave under s. 50.1(1.1)(iii) (i.e. in order to provide care or assistance to an individual referred to in subsection 50.1(8)), an employee's entitlement to declared emergency will also end where the order under the EMCPA is revoked or the order under the HPPA is no longer in effect, even though an emergency may still be declared.
In other words, unless the employee is needed to provide care or assistance to an individual referred to in subs. 50.1(8), the employee’s right to leave turns on not being able to perform their duties both because there is a declared emergency under s. 7.01 of the EMCPA and because there is an order under the EMCPA or HPPA that applies to the employee. However, s. 50.1(6) deals with the situation where despite the termination or disallowance of the declared emergency, the effective period of an order that had been made under s. 7.0.2 of the EMCPA may be extended. In this situation, an employee’s leave entitlement continues during the period of extension if the employee is not performing the duties of their position because of the order.
Further, s. 141(2.3) of the ESA 2000 allows the Lieutenant Governor in Council to make a regulation to extend the entitlement of an employee to declared emergency leave beyond the day on which the entitlement would otherwise have ended if the employee is still not performing the duties of the employee’s position because of the effects of the emergency and because of a reason referred to in s. 50.1(1.1)(a). This means that the government is able to extend the declared emergency leave entitlement for employees who are, for one of the reasons specified in s. 50.1(1.1)(a), not returning to work because of the prolonged effects of the declared emergency.
Subsection 50.1(5.1) means that employees are entitled unpaid to infectious disease emergency leave as long as they meet the eligibility criteria (i.e., they are not performing the duties of their positions because of one of the reasons set out in s. 50.1(1.1)(b) (i) to (vii), the reason is related to a designated infectious disease per O. Reg. 228/20 (initially O. Reg. 66/20 before that regulation was revoked and replaced on May 29, 2020 by O. Reg. 228/20), and there is a prescribed start date for that designated infectious disease in O. Reg. 228/20 (also initially set out in O. Reg. 66/20).
In other words, the Act does not specify an upper limit on the number of days an employee may take unpaid infectious disease emergency leave.
Employees may take the leave in part days, single days, and/or consecutive days or weeks. The Act does not place any restrictions in this regard. Employees may take a leave whenever they meet the eligibility criteria.
Note: entitlement to the leave for the reason prescribed in s. 4 of O. Reg. 228/20 applies only during the “COVID‑19 period”, which is defined to be the period beginning on March 1, 2020 and ending on July 30, 2021. See the discussion in O. Reg. 228/20.
(5.2) An employee’s entitlement to paid leave under subsection (1.2) is deemed to have started on April 19, 2021 and ends on September 25, 2021 or such later date as may be prescribed.
(5.3) If the regulations so provide, an employee is entitled to paid leave under subsection (1.2) for such additional periods as may be prescribed.
These subsections provide the start and end date to paid infectious disease emergency leave entitlements.
Per these subsections, the entitlement to paid infectious disease emergency leave – which was introduced into the Act on April 29, 2021 - is retroactive and deemed to have started on April 19, 2021. The entitlement ends on September 25, 2021 or such later date as may be prescribed. At the time of writing, March 31, 2023 was the prescribed end date (see O. Reg. 228/212, s. 11.)
Additionally, if a different period is prescribed, paid infectious disease emergency leave would also be available during the prescribed period. At the time of writing no additional periods had been prescribed.
50.1(7) This section applies despite the Protecting a Sustainable Public Sector for Future Generations Act, 2019, and payments made in accordance with subsection (1.11) are not an increase to existing compensation entitlements or new compensation entitlements for the purposes of that Act.
This subsection was introduced into the ESA by the COVID‑19 Putting Workers First Act, 2021 (CPWFA) effective April 29, 2021, at the same time the CPWFA introduced the entitlement to paid infectious disease emergency leave into the ESA.
This subsection provides that the paid infectious disease emergency leave provisions apply despite the Protecting a Sustainable Public Sector for Future Generations Act, 2019 (PSPSFGA) and that payments of infectious disease emergency leave pay are neither an increase to existing compensation entitlements nor new compensation entitlements for purposes of the PSPSFGA.
The PSPSFGA caps public sector compensation increases. The effect of this subsection is that infectious disease emergency leave pay payments are not counted towards the PSPSFGA’s limit on compensation increases.
Section 50.1(8) lists the individuals with respect to whom an employee may take declared emergency leave or infectious disease emergency leave as referred to in subclauses (1.1) (a) (iii),(1.1) (b) (v) and paragraph 5 of (1.2), respectively. See the discussions above for an explanation of the individuals listed in subsection (8). For information on when declared emergency leave was available during the COVID-19 pandemic, please see section 50.1(1.1)(a).
Section 7.2(1) of the EMCPA allows for orders made under s. 7.0.2 of the EMCPA to be made retroactive to a certain date. Section 50.1(10) of the ESA 2000 provides that on or after the date to which the order was made retroactive, those employees who were not performing the duties of their position because of the declared emergency and because of the EMCPA order, are deemed to have been on leave, and they have anti-reprisal protections from discipline or other penalties.
For example, the Lieutenant Governor in Council declares an emergency under s. 7.0.1 of the EMCPA on May 1, 2016. On June 1, 2016 the Lieutenant Governor in Council makes an order under s. 7.0.2 of the EMCPA that applies to an employee and pursuant to s. 7.2(1) of the EMCPA it was made retroactive to May 15, 2016. The employee had not been performing the duties of his position since May 16, 2016. Because the order was made retroactive to May 15, 2016 and an emergency had been declared on May 1, 2016, s. 50.1(10) would apply and the employee would be deemed to have been on a declared emergency leave as of May 16, 2016.
Although Infectious Disease Emergency Leave was introduced into the ESA on March 19, 2020, employees’ entitlements to unpaid infectious disease emergency leave for COVID‑19 for reasons set out in clauses (i)-(vi) of s. 50.1(1.1)(b) are, by virtue of O. Reg. 228/20 (initially O. Reg. 66/20 before it was revoked and replaced by O. Reg. 228/20 on May 29, 2020), retroactive to January 25, 2020.
Entitlement to unpaid infectious disease emergency leave where an employer temporarily reduced or eliminate d a non-unionized employee’s hours of work for COVID-19 related reasons as prescribed pursuant to clause (vii) of s. 50.1(1.1)(b) is retroactive to March 1, 2020 and applies during the defined COVID-19 period , which ended on July 30, 2022. See O. Reg. 288/20 for a discussion of some issues that arise because of the retroactive application of that deemed leave.
This section addresses some issues that arise because of the retroactive application of this leave.
Section 50.1.1 was introduced into the ESA by the COVID-19 Putting Workers First Act, 2021 (CPWFA), effective April 29, 2021, at the same time that the CPWFA introduced a time-limited entitlement to paid infectious disease emergency leave into the ESA (see s. 50.1).
Section 50.1.1 establishes that employers may be reimbursed for certain infectious disease emergency leave pay payments made to employees pursuant to s. 50.1 of the ESA.
Section 50.1.1 provides that an eligible employer is entitled to be reimbursed, through the Workplace Safety and Insurance Board, the amount of infectious disease emergency leave pay paid to their employees, up to $200 per employee per day of paid infectious disease emergency leave taken.
An employer is not entitled to be reimbursed for payments made to an employee for paid infectious disease emergency leave under the Employment Standards Act (ESA) if either:
In other words, an employer cannot cancel their employee’s contractual entitlement to paid leave in order to take advantage of the employer reimbursement.
Reimbursement is only for infectious disease emergency leave pay under the ESA. Employers are not entitled to be reimbursed for vacation pay although employees are entitled to vacation pay for the wages they earn while on the paid leave. Employers are also not entitled to be reimbursed for public holiday pay that may have been paid to employees (see section 50.1 for more information on this).
Eligible employers make their application for reimbursement to the Workplace Safety and Insurance Board (WSIB) within 120 days of the date the employer paid the employee, or by July 29, 2023, whichever is earlier. The reimbursement program is not a WSIB program and is not funded by the WSIB’s insurance fund. Eligible employers do not need to be registered with the WSIB in order to receive this reimbursement. Funding to administer the reimbursement program is provided by the Ministry of Labour, Immigration, Training and Skills Development (MLITSD).
The provisions that establish the system for reimbursement are set out below. Information about the application process, criteria for reimbursement, and other aspects of the reimbursement system are available at the COVID-19 Worker Income Protection Benefit Program website.
Subsection 50.1.1(18) of the Act provides that an overpayment made by the WSIB may be recovered from the employer by the WSIB or by the Ministry of Labour, Immigration, Training and Skills Development in accordance with the prescribed process. O. Reg. 637/21, which was made on September 3, 2021, prescribes the process by which an overpayment may be recovered. The text of the Regulation is set out at the end of this section.
On December 3, 2007, the Employment Standards Act, 2000 was amended by the Fairness for Military Families Act (Employment Standards and Health Insurance), 2007, SO 2007, c 16 to create a new leave entitlement called reservist leave. The reservist leave provisions were amended on April 11, 2022 by the Working for Workers Act, 2022 to add an additional reason for which reservist leave can be taken (to participate in Canadian Forces military skills training) and to shorten the amount of time an employee must be employed in order to be entitled to reservist leave from six consecutive months to three consecutive months.
This standard gives an employee who is a reservist the right to an unpaid leave of absence if the employee will not be performing the duties of his or her position because the employee is deployed to specified Canadian Forces operations or is participating in Canadian Forces military skills training. A "reservist" is defined as a member of the reserve force of the Canadian Forces as referred to in s. 15(3) of the National Defence Act, RSC 1985, c N-5.
To be eligible for reservist leave, the employee has to have been employed by the employer for at least three consecutive months. As of the time of writing, no alternative period has been prescribed.
It is not necessary that the employee be actively working for all or any part of the qualifying period prior to commencing the leave. For example, the employee could be off receiving short-term disability benefits, on a Part XIV leave, on vacation, or on lay-off during the three month qualifying period. As long as there has been no break in the employment relationship within the preceding three month period, the employee is entitled to commence a leave.
Section 50.2(4) provides that an employee's entitlement to reservist leave lasts for the prescribed period or, if no period is prescribed, for as long clause (1)(a), (b) or (b.1) or the circumstances set out in a regulation made under clause 1(c) apply to the employee. At the time of writing, there has been no period prescribed nor have circumstances been set out for the purposes of clause (1)(c) – therefore, the employee will be entitled to be on reservist leave as long as clause 50.2.1(a), (b) or (b.1) applies to the employee (i.e., deployment to a Canadian Forces operation outside Canada – including pre-deployment and post-deployment activities that are required in connection with the operation, deployment to a Canadian Forces operation inside Canada that is dealing with an emergency or its aftermath, or participation in Canadian Forces military skills training).
Section 50.2(5) requires an employee who intends to take reservist leave to give their employer the prescribed period of notice of the day on which the employee will begin the leave or, if no notice period is prescribed, reasonable notice. At the time of writing, there has been no prescribed period of notice, therefore an employee is required to give their employer reasonable notice in advance that the employee intends to take reservist leave. In circumstances where the employee must begin the leave before advising the employer, the employee is required pursuant to s. 50.2(6) to advise the employer as soon as possible after beginning the leave. The employee is required to advise the employer in writing pursuant to s. 50.2(10).
An employee does not lose his or her right to reservist leave if he or she fails to comply with subsection 50.2(5) or (6). An employee's entitlement to reservist leave arises where an employee meets the qualifying conditions in section 50.2(1). It is the Program's position that the failure to advise the employer before or as soon as possible after the leave begins does not negate that entitlement. This approach is consistent in the context of the other statutory leaves, where the structure of the entitlement and notice provisions are similar to these. See for example Employment Standards Act Part XIV, subsection 46(4) and 48(4).
Similarly, the question may arise as to whether an employer can penalize an employee for failing to give advance notice that the employee will be absent from work (as may be required under an employer policy), where the time off is a reservist leave under the ESA 2000. Section 50.2 sets out the conditions for an employee's eligibility for reservist leave. Section 50.2(5) requires the employee taking reservist leave to provide reasonable notice that the employee is taking the leave, and s. 50.2(6) provides that "if the employee must begin the leave before advising the employer, the employee shall advise the employer of the leave as soon as possible after beginning it." It is clear from s. 50.2(6) that the Act contemplates situations where the employee would be unable to advise the employer in advance of commencing the reservist leave - however, it also clear from s. 50.2(5) that an employee who can give reasonable advance notice must do so. Consequently, the failure to give reasonable notice in advance of taking leave, when it would have been possible for the employee to do so, can be the subject of disciplinary action by the employer without violating s. 74. However, the following points should be borne in mind:
In addition, where section 50(2)(6) does apply, an employer would be able to impose discipline if an employee fails to provide written notice of the reservist leave after the leave commences, or if the employee provides notice of the leave so late that one would not reasonably be able to say that it falls within section 50.2(6). However, the employer's disciplinary action would have to be appropriate, and in no way a penalty or reprisal for the employee having taken the leave, but only for the failure to give notice.
Section 50.2(7) gives an employer the ability to require an employee to provide proof that he or she is or was entitled to take reservist leave. Where an employer does require evidence, section 50.2(8) states that the employee shall:
At the time of writing, there has been no prescribed evidence or prescribed time. Therefore, where evidence is required, it must be evidence that is reasonable in the circumstances. Evidence of entitlement to reservist leave may be a document, notice or other kind of confirmation from the Canadian Forces that one of the qualifying conditions set out in section 50.2(1) applies to the employee. The evidence that would be considered "reasonable in the circumstances" will depend upon all of the circumstance in any given situation.
Further, the employee is obliged to provide the evidence at a time that is reasonable in the circumstances. The corollary of this is that timelines imposed by the employer for providing such evidence must be reasonable in the circumstances.
Section 50.2(9) requires an employee who has taken reservist leave and intends to end the leave, to give their employer the prescribed period of notice of the day on which the employee intends to end the leave, or if no notice period is prescribed, reasonable notice. At the time of writing, no period of notice has been prescribed; therefore an employee is required to give their employer reasonable notice in advance of the day on which the employee intends to end the leave. The employee is required to advise the employer in writing pursuant to s. 50.2(10).
Note however that pursuant to section 53(1.1), an employer of an employee who has been on a reservist leave may postpone the employee's reinstatement until:
Consequently, even though an employee has provided notice of his or her intended return date from leave in accordance with section 50.2(9), the employer may postpone the employee's reinstatement under section 53(1.1). As no day has been prescribed under section 53(1.1)(a), the employer may postpone the reinstatement to the later of the day that is two weeks after the day the leave ends or, the first pay day that falls after the day on which the leave ends as per the employee's notice.
Section 50.2(10) requires that notice under section 50.2(5) and (6) (advising the employer regarding start of leave) and section 50.2(9) (advising the employer re: end of leave) must be given in writing. This is in contrast to the requirement to advise the employer in the context of some other leaves (e.g. sick leave, family responsibility leave, bereavement leave) where the notice may be given in writing or orally.
Section 50.2(11) defines what "emergency" means in section 50.2(1)(b) with respect to Canadian Forces operations inside Canada. Example of emergencies that could meet the requirements under section 50.2(1)(b) are Canadian Forces search and rescue operations and operations to provide assistance in dealing with natural disasters or their aftermath.
Section 50.2(12) states that the reservist leave provisions only apply if the deployment described in section 50.2(1) began on or after December 3, 2007, the day the Fairness for Military Families Act (Employment Standards and Health Insurance), 2007 received Royal Assent and further requires that notice of the leave be given on or after that date, in accordance with subsection 50.2(5) or (6).
As a consequence of this provision, an employee was not entitled to reservist leave in respect of a deployment that commenced before December 3, 2007.
This section allows an employee on a Part XIV leave to continue to participate in all the types of plans listed in section 51(2), unless he or she elects in writing not to do so. In other words, unless the employee advises in writing to the contrary, the employer must assume that the employee will continue to participate in the benefit plans, and therefore both the employer and the employee will continue to make their respective contributions.
Special rules apply to reservist leave – see subsection 51(4) and (5) below.
The employee on leave continues to participate in the specified benefit plans, even if all the employees in the employee's department are laid off, go on strike, or are locked out while he or she is on leave, and the benefits of those other employees are cut off. He or she has the right to have the employer pay its share of the contributions during the entire leave – subject to the provisions of section 51(3).
An employee may already be on lay-off, on strike or locked out when he or she commences the leave, and his or her benefits may have been suspended when the lay-off, strike or lock-out began. However, when the employee begins the leave, he or she has the right to begin participation again in the benefit plans and require the employer to pay its share of the contributions during the entire leave – subject to the provisions of section 51(3).
Note: participation in certain benefit plans is fundamentally different from the right to continue to accrue credit for length of service (and seniority and length of employment) during a leave, as provided in section 52. Typically, the right to ongoing participation in a benefit plan is not a function of length service, length of employment or seniority. It is simply an arrangement for the payment or sharing of the payment of a premium. As a result, the rights to continue to participate in these plans are set out separately from the right to accrue service (and seniority and length of employment) while on leave.
However, the right to begin participating in a benefit plan may be tied to length of service or length of employment. It is not unusual, for example, for the terms of a benefit plan to require the employee to have been employed for three months or to have completed three months of service before he or she will be eligible for benefits under the plan. In that case, time spent on leave would count towards the length of service or length of employment required for participation in the plan.
Under section 51(1), an employee who is on a Part XIV leave (with some exceptions that apply to reservist leave – see section 51(4) and (5)) has the right to continue to participate in certain benefit plans. This section lists the plans to which section 51(1) applies:
There are no specific definitions of these plans for the purposes of Part XIV (Leaves of Absence). However, the terms "pension plan" and "life insurance plan" are defined in section 1 of Ontario Regulation 286/01, and it may be helpful to refer to those definitions should an issue arise as to whether a plan is a pension plan or an insurance plan.
Subsection 51(2) itself gives an employee the right to continue to participate only in the types of plans listed in the subsection. If the employer provides other types of plans, it would not be a violation of the subsection for the employer to discontinue the employee's participation in those plans for the length of the leave. The most significant types of plans that are not listed in this section (and that are often provided by employers) are short-term and long-term disability plans. However, section 51(1) should be read in conjunction with section 10 of Ontario Regulation 286/01, which provides as follows:
The effect of section 10 of Ontario Regulation 286/01 is to require short-term and long-term disability benefits to continue to be provided to employees on Part XIV leave (and any longer leave that constitutes a "greater right or benefit" under section 5(2) of the Act) if the employer's plan provides such benefits to employees on leaves other than Part XIV leaves (for example, education leave). (Note that all references to a Part XIV leave in this and the next paragraph include a leave that constitutes "a greater right or benefit".) Only if the plan denies access to disability benefits during non- Part XIV leaves can the employee be denied access to disability benefits while on a Part XIV leave.
Further, even in this latter case (where a plan denies access to disability benefits during non- Part XIV leaves and section 10 of Ontario Regulation 286/01 therefore does not apply), a female employee on a pregnancy or parental leave can access short-term and long-term disability benefits that she would have had access to had she not been on a pregnancy or parental leave during that portion of the leave in which she is unable to work for health reasons related to pregnancy or childbirth. This is because of the Supreme Court of Canada decision in Brooks v Canada Safeway Ltd., [1989] 1 SCR 1219, 1989 CanLII 96 (SCC), in which the Court held that because discrimination on the basis of pregnancy is discrimination on the basis of sex, it is discriminatory to deny women short-term or long-term disability benefits that they otherwise would have been entitled to had they not been on the leave during that portion of a leave in which they are unable to work for health-related reasons related to pregnancy or childbirth, as these constitute a valid-health related reason for an absence from work. As a result, it would constitute discrimination on the basis of sex to deny a female employee disability benefits for that period of the leave. For other court decisions respecting the right to disability benefits for female employees during the "health related" portion of a pregnancy leave, see Alberta Hospital Association v Parcels, 1992 CanLII 6106 (AB QB) and O.S.S.T.F., District 34 versus Barton.
Note that this requirement to permit a female employee on a pregnancy or parental leave access to short-term and long-term disability benefits during that portion of the leave that she is unable to work for health reasons related to pregnancy or childbirth applies only if the employee would otherwise have had access to the plan had she not been on leave. If the employee could not have had access even if she had not gone on leave, there would be no requirement to provide plan benefits. Consider the example of an employer who offers only a modest short-term disability plan (say, three days per year) and no long-term plan who closes its operations from November to March every year. The employer puts all of its employees on temporary lay-off during this time, and discontinues its provision of short-term disability benefits for all employees during the lay-off. If an employee began her pregnancy leave on December 1, it would not be a violation of the Act if she cannot access the disability benefits for the portion of her leave in which she is unable to work for health reasons related to pregnancy and childbirth, because she would not have had access to those benefits even if she had not taken leave.
Pursuant to this provision, an employer will be relieved of the obligation to make the employer portion of contributions to the benefit plans listed in s. 51(2) only if the employer has obtained a written notice from the employee that he or she will not be paying his or her portion of the contributions. (This provision must be read in conjunction with s. 51(4) and (5), which establishes special rules for reservist leave.)
Although, generally, obtaining the written notice that the employee will not make contributions is an administrative problem for the employer rather than a matter of interpretation under the Employment Standards Act, 2000, an officer may have to determine whether such a notice might have been obtained under duress.
An employer may find it helpful to provide employees with sufficient information to enable the employee to make an informed decision to continue paying the contributions to reduce the possibility of a claim that the employee was "tricked" into giving the notice.
Employee A gives the employer written notice that she does not intend to continue paying her share of the contributions, if any, during her pregnancy and parental leave. The employer will not continue its share during the leave and A's coverage will lapse during the leave. The group insurance plan may also require that A, after the end of her leave, undergo a waiting period before becoming re-enrolled in the plan.
Employee B gives the employer written notice that he wishes to pay his share of the contributions to continue coverage during his parental leave (or does not give any notice at all), but B turns out to be unable to pay the contributions during the leave. The employer may pay both the employer and employee share during the leave and then, with B's written authorization, deduct B's share of the contributions from his wages after he returns to work. If the employer does not pay both the employer's and B's shares in this manner, the employer will, in the case of non-pension benefits, pay both the employer's and B's share, but for a pro-rated portion of the leave. For example, if the employer's share is 50 per cent, the employer would pay 100 per cent, but only for half of the leave. There would be no coverage during the second half of the leave and the employee may be required to undergo a waiting period after the end of the leave before becoming re-enrolled in the plan. With pension benefits, the employer would pay its share during the whole leave, and B, to the extent that the plan allowed, would have the right to make up his share after the leave.
If the employer's benefit plan contributions are a percentage of the employee's wages, the employer is still obligated to make contributions during the leave, even though the employee is not receiving any wages from the employer during that time. The amount of the contributions would be determined with reference to the wage rate that the employee received prior to going on leave. If this prior wage rate fluctuated and the employment contract did not stipulate how contributions are to be determined, a reasonable average should be calculated in order to determine the base on which the contributions are computed. Officers may consider it appropriate to calculate the average regular wage over the 12 weeks, a period used in the context of Part XV of the Act (Termination and Severance of Employment), preceding the commencement of the leave. Where a wage increase is given to other employees during the leave and the employee would have received such an increase if he or she had not gone on leave, the employer contributions during the leave in regards to the employee should be adjusted upwards to reflect the increase.
Some employers do not offer benefit plans. Rather, they pay directly to the employee some amount of money instead of making contributions to a plan. These are often known as "percentage in lieu of benefits" arrangements. As such payments are not contributions to a benefit plan, an employer is not required to continue making them during the course of a Part XIV leave.
Annual contributions to group Registered Retirement Savings Plans ("RRSP") are limited to an amount related to wages received. The continuation of contributions to a group RRSP while an employee is on leave and not receiving any wages may result in an over-contribution to the plan. This possible result does not absolve the employer of its obligation to continue contributions throughout the leave. If an over-contribution does result, the recovery rules of the plan or of the Canada Revenue Agency ("CRA") will apply. However, where employees are participating in deferred profit-sharing plans, CRA has the authority to revoke the plan when contributions exceed the maximum allowable. Therefore, Program policy is that employers may cease making contributions to these plans, but only once they reach the maximum amount allowable under CRA rules.
If the employer is a member of a Multi-Employer Benefit Plan, and contributions are not required to be made to the plan in order to continue the employee's coverage during the leave, the employer will still be required to make contributions during the leave, except in cases where the employee is not required to draw on his or her benefit credits, if any, during the leave.
An employee who is on a statutory leave other than reservist leave continues to participate in all types of benefit plans listed in s. 51(2) (e.g., pension plans, life insurance plans, accidental death plans, extended health plans, and dental plans) unless he or she elects not to do so. Pursuant to section 51(4), an employee on reservist leave does not have the right to continue to participate in such benefit plans and the employer is not required to make contributions to the specified plans during an employee's reservist leave. However, if an employer elects to postpone the employee's return date pursuant to s. 53(1.1) (see Employment Standards Act Part XIV section 53 for a discussion), section 51(5) entitles an employee to resume participating in the plans during the postponement period, unless he or she elects not to do so, and correspondingly requires the employer to resume making its contributions to the plans.
The special rules regarding benefit plan participation during reservist leave and the postponement period set out in subsection 51(4) and (5) apply unless otherwise prescribed. At the time of writing, no other rules had been prescribed.
This provision was introduced by the ESA 2000. It addresses the situation where an employment contract places restrictions on the ability to defer taking vacation entitlements, such that a conflict between the right to vacation and the right to take a Part XIV leave is created. Specifically, it applies where an employment contract restricts or forbids the deferral of taking vacation, and, as a result, an employee on a Part XIV leave would have to either take less than their full Part XIV leave entitlement or give up some or all of their vacation or vacation pay entitlement under an employment contract. In this case, the employee has the option of deferring taking the vacation until the leave is over, or to a later date agreed upon in writing by the employer and employee. See Employment Standards Act Part I, section 1(3) and section 1(3.1) for more information on agreements in writing. Section 51.1(2) addresses conflicts between vacation and Part XIV leaves that arise because of the statutory deadline for taking vacation. See subsection (2) below.
For example, an employment contract provides an employee whose period of employment is less than five years with three paid weeks of vacation per year. With respect to the one week that is over and above the ESA 2000's minimum standards, the contract has a "use it or lose it" clause that stipulates the extra week of vacation must be used by December 31 of each year. A recently hired employee is on a combined pregnancy and parental leave from July 1, 2018, to July 1, 2019. She had not taken any of the extra week of vacation before going on leave. Section 51.1(1) provides that the employee has the option of taking that extra week when her leave ends on July 1, 2019, or to a later date if she and the employer agree.
This section should be read in conjunction with s. 51.1(3), which allows an employee to forego vacation time (but not vacation pay), if the employee's employer agrees (in writing) and the Director of Employment Standards approves the agreement. See subsection (3) further below.
This provision addresses the situation where the section 35 or section 35.1 deadline for taking vacation entitlements under the ESA 2000 comes up while an employee is on a Part XIV leave. In this case, the vacation is to be taken immediately upon the expiry of the leave, or, if the employer and employee agree in writing on a later date. See Employment Standards Act Part I, section 1(3) and section 1(3.1) for more information on agreements in writing. Section 51.1(1) addresses conflicts between vacation and Part XIV leaves that arise because of contractual restrictions on deferring vacation entitlements – see subsection (1) above.
For example, an employee is entitled to two weeks of vacation provided for in section 33 (1) of the Employment Standards Act, 2000. The employee started work on January 1, 2016. The deadline for completing the vacation earned from January 1, 2016, to December 31, 2016, is, pursuant to section 35, October 31, 2017. The employee is on a combined pregnancy and parental leave from February 1, 2017, to January 31, 2018 (however, note that a combined pregnancy and parental leave may be longer than 52 weeks, up to a maximum entitlement of 78 weeks). She had not taken any vacation prior to her leave. Section 51.1(2) provides that the two weeks of vacation will be taken immediately after her leave expires, i.e., the two weeks' vacation must start on February 1, 2018. If the employee and employer agree in writing, the employee can take her vacation at a later date.
This section should be read in conjunction with section 51.1(3), which allows an employee to forego vacation time (but not vacation pay), if the employee's employer agrees (in writing) and the Director of Employment Standards approves the agreement. See subsection (3) below.
This provision was introduced by the ESA 2000. It provides that an employee to whom s. 51.1 applies (i.e., an employee on a Part XIV leave whose leave creates a conflict with his or her vacation rights) can, instead of taking his or her vacation at the end of the leave (or at a later date agreed to with the employer) as provided for in s. 51.1(2) and (3), forego the vacation time and receive only the vacation pay. This alternative right can only be exercised in accordance with s. 41 of the ESA 2000, i.e., if the employer agrees in writing to the plan, and the Director of Employment Standards approves the agreement. See Employment Standards Act Part I, section 1(3) and section 1(3.1) for more information on agreements in writing.
Section 52(1) requires employers to give employees on Part XIV leave credit toward length of employment, length of service and seniority for the purpose of determining the employee's rights under an employment contract. This provision should be read in conjunction with the exception contained in section 52(2) of the ESA 2000 regarding completion of probationary periods.
In other words, if rights or other entitlements are earned by way of length of employment, length of service or seniority, these rights or entitlements will continue to accrue during periods of Part XIV leave.
An attempt to exclude periods of Part XIV leave from the calculation of length of service, seniority and length of employment and corresponding entitlements to rights or benefits will be considered null and void, as an attempt to contract out of the Employment Standards Act, 2000. A proration clause will be void if its effect is to remove the period (or portion thereof) of Part XIV leave from the calculation of length of service, seniority or length of employment and by extension, reduce an entitlement that normally accrues through length of service, seniority or length of employment. It may even be considered an attempt to penalize the employee for having exercised the right to leave and thereby constitute a violation of s. 74 of the ESA 2000.
Note, however, that in the context of the requirement that time spent on leave be included when determining the employee's length of service, it is the policy of the Program that employees will earn credit only for length of service, but not for service itself, that is, the employee is not treated as if they had actually been at work during the leave. This reflects a change in past policy. For more details, see the discussion under the heading "Vacation Entitlements" further on in this section.
Section 42(4) of the former Employment Standards Act, which was the predecessor to section 52(1) of the Employment Standards Act, 2000, was amended effective December 1, 1996, by the Employment Standards Improvement Act, 1996, SO 1996, c 23. The earlier version of section 42(4) read as follows:
The amendment codified the Program's original policy position (held between December 1990 and November 1995) regarding the interpretation of the word "seniority" in the pre-1996 version of s. 42(4). During that period, the Program took the view that seniority included the concept of service and, therefore, employees accrued not only seniority but also credit for service during periods of pregnancy and parental leave. However, that interpretation was not supported by adjudicators and referees, and the policy was changed on November 15, 1995. From November 15, 1995, until s. 42(4) was amended by the Employment Standards Improvement Act, 1996 on December 1, 1996, the Program's position was that the word seniority could not be interpreted to include the concept of "service".
On December 1, 1996, the "new" s. 42(4) came into force, specifically requiring employers to credit employees not only for seniority but also for length of service (as well as "length of employment") during periods of pregnancy and parental leave (the only two leaves available under the ESA 2000 at that time).
All employees on leave as of December 1, 1996, began accruing credit for length of service as of that date, even though the leave commenced prior to that date. For example, an employee who was on a leave from August 1, 1996, to February 1, 1997, would not receive any credit for length of service for the period August 1 to November 30, 1996, but would accrue such credit for the period December 1, 1996, to February 1, 1997.
In this example, the employee also accrued credit for seniority and length of employment for the entire period of leave (August 1, 1996 to February 1, 1997).
The phrases in paragraphs 1 and 2 and s. 52(1), "whether or not it is active employment" and "whether or not that service is active" indicate that for purposes of contractual provisions that refer to, say, "length of active employment" or "length of active service", time spent on a Part XIV leave will be counted in determining the employees length of active employment or length of active service, even though the period of an employee's pregnancy or parental leave, for example, might not ordinarily be considered to be a period of active employment or active service. The effect is that the employer cannot prorate entitlements that are dependent upon length of employment or length of service because the employee was not working during the period of leave.
For example, a contract provides that employees who have provided "two years of active service" are eligible for a Christmas bonus. A two-year employee who was away on pregnancy and parental leave for one of those two years will be eligible for the bonus. (Note: it does not matter if the bonus falls within the definition of wages in s. 1 of the ESA 2000 or not. Any entitlement driven by length of service, length of employment or seniority continues to accrue under this section).
However, the contract further provides that the amount of the bonus is to be calculated as a percentage of wages earned during the last two years. Where the amount of the bonus is calculated as a percentage of wages earned, the bonus could be reduced proportionally to reflect the fact that the employee only worked for part of that period.
The Program has always taken the position that statutory leaves had no impact on an employee's length of employment, because a leave did not sever the employment relationship. The employee remained "employed" during the leave, even though they were not actively at work. Entitlements or rights that were earned after the employee had been employed for a specified length of time were therefore unaffected by the fact that an employee had taken a leave. Section 52(1) confirms this policy position and also precludes prorating rights or entitlements by using language in the contract that attempts to distinguish between "active" and "inactive" periods of employment.
Section 52(1) also precludes employers from prorating rights or entitlements that are dependent on the length of an employee's service under a contract of employment. Whereas length of employment is generally understood to mean the length of time elapsed since the date of hire, "length of service" is more likely to mean the period that an employee is providing services to the employer. Where an entitlement under an employment contract is dependent upon length of service, s. 52(1) requires that the time an employee spent on a Part XIV leave be included, even though they were not actually working during the leave period. Contract language that attempts to exclude inactive service from the calculation of length of service will be ineffectual.
Seniority is a term frequently used in collective agreements and will often determine such things as order of lay-off or recall, or confer entitlements to job promotions and increases in annual vacation entitlements.
Under s. 52(1), entitlements that accrue through "seniority" under a contract will continue to accrue during periods of Part XIV leave.
Under Part XI of the Employment Standards Act, 2000, vacation is composed of two separate elements – vacation time and vacation pay.
Vacation time accrues on the basis of completion of a vacation entitlement period. Under s. 33(1), employees whose period of employment on completion of a vacation entitlement year is less than five years are entitled to two weeks of vacation after each vacation entitlement year and employees whose period of employment on completion of a vacation entitlement year is more than five years are entitled to three weeks of vacation after each vacation entitlement year. Under s. 34(2) and (3), employees whose period of employment on completion of a stub period is less than five years are entitled to a pro-rated amount of two weeks of vacation time and employees whose period of employment on completion of a stub period is more than five years are entitled to a pro-rated amount of three weeks of vacation time in respect of the stub period.
Section 33(2) and s. 34(4) provide that inactive as well as active periods of employment be included in the 12-month vacation entitlement year for the purpose of determining an employee's entitlement to vacation time. Consequently, an employee who takes a Part XIV leave during a vacation entitlement year will still have completed 12 months of employment during a vacation entitlement year even if they were not at work for much of that time, as the case may be in the context of a combined pregnancy and parental leave. In addition, the period of time spent on leave will count towards the employee’s period of employment for the purposes of determining the amount of vacation (two or three weeks) to which the employee is entitled.
Vacation pay is calculated under s. 35.2 of the ESA 2000 as a percentage of gross wages excluding vacation pay earned in the period during which the vacation time was earned. Employees who are not earning wages (which will include employees on pregnancy and parental leave under Part XIV) will not have earned any vacation pay during their leave.
Example 1
An employee whose period of employment is more than five years is entitled to three weeks of vacation after each year of employment and vacation pay at 6% of gross wages earned in that year. If the employee was on pregnancy and parental leave for all 52 weeks of the year (), they would be entitled to three weeks' vacation time at the end of the year but her vacation pay, calculated as 6% of the wages earned in the year, would amount to zero.
Example 2
The contract of employment provides a greater right or benefit than the minimum standard for vacation by giving the employee four weeks of vacation after each year of employment and vacation pay at 8% of gross wages earned in that year. This greater right is enforced as per s. 5(2) of the ESA 2000. If the employee was on a Part XIV parental leave for 37 weeks of the year, he would be entitled to the full four weeks of vacation time at the end of the year; however, the vacation pay would be just 8% of the wages earned during the 15 weeks the employee was not on leave (because the employee was not earning wages during the 37 weeks of leave).
As noted earlier, it is now the policy of the Program that employees who are on Part XIV leave will earn credit for length of service; they are not earning credit for the service itself. In other words, the employee is not treated for all purposes as if they had actually been at work providing service throughout the leave, but only for purposes of those rights that depend upon length of employment or length of service. The impact of this policy change may be seen where vacation time is earned through service during the year rather than "length of service" or length of employment (which would be measured from when service or employment first began).
The contract of employment provides that employees whose period of employment is less than five years are entitled to three weeks of vacation for every year of service (i.e. it is driven by service, rather than "length of service") and accrue vacation pay at the rate of six per cent of gross wages. The employee was on parental leave for 37 weeks in a year.
Vacation time
Because the employee is not providing service during the leave, the employment contract would result in vacation time off being calculated as follows: 3 weeks x (15 weeks worked divided by 52 weeks) = .87 weeks of vacation time accrued.
Although, on its face, the vacation time provisions of the contract of employment might appear at first to provide a greater right or benefit than the employment standard set out in s. 33(1)(a) of the ESA 2000, in our example, the contract does not in fact provide a greater right or benefit. Consequently, the employment standard in s. 33(1)(a) should be applied to provide the employee with two weeks of vacation time for the vacation entitlement year.
Previously, under the former Employment Standards Act, it was the policy of the Program that the employee would be entitled to the full three weeks of vacation time in this example, because the policy was that the employee was to be credited for service during the leave for all purposes, i.e., the employer could not pro-rate the employee's entitlement because they had to be treated as if the employee had actually worked through the leave. The Program's position now under the ESA 2000 is that the employee earns credit for length of service, but not for service per se, i.e., the employee is not treated for all purposes as if they had actually been at work during the leave.
Vacation pay
In this example, the employee's vacation pay entitlement under the employment contract is 6% of the wages he earned during the 52 weeks. This would be a greater right or benefit than the employment standard set out in ESA Part XI, s. 35.2, and thus would prevail. As the employee only earned wages for 15 weeks of the year, his vacation pay would be a little less than one week's pay, that is, 6% of the 15 weeks' wages.
Some contracts of employment provide for "paid vacations" earned through service. In these contracts, both vacation time and vacation pay are earned together as a function of service. Once again, the new policy of the Program is that employees who are on leave will earn credit for length of service but they are not earning credit for the service itself. In other words, the employee is not treated for all purposes as if they had been actually at work throughout the leave, but only for purposes of rights that depend upon length of employment or length of service. Where both vacation time and vacation pay are earned through service, the determination must be made as to whether the contractual provisions provide the employee with a greater benefit than the employment standards in ESA Part XI, section 33 (1)(a) or section 33(1)(b), section 34(2) or section 34(3) and section 35.2.
An employee is on pregnancy and parental leave for 39 weeks during a vacation entitlement year. The employment contract states that employees are entitled to 1.5 paid vacation days for each month of active service during the year (18 days per year). Under the contract, the calculation of her vacation time for the year in which they took the leave would be as follows: 3 months (i.e. 52 weeks minus 39 weeks = 13 weeks = 3 months) x 1.5 vacation days = 4.5 paid vacation days.
Vacation time:
Because the employee is not credited with actual service during the leave (only "length of service" as per s. 52(1)), the vacation entitlement under the contract is only 4.5 vacation days. Since this is less than what the ESA 2000 provides, the contract will not prevail over the ESA 2000. Consequently, the employment standard in s. 33(1) should be applied to provide the employee with two weeks or three weeks of vacation time for the vacation entitlement year as determined by her period of employment upon completion of the vacation entitlement year.
Vacation pay:
The 4.5 days of vacation pay would likewise have to be compared to the minimum entitlement under the ESA 2000 to determine whether it was a greater right than the 4% or 6% of wages otherwise earned under s. 35.2. In all likelihood it would be, in which case the contractual entitlement would prevail.
In contrast to the above example, it should be noted that there may be situations where the terms of the employment contract provide a greater right or benefit in that they specifically allow the employee on leave to accrue entitlements during a period of leave, that otherwise accrue through service. For example, in Drake International Inc. v Fernandez, 2005 CanLII 25327 (ON LRB) the issue was whether the employee had accrued paid vacation days during a period of leave. The Ontario Labour Relations Board found that issue did not entail an interpretation of the provisions of the ESA 2000 since the arrangement between the employer and employee exceeded the ESA 2000’s entitlements. The Board noted that the employee's letter of hire provided that paid vacation days accrued through months "worked" and the Employee Guide provided that vacation credits accrued based on "service". However, the Employee Guide went on to say that vacation benefits would continue to accrue during maternity/parental leave. As a result, the Board found that the employee accrued both the vacation time off and the vacation pay during the leave. The employer argued that the Employee Guide was intended to refer only to a right to accrue vacation time and that the company's payroll clerk had credited the employee with vacation pay in error but the Board noted that the employer could not demonstrate an occasion where vacation was accrued "correctly". As a consequence, the Board concluded that the specific terms of the contract allowed the employee to accrue 1.25 paid vacation days for each month they were on leave.
Two issues that have arisen deal with the impact of leaves of absence on attendance management programs and perfect attendance bonuses. Although s. 52(1) does not impact on these matters, questions often arise about them in this context. The impact of leaves of absence on attendance management programs and perfect attendance bonuses are complex issues where it is often difficult to determine what is required under the ESA 2000.
Many employers have programs whereby employees are awarded a bonus for perfect attendance during the year. How should absences due to a Part XIV leave be treated for the purposes of such programs? Where an employer awards a bonus to employees for perfect attendance, on the one hand, an employee taking a Part XIV leave should not be disqualified from the bonus. Such disqualification would likely be found to be a penalty for having taken the leave and, consequently, a violation of s. 74 of the ESA 2000. On the other hand, it would seem absurd to count the time off on the leave of absence as "perfect attendance". Two ways in which an employer could deal with perfect attendance bonuses in such a way as to avoid difficulty with s. 74 of the ESA 2000 are as follows — note that the examples below are based on the assumption that perfect attendance is determined on a calendar year basis:
For instance, if Jane took a combined 52-week pregnancy and parental leave (note that the entitlement to a combined leave is generally longer — up to 78 weeks) from July 1, 2014, to June 30, 2015, and if she would have been eligible for the perfect attendance bonus prior to her going on her pregnancy leave, then she would be awarded a bonus, prorated for 2014. Similarly, if her attendance from June 30, 2015 to the end of 2015 would entitle her to a bonus (had that been her record for the entire year), then she would be awarded a bonus, prorated, for the months she were in attendance during 2015.
All Part XIV leave absences could be treated in a similar fashion. For example, days taken off as sick leave would not disentitle the employee from the bonus, but the amount of the perfect attendance bonus could be a prorated amount to reflect the fewer number of days in attendance. Or, time taken off as family medical leave would not disentitle the employee from the bonus, but the amount of the bonus could be a prorated amount to reflect the fewer number of days in attendance. This approach was cited with approval by the arbitrator in Fleetwood Canada Ltd. v. Union of Needletrades, Industrial and Textile Employees, Local 1381. In that case, the employer provided a weekly attendance bonus only to those employees who maintained perfect attendance during the week. The union argued that employees who took the previous personal emergency leave (then called "emergency leave") should still be allowed to collect the attendance bonus, pro-rated to reflect the number of days they actually worked in a week if they had otherwise had perfect attendance in that week. The arbitrator agreed with the union's approach, taking the position that disqualifying the employees from the bonus because of personal emergency leave absences was a penalty and therefore, a violation of s. 74 of the ESA 2000.
If we take the same example as above, the employer could consider Jane's attendance during the six months in 2014 prior to her leave and extend the year for six months after her return. If during that combined 12-month period Jane met the criteria to receive the bonus, they would receive the full amount of the bonus. Note that where the eligibility period is extended in this way, the next eligibility period will have to commence on the date it would ordinarily have commenced, notwithstanding the extension. In other words, while Jane's bonus for the year 2015 will be based on the two periods July 1, 2015, to December 31, 2015, and January 1, 2016, to June 30, 2016, her bonus for the year 2016 will have to be based on the period January 1, 2016, to December 31, 2016, even though there is some overlap. This is because if the starting date of all subsequent eligibility periods is set back six months, Jane would, over the course of her time with her employer, lose out on a possible six months of bonus eligibility; that would constitute a penalty and would thus be prohibited. Other Part XIV leaves would be treated in the same way. For example, if an employee with otherwise perfect attendance took three days of sick leave during the year, then the year during which his attendance would be considered for the perfect attendance bonus would be extended by three days. If an employee with otherwise perfect attendance took eight weeks of family medical leave during the year, then the year during which her attendance would be considered for the perfect attendance bonus would be extended by eight weeks.
It should be noted that although the approaches set out above do not treat the period of an employee's Part XIV leave as actual service, there is no conflict with the requirement in s. 52(1) that the period of leave be included in calculating the length of an employee's service for the purpose of determining his or her rights under an employment contract. An attendance bonus program does not award a bonus based on length of service, but on actual attendance at work. In the examples considered here, the entitlement to the bonus of a 25-year employee would be the same as the entitlement of a two-year employee. Not including the period of leave as actual service for the purposes of the attendance bonus program would not affect the accrual or calculation of the length of the employee's service, nor of any rights the employee has which are dependent upon the length of service.
The second issue deals with "attendance management programs". Attendance management programs frequently set out a series of steps of escalating seriousness, up to and including dismissal, for employees who miss too many days of work. Each step in these programs is triggered by absenteeism.
For the reasons set out above in the context of perfect attendance bonuses, attendance management programs would not encounter difficulties with s. 52 of the ESA 2000, because s. 52 does not require that Part XIV leave days be considered days of actual service. The more difficult question is how attendance management programs should treat Part XIV leave days to avoid violating the anti-reprisal provisions in s. 74 of the ESA 2000.
The first, and less problematic, option is to not include any absences due to a Part XIV leave towards the threshold to reach the next step in an attendance management program.
Theoretically, an employer could take a different approach, e.g., the employer would count days absent due to a Part XIV leave toward the threshold to reach the next step in an attendance management program. However, extreme care would have to be taken to ensure that the steps in the program are set out in such a way that an employee is not penalized, intimidated, threatened, or disadvantaged for having taken Part XIV leave days under the ESA 2000. While in theory attendance management programs are non-disciplinary, counting time taken, say, for sick leave under the ESA 2000 in assessing whether an employee's absenteeism rate meets the threshold for entering the initial or a subsequent stage of an attendance management program may be found to be a reprisal for exercising the employee's Part XIV right, depending on the structure of the program. For example, an attendance management program may violate s. 74 if it was structured in such a way that a reasonable person in the shoes of the employee would hesitate to take sick leave days under the ESA 2000 for fear of triggering (or coming closer to triggering) the next stage of the program. In order to avoid difficulty with s. 74, the program would require at minimum that the interviews be conducted in a non-threatening, non-intimidating, non-disciplinary manner; and where sick leave is concerned, that the threshold number of absences be higher than the number of sick leave days permitted under the ESA 2000 and justifiable based on the overall average of absences in a particular workplace, the structure of the attendance management program and the particular circumstances of the individual; and that in the final stages of the program where an employee could be dismissed for innocent absenteeism, the threshold should be much higher than the three sick leave days that an employee is entitled to take under the ESA 2000 — a threshold that could result in dismissal if an employee missed only one or two days beyond the sick leave days covered by s. 50 would very likely be seen as penalizing the employee for having taken the sick leave days. In this regard, the arbitrator's decision in Natrel Inc. v Milk and Bread Drivers, Dairy Employees, Caterers and Allied Employees, Local Union No. 674, 2004 CanLII 55036 (ON LA) is relevant, although it was decided in the context of personal emergency leave, which was in force prior to January 1, 2019. In that case, the employer had implemented an attendance management program with the threshold for participation in the program being triggered (at the employer's discretion) by a single absence in excess of a plant average. Personal emergency leave days (then known as "emergency leave" days) were counted as absences for the purposes of the program. One employee was in the program and had been continued in the program for a second three-month period because of a single day of personal emergency leave. The first step of the program was a non-disciplinary interview and a three-month monitoring period with a follow-up letter. Additional absences within the three months could result in a second interview where the employee would be informed of the consequences of additional absences and a requirement that the employee provide a doctor's note for any absences in the next 12 months. If attendance did not improve in the three months following the second interview there would be a third interview and the employee would be required to provide a medical assessment of their fitness to perform their duties. A poor prognosis for regular attendance or where there was continued unsatisfactory attendance could result in termination. The arbitrator concluded that continuing the affected employee in the attendance management program and requiring him to produce a medical certificate for every absence by reason of having exceeded the threshold because of taking a day of personal emergency leave would constitute a reprisal under section 74 of the ESA 2000.
Likewise, an attendance management program that counts pregnancy, parental, family caregiver, family medical, critical illness, crime-related child disappearance, child death, domestic or sexual violence, family responsibility, bereavement, organ donor, or reservist leave absences towards the threshold to enter into the next stage would be problematic in most cases. Employees who take such leave would presumably exceed the threshold number of days to move to the next step in any attendance management program. To bring such employees in for an interview to discuss their attendance, where most or all of their absence was due to being on leave, could very well be seen as a reprisal for having taken the leave.
The first, less problematic, option described earlier (that is, to not consider any absences due to a Part XIV leave as absences that count towards the threshold to the next stage of an attendance management program) would avoid the challenges of structuring attendance management programs in such as way as to avoid violating s. 74 of the ESA 2000, and would also give consistent treatment to all Part XIV leaves.
Section 52(2) provides that, despite s. 52(1) (which provides that time spent on Part XIV leave counts for purposes of length of employment, length of service and seniority), time spent on Part XIV leave will not count towards the completion of probationary periods.
A probationary period typically means a term at the front end of an employee's employment during which his or her suitability as a permanent staff member can be assessed. As well, a period during which an employee is being assessed in a "new" position, where satisfactory completion of the assessment period will result in the "permanent" placement of the employee in that new position, is also considered to be a "probationary period" under s. 52(2). While the beginning of the probationary period in this case does not coincide with the start of employment, it does coincide with the start of a new contract, and for that reason can be considered to be a "probationary period under an employment contract".
It should be noted that periods of leave do not count towards the completion of "disciplinary probationary periods", as such periods do not coincide with the start of employment or an employment contract and so may be seen as being driven by actual service rather than "length of employment, length of service or seniority". Employees do not earn credit for actual "service", as opposed to length of employment, length of service or seniority while on leave.
This provision came into force on October 29, 2014. It establishes a rule relating to leaves that are required to be taken in periods of entire weeks. At the time of writing, only Family Medical Leave must be taken in periods of entire weeks. Accordingly, s. 52.1 only applies to Family Medical Leave. See the discussion of the effect of s. 52.1 on the Family Medical Leave entitlement in Employment Standards Act Part XIV, section 49.1(7).
At the conclusion of an employee's leave under this Part, the employer must reinstate the employee to the position he or she held at the commencement of the leave. In contrast to some of the earlier pregnancy leave provisions, the employee must be reinstated to the position he or she held before the leave if it still exists. In Car Park Management Services Limited v Sze (April 30, 1996), ESC 96-87 (Muir), a decision under the former Employment Standards Act, the employer argued that the employee's position no longer existed because some aspects of the work had been computerized while she was on leave and the employee did not have computer training. See also Imapro Corporation v Fawcett (September 14, 1995) ESC 97-43 (Randall) in which the employer reinstated the employee to a new position because he intended to terminate her with notice contrary to s. 44 of the former Employment Standards Act (corresponding to s. 74 of the Employment Standards Act, 2000). Her previous position required long-term involvement on projects that would have run longer than the notice period. In both of the above decisions, the employer was found to be in violation of the obligation to reinstate under the former Employment Standards Act.
The option of reinstating the employee to a comparable position is available only if the employee's own position is no longer there. In Gorrell, Grenkie, Leroy and Remillard v Vaughan (November 22, 1993), ESC 3296 (Novick), a decision under the former Employment Standards Act, the referee stated that the employer was obliged to reinstate the employee to her own position and that the employee was entitled to refuse an offer of a comparable position (at another office) because her own position still existed. An employer may argue that an employee's position no longer exists because another person (either a reassigned employee or a replacement) is now performing his or her work. This is not a valid reason for not reinstating the employee to the position previously held. If the job is still there, if the same work is being done, the employee has a right to be reinstated to perform the same work, regardless of the fact that another person is now, and has been, performing it.
With respect to the question of "what is the position the employee most recently held", see the following decisions under the former Employment Standards Act: Canadian Holidays Ltd. v Bartol (July 31, 1995), ESC 95-147 (Novick); Woodbridge Inoac Inc. v Frayne (May 2, 1995), ESC 95-86 (Novick); and Martel v 785364 Ontario Inc. o/a Sunny's Restaurant (June 9, 1995), ESC 95-109 (Novick). Also see O.P.S.E.U. Local 458 v Open Hands Inc. (unreported) where the Divisional Court found that the employer violated the former Employment Standards Act when it reinstated an employee to the same job she held before her leave but at a different location.
It should be noted that in determining "what is the position most recently held" that the terms of the employment contract (whether or not it is in writing) are relevant and that the duties and functions being performed (or the location of their performance) prior to the commencement of the leave are not necessarily determinative of the issue.
For example, in a decision under the current Act, the question of "what is the position most recently held" was considered by the Court of Appeal in Elementary Teachers Federation of Ontario v Toronto District School Board, 2005 CanLII 36712 (ON CA). In that case, a board of arbitration had dismissed a grievance arising from the reinstatement of a teacher returning from pregnancy and parental leave. The employee had been teaching Senior French when she went on her leave and was informed that she would be teaching Senior Science when she returned. She declined the assignment. Her collective agreement provided that staffing was to be determined for each year by a process requiring the principal to consider the preferences, abilities, qualifications and experience of the teachers in assigning teaching duties. Her union argued that she should have been reinstated to the French teaching position she held prior to going on leave but the board of arbitration concluded that under the collective agreement the teacher had no right to a particular teaching assignment from year to year or a reasonable expectation to continue teaching the same subject every year. In other words, when the terms of the employment contract (collective agreement) were considered, the employee’s position was not that of "a Senior French teacher" but more broadly that of "a teacher". Despite the fact that she had been teaching French just prior to the commencement of her leave, she did not have a right to reinstatement as a Senior French teacher. The union sought judicial review but the application was dismissed by Divisional Court in Elementary Teachers' Federation of Ontario v Toronto (District) School Board, 2004 CanLII 1652 (ON SC). On appeal of that decision, the Court of Appeal affirmed the Board's decision as reasonable.
In some instances, a pregnant employee during the period prior to her leave is unable to perform her normal job due to the pregnancy. Therefore, the employee is given another job for several weeks before she goes on leave. At the end of her leave, the employee must be reinstated to her original, normal job. The employer’s offer of the other job on a temporary basis was due to the employer’s duty to accommodate under the Human Rights Code, RSO 1990, c H.19.
Section 53 governs the rights of employees after a leave has been taken. There can therefore be no violation of s. 53 before an employee takes a leave. There can, however, be a violation of s. 74 before an employee takes a leave. See the discussion of s. 74 in ESA Part XVIII of the Manual.
Although not directly related to s. 53, (as it is not truly a "reinstatement" issue), one issue that arises frequently is whether an employer is obligated to provide an employee with a part-time position, rather than his or her earlier full-time position, at the employee's request. Clearly, there is no such obligation under the ESA 2000.
Where an employer and employee have reached a pre-leave agreement that the employee will return only on a part-time basis, and the employee changes his or her mind and wants his or her previous position back, Program policy requires that he or she must be given it back. See also Goode v S&E Management Ltd. (October 29, 1996), ES 96-227 (Novick) in which the claimant, before the expiry of her leave, requested that upon her return she be placed in a different position which allowed for better hours, or alternatively, a further four-month leave of absence. The employer was found to be in violation of the former Employment Standards Act by having refused and terminated the employee without allowing her the opportunity to exercise her right to be reinstated to her previous position. The s. 53 protection gives the employee the right to be reinstated to her previous position upon the conclusion of her leave. Any alternate arrangement that does not allow her to exercise that right or that excuses the employer from meeting its obligation to reinstate (such as agreement, prior to the leave, to reinstatement to part-time duties) is seen as a contracting out of the s. 53 employment standard, and hence, by virtue of s. 5(1) of the Act, is null and void.
One issue related to reinstatement to the "same" position concerns the application of the Ontario Human Rights Code provisions that prohibit discrimination on the basis of "family status" and impose a duty of accommodation on the grounds of family status. An employee who seeks such accommodation (for example, an employee may request a change in her shift schedule or a reduction in hours because of difficulties with child care arrangements etc) and who believes he or she has experienced discrimination may be referred to Ontario's Human Rights Legal Support Centre for assistance.
If the employee's position no longer exists, the employer must reinstate the employee to a position comparable to his or her former one. The employer can reinstate the employee to a comparable position only if the employee's former position no longer exists; if the former position still exists, the employer has no choice but to reinstate the employee to it. It should also be noted that there is no positive obligation on the employer to create a comparable position in circumstances where the employee would otherwise have been terminated for reasons completely unrelated to the leave. For example, an employer will be obliged to reinstate to a comparable position where the position most recently held by the employee has been modified to the extent that it could no longer be considered the same position, and the employee would have otherwise moved into the "comparable" position had he or she not been on leave. Another example is where an employee's position has been eliminated, and the employee would have been transferred to the same position at a different location had the employee not been on the leave. See discussion on s. 53(2) below.
In order to meet the obligation to reinstate an employee to a comparable position, it is clearly not sufficient merely to offer a position with the same wages and benefits see C.L.C. (Can Workers' Union, Local 354) v American Can Canada Inc., 1983 CanLII 935 (ON LRB) and Hobbs and Jaciw Investments Limited v Reed (July 11, 1978), ESC 533 (Egan), both cases under the former Employment Standards Act). Rather, one must look at a number of factors, including all the aspects of the new, allegedly comparable job that might make it more or less appealing than the claimant's original job, viewed objectively from the perspective of an employee in a similar position to that of the claimant.
The factors to consider, as originally enunciated by Referee Picher in C.L.C. (Can Workers' Union, Local 354) v American Can Canada Inc. and adopted by the Program are:
The importance and weight to be given to each of the foregoing factors will vary from case to case, depending on the particular facts in each situation. The new position may not be quite as attractive as the old job in all respects, but it will be considered a comparable position if, when the various factors are considered in their totality, the position is qualitatively similar, if not superior, to the job the employee had before he or she went on leave. A test of what is comparable is an objective test, based on what a "reasonable employee" in the same circumstances would think.
For example, the employee in C.L.C. (Can Workers' Union, Local 354) v American Can Canada Inc. had previously held an executive position as Communication Co-ordinator. Upon her return at the end of her leave, she was given work consisting mainly of clerical tasks. Although she incurred no loss in wages, benefits or seniority, her new position involved a marked decrease in the degree of responsibility, prestige and perquisites as well as a loss in job security. In addition, her working environment, originally a private office with access to a personal administrative assistant, deteriorated to a secretarial corner. In light of the foregoing, it was found that the new position was not of a comparable nature and compensation/reinstatement was ordered.
A pre-existing job evaluation system may be relevant but is not determinative of the comparability of the two positions. As the referee stated in Reed Inc. v Nidd (December 23, 1986), ESC 2002 (Mitchnick), another decision under the former Employment Standards Act, the evaluation system may be relevant as an "objective" factor. However, "subjective" factors such as humiliation, embarrassment and loss of prestige must be taken into account as well, but from an objective viewpoint. In other words, for example, would a "reasonable employee" have been humiliated in the same circumstances?
Furthermore, it may not be sufficient merely to offer the same wage where the wage range of the new position is inferior. For example, a new position at $25,000 per year at a $20,000 to $25,000 range may not be considered comparable to the wage of $25,000 at the former position that had a range of $24,000 to $29,000.
To illustrate further, in Bronson Bakery Ltd v Melo and Scott (November 27, 1985), ESC 1992 (Fraser), a decision under the former Employment Standards Act, neither the somewhat lesser degree of responsibility nor the minor variance in hours of work were sufficient of themselves to render the two jobs incomparable. There were, however, significant reductions in prestige and quality of working environment. Having regard to all of these factors, in sum, the referee determined that the employer was in breach of the reinstatement obligations.
It should be noted that despite what appears to be an emphasis in the cases on the employee’s perspective with respect to these factors, the test is objective, that is, how would a reasonable employee in the same circumstances have viewed the situation?
For example, in C.L.C. (Can Workers' Union, Local 354) v American Can Canada Inc., Referee Picher indicated that the employee found the change of geographical location (from Etobicoke to Brampton) significant, but he felt that there was no substantial difference, on that issue alone, and particularly so in light of the fact that the new position may have been even closer to her residence. However, he saw that her concerns on the issue of "location" were in fact more related to "Quality of Working Environment" and the positions were clearly not comparable on that issue. This matter is more directly dealt with in Bronson Bakery Ltd v Melo and Scott where the employee was reinstated to a retail position as opposed to her previous office position. The employer argued that most people would prefer the open environment of the store and dealing with the public and thus submitted that most people would have a different subjective preference from the claimant. However, the referee found that the employee’s viewpoint had a "reasonable objective basis", i.e., that office work was generally seen to have more prestige than retail sales and a higher quality working environment. Accordingly, there should be a "reasonable objective basis" for a subjective viewpoint on the factors considered.
Unlike other types of Part XIV leaves, section 53(1.1) allows the employer of an employee who has been on a reservist leave to postpone the employee’s reinstatement until:
At the time of writing, there has been no prescribed day. As such, an employer may postpone an employee's reinstatement following a reservist leave until the later of two weeks after the day on which the leave ends or the first pay day after the day on which the leave ends. The employer may postpone the reinstatement in accordance with s. 53(1.1) regardless of the length of the employee’s leave.
Therefore, although s. 50.2(9) requires an employee who has taken reservist leave to provide written notice to the employer of the date when he or she intends to end the leave, s. 53(1.1) enables the employer to actually postpone the employee’s reinstatement for two weeks following the date set out in the employee’s notice or the first pay day that falls after that date, whichever is later.
Section 53(1.2) states that during a period of postponement, the employee is deemed to continue to be on a reservist leave for the purposes of s. 51.1 (leave and vacation conflict) and s. 52 (length of employment).
Note that pursuant to s. 51(4), an employer is not required to continue the employee's participation in the types of benefit plans listed in s. 51(2) (if applicable) during a period of reservist leave. However, should the employer decide to postpone an employee’s reinstatement date as permitted by s. 53(1.1), s. 51(5) provides that the employee is entitled to continue to participate in benefit plans pursuant to ss. 51(1) and (2) and the employer is required to make contributions to such plans as required under s. 51(3), during the postponement period.
The right of reinstatement under s. 53 is not absolute. The reinstatement provisions are meant to ensure that an employee who goes on Part XIV leave is in the same position she or he would have been in if she or he had not gone on leave. The provisions are not meant to give a greater right to employees on leave. Where the employer has reasons to terminate an employee’s employment that are completely unrelated to the fact that the employee went on a Part XIV leave, reinstatement will not be required. The employer has the onus of proving that the termination was totally unrelated to the fact that the employee took the leave.
The same principle applies with respect to economic downturns or other reasons that lead to layoffs. If at the end of a leave, the position the employee most recently held still exists but is inactive (for example, because the business is not operating or is operating at lower than usual capacity and does not currently have any work for that position), there is no violation of s. 53 where the employer reinstates the employee into his or her most recently held position and then immediately places the employee on a temporary layoff (so long as the layoff does not constitute a reprisal, e.g. if any part of the reason for the layoff was because the employee took the leave). For practical purposes, in the situation where the position is inactive at the time the employee’s leave is over, the employer only notionally reinstates the employee; the employee does not need to physically return to the workplace for a shift nor does the employee need to complete any amount of work before being told that he or she is laid off.
As an example, this situation may have arisen at the end of the “COVID-19 period” when an employer who was still experiencing economic losses was required to reinstate an employee who had been deemed to be on unpaid infectious disease emergency leave per O. Reg. 228/20. For a discussion about employee reinstatement from the “deemed leave” see s. 4 of O. Reg. 228.
While s. 53(2) was introduced in the ESA 2000, it was intended merely to codify Program policy that existed under the former Employment Standards Act. While the cases cited in this section were all decided under the former Employment Standards Act, 2000, the principles enunciated in these cases are equally applicable to the ESA 2000.
In determining whether the termination is in contravention of s. 53, the test is, "Would this employee have lost his or her job if he or she had never gone on Part XIV leave?"
This test was used in C.L.C. (Can Workers' Union, Local 354) v American Can Canada Inc.where the referee noted that absent her leave, the employee would still be in her former function. The referee referred to her pregnancy as a "catalyst" for the decision to change the employee's position. See also Wyeth-Ayerst Canada Inc. v Dowd (January 7, 1998), 2466-96-ES (ON LRB), where a bona fide restructuring was held not to prove the employer's case because the evidence disclosed the employee's leave had been a factor in the decision to terminate her. See also Jackson v Elizabeth Arden Salons of Canada Limited (October 20, 1995), ESC 95-175 (Bradbury).
An employer cannot refuse to reinstate an employee where it was discovered during the leave that the employee was in fact dispensable, as it would be the occasion of the leave that gave rise to the reason for the termination (reasoning used in C.L.C. (Can Workers' Union, Local 354) v American Can Canada Inc.). This situation is often encountered where the employer determines during an employee's leave that the operation runs more smoothly without him or her or the temporary replacement performs more satisfactorily. A termination under these circumstances will be a violation, since the purpose of Part XIV of the Act is to ensure that the employee does not "lose out" in the workplace by reason of a Part XIV leave.
The fact that reinstatement at the termination of the leave is at an inconvenient or difficult point in the employer's cycle of operations (e.g., in the final few weeks of a teaching term for a teacher) is not a legitimate basis for non-reinstatement. Clearly, had the employee not gone on a leave, under normal circumstances, he or she would have continued to have been employed.
Again, the exception in s. 53(2) applies only where the reasons for not reinstating were entirely unrelated to the leave.
However, if the reason for the failure to reinstate would have resulted in a termination even if the employee had not gone on leave, there is no violation under s. 53(1). For instance, where the employer undergoes a downsizing or restructuring of its business, there would be no obligation to reinstate if the employee would have lost his or her job regardless of whether he or she had gone on leave. See Littlewood v Birchcliff Heights Child Care Centre (March 27, 1997), 2882-96-ES (Misra), Rahman v York Condominium Corporation 506, 1999 CanLII 19489 (ON LRB), and Singh v George Kent Home Improvements Limited (January 18, 1996), ESC 96-09 (Muir). See also Nygard International Ltd. v Thornton (October 12, 1994), ESC 93-154A (Muir), where an employee is guilty of misconduct that would justify her dismissal, she need not be reinstated.
It should be noted however that even where there is no obligation to reinstate, there may in some situations be an issue of reprisal under s. 74. For example, if it is demonstrated that but for being on the leave, the employee would have been given a choice between accepting termination or being offered another position with the same employer, albeit one that is not comparable with the original position, the employee may be found to have been "penalized" because she had exercised a right to leave - despite not having a right to be reinstated to her job or to a comparable position.
When an employee is hired on a fixed-term contract and the term expires during her leave, the employment relationship generally comes to its natural conclusion with the expiry of the term. In such cases, the reasons for not reinstating are entirely unrelated to the leave and so the employer has no obligation to reinstate under s. 53(1). The employee's employment simply ends when the contract expires. (However, if the evidence showed that the employer chose not to consider the employee for a contract renewal because she was on a leave, that decision not to renew could nevertheless constitute a reprisal under s. 74.)
Where legitimate grounds do exist, the employer may terminate an employee during his or her leave in compliance with Part XV of the Act; the employer need not reinstate and then dismiss the employee. Under the former Employment Standards Act, there were two conflicting lines of authority as to whether the employer is required to pay wages to employees who are entitled to notice of termination, if they are on leave of absence (or otherwise not available to work the notice period for reasons personal to themselves). One line of authority has interpreted the termination provisions in the former Employment Standards Act and regulations as in most instances requiring the employer to pay wages to employees who are entitled to notice of termination but who do not make themselves available to work the notice period for reasons personal to themselves. See MacMillan Bathurst Inc. v Fox (June 13, 1985), ESC 1893 (Egan), Maple Leaf Foods Inc. v Alejandro, 1999 CanLII 2908 (ON CA) and Horizon Poultry Products Inc. v Roth (February 2, 1995), ESC 95-53 (Randall). The second line of cases took the view that employees not making themselves available for work during the notice period ought not be entitled to wages during the notice period. See St. Joseph's Health Centre of London v Vanderwerf (February 10, 1992), ESC 2982 (Novick) and Pioneer Youth Services (Toronto) Inc. v Fitzpatrick, 2000 CanLII 4665 (ON LRB). Although both viewpoints have received some support from the courts on judicial review, it is the Program's position that the better interpretation of the termination provisions is found in the MacMillan Bathurst Inc. v Fox and Maple Leaf Foods Inc. v Alejandro line of cases.
Section 60(1)(b) of the Act provides that the employer shall pay to the employee the wages to which the employee is entitled to receive during the period of notice, "which in no case shall be less than his or her regular wages for a regular work week." Further, s. 61 of the Act provides that an employer may terminate the employment of an employee without notice, but only if it pays termination pay equal to the amount the employee would have been entitled to receive under s. 60 had notice been given, which, as summarized above, provides that the amount will in no case be less than the regular wages for a regular work week.
The purpose underlying the notice of termination provisions is to give employees some breathing room during the notice period (or with the pay in lieu of notice) to reorder their affairs. To interpret the termination provisions in a way that would place employees who are on a leave in a worse position than they would have been in had they not taken the leave would be contrary to the intention of the Act. Consequently, it is Program policy that unless the employee is otherwise disentitled to termination pay (i.e., by virtue of s. 2(1) of O Reg 288/01), the employer must pay the required wages even if the employee is on leave. The above interpretation follows the reasoning upheld by the Court of Appeal in Maple Leaf Foods Inc. v Alejandro and by the Divisional Court in MacMillan Bathurst Inc. v Fox. Although those cases (which were decided under the former Employment Standards Act) dealt with workers' compensation and sick leave, respectively, the principles are relevant to Part XIV leave. See ESA Part XV ("Termination and Severance of Employment") for a discussion of this issue. See Horizon Poultry Products Inc. v Roth for a decision under the former Employment Standards Act concerning an employee dismissed while on pregnancy/parental leave. Note that Pioneer Youth Services (Toronto) Inc. v Fitzpatrick, also a decision under the former Employment Standards Act, followed the opposing line of cases to find that where an employee is terminated for reasons unrelated to her pregnancy or pregnancy leave and the period of notice that is given coincides with her pregnancy leave, she is not entitled to be paid during the notice period. This decision is contrary to Program policy.
Where legitimate grounds to terminate the employment relationship exist and severance pay is owing, it is Program policy that the "regular work week" that is used to determine the amount of severance pay owing is the employee’s "regular work week" that he or she had before the leave began.
Although s. 53(1) requires reinstatement of the employee, it does not address firings post-reinstatement. Protection in this regard is offered by the Program’s position that a "sham reinstatement" will be considered to be no reinstatement at all, and thus a violation of s. 53(1). The right to a Part XIV leave and reinstatement thereafter would be a farce if the employer could get away with firing the employee immediately following a token reinstatement. In Cole v Coates (June 30, 1982), ESC 1241 (Bigelow), although no clear reasons were given by the referee, an employee who was terminated one week after reinstatement was compensated for the violation of her rights under the reinstatement provisions. Clearly, the longer the employee is back at work, the more difficult it is to identify a "sham reinstatement".
Further protection against post-reinstatement firings is provided by s. 74 of the Act, which prohibits employers from dismissing or otherwise penalizing an employee because he or she, among other things, takes a Part XIV leave.
Section 53(3) sets out the wage rate that an employee reinstated under s. 53(1) is entitled to receive. This rate is the higher of the rate he or she earned before the leave began, and the wage rate the employee would be earning had he or she continued to work and not gone on leave. The latter provision would apply, for example, if the employee would have advanced to a higher grade in the pay scale for his or her position because he or she had been employed for the requisite amount of time. (For example, if there is a grid that provides that an employee's wage rate increases by $0.50 per hour after each of the first five years of employment, and an employee who had been earning $25.00 commences a combined pregnancy and parental leave of one year at the point at which she had been employed for two and one-half years, she would be entitled to a rate of $25.50 when she resumed working at the conclusion of her leave. It would also apply if a union negotiates a pay raise for employees in the bargaining unit it represents. (For example, if the employer grants an across-the-board increase of $1.20 an hour for all office employees that took effect while an employee who works in the office was on leave, that employee would be entitled to earn the increased rate when he or she returned from leave.)
The purpose behind this provision is to prevent an employer from denying a reinstated employee wage increases that, from an objective standpoint, would inevitably have been given to him or her during the time that he or she was on leave had he or she instead continued working. It was not intended to give an employee a right to a wage increase where it is entirely speculative as to whether he or she would have received the increase had he or she continued working.
For example, an employee's contract of employment might provide for a performance review every year in the month following the anniversary of his or her date of hire, with the result of that review determining whether he or she would receive a merit increase. If an employee was hired on June 15, 2010, received favourable performance reviews and, in consequence, merit increases in July of 2011 and 2012, and then went on leave from September 15, 2012, to September 14, 2013, subsection 53(3) does not entitle her to a merit increase immediately upon her return to work on September 15, 2013, even though in the ordinary course she would have had a performance review in July of 2013 that probably would have resulted in a merit increase (based on what happened after her performance reviews in earlier years). This is because the merit increases were not automatic; whether she would have received a merit increase had her performance been reviewed in July of 2013 is conjectural.
Although in the above example there is no entitlement to a merit increase upon the employee's return to work, the employer would be required to schedule a performance review (and provide a merit increase if the results of that review so indicated) in such a way that the employee was not penalized for having exercised her right to take leave; otherwise, there would be a violation of s. 74 of the Act. There are two ways in which the employer can do this and avoid such a violation. The first would be to provide the employee with a review once her post-leave service, when added to any pre-leave service that had not been the subject of a review, equalled the period that would entitle her to a review. Thus, using the example from the preceding paragraph, where the employee is entitled to a review after each 12 months of service and had accumulated three months of service credits towards the 12 months before going on leave, the employer would have to give her a performance review following the completion of a further nine months of service following her return. The further nine months would be completed on May 15, 2014, and so the review would take place in June of 2014; subsequent reviews would take place in June of each year, rather than in July. Alternatively, the employer could give the employee a performance review after the employee returned to work, using what would have been the usual review period of June 15, 2012, to June 14, 2013, but (assuming a favourable review) granting the employee a pro-rated, rather than full, merit increase, based on the fact that she had worked for only one-quarter of that period.
This provision was also not intended to insulate employees from the effects of negative economic downturns at their workplace such as cuts to wage rates that happened during their leave due to their employer’s economic circumstances. This means that while an employer is required to pay a reinstated employee the wage rate the employee most recently earned (or the rate the employee would have earned had the employee worked through the leave, if that is greater), this provision does not prohibit employers from reducing the employee’s wage rate immediately upon reinstating the employee, either permanently or temporarily (so long as reduction does not constitute a reprisal, e.g. if any part of the reason for the reduction was because the employee took the leave). A unilateral reduction of an employee’s wages may, depending on the circumstances, constitute a constructive dismissal and if the employee resigns in response to the reduction within a reasonable time, the employer will be considered to have terminated (and severed) the employee’s employment under the ESA. (Note, though, temporary wage reductions by the employer for reasons related to did not constitute constructive dismissal under the ESA if they occured during the defined “ period” (March 1, 2020 – July 30, 2022) – see O. Reg. 228/20 for details.)
Section 53.1 provides that an employee's entitlement to any Part XIV leave is in addition to any entitlement they may have to any other Part XIV leave. This includes pregnancy leave, parental leave, family medical leave, family caregiver leave, child death leave, crime-related child disappearance leave, critical illness leave, domestic or sexual violence leave, sick leave, family responsibility leave, bereavement leave, organ donor leave, declared emergency leave and reservist leave.
This provision was added to the Employment Standards Act, 2000 effective January 1, 2019 by the Making Ontario Open for Business Act, 2018. Prior to January 1, 2019, certain individual leave provisions contained similar language to make clear that Part XIV leaves apply independently. With the inclusion of section 53.1, those individual provisions were no longer necessary and were repealed. The wording “for greater certainty” is used because the Employment Standards Program has always taken the position that an employee’s entitlement to a Part XIV leave is independent from his or her entitlement to any other Part XIV leave; this new provision simply codifies that principle.
An employee’s eligibility for more than one leave will depend on the circumstances giving rise to the absence. Take, for example, an employee whose minor child is critically ill with a serious medical condition and has a significant risk of death within 26 weeks. The employee could be eligible for critical illness leave (because the minor child is critically ill), family caregiver leave (because the child has a serious medical condition), family medical leave (because the child has a serious medical condition with a significant risk of death within 26 weeks), and family responsibility leave (because the child has an illness, injury or medical emergency). Taking into account the statutory requirements for each leave, the employee is free to decide when to take each leave and the order in which they’re taken.
The notice provisions in Part XV of the Employment Standards Act, 2000 ensure that employees are given some minimum amount of advance warning of termination of employment (or pay in lieu of notice or some combination thereof) so that the employee may make new arrangements for work.
The severance pay provisions Part XV of the Act provide some long-service employees with compensation for loss of seniority and job-related benefits and also for their investment of long service when the employment relationship is severed by the employer. The employer's obligations under the notice and severance provisions are entirely separate and distinct from each other and one cannot be used to offset the other.
Section 54 requires employers to provide advance written notice of termination, in accordance with s. 57 or s. 58, or to provide termination pay in accordance with s. 61 when terminating the employment of an employee. Under the former Employment Standards Act, pay in lieu of notice was characterized as a remedy if notice was not given, not an alternative to notice as it is now.
An employee is eligible for notice of termination or termination pay if he or she has been continuously employed for three months or more by his or her employer. A similar eligibility requirement was contained in the former Employment Standards Act. However, the word “continuously” has been added to clarify that the employment relationship must continue for a full three months.
All time spent in an employer-employee relationship will count toward the three-month eligibility requirement. As long as there is no clear termination of the employment relationship, periods of inactive employment (such as lay-off, leave or sick time) must be included as periods of time during which an employee is continuously employed.
The term “period of employment”, which is defined in s. 8(2) of O Reg 288/01 to allow separate periods of employment to be added together and treated as one, does not apply with respect to the three-month eligibility requirement for notice in s. 54. Rather, “period of employment” applies to determine the amount of notice the employee is entitled to under s. 57 once it has been established that the employee has met the three-month eligibility requirement.
In addition, when determining the “period of employment”, reference must also be made to s. 59, which sets out what is included and excluded time. Although s. 59 generally provides that time spent on leave or other inactive employment is included in determining the period of employment, it excludes time spent on lay-off after a deemed termination date.
Therefore, the time spent on lay-off after the deemed termination date (i.e., the time spent on lay-off from the date the lay-off commenced) would not count in determining the “period of employment” and the amount of notice an employee is entitled to. That time would, however, count in determining whether the employee had completed three months of continuous employment in order to be eligible for notice.
For example: An employee was hired January 1. She was laid off February 1. Thirteen weeks after the layoff began (May 1), her employment is deemed to be terminated as of the date the layoff began (February 1) – see ESA Part XV s. 56(5).
Under s. 54, all employment (whether active or inactive) counts towards the three-month continuous employment eligibility requirement. This employee has met the three months' continuous employment eligibility requirement; she was employed for four months (January 1 to May 1) and so is eligible for notice of termination.
The amount of notice (or pay in lieu in this case) she is entitled to is determined by s. 57 and turns on her “period of employment”.
Under s. 57 an employee whose “period of employment” is less than one year is entitled to one week's termination notice.
Under s. 59, “period of employment” does not include periods of layoff after the deemed termination date. This employee's “period of employment” is therefore 1 month (January 1 to February 1). As a result, because she was employed for at least three months and her period of employment is less than one year, she is entitled to one week's termination notice.
Note again that the eligibility requirement is three months of continuous employment and not three months of active service. If an employee started work on July 29 and was still employed for any part of the day on October 28, the employee will have been continuously employed for three months despite having been off sick or on layoff or leave for some time between July 29 and October 28. In this example, if the employer terminated the employee on the 28th of October (regardless of whether the employee had a scheduled shift on that day or had started or completed his or her shift) the employee would be eligible for notice of termination.
When determining whether an employee meets the three-month continuous employment eligibility requirement there is occasionally some debate as to when employment commenced. Generally, the first day of employment will be considered to be the first day of work. Although an offer of employment may be made and a contract of employment entered into some period of time before the employee starts work, the Program's view is that the employment relationship commences on the date the employee starts work unless there is clear evidence to indicate otherwise.
With respect to the three months of continuous employment requirement, regard should also be had to ss. 9(1), 10(1) and 10(2) of the Employment Standards Act, 2000, which provide as follows:
9(1) If an employer sells a business or a part of a business and the purchaser employs an employee of the seller, the employment of the employee shall be deemed not to have been terminated or severed for the purposes of this Act and his or her employment with the seller shall be deemed to have been employment with the purchaser for the purpose of any subsequent calculation of the employee's length or period of employment.
10(1) This section applies if the building services provider for a building is replaced by a new provider and an employee of the replaced provider is employed by the new provider.
10(2) The employment of the employee shall be deemed not to have been terminated or severed for the purposes of this Act and his or her employment with the replaced provider shall be deemed to have been employment with the new provider for the purpose of any subsequent calculation of the employee's length or period of employment.
Under these provisions, the employment with the seller or the original service provider and the employment with the purchaser or the new service provider is combined for the purposes of calculating the employee's length of employment, and, therefore, when determining eligibility for notice (as well as for the purpose of calculating “period of employment” when determining the amount of notice to which an employee is entitled.)
If an employee is employed by Company B for two months and Company B sells the business to Company C who employs the employee for a further period of one month, the employee will have met the three month requirement. Company C will then be required to provide the employee with notice of termination of employment or termination pay calculated on the basis of employment with Company B and Company C. For a more detailed explanation of s. 9 and s. 10, please refer to ESA Part IV (Continuity of Employment).
It is important to note that employment is only counted if it is performed in Ontario, or elsewhere as a continuation of the work performed in Ontario. For example, if an employee works for ABC Inc. for two years in Quebec, then is transferred to Ontario, where he or she works for ABC Inc. for two more months, the employee is considered to have only two months of employment with ABC Inc. for purposes of s. 54.
Where the employee performs work outside Ontario that is a continuation of the work performed in Ontario, the time spent outside of the province will be included in calculating the whether the employee has been employed for three months or more.
Section 54 requires that the employer provide written notice of termination to an employee who is entitled to notice. Section 4(1) of O Reg 288/01 sets out the manner in which such written notice may be provided – see O Reg 288/01 s. 4(1) for a detailed discussion.
It is the policy of the Program that although s. 54 requires that notice of termination be in writing, if the notice given to the employee is oral, but such notice is greater in length than the required notice under s. 54 (and meets or exceeds the minimum requirements concerning continuation of wages and benefits), it will be considered a greater right or benefit under s. 5(2) of the Act. This policy is supported by the case of Fanaken v Bell, Temple, 1984 CanLII 1856 (ON SC).
Where the employer is alleging that it gave oral notice greater in length than the required minimum written notice, the onus will be on the employer to show that the employee received and understood the oral notice, and that the notice was specific as to the date of termination.
This section provides that prescribed employees are not entitled to notice of termination or termination pay under Part XV of the Employment Standards Act, 2000. The prescribed employees are identified in s. 2 of O Reg 288/01. Refer to O Reg 288/01 for a complete discussion of the prescribed employees.
As with all exemptions from a minimum standard, the onus is on the employer to establish on a balance of probabilities that the exemption applies.
This definition is relevant for Part XV, ss. 54-62 of the Employment Standards Act, 2000 which refer to a termination of the employment relationship for the purposes of an entitlement to notice of termination or pay in lieu, as opposed to ESA Part XV, ss. 63-66 which refer to a severance of the employment relationship for the purposes of an entitlement to severance pay. Sections that deal with notice of termination or termination pay entitlement use “terminates” or “terminated”. Sections that deal with severance pay entitlement use “severs” or “severed”.
The definition of what constitutes a termination in this section is exhaustive. Only those situations specifically described in the definition will be considered to constitute a termination of the employment relationship. The definition has three parts:
The term "dismisses" in s. 56(1)(a) means a firing or similar ending of the employment relationship by the employer. It occurs on the initiative of the employer as opposed to the employee. An employer may dismiss an employee expressly, for example, by informing the employee that they are fired. An employer may also dismiss an employee implicitly, for example, by demanding the employee's pass card or by telling the employee to resign or they will be fired.
Clause (a) of the definition will also apply where the employer refuses or is unable to continue employing the employee, even if the situation does not involve an actual firing as such. The clause is very broad in its scope and captures the vast majority of situations in which an employee's employment ceases at the instance of the employer. A discussion of some of the issues that may arise in determining whether or not there has been a dismissal follows:
One issue that arises is whether the employee resigned, as opposed to having their employment terminated by the employer. It has generally been held that two things must be established in order to conclude that an employee has quit:
In this regard see, for example: Grimsby Packaging Ltd. v Prokopp (July 23, 1991), ESC 2881 (Dissanyake); Rock Glen Fruit Farms Limited v Nordstrom (February 26, 1992), ESC 2988 (Roberts); and Deluxe Taxi (Barrie) Ltd. v Employees (April 18, 1973), ESC 125 (McNish).
In certain types of situations, the employee's conduct has been found to be inconsistent with quitting. For example:
Certain types of conduct have been found to indicate a resignation. For example:
Notice of termination or resignation of employment, once given, cannot be withdrawn. Whether it is the employer giving notice of termination to the employee or the employee giving notice of resignation to the employer, the cases indicate that the person who gave the notice may not withdraw it unless the other party gives their consent. See Roberts v Creative Hair Design, 2000 CanLII 12795 (ON LRB).The only exception to this is where the termination or resignation announcement is given in the heat of the moment and then withdrawn quickly.
This Program policy reflects the common law. The rationale behind the law and the policy is that the party receiving the notice may have taken certain actions in reliance on it. For example, the employee, after receiving a notice of termination from the employer, may accept a job offer in another city and sell their house. An employer, having received notice of resignation from the employee, may make arrangements to advertise the position or may have actually hired a replacement employee. The cases indicate that it is not necessary to show that the party actually relied on the notice in order to prevent its withdrawal without that party's consent. The possibility of reliance is sufficient. See for example Westburne Central Supply v Green (December 10, 1992), ES 221/92 (Randall).
Is an employee who gives notice of resignation but whose employer responds by terminating their employment entitled to termination pay? The answer is yes, since what the employer did was to terminate the employee's employment before the employee's notice of resignation could take effect. See for example Leon's Furniture Limited/Meubles Leon Ltée v Aelick, 2016 CanLII 77660 (ON LRB). Also see Quebec (Commission des normes du travail) v. Asphalte Desjardins Inc. (2014 SCC 51): although this decision of the Supreme Court of Canada involved Quebec legislation, it affirms the employment law principle that an employment contract is not automatically ended upon receipt of a notice of resignation, that the relationship continues to exist until the date specified in the notice given by the employee, and that an employer that wishes to terminate the contract before the resignation takes effect is required to provide notice of termination/termination pay.
However, the amount of the employee's termination pay entitlement will be based on the shorter of:
For example, an employee with a period of employment of ten years gives notice of resignation on June 2, to be effective June 30. The employer immediately terminates the employee's employment. The employee will be entitled to termination pay based on the shorter of:
Thus, the employee will be entitled to four weeks' termination pay. This is supported by a Divisional Court decision, Re Redpath Industries Ltd. and Ison et al., 1985 CanLII 2192 (ON SC).
Another example is an employee with a period of employment of three years who gives notice of resignation on June 2, to be effective June 30. The employer terminates the employee's employment two weeks into the four-week notice of resignation period. The employee will be entitled to termination pay based on the shorter of:
Thus, the employee will be entitled to two weeks’ termination pay.
However, see O Reg 288/01, s. 2(1) para. 3 for the discussion in regarding the applicability of the wilful misconduct exemption to employees who have resigned and accepted employment with a competitor but prior to commencing work for their new employer put themselves into a serious conflict of interest with their current employer by, for example, disclosing confidential information to the competitor.
The phrase, "otherwise refuses or is unable to continue employing him or her" includes terminations of employment by operation of law such as those that result from bankruptcy (see the decision of the Supreme Court of Canada in Rizzo & Rizzo Shoes Limited (Re), [1998] 1 SCR 27) or frustration of contract. An example of the latter situation would be where the employer is required to cease operations as a result of an order issued under the Environmental Protection Act, RSO 1990, c E.19 ("EPA"). At common law, this might arguably be considered to result in frustration of the employees' employment contracts, but the phrase "unable to continue employing" ensures that the situation is treated as involving a termination by the employer, with the result that the employees whose employment is terminated because the employer was required to cease operations under the EPA are entitled to notice of termination. This is so whether or not the cessation of operations is self-induced by the employer. In other words, it applies to situations where the environmental order issued was not the result of actions or omissions of the employer, as well as to situations where the order was the result of the employer's actions or omissions. The broad language of s. 56(1)(a) of the Employment Standards Act, 2000 eliminated the need for such a provision.
"Otherwise refuses. . . to continue employing" would also cover the situation of an employee employed on a term contract where the employer technically does not dismiss an employee but simply lets the contract expire without renewing it, although this does not necessarily mean that the employee would be entitled to notice or termination pay – see the discussion of the term or task exemption in O Reg 288, s. 2(1), para. 1.
Section 56(1)(b) provides that a termination occurs where an employer constructively dismisses an employee and the employee resigns their employment within a reasonable period in response to the employer's action.
In technical terms, a constructive dismissal exists where the employer repudiates the employment contract by committing an actual breach or an anticipatory breach of a fundamental term of the contract. If the breach (whether actual or anticipatory) is substantial and adverse to the employee, they can elect to end the contract by resigning but is treated in law as if they had been dismissed by the employer.
As distinguished from an actual breach that imposes an immediate change in the terms of the employment contract, an anticipatory breach is a change to the contract of employment that will come into effect at some future date. Key to a finding of anticipatory breach is that the employer has unequivocally stated that at some future point it will no longer abide by the terms of the contract as it presently exists. An employer will not have committed an anticipatory breach by simply proposing (even in extremely strong terms) the desirability, from its perspective, of making changes or inviting the employee to consider the proposal or to negotiate.
However, an anticipatory breach that would give rise to a constructive dismissal if the employee resigns within a reasonable period of time must be distinguished from a situation where the employer is terminating the employment relationship by giving proper written notice of a change to the employment contract to occur on a future specified date.
In the latter case, if the employer provides notice in writing clearly indicating that the employer will be making a unilateral change to the employment contract at a future specified date and it is clear that the employee must either agree to the future change or the employment relationship will end on the specified date, the employer is considered by the Program to have effectively provided notice of termination in accordance with ESA Part XV, s. 54 with an offer of re-employment on new terms and conditions.
In other words, even though the notice of a change to the contract may not specifically state that it constitutes notice of termination with an offer of new employment on different terms effective on a future, specified date, if it is clear that a refusal to accept the change on that date will end the employment relationship, the written notice of the change may be treated as working notice of termination under the Act. In contrast to a constructive dismissal flowing from an anticipatory breach, which requires the employee to resign within a reasonable period in response to the employer's actions pursuant to s. 56(1)(b), if the employee were to resign in response to a notice of a future change as described above (i.e., one which is effectively considered a notice of termination), they would forfeit any additional rights to notice of termination under the Act. See the discussion on Notice of Termination & Termination Pay Obligations below for more information. For information on the application of these principles where an employee is not vaccinated against, or tested for, COVID-19 in accordance with the employer’s policy, see “ESA Termination and Severance Liabilities Where an Employee is Not Vaccinated Against or Tested For COVID-19”.
As noted above, a notice of a future change to a contract will only be considered a notice of termination where it is clear that the current contract of employment will end on a specified date and that the only option available to the employee as of that date is to accept re-employment on the new, amended contract terms. In this regard, see Wronko v Western Inventory Service Ltd., 2008 ONCA 327 (CanLII), in which the Court of Appeal concluded that the employer's notice of a future change did not constitute effective notice of termination. In that case, the employer had provided notice in September 2002 that the employee's contract, which provided for two years termination pay, would be amended in September 2004 to provide a maximum of 30 weeks termination pay. The notice specifically provided that the employee's agreement to the change was "voluntary and is not a mandatory requirement for your continued employment". Over the course of the next two years, the employee on several occasions advised the employer that he would not accept the change. In September 2004, the date the change was to be implemented, the employer advised the employee that if he did not accept the new terms and conditions of his employment, they no longer had a job for him. Despite the employer's argument that the notice of the change which had been given in 2002 constituted notice of termination, the Court of Appeal found that not to be the case on the facts. The Court found that although the employee had made it clear that he would not accept the proposed change to his contract; the employer had failed to make it clear that the refusal to accept the new terms would result in his termination and re-employment would only be offered upon the new terms. The employer was found to have acquiesced to the employee's position and the terms of the existing contract remained in effect. The Court concluded that the case did not involve a constructive dismissal in that the employee did not treat the employment contract as having been repudiated but rather, the employee's employment was terminated in September 2004 and the employer was then liable for two years of termination pay in accordance with the employment contract.
The following criteria must be met to establish a constructive dismissal as a result of a change to the employment contract:
The meaning of the first criterion is self-evident; the second and third criteria are discussed in more detail below.
In determining whether this criterion of the test is met, an officer must first decide whether the term in question is a fundamental term or condition of employment. Terms and conditions of employment may be implicit or explicit. Implicit terms may be established by past practice or custom or judicial ruling. Explicit terms and conditions of employment might be the subject of an oral or written employment contract or may be contained in oral or written workplace policies. Some examples of terms and conditions of employment that would usually be considered fundamental are as follows:
Constructive dismissal will only be established if the change is substantial and adverse to the employee.
What constitutes a substantial change to the employee's disadvantage is a factual determination that will vary with the circumstances of each case. In each case, however, the change must be considered with regard to the particular employee's circumstances, but from the perspective of a reasonable person. The test to be applied is how a reasonable person in the employee's circumstances would view the change.
What follows are some examples of substantial changes to terms and conditions of employment that are generally considered fundamental.
Other breaches of the employment contract that may give rise to a constructive dismissal include forced resignations or sustained harassment or abuse.
A forced resignation occurs where the employer puts the employee to a choice between resigning and some even less palatable alternative, such as where the employer says to the employee, "If you don't resign, I'll fire you." If the employee in fact resigns in response to such a statement, the employee will be considered to have been constructively dismissed by the employer.
If the employer harasses or abuses the employee to an intolerable extent and as a consequence the employee resigns, the employee will be considered as having been constructively dismissed. It is not necessary to show intent on the part of the employer to get rid of the employee in order to find a constructive dismissal. Even in the absence of such intent, there will be a constructive dismissal if the employee resigns in response to the employer's behaviour and that behaviour would be unacceptable to a reasonable person in the employee's circumstances.
In Tiny Town Daycare Inc. v Vlahos, 2015 CanLII 67009 (ON LRB), the Board found that the employer’s treatment of the employee constituted a constructive dismissal and awarded the employee termination pay. The employer subjected the employee to a sexual and gender-related harassment that created a poisoned work environment, which itself was a fundamental breach of the employment relationship. The employer also accused her of defamation, slander and neglect of duty, and threatened to make a complaint that would result in the employee losing her license. The Board held that the employer’s conduct was so reprehensible that the employee felt she had no other alternative than to quit her employment.
Note, however, that unpleasantness, rudeness or misunderstanding of the facts on the part of the employer does not necessarily create the sort of poisoned work environment that can be treated as constructive dismissal by an employee who experiences it – see Mortensen v Convergys CMG Canada Limited Partnership, 2015 CanLII 2630 (ON LRB).
As noted above, s. 56(1)(b) specifically provides that an employee who alleges constructive dismissal is required to resign from their employment within a "reasonable period". Although the employee must at some point resign to signal their rejection of the unilateral imposition of new terms by the employer, in order for s. 56(1)(b) to apply, the resignation does not have to be immediate. The reasonable period affords the employee time to consider whether to accept the change. It is an opportunity to try out the new arrangement or assess the future impact of an anticipatory breach before deciding whether or not to resign and claim constructive dismissal.
Where the breach has immediate consequences, the reasonable period will begin to run from the point the breach impacts upon the employee. In cases of anticipatory breach, the reasonable period will be considered to start running when the employer announces its intention.
It is Program policy that this reasonable period under s. 56(1)(b) is not necessarily the same length as the notice period under ss. 57 or 58. What constitutes a reasonable period may vary with the circumstances of each case. For example, if the employee is paid a salary of $1000 per week and the employer unilaterally reduces the salary to $700 per week effective immediately, what would constitute a reasonable period would be quite short, as very little time would be needed by the employee to determine whether the change was acceptable because the impact on them would be quite obvious. On the other hand, if the employee was a sales employee paid on a salaried basis and the employer unilaterally changed the employee's remuneration to a commissioned basis and gave the employee a new sales territory at the same time, what constitutes a reasonable period in those circumstances may be quite lengthy, as the employee may need to try out the new arrangement for a considerable time before being in a position to gauge its impact on their earnings.
It should be noted that in order to preserve rights to a remedy under the common law, an employee may be expected to stay on under the changed terms beyond what would be considered a reasonable try out period. An employee who wishes to claim damages at common law for failure to give reasonable notice of termination has to show that they have made reasonable efforts to mitigate or lessen those damages, otherwise their damages will be offset by the amount that they could have reduced them by using reasonable efforts. The courts have said that this might require the employee to stay on under the new arrangement where it does not involve work that is substantially different or demeaning and where the work relationship is not acrimonious – see Mifsud v MacMillan Bathurst Inc., 1989 CanLII 260 (ON CA).
However, in order to claim a remedy for constructive dismissal under the ESA 2000, the employee would have to resign within a reasonable period. That may mean that the employee has to choose between protecting their remedy under the common law and successfully claiming for termination pay on the basis of constructive dismissal under the ESA 2000.
For information specific to what is a “reasonable period” in the context of a constructive dismissal resulting from an employer continuing a temporary reduction or temporary elimination in hours of work or wages for reasons related to COVID-19, past the end of the COVID-19 period, see the discussion at section 7 of O. Reg. 228/20.
An immediate or anticipatory unilateral breach of a fundamental term of the employment contract that has adverse consequences is a constructive dismissal and if it is followed by a resignation within a reasonable period of time, it is a termination of employment under the Act. It follows therefore that the employer will have an obligation to provide notice of termination or termination pay in lieu of notice.
However, as discussed above under s. 56(1)(b), if an employer provides proper notice (see below) of a change to the contract that will be implemented on future date, and it is clear that a failure to accept the new terms and conditions of employment on the specified date will result in the existing employment contract being terminated with an offer of re-employment on the amended terms, there is no constructive dismissal. As a factual matter, it is the employer, not the employee who is terminating the employment contract, so the constructive dismissal analysis, which applies when the employee has resigned but is treated in law as if they had been dismissed, is not relevant.
Program policy is that proper notice must also be:
Where all these conditions are met, the employer's notice of the contract change will be considered to be working notice of termination for the purposes of discharging the employer's liabilities for notice under the Act. If the working notice provided is something less than what is required under s. 57 or s. 58, the employer will be liable for the difference in termination pay in the event the employee does not accept the offer of the "new" contract. The employer's liability will be reduced according to the amount of notice that was given. Further, should the employee resign before the end of the notice period, they will have no further entitlements to payment for the balance of the notice period or to termination pay in lieu of notice.
The provision states that a lay-off that exceeds the period of a "temporary lay-off" is a termination. Section 56(2) defines a temporary lay-off. Please see ss. 56(2), (3.1) and (3.3) – (3.6) for a detailed discussion of a temporary lay-off, and the point at which a lay-off will exceed a period of temporary lay-off thereby triggering a termination under s. 56(1)(c).
Note that O. Reg. 228/20 (“Infectious Disease Emergency Leave”) provides that during the defined COVID-19 period (March 1, 2020 to July 30, 2022), non-unionized employees whose wages or hours of work were temporarily reduced or temporarily eliminated by their employer for reasons related to COVID-19 were not considered to be laid off under the ESA (except where the layoff is because of a permanent discontinuance of all of the employer’s business at an establishment). For information on a temporary layoff resulting from a reduction/elimination of hours of work or wages for reasons related to COVID-19 please see the discussion at section 6 of O. Reg. 228/20.
As this section provides that a lay-off is a termination only where the period of lay-off exceeds that of a temporary lay-off, it follows that a temporary lay-off is not a termination and that there is therefore no obligation under the Act to give an employee notice of a temporary lay-off. If an employer does provide notice of lay-off and the lay-off ultimately lasts longer than a temporary lay-off and is subsequently deemed to be a termination, the notice of lay-off cannot generally be set-off against the employer's notice of termination obligations.
Ontario Regulation 288/01, s. 4(2) permits notice of indefinite lay-off to fulfil the employer's notice of termination obligations. The ESA 2000 restricts the application of this provision to situations where an employer would be in breach of a collective agreement if it advised employees that their employment was being terminated. This allows an employer bound by such a collective agreement and who anticipates that a lay-off that it is about to implement will end up resulting in termination for the purposes of the Act, to satisfy the Act's notice requirements by giving notice of indefinite lay-off.
It should be noted that while a lay-off that lasts no longer than the period of a temporary lay-off will not be considered a termination under s. 56(1)(c), if the employee's employment contract does not provide, either expressly or by implication (which could be based on past practice, common understandings or custom in the industry or trade concerned) that they may be laid off, a lay-off, even one that would be considered temporary under s. 56(2), may constitute a constructive dismissal; in that case, if the employee responds to the lay-off by quitting within a reasonable period, the situation will be treated as involving a termination by the employer pursuant to s. 56(1)(b). In this regard, see the discussion of the Ontario Court of Appeal decision in Stolze v Addario.
This section defines a "temporary lay-off" for the purpose of s. 56(1)(c), which provides that a termination occurs when an employee is laid off for a period longer than a temporary lay-off. This section must be read in conjunction with s. 56(3.1)-(3.6), which sets out what constitutes a week of lay-off for the purpose of this section.
This section must also be read in conjunction with s. 56(5), which provides that once a termination is triggered by a lay-off that exceeds the period of a temporary lay-off, the termination is deemed to have occurred on the very first day of the lay-off.
Subject to s. 56(2)(b) and s. 56(2)(c), an employee is considered to be on a temporary lay-off if the employee is on lay-off for no more than 13 weeks within any period of 20 consecutive weeks.
For example, an employee who is laid off for ten weeks, recalled to work for eight weeks and then laid off again for another ten weeks will be temporarily laid off under s. 56(2)(a) because the longest the lay-off lasted in any period of 20 consecutive weeks was 12 weeks. As a result, the employee’s employment would not have been deemed to have been terminated and they would not be entitled to notice of termination or termination pay.
The period of 20 consecutive weeks is a rolling window so that if the employee is laid off for more than 13 weeks in any consecutive 20-week period, the lay-off ceases to be temporary. Neither the employer nor the employee can pick and choose which 20 weeks to use when determining whether the 13-week threshold has been reached. Rather, the threshold is reached and a termination occurs on the first occasion that the layoff exceeds 13 weeks of lay-off in any period of 20 consecutive weeks.
A week of lay-off is defined in s. 56(3.1) with respect to employees with a regular work week and in s. 56(3.3) and s. 56(3.5) with respect to employees who do not have a regular work week.
However, the fact that an employee has a regular work week (i.e., they usually work the same number of hours each week) does not necessarily mean that they usually work the same days each week. Because of this, the point at which the lay-off of an employee with a regular work week will be considered to have exceeded the period of a temporary lay-off so as to trigger a termination may differ according to whether the employee usually works the same days each week or whether the employee instead works different days from week to week.
Similarly, the fact that an employee does not have a regular work week (i.e., they do not work the same number of hours in each week) does not necessarily mean that the employee does not work the same days in each week. Again, the point at which the lay-off of an employee who does not have a regular work week will be considered to have exceeded a period of temporary lay-off so as to trigger a termination will depend on whether the employee usually works the same days each week or works different days each week.
Note that for the purposes of the under 35 weeks in 52 rule, termination is triggered at the point the employee has been on lay-off for a full 35 weeks; thus, the question of when the lay-off exceeds 35 weeks does not arise.
For purposes of s. 56(2)(a), known as the 13 weeks in 20 rule, the Program's position is that where an employee usually works the same days each week, the lay-off will exceed 13 weeks at the first moment of the first day in the 14th week on which the employee would normally have been scheduled to work and on which they do not work. Under s. 56(2)(b), the under 35 weeks in 52 rule, termination is triggered at the point the employee has been on lay-off for a full 35 weeks; accordingly, the question of when the lay-off exceeds 35 weeks does not arise.
Consider an employee who usually works Monday through Friday and who is temporarily laid off as defined in s. 56(2)(a). The employee is initially laid off for ten weeks, goes back to work for four weeks (no longer on layoff) and is then laid off again for another three weeks. The employee has at that point been on a temporary lay-off for a full 13 weeks within a 17- week period. If the employee is subsequently on lay-off on any day that would normally be a work day (i.e., a Monday, Tuesday, Wednesday, Thursday or Friday) within the next three weeks, the lay-off will have exceeded a period of temporary lay-off and a termination will be triggered under s. 56(1)(c).
Note that there would not have to be a full week of lay-off in those next three weeks in order to trigger a termination; the employee has already been on lay-off for a full 13 weeks within the last 17 weeks and so even one second more of lay-off occurring in the next three weeks means that they will have been laid off for more than 13 weeks in a 20-week period.
Although a termination is triggered at this point, the termination is deemed to have occurred on the very first day of the lay-off. In the case of an employee who usually works the same days each week, the first day of layoff can be identified as the first day in the first week of lay-off on which the employee would normally work and on which they did not work. See the discussion of s. 56(5) below regarding deemed termination date.
For purposes of s. 56(2)(a), known as the 13 weeks in 20 rule, the Program's position is that where an employee does not usually work the same days each week, the lay-off cannot be considered to have exceeded 13 weeks until the end of the 14th week of lay-off. In contrast to the situation of an employee who usually works the same days each week, in the case of an employee who does not usually work the same days each week, no particular day within a week that is a week of lay-off can be identified as a day on which the employee continues to be on lay-off. If the employee sometimes works on Tuesdays but often does not work on Tuesdays, the fact that they do not work on a particular Tuesday does not necessarily mean that they are on lay-off that day. In the result, in order to determine that the lay-off has in fact exceeded 13 weeks, we must wait until the end of the 14th week of lay-off before we can know that the employee has been on lay-off for more than 13 weeks. Under s. 56(2)(b), the under 35 weeks in 52 rule, termination is triggered at the point the employee has been on lay-off for a full 35 weeks; accordingly, the question of when the lay-off exceeds 35 weeks does not arise.
Although a termination is triggered at the end of the 14th week of layoff, the termination is deemed to have occurred on the very first day of the lay-off. In the case of an employee who does not usually work the same days each week, just as there is no particular day in the 14th week of lay-off that we can say is a day on which the employee continues to be on lay-off, likewise there is no particular day in the first week of lay-off that we can say was a day on which the employee was on lay-off. Given this, and given the need to be able to ascertain a deemed termination date, the position of the Program is that the first day of the lay-off (and hence the deemed termination date) for an employee who does not usually work the same days each week is the first day of the first week of lay-off. Since the week of lay-off corresponds to the work week, this means that if the employee's work week is Sunday to Saturday, the first day of the lay-off will be the Sunday. See the discussion in s. 56(5) regarding deemed termination date.
Note that where a termination is triggered because of a layoff that exceeds 13 weeks in a period of 20, the employee is entitled under the Act to their termination pay forthwith, even where the contract or collective agreement provides recall rights. In the case of termination pay, the provisions in the Act requiring an election between retention of recall rights (with the employee's entitlement paid into trust) and giving up recall rights (and receiving the entitlement forthwith) apply only if the termination pay entitlement arises because of a layoff of 35 weeks or more – seeESA Part XV, s. 67(1).
As a consequence, when a termination is triggered because of a lay-off that exceeds 13 weeks in a period of 20 consecutive weeks, an employee is entitled under the Act to be paid their termination pay in accordance with ESA Part V, s. 11(5). Nothing in the Act requires that such an employee choose between receiving termination pay forthwith and retaining their recall rights.
Section 56(2)(b) sets out the six circumstances in which a lay-off of more than 13 weeks in any consecutive 20-week period but less than 35 weeks in any period of 52 consecutive weeks is still considered to be a temporary lay-off:
It should be noted that the period of 52 consecutive weeks is a rolling window. Neither the employer nor the employee can pick and choose which 52 weeks to use when determining whether the 35-week threshold has been reached. Rather, the threshold is reached and a termination occurs on the first occasion of there being 35 weeks of lay-off in a period of 52 consecutive weeks. As the termination is triggered at the point the employee has been on lay-off for a full 35 weeks; the question of when the lay-off exceeds 35 weeks does not arise.
In addition, the word "any" in s. 56(2)(b) means, in the case of an employee who accepts a recall, that time spent on lay-off prior to the recall is taken into account in determining whether a post-recall lay-off has triggered a termination (or severance). In other words, both the time spent on lay-off prior to the recall and the time spent on lay-off where the employee is laid off again following the recall is counted in determining whether the employee has been laid off for at least 35 weeks in any 52-week period.
See the Court of Appeal decision in United Steel v National Steel Car Limited, 2013 ONCA 401 (CanLII) and ESA Part XV, 63(1) for a discussion of this case.
The six circumstances in which a lay-off of more than 13 weeks in any period of 20 consecutive weeks but less than 35 weeks in any period of 52 consecutive weeks is still considered to be a temporary lay-off are:
Section 56(2)(b)(i) provides that a lay-off of more than 13 weeks in any 20 consecutive week period but less than 35 weeks in any period of 52 consecutive weeks is still considered to be a temporary lay-off if the employer continues to provide the employee with substantial payments during the period of lay-off.
It is Program policy that the term "continues" indicates that the employer must make ongoing payments to the employee during the entire period of temporary lay-off, including the first 13 weeks of lay-off, in order for this clause to apply. If the employer stops making the payments at any time, the lay-off will cease to be a temporary lay-off under this clause.
The use of the plural as opposed to the singular form of the word "payment" reinforces that the employer must make multiple and continuous payments to the employee during the entire period of temporary lay-off.
Section 56(2)(b)(i) has not been interpreted by a referee, adjudicator, OLRB or court, so employment standards officers may wish to contact the Employment Practices Branch for assistance in the event they are required to consider the application of this provision.
Section 56(2)(b)(ii) provides that a lay-off of more than 13 weeks in any 20 consecutive weeks but less than 35 weeks in any period of 52 consecutive weeks is still considered to be a temporary lay-off if the employer continues to make payments under a legitimate retirement or pension plan or a legitimate group or employee insurance plan during the period of lay-off.
Where the employer's pension or benefit plan contributions are based on a percentage of the employee's wages, the contributions would continue to be made on the basis of the wages the employee was earning prior to the lay-off.
It is Program policy that the words "continues" and "legitimate" indicate that the employer must make ongoing payments for the entire period of the temporary lay-off (including the first 13 weeks) and the employer's payments must be made pursuant to plan provisions that were in existence before the commencement of the lay-off, unless the employee has specifically agreed to an amendment to the plan or the amendment was necessitated by a legitimate cause such as a legislative change.
If, for example, a plan provides that the coverage will end after 26 weeks of lay-off, the employer will not be able to continue to make payments to a legitimate plan after the 26th week and, therefore, the employee will cease to be on a temporary lay-off when the employer stops making the payments. Note however, that with respect to a group or employee insurance plan comprised of multiple plans (e.g., a package consisting of life insurance, extended health accidental death and a long term disability plan) the discontinuance of one of those plans may, in certain circumstances, not trigger the end of a temporary lay-off. See the discussion of such package plans below.
If the employer, with employee agreement, renegotiated the terms of the plan after the commencement of the lay-off to extend the coverage from 26 weeks to 35 weeks, the employee would continue to be on a temporary layoff for up to 35 weeks after the lay-off began. However, if the terms of the plan were renegotiated without employee agreement, the employee would cease to be on a temporary lay-off at the point the employer began making payments pursuant to the new extended plan. This is because the employer is not continuing to make payments pursuant to the plan, so much as starting to make new payments not previously required. Also, it might be inferred that the employer has taken such action in an attempt to extend the temporary layoff past 13 weeks and therefore the requirement that the plan be legitimate is not met. In this regard see Stanton Pipes Ltd. v Turk et al (February 5, 1986), ESC 2035 (Egan).
Another point in regard to these payments is that they must relate to the period of employment after the lay-off began. If, for example, pension plan contributions made during the period of lay-off are in respect of service accrued prior to the commencement of the lay-off, those contributions will not be considered as payments within the meaning of this section.
It is Program policy that there is no requirement that an employer who offers both an insurance plan or plans and a pension plan must continue payments under both the insurance plan or plans AND the pension plan. The employer could continue payments under just the pension plan or just the insurance plan or plans. However, if the employer offers a pension plan and more than one type of insurance plan, and it does not continue payments under the pension plan, it is Program policy that s. 2(b)(ii) will generally not apply unless payments are continued under ALL the insurance plans. Likewise if the employer does not offer a pension plan but does offer more than one type of insurance plan, s. 2(b)(ii) will generally not apply unless payments are continued under ALL the insurance plans. Thus, if the employer continues only part of the insurance coverage (e.g., just life insurance while dropping health insurance) this clause, generally speaking, will not apply.
However, where an employer continues to provide the insurance plan package but through no fault of the employer and for otherwise legitimate reasons part of that coverage (e.g., disability insurance) is subsequently discontinued, the temporary lay-off will continue despite the discontinuance of such coverage. For example, consider an employer who provides a group insurance plan package that includes disability benefits. It may be that an insurer will not provide coverage for disability after a certain point in the layoff and that the terms of the policy specifically state this. In that situation, if disability insurance payments are not continued beyond the point at which coverage under the plan ends, but the employer has other insurance plans under which payments continue to be made, it is the Program's view that the situation will still be covered by s. 2(b)(ii). This assumes that the length-of-coverage provision in the plan was not specifically negotiated by the employer in anticipation of or in response to the lay-off and that the employer could not, prior to the lay-off, have arranged for disability insurance with a different insurer who was willing to offer lengthier coverage. Note, however, that if there are no other insurance plans, the cessation of coverage under the disability plan will mean that s. 2(b)(ii) no longer applies.
The issue has arisen as to what happens in a situation where the plan provides that both the employer and the employee make contributions to the plan, e.g., employer 50 per cent and employee 50 per cent, and the employee is requested to make their share of the contribution and refuses. In such situations, the insurer will not normally accept a partial premium (i.e., only the employer's payment) as sufficient to maintain the plan and may suspend or cancel the plan. In such a situation, should the employee be able to consider themselves as terminated after 13 weeks of lay-off even though that is the result of the employee's failure to pay half the insurance premium? The Program’s policy is that if the employee does this and the employer is prevented as a result from continuing its payments under the plan because the insurer has suspended or cancelled the plan, this clause will apply and the lay-off will still be considered to be temporary past the 13-week point. In this situation however, it is Program policy that the employer should do everything reasonably possible to ensure continued coverage for the employee, such as taking advantage of any grace periods and contacting the employee to ensure the employee's failure to pay was not due to an oversight.
Section 56(2)(b)(iii) provides that a lay-off of more than 13 weeks in any 20 consecutive week period but less than 35 weeks in any period of 52 consecutive weeks is still considered to be a temporary lay-off if the employee is in receipt of supplementary unemployment benefits.
Supplementary unemployment benefit plan means an arrangement, other than an arrangement in the nature of a superannuation or pension fund or plan or an employees profit sharing plan, under which payments are made by an employer to a trustee in trust exclusively for the payment of periodic amounts to employees or former employees of the employer who are or may be laid off for any temporary or indefinite period.
If the employer's SUBS plan does not meet the definition in the ITA, with the result that the payments would not be considered supplementary unemployment benefits under s. 56(2)(b)(iii), the payments the employer makes may instead satisfy the conditions in s. 56(2)(b)(i), if the plan is bona fide and the payments continue to be made through the period of lay-off.
Section 56(2)(b)(iv) provides that a lay-off of more than 13 weeks in any 20 consecutive week period but less than 35 weeks in any period of 52 consecutive weeks is still considered to be a temporary lay-off if the employee is employed elsewhere during the lay-off and would have received SUBS had they not been so employed.
Section 56(2)(b)(v) provides that a lay-off of more than 13 weeks in any 20 consecutive week period but less than 35 weeks in any period of 52 consecutive weeks is still considered to be a temporary lay-off if the employer recalls the employee within the time approved by the Director of Employment Standards. There is no requirement that the employee be in receipt (or entitled to) any of the payments described in ss. 56(2)(b)(i)-(iv) during the lay-off.
Some of the factors the Director or their delegate (see Delegation of Powers) may consider in determining whether to provide approval are:
Note that this list is not intended to be exhaustive.
Section 56(2)(b)(vi) provides that a lay-off of more than 13 weeks in any 20 consecutive week period but less than 35 weeks in any period of 52 consecutive weeks is still considered to be a temporary lay-off if the employer recalls the employee within the time set out in an agreement between the employer and the employee. This provision only applies to an employee who is not represented by a trade union. The agreement must be in writing in accordance with ESA Part I, s. 1(3). Note also ESA Part I, s. 1(3.1) which addresses agreements in electronic form.
There is no requirement that the Director of Employment Standards approve the agreement. There is also no requirement that the employee be in receipt (or entitled to) any of the payments described in ss. 56(2)(b)(i)-(iv) during the lay-off.
Section 56(2)(c) provides that a temporary lay-off can last for a period that is longer than the period described in s. 56(2)(b) if the employee is represented by a union and the employer recalls the employee within the time set out in an agreement between the employer and the union. However, in National Automobile, Aerospace Transportation and General Workers Union of Canada (C.A.W. – Canada) Local No. 27 v London Machinery Inc., 2006 CanLII 8711 (ON CA), the Ontario Court of Appeal held that in order for s. 56(2)(c) to apply, the employee must be recalled before the lay-off has reached a total of 35 weeks in a 52 week period.
There is no requirement that the Director of Employment Standards have approved the agreement in order for it to be effective. Further, there is no requirement that any of the conditions set out in ss. 56(2)(b)(i) to (iv) have been met.
Section 56(3) defines "excluded week" as a week during which the employee did not work for one or more days because the employee is not able or available to work, is subject to disciplinary suspension or is not provided with work because of a strike or lock-out occurring at their place of employment or elsewhere.
Subsection 56(3.1) defines what constitutes a week of lay-off in the case of employees who work a regular work week for the purpose of determining whether a period of temporary lay-off (as defined in s. 56(2)) is exceeded, thereby triggering a termination as per s. 56(1)(c). The point at which a temporary lay-off ceases to be temporary and triggers a termination is discussed in detail in s. 56(2) above.
Subsection 56(3.1) refers to regular rate and regular work week, which are defined terms in s. 1 as follows:
Refer to ESA Part I, s. 1 for a detailed discussion of these terms.
For an employee who has a regular work week, a "week of lay-off" is a week, other than an excluded week, in which the employee receives less than 50 per cent of the wages they would earn at their regular rate for a regular work week. This means that an employee may be deemed to be on a lay-off for purposes of s. 56 even though they are still doing some work.
In determining what seven-day period should be looked at for the purpose of determining whether there has been a week of lay-off, reference should be made to the same seven-day period as would make up the employee's work week, i.e., a recurring period of seven consecutive days selected by the employer for the purpose of scheduling work, or, where the employer has not selected such a period, a recurring period of seven days beginning on Sunday and ending on Saturday.
It should be borne in mind that a week of lay-off does not include an excluded week, as defined in s. 56(3). In other words, where:
Any week in which an employee is not able to work because they are, for example, off on sick leave, workers' compensation, or is otherwise unable to work for medical reasons will not be a week of layoff.
Any week in which an employee is unavailable for work (for example, because they are in jail, or on a Part XIV leave) will not be a week of lay-off.
Where an employee has found work with another employer during the lay-off, the employee may, depending on the facts, still be considered to be available for work with the employer that laid them off, regardless of whether the new employment is of a temporary or a permanent nature. Any week during which the employee is employed by another employer would be considered a week of lay-off as regards the employer who had laid them off provided that the employee would, if recalled by the employer during that week, be able to immediately return to work for that employer or at least be able to return to work on the same day as the recall.
Any week in which an employee is on disciplinary suspension is not a week of lay-off. It is important to ensure, though, that the disciplinary suspension is bona fide and is within the employer's express or implied authority under the contract of employment.
Any week in which an employee is not provided with work by the employer due to a strike or lock-out at the employee's place of employment, or elsewhere, is not a week of lay-off.
It is important to note that the strike or lock-out need not be at the employee's place of employment. For example, if there is a strike or lock-out at a supplier, and the employer is a manufacturer dependent upon the supplier for its parts, that employer may be forced to close down until the strike or lock-out is over or a new supplier can be found. In that case the employees of the manufacturer are not considered to be on a lay-off during the temporary closure that occurs as a result.
It is the Program's position that if an employee's employer is not providing work because it is the one doing the locking out, the lock-out must be a lock-out that is legal under the Labour Relations Act, 1995, SO 1995, c 1, Sch 1, in order for an affected week to be considered an excluded week. In those circumstances, the employer's failure to provide work flows from the right to lock out the employees under the Labour Relations Act, 1995 and the employer should not suffer any adverse consequences for exercising that right.
On the other hand, if the lock-out is by the employee's employer and is illegal, the Program's position is that a week in which the employees are illegally locked out is a week of lay-off and not an excluded week. However, a week of strike, whether illegal or legal, will be considered by the Program to be an excluded week (i.e., not a week of layoff) because the employer does not in those circumstances have any control over whether work is provided.
In regard to termination and strike or lock-outs, note that O Reg 288/01, s. 2(1) para 8 establishes an exemption from the notice obligations under the Act where an employee has been terminated during or as a result of a strike or lock-out at their place of employment.
This subsection provides that an excluded week is included in counting the periods of 20 and 52 consecutive weeks used to determine whether a layoff is a temporary lay-off, as defined in s. 56(2).
Subsections 56(3.3) to (3.6) effectively define what constitutes a week of lay-off with respect to an employee who does not have a regular work week for the purposes of determining whether a period of temporary lay-off, as defined in s. 56(2), is exceeded, thereby triggering a termination as per s. 56(1)(c). Note that the point at which a temporary lay-off ceases to be temporary and triggers a termination in accordance with s. 56(2) is discussed in detail in s. 56(2) above.
In applying these provisions, the Program takes the position that a week of lay-off is identified by reference to the seven-day period in which the employer schedules work (the work week) for employees who do not have a regular work week. Note that the definition of work week in ESA Part I, s. 1 states that if the employer has not selected a seven-day period for the purposes of scheduling work, the work week is considered to be Sunday to Saturday.
Subsection 56(3.3) provides that an employee who does not have regular work weeks will have been laid off for more than the period of a temporary lay-off (i.e., their employment will be terminated) if for more than 13 weeks in a period of 20 consecutive weeks the employee earns less than one-half the average amount they had been earning per week in the 12 consecutive weeks preceding the first week of lay-off in the 20-week period.
Likewise, s. 56(3.5) provides that an employee who does not have regular work weeks will have been laid off for more than the period of a temporary lay-off (i.e., their employment will be terminated) if for at least 35 weeks in a period of 52 consecutive weeks the employee earns less than one-half the average amount they had been earning in the 12 consecutive weeks preceding the first week of lay-off in the 52-week period.
In other words, for an employee who does not have a regular work week, the first week of a lay-off will be the first work week in which the employee earns less than 50 per cent of the average earned per week over the 12-week period preceding the 20- or 52-week period.
Note however that s. 56(3.4)(b) and s. 56(3.6)(b) provide that if the 12-week period referred to in either s. 56(3.3) or s. 56(3.5) contains an excluded week, the average amount earned is to be calculated based on the earnings in weeks that were not excluded weeks divided by the number of weeks that were not excluded weeks.
Subsections 56(3.4)(a) and 56(3.6)(a) provide that excluded weeks are not counted as weeks of lay-off for the purpose of determining whether the employee has been laid off for a period than a temporary lay-off (i.e., for more than 13 weeks in a period of 20 consecutive weeks or for at least 35 weeks in a period of 52 consecutive weeks) under s. 56(1)(c), s. 56(2)(a) and s. 56(2)(b). However, excluded weeks do count as part of the 20-week and 52-week period referred to in s. 56(2)(a) and s. 56(2)(b).
Section 56(4) permits employers to place employees, unionized or otherwise, on a temporary lay-off without having to provide the employee with a date of recall.
This section clarifies that the employment of employees who are laid off without a recall date is not terminated, provided that the period of temporary lay-off does not exceed that of a temporary lay-off as defined in s. 56(2).
Section 56(4) reverses Program policy under the former Employment Standards Act, which was adopted in response to a decision of the Court of Appeal in Stolze v Addario. The Court had found that because a "notice of indefinite lay-off" was deemed to be a notice of termination under s. 8(3) of O Reg 327 under the former Employment Standards Act, a lay-off without a recall date was, in effect, an immediate termination. Under the ESA 2000, a notice of indefinite lay-off will be considered to be a notice of termination only where an employer who is bound by a collective agreement is precluded by that agreement from giving an employee notice of termination despite the employer's intention to lay the employee off for a period longer than a temporary lay-off. See the detailed discussion at O Reg 288/01, s. 4(2).
Section 56(5) provides that where the lay-off ceases to be temporary, the employee's employment will be deemed to be terminated as of the first day of the lay-off, not the date on which the lay-of ceased to be temporary. In other words, once a lay-off exceeds a period of temporary lay-off as defined in s. 56(2) and a termination is triggered, it is necessary to identify the first day of the lay-off as this will be the deemed termination date in accordance with s. 56(5). See the discussion in s. 56(2), which defines a temporary lay-off and discusses at what point a temporary lay-off is exceeded and thus when a termination is triggered.
In the case of an employee who usually works the same days each week, the Program's position is that the first day of the lay-off is the first day in the first week of lay-off on which the employee would normally work and on which they did not work.
Consider for example an employee whose employer schedules work on a Monday through Sunday basis and who regularly works Monday through Friday.
Pursuant to s. 56(5), the employee is deemed to have been terminated back on Tuesday, March 2.
In the case of an employee who does not usually work the same days each week, no particular day in the first week of lay-off can be said to be the first day on which the employee was laid off as a factual matter. The position of the Program, however, is that where it is necessary to identify some day as the first day of the lay-off and hence the deemed termination date, the only sensible approach is to consider it to be the first day of the first week of layoff. Bearing in mind that a week of lay-off should correspond to the work week, if the work week is from Sunday to Saturday, the first day of the lay-off will be considered to be the Sunday of the first week of lay-off, and that day will be the deemed termination date. See the discussion at ss. 56(3.1), (3.3) to (3.6) on what constitutes a week of lay-off with respect to an employee who does not have a regular work week for the purposes of determining whether a period of temporary lay-off.
As a consequence of a combination of this deeming provision and s. 59(2), the amount of the entitlement to pay in lieu of notice for individual terminations (that is, where the mass notice entitlements are not triggered) under ESA Part XV, s. 61 is based on the period of employment as it stood on the day the lay-off began.
Note that this is so even though the employee worked some days after the lay-off commenced. For example, consider an employee whose work week is from Sunday to Saturday and who normally works five days a week, Monday to Friday:
Week beginning Sunday, January 9:
Week beginning Sunday, May 22:
Once the lay-off continues into this week (i.e., into the first instant of the first day of the week which would normally be a work day) the employee has been laid off for more than 13 weeks in a 20-week period. As a result, employment is deemed to have been terminated as of January 10, the first day of lay-off.
The period of employment for the purposes of calculating this employee's notice/pay in lieu entitlement will be considered to have ended on January 10 even though the employee did some work after that date.
Note, however, that the entire period of lay-off will be included in determining the employee's length of employment for the purposes of determining whether the employee has been continuously employed for three months or more in order to qualify for notice or termination pay under ESA Part XV, s. 54.
As s. 56(1)(c) provides that a termination only occurs where the period of lay-off exceeds that of a temporary lay-off, it follows that a temporary layoff is not a termination and that there is no obligation under the Act to give an employee notice of a temporary lay-off. If an employer does provide notice of lay-off and the lay-off is subsequently deemed to be a termination, the notice of lay-off cannot be set-off against the employer's notice of termination obligations, except where O Reg 288/01, s. 4(2) applies.
This section is similar to part of the corresponding provision (s. 57(1)) of the former Employment Standards Act.
Section 57 establishes the length of notice of termination that an employee is entitled to under s. 54. This section also establishes the notice period for the purpose of s. 60 (requirements during notice) and s. 61 (calculation of termination pay in lieu of notice). This section must be read in conjunction with s. 59 of the Employment Standards Act, 2000 and s. 8 of O Reg 288/01, which set out what time must be included in the period of employment, and the start and end date of the period of employment, respectively, for the purposes of calculating the employee's entitlement.
Section 59(1) of the Act provides that time on leave, lay-off and other inactive employment (e.g., vacation, sick time) is included in determining the period of employment for purposes of calculating the amount of the employee's notice entitlement. However, under s. 59(2) time spent on lay-off after the deemed termination date (i.e., from the day after the date the lay-off commenced is not included). For a detailed discussion refer to ESA Part XV, s. 59.
Period of employment is defined in s. 8(1) of O Reg 288/01 as the period beginning the day the employment most recently commenced and ending the day notice of termination was provided (if it was provided in accordance with Part XV) or the day the employee's employment is terminated (if notice was not given in accordance with Part XV). Two successive periods of employment that are not more than 13 weeks apart are to be added together and treated as a single period of employment under s. 8(2) of O Reg 288/01. For a detailed discussion refer to O Reg 288/01, s. 8.
Section 4(1) of O Reg 288/01 sets out the manner in which the notice must be given. Please see O Reg 288/01, s. 4.
Section 58(1) provides for longer periods of notice in so-called "mass termination" situations than is provided in s. 57. The section must be read in conjunction with s. 3(4) of O Reg 288/01, which sets out an exception (i.e., the 10% rule) to the application of s. 58. See O Reg 288/01, s. 3(4) for a discussion.
The prescribed period of notice that must be given once s. 58 is triggered is set out in s. 3(1) of O Reg 288/01. The prescribed manner in which the notice must be given is set out in s. 4 of O Reg 288/01. Refer to O Reg 288/01 for a discussion of those provisions.
A mass termination under s. 58 is considered to have occurred when all of the following conditions are met:
Each condition is discussed below.
This condition is met when 50 or more employees have their employment terminated. The "50 or more" threshold is based on the number of employees whose employment is terminated in the same four-week period and not on the number of employees who are given notice of termination in the same four-week period as was the case under the corresponding provision of the former Employment Standards Act.
Questions sometimes arise as to whether employees whose employment is terminated but who are not themselves entitled to notice (for example, because they have been employed for less than three months or because they are exempt under s. 2 of O Reg 288/01) are included in the count for purposes of determining whether the "50 or more" threshold has been met. It is Program policy that all employees to whom the Employment Standards Act, 2000 applies (which does not include those individuals set out in ss. 3(2), (3) and (5) of the Act) and whose employment is terminated are included the count. Note, however, that employees of temporary agencies are employees of the agency, and would only be counted for the purpose of determining whether the agency has hit the 50-employee threshold – they would not be counted for the purpose of determining whether the agency client in whose workplace the agency employee was placed has hit the 50-employee threshold.
This condition requires that the terminations all occur at the same "establishment". "Establishment" is defined in s. 1 of the Act as a location where the employer carries on business. Separate locations are considered to be one establishment if they are located in the same municipality. Locations in different municipalities are considered to be one establishment if one or more employees at a location in one municipality have bumping rights to a location in a different municipality.
For example, if XYZ Company has four plants in Toronto, and a plant in Barrie to which the employees in Toronto may bump, then the establishment as defined in the Act will consist of the four Toronto plants as well as the Barrie plant. The "establishment" will include unionized as well as non-unionized employees at the locations in question, even if the latter group does not have bumping rights.
Please refer to ESA Part I, s. 1 for further discussion of the term "establishment".
This condition requires that the terminations all occur within the same four-week period.
The four-week period is a "rolling window". The employer cannot, however, pick and choose which four-week period to use when determining whether the 50-termination threshold has been reached. Rather, the threshold is reached and a mass termination occurs on the first occasion of there being 50 or more employees terminated in any four-week period. Where terminations are triggered by a lay-off that exceeds a period of temporary lay-off, the deemed termination date (the first day of lay-off) is considered to be the termination date for the purposes of determining whether 50 or more employees have been terminated within the same four-week period. See the discussion at ESA Part XV, s. 56.
This section provides that an employer who is required to give notice under s. 58(1) (i.e., where there is a mass termination) shall provide prescribed information to the Director of Employment Standards in a form approved by the Director. It further requires the employer to post in the employer's establishment on the first day of the notice period the prescribed information in the form approved by the Director. It should be noted that the posting of the form does not relieve the employer of the obligation to provide individual written notice to each employee where such individual notice is required (see s. 4 of O Reg 288/01); note also, however, that s. 5 of O Reg 288/01 provides that individual notice is not required in certain circumstances where employees have bumping rights. See the discussion of these provisions in O Reg 288/01.
Section 3(2) of O Reg 288/01 prescribes the information that is to be provided and posted (see O Reg 288/01). The form that has been approved by the Director for this purpose is the "Form 1". The Form 1 may be downloaded from the Ministry of Labour, Training and Skills Development's website.
Section 58(5) of the Act sets out where and for how long the employer must post the Form 1 – see subsection (5) below for a discussion). Note that where an employer pays termination pay in lieu of providing mass notice that the employer will still be required to provide a Form 1 to the Director but will not be required to post it. See the discussion of s. 61(2) of the Act in ESA Part XV, s. 61.
As with individual notice of termination, nothing precludes an employer from providing a greater right or benefit with respect to mass notice (whether orally or in writing). However, the employer would not thereby be relieved of the obligation to file a Form 1 and post the information by the first day of the statutory portion of the notice period. In addition, that part of the notice period that would be the statutory notice period – i.e., that part equal to the notice required under Part XV and ending on the termination date (see definition of "statutory notice period" at ESA Part I, s. 1) would not start running until a Form 1 was received by the Director, pursuant to s. 58(4).
One question that arises is what level of detail must be provided in the Form 1 before it is considered to fulfil the s. 58(2) requirement. The employer need not complete Form 1 in exhaustive detail. However, the employer must provide an answer to all the questions. For example, it is sufficient to answer the question regarding the economic circumstances surrounding the terminations with "business slowdown".
This section is substantially the same as the corresponding provision (s. 57(5)) of the former Employment Standards Act.
This section sets out the types of information that may by regulation be required to be provided to the Director and posted in the employer's establishment pursuant to s. 58(2). Section 3(2) of O Reg 288/01 is the provision that prescribes the specific information that is to be provided and posted – see the discussion at O Reg 288/01.
This section states that notice of mass termination shall not start running until the Director of Employment Standards receives the completed Form 1. Section 3(3) of O Reg 288/01 sets out how the form is to be delivered. Refer to O Reg 288/01 for a discussion of that section.
The financial consequences to an employer who does not deliver the Form 1 prior to or at the time of giving notice to employees under s. 58(1) may be significant. For example, an employer is required to give 16 weeks' mass notice to 550 employees. It does so, but does not deliver the Form 1 until 8 weeks later. The employer in this case will be liable for eight weeks' pay in lieu of notice to 550 employees. Assuming a 40-hour work week paid at minimum wage, this would amount to approximately $2 million dollars. Accordingly, employers should be advised to take care in ensuring that the Form 1 is properly delivered in accordance with s. 3(3) of O Reg 288/01.
Section 58(5) provides that the employer shall post the Form 1 in at least one conspicuous place in the employer's establishment where it is likely to come to the attention of the affected employees.
This section also requires the employer to keep the Form 1 posted throughout the required notice period. This period corresponds to the "statutory notice period" – see Part I, s. 1 for a discussion of the definition. The fact that an employer failed to post or keep posted a copy of the Form 1 will not prevent the notice period from running so long as the form was received by the Director of Employment Standards – see St. Laurent and Nacci v Kelsey Hayes Canada (March 10, 1997), ESC 95-02B (Muir).
This section, when read together with s. 58(7), is substantially the same as the corresponding provision (s. 57(15)) of the former Employment Standards Act.
Section 58(6) requires an employee who has received notice of mass termination under s. 58(1) to give one or two weeks' written notice to the employer (depending on the employee's period of employment) if the employee wishes to resign before the mass notice period expires. This requirement is subject to the exception set out in s. 58(7). See subsection (7) below for a discussion.
The purpose of this provision is to enable an employer that is, for example, closing down a plant, to know from week to week what its work force will be so that it can close the facility in an orderly manner.
This section, when read together with s. 58(6), is substantially the same as the corresponding provision (s. 57(15)) of the former Employment Standards Act.
Section 58(7) creates an exception to the requirement in s. 58(6) that employees who have received notice of mass termination must give notice to the employer of their intention to resign before the mass notice period expires (see subsection (6) above for a discussion). The exception applies where the employer has constructively dismissed the employee, or has breached a term of the employment contract, whether or not that breach constitutes a constructive dismissal. See ESA Part XV, s. 56(1) for a detailed discussion of the concept of constructive dismissal.
Section 59(1) states that time spent by an employee on leave (e.g., the Part XIV statutory pregnancy, parental, family medical, family caregiver, critically ill child care, crime-related child death or disappearance, organ donor, personal emergency, declared emergency, and reservist leaves, and any other type of leave of absence such as educational leave) or other inactive employment (e.g., temporary lay-off, vacation, sick time) is included when determining an employee's period of employment. This is relevant for purposes of calculating the amount of the employee's notice entitlement (see s. 57).
This section must be read in conjunction with s. 59(2), which provides that time spent on lay-off after the deemed termination date (i.e., from the day after the date the lay-off commenced) is not included when determining an employee's period of employment.
This provision must also be read in conjunction with s. 8 of O Reg 288/01. Section 8(1) defines “period of employment” as the period beginning the day the employment most recently commenced and ending the day notice of termination was provided (if it was provided in accordance with Part XV) or the day the employee's employment is terminated (if notice was not given in accordance with Part XV). Section 8(2) provides that two successive periods of employment that are not more than 13 weeks apart are to be added together and treated as a single period of employment. Refer to section O Reg 288/01 for a detailed discussion of s. 8 of O Reg 288/01.
Section 59(2) provides that in circumstances where a "temporary lay-off becomes a termination, none of the period of lay-off after the "deemed termination date" (which is, pursuant to s. 56(5), the first day of lay-off) is included in the employee's “period of employment”.
The “period of employment” determines the amount of notice the employee is entitled to under s. 57 of the Employment Standards Act, 2000. However, it is important to note that eligibility for notice does not depend on “period of employment” but rather is determined by whether the employee has three months of "continuous employment" as per s. 54 of the Act.
As a consequence, time spent on layoff after a deemed termination will not be included in the period of employment for the purposes of determining the amount of notice the employee is entitled to, whereas the time spent on layoff after the deemed termination date will count towards the completion of the three months eligibility requirement for notice under s. 54 of the Act.
For example: An employee was hired January 1. She was laid off one month later on February 1. Thirteen weeks after the layoff began on May 1, her employment is deemed to be terminated as of the date the layoff began on February 1 – see s. 56(5).
Under s. 54, all employment (whether active or inactive) counts towards the three month continuous employment eligibility requirement. This employee has met the three months continuous employment requirement; she was employed for four months from January 1 to May 1 and so is eligible for notice of termination.
The amount of notice (or pay in lieu in this case) she is entitled to is determined by s. 57 and turns on her “period of employment”.
Under s. 57 an employee whose “period of employment” is less than one year is entitled to one week's termination notice.
Under s. 59, “period of employment” does not include periods of layoff after the deemed termination date. This employee's “period of employment” is therefore one month (January 1 to February 1). Accordingly, she will be entitled to one week's pay in lieu of notice.
Section 60(1) sets out the employer's obligations with respect to maintaining terms and conditions of employment and payment of wages and benefit plan contributions during the statutory notice period where notice of termination is given. The obligations set out in this section apply only to the statutory notice period. Where an employer gives notice that is greater in length than the statutory notice, these obligations will not apply to the part of the notice period that precedes the statutory notice period. The statutory notice period is defined in ESA Part I, s. 1 as the period equal to the employee's entitlements under the ESA 2000 that ends on the termination date specified in the notice (i.e., the last part of the notice period). For example, where the employer gives 12 weeks' notice, and the notice entitlement is eight weeks, the above-noted obligations would apply only to the last eight weeks of the 12 weeks of notice. Refer to ESA Part I, s. 1 for further discussion of statutory notice periods.
It should also be noted that under O Reg 288/01, s. 7, an employer is not permitted to schedule an employee's vacation during the statutory notice period, unless the employee, after having received the notice agrees to take their vacation during the notice period. Even if the vacation had been scheduled prior to the employer's decision to give notice of termination, the employee's consent would have to be obtained, after the employee received the notice.
Finally, if an employee resigns during the statutory notice period or is terminated in circumstances that would exempt the employee from notice of termination under O Reg 288/01, s. 2, the employer will cease to have any obligations under this section at the point that the employment relationship ends.
Under s. 60(1)(a), an employer is prohibited from reducing the employee's wage rate or altering any other term or condition of employment during the statutory notice period.
This section prevents an employer from modifying the employee's duties during the notice period (which would include laying the employee off), unless the modifications were permitted pursuant to a term or condition of employment. If the employee had been performing the allegedly "new" duties for some time prior to receiving the notice to the degree that the new duties form part of the employment terms or conditions, there would not be a violation of this provision.
For example, in Royal Oak Mines Inc. v Battochio (October 30, 1992), ES 189/92 (Muir), a case decided under the former Employment Standards Act, an employer gave notice of termination to an employee working in northern Ontario, but required them to work out the notice period at the employer's mine in the Northwest Territories. The referee found that prior to receiving the notice of termination, the employee had travelled back and forth between Ontario and Northwest Territories on a regular basis in connection with their job duties. On that basis, the referee concluded that the employer had not altered the underlying terms of employment in requiring the employee to work out their notice in the Northwest Territories location.
Under s. 60(1)(b), an employer is required to pay during each week of the statutory notice period, the greater of the wages the employee is entitled to receive (i.e., what was actually earned in each week) and the employee's regular wages for a regular work week. It is the Program's position that because these wages are earned (either actually or notionally) during the notice period, they will also attract vacation pay. If the employee's contract of employment provides for vacation pay to be calculated at a greater rate than the minimum standard, the contract rate will apply.
Where the employee does not have a regular work week, s. 60(2) sets out a method for calculating the entitlement under s. 60(1)(b) by averaging the wages earned in the weeks worked within the 12-week period preceding the date notice was given.
One question that may arise is what are the regular wages for a regular work week when the employee suffered a pay cut or, conversely, a pay increase a short time prior to being given notice? For example, what would the regular wages for a regular work week be for the purposes of the notice period if, a short time prior to the notice being given, the employer had cut the employee's hours by 20 per cent because of a shortage of work that ultimately led to the employee's termination?
Where an employee's hours or pay rate is changed (whether an increase or a decrease) a short time prior to the notice being given, an issue may arise as to whether the resulting change in the employee's earnings changes what would otherwise constitute their regular wages for a regular work week for the purposes of s. 60(1)(b) or whether the pre-change regular wages for a regular work week should be used. This is a question of fact, which can only be answered on a case-by-case basis. Although a change that occurs just prior to termination may look suspicious, the critical factor is not when the change occurred but whether or not the change was bona fide and intended to be permanent. See the following decisions under the former Employment Standards Act: Ingersoll Rand : Proto Canada, Division of Ingersoll-Rand Canada Inc. v United Automobile, Aerospace and Agricultural Implement Workers of America et al (May 12, 1983), ESC 1421 (Roberts) and Mothers Inc., Little Caesars of Canada and Little Caesars International Inc. v Fraser et al (September 11, 1991), ESC 2907 (Barton).
Another question that may arise concerns work sharing programs under the federal employment insurance legislation, under which employees' hours are reduced and the resulting reduction in pay is topped up by employment insurance benefits. As work sharing programs are intended to be temporary, the Program does not consider the reduction in wages paid by the employer to affect what would otherwise constitute the employee's regular wages for a regular work week.
It is the Program's position that s. 60(1)(b) means that an employee is to be paid during the notice period whether or not they performed work, and that payments pursuant to a pension, sickness or disability plan or worker's compensation legislation cannot be used to offset the employer's obligations with respect to notice of termination or pay in lieu of notice. Section 60(1)(b) requires the employer to pay no less than the amount that would equal an employee's regular wages during the whole of the notice period. The provision does not require the employee to earn any wages during this notice period. See Loeb Packaging Ltd. v Lacroix, 2016 CanLII 32625 (ON LRB), in which the Board upheld the Program's interpretation of s. 60(1)(b).
In addition, because payments such as pension benefits, employment insurance benefits, short-term disability benefits and worker's compensation benefits are not wages under ESA Part I, s. 1, and therefore could not be considered to represent any portion of the regular wages for a regular work week to which the employee is entitled, they could not be used to offset the employer's obligation under s. 60(1)(b). Therefore, the employer is required to pay the greater of the wages actually earned and the employee's regular wages for each week of the notice period, whether the employee was on contractual short-term disability leave, or any other type of leave, such as education leave, or any statutory leave under ESA Part XIV, and whether or not they were in receipt of any benefits, employment insurance benefits or worker's compensation payments.
However, note that if an employee took paid personal emergency leave between January 1, 2018 and December 31, 2018 during the statutory notice period, the employee had an entitlement to personal emergency leave pay as per the provisions that were in force at the time (ESA Part XIV, ss. 50(9), (10) and (11)). This is because personal emergency leave pay was included in the definition of wages (but not regular wages). The personal emergency leave pay would be counted in the wages the employee was entitled to receive in assessing whether the employee received their regular wages for a regular work week.
However, the employer will not be required to continue to pay wages to an employee during any portion of what would have been the notice period that follows the employee's resignation or a termination by the employer for conduct that constitutes wilful neglect of duty, wilful misconduct or disobedience that was not condoned by the employer. For example, if an employee is not on a contractual or statutory leave of absence during the notice period and the employee simply refuses to come in to work during the notice period, the employee would be guilty of wilful neglect of duty and would not be entitled to notice of termination (or pay in lieu of notice) provided that the employer had not previously condoned such behaviour.
Under s. 60(1)(c), an employer is required to continue to remit all of the contributions necessary in order to maintain all of the employee benefit plans for the entire notice period. Under this provision, the employer is obliged to continue remitting the employer's share of the contributions to the employee's benefit plans as well as the employee's share (if any) in order to maintain the benefit plans to the end of the notice period.
Assuming the employer had the necessary written authorization, the employer would simply deduct the employee's share of the benefit plan contributions from the wages paid during the notice period and would then remit both the employer and employee share to the insurer to ensure coverage was maintained throughout the notice period.
If the employer does not remit its share of the benefit plan contributions as required by this section, s. 60(3) deems the contributions to be wages (which are otherwise not defined as such under ESA Part I, s. 1) for the purposes of ESA Part XXII, s. 103, which provides the power to issue an order to pay wages against the employer. However, it is important to note that such an order to pay is limited to the amount of the employer's share of the unpaid benefit plan contributions.
If coverage was not maintained during the notice period and the employee incurred costs as result, the order to pay against the employer would not compensate the employee for the value of the benefits that the employee would have enjoyed had the coverage been maintained because such benefits are not wages under ESA Part I, s. 1, although the employee may be able to pursue a civil action to recover those amounts.
Section 60(2) sets out a method for calculating the employee's pay during each week of the notice period for the purposes of s. 60(1)(b), when the employee does not have a regular work week and where the employee earns wages on a basis other than time (e.g., employees who earn commissions or are paid on a piece rate basis).
Under s. 60(2), the regular wages earned by the employee in the 12-week period preceding the day on which notice of termination was given, are averaged over the weeks worked within the 12-week period. See ESA Part I, s. 1 for a discussion of the term regular wages. This formula is similar to that used for calculating pay in lieu of notice (for employees who do not have a regular work week or who are paid on a basis other than time) where the employee does not receive notice of termination or receives less than the required statutory notice. In ESA Part XV, s. 61(1.1), the wages are averaged over the weeks worked within the 12-week period immediately preceding the date of termination rather than the date notice of termination was given.
It is important to note that s. 60(2) refers to the average amount of regular wages earned in the weeks in which the employee has worked. If the employee has not worked certain weeks during the 12-week period, those weeks are not included in the calculation. For example, if the employee was on a contractual short-term disability leave for one of the 12 weeks prior to being provided with notice, his or her entitlement would be determined by averaging the regular wages earned over the 11 weeks during which he or she worked. Weeks where the employee was on a leave under ESA Part XIV, contractual leave or other approved leave, vacation, or lay-off is considered as weeks not worked.
The question arises, however, as to how to calculate the minimum weekly entitlement for the notice period if the employee did not work any of the weeks within the designated 12-week period because, for instance, the employee was on a contractual short-term disability leave for the entire designated 12-week period. Because s. 60(2) does not provide a mechanism to calculate the average wages in such a situation, Program policy is that the employer must continue to look back in blocks of 12 weeks, until a 12-week period can be found in which the employee has weeks worked and then average the wages earned over that 12-week period.
For example, an employee was on pregnancy and parental leave for 52 weeks and immediately on her return to work was given notice of termination. The employer looks back in 12-week blocks until it finds a 12-week block that contains at least one week worked by the employee. In this case, the employer looks for:
The 12-week block to be used will be the period of time that was 48 through 60 weeks prior to the date notice was given. The employee worked eight weeks during that time, so her regular wages for a regular work week will be the average of her regular wages over those eight weeks.
Section 60(3) deems the benefit plan contributions that the employer should have made during the statutory notice period, pursuant to s. 60(1)(c), to be wages for purposes of s. 103, which permits an order to pay wages to be issued to an employer. See also the discussion in ESA Part XV, s. 62(2) regarding benefit plan contributions where the employer has paid termination pay in lieu of giving notice.
It is important to note that this section does not deem the benefits (as opposed to the contributions) to be wages for purposes of ESA Part XXII, s. 103. As a result, an employment standards officer could not issue an order to pay wages for the value of the benefits that the employee would have received had the employer complied with its obligation to continue the contributions during the required period of notice. However, an employee may have a civil remedy with respect to the value of the lost benefits if the employer fails to make the contributions necessary to maintain the benefits during the notice period. See the discussion of s. 60(4) below.
Section 60(4) clarifies that s. 60(3) does not prohibit an employee from pursuing a civil remedy with respect to any benefits that they may have otherwise been entitled to under a benefit plan that would have been continued during a period of notice under ESA Part XV, s. 57 or s. 58. See also the discussion at ESA Part XV, s. 62(3) regarding benefit plan contributions where the employer has paid termination pay in lieu of giving notice.
For example, an employee's entitlement to a benefit under a plan may be lost because the employer failed to make the contributions necessary to maintain the benefit plans during the notice period. In this situation, s. 60(3) only provides a remedy for the employer's unpaid contributions as wages. It does not provide a remedy to recover the value of the benefits the employee might have been entitled to under a benefit plan that was discontinued contrary to s. 60(1). Section 60(4) makes it clear that the remedy under s. 60(3) does not in any way restrict an employee's right to seek a remedy elsewhere with respect to the value of the lost benefits.
This section specifically permits an employer to pay termination pay in lieu of the notice the employee would have been entitled to receive under ESA Part XV, s. 57 or s. 58.
An employer may terminate an employee's employment under this section if the employer:
As noted in the discussion at ESA Part XV, s. 60(1)(b), an employee who is given notice of termination while on sick or other leave, is entitled to be paid their regular wages during the notice period if the contract of employment is not frustrated or impossible of performance and the employee is not otherwise exempt. This same principle applies to employees who are terminated instead with termination pay under s. 61 as this section requires the calculation to be based on the amount the employee would have received had the employee been given notice in accordance with s. 60.
Where the employer does not give the employee the full notice of termination required under ESA Part XV, s. 57, and continues the employee's regular wages during that partial notice, it is Program policy that such payments reduce the employer's obligations with respect to the pay in lieu owing under s. 61. For example, consider the situation where the employee is entitled to eight weeks' notice of termination under s. 57. The employer provides them with four weeks' notice of termination and continues his or her regular wages during the four weeks. It is the Program's position that the employee is entitled only to an additional four weeks' pay in lieu rather than a full eight weeks.
Sometimes situations will arise in which the employee is terminated without statutory notice, and then the next day obtains new employment at the same or better pay than they received before. Employers will sometimes argue in such a situation that the employee should not receive pay in lieu of notice under s. 61 because the termination did not put the employee "out of pocket". The answer to this is that the legislation does not permit the employer to reduce the pay in lieu obligation under s. 61 by any earnings that the employee is able to earn from a new employer. The termination pay is not compensation for damages and therefore not subject to mitigation. It is a fixed payment that must be made where the employer does not give notice in accordance with ESA Part XV, s. 57. See for example, McDonnell Douglas Canada Ltd. v Topham (April 22, 1993), ES 93-74 (Randall), a case under the former Employment Standards Act. This also applies where the employee has been terminated with pay in lieu of notice but is hired back by the employer at some point during what would have been the statutory notice period. Once the employment relationship is terminated, crystallizing the termination pay entitlement, the employer may not reduce the termination pay by any subsequent earnings.
The question may arise as to whether a Cost of Living Allowance ("COLA") should be included in the termination pay. In Falconbridge Nickel Mines Limited v Sudbury Mine, Mill and Smelter Workers' Union, Local 598 (July 13, 1981), ESC 1021 (Egan), a decision under the former Employment Standards Act, the referee held that the calculation of the regular non-overtime rate for purposes of s. 57(14) of the former Employment Standards Act should not include the COLA component on the basis that the collective agreement only provided for the COLA increase to be added to the straight time rate when the employee was actually working (as opposed to when they were entitled to pay under the collective agreement but not actually working, e.g., jury duty). However, the Divisional Court in an unreported decision and the Court of Appeal in Re Falconbridge Nickel Mines Ltd. and Egan et al., 1983 CanLII 1931 (ON CA) held the contrary. Thus it is Program policy that the regular rate for the purposes of determining the entitlement to termination pay under s. 61(1) (where the employee has not worked through a notice period) should be adjusted upwards to reflect COLA awards just as it would where the employee had been given notice of termination in accordance with ESA Part XV, s. 57.
Vacation pay is to be paid on an employee's termination pay. In this regard, see Inco Ltd. v. U.S. W.A., a case under the former Employment Standards Act. For example, an employee whose vacation pay entitlement is four per cent and is entitled to $1,000 pay in termination pay would be entitled to a further amount of $40 as vacation pay. If the employee's contract of employment provides for vacation pay to be calculated at a greater rate, e.g., eight per cent, then the vacation pay should be calculated accordingly. If the employer provides, however, a greater amount of termination pay than required under this section vacation pay will only be payable on the statutory portion of the termination pay paid in lieu of notice.
Subsection 61(1) provides for payment of termination pay in a lump sum where an employer terminates the employment of an employee without giving notice or giving less notice than is required under ESA Part XV, ss. 57 or 58. Section 61(1.1) sets out a method for calculating termination pay where the employee does not have a regular work week or is paid on a basis other than time. A similar formula is set out in ESA Part XV, s. 60(2) for calculating the entitlement to pay during the notice period for such employees where notice has been given in accordance with s. 57 or s. 58. However, s. 61(1.1) averages the earnings over the weeks worked in the 12 weeks immediately preceding the date the employee is terminated whereas in s. 60(2) the averaging is done over the 12-week period preceding the date the notice was given. See ESA Part XV, s. 60(2) for the complete discussion.
The question may arise as to how to calculate the termination pay entitlement if the employee did not work any of the weeks within the 12-week period preceding the termination date. For example, where the employer decides to terminate the employment of an employee who has been off sick or on a leave of absence for 12 weeks or more, the formula set out in this section would, on its face, result in a termination pay entitlement of $0. However, the Program's position is that such a result is in implicit conflict with the requirement that an employee whose employment is terminated without notice must be given termination pay. It is therefore Program policy that the employer must continue to look back in blocks of 12 weeks, until a 12-week period can be found in which the employee has weeks worked and then average the wages earned over that 12-week period. See also the discussion at ESA Part XV, s. 60.
61(2) An employer who terminates the employment of employees under this section and would otherwise be required to provide notices of termination under section 58 shall comply with clause 58(2)(a).
Section 61(2) provides that an employer who pays termination pay rather than giving notice in a mass termination context, is required to provide the Form 1 to the Director of Employment Standards, although the employer is not required to post the Form 1 as per ESA Part XV, s. 58(2)(b).
Section 62(1) deems the employee to be actively employed during the period of notice under ESA Part XV, s. 57 or s. 58 that should have been, but was not given by the employer, for purposes of entitlement to benefits. This is because some group insurance policies require that the employee be actively employed in order to have coverage under the policy. In the event the insurer denied benefits to an employee on the basis that they were not actively employed, even though s. 62(1) would deem them to be actively employed, the employee's remedy, if any, would be a civil one.
Section 62(2) deems the benefit plan contributions that the employer should have made pursuant to ESA Part XV, s. 61(1)(b) to be wages for purposes of ESA Part XXII, s. 103, which permits employment standards officers to issue orders to pay wages against employers. Therefore, an order to pay may be issued in regard to such contributions. Note that such contributions are deemed wages for the purposes of s. 103 only. They are accordingly deemed to be wages for the purposes of recovery of such monies by way of an order to pay but not for any other purpose, including ESA Part XI, s. 35.2 so they will not attract vacation pay. See also the discussion at ESA Part XV, s. 60 regarding benefit plan contributions where the employer has given notice of termination.
It is important to note that this section does not deem the benefits (as opposed to the contributions) to be wages for purposes of s. 103. Therefore, an officer cannot issue an order to pay wages for the value of the benefits that the employee would have received had the employer complied with its obligation to continue the contributions during the required period of notice. However, an employee may have a civil remedy with respect to the value of the lost benefits if the employer fails to make the contributions necessary to maintain the benefits during what would have been the statutory notice period. See the discussion of s. 62(3) below.
Section 62(3) clarifies that s. 62(2) does not prohibit an employee from pursuing a civil remedy with respect to any benefits that they may have otherwise been entitled to under a benefit plan that would have been continued during what would otherwise been a period of notice under ESA Part XV, s. 57 or s. 58. See also the discussion at ESA Part XV, s. 60 regarding benefit plan contributions where the employer has given notice of termination.
For example, an employee's entitlement to a benefit under a plan may be lost because the employer failed to make the contributions necessary to maintain the benefit plans during what would otherwise have been the statutory notice period. In this situation, s. 62(2) only provides a remedy for the employer's unpaid contributions as wages. It does not provide a remedy to recover the value of the benefits the employee might have been entitled to under a benefit plan that was discontinued contrary to ESA Part XV, s. 61(1)(b). Section 62(3) makes it clear that the remedy under s. 62(2) does not in any way restrict an employee's right to seek a remedy elsewhere with respect to the value of the lost benefits.
This section defines when a "severance of employment" has occurred for the purpose of an employee’s entitlement to severance pay. For purposes of determining whether there is an entitlement to notice of termination or termination pay, see ESA Part XV, s. 56, which defines what constitutes a termination of employment.
The definition in this section is exhaustive. Only situations that are specifically described in the definition will be considered to constitute a severing of the employment relationship. Those situations are as follows:
Section 63(1)(a) provides that a severance occurs when an employer dismisses or refuses to continue or is unable to continue employing an employee. The term "dismisses" essentially refers to what is commonly known as a "firing". For a detailed discussion of dismisses refer to ESA Part XV, s. 56(1).
This part of the definition also includes the situation where the employer refuses or is unable to continue employing the employee. This phrase captures some situations that would not technically qualify as a dismissal or firing, such as where the employer does not continue the employment of an employee who was on a term contract once the term expires.
The question sometimes arises as to whether an employee is entitled to severance pay where the employee first gives notice of resignation and then the employer terminates the employee prior to the date when the employee would have resigned. For example, the employee gives notice to the employer on March 1 that the employee will resign on May 1. On March 15, the employer tells the employee that the employment relationship is over, effective that day. A literal reading of the legislation might suggest that the employee is entitled to severance pay on the basis that the employer severed the employment of the employee and that the employee's resignation never became effective. However, if the legislation is interpreted purposively, the opposite conclusion should be reached. As the employee would have resigned in any event, it was the employee, not the employer, who precipitated the ending of the employment relationship. Accordingly, the employee is not entitled to severance pay. This is supported by Canada Trust Realty Inc. v Employee (March 12, 1992), ESC 3013 (Novick), a decision under the former Employment Standards Act.
Section 63(1)(b) is identical in meaning to s. 56(1)(b), the corresponding section in the termination of employment provisions. Constructive dismissal exists where an employee in fact resigns, but in law is treated as if they were dismissed by the employer. Constructive dismissal can arise from a number of situations, including forced resignation (e.g., where the employer says, "Quit or else I'll fire you"), harassment and abuse, failure to meet payroll, and where the employer unilaterally and substantially changes a fundamental or essential term or condition of an employee's employment without the consent of the employee.
In order for a constructive dismissal to be considered a severance, the employee must resign in response to the constructive dismissal within a reasonable period.
Refer to ESA Part XV, s. 56(1) for a detailed discussion of constructive dismissal.
For information specific to what is a “reasonable period” in the context of a constructive dismissal resulting from an employer continuing a temporary reduction or temporary elimination in hours of work or wages for reasons related to COVID-19 past the end of the COVID-19 period, see the discussion at section 7 of O. Reg. 228/20.
Section 63(1)(c) applies if the employee is on a lay-off that equals or exceeds 35 weeks in any period of 52 consecutive weeks. A "week of lay-off is defined in s. 63(2) – refer to the discussion below for a detailed discussion of that term. Note that if the lay-off is as a result of a permanent discontinuance of all of the employer's business at an establishment, then s. 63(1)(d) will apply, rather than s. 63(1)(c). Refer to the discussion of s. 63(1)(d) below.
The 35 weeks of lay-off need not be consecutive, although they must all occur within a period of 52 consecutive weeks. For example, if the employee is laid off for 20 weeks, returns to work for 17 weeks, and then is laid off again for a further 15 weeks, the employee's employment will be deemed to be severed under s. 63(1)(c) because the employee was laid off for a total of 35 weeks in a period of 52 consecutive weeks.
The 52-week period is a "rolling window". However, neither the employer nor the employee can pick and choose which 52 weeks to use when determining whether the 35-week threshold has been reached. Rather, the threshold is reached and the employment is severed on the first occasion of there being 35 weeks of lay-off in a 52-week period. Consider the following case:
The employee had first been laid off for a total of 35 weeks in a 52-week period as of October 9, 2016. The employee had also been laid off for a total of 35 weeks in the 52-week period ending June 24, 2017.
If the employee had filed a claim in November of 2017, on the basis that the severance pay became due following the severance of their employment on October 9, 2016, the employer could not defeat the employee's claim as being premature by choosing to have the 52-week period run from June 26, 2016, such that the employee had not yet been laid off for a total of 35 weeks within the 52-week period that started running on that date.
It should be noted that in Hagt v E.S. Fox Limited (October 20, 1997), 3833-96-ES (ON LRB), a decision under the former Employment Standards Act, the Ontario Labour Relations Board ruled that an employee could choose which 52-week period to base his claim on. There, the employee had been subjected to a series of lay-offs and recalls and, similar to the case of the employee in the hypothetical example above, there were two 52-week periods in which the total number of weeks of lay-off exceeded 35, one of which (the earlier) would make his claim out-of-time and the other of which would put his claim within the limitation period.
The Board's decision was overturned by a 2-1 majority in an unreported decision of the Divisional Court, with the dissenting judge agreeing with his colleagues that the decision was incorrect but asserting that it should nevertheless be upheld because it was not unreasonable. The Court of Appeal in E.S. Fox Limited v Hagt, 2000 CanLII 26962 (ON CA) reversed the Divisional Court, declaring that it agreed with the dissenting judge in the court below that the decision was not unreasonable. In light of the precise grounds offered by the dissenting Divisional Court judge and the Court of Appeal, the Program is of the view that it is not bound to follow Hagt v E.S. Fox Limited, and since the Program is of the view that there are no compelling policy reasons to hold that an employee or an employer can choose which 52-week period to use, Program policy was and remains that an employee becomes entitled to severance pay at the first point at which there have been a total of 35 weeks of lay-off in a 52-week period.
Because a severance occurs when the employer lays the employee off for 35 weeks or more in any period of 52 consecutive weeks, there is no basis to exclude any weeks of lay-off just because they may have occurred prior to an employee accepting a recall.
See for example, the Court of Appeal decision in United Steel v National Steel Car Limited, 2013 ONCA 401 (CanLII). In that case, an employee was laid off in May of 2008. In January 2009, once the lay-off had gone on for 35 weeks, it was deemed to have become a severance of employment. At that point, the employee elected to retain his recall rights.
The lay-off continued until March 16, 2010, 22 months after the layoff began, when the employee accepted a recall. He was laid off again on April 19, 2010 after only five weeks of work and a few days later he renounced his recall rights and asked for his severance pay. At that point in time, the total time spent by the employee on lay-off in the preceding 52 weeks was in excess of 35 weeks.
The employer refused to pay the employee. The employee grieved, and the matter went before an arbitrator who held that the employee had no entitlement. In the arbitrator’s view, it was implicit in the Act’s recall rights provisions that an employee who had initially elected to retain his recall rights and who later accepted a recall could not have any of the time spent on lay-off prior to the recall taken into account in determining whether there was a subsequent severance.. Under this approach, which disregards the word "any" in s. 63(1)(c), the employee would have had to have spent another 35 weeks on lay-off after the recall in order to be entitled to severance pay.
On judicial review of the arbitrator’s decision, a majority of the Divisional Court in United Steel v National Steel Car Limited, [2012] ONSC 1941 (October 31, 2012) upheld the arbitrator’s decision; however, that Court’s decision was overturned at the Court of Appeal. The Court of Appeal, in adopting the judgment of the dissenting Divisional Court judge, ruled that the recall rights provisions have no bearing on what constitutes a severance within the meaning of s. 63 (or on what constitutes a termination within the meaning of s. 56), and that there is no basis to exclude any weeks of lay-off when determining whether a subsequent severance (or termination) occurred just because they may have occurred prior to an employee accepting a recall.
Section 63(1)(d) provides that an employee's employment is severed where the employer lays off the employee due to a permanent discontinuance of all of the employer's business at an establishment. Where this provision applies, the employee’s employment is deemed to be severed at the moment the lay-off begins.
For s. 63(1)(d) to apply, the employee must be laid off because of a "permanent discontinuance" of all of the employer's business at an establishment. There is a discussion of the phrase permanent discontinuance in O Reg 288/01, s. 3(4) in the context of the 10 per cent rule and mass notice of termination. The same principles apply, except that the employer's intention with respect to the issue of whether there is a permanent discontinuance may not be as significant in the context of a severance as it is in a mass termination, where the employer is required to give advance notice of the event. In addition, there have been some referee and court decisions on what constitutes a permanent discontinuance for purposes of severance pay. In Agincourt Motor Hotel Limited v Flannigan et al (August 19, 1982), ESC 1272 (Davis), a decision under the former Employment Standards Act, the referee held (who was upheld by the court on judicial review) that a sale of a business constitutes a permanent discontinuance of the business of the vendor employer for purposes of s. 58 of the former Employment Standards Act. On the other hand, a contracting out of business previously done "in-house" by an employer (which is generally not considered to be a sale under s. 9 of the Act) will not constitute a permanent discontinuance in that it is open to the employer, at the end of the contract, not to renew it and to have the operations revert back to the employer. In this regard, see Otis Elevator Company Limited v United Steelworkers of America et al (November 5, 1985), ESC 1978 (Davis), a decision under the former Employment Standards Act.
For s. 63(1)(d) to apply, the permanent discontinuance must be of all of the employer’s business at an "establishment". Establishment is defined in ESA Part I, s. 1 as follows:
An establishment is therefore a location where an employer carries on business. If the employer has more than one location in the same municipality, or a number of locations where seniority rights extend, then these locations will together constitute an establishment.
For example, the employer has three plants in the same municipality. The three plants comprise one establishment. The employer lays off some employees because it is closing down two of those plants. The lay-off will not constitute a severance under s. 63(1)(d), because the employer is not discontinuing all of its business at the establishment. Note, however, that the lay-off may still constitute a severance under s. 63(1)(c) if it equals or exceeds 35 weeks in a 52 consecutive week period. For a detailed discussion of the definition of establishment please see ESA Part I, s. 1.
Section 63(1)(e) provides that where an employee provides at least two weeks' written notice of resignation after having received notice of termination and the resignation is to take effect during the statutory notice period, this constitutes a severance of the employee’s employment. This provision allows employees who have been notified that their employment will end to end the employment relationship earlier than the employer intended without having to forfeit their severance pay entitlement.
The employee must satisfy two requirements in order to avoid forfeiting the right to:
Statutory notice period is defined in ESA Part I, s. 1 as follows:
"Statutory notice period" means,
Refer to ESA Part I, s.1 for a detailed discussion of "statutory notice period".
Section 63(1)(e) must be read in conjunction with s. 63(3), which deems the employee’s employment to be severed on the day the employer's notice of termination would have taken effect had the resignation not occurred.
In this example, the employee is entitled under the Act to eight weeks' notice, so the statutory notice period is the last eight weeks of the 12-week notice period given by the employer. The employee gave two weeks' notice of resignation to the employer and that notice took effect during the statutory notice period. Therefore, this constitutes a severance of employment under s. 63(1)(e).
Since s. 63(3) deems the employee's employment to be severed on the day the employer's notice of termination would have taken effect had the resignation not occurred, in our example, that date, for the dual purpose of determining whether the employee has met the five-year eligibility threshold for severance pay, and for determining the date the employee’s entitlement to severance pay arose, is March 26.
Note that s. 65(3) provides that the period between the day the employee's resignation took effect and the day the employee's notice of termination would have taken effect is not included for the purpose of calculating the amount of severance pay. Refer to ESA Part XV, s. 65 for further discussion.
Section 63(1)(e) says that a severance occurs where the employer gives the employee notice of termination "in accordance with s. 57 or s. 58." One question that arises is whether s. 63(1)(e) can apply, thereby allowing an employee who has been notified that their employment will end to resign without forfeiting a severance pay entitlement where the employer has not given the required amount of notice under s. 57 or s. 58. It is Program policy that if the notice given by the employer under s. 57 or s. 58 is deficient, this will not preclude an employee from preserving their entitlement to severance pay so long as they provide at least two weeks’ written notice, which is to take effect during that period of statutory notice given by the employer. For example, if the employee was entitled to eight weeks’ notice under s. 57 but was given only four weeks' working notice, the employee would be able to retain the right to severance pay by providing two weeks' notice of resignation. To take the opposite view would result in employees being penalized (because they could not resign and retain their severance pay entitlement) because their employer failed to comply with the Act.
Section 63(2) defines "excluded week" as a week during which the employee did not work for one or more days because the employee is not able or available to work, is subject to disciplinary suspension or is not provided with work because of a strike or lock-out occurring at their place of employment or elsewhere. See the discussion of these circumstances in s. 63(2.1) below.
Sections 63(2.1) to 63(2.4) define a "week of lay-off", but only for the purposes of s. 63(1) (i.e., for the purposes of determining whether the employee’s employment has been severed). This means that a week of lay-off may be defined differently for other parts of the Act. Specifically, a week of lay-off is defined differently in s. 56(3) to s. 56(3.6) for the purposes of notice of termination.
Section 63(2.1) provides that a week of lay-off where an employee has a regular work week is a week in which the employee receives less than 25 per cent of the wages they would earn at their regular rate in a regular work week. However, a week of lay-off will not include an excluded week as defined in s. 63(2).
This definition is similar to the definition of week of lay-off in s. 56(3.1) for employees with a regular work week in the notice of termination context, except that the notice of termination definition is based on a threshold of "less than one-half" of what the employee would earn in a regular work week at his or her regular rate.
Section 63(2.1) refers to "regular rate" and "regular work week", which are defined terms in s. 1 as follows:
Refer to ESA Part I, s. 1 for a detailed discussion of these terms.
For an employee who has a regular work week, a week of lay-off is a week in which they receive less than 25 per cent of the wages they would earn at their regular rate for a regular work week, unless the week is one in which any of the following four circumstances are present:
An employee who, for example, is unable to work because of sickness or an injury will not be considered to be on a week of lay-off.
An employee who, for example, is unavailable for work because they were exercising a right to a statutory leave or on jury duty will not be considered to be on a week of lay-off.
Where an employee on a lay-off has found work with another employer during the lay-off, the employee is not considered not available to work (i.e., they are considered to be available for work with the employer that laid them off, so that time is considered to be weeks of lay-off). This is so whether the new employment is of a temporary or a permanent nature. This is also so with respect to the reasonable period of time an employee takes to return to work after being recalled. The employee would be considered "not available to work" only if the employee is unwilling to return to work for the employer who laid them off within a reasonable time.
An employee who is on disciplinary suspension is not on a week of lay-off. It is important to ensure, though, that the disciplinary suspension is bona fide and is pursuant to established company rules and procedures or a contract of employment.
Where the employee is not provided with work by the employer due to a strike or lock-out at the employee's place of employment, or elsewhere, the employee is not on a week of lay-off.
It is important to emphasize that the strike or lock-out need not be at the employee’s place of employment. For example, if there is a strike or lock-out at a supplier, then the manufacturer that depends upon the supplier for its parts may be forced to close down until the strike or lock-out is over or a new supplier can be found. In this case the employees of the manufacturer are deemed not to be on a lay-off during the temporary closure that occurs as a result.
It is the Program's position that in order to characterize a week of lockout as an excluded week, the lock-out by the employer must be a legal one under the Labour Relations Act, 1995, SO 1995, c 1, Sch A ("LRA 1995"). In those circumstances, the employer's failure to provide work flows from the right to lock out the employees under the LRA 1995 and the employer should not suffer any adverse consequences under the ESA for exercising that right.
On the other hand, if the lock-out is illegal, the failure to provide work is not permissible under LRA 1995. As a consequence, the Program's position is that a week in which employees are illegally locked out is a week of lay-off. However, a week of strike, whether illegal or legal, will be considered by the Program to be an excluded week (i.e., not a week of lay-off) because the employer does not in those circumstances have any control over whether work is provided.
This subsection provides that an "excluded week" is included in counting the period of 52 weeks referred to in s. 63(1)(c).
Where employees who do not have regular work weeks, for the purposes of the rule in s. 63(1)(c) that deems an employee’s employment to have been severed if they are laid off for 35 weeks or more in any period of 52 consecutive weeks, s. 63(2.3) provides that a week of lay-off is a week in which the employee earns less than one-quarter the average weekly wages that they earned in the 12-week period preceding the commencement of the 52-week period.
Clause 63(2.4)(b) provides that if the 12-week period contains an excluded week, the average amount earned is to be calculated based on the earnings in weeks that were not excluded weeks divided by the number of weeks that were not excluded weeks.
Clause 63(2.4)(a) provides that excluded weeks are not counted as weeks of lay-off for the purposes of determining whether an employee who does not have a regular work week has been laid off for 35 or more weeks under s. 63(1)(c) and s. 63(2.3). However, excluded weeks do count as part of the 52-week period.
Section 63(3) provides that where an employee's employment is severed under s. 63(1)(e) (i.e., an employee who has been given notice of termination in accordance with s. 57 or s. 58 has resigned by giving two weeks' written notice that will take effect within the statutory notice period), the employee’s employment shall be deemed to be severed on the day that the employer’s notice of termination would have taken effect had the employee not resigned. This is relevant for determining whether the employee has met the five-year eligibility threshold for severance pay. Section 63(3) must be read together with s. 65(3), which provides that the period between the date the employee's resignation took effect and the date the employer's notice of termination would have taken effect is not included in the calculation of the amount of the employee's severance pay.
In this example, the employee has resigned within the statutory notice period in accordance with s. 63(1)(e), so the resignation is considered to be a severance of the employment relationship under s. 63(1). The date the employee's employment is deemed to be severed for the purpose of determining whether the employee has met the five-year eligibility threshold for severance pay, and also for determining the date the employee's entitlement to severance pay arose is March 28, not February 11.
This section sets out the requirements that must be met for an employee to qualify for severance pay. An employee who is not otherwise exempt from the severance provisions of the ESA 2000 qualifies for severance pay when their employment is severed and they:
The requirements are discussed below.
An employee must have been employed for at least five years at the time of the severance. It should be noted that only employment in Ontario (or work outside of Ontario that is a continuation of work in Ontario) is considered in determining eligibility for and the calculation of severance pay. For example, if an employee works for ABC Inc. in England for five years and then is transferred to Ontario and has their employment severed two years later, the employee will be considered to have only two years of employment for the purposes of the ESA 2000, including the severance provisions.
Time that will be included in the calculation of the five-year qualifying period is set out in ESA Part XV, s. 65(2) as follows:
Under s. 65(2), all periods of employment (whether active or inactive) are added together for the purposes of determining both eligibility for and the amount of severance pay to which the employee is entitled. Examples of periods of inactive employment that must be included are time spent on layoff, vacation, and leave of absences such as educational, or any leave under Part XIV. However, it is Program policy that time spent on lay-off after the lay-off becomes a severance under ESA Part XV, s. 63(1)(c) (i.e., it equals or exceeds 35 weeks in a period of 52 consecutive weeks) and the time subsequently spent waiting for a recall to work is not counted as employment for the purposes of either eligibility for severance under s. 64(1) or the calculation of the amount of severance pay in s. 65(1).
Multiple periods of employment with the same employer must be added together for the purposes of both eligibility for, and the calculation of, severance pay, regardless of the amount of time between the periods of employment or the reason any of the periods of employment came to an end (e.g., whether the employment ended at the employer's behest or the employee resigned). For a detailed discussion of the time included in determining eligibility for, and the calculation of, severance pay see ESA Part XV, s. 65.
Where an employee's employment is severed under ESA Part XV, s. 63(1)(e) and the employer gives notice of termination and the employee provides two weeks' written notice of resignation that takes effect in the statutory notice period, the date of severance is deemed under ESA Part XV, s. 63(3) to be the date the employer's notice would have taken effect. Therefore, when determining the length of employment for the purposes of the five-year qualifying period, the period of time between the date of resignation and the date the employer's notice would have taken effect (the deemed severance date) is included. However, when it comes to calculating the amount of severance pay, ESA Part XV, s. 65(3) provides that the period between the date the resignation takes effect and the date the termination would have taken effect is not to be used.
Where an employee's employment is severed without the required written notice under ESA Part XV, s. 57 or s. 58, ESA Part XV, s. 65(4) specifically requires that the period of notice that should have been provided be included in calculating the amount of severance pay. It is Program policy that this period must also be included for the purpose of determining whether the five-year threshold for eligibility for severance pay has been met; otherwise, the employee's severance pay entitlement would be calculated as zero, which would be contrary to the direction in s. 65(4) that it be calculated as if the employee had continued to be employed for the period of notice that should have been given.
Where an employee has five or more years of employment with the employer at the time the severance occurred and either of the two requirements set out in s. 64(1)(a) or (b) is met, the employee will be entitled to severance pay.
If the employment of an employee who has been employed for five years or more is severed by an employer with a global payroll of $2.5 million or more, the employee will be entitled to severance pay. The $2.5 million dollar payroll test in s. 64(1)(b) is the condition that triggers most severance pay entitlements and is therefore considered first. If this condition is met there is no need to consider the test in s. 64(1)(a). (Note that it was long-standing Program policy that the $2.5 million threshold was based solely on an employer’s payroll in Ontario. The Ontario Superior Court considered this position in the decision of Hawkes v. Max Aicher (North America) Limited, 2021 ONSC 4290, and found that it was unreasonable. The Program consequently changed its policy and the $2.5 million threshold is now based on the employer’s global payroll.)
Section 64(2) defines payroll as follows:
See the detailed discussion of the definition of payroll
below.
If an employer does not have a global payroll of at least $2.5 million, an employee will still be entitled to severance pay if the employment of 50 or more employees is severed within a six-month period because of a permanent discontinuance of all or part of the employer's business at an establishment.
Prior to 1987, when the severance pay provisions in the former Employment Standards Act were amended to extend severance pay to employees of employers with a $2.5 million payroll or more, employees had to satisfy substantially the same test as is set out in s. 64(1)(a). As a result, most of the cases involving this test arose prior to 1987, especially since, due to wage increases over the years, many employers severing the employment of 50 or more employees in a six-month period will satisfy the payroll test. However, there may be some instances in which an employer who does not meet the payroll threshold will sever the employment of 50 or more employees in a six-month period.
Some of the issues regarding this test in the pre-1987 cases under the former Employment Standards Act may still be relevant today. For example, there is the issue of whether or not the six-month period has to be immediately prior to the permanent discontinuance or whether it can be any six-month period as long as the severances are caused by the discontinuance. The Program policy on this issue is that the six-month period need not be immediately prior to the permanent discontinuance, and that any six-month period can be used as long as the severances were caused by the permanent discontinuance.
Another issue regarding this test is the count issue, i.e., did 50 or more employees have their employment severed? The question here is whether or not exempt employees should be included even though they themselves are not entitled to severance pay.
In Dominion Stores Ltd. v. Butcher et al (ON SC), a decision under the former Employment Standards Act, the Divisional Court upheld a decision that these employees should be included in the count. This case upheld as reasonable the referee's decision in Dominion Stores Ltd. v Butcher et al (February 17, 1987), ESC 2215 (Brown) that stated that exempt, elect-to-work employees should be included in the count for purposes of severance pay. There is, however, another Divisional Court decision that upheld as reasonable a referee's decision that said the exact opposite, United Steelworkers of America, Local 14097 v. Franks (Div. Ct.), 1990 CanLII 6666 (ON SC), a decision under the former Employment Standards Act. This decision was appealed to the Ontario Court of Appeal, which held in United Steelworkers of America, Local 14097 v Franks, 1994 CanLII 8708 (ON CA) that the proper standard of review of referees' decisions was reasonableness, rather than the stricter correctness test, and therefore declined to comment on whether or not the referee was correct in law. Thus, the Court of Appeal's decision did not necessitate a change to the Program policy that exempt employees are to be included in the count for purposes of s. 64(1)(a).
A further issue concerning the determination of the count is whether or not employees should be included in the count if they are employees who, having been given notice of termination by the employer, resign before that notice of termination becomes effective. For example, the employees are given, on March 1, eight weeks' notice of termination to be effective on April 25. One of those employees, having found other employment, gives two weeks' notice and resigns on March 15, in accordance with ESA Part XV, s. 63(1)(e). Should that employee be included in the count for purposes of determining whether or not the threshold of 50 severances in s. 64(1)(a) has been met? An examination of s. 64(1)(a), read in conjunction with s. 63(1)(e), would indicate that such an employee must be included. It is the number of employees whose employment is severed by an employer that must be included in the count under s. 64(1)(a) and the employment of an employee who resigns in the above manner is considered to have been severed by their employer under s. 63(1)(e). In contrast, an employee who resigns and does not meet the requirements of s. 63(1)(e) would not be included in the count.
Other issues regarding s. 64(1)(a) involve what constitutes a permanent discontinuance and also what constitutes "part of the business of the employer". For a detailed discussion of those terms refer O Reg 288/01, s. 3(4) in the context of the 10 per cent rule and mass notice of termination. The same principles apply, except that the employer's intention with respect to the issue of whether there is a permanent discontinuance may not be as significant in the context of a severance as it is in the context of a mass termination, where the employer is required to give advance notice of the event. In addition, there have been some referee and court decisions on what constitutes a permanent discontinuance for purposes of severance pay.
In Agincourt Motor Hotel Limited v Flannigan et al (August 19, 1982), ESC 1272 (Davis), a decision under the former Employment Standards Act, the referee held (who was upheld by the court on judicial review) that a sale of a business constitutes a permanent discontinuance of the business of the vendor employer for purposes of s. 58 of the former Employment Standards Act. On the other hand, a contracting out of business previously done "in-house" by an employer, which is generally not considered to be a sale under ESA Part IV, s. 9, will not constitute a permanent discontinuance in that it is open to the employer, at the end of the contract, not to renew it and to have the operations revert back to the employer. In this regard, see Otis Elevator Company Limited v United Steelworkers of America et al (November 5, 1985), ESC 1978 (Davis), a decision under the former Employment Standards Act.
The definition of payroll is used to determine whether an employer meets the $2.5 million payroll threshold set out in s. 64(1)(b). The employer is considered to meet the threshold if either the calculation in s. 64(2)(a) or (b) produces a sum of $2.5 million or more.
Where associated or related businesses can be treated as one employer under ESA Part III, s. 4, the payrolls of each individual business are added together to determine whether the $2.5 million payroll threshold is met. This applies whether or not the section 4 associated or related businesses fall within Ontario jurisdiction.
al Distribution Network Canada Ltd., 2018 CanLII 107738 (ON LRB).)
The definition of payroll requires an examination of the wages earned by employees during three distinct periods preceding a severance. The three periods are:
The employer is considered to have a payroll of $2.5 million or more if the calculation for any one of these three periods results in an amount of $2.5 million or more.
For example, an employer might have had a $2.5 million payroll in the second-last completed fiscal year preceding a severance. Despite the fact that the payroll for the last completed fiscal year is less than $2.5 million, the employer would meet the $2.5 million payroll threshold in s. 64.
Similarly, an employer may not have had a $2.5 million payroll in the last or second last fiscal year, but if the projected payroll for the current year based on the calculation in s. 64(2)(a) exceeds $2.5 million the employer would meet the $2.5 million payroll threshold.
Wages are defined in ESA Part I, s. 1:
This section provides that prescribed employees are not entitled to severance pay under s. 64. The prescribed employees are identified in O. Reg. 288/01, s. 9. Refer to O. Reg. 288/01 for a complete discussion of the prescribed employees.
As with all exemptions from a minimum standard, the onus is on the employer to establish on a balance of probabilities that the exemption applies.
Section 64(4) applies where the employer has a global payroll of less than $2.5 million and so what is at issue is whether or not the employer has severed the employment of 50 or more employees in six months or less because of a permanent discontinuance of all or part of the business of an employer at the establishment.
ESA Part I, s. 1 defines an establishment as a single location or in certain circumstances two or more locations. Despite this definition, s. 64(4) deems a single location that is part of an establishment under the s. 1 definition to be an establishment for the purpose of determining whether an employer is liable to pay severance pay under s. 64(1)(a).
This section addresses a situation where, for example, the employer has two or more locations in the same municipality, and hence together they comprise one establishment as that term is defined in ESA Part I, s. 1. If the employer moves all or part of its production from location A to location B, there is a permanent discontinuance at location A, but, applying the s. 1 definition, there is no such discontinuance at the establishment as a whole. In this situation, s. 64(4) deems location A to be a separate establishment for the purposes of severance pay if the employment of 50 or more employees is severed in six months or less because of the permanent discontinuance at location A.
This section determines the amount of severance pay to which a qualified employee is entitled. It provides that an employee will be entitled to an amount equal to the employee's regular wages for a regular work week multiplied by the sum of the employee's completed years, and completed months not included in a completed year divided by 12. However, this section must be read in conjunction with s. 65(5), which sets out a maximum amount of severance pay an employee is entitled to under s. 65(1). It caps the entitlement at an amount equal to the employee's regular wages for a regular work week for 26 weeks.
For example, if the employee has 10 years, and 6 ¾ months of employment and the employee's regular wages for a regular work week is $1,000, the employee's severance pay will be $10,500. The calculation is as follows:
Regular wages and regular work week are defined in ESA Part I, s. 1 as follows:
Also see ESA Part XV, s. 60(1)(b) for a discussion of Program policy regarding the interpretation of the phrase "regular wages for a regular work week" when there have been changes to an employee's pay and/or hours of work shortly before the employment relationship is terminated. This policy also applies to the calculation of severance pay.
Section 65(6) sets out how to determine "the employee's regular wages for a regular work week" for employees who do not have a regular work week or are paid on a basis other than time. See s. 65(6) below for a detailed discussion.
The determination of an employee's length of employment for the purposes of calculating the amount of severance pay under s. 65(1) is not necessarily identical to the determination of whether the employee has met the five-year threshold to qualify for a severance entitlement. See the discussion ESA Part XV, s. 64(1) with respect to employment that is considered in determining eligibility for severance pay.
It should be noted that only employment in Ontario (or work outside of Ontario that is a continuation of work in Ontario) is considered in determining eligibility for and the calculation of severance pay. For example, if an employee works for ABC Inc. in England for five years and then is transferred to Ontario and has their employment severed two years later, the employee will be considered to have only two years of employment for the purposes of the Employment Standards Act, 2000, including the severance provisions.
Under s. 65(2), all periods of employment (whether active or inactive) are added together for the purposes of determining both eligibility for and the amount of severance pay to which the employee is entitled. Examples of periods of inactive employment that must be included in these determinations are: time spent on lay-off, vacation and leave of absences such as educational leave and leaves under Part XIV.
However, it is Program policy that time spent on lay-off after the lay-off becomes a severance under ESA Part XV, s. 63(1)(c) (i.e., it equals or exceeds 35 weeks in a period of 52 consecutive weeks) and the time subsequently spent waiting for a recall to work is not counted as employment for the purposes of either eligibility for severance under s. 64(1) or the calculation of the amount of severance pay under s. 65(1).
Multiple periods of employment with the same employer must be added together for the purposes of both eligibility for, and the calculation of the amount of, severance pay, regardless of the amount of time between the periods of employment or the reason any of the periods of employment came to an end (e.g., whether the employee quit or had their employment severed at the employer's behest). See s. 65(2) below for a detailed discussion on the time included in determining eligibility for and the calculation of the amount of severance pay.
Where the employment of an employee is severed under ESA Part XV, s. 63(1)(e) (i.e., the employer provides notice of termination and the employee provides two weeks' written notice of resignation that takes effect in the statutory notice period), the date of severance is deemed under ESA Part XV, s. 63(3) to be the date the employer's notice would have taken effect. Therefore, when determining the length of employment for the purposes of determining eligibility to severance pay (i.e., for purposes of the five-year qualifying period), the period of time between the date of resignation and the date the employer's notice would have taken effect (the deemed severance date) is included.
However, when it comes to calculating the amount of severance pay, s. 65(3) provides that the period between when the resignation takes effect and when the termination would have taken effect is not to be used. See s. 65(3) below for further discussion.
Where an employee's employment is severed without the required written notice under ESA Part XV, ss. 57 or 58, s. 65(4) specifically requires that the period of notice that should have been provided be included in calculating the amount of severance pay. It is Program policy that this period must also be included for the purpose of determining whether the five-year threshold for eligibility for severance pay has been met; otherwise, the employee's severance pay entitlement would be calculated as zero, which would be contrary to the direction in s. 65(4) that it be calculated as if the employee had continued to be employed for the period of notice that should have been given. See s. 65(4) below for a detailed discussion.
One question that arises is how to calculate severance pay for seasonal employees. In Standard Commercial Tobacco Co. of Canada Ltd. v Canadian Union of Operating Engineers and General Workers, [1988] 31 OAC 74 (Ont Div Ct), the Ontario Divisional Court upheld the decision of referee Brown in Standard Commercial Tobacco Co. of Canada Ltd. v Canadian Union of Operating Engineers and General Workers (March 18, 1987), ESC 2225 (Brown), a decision made under the former Employment Standards Act, which considered the situation of seasonal employees in the tobacco industry who were laid off at the end of each season with recall rights under the terms of the collective agreement, and then recalled at the beginning of the next season of work. The employment relationship continued during the period of lay-off. The referee held that in such a situation, the employees' number of years of employment should be determined by including the active seasons as well as the non-active seasons in which the employees were on lay-off. However, the referee went on to say that, in determining what the employees' wages were for a regular non-overtime work week, for purposes of severance pay, the officer should take the number of hours worked by the employee in the year in which they are entitled to severance pay, and then divide that figure by 52 weeks.
For example, if a seasonal employee is entitled to severance pay in 2012 and during that year they worked 1560 hours at $20 an hour, the employee's wages for a regular non-overtime work week would be 1560 divided by 52 = 30 times the hourly rate of $20 which comes to $600. This would be the result according to the Standard case, even though the employee's non-overtime wages while they were working were higher, e.g., $1000 a week. Standard Commercial Tobacco Co. of Canada Ltd. v Canadian Union of Operating Engineers and General Workers thus has the effect of prorating the seasonal employee's actual wages for purposes of severance pay because the employee does not work the entire year.
Although the Divisional Court in upholding the referee's decision did not consider this particular point, the Program has adopted the referee's method of calculating severance pay for seasonal employees in situations that closely match the situation in Standard Commercial Tobacco Co. of Canada Ltd. v Canadian Union of Operating Engineers and General Workers. For example, the workers in the case were employees who had an established seasonal work cycle from year to year and whose employment relationship did not end at the end of each season. Thus the method that effectively prorates the employee's regular wages for a regular work week should be applied in similar situations where the employees have a very specific regular pattern of seasonal work and whose employment relationships are not severed at the end of each season. This method should not be used in situations where the seasonal employees do not have a regular yearly cycle, i.e., where the season varies in length from year to year or whose employment relationships are severed at the end of each season.
It should also be noted that, although it is the policy of the Program that the statutory minimum of four or six per cent for vacation pay as determined in accordance with ESA Part XI, s. 35.2 (or, where there is a greater right or benefit respecting vacation pay, that greater amount) should be levied on the employee's termination pay, it is also the policy of the Program that the employee's severance pay, on the other hand, will not attract vacation pay. For example, if the employee's employment is terminated and severed and the employee is owed $4,000 termination pay and $5,000 severance pay, vacation pay (in this example the statutory entitlement is four per cent) will be levied on the termination pay but not the severance pay, so the total owing will be $9,160. If the employee's contract of employment provides for vacation pay to be calculated at a greater amount than the employee's statutory entitlement under s. 35.2, the amount (paid in respect of termination pay only) will be increased accordingly. For a discussion of the rationale for levying vacation pay on termination pay refer to ESA Part XV, s. 61(1).
This provision defines the time that is to be included in determining an employee's length of employment for the purpose of determining if an employee qualifies for severance and, if they do, the time that is included to determine the amount of severance pay to which the employee is entitled. All time spent in the employer's employ, whether continuous or not, whether active or not, shall be included. It should be noted, however, that only employment in Ontario or work outside of Ontario that is a continuation of work in Ontario is considered in determining eligibility for and the calculation of the amount of severance pay.
For example, if an employee works for ABC Inc. in England for five years and then is transferred to Ontario and has their employment severed two years later, the employee will be considered to have only two years of employment for the purposes of the Act, including eligibility for and the calculation of the amount of severance pay under ESA Part XV, s. 64(1) and s. 65(1). See Singer v Tullett & Tokyo Forex (Canada) Ltd. (July 26, 1996), ESC 96-167 (Novick), a decision under the former Employment Standards Act.
Examples of periods of inactive employment that must be included are time spent on lay-off, vacation and leaves of absence such as educational leave or leaves under Part XIV. The only exception to this is where the lay-off becomes a severance under ESA Part XV, s. 63(1)(c) (i.e., a lay-off that lasts 35 weeks in any period of 52 consecutive weeks) and the employee retains the right to be recalled. The time spent waiting to be recalled beyond the point of the severance will not be counted as employment for purposes of ESA Part XV, s. 64(1) or s. 65(1).
In Brock Telecom (Northern Telecom Canada Limited) and Microtel Limited v Communications and Electrical Workers of Canada Union, Local 526 (August 5, 1991), ESC 2893 (Haefling), a decision under the former Employment Standards Act, the referee held that all of the time spent on layoff with recall rights, even if beyond the 35-week point, should be included in length of employment. However, this case does not represent Program policy and should not be followed, as it would result in the inclusion of time in the calculation of the length of employment that accrued after the employment relationship was explicitly considered to have been severed under the ESA 2000.
Note that the provision that states that a lay-off becomes a severance when the lay-off has lasted 35 weeks in any period of 52 consecutive weeks (the 35 week rule) in ESA Part XV, s. 63(1)(c) only applies to lay-offs that commenced on or after June 15, 1987. The reference to the requirement that the lay-off commence on or after June 15, 1987, appeared in the legislation when it became law in 1987, but was removed when the statute was re-issued in the Revised Statutes of Ontario 1990. The removal of the reference to June 15, 1987, did not mean that the 35 week rule can be applied to lay-offs commencing prior to June 15, 1987, however, since the Statute Revision Commissioners preparing the RSO 1990 did not have the mandate to change the meaning or content of the statute, but only to perform a "clean-up" and renumber the statutes. Likewise, the absence of the reference to lay-offs commencing on or after June 15, 1987, in the Employment Standards Act, 2000 does not mean that the 35 week rule can be applied retroactively. Therefore, if a lay-off commenced prior to June 15,1987, the entire length of the lay-off (whether it exceeds 35 weeks or not) is included in length of employment for purposes of determining eligibility for and the calculation of the amount of severance pay.
In this case, the employee's length of employment for purposes of severance pay would be the period from September 2, 2000, to September 2, 2008, plus the period from September 2, 2009, to September 2, 2013, for a total of 12 years of employment. (Although the employee retained the right to recall between September 2, 2008, and September 2, 2009, and again between September 2, 2013, and June 1, 2014, this time is not included because the lay-off in both cases became a severance under s. 63(1)(c).) Thus the employee in this example would be entitled to 12 weeks of severance pay.
In this example, the entire length of the first lay-off would be included, but only the first 35 weeks of the second lay-off would be included in calculating length of employment for purposes of s. 64(1) and s. 65(1). Thus, in this example, the employee's length of employment for purposes of s. 64(1) and s. 65(1) would be from September 2, 1980, to September 2, 2014, i.e., 34 years.
Multiple periods of employment with the same employer must be added together regardless of the amount of time between the periods of employment or the reason any of the periods of employment came to an end (e.g., whether the employee resigned or had their employment severed at the employer's behest). Situations sometimes arise where an employee works on and off for an employer over time. The employee returns to work with this same employer and then the employment is subsequently severed. How is the calculation of the employee's length of service made in this type of situation? The employee's length of service is calculated by adding together all stretches of employment, regardless of how long the gap(s) between periods of employment was or why the employment relationship had previously ended. This is so even if the earlier employment was with a different company that was subsequently purchased by the current employer. See National Electrical Carbon Canada/Morganite Canada Corporation o/a Thermal Ceramics v Reader (July 23, 1998), 0744-97-ES (Sargeant), a decision under the former Employment Standards Act.
Where the employee's first stretch of employment ended in a resignation rather than a dismissal, the two stretches of employment must be added together to determine the employee's length of employment for purposes of calculating the amount of severance pay. This is supported by two unreported Divisional Court cases, Re Oakridge Ford Sales (1981) Ltd. and Re Standard Tube Canada Inc., both issued under the former Employment Standards Act. It should be noted that, prior to those court cases, there was at least one referee's decision to the contrary on that particular point – for example, see Canada Trust Co. v Holmes (June 13, 1990), ESC 2710 (Brown), a decision under the former Employment Standards Act. However that decision is contrary to the two court cases above and should not be followed.
In a case where the employee had already received severance pay in regards to a previous stretch of employment, the amount of severance pay already paid may be deducted from the severance pay owing pursuant to paragraph 3 of s. 65(8). For more information on deductions from severance pay, refer to s. 65(8) below.
The issue arises whether an employee who is employed on a series of fixed-term contracts or is a seasonal employee is entitled to severance pay. Whether the terms are consecutive or broken, s. 65(2) requires that all this time shall be included in determining whether the employee is eligible for severance pay under s. 64(1) and in calculating the amount of their severance pay under s. 65(1). Therefore, if the employee's length of employment meets or exceeds the five-year requirement set out in s. 64(1), they will be entitled to severance pay in accordance with their length of employment as determined under s. 65(1).
This subsection was added by the Good Government Act, 2009, SO 2009, c 33,and applies to employees whose employment is severed on or after November 6, 2009. Under this subsection, if an employee is receiving an actuarially unreduced pension benefit and then has their employment severed, time employed with the employer for which they received service credits that were used to calculate the pension benefit, will not be included in determining whether the employee is eligible for severance meeting the five year threshold as per ESA Part XV, s. 64(1) or for the purposes of calculating the amount of the severance entitlement under s. 65(1).
This subsection applies, for example, to situations where an employee had previously retired on an actuarially unreduced pension and is subsequently rehired by the employer and then later still has their employment severed (on or after November 6, 2009).
This provision is not to be confused with the exemption from severance in O Reg 288/01, s. 9(1) paragraph 3 that applies to an employee who, on having their employment severed, retires and receives an actuarially unreduced pension benefit. See the discussion regarding this exemption at O Reg 288/01, s. 9(1) para. 3.
Section 65(2.1) is not an exemption from severance. It applies to exclude time for which the employee has received service credits in the calculation of their actuarially unreduced pension for the purposes of determining eligibility for and quantum of severance pay.
Employee A is employed by Company A for 25 years. Their employment is then severed but they are able to and does then retire with an actuarially unreduced pension benefit that reflects any service credits that they would have been expected to have earned in the normal course had their employment not been severed. Assume 25 years' worth of service credits in this example. O Reg 288/01, s. 9(1) paragraph 3 applies to exempt employee A from severance pay.
Employee A is subsequently rehired by Company A and works seven more years for the company. Their employment is again severed. Because they were in receipt of an actuarially unreduced pension benefit BEFORE being severed this second time, the exemption in O Reg 288/01, s. 9(1) paragraph 3 has no application. Employee A is not exempt from severance entitlements.
However, because the service credits for the previous 25 years of employment had been included when calculating their actuarially unreduced pension benefit, they are not, as per s. 65(2.1) included when determining whether they meet the five year eligibility threshold under ESA Part XV, s. 64(1) or for calculating the quantum of his severance pay as per s. 65(1). Only their most recent seven years of employment will be considered. Assuming the employer has a payroll of $2.5 million or more, this employee will be entitled to severance pay (having met the five year eligibility threshold) and the quantum will be calculated as seven weeks of severance pay.
Employee B worked for company B for 30 years and retired with an actuarially unreduced pension benefit based on 30 years' worth of service credits. There was no severance pay payable at this time because their employment was not severed by their employer.
Employee B was subsequently rehired by company B and worked for an additional three years. Their employment was then severed. Because they were in receipt of an actuarially unreduced pension benefit BEFORE being severed, O Reg 288/01, s. 9(1) paragraph 3 does not apply to exempt them from severance entitlements.
However, as the service credits for the previous 30 years employment had been included when calculating their actuarially unreduced pension benefit, they are not, as per s. 65(2.1), included when determining eligibility for severance under ESA Part XV, s. 64(1) or calculating quantum of severance pay under s. 65(1). They are considered to have only three years of employment with company B for the purposes of determining severance entitlements and therefore does not meet the five year threshold for eligibility.
Section 65(3) creates an exception to s. 65(2) with respect to employment included in the calculation of severance pay. This exception applies when an employee resigns during a statutory notice period in accordance with ESA Part XV, s. 63(1)(e).
Under ESA Part XV, s. 63(1)(e) and s. 63(3), an employee who has been given notice of termination in accordance with ESA Part XV, s. 57 or s. 58 and who provides two weeks' notice of resignation that takes effect during the statutory notice period, is deemed to be severed on the date the employer's notice would have taken effect. Further, s. 65(2) provides that the period of employment up to the date of the deemed severance (i.e., the date the employer's notice would have taken effect) is included in determining eligibility for severance pay (i.e., the five-year employment threshold) as well as the calculation of the amount of severance pay.
However, s. 65(3) provides that the period of time between the date the employee's notice of resignation takes effect and the date the employer's notice of termination would have taken effect (the deemed date of severance) does not count in the calculation of the amount of severance pay owing (although this period continues to count with respect to determining eligibility for severance pay).
For example, an employee was provided with eight weeks' written notice of termination that would end on March 28. The employee provides two weeks' written notice of resignation on February 1 (the effective date of which falls within the statutory notice period). For the purpose of calculating the amount of severance pay owing, the employee's length of employment is counted only up to February 14, the employee's last day of work. No account is taken of the period between February 15 and March 28 for the purposes of calculating the amount of severance pay, even though March 28 is deemed to be the severance date by ESA Part XV, s. 63(3).
However, under s. 65(2), the length of employment for the purpose of determining eligibility for severance pay includes the inactive time up to the deemed severance date. In the above example, the employee's employment is deemed severed on March 28. Therefore, account is taken of the period between February 15 and March 28 for the purpose of determining whether the employee is eligible for severance pay.
In summary, in determining eligibility for severance pay, the period after the resignation takes effect is included under ESA Part XV, s. 63(3) and s. 65(2). In calculating the amount of severance pay, the period after the resignation takes effect is excluded as per s. 65(3).
This section provides that where notice of termination required to be given under ESA Part XV, s. 57 or s. 58 is not provided, the period of the notice that should have been provided is to be included in the employee's length of employment for purposes of calculating the amount of severance pay under s. 65(1).
For example, where an employee, who was terminated on February 1 should have been provided with eight weeks' written notice of termination, the employee's length of employment for the purpose of calculating the amount of severance pay will include the period up to March 28.
It is Program policy that this period must also be included for the purpose of determining whether the five-year threshold for eligibility for severance pay has been met; otherwise, the employee's severance pay entitlement would be calculated as zero, which would be contrary to the s. 65(4) direction that it be calculated as if the employee had continued to be employed for the period of notice that should have been given.
This section sets out a maximum amount of severance pay an employee may be entitled to under s. 65(1). It caps the entitlement at an amount equal to the employee's regular wages for a regular work week for 26 weeks.
See also s. 65(1) above for a discussion of Program policy regarding the phrase "regular wages for a regular work week" in the context of severance pay calculations.
This section outlines how to determine an employee's regular wages for a regular work week where the employee does not have a "regular work week" or is paid on a basis other than time.
Regular wages and regular work week are defined in ESA Part I, s. 1 as follows:
Section 65(6) provides for an averaging of the employee's regular wages received over the 12 weeks worked immediately preceding the day the employee's employment was severed or, where the employee's employment was deemed severed as a result of being on a lay-off, the day the lay-off began.
The formula requires that only the weeks in which the employee worked be included. Therefore, if the employee has not worked at all during certain weeks in the designated 12-week period, then those weeks are not included in the calculation. For example, if the employee was on a contractual short-term disability leave for one of the 12 weeks and did not work at all during that week, his/her regular wages would be determined by averaging the regular wages earned over the 11 weeks in which he or she worked. Weeks where the employee was away from work all week on a leave under Part XIV, contractual leave, other approved leave, vacation or lay-off are considered weeks not worked. As noted above, where the employment was severed as a result of a lay-off under ESA Part XV, ss. 63(1)(c) or (d), the 12-week period precedes the date on which the lay-off began.
The question arises as to how to complete the calculation where the employee who does not have a regular work week or is paid on a basis other than time was, for example, on a contractual short-term disability leave or other leave for the entire designated 12-week period. Because s. 65(6) does not provide a mechanism to calculate the average wages in that situation, Program policy is that the employer must continue to look back in blocks of 12 weeks, until a 12-week period can be found in which the employee has at least one week worked and then average the wages earned over the number of weeks worked in that 12-week period.
For example, an employee was on pregnancy and parental leave for 52 weeks prior to her employment being severed. Note that a combined pregnancy and parental leave may be longer than 52 weeks, up to a maximum entitlement of 78 weeks. The employer looks back in 12-week blocks until it finds a 12-week block that contains some weeks worked by the employee. In this case, the employer looks:
The 12-week block to be used will be the period of time that was 48 through 60 weeks prior to the severance. The employee worked eight weeks during that time, so her regular wages for a regular work week will be the average of her regular wages over those eight weeks.
This section provides that severance pay is payable in addition to any other payment owing under the Act. For example, if an employee was dismissed without notice after 10 years of employment, they would be entitled to eight weeks' termination pay under ESA Part XV, s. 61(1) and 10 weeks of severance pay under ESA Part XV, s. 64(1). This section provides that the eight weeks of termination pay (an amount the employee is entitled to under the Act) is payable in addition to the 10 weeks of severance pay, preventing one from being set-off against the other. Further, this section provides that severance pay is payable in addition to any payments owing under a contract of employment.
This section is subject to s. 65(8), which permits certain set-offs/deductions from severance pay.
Section 65(8) outlines the set-offs and deductions that may be made when calculating an employee's severance pay. Three types of set-offs/deductions are permitted: supplementary unemployment benefits, contractual amounts for the loss of employment and severance pay previously paid under the former Employment Standards Act or the ESA 2000.
Paragraph 1 of s. 65(8) provides that supplementary unemployment benefits ("SUBs") that an employee receives after the employment is severed and before the severance becomes payable may be set-off/deducted when calculating severance pay.
SUBs are amounts that an employer pays to an employee to top up the employee's employment insurance benefits. For example, if the employee is receiving $300 a week under the Employment Insurance Act, the SUBs plan that the insurer has set up might entitle the employee to a further $100 a week while they are unemployed. The term "supplementary unemployment benefit" is not defined in the Act. However, it is defined in the federal Income Tax Act, RSC 1985, c 1 (5th Supp). It is still possible for a plan that does not meet the definition in the Income Tax Act to be considered a SUBs plan for purposes of s. 65(8). If the plan is a bona fide plan and is for the purpose of topping up the employee's employment insurance benefits then the SUBs will be deductible.
In this situation, the first question is whether the employer can deduct from the severance pay the SUBs that were paid to the employee between January 20 and September 6. The answer is no, since s. 65(8) refers to SUBs received after the employment is severed but before the severance pay becomes payable. In the above-noted example only the SUBs received by the employee between September 6, the date the severance occurs, and November 1, the date the severance pay becomes payable, can be deducted from the severance pay owing to the employee.
Paragraph 2 in this section provides that an amount paid to an employee for the loss of employment under a contract of employment where the payment is based on length of employment, length of service or seniority may be set-off/deducted from severance pay. For example, an employee whose employment is severed after 25 years of service receives payment of two weeks per year to a maximum of 20 weeks under a contract of employment. Under s. 65(1), the employee is entitled to 25 weeks of severance pay. In this case, s. 65(8) provides that the employer may set-off/deduct the 20 weeks paid to the employee from the severance pay.
Furthermore, if the employer, pursuant to a provision of an employment contract, gives a greater amount of termination pay than is required under the Act, the employer may set-off/deduct the excess termination pay from the severance pay entitlement.
Where the employer agrees to provide salary continuance after termination, and the agreement specifically states that severance pay is included in the amounts paid, ESA Part V, s. 11(5) will not invalidate the agreement.
Paragraph 3 of s. 65(8) provides that an employer may deduct the amount of severance pay paid previously under the Act, a predecessor of the Act or a contractual provision of an employment contract. Under paragraph 3 it is the actual amount of severance pay paid previously that may be set-off/deducted.
The question arises as to how the employee's severance pay should be calculated for purposes of the 2015 dismissal. In this example, the employee would be considered to have 11 years of employment with the employer (six years during the first period and five years during the second). Based on the employee's length of employment of 11 years and their current salary of $2,000 per week, the employee would be entitled to severance pay in the amount of $22,000 before taking into account any severance pay previously paid. Paragraph 3 allows an employer to take into account the severance pay previously paid by setting-off/deducting the amount paid from the current entitlement. Therefore, the employee is entitled to $22,000 – $6,000 = $16,000 following the 2015 dismissal.
The question sometimes arises as to what happens where the employee is bound by a severance pay settlement with respect to an earlier dismissal, either because the union has entered into such a settlement with the employer or because the employee has entered into such a settlement himself or herself. In this situation, the employer is limited to deducting the actual amount of severance pay that was paid as the settlement. Using the example discussed above, if a settlement of $3,000 had been reached with respect to the first dismissal, the employer would be entitled to set-off/deduct only $3,000 from the $22,000 total, resulting in the employee receiving $19,000 of severance pay following the 2015 dismissal.
The situation may also arise where the amount of the settlement exceeds the amount of severance pay that was required under the statute in force at the time the employment was severed. In this situation, the employer is permitted to deduct the actual amount of the settlement that was for severance pay. Using the example discussed above but with a settlement of $10,000 in respect of the first dismissal, the employer would be entitled to set-off/deduct $10,000 from the $22,000 total, resulting in the employee receiving $12,000 of severance pay following the 2015 dismissal.
Section 66(1) provides that an employer may pay severance pay in instalments directly to an employee where the employee and employer agree (in writing – see s. 1(3) of the Act) or with the approval of the Director of Employment Standards. See Delegation of Powers for a listing of the persons to whom this power of the Director has been delegated.
Note that where an employer and an employee have agreed to an instalment plan to pay an employee severance pay under this section, the provisions in s. 67 of the Employment Standards Act, 2000 regarding the election to retain recall rights or to be paid severance pay forthwith do not apply (see s. 67(2)). Therefore, an employee who agrees to an instalment plan is not required to make an election with respect to the payment of severance pay or retention of recall rights. Consequently, the employee preserves recall rights because he or she is not required to make an election and the employer is not required to pay any unpaid severance pay into trust. Note, however, that s. 67 will continue to apply with respect to an election for the payment of termination pay forthwith or the retention of recall rights.
However, if an employer pays severance pay by instalment to an employee under a plan approved by the Director (as opposed to under an agreement between the employer and employee), s. 67 will continue to apply with respect to the election to be paid severance pay forthwith or to retain recall rights. In this situation, the employee will retain the right to be recalled, unless he or she expressly elects to be paid the severance pay under s. 67(3). Further, in the absence of such an election, the employer will be required to either pay the severance instalments to the Director in trust under s. 67(6) or, if the employee is represented by a trade union, pay the severance instalments in trust as agreed by the union and the employer or to the Director in trust in the absence of such an agreement under s. 67(7). It is important to note that the employer will be required to meet its obligations as set out in ss. 67(6) or (7) unless the employee has expressly elected to accept the severance pay. Hence, an employer may wish to obtain this election from its employees prior to making any severance pay payments.
Some of the factors that the Director may consider in determining whether to approve the instalment plan may include:
Section 66(2) places a maximum payment period of three years for an instalment plan.
Section 66(3) provides that where an employer fails to make an instalment payment, the remaining severance pay becomes payable immediately.
The question may arise as to what happens to the employee's recall rights where the employer defaults on the plan:
Where the instalment plan for the payment of severance pay is based on an agreement between the employer and employee, the provisions regarding the employee's election between being paid severance pay or retaining the right to be recalled do not apply (s. 67(2)). Thus the employee maintains recalls rights (unless he or she had already made an election to be paid termination pay forthwith and is deemed to have abandoned recall rights) as well as the entitlement to be paid severance pay in instalments. If the employer defaults on the instalment plan, all outstanding severance pay becomes payable immediately to the employee. The employee's right to be recalled would remain unaffected.
Under a Director-approved instalment plan, the s. 67 provisions on the employee's election between recall rights and being paid severance pay do apply. Where the employee fails to make an election or chooses not be paid the severance pay, he or she would retain recall rights. Where the employee elects to be paid the severance pay, pursuant to s. 67(5), the employee is deemed to have abandoned his/her right to recall. However, it is Program policy that the employee could escape from this election, on the basis that it would be either an express or implied condition of the election that the employer completes all of the instalments. If this were not the case, situations of obvious unfairness would arise. For example, consider the following situation: the employee elects to give up recall rights and take severance, a short time later the employer defaults on the instalments, goes into bankruptcy, and some time later a purchaser buys the business and hires back all those employees with recall rights. In that situation, not to allow the employee to consider his or her election void would be to deprive him or her of both severance pay and recall rights, which is not the intent of the section. However, this proposition has not yet been tested before the Ontario Labour Relations Board, an arbitrator or a court. To provide more certain protection against these types of situations it is advisable that instalment plans contain a specific condition that any election to forfeit any recall rights be void if all the severance instalments are not paid by the employer pursuant to the plan.
Section 67(1) sets out the circumstances in which the provisions regarding the election of recall rights apply. This section is subject to s. 67(2) of the Employment Standards Act, 2000, discussed in subsection (2) below.
Section 67(1) states that s. 67 will apply where an employee has the right to be recalled for employment under a contract of employment (which includes a collective agreement) and either a) or b) below applies:
Employees who are entitled to termination pay because of a temporary lay-off that equals or exceeds 35 weeks in a period of 52 consecutive weeks (s. 56(2)(b) or s. 56(2)(c)) are subject to s. 67. In that case, the employer of such an employee is also subject to s. 67.
This section does not apply if the termination pay comes due for reasons other than as a result of a lay-off that equals or exceeds 35 weeks in a period of 52 consecutive weeks. Therefore, it will not apply where, for example, there is a termination because of a lay-off that exceeds 13 weeks in a 20-week consecutive period (s. 56(2)(a)). In that case, the employee is not required under the Act to make an election in order to receive termination pay after 13 weeks of lay-off and will not be deemed under the Act to have abandoned the right to be recalled in accepting that payment. If the employee is entitled to severance pay, however, he or she will be required to make an election with respect to the payment of the severance pay and the retention of recall rights. It should also be noted that a collective agreement or contract of employment may provide for the loss of recall rights as a consequence of an employee's acceptance of termination pay that comes due other than as a result of a lay-off that equals or exceeds 35 weeks in a period of 52 consecutive weeks.
Subject to s. 67(2), employees who are entitled to severance pay under s. 64(1) of the Act are subject to the provisions of s. 67. The employee's employer is likewise subject to the provisions of s. 67.
Typically, a right of recall will be contained in a collective agreement. However, s. 67(1) is not limited to situations where the right of recall is contained in a collective agreement. It is possible that a non-unionized employee might have a right of recall in the terms and conditions of his or her employment. However, these instances will be somewhat unusual. It will have to be demonstrated clearly that the right of recall in a non-unionized situation was formalized as part of the employment contract and not merely ad hoc, in order for the recall rights to be within the meaning of s. 67(1).
Section 67(2) provides that, despite s. 67(1)(b), the provisions of s. 67 will not apply with respect to the severance entitlement where an employer and an employee have agreed to pay an employee severance pay in instalments under s. 66. See ESA Part XV, s. 66 for a detailed discussion of severance instalment plans under s. 66 of the Act. As such, an employee who agrees to accept severance pay by instalment will not be required to make an election as between the payment of his or her severance pay and retaining the right to recall, and the employer will not be required to pay the severance pay into trust.
However, s. 67 will apply where an instalment plan is in place because the Director has approved the payment of severance pay by instalments (as opposed to it being in place as a result of employee agreement). Accordingly, in that case, the employee must elect either to be paid the severance pay (by instalment) or retain his or her recall rights. If that employee also has the right to termination pay because of a lay-off of 35 weeks or more, the same election must be made with respect to both the termination pay and severance pay entitlements – see s. 67(4). Note that if that employee does not make an election, or elects not to be paid the termination and severance pay, the employee will not be deemed to have abandoned the right to be recalled under s. 67(5) even though the employer pays the employee severance pay by instalment under a plan approved by the Director, since the employee has not expressly elected to be paid the severance pay under s. 67(3).
This section is similar to the corresponding provisions (ss. 57(19) and 58(10)) of the former Employment Standards Act.
This section provides that an employee may choose to have termination pay or severance pay paid to them immediately, or instead may choose to retain the right to be recalled.
In Moore Packaging Corp. v Canadian Paperworkers Union, Local 1150 (1993), 34 LAC (4th) 293 (Ont Arb Bd), a decision under the former Employment Standards Act, the arbitrator held that an employee must make an express election prior to receipt of the severance pay if he or she is to be deemed to have elected "to be paid the severance pay forthwith". The decision states that if there is no such express prior election and the employer sends the severance pay to the employee, the employee's subsequent cashing of the cheque may not, by itself, constitute an election to receive the severance pay forthwith within the meaning of the section. This is on the basis that the employee, in cashing such a cheque, may not have had the specific intent to elect to choose between severance pay and recall rights. From an employer's perspective, it would make sense, therefore, to attempt to ensure that the employee was given the opportunity to specifically choose between severance pay and recall rights sometime prior to the date for payment, and also to ensure that the employee fully understood the consequences of his or her choice vis-à-vis recall rights, prior to making such a choice.
Note, however, that this provision does not apply with respect to the employee's severance pay entitlement if the employee and employer have agreed to (as opposed to the Director approving) the payment of severance pay by instalment under s. 66 of the Act. In that event, s. 67(2) provides that the provisions of s. 67 (including s. 67(3)) do not apply with respect to the severance pay entitlement.
This section is similar in part to the corresponding provisions (ss. 57(20) and 58(11)) of the former Employment Standards Act.
Section 67(4) provides that if an employee is entitled to termination pay on or after 35 weeks of lay-off in a period of 52 consecutive weeks and to severance pay, the employee must make the same election with respect to both. Note, however, that this requirement does not apply if the employee and employer have agreed to (as opposed to the Director approving) the payment of severance pay by instalment under s. 66 of the Act. In that event, s. 67(2) provides that the provisions of s. 67 (including s. 67(4)) do not apply with respect to the severance pay entitlement.
This section is similar in part to the corresponding provisions (ss. 57(20) and 58(11)) of the former Employment Standards Act.
Section 67(5) provides that where an employee elects to be paid termination pay that became due because of a lay-off of 35 weeks in a period of 52 consecutive weeks, or severance pay, he or she will be deemed to have abandoned his or her right to be recalled.
Note, however, that this provision does not apply if the employee and employer have agreed to (as opposed to the Director approving) the payment of severance pay by instalment under s. 66 of the Act. In that event, s. 67(2) provides that the provisions of s. 67 (including s. 67(5)) do not apply with respect to the severance pay entitlement.
This section is similar in part to the corresponding provisions (ss. 57(21) and 58(12)) of the former Employment Standards Act.
Section 67(6) provides that where an employee who is not represented by a trade union is entitled to termination pay because of a lay-off of 35 weeks in a period of 52 consecutive weeks and/or severance pay, and elects to retain the right to be recalled or makes no election, the employer must pay the termination and/or severance pay to the Director in trust.
Section 67(6) only applies where the employee is not represented by a trade union. For trust arrangements for employees who are represented by a trade union, refer to s. 67(7).
It should also be noted that the requirement to pay termination pay and severance pay to the Director in Trust does not apply if the employee and employer have agreed to (as opposed to the Director approving) the payment of severance pay by instalment under s. 66 of the Act. In that event, s. 67(2) provides that the provisions of s. 67 (including s. 67(6)) do not apply with respect to the severance pay entitlement.
Provision for the pay out of monies held in trust is made in ss. 67(8) and (9). Refer to the discussion in subsections (8) and (9) below.
This section is similar in part to the corresponding provisions (ss. 57(21) and 58(12)) of the former Employment Standards Act. The requirement that the employer and union attempt to negotiate a trust arrangement was introduced by the ESA 2000.
Section 67(7) provides that where an employee who is represented by a trade union is entitled to termination pay because of a lay-off of 35 weeks in a period of 52 consecutive weeks and/or severance pay and elects to retain the right to be recalled, or fails to make an election, the employer and the trade union must attempt to negotiate, in good faith, an arrangement for holding the termination and/or severance pay in trust. Where the parties agree to an arrangement, the monies must be held in accordance with the arrangement. Where the parties cannot agree on an arrangement and the trade union advises the Director and the employer in writing that efforts have failed, the employer must pay the termination and/or severance pay to the Director in trust.
Where the parties either do not attempt to negotiate an agreement in good faith or the union does not notify the Director and the employer in writing that no agreement could be reached, there will not be an obligation for the employer to pay the monies to the Director and there will not be an obligation for the Director to hold the monies in trust.
It should be noted that this section only applies where an employee is represented by a trade union. For trust arrangements for employees who are not represented by a trade union, refer to s. 67(6).
Provision for the pay out of monies held in trust is made in ss. 67(8) and (9). Refer to the discussion in subsections (8) and (9) below.
Section 67(8) provides that where the employee accepts a recall to work, the monies held in trust must be paid out to the employer and the employee is deemed to have abandoned the right to termination and severance pay.
Subsection 67(8) deals only with the issue of what happens to the termination and severance pay that was paid into trust when an employee accepts a recall; neither it, nor any other provision in s. 67, has any bearing on what constitutes a termination within the meaning of s. 56 or what constitutes a severance within the meaning of s. 63. See the Court of Appeal decision in United Steel v National Steel Car Limited, 2013 ONCA 401 (CanLII), where the Court rejected the employer's argument that s. 67 means that an employee who accepts a recall cannot have any of the time spent on lay-off prior to the recall taken into account in determining whether there was a subsequent termination or severance. See ESA Part XV, s. 63(1) for further discussion of this case.
Sometimes situations will arise in which the employer recalls an employee who had elected to retain recall rights under s. 67 and the employee refuses to return to work. Because the employee's refusal occurs after the point at which the employee became entitled to termination pay or severance pay, the employee's refusal to accept the recall cannot disentitle him or her to that termination pay or severance pay. Specifically, none of the exemptions in ss. 2(1) or 9(1) of O Reg 288/01 apply to exempt such an employee from termination or severance pay to which he or she is already entitled. While paragraph 7 of s. 2(1) of O Reg 288/01 provides that an employee on a temporary lay-off is exempt from the termination provisions if he or she does not return to work when recalled, it does not apply to a refusal to return to work that occurs after the point at which the right to termination pay has crystallized. Further, there is no exemption from severance pay in O Reg 288/01 that corresponds to paragraph 7 of s. 2(1) of the regulation. Accordingly, an employee who has been recalled after his or her termination or severance entitlements have crystallized may refuse to return to work and then renounce his or her recall rights, in which case he or she will be entitled to receive any termination or severance pay held in trust in accordance with s. 67(9) – see the discussion below. Alternatively, an employee could refuse the recall but choose to retain the recall rights (if he or she did not lose them under the terms of the contract or collective agreement for having refused to return to work when recalled), in which case the money would continue to be held in trust. If the employee's refusal resulted in the automatic termination of recall rights under the terms of the contract or collective agreement, then the result would be the same as if the recall rights had expired, i.e., the money would be paid out of trust to the employee.
Situations may also arise in which a long service employee who had been laid off for 35 weeks in a period of 52 consecutive weeks elects to retain recall rights and then, after more than 13 weeks elapse, accepts a recall, only to have the employer terminate the employee's employment two weeks later. How is the employee's length of service calculated for purposes of notice of termination in this case? Because of the “period of employment” rule in s. 8 of O Reg 288/01, only the last two weeks of employment would be considered in calculating the employee's period of employment. As a result, the employee would be entitled to one week's notice or one week's termination pay. While the employee's period of employment is only two weeks, the employee was "continuously employed for three months or more" within the meaning of s. 54 and so is entitled to notice or termination pay in accordance with s. 57(a).
This section is similar in part to the corresponding provisions (ss. 57(21) and 58(12)) of the former Employment Standards Act.
Section 67(9) provides that where the employee renounces the right to be recalled or the rights expire, the monies held in trust must be paid out to the employee and the employee is deemed to have abandoned the right to be recalled.
Although the section does not identify a specific person as being responsible for making this payment, it is implied that the person who holds the monies in trust is required to make the payment. It may be the Director or another person pursuant to the employer-trade union arrangement who holds the monies in trust.
Section 67.1 provides enhanced definitions of "employee" and "employer”, and a definition of "non-compete agreement”, which apply for the purposes of Part XV.1 and the following provisions of the Employment Standards Act, 2000 insofar as matters concerning this Part are concerned:
“employee” means an employee as defined in subsection 1 (1) and includes an applicant for employment;
The definition of "employee" in s. 67.1 expands the definition provided in s. 1(1) of the Act. Section 1(1) defines "employee" as follows:
and includes a person who was an employee.
For matters concerning the Non-Compete Agreements Part of the Act, the definition of "employee" is expanded to include an applicant for employment.
“employer” means an employer as defined in subsection 1 (1) and includes a prospective employer;
The definition of "employer" in s. 67.1 expands the definition in s. 1(1) of the Act. Section 1(1) defines "employer" as follows:
“non-compete agreement” means an agreement, or any part of an agreement, between an employer and an employee that prohibits the employee from engaging in any business, work, occupation, profession, project or other activity that is in competition with the employer’s business after the employment relationship between the employee and the employer ends.
Subsection 67.2(1) prohibits employers, with certain exceptions, from entering into employment contracts or other agreements that are, or that include, a “non-compete agreement”.
“Non-compete agreement” is defined to mean an agreement, or any part of an agreement, between an employer and an employee (which includes a prospective employer and an applicant for employment as per the other definitions in s. 67.1), that prohibits the employee from engaging in any business, work, occupation, profession, project or other activity that is in competition with the employer’s business after the employment relationship between the employee and the employer ends.
An agreement, or part of an agreement, is a “non-compete agreement” only if it “prohibits” the employee from engaging in any business, work, occupation, profession, project or other activity that is in competition with the employer’s business after the end of the employment relationship.
It is Program policy that an agreement, or part of an agreement, is a “non-compete agreement” only if it explicitly prohibits the employee from competing.
For example, an employer and an employee enter into an agreement, or part of an agreement, that requires the employee to pay the employer substantial fees to reimburse the employer for training or other costs if the employee quits. That agreement (or part of an agreement) does not explicitly prohibit the employee from competing and as such is not a “non-compete agreement”.
As another example, an agreement, or part of an agreement, that prohibits employees from soliciting the employer’s customers is not a “non-compete agreement”. (See below for more information on “non-solicit” clauses.) It is Program policy that a non-solicit clause will not be considered to be a “non-compete agreement” even if for practical purposes the circumstances (e.g. industry or geography) are such that the non-solicit clause renders it impossible for an employee to start a competing business or to work for a competitor.
For example, an employee is employed to sell a very specialized medical instrument where every potential purchaser of the product is a client of the current employer. The employee and employer entered into a non-solicit agreement that prohibits the employee from contacting any firm that was a customer of the employer at any time during the employee’s employment with the employer for two years after the end of the employment relationship. It is Program policy that this agreement is not a “non-compete agreement” because it does not explicitly prohibit the employee from engaging in any business (work, etc.) that is in competition with the employer’s business, even though for practical purposes the non-solicit clause renders it impossible for the employee to start the employee’s own business that would compete with the employer. (An employee who believes a non-solicit clause is unreasonable may choose to challenge its enforceability in the courts.)
Disputes between employers and employees about the enforceability of non-compete agreements have historically been adjudicated by the courts, which generally have ruled that such agreements are not enforceable unless they are reasonable and in the public interest. An agreement, or part of an agreement, that fits the s. 67.1 definition of “non-compete agreement” will be considered to be a non-compete agreement whether or not it is reasonable or in the public interest.
An agreement, or part of an agreement, that prohibits an employee from engaging in any business (work, etc.) that competes with the employer after the end of the employment relationship may be a “non-compete agreement” whether or not the prohibition is time-limited.
For example, an agreement that prohibits the employee from engaging in work that is in competition with the employer’s business for six months after the employment relationship ends is a “non-compete agreement”. An agreement that has no expiry date on the prohibition is also a “non-compete agreement”.
An agreement, or part of an agreement, that prohibits an employee from engaging in any business (work, etc.) that competes with the employer after the end of the employment relationship may be a “non-compete agreement” whether or not the prohibition is geographically restricted.
For example, an agreement that prohibits the employee from engaging in work that is in competition with the employer’s business after the employment relationships ends within 100 km of the employer’s workplace is a “non-compete agreement”. An agreement that has no geographic restriction on the prohibition is also a “non-compete agreement”.
Non-compete, non-solicit and non-disclosure clauses or agreements are three main types of what are called restrictive covenant clauses in employment contracts. A restrictive covenant prevents someone from doing something or from using property in a certain way.
A non-solicit (or non-solicitation) clause or agreement is a provision in an employment contract that prohibits an employee from soliciting – i.e. actively pursuing, sometimes referred to as “poaching” - clients, customers, vendors, business partners or other employees of their employer, during the employment relationship and/or after the employment relationship has ended. Often, but not always, the non-solicit provision applies for a specified period after the end of the employment relationship, rather than indefinitely.
A non-disclosure clause or agreement is a provision in an employment contract that prohibits an employee from disclosing proprietary or confidential company information and processes.
The definition of “non-compete agreement” in s. 67.1 does not capture non-solicit agreements or non-disclosure agreements. As such, the prohibition in s. 67.2 with respect to entering into non-compete agreements does not apply to agreements that are non-solicit or non-disclosure agreements.
Some employers and employees may not use precise terminology when drafting their agreements and may use “non-compete” / “compete” incorrectly or interchangeably with “non-solicit” / “solicit” or “non-disclosure”. When determining whether an agreement falls within the definition of a non-compete agreement, the substance of the agreement is what matters, not the words that are used. When determining whether an agreement falls within the definition of a non-compete agreement, the Program looks at what activities the agreement prohibits. For example, an employment contract may have a heading that says “Non-Competition” in relation to a clause that says, “The employee will not, for two years after the end of the employment relationship contact any person, firm, corporation, or governmental agency who was a customer of the employer at any time during the employee’s employment with the employer.” Despite the heading “Non-Competition”, the substance of the clause is about soliciting rather than competing and as such does not fall into the definition of “non-compete agreement”.
Subsection 67.2(1) prohibits employers from entering into an employment contract or any other agreement with an employee that includes a non-compete agreement, or that is a non-compete agreement. “Non-compete agreement” is defined in s. 67.1
For greater certainty, ss. 67.2(2) reinforces that the effect of ss. 5(1) of the ESA (the “no contracting out” provision) is to void any non-compete agreement that was entered into in contravention of ss. 67.2(1).
These provisions must be read in conjunction with ss. 67.2(3) and (4), which establish exceptions to the prohibition.
Subsections 67.2(1) and (2) only prohibit and void the parts/words of an employment contract or other agreement that fit within the definition of “non-compete agreement”. This means, for example, that where an employment contract contains both a prohibited non-compete agreement and a non-solicit clause that is not prohibited, only the non-compete agreement is prohibited and voided. (See the definition of “non-compete agreement” in s. 67.1 for a discussion of these terms.)
These subsections, along with the rest of Part XV.1, were added to the ESA by the Working for Workers Act, 2021 (WFWA). Although the WFWA received Royal Assent on December 2, 2021, Part XV.1 was deemed to have come into force on October 25, 2021, which was the day that the WFWA was introduced in the Legislature. As such, employers were prohibited from entering into non-compete agreements starting October 25, 2021, and any such agreements that were entered into on or after October 25, 2021 are void. Non-compete agreements that were entered into prior to October 25, 2021 are not prohibited, and are not voided, by the ESA.
Section 67.1 contains expanded definitions of “employee” and “employer” that apply for the purposes of Part XV.1. The expanded definitions include an applicant for employment and a prospective employer.
As such, the prohibition against entering into non-compete agreements applies even before the employment relationship begins, and if a prospective employer and an applicant for employment enter into a non-compete agreement, it is void.
The definition of “employee” also includes “a person who was an employee”. As such, the prohibition against entering into non-compete agreements continues to apply after the employment relationship ends and any non-compete agreement entered after the end of the employment relationship is also void.
Disputes between employers and employees about the enforceability of non-compete agreements have historically been adjudicated by the courts, which generally have ruled that such agreements are not enforceable unless they are reasonable and in the public interest.
Part XV.1 does not prohibit employees and employers from resolving disputes about the enforceability of non-compete agreements in the courts. (See s. 8 of the ESA.) Although Part XV.1 creates, with two exceptions, a prohibition against entering into all non-compete agreements on or after October 25, 2021 – regardless of whether a court would have ruled the agreement to be enforceable - parties may wish to go to court to resolve issues about, for example, the enforceability of non-compete agreements that were entered into prior to October 25, 2021, or if there is a dispute as to whether one of the exceptions applies or whether an agreement entered into on or after October 25, 2021 fits within the definition of a prohibited “non-compete agreement”.
With respect to the Employment Standards Program, claimants may file a claim alleging, for example:
Because the definition of “employee” in s. 67.1 includes applicants for employment and former employees, the allegations may be made with respect to events that occur before the employment relationship is entered into, during it, or after it ends.
Where an employer is found to have contravened s. 67.2, an Employment Standards Officer may:
The officer also has the authority to initiate a prosecution under the Provincial Offences Act (POA). (Note: at the time of writing, there was no authority to issue Part I “tickets” under the POA for contraventions of s. 67.2.)
67.2(3) If there is a sale of a business or a part of a business and, as a part of the sale, the purchaser and seller enter into an agreement that prohibits the seller from engaging in any business, work, occupation, profession, project or other activity that is in competition with the purchaser’s business after the sale and, immediately following the sale, the seller becomes an employee of the purchaser, subsection (1) does not apply with respect to that agreement.
Subsection 67.2(3) establishes one of the exceptions to the prohibition against entering into non-compete agreements.
It establishes that where:
then the prohibition against entering into non-compete agreements per ss. 67.2(1) does not apply to that agreement.
Because of the second condition – that the seller becomes an employee of the purchaser – this exception only applies where the seller is an individual or individuals – i.e. where the business that is sold operated as a sole proprietorship or a partnership. As such, the exception in s. 67.2(3) does not apply in the context of the sale of a corporation and, as such, the purchaser is prohibited by ss. 67.2(1) from entering into non-compete agreements with any employees of the seller that it employs (subject to the “executive” exception in ss. 67.2(4)).
Subsection 67.2(5) establishes definitions for the terms “executive” and “sale” in s. 67.2. These terms are used in the context of the exceptions set out in ss. (3) and (4) to the prohibition against entering into non-compete agreements.
“Executive” is defined to mean any person who holds the office of chief executive officer, president, chief administrative officer, chief operating officer, chief financial officer, chief information officer, chief legal officer, chief human resources officer or chief corporate development officer, or holds any other chief executive position]
Accordingly, the prohibition in s. 67.2(1) against employers entering into non-compete agreements does not apply with respect to any employee who holds any of the listed offices, or any other chief executive position.
When determining whether the exception to the prohibiton applies, it is the job title held by the employee that matters. The Program does not generally look behind the title and assess whether the employee’s duties appear to be at an executive level.
The exception to the prohibition will apply if the employee holds one of the listed job titles, even if they simultaneously hold other job titles that are not listed.
“Sale” is defined to include a lease. Note that the definition of “sale” for purposes of s. 67.2 is narrower from the definition of “sells” and “sale” in s. 9 of the Act (in Part IV, Continuity of Employment), where it includes a lease, a transfer and a disposition in any other manner.
Part XV.1 of the ESA prohibits, with certain exceptions, employers from entering into employment contracts or other agreements with an employee that are, or that include, a non-compete agreement.
Part XV.1 was added to the ESA 2000 by the Working for Workers Act, 2021 (WFWA). Although the WFWA received Royal Assent on December 2, 2021, Part XV.1 was deemed to have come into force on October 25, 2021 (which was the day that the WFWA was introduced in the Legislature).
As such, Part XV.1 prohibited employers from entering into non-compete agreements starting October 25, 2021, and any such agreements that were entered into on or after October 25, 2021 are void.
Part XV.1 does not prohibit or void non-compete agreements that were entered into prior to October 25, 2021.
Before the WFWA, disputes about enforceability of non-compete clauses were resolved through the courts. Nothing in Part XV.1 prohibits employees and employers from resolving disputes about the enforceability of non-compete agreements in the courts, regardless of when they were entered into, if they choose to do so.
The intent of Part XVI of the Employment Standards Act, 2000 is to prohibit the use of lie detectors by employers and prospective employers for personnel screening purposes. To this end, no one can require, request, enable or influence, indirectly or directly, an employee to submit to a lie detector test.
The Honourable Russell H. Ramsay, then Minister of Labour, on October 25, 1983, in his remarks upon the second reading of Bill 86, Employment Standards Amendment Act, 1983, SO 1983, c 55, provided the following reasons for introducing this legislation:
Section 68 was amended by the Employment Standards Amendment Act (Temporary Help Agencies), 2009, SO 2009, c 9,effective November 6, 2009 to incorporate a reference to s. 74.12, which prohibits clients of temporary help agencies from reprising against assignment employees of temporary help agencies.
This provision is similar to s. 46 of the former Employment Standards Act. Section 68 sets out enhanced definitions of "employee" and "employer" and the definition of "lie detector test", which apply for the purposes of the following provisions of the Employment Standards Act, 2000, including Part XVI, as far as matters concerning this Part are concerned:
In s. 68, for matters concerning "lie detectors", the definition of "employee" is expanded to include an applicant for employment, a police officer and a person applying to become a police officer.
The definition of "employer" in s. 68 similarly expands the definition in s. 1(1) of the Act. Section 1(1) defines "employer" as follows:
In s. 68, for matters concerning "lie detectors", the definition of "employer" is expanded to include a prospective employer as well as a police governing body (i.e., Police Services Board).
"Lie detector" is a popular rather than scientific term. No machine literally "detects lies." The definition in this provision encompasses any type of test taken or performed in conjunction with any type of device, instrument or machine, and for the purpose of assessing or purporting to assess the credibility of a person.
A "lie detector" commonly refers to a standard field polygraph that monitors several physiological variables by means of separate pens independently recording certain measures on a moving paper chart. The machine is connected to four "involuntary" or "autonomic" response measures and records changes in those measures. The machine does not measure lying. Rather, it indicates variations in physiological responses that are, in theory at least, not subject to the control of the person tested (Royal Commission into Metropolitan Toronto Police Practices, Report of the Royal Commission into Metropolitan Toronto Police Practices (Toronto: The Commission, 1976) at c XXIII). A "lie detector" may also include a "Psychological Stress Evaluator", that is, a voice stress analyser. This instrument is designed to register and measure changes in an individual's stress levels as reflected in his or her voice.
The definition of "lie detector test" does not include surveillance devices that are used to observe employees without assessing or purporting to assess their credibility. In other words, an employer is not precluded from testing an employee by observing and recording his or her actions. This is so, even if it involves the surreptitious observation of an employee by means of a device, since it is the employee's actions that are being observed, rather than his or her credibility in relation to statements the employee makes about his or her actions.
This provision is similar to s. 47(1) of the former Employment Standards Act. Section 69 establishes that employees, as defined under s. 68 of the Employment Standards Act, 2000, have a right not to take, be asked to take or be required to take a lie detector test.
The only exception to the employee's right not to be asked to take a lie detector test is provided by s. 71 of this Part, which states that a person may be asked by a police officer to take, consent to take and take a lie detector test administered on behalf of or by a member of a police force in Ontario during an investigation of an offence. However, nothing in s. 71 compels an employee to take a lie detector test administered by or on behalf of a police force.
This provision is substantially the same as the corresponding section (s. 47(2)) of the former Employment Standards Act. Section 70(1) prohibits any person (thus including an employer or any third party) from requiring, requesting, enabling or influencing, directly or indirectly, an employee to take a lie detector test. It is thus clear that a security service, personnel agency or any other third party is equally prohibited from requesting or requiring, whether on its own behalf or on behalf of an employer, an employee to submit to a lie detector test.
According to this section, no person may even request an employee to take a test (subject only to s. 71) since such a request would endanger the employee's statutory right not to take a test. A refusal by the employee might put his or her employment at risk, so the employee's consent might not be "free consent". As a result, an employee's right not to take a test could be compromised.
In addition, by prohibiting any person from enabling or influencing, directly or indirectly, an employee to take a lie detector test, this section implicitly prohibits any person from administering a lie detector test where the employee is unaware that he or she is being examined. For example, an employer could not use a voice stress analyser during a telephone conversation with the employee or on a tape recording of the employee's voice.
This provision is substantially the same as the corresponding section (s. 47(3)) of the former Employment Standards Act. Section 70(2) protects the employee by prohibiting any person, including the employee, from informing an employer that the employee has taken a test, and from disclosing to an employer the test results.
This provision is substantially the same as the corresponding section (s. 49) of the former Employment Standards Act. Section 71 ensures that s. 70(1) will not operate to preclude the voluntary submission by an employee (or any other person) to a lie detector test administered by, or on behalf of, a police force in Ontario in the course of the investigation of an offence
Section 71 allows a police officer to ask a person to take a lie detector test administered on behalf of a police force in Ontario or by a member of a police force in Ontario in the course of an investigation of an offence. Although the test may be administered by any other person (including an employer) on behalf of the police, the request to take the test must be made by a police officer. However, nothing in s. 71 compels an employee to take a lie detector test administered by or on behalf of a police force.
In response to the claim that the equivalent section under the former Employment Standards Act, s. 49, is inconsistent with the other provisions, former Attorney General Roy McMurtry, based on the 1976 Report of the Royal Commission into the Metropolitan Police Practices, stated that:
Note: courts in Canada have largely refused to admit polygraph evidence. However, the Quebec Court of Appeal ruled in R c Béland, [1984] CA 443 (QCCA)that the results of a polygraph test are admissible as relevant evidence. This decision was appealed to the Supreme Court of Canada and its decision in R c Béland, [1987] 2 SCR 398, 1987 CanLII 27 (SCC) was released in 1987. The majority of the justices essentially ruled out the use of the lie detector test results as evidence in court. Justice McIntyre stated in the Supreme Court decision supported by five of the seven judges who heard the case: ". . .the polygraph has no place in the judicial process where it is employed as a tool to determine or to test the credibility of witnesses."
The provisions found in Part XVII (Retail Business Establishments) of the Employment Standards Act, 2000 set out the rights of employees working in most retail business establishments to refuse to work on holidays and Sundays.
Section 72(1) is similar to s. 50(1) of the former Employment Standards Act. Section 72(1) provides that the application of Part XVII is limited to retail business establishments as defined in the Retail Business Holidays Act, RSO 1990, c R.30 ("RBHA"), employees who work in these establishments, and employers of these employees. However, s. 72(1) must be read subject to the exemptions in s. 72(2).
"Retail business establishment" is defined in the RBHA in s. 1(1) as follows:
An exhaustive list of what constitutes retail business establishments could not possibly be created, as many types of businesses are covered: clothing stores, department stores, supermarkets, pharmacies, laundromats, gas stations, car rental agencies, to name a few. In each case, a determination must be made: are goods or services being sold or offered for sale by retail?
The employees in those retail business establishments described in s. 72(1) - and not exempted under s. 72(2) - will have rights to refuse Sunday and holiday work, even if they are employed in businesses that are allowed to open on holidays under the exemptions in s. 3 of the RBHA, under tourism exemption by-laws prescribed under the RBHA, and employees in stores that open illegally on a holiday, in contravention of the RBHA.
All such employees are covered, both full-time and part-time, including non-sales workers such as cleaners, managers and security guards.
Although supervisors and managers may be excluded from Part VII's Hours of Work provisions by virtue of s. 4(1)(b) of O Reg 285/01 (Exemptions, Special Rules and Establishment of Minimum Wage), this exclusion does not mean that they can be required to work on a Sunday or holiday. If they refuse to work on a Sunday or holiday, then they can only be required to work during the remaining days of the week, although the maximum number of hours to be worked on those days is not governed by the Employment Standards Act, 2000.
Security guards are often employed by a security service, which then assigns them to a retail business establishment. Such employees also have the right to refuse to work as this Part applies to "employees . . . in . . . [retail business] establishments".
A shopping mall is a "retail business establishment". Therefore, its employees also have the rights set out in this Part; such employees include the cleaning staff, security guards who patrol the common areas of the mall, the people at the coat check and gift-wrapping services, and the person who works in the information booth.
When a store is closed, it is still a "retail business establishment" even though it is not selling goods or services to the public at that particular time; a retail business establishment is a "retail business establishment" all the time, whether open or closed. Therefore, this Part will apply and an employee may avail himself or herself of the right to refuse to work if asked to do so when the store is closed: for example, if the employer wants to take inventory or reorganize the store.
Section 72(2) is virtually identical to s. 50(2) of the former Employment Standards Act. Section 72(2) describes hospitality-industry businesses, which are exempt from the provisions of this Part as follows:
Such businesses include restaurants, cafeterias and cafés.
Such businesses include hotels, motels, motor lodges, inns, and tourist resorts and camps.
Such businesses include museums, art galleries, sports stadiums and arenas, video arcades, theatres, movie theatres, zoos, amusement parks, bars, taverns and nightclubs.
Employees of a business that merely sells goods or services are usually not exempt from this Part. However, if the business selling goods or services is incidental to one of the enumerated businesses in ss. 72(2)(a), (b) or (c), and is located in the same premises as that business, s. 72(2)(d) exempts its employees. Such businesses would include a gift shop in a museum, or a souvenir store in a hotel lobby or a sports stadium.
With the exception of s. 72(2)(d), the exemptions in s. 72(2) only apply to establishments whose primary retail business is one of those enumerated. Thus, for example, employees at a cafeteria in a department store, or the counter in a supermarket that sells ready-to-eat meals, would not be exempted as the primary business of the department store or the supermarket is not the sale of prepared meals. Such employees would still enjoy the rights prescribed by this Part.
The hospitality industry is exempted because of the nature of the industry. The hospitality industry is one of the corner-stones of the provincial economy, and it has been identified as having special needs that require business operations to continue throughout the week.
Section 73(1) is similar in effect to s. 50.2(l)(b) of the former Employment Standards Act. Section 73(1) provides that employees who work in retail business establishments covered under Part XVII have the right to refuse to work on public holidays as listed in s. 1 of the Employment Standards Act, 2000 (including Family Day prescribed by s. 1.1 of O Reg 285/01 as a public holiday) and on any day declared by the Lieutenant Governor to be a holiday for the purposes of the Retail Business Holidays Act, RSO 1990, c R.30. At the time of writing, no other holiday had been proclaimed by the Lieutenant Governor.
An employee does not have to give any reason for refusing to work on a holiday.
Employers who are permitted to open on public holidays cannot avoid the application of s. 73(1) through hiring practices for new employees that include stipulations or understandings that public holidays are regular days of work; once hired, the employee’s right to refuse to work on a public holiday is absolute. Note that as the provision applies only to persons already working at an establishment, i.e., because it applies to "employees", a person cannot make a complaint under the Act if he or she has not been hired because of a refusal to work on holidays. However, such a person may have legitimate grounds for a complaint under the Human Rights Code, RSO 1990, c H.19 and should be referred to the Ontario Human Rights Commission.
An issue has arisen as to whether an employee who has given up the right to refuse Sunday work (pursuant to s. 10 of O Reg 285/01 - see the discussion at O Reg 285/01 s. 10) has by doing so also given up the right to refuse to work on a public holiday where the public holiday falls on a Sunday. It is Program policy that the answer to this question is no. The right to refuse Sunday work and the right to refuse work on public holidays are two separate rights, although they may sometimes overlap. An employee may give up the right to refuse Sunday work, but the employee continues to have the right to refuse work on any public holiday. Accordingly, an employee who gave up the right to refuse Sunday work will have the right to refuse to work on a public holiday where the public holiday falls on a Sunday.
Beyond the s. 73 rights to refuse work on Sundays and holidays, there is no general right under the Act of an employee to refuse to work on a particular day. However, if an employee refuses to work any other day because of bona fide religious beliefs, for example, he or she may have a complaint under the Human Rights Code. If such is the case, the employee should be referred to the Human Rights Commission.
Section 73(2) is similar in effect to s. 50.2(l)(a) of the former Employment Standards Act in permitting retail employees to refuse Sunday work. However, the right to refuse Sunday work under the former Act was absolute, whereas the right to refuse Sunday work in s. 73(2) of the ESA 2000 is subject to the exception set out in s. 10 of O Reg 285/01 as follows:
Section 10(1) of O Reg 285/01 states that even though retail employees have the right to refuse to work on Sundays under s. 73(2) of the Act, an employee loses this right if he or she had agreed to work on Sundays at the time he or she was hired by an employer. In accordance with s. 1(3) of the ESA 2000, an agreement made at the time of hiring to work on Sundays must be in writing. The exception created by s. 10(1) only applies to such agreements made on or after September 4, 2001 (the date the ESA, 2000 came into effect). Sunday work agreements made prior to the date of proclamation of the ESA 2000, will not be affected by s. 10(1) of O Reg 285/01.
An employee who is hired on or after September 4, 2001, who did not enter into an agreement at the time of hire to work on Sundays, will be able to decline work on Sundays. In addition, the fact that an employee establishes a pattern of working all, many or few Sundays does not compromise his or her right to refuse to work if there was no agreement to work Sundays made at the time of hiring.
Under s. 10(2) of O Reg 285/01, it is possible for an employee hired on or after September 4, 2001 to enter into an agreement at the time of hiring and yet subsequently refuse to work Sundays for religious reasons, provided the employee gives the appropriate 48 hours' notice before the commencement of each Sunday shift. Further information on the notice provisions is contained in the discussion of s. 73(3) below.
Section 10(3) of O Reg 285/01 prohibits an employer from making an agreement to work Sundays a prerequisite to hiring an employee where this requirement would be contrary to the "adverse effect" discrimination provisions contained in s. 11 of the Human Rights Code. "Adverse effect" or constructive discrimination can occur when a workplace practice unintentionally singles out particular persons, which results in their unequal treatment. An employer can, however, establish Sunday work as a condition of employment, provided it is not in violation of this section of the Human Rights Code.
As previously noted, the right to refuse Sunday work under s. 73(2) applies only to persons already working at an establishment (i.e., "an employee"), and therefore a person cannot make a complaint under the Act if he or she has not been hired because of a refusal to work on Sundays. The person may, however, have grounds for a complaint under the Human Rights Code and should be referred to Ontario’s Human Rights Legal Support Centre.
Finally, beyond the s. 73 rights to refuse work on Sundays and holidays, there is no general right under the Act of an employee to refuse to work on a particular day. However, if an employee refuses to work any other day because of bona fide religious beliefs, for example, he or she may have a complaint under the Human Rights Code. If such is the case, the employee should be referred to Ontario’s Human Rights Legal Support Centre.
Section 73(3) is similar in effect to s. 50.2(2) of the former Employment Standards Act. Section 73(3) provides that an employee who has agreed to work on a Sunday or holiday can subsequently decline to work, provided he or she notifies the employer 48 hours before he or she was to commence work that day.
However, the ability to refuse Sunday work with 48 hours' notice is subject to s. 10 of O Reg 285/01, which precludes employees who had agreed at the time of hiring (on or after September 4, 2001) from refusing to work Sundays except where the employee declines to work on the Sunday for religious reasons (s. 10(2) of O Reg 285/01), or where the agreement to work Sundays was a condition of being hired and such condition would be contrary to section 11 of the Human Rights Code (s. 10(3) of O Reg 285/01). In other words, an employee who had agreed at the time of hiring (on or after September 4, 2001) to work on Sundays could not subsequently refuse to work by providing 48 hours' notice of the refusal, unless s. 10(2) or s. 10(3) of O Reg 285/01 applied.footnote 6
The notice provision ensures that employees can exercise their rights of refusal while enabling the employer to find replacement employees. At the same time, the notice provision is sufficiently short that an employee with a sudden need for a period free from work on a public holiday or on a Sunday is not denied the right to refuse.
If an employee has previously agreed to work on a public holiday or a Sunday, he or she may subsequently refuse to work only if 48 hours’ notice is given as required by this section (and subject to the limitation on refusing Sunday work established by s. 10 of O Reg 285/01). If the employee gives less than 48 hours' notice or does not give notice at all, and he or she is penalized in some way for the refusal, then the employee has no recourse under the Act, even where the refusal was for religious reasons.
The notice to decline public holiday or Sunday work does not need to be in writing. Although not necessary, a written notice is of course preferable for evidence purposes in case of a claim.
The intention of Part XVIII (Reprisal) is to ensure that employees can pursue their rights under the Employment Standards Act, 2000 and participate in proceedings under the Act or s. 4 of the Retail Business Holidays Act, RSO 1990, c R.30 free from employer reprisal.
Subsection 74(1) prohibits employers and anyone acting on their behalf from taking reprisal action against employees for asking their employers to comply with the Employment Standards Act, 2000, making inquiries about their rights under the Act, filing a complaint under the Act, exercising or attempting to exercise their rights under the Act, giving information to an employment standards officer, making inquiries about or disclosing rate of pay in relation to compliance with Part XII of the Act (Equal Pay for Equal Work) or participating in proceedings under the Act or s. 4 of the Retail Business Holidays Act, RSO 1990, c R.30. In addition, it prohibits reprisals because an employee is or will be eligible to take, intends to take or takes a leave under Part XIV of the Act, or because the employee's wages are or may be subject to garnishment or a court order.
Under the ESA 2000 a reprisal contrary to s. 74 may result in the issuance of any or all of the following:
A reprisal, like any contravention of the Act, could also be the subject of a prosecution under the Provincial Offences Act, RSO 1990, c P.33.
The Program applies a four-step test for determining whether an employer, or a person acting on behalf of the employer has engaged in a reprisal contrary to s. 74(1). This four-step test is set out below:
If all four questions are answered in the affirmative, a breach of s. 74(1) is established. Note that s. 74(2) places the burden of proof on the employer in the context of an allegation of reprisal, except on review of a notice of contravention under s. 122. Each aspect of this test is discussed in more detail below.
The first determination that must be made is whether the person(s) against whom the allegation of reprisal is made is the employee's employer or a person acting on behalf of the employee's employer. There can be no violation of s. 74(1) if the person in question is not the employee's employer or a person acting on behalf of the employee's employer.
This first determination is made up of two parts: first, is the person who is making the allegation an "employee", and second, is the person whose actions are being complained of the "employer" or someone "acting on behalf of [the] employer".
Former employees
The definition of employee in ESA Part I, s. 1 includes a person who was an employee. Accordingly, an individual continues to be protected from reprisal by their former employer (and anyone acting on behalf of the former employer) even after the individual's employment has terminated. For example, employers are prohibited from giving negative job references for a former employee if the negative reference is given because the employee had asserted their ESA 2000 rights when employed by that employer.
Some support for this position may be inferred from the decision of the Ontario Labour Relations Board in Chafe v Home Base Non-Profit Housing, 2005 CanLII 9130 (ON LRB). In that case, the employee had filed a complaint under the Act that was dismissed by the investigating officer. After she began working for a new employer she received a letter from her former employer that referred to her complaint and that was critical of her, and which led her to believe that the former employer was attempting to jeopardize her new employment relationship. At that point, she applied for review of the officer's decision. Although the Board dismissed her application as being outside the 30-day appeal period, it noted that the former employer's actions were clearly linked to her complaint and suggested that if those actions continued it might constitute an illegal reprisal for having filed the complaint.
Job applicants
A job applicant will generally fail this step of the test because a job applicant is not an employee. The only exception is in the context of Part XVI, Lie Detectors. An expanded definition of employee in ESA Part XVI, s. 68 that applies only to Part XVI includes an applicant for employment. Accordingly, a job applicant will pass this first step of the test if the reprisal claim is based on the Lie Detectors provisions - see ESA Part XVI for a more detailed discussion of this issue.
The definition of "employer" is set out in ESA Part I, s. 1(1) as follows:
An employer is bound by the actions of those persons who act on its behalf. The phrase "person acting on behalf of the employer" is not a defined term. It is Program policy that this phrase be interpreted broadly. Program policy is that persons acting on behalf of an employer may therefore include the following:
Section 74(1) prohibits employers from intimidating, dismissing, otherwise penalizing employees or threatening to do so for enumerated reasons. Such conduct is considered a reprisal and contrary to s. 74(1). Some examples of employer conduct found to constitute a reprisal have included:
The meaning of "intimidate", "dismiss", "penalize" and "threaten" is discussed in greater detail below.
To intimidate is to compel someone, by causing fear in them, to do something or to refrain from doing something. Intimidation can range from the obvious, such as an employer making a public example of employees who have asked about their rights under their Act by terminating them, to the subtle, such as a campaign of veiled threats and innuendos designed to make the employee feel reluctant and fearful about enforcing their rights under the Act.
For example, a manager might tell employees, "The owner really hates it when you refuse to work extra hours. I would hate to get on his bad side."
For a discussion of prohibited employer actions in the context of attendance management programs and perfect attendance bonuses in relation to statutory leaves of absence, see ESA Part XIV, s. 52(1).
It is Program policy that intimidate is to be interpreted broadly.
To dismiss an employee is to terminate their employment. The term dismissal includes constructive dismissal.
Generally
The phrase "otherwise penalize" is very broad and will include any punishment or disadvantage imposed on an employee by an employer or a person acting on behalf of an employer. This includes all forms of discipline and any change in the terms and conditions of the employee's employment that are disadvantageous to them, such as lay-offs, pay cuts, reduction of hours, etc. It also includes harassment, such as, for example, where an employer repeatedly addresses an employee who refused to work excess hours as "clock watcher". Any conduct by the employer that has the effect of imposing a penalty (whether large or small) on an employee will come within the meaning of "otherwise penalize".
For a discussion of prohibited employer actions in the context of attendance management programs and perfect attendance bonuses in relation to statutory leaves of absence, see ESA Part XIV, s. 52(1).
Penalty imposed on someone other than the employee
One question that may arise is whether an employee is otherwise penalized if the employer punishes or imposes a disadvantage on someone other than the employee. It is Program policy that this is possible if the employer's action results in some kind of harm to the employee, whether it be economic, emotional, or has any other effect that harms the employee.
For example, if an employee and the employee's spouse worked for the same employer and the employer fired the employee's spouse because the employee had engaged in a protected activity under s. 74(1)(a), or the employee's wages were subject to garnishment or court order under s. 74(1)(b), the employer could be found to have reprised against the employee contrary to s. 74.
Another example is where the employer (Employer A) of an employee who exercised their ESA 2000 rights knows the employer (Employer B) of the employee's spouse. Employer A, wishing to penalize the employee for exercising their rights but wanting to avoid being in violation of the ESA 2000, contacts Employer B and arranges to have the employee's spouse fired. In this case, Employer A could be found to have penalized the employee who exercised their rights.
Withholding a reward or positive opportunity
A penalty can also include, depending on the circumstances, the withholding of a reward or the withholding of a positive opportunity. That is, there will be a penalty where opportunities or rewards are automatically denied to employees who have exercised a right by refusing to do something, or who have exercised a right by not volunteering to do something.
For example, opportunities to work overtime and, more importantly, to receive overtime pay are automatically denied to employees who sometimes exercise their right to refuse to work excess hours when requested, or to employees who have not volunteered to work excess hours.
Another example is where the employer puts employees who have exercised a right to not work excess hours at the bottom of the list of people to whom the offer of overtime is made.
A third example is where retail employees who do not volunteer to work Sundays are automatically passed over for promotion.
In all of these cases, the employer has imposed a penalty on the employees. A reward or a positive opportunity - overtime pay or a promotion in these examples - has been denied an employee because they exercised an ESA 2000 right. An employee missing out on a positive opportunity is the flip side of the employee having something negative imposed on them - they are both penalties.
Some might argue that employers are not penalizing employees by, for example, not offering weekend overtime opportunities to employees who refused to work excess hours during the week, or by not offering promotion opportunities to retail employees who refuse to work Sundays; they are just providing incentives to encourage employees to work excess hours or on Sundays. It is Program policy that there is nothing wrong with the offer of incentives or rewards for working additional hours. However, the incentive or reward must be made available to all employees; it cannot be denied to employees because they have exercised an ESA 2000 right. If the opportunity to receive the incentive or reward is denied to those employees, it is Program policy that they are being penalized.
Threaten to intimidate, dismiss or otherwise penalize
The prohibition against reprisal extends to threats by employers to intimidate, dismiss or otherwise penalize an employee. There is no need for an employer to actually intimidate, dismiss or otherwise penalize an employee for the employer's conduct to be captured by s. 74. All that is required is that the employer threatens the employee with intimidation, dismissal or another penalty.
For example, a threat to transfer an employee, where the transfer would or might be considered to be a demotion, or where the new job is less appealing to the employee, if the employee does not sign an agreement to average overtime would likely be considered a threat to penalize an employee, contrary to s. 74(1).
Another example is where a manager tells employees: "The owner really hates it when you refuse to work extra hours; I sure would hate to get on his bad side." Even if the employees were not actually deterred from exercising their right to refuse to work excess hours, this would likely be considered a threat to penalize, or a threat to intimidate, an employee, contrary to s. 74(1).
It is Program policy that before it can be said that the employer has committed one of the prohibited actions (i.e., dismiss, intimidate, otherwise penalize, or threaten to do any of those things), an element of intention must be established.
Where the employer takes an action with the aim of harming the employee, the element of intention is obviously met.
The necessary element of intention will also be met where an employer takes an action that is genuinely motivated by what it considers legitimate business reasons and not by any desire to cause harm or loss to the employee, but which the employer knows or ought to know will cause harm or loss to the employee.
For example, an employer transfers an employee who refuses to work excess hours from one position to another, because in the employee's original position a refusal to work excess hours hampers the achievement of production goals, but the new position is not nearly as sensitive in that respect. If the new job is one that the employer knew or ought to have known is one that the employee would find significantly less appealing, it does not matter that the employer's motive was not to harm the employee; it is sufficient that the employee did in fact suffer a loss.
The test is whether the employer knew or ought to have known. An employer is presumed to know the natural consequences of its actions; it is no defence for the employer to say that it never turned its mind to whether its action would have a negative impact on the employee. It is Program policy that if the employer had turned its mind to that question it would have realized that there would be a negative impact on the employee, the element of intention is met. Employers cannot avoid liability by not thinking about the consequences for the employee of actions taken in response to the employee's exercise of their right.
The "ought to have known" part of the "knew or ought to have known" tests means that an employer could be seen as having the requisite intent, even if it was not aware of the impact that its action would have on the employee. However, an employer cannot be expected to have perceived the possibility of a negative impact where such impact is based wholly on eccentric preferences or unusual reactions on the part of the employee.
For example, if a single employee with no childcare responsibilities is transferred from one job to another and the only difference between the two jobs is that the employee will start their eight-hour shift one hour earlier and the employee has an unusually intense dislike for rising early in the morning, generally that will not meet the element of intention. The employer could not reasonably have been expected to know the employee had an extreme aversion to getting up early. On the other hand, if the employer knew prior to transferring the employee that the employee had such an intense dislike, the requisite element of intent will be met, because the employer knew.
For the third part of the test to be met, the employee must have engaged in one or more of the protected activities set out or the employer must have been required because of a court order or garnishment to pay money owing to the employee over to a third party:
If the employee did not engage in one of the protected activities or there was no such court order or garnishment, the employee is not protected by s. 74 against reprisal. Each protected activity is discussed in detail below.
An employee is protected from reprisal by their current employer with respect to the activities listed in subparagraphs (a)(ii) through (viii) even if the employee was not employed by the current employer when the employee engaged in the activity. For example, an employer is prohibited from taking reprisal action against an employee because the employee filed a complaint against their former employer.
Section 74(1)(a)(i) prohibits an employer and a person acting on behalf of an employer from intimidating, dismissing or otherwise penalizing an employee or threatening to do so because the employee has asked the employer to comply with the Act or the regulations.
It is Program policy that the protected activities under s. 74(1)(a)(i) must be broadly interpreted. Generally speaking, any activity in which the employee's objective is to get the employer to comply with the Act or regulations should be seen as being protected activities. These include but are not limited to:
Section 74(1)(a)(ii) provides that it is a contravention of s. 74(1) for an employer or a person acting on behalf of an employer to intimidate, dismiss or otherwise penalize an employee, or threaten to do so, for making inquiries about their rights under the Act.
It is Program policy that the protected activity under s. 74(1)(a)(ii) must be broadly interpreted. Generally speaking, any inquiry made by the employee with the objective of finding out what their rights are under the Act, regardless of to whom the inquiry is directed, should be seen as a protected activity. This would include but is not limited to:
Section 74(1(a)(iii) provides that it is a contravention of s. 74(1) for an employer, or a person acting on behalf of an employer, to intimidate, dismiss or otherwise penalize an employee, or threaten to do so, for filing a complaint under this Act. See ESA Part XXII, s. 96(1) for a discussion of the provisions for filing a complaint under the Act.
It is Program policy that the protected activity under s. 74(1)(a)(iii) must be broadly interpreted. Accordingly, there will be protection for an employee under this clause even if the employee tries to file a complaint but uses the wrong form, or files a complaint more than two years after the violation, which, pursuant to s. 96(3), means that it is deemed not to have been filed.
Section 74(1)(a)(iv) provides that it is a contravention of s. 74(1) for an employer or a person acting on behalf of an employer to intimidate, dismiss or otherwise penalize an employee, or threaten to do so, for exercising or attempting to exercise a right under this Act. This includes, for example, an employee refusing to agree to average hours of work for the purpose of calculating overtime, or attempting to revoke with two weeks' notice an agreement to work excess hours.
This provision will only apply where the employee is exercising or attempting to exercise a right under the ESA 2000. This provision would not apply if the employee is exercising a right under another statute or their contract of employment that is not otherwise a right nor an enforceable greater right or benefit under the ESA 2000.
For example, an employee regularly works 44 hours in a work week. The employee refuses his employer's request that he work an additional four hours in the work week. The employee receives a letter of discipline for his refusal and he alleges that his employer has committed a reprisal against him. The employer's conduct cannot constitute a reprisal within the meaning of s. 74(1)(a)(iv) because the employee was not exercising or attempting to exercise a right under the Act. Employees have no right under the Act to refuse to work hours in addition to their regular work week if the additional hours would not result in them working more than the applicable daily limit on the day in question or more than 48 hours in the work week in question.
Another example deals with direct deposit. Section 11(4) of the Act permits employers to pay wages by direct deposit if certain conditions are met, such as there being an account in the employee's name. While the employee's agreement to be paid by direct deposit is not required by the ESA 2000, for practical reasons an employee's agreement is necessary as banks do not permit employers to open an account on behalf of an employee. Accordingly, employees who do not wish to be paid by direct deposit can prevent an employer from paying their wages in that manner by refusing to open an account. As it is often more expensive and administratively cumbersome to pay wages by cheque, employers may threaten or penalize employees who do not open an account. It is the Program's view that ESA Part V, s. 11(4) does not grant employees a right to not be paid by direct deposit; it merely sets out conditions that have to be met in order for direct deposit to be permitted under the Act. Accordingly, employees who refuse to open an account so as to prevent an employer from paying them by direct deposit are not exercising a right under this Act, and therefore are not protected from reprisal.
Another situation deals with sick leave. For example, an employee is absent from work and asserts a right to sick leave, but it is subsequently revealed that the employee was not telling the truth and did not in fact have a right to be absent. The employer is not prohibited by s. 74 from penalizing the employee because the employee was not exercising or attempting to exercise a right under this Act; they did not have a right to take a sick leave.
On the other hand, refusing to sign an authorization allowing a deduction from wages pursuant to s. 13(3) is a protected activity. For example, an employer wants an employee to authorize a deduction from wages that is not one that is prohibited by s. 13(5), the employee refuses, and the employer terminates the employee's employment in response. It is Program policy that the employee, in refusing to provide their authorization, engaged in a protected activity, and the employer would therefore be in violation of s. 74. The difference between this situation and the direct deposit example above is that in this case, the essential condition for making the deduction - the employee's authorization - is set out in the Act. In the direct deposit example, the employee's agreement is not a condition that is set out in the Act. Although the employee's agreement will, as a practical matter, have to be obtained in order for the employer to be able to pay by direct deposit. That is a function of the policies of banks and other financial institutions. It is not a requirement of the Act.
Another example is the issue of whether an employee is engaging in a protected activity if the employee fails to give advance notice that he or she is going to take a sick leave, family responsibility leave or a bereavement leave. For a detailed discussion of this issue, see ss. 50(3) and (4) [sick leave], ss. 50.0.1(4) and (5) [family responsibility leave] and ss. 50.0.2(4) and (5) [bereavement leave].
Rights under the ESA 2000 include withdrawing from agreements to give up the default employment standard and receive the entitlements under the alternate employment standard. For example, the default employment standard with respect to meal breaks is to receive an eating period of at least 30 minutes, but employees can agree to the "alternate" employment standard of two shorter eating periods that together total at least 30 minutes. In most cases, employees are entitled to revoke their agreement to the alternate standard and revert back to the default standard, and doing so is a protected activity under this clause. If an employer penalizes an employee because the employee withdrew their agreement, that will be a violation of s. 74.
There are some situations where an employee's ability to revoke an agreement is restricted. For example, an employee can revoke an excess hours agreement only if they give the employer two weeks' written notice. If, during the time when the employee is prevented from revoking the agreement, the employee purports to revoke the agreement and attempts to rely on the default employment standard, the employee cannot be said to be exercising a right under the Act because the employee was purporting to exercise the right at a time when the Act did not in fact give them the right; the employee therefore will not be protected from reprisal. Other examples where the employee's ability to revoke an agreement to the alternate standard is restricted include:
It is Program policy that the protection of this clause applies in cases where an employer dismisses, intimidates, penalizes or threatens to do so because it wants to prevent an employee from exercising or attempting to exercise a right under the ESA 2000, even if the employee has not actually exercised or attempted to exercise a right.
For example, one employee asserts their right to receive public holiday pay. The employer terminates that employee, then convenes a meeting of all the other employees and threatens them by telling them that if anyone else tries to get their public holiday pay they too will be fired. Even though none of the other employees has actually exercised or attempted to exercise their right to public holiday pay, this clause will apply to them, so if they file a reprisal claim they will pass step 3 of the test. To take the opposite view would defeat the intention of s. 74 which is to ensure employees can freely exercise their ESA 2000 rights. It would also permit an absurd result where an employer could avoid liability by pre-emptively threatening employees with dismissal on their first day of employment and every day thereafter. If the Program were to take the view that protection only applies once an employee actually exercises or attempts to exercise a right, then employers who are successful in intimidating employees out of ever exercising or attempting to exercise a right would not ever be found to have violated s. 74.
It is Program policy that the protected activity under s. 74(1)(a)(iv) must be broadly interpreted.
Section 74(1)(a)(v) prohibits an employer from intimidating, dismissing or otherwise penalizing an employee, or threatening to do so, for giving information to an employment standards officer.
It is Program policy that this provision must be interpreted broadly. Protected activities under this provision include but are not limited to:
The Fair Workplaces, Better Jobs Act, 2017, SO 2017, amended the ESA to include s. 74(1)(a)(v.1), effective April 1, 2018. Section 74(1)(a)(v.1) prohibits an employer from reprising against an employee who makes inquiries about the rate paid to another employee for the purpose of determining, or assisting another person in determining, whether an employer is complying with the equal pay for equal work provisions in ESA Part XII.
For example, employee A may ask fellow employee B about his or her rate of pay in order to determine whether employee A is receiving the same rate of pay for equal work, pursuant to section 42, Part XII. An employer is prohibited from reprising against employee A for making this inquiry.
Effective January 1, 2019, the Making Ontario Open for Business Act repealed s. 42.1 which provided equal pay for equal work on the basis on employment status. The question might arise as to what reprisal protection exists in relation to this repealed provision. Section 74(1)(a)(v.1) provides protection against reprisal where an employee made inquiries about the rate that was paid to another employee both during the timeframe that s. 42.1 was in effect (from April 1, 2018 to December 31, 2018) and after its repeal where the purpose of the inquiries is to determine, or to assist another person in determining, whether an employer was in compliance with section 42.1. In other words, the specified inquiries are protected regardless of when they occurred, as long as they relate to a rate that was paid when s. 42.1 was in force (from April 1, 2018 to December 31, 2018).
The Fair Workplaces, Better Jobs Act, 2017, SO 2017, amended the ESA to include s. 74(1)(a)(v.2), effective April 1, 2018. Section 74(1)(a)(v.2) prohibits an employer from reprising against an employee who discloses his or her rate of pay to another employee for the purpose of determining, or assisting another person in determining, whether an employer is complying with the equal pay for equal work provisions in section 42, Part XII.
For example, employee A may divulge his or her rate of pay to employee B to assist employee B in determining whether she is receiving the same rate of pay for equal work, pursuant to Part XII. An employer is prohibited from reprising against employee A for disclosing this information. Note that if employee B also divulged his or her wage rate to employee A as part of this discussion, the employer is equally prohibited from reprising against employee B.
Effective January 1, 2019, the Making Ontario Open for Business Act repealed s. 42.1 which provided equal pay for equal work on the basis on employment status. The question might arise as to what reprisal protection exists in relation to this repealed provision. Section 74(1)(a)(v.2) provides protection against reprisal where an employee discloses his or her rate of pay to another employee both during the timeframe that s. 42.1 was in effect (from April 1, 2018 to December 31, 2018) and after its repeal where the purpose of the disclosure is to determine, or to assist another person in determining, whether an employer was in compliance with section 42.1.
In other words, the specified disclosure is protected regardless of when it occurred, as long as it relates to a rate that was paid when s. 42.1 was in force (from April 1, 2018 to December 31, 2018).
Section 74(1)(a)(vi) prohibits an employer from intimidating, dismissing or otherwise penalizing an employee, or threatening to do so, for testifying, being required to testify or otherwise participating in a proceeding under the Act.
It is Program policy that this section must be interpreted broadly. Protected activities under this section include but are not limited to situations in which the employee is:
It is irrelevant to the application of this section whether the employee's participation is voluntary.
The Retail Business Holidays Act (“RBHA”) prohibits most retail stores from opening on holidays as defined in that Act. However, s. 4 of the RBHA establishes a process for making representations at municipal councils regarding existing or proposed tourism exemption by-laws. Section 74(1)(a)(vii) provides protection against reprisal for those employees who participate in this process.
It is Program policy that this section must be interpreted broadly. Protected activities under this section include but are not limited to participation as a:
Although participation in this type of a proceeding would almost always be voluntary, it is, as with the protection accorded to participation in proceedings under the Act by s. 74(1)(a)(vi), irrelevant whether the employee's participation is voluntary.
Section 74(1)(a)(viii) provides protection for employees who are intimidated, dismissed or otherwise penalized or threatened with intimidation, dismissal or other penalties because of the following situations.
An employee who qualifies for protection under this provision may also have rights under the Human Rights Code that have been violated, in that they may have been discriminated against because of sex (which includes pregnancy) or family status. Therefore, the claimant may wish to contact Ontario's Human Rights Legal Support Centre in addition to filing a claim with the Ministry of Labour.
Employee is eligible to take a Part XIV leave
This includes pregnancy, parental, family medical, organ donor, family caregiver, critically illness, child death, crime-related child disappearance, domestic or sexual violence, sick, family responsibility, bereavement, declared emergency, or reservist leave.
For example, an employee's spouse has just given birth. The employee is eligible for parental leave as a new parent but has not yet decided whether he will be taking the leave.
Employee will become eligible to take a Part XIV leave
For example, an employee who has just discovered that she is pregnant will be eligible for pregnancy leave when she is within 17 weeks of her due date and therefore has protection under this section.
For example, in 832746 Ontario Ltd. v Fuller, 2001 CanLII 11289 (ON LRB) the employer terminated the employment of the claimant when she was seven months' pregnant because the employer did not want a pregnant woman working in his bar. The Board found that this was a violation of s. 44 of the former Employment Standards Act, which prohibited an employer from penalizing an employee because she was eligible for leave; the employee was eligible for the leave because of her pregnancy, and terminating the employee's employment because she was pregnant was therefore a violation of the former Employment Standards Act. Further, although the Board recognized an overlap between the protections afforded under the Human Rights Code, RSO 1990, c H.19 and the ESA, it concluded there was no reason to defer the complaint under the Act to the Human Rights Code. In this regard, see also Bazinet v Thain Industries Ltd., 2004 CanLII 24706 in which the Board noted that assuming the employer is in fact aware of the employee's pregnancy, it must demonstrate that the pregnancy was not a factor in its decision to terminate her employment.
Employee intends to take a Part XIV leave
For example, an employee who is terminated by her employer because she has told other employees that she is attempting to get pregnant and will be taking her full leave entitlement if she is successful would be protected under this section.
Another example is an employee who tells his employer that he will be taking three days of sick leave for surgery that is scheduled for a date four months hence.
A third example is an employee whose mother is terminally ill and who indicates that he will be taking family caregiver leave and family medical leave in the near future.
Employee takes a Part XIV leave
This will obviously also include an employee who "took" a Part XIV leave. That is, after the leave is over, an employer is prohibited from penalizing the employee because the employee took a leave.
Section 74(1)(b) prohibits any employer or a person acting on behalf of an employer from intimidating, dismissing or otherwise penalizing an employee, or threatening to do so, because the employee's wages are the subject of a garnishment or a court-ordered payment to a third party.
Section 7 of the Wages Act, RSO 1990, c W.1, deals with garnishment of wages, as defined therein, and stipulates that 80 per cent of a person's net wages are exempt from garnishment. For purposes of the Wages Act, net wages equal gross wages less statutory deductions such as income tax, employment insurance and Canada Pension Plan; only deductions authorized by a statute reduce "gross wages" to "net wages". Other deductions, even if properly authorized in writing by the employee, cannot be used to reduce the amount of gross wages for purposes of the Wages Act restrictions. If the garnishment is for the enforcement of a support order, the Wages Act exempts only 50 per cent of the person's net wages. Nevertheless, the judge issuing the order may use their discretion to decrease the exemption, if the creditor so requests, or increase them, if the debtor so requests. The 50 per cent restriction (with possibility of variation) is also found in the Family Responsibility and Support Arrears Enforcement Act, 1996, SO 1996, c 31.
No specific advice concerning the Wages Act or the Family Responsibility and Support Arrears Enforcement Act, 1996 should be given by an employment standards officer. The Wages Act is administered by the Ministry of the Attorney General, and enquiries concerning it may be directed to Crown Law Office - Civil of that ministry. The Family Responsibility and Support Arrears Enforcement Act, 1996 is administered by the Ministry of Community and Social Services, and enquiries concerning it may be directed to the Family Responsibility Office of that ministry.
Sections 74(1)(a) and 74(1)(b) prohibit employers and persons acting on behalf of employers from intimidating, dismissing, or otherwise penalizing employees because the employee engaged in the activities listed in 74(1)(a) or because the employee's wages were subject to garnishment or court order as per s. 74(1)(b). Further, a contravention of s. 74 is established if the employer (or person acting on behalf of the employer) was motivated, even partly, to intimidate, dismiss or otherwise penalize an employee because the employee engaged in one or more of the protected activities listed in s. 74(1)(a) or (b). For example, an employer that terminated the employment of an employee both because of serious absenteeism and because the employee routinely refused to work in excess of 48 hours in a work week could be found to have contravened s. 74.
The use of the word because necessitates a consideration of the employer's motivation in taking the action it has taken against the employee. In the context of the exercise of rights to leave in s. 74(1)(a)(viii) for example, the employee is only protected from intimidation, dismissal or other penalties or threats thereof that are motivated by the rights to a Part XIV leave.
In 384093 Ontario Limited operating as Goodyear Tire Centre v Dietzal (December 18, 1981), ESC 1142 (Hunter), a decision under the former Employment Standards Act, an employee had been dismissed when the president of the employer, after having met with an employee whose wages were the subject of a garnishment order issued against it to discuss his displeasure with the employee's "financial irresponsibility", discovered that the employee had not disclosed to him the existence of two earlier garnishment orders. The employer argued that the employee had been dismissed not because of the garnishment orders per se, but rather, because of the employee's lack of candour in not apprising the president of the previous orders. The referee found that the issuance of the orders was the motivation for dismissal and that the dismissal was accordingly unlawful, as being a breach of the predecessor to the current s 74(1)(b). Commenting on the employer's argument that the employee had a duty to disclose the existence of the earlier orders, the referee suggested that even if there was such a duty on the employee, dismissal because of the issuance of a garnishment order was still unlawful.
The question arises as to whether a reprisal is committed where an employer commences a civil action against an employee who has filed an employment standards claim with the Ministry of Labour, in response to that claim and in an attempt to recoup any monies the employee has been or may be awarded through the Ministry.
For example, an employer made a deduction from the wages of an employee because the employee damaged the employer's equipment. The employee filed an employment standards claim, and the officer, finding that the deduction was unlawful, ordered the employer to pay the money back to the employee. In response, the employer sues the employee, claiming that the employee was negligent in the handling of the employer's equipment.
When determining whether a reprisal has been committed, consideration must be given to the motivation behind the civil action. For example, an employer may sue an employee because of a desire to punish the employee for having filed a claim - this is likely to constitute a reprisal. Or, an employer may simply be attempting to recover what is rightfully the employer's by law – this is unlikely to constitute a reprisal. The commencement of a civil action will not generally constitute a reprisal, however, circumstances may arise that lead to the opposite conclusion. Officers who are considering finding a reprisal arising from the commencement of a civil action should consult with the Employment Practices Branch prior to making a determination on the issue of a potential reprisal.
It may be necessary for employment standards officers to rely on circumstantial evidence to establish an employer's motivation under s. 74. Accordingly, employment standards officers may have to draw inferences about employer motivation. Whether the requisite intent is established is a factual determination and it will necessarily turn on the circumstances of each case. Note that s. 74(2), subject to s. 122(4), places the burden of proof on the employer in the context of an allegation of reprisal.
Factors that may be relevant to the employment standards officer's determination regarding employer motivation include the following:
If the employer was not aware, this step of the test cannot be met. An employer cannot be said to have done something "because" an employee engaged in a protected activity if the employer is not even aware that the employee engaged in it. Note, however, that the mere fact that the employer was aware that the employee had engaged in a protected activity, without more, is not enough to establish a violation.
For example, an employee is fired shortly after testifying against an employer at a hearing convened under the Act. However, just because the employer's conduct followed closely on the heels of the employee's protected activity does not necessarily mean that the employer did what it did because the employee engaged in the protected activity. A short interval of time in between the two events may obviously raise suspicions, but that is only one factor.
Conversely, just because a long period of time has elapsed between the employee's protected activity and the employer's action does not necessarily mean that the employer did not take its action because of the employee's activity, as an employer may try to disguise a reprisal by waiting some time before taking any action against the employee.
For example, if the employer has been inconsistent, unreasonable or unduly harsh with the employee.
This includes seasonal business patterns, the finances of the employer, changes in the organizational structure of the employer that do not appear directed at the employee in particular, technological changes, etc. However, just because there may be compelling business reasons does not necessarily mean that a reprisal has not been committed, as there could also be unlawful reasons for the employer's conduct.
Further, if the employer took certain action because the employee exercised their rights, the fact that the action was taken because the employee's exercise of those rights created business problems does not mean that a reprisal did not take place. That is, even if the employer's motivation was not to affect the employee detrimentally, so long as the employer knew or ought to have known that its actions would affect the employee detrimentally, and those actions were taken because the employee exercised their rights, the employer has engaged in a reprisal.
Where a contravention of Part XVIII (Reprisal) has occurred, s. 104 empowers an employment standards officer to issue an order requiring that the employee be compensated and/or reinstated. In addition, if an applicant for employment has been reprised against (i.e., not hired) because they refused to take a lie detector test, an order to hire the applicant may be issued.
An order for reinstatement may be appropriate where the employer has terminated the employee's employment in contravention of s. 74. Reinstatement is considered as a possible remedy in every case where there has been a termination. Where an officer decides that reinstatement is not an appropriate remedy, the narrative should set out the reasons for that decision. When considering whether an order for reinstatement is appropriate in the circumstances, an employment standards officer should consider the following factors:
If the employer is opposed to reinstatement, careful consideration of the circumstances should be had before reinstatement is ordered, since the purpose of a reinstatement order is likely to be defeated over the long-term if it is made in spite of the employer's adamant opposition. Nevertheless, there may be cases in which an order for reinstatement is still appropriate, notwithstanding the employer's position.
Similarly, an employee's desire to not be reinstated does not dictate the officer's decision. In some circumstances, it may be appropriate for an officer to issue a reinstatement order even though the employee does not wish to be reinstated. In situations where an officer decides that a reinstatement order is appropriate, but the employee refuses to accept reinstatement, it may be that no compensation is awarded under the head of damages for loss of reasonable expectation of continued employment.
It is Program policy that an order for reinstatement under s. 104(1) should require the employer to reinstate the employee to the position that they most recently held, or, if and only if the employee's former position no longer exists, to a comparable position. This policy position is based, by analogy, on the principles behind the reinstatement obligations set out in ESA Part XIV, s. 53(1) following a Part XIV leave.
If an order for reinstatement is made, an employee will be reinstated to the position that they most recently held - if that position still exists. If the job is still there and if the same work is being done, the employee should be reinstated to perform the same work. This is so irrespective of whether another person is now and has been performing the job.
If the position most recently held by the employee no longer exists, the employee may be reinstated to a comparable position. The question of what constitutes a comparable position is a factual matter that will vary with the circumstances of each case. A position with the same wages and benefits is not necessarily comparable - see C.L.C. (Can Workers' Union, Local 354) v American Can Canada Inc., 1983 CanLII 935 (ON LRB). Rather, one must look at a number of factors, including all the aspects of the new, allegedly comparable job that might make it more or less appealing, objectively speaking, in the eyes of an employee in a similar position to that of the claimant, than the claimant's original job.
In making a determination as to what is a comparable position, it is helpful to refer to the factors set out in C.L.C. (Can Workers' Union, Local 354) v American Can Canada Inc., a case dealing with the question of what is comparable work under Part XI Pregnancy and Parental Leave of the former Employment Standards Act. The factors have been adopted by the Program as policy in dealing the question of what is a "comparable position" under the current Act, and are as follows:
If the position offered by the employer exists in another city or town, the position may or may not be comparable. For example, if commuting would be impossible or would involve a substantial increase in travel time, the position is unlikely to be comparable. In determining whether the position is comparable, the officer should consider the circumstances of the employee in question. The test to be applied is how a reasonable person in the employee's circumstances would view the change. For example, commuting may be possible for an employee with a driver's license, but impossible for an employee without one.
It should also be noted that even if the employment contract permitted the employer to transfer the employee to another city and that therefore (assuming no negative changes in the terms and conditions of employment) the transfer would constitute reasonable alternative employment for the purposes of O Reg 288/01, s. 2(1) para 5, it does not necessarily mean that the obligation to reinstate the employee to a comparable position under this section has been satisfied.
Including time of the day and the length of the working day; any shift or weekend work.
Office vs. warehouse vs. store vs. factory; degree of luxury; overall atmosphere; privacy vs. group surroundings; comfortable vs. spartan conditions.
Including the degree of independence and supervision; degree of initiative required; decision-making authority; ability to input own taste or influence; job satisfaction, etc.
What was/is the likelihood of the job continuing to exist and the opportunity to progress from that job to a higher position; relationship between the employee's background, training and education and the requirements of the job; what are the skills required for advancement in each position?
Atmosphere and trappings of an executive, including own office, name and title on an organization chart; personal or position profile, such as opportunities for broader contact with other management personnel; own business card, expense account, administrative assistant; signing authority; social privileges; immediate supervision or instruction of others.
The importance and weight to be given to each of the foregoing factors will vary from case to case, depending on the particular facts in each situation. The new position may not be quite as attractive as the old job in all respects, but so long as, all things considered, it is at least as good if not better than the job the employee had before they had their employment terminated, it will be considered comparable. A test of what is comparable is an objective test, based on what a reasonable employee in the same circumstances as those of the employee would think.
In C.L.C. (Can Workers' Union, Local 354) v American Can Canada Inc. the employee claimed that she had not been reinstated to a position involving comparable work following her return from leave. Prior to her leave, the employee had held an executive position as communication co-ordinator. Upon her return from leave she was given alternative work. The alternative work involved mainly clerical tasks. Although she incurred no loss in wages, benefits or seniority, her new position involved a marked decrease in the degree of responsibility, prestige and perquisites as well as a loss in job security. In addition, her working environment, originally in a private office with access to a personal secretary, deteriorated to a secretarial corner. In light of the foregoing, it was found that the new position did not involve work of a comparable nature and compensation/reinstatement was ordered.
A pre-existing job evaluation system purporting to show equality as between two positions may be relevant but is not determinative of the comparability of the two positions. As the referee in Reed Inc. v Nidd (December 23, 1986), ESC 2002 (Mitchnick) stated, the evaluation system may be relevant as an objective factor. However, subjective factors such as humiliation, embarrassment and loss of prestige must be taken into account as well, but from an objective viewpoint. In other words, for example, would a reasonable employee have felt humiliated in the circumstances?
Furthermore, it may not be sufficient merely to offer the same wage where the wage range of the new position is inferior. For example, a new position at $25,000 per year at a $20,000 to $25,000 range may not be considered comparable to the wage of $25,000 at the former position at a range of $24,000 to $29,000.
To illustrate further, in Bronson Bakery Ltd v Melo and Scott neither the somewhat lesser degree of responsibility nor the minor variance of hours of work were sufficient of themselves to render the two jobs incomparable. The significant reductions in prestige and quality of working environment were the determining factors in finding the employer in breach of the reinstatement requirements.
Although there may appear to be a great deal of emphasis on the employee's feelings towards these factors, the test is objective; that is, how would a reasonable employee in the same circumstances have felt?
For example, in C.L.C. (Can Workers' Union, Local 354) v American Can Canada Inc.Referee Picher indicated that the employee found the change of geographical location (from Etobicoke to Brampton) significant, but he felt that there was no substantial difference on that issue alone and particularly so in light of the fact that the new position may have been even closer to her residence. However, he saw that her concerns on the issue of location were in fact more related to quality of working environment and the positions were clearly not comparable in that respect. The matter is more directly dealt with in Bronson Bakery Ltd v Melo and Scott where the employee was reinstated to a retail position as opposed to her previous office position. The employer argued that most people would prefer the open environment of the store and dealing with the public, and thus submitted that most people would have a different subjective preference from the claimant. However, Referee Fraser found that her viewpoint had a reasonable objective basis, i.e., most people would prefer office work to retail. Accordingly, there should be a reasonable objective basis for a subjective viewpoint on the factors considered.
The duty to mitigate losses requires the claimant to take necessary steps to reduce their losses arising from the loss of their job. If an employee neglects to mitigate their loss, the amount of compensation should be reduced. See the sections below for discussion of how the duty to mitigate applies to the different heads of damages.
Direct earnings loss, or direct wages loss, measures the loss of wages from the date of the reprisal. This head of damages may be appropriate in the context of an order for compensation or compensation and reinstatement where the employee has been terminated or subject to some form or reprisal resulting in actual earnings loss (e.g., a temporary lay-off or a reduction in hours of work). Damages in respect of a direct earnings loss may also be appropriate in circumstances where an employee suffered a reduction in hours or pay or has been denied the opportunity to earn tips, premium pay or overtime. These damages are subject to a duty to mitigate.
Vacation pay is payable on damages awarded under this head where the damages are for lost "wages" as defined in the Act. Therefore, vacation pay would be payable on the lost overtime pay in the example given in the preceding paragraph, but not on amounts included in the calculation of vacation pay, e.g., tips. For example, where an employee's employment is terminated prior to the commencement of a Part XIV leave, the direct earnings loss would be the wages (plus vacation pay) and any non-wage earnings the employee would have earned between the date of dismissal and the date that the leave should have begun. Employees in such circumstances will also be entitled to any supplementary or top up benefits that the employer would have provided during the leave had the employee's employment not been terminated in contravention of s. 74. Compensation for earnings that would have been earned after the date the employee should have been reinstated is dealt with under heading (2).
For example, if an employer ceased to schedule any hours between 44 and 48 in a week for an employee because they refused to sign an agreement to work more than 48 hours a week, the compensation order could include the overtime pay the employee would have earned between the date the reprisal action commenced and the date such action ceased.
An award is made under this heading only where the employer's reprisal takes the form of a refusal to reinstate an employee after a Part XIV leave and a reinstatement order has been issued. It is intended to compensate the employee for earnings that would have been earned between the date the employee should have been reinstated and the actual date of reinstatement. See for example James v Craiglee Nursing Home, 2004 CanLII 30948 (ON LRB).
Where a reinstatement order is issued in addition to a compensation order, a practical question arises: should the amount of compensation reflect the losses only to the date the reinstatement order is issued, or should it also reflect the reality that some time will elapse after the reinstatement order is issued and before the employee is actually reinstated? Employment standards officers usually inform employers of their intention to issue a reinstatement order, and allow the employer an opportunity to set a realistic date for the reinstatement. If the employer is agreeable to reinstatement and sets a realistic date, the compensation order would reflect the proposed reinstatement date.
If, on the other hand, the employer was not prepared to discuss a date for reinstatement, officers may issue a reinstatement order that is to be effective the date the order is issued, and award compensation calculated as if the reinstatement would take place on that date. If the employer applies to the Ontario Labour Relations Board to review the order, the Board has the authority to adjust the amount of compensation.
The amount of compensation would take into account the employee's duty to mitigate their losses. For instance, where an employee was only able to find a position prior to being properly reinstated, with fewer hours or a lower rate of pay, they should be compensated for the difference between actual earnings and what would have been earned had they been properly reinstated. See James v Craiglee Nursing Home, 2004 CanLII 30948 (ON LRB).
The amount of the award under this head could also be reduced where the employee failed to make efforts to mitigate their damages. In Rainbow Concrete Industries Limited v. Lentir, 2012 CanLII 58233 (ON LRB)the Board found that the claimant did not make reasonable efforts to mitigate his damages because his job search was inadequate. As a result, the Board reduced the amount of pre-reinstatement damages awarded to the claimant.
An award is made under this heading only where the reprisal has resulted in the employee's termination and no reinstatement order is issued. It is Program policy that an employee is entitled to either:
or
whichever is greater.
If the award is for damages in respect of time required to find a new job, this amount will be reflected in the compensation order issued under s. 104.
If however, the officer is issuing an order for termination pay, that amount (plus vacation pay on the termination pay) will be reflected in an order to pay wages made under s. 103. Such an order is subject to the limitations on recovery under s. 111.
The calculation of the time it would take to find a job begins with the week in which the employee was either given notice of termination or was terminated without notice. Note that if the employment was terminated during a leave under Part XIV of the Act, the calculation begins with the week in which the leave would have ended.
For example, an employee had three years of employment and, in contravention of s. 74, was fired without notice for refusing to work excess hours. The employment standards officer determined that it should have taken the employee four weeks to find a new job.
Under this heading, the employee would be entitled to an amount equivalent to four weeks of their earnings, including earnings that are not defined as wages under the Act, and including vacation pay on those earnings that are wages as defined in the Act rather than the three weeks of termination pay in lieu of notice to which they would be entitled under ESA Part XV. This amount would be awarded as damages in a compensation order issued under s. 104.
However, if the employment standards officer had determined that it should have taken the employee only two weeks to find a new job, the officer would instead award the three weeks' termination pay in lieu of notice to which the employee would be entitled under ESA Part XV. This amount would be ordered under s. 103 as unpaid wages.
While the amount assessed under this heading is not limited to an amount that would be awarded in respect of "reasonable notice" by the courts under the common law, any amount received by the employee with respect to their common law notice rights would be deducted from the amount calculated under this head. However, if the amount received under the common law notice rights exceeded the amount calculated under this heading, the excess will not reduce the amounts assessed under other headings. This raises an issue about the general prohibition against employees engaging in duplicative proceedings. An employee is not prohibited from both suing for wrongful dismissal in the courts and filing a reprisal claim with the Employment Standards Program. This is because the s. 97(2) prohibition on duplicative proceedings does not apply to, among other types of claims, reprisal claims. See ESA Part XXII s. 97(2) for a full explanation of this principle.
This head of damages is only considered if the employee's employment is terminated and no reinstatement order is issued. Expenses incurred in seeking new employment include transportation costs in travelling to interviews and any other reasonable expenses; claimants should be advised to keep receipts. Any expenses that would have been incurred even if the employee had not been terminated are not included. For example, if the employee had childcare expenses during the period they were looking for another job, but would have incurred the same day care costs if they had remained at work, these costs will not be included in the order.
This head of damages is commonly referred to as compensation for loss of the job itself. Where reinstatement is not ordered because it is not possible, realistic or appropriate, damages may be awarded for the loss of reasonable expectation of employment. They compensate for the loss of the opportunity to continue to be employed, an opportunity that the employer’s wrongful act denied. These damages are prospective in nature, meaning it is necessary to assign a value to future unknown events. They are not subject to a duty to mitigate.
The concept behind this head of damages was set out in Wyeth-Ayerst Canada Inc. v Dowd (January 7, 1998), 2466-96-ES (ON LRB):
Adjudicators have generally awarded one month per year of service under this head of damages. See Rainbow Concrete Industries Limited v. Lentir, 2012 CanLII 58233 (ON LRB). However, it is Program policy that the following factors are considered when determining damages for loss of job:
Other specific factors to look at include the economic health of the industry or the particular employer. If it seemed likely that the claimant's job was not secure to begin with (either because the employer was in financial difficulties or because the claimant did not plan to stay with the employer for long), then the loss of expectation of continued employment would not be significant.
Where an officer feels that a reinstatement order is appropriate but the employee nevertheless refuses to accept reinstatement, then it may be that no compensation should be awarded under this head of damages.
One issue that has arisen is whether a reinstatement order is appropriate where an employee was unlawfully terminated, then found a better job and, primarily because of the better job, does not want to be reinstated to the former job. Is a reinstatement order appropriate in these circumstances such that if the employee refuses reinstatement they should be disentitled to damages under this heading? It is Program policy that where the employee's reason for not wanting to be reinstated is because they found a better job, the employee is acting reasonably, a reinstatement order may not be appropriate, and the employee therefore should be entitled to damages under this heading in these circumstances. To entirely disentitle an employee to damages under this head in these circumstances would reward an employer who has unlawfully dismissed an employee because the employee was effectively forced to find a new job as a result of the employer's unlawful act.
Further, if employees in these circumstances were to lose out on damages under this heading, the point of having this head of damages - the desirability of compensating employees for having been wrongfully deprived of a job to which, by law, they were entitled - would be defeated. However, if the claimant has found another job, the nature of this job should be considered. If it is a better one, pays more and is more secure, then this fact should be considered in assessing the amount. In other words, while the fact that the employee ended up in some ways better off does not mean that nothing should be assessed under this head, it may result in a smaller amount being assessed than would have been the case had they ended up worse off or neither better nor worse off.
In Kingston Independent Nylon Workers Union v Page, a decision under the current Act, the Board noted that in mitigating her damages, the employee had actually found a better job than the one she had with her former employer. As a result, the Board held that the employee needed no compensation for "loss of the job". It assessed $0 under that heading, although the Board did increase the award under the heading "time required to find a new job" to take into account the actual amount of time it took her to find the job.
Also see the following cases decided under the former Act with respect to compensation for loss of reasonable expectation of continued employment or "loss of the job":
This head of damages is intended to compensate for such things as the humiliation and real hurt suffered by a person terminated in violation of the ESA 2000. This head may be considered in all circumstances in which a breach of s. 74 is alleged. Together with compensation for the loss of the reasonable expectation of continued employment, this head of damages is one of the most difficult to quantify. This head of damages is not subject to the duty to mitigate.
Some type of evidence is necessary to support an award of compensation for emotional or mental pain and suffering. In many cases, oral evidence from the employee attesting to their emotional pain and suffering will be adequate to support an award under this heading. In cases where a higher amount of damages is awarded under this heading, evidence in addition to the oral evidence, such as a medical report, may be necessary to support the higher award.
In Rainbow Concrete v Lentir,the claimant provided evidence that he experienced a great deal of emotional pain and suffering as a result of the reprisal, but did not provide any medical evidence. The Board noted that the loss of long-term employment by a functionally illiterate individual with few marketable skills as a result of a baseless allegation of theft presumably gave rise to pain and suffering. The claimant gave evidence that he was extremely depressed, seeking treatment for mental health difficulties and experienced financial difficulties after being terminated, including losing his house and declaring bankruptcy. The Board stated that ordinarily this evidence would give rise to damages in excess of $3000 but this case was complicated because as the claimant was experiencing other problems that may have been factors in his pain and suffering. The Board found that in the absence of medical evidence to distinguish between the causes of the claimant’s distress, it was appropriate to simply affirm the ESO’s award of $3000 for pain and suffering.
Any consequential physical suffering caused by the emotional pain and suffering should also be considered when making an assessment under this heading. A claimant asserting that they experienced consequential physical suffering should provide some substantiation, such as a medical report.
In Melanie Lamoureaux v. JYSK Linen N Furniture Inc., 2015 CanLII 78257 (ON LRB),the Board awarded $5000 in damages for emotional distress. The Board found that the employer enhanced the employee’s distress when it did not inform her that her job had been eliminated when she sought to return to work. The employer’s attempt to give the employee the “run around” while it attempted to find her another job exacerbated the harm caused to the employee.
In 169809 Canada Limited o/a Portrait Impressions of Canada (April 16, 1993), ES 93-65 (Alter)the referee awarded 20 per cent of the total compensation awarded for lost wages, car allowance, vacation pay and loss of continued employment, which netted out at $4,942, for emotional pain and suffering. The referee did not refer to any specific facts in support of this amount. In the Program's view, using a percentage formula is not appropriate. On judicial review, the Divisional Court in 169809 Canada Limited o/a Portrait Impressions of Canada, Re, 1995 CanLII 10685 (ON SC)quashed that part of the referee's decision, indicating that an arbitrary percentage formula was not appropriate, and that there should be some evidence before the referee to support an award for mental pain and suffering.
An award under this heading is considered only if the employee's employment has been severed and the employee will not be ordered reinstated. Severance pay will only be awarded if the employee would qualify for severance pay pursuant to ESA Part XV, s. 64. See for example Rainbow Concrete Industries Limited v Lentir, 2012 CanLII 58233 (ON LRB).This entitlement will be reflected in a s. 103 order for unpaid wages rather than an order for compensation under s. 104. The order made in respect of severance pay is subject to the limitations on recovery under s. 111.
If an employer has reprised against an employee by discontinuing their participation in a benefit plan, a compensation order could be issued to compensate the employee for any expenses incurred due to the wrongful discontinuance of the plan. Note that in such a case, a compliance order could also be issued, requiring the employer to reinstate the employee's coverage - assuming that reinstatement of coverage is possible in the circumstances. Note as well that if an applicant for employment was reprised against because of their refusal to take a lie detector test (i.e., the employer refused to hire the applicant because they refused a lie detector test), the employment standards officer could issue an order for compensation for any expenses the applicant incurred that would otherwise have been covered by a benefit plan had the employee been hired in addition to an order to hire the employee - see ESA Part XVI, Lie Detectors.
If an employee was terminated contrary to s. 74 and subsequently reinstated, the employee would be entitled to compensation for the benefit plan coverage they would have had between the date of the termination and the date of reinstatement.
An employee whose employment was terminated contrary to s. 74 and in respect of whom a compensation order was made (but no order for reinstatement) would be entitled to compensation for the benefit plan coverage from the date of termination to the earlier of the date the employee found alternative employment or ought to have found alternative employment.
The heads of damages described under headings (1) to (7) above do not constitute an exhaustive list of damages that can be awarded in a compensation order. While they are the usual or most likely categories of award that are assessed, there may be other types of damages that flow directly from a contravention of s. 74 that are reasonable and foreseeable for which it would be appropriate to make an award for damages.
For example, consider the case of a pregnant employee whose employment was unlawfully terminated, in that the termination occurred because she was planning on taking a pregnancy and parental leave. At the time of the termination, the employee had not worked long enough to qualify for maternity and parental benefits under the Employment Insurance Act, although she would have qualified by the date she had planned on beginning her leave. The officer could order an amount under this head of damages that represents the Employment Insurance benefits the employee would have received had she worked long enough to qualify for them.
There are two limitation periods that apply with respect to an employee's ability to obtain a remedy under the Act:
This provision limits an employee's ability to recover wages to those that became due within specified periods preceding the date the complaint was filed. Any wages (including vacation pay) that come due on or after that date are recoverable if an employee files a claim for such wages within two years of the date the wages came due.
On February 20, 2015, the Stronger Workplaces for a Stronger Economy Act introduced a number of transitional provisions that imposed a six-month limitation period on unpaid wages that became due before February 20, 2015, and a 12-month limitation period for repeated contraventions and vacation pay that became due before February 20, 2015. Sections 111(3.1) to (8) were repealed on February 20, 2017 in accordance with s. 8(6) of Schedule 2 to the Stronger Workplaces for a Stronger Economy Act, 2014.
Although these sections are now repealed, it is Program policy that the limitation periods imposed by the transitional provisions continue to apply to wages, repeated contraventions and vacation pay that became due before February 20, 2015, even if any associated orders are issued after February 20, 2017. This is to preserve the vested legal rights of the parties at the time the contravention occurred. This is relevant in situations where a period of time lapses between the time a claim is filed and the time a claim is investigated. For more information, see ESA Part XXII, s. 111.
This provision imposes a two-year limitation period on filing a complaint by stating that a complaint filed more than two years after a contravention has occurred is deemed not to have been filed. Note that there will often be a period of time in between the date an employee engaged in a protected activity and the date the employer imposed a penalty. It is this latter date on which the contravention occurs. The two-year time limit starts to run only once a reprisal has actually been committed, i.e., from the date the employer imposed the penalty.
For example, an employee working for Employer A asserted her right to meal breaks in early 2014. In mid-2014, she resigned to work for Employer B and then in September 2017 applied for a job with Employer C. Employer A was contacted for a reference on September 6, 2017 and gave a negative reference because the employee had asserted her rights to meal breaks while she worked for Employer A. The reprisal occurred on September 6, 2017 and the two-year time limit in s. 96(3) begins to run from that date. The employee will therefore have until September 5, 2019 to file a reprisal claim. For practical purposes, the impact of this provision is limited to complaints in which reinstatement and/or compensation is sought as a remedy. See ESA Part XXII, s. 96(3) for more information.
As a result of these two provisions:
An employee who commenced pregnancy leave August 1, 2016 was scheduled to return to work on August 1, 2017. The employee was due for a length-of-service-driven pay increase on July 1, 2017, but was on her unpaid leave at that time. The employer unlawfully reprises against the employee by refusing to give the increase upon the employee's return because she was on leave for a year, and advises her that she will not get a pay increase until July 1, 2018. The employee files a claim on March 1, 2018.
The officer determines that the employee was entitled to the pay increase effective July 1, 2017, and that regular pay days on or after August 1, 2017, when she returned to work, should have reflected the increase. Because the employee had worked from August 1, 2017, to the date the claim was filed, the employer should have been paying the employee the higher wage rate and so far as the Act is concerned her pay between August 1, 2017, and March 1, 2018, should have reflected that. The employee thus had unpaid wages between those dates equal to the difference between what she should have been paid and what she was paid.
In this case, all of the unpaid wages came due within the two-year period prior to the date the claim was filed and so all are recoverable under the Act.
74(2) Subject to subsection 122(4), in any proceeding under this Act, the burden of proof that an employer did not contravene a provision set out in this section lies upon the employer.
Subject to s. 122(4), this provision places the legal burden of proof on the employer in any complaint alleging that the employer or a person acting on behalf of the employer has committed a reprisal contrary to s. 74. The effect of this provision is to require the employer to rebut an employee's claim that they have been reprised against. The employer must establish, on a balance of probabilities, that the employer did not contravene s. 74.
In the Board's decision in Daitch v Respironics Georgia, Inc., 2004 CanLII 12176 (ON LRB) the claimant sought damages on the basis that his employment was terminated as a reprisal for exercising his right under the Act to refuse to work on a public holiday. The only evidence before the Ontario Labour Relations Board was that of the claimant and this evidence disclosed that he had been employed by the company, had exercised his right to take the a public holiday as a day off (directly challenging his employer's direction to work that day) and was terminated three months later for reasons the Board described as "vague". The Board concluded that the employer had thereby failed to discharge the statutory burden of proof to show the termination was not a reprisal under s. 74.
In Bari v. 973864 Ontario Inc. o/a the Hosiery Shop, 2004 CanLII 5733 (ON LRB), the Board found that the employer had not discharged the onus to justify a significant reduction in the pregnant employee's hours and ultimate dismissal, despite its claim that declining revenues were the motivating factor for its actions.
But see also D-Zign Interior Planning & Project Management Inc. v. Madariaga, 2006 CanLII 6003 (ON LRB) where the Board found that the employer had discharged the onus in s. 74(2) of establishing that that the decision to terminate the claimant was in no way connected to her pregnancy or eligibility or intention to take a leave under Part XIV of the Act.
Section 74(2) is subject to s. 122(4), which provides:
Section 122(4) states that in a hearing before the Board arising from a review of a notice of contravention, the Director has the burden of proof. Therefore, if a notice of contravention has been issued with respect to a contravention of s. 74 and the person against whom the notice was issued files an application for review of the notice, the onus shifts to the Director of Employment Standards to show, on a balance of probabilities, that the employer contravened s. 74. For a more detailed discussion of s. 122(4), see ESA Part XXIII, s. 122.
The intent of the provisions found in Part XVIII.1 of the Employment Standards Act, 2000 is to set out specific obligations and prohibitions relating to temporary help agencies and clients of such agencies and specific rights of assignment employees (and in some cases prospective assignment employees) of temporary help agencies.
These provisions clarify the application of the ESA 2000 public holiday and termination and severance provisions within the context of the temporary help agency/assignment employee employment relationship. Those provisions, particularly those aspects dealing with the concept of lay-off and regular work weeks are difficult to apply where the employment relationship is based upon an agreement to find assignments to perform work and where such work is not performed for the employer directly but for a third party, i.e., the client of a temporary help agency. The modifications ensure that certain rights afforded to other employees are similarly afforded to assignment employees.
These provisions were also intended to extend the anti-reprisal protections for assignment employees by imposing prohibitions against reprisal on agency clients for whom the assignment employee was performing work. Previously, agency clients could, for example, terminate the assignment of any assignment employee for attempting to exercise rights to refuse excess hours of work while on assignment, without any repercussions under the reprisal provisions found in s. 74 of the Act, because the client was not the employee's employer. In such cases, an assignment employee was effectively unable to exercise his or her rights under the Act without protection from reprisal because the reprisal was effected by someone other than the assignment employee's employer.
Additionally, the provisions imposing a proportional liability for certain unpaid wages of the agency's assignment employees on clients of agencies (agencies as the employer remain liable for the full amount) are intended to reflect the fact that in general, a client benefits from the work of the assignment employee in proportion to the number of hours that the employee worked for the client.
The provisions related to prohibitions against fees and restrictions on entering into employment relationships were intended to reduce barriers to assignment employees and prospective assignment employees finding employment with clients of the agencies.
These sections provides that Part XVIII.1 does not apply to assignment employees who are assigned to provide homemaking, personal support and/ or professional services as defined in the Home Care and Community Services Act, 1994 (“HCCSA”) if the assignment is made under a contract between a) the assignment employee or b) his or her employer and a community care access corporation within the meaning of the Community Care Access Corporations Act, 2001, SO 2001, c 33. Clause (a) is meant to cover the situation in which the relationship between an individual providing services referred to in s. 74.2 and a community care access corporation is that of assignment employee and temporary help agency; in other words, the community care access corporation functions as a temporary help agency vis-á-vis the individual. Clause (b) is meant to cover the situation in which a temporary help agency has a contract with a community care access corporation to provide the services of employees and the agency assigns an assignment employee to perform work for the community care access corporation.
The definitions of homemaking services, personal support services and professional services contained in ss. 2(5) - (7) of the HCCSA are set out below:
In addition to providing services as described above, the assignment employee or their employer must have a contract for the assignment with a "community care access corporation" continued under the Community Care Access Corporations Act, 2001 or incorporated by regulation made under s. 2(4) of the Community Care Access Corporations Act, 2001.
This sections provides that Part XVIII.1 does not apply to assignment employees who are assigned to provide homemaking, personal support and professional services as defined in the HCCSA if the assignment is made under a contract between a local health integration network (“LHIN”) and either the assignment employee or their employer.
Clause (a) is meant to cover the situation in which the relationship between an individual providing services referred to in s. 74.2.1 and a LHIN is that of assignment employee and temporary help agency; in other words, the LHIN functions as a temporary help agency vis-á-vis the individual. Clause (b) is meant to cover the situation in which a temporary help agency has a contract with a LHIN to provide the services of employees and the agency assigns an assignment employee to perform work for the LHIN.
The definitions of homemaking services, personal support services and professional services contained in ss. 2(5) - (7) of the HCCSA are set out below:
In addition to providing services as described above, the assignment employee or their employer must have a contract for the assignment with a LHIN as defined in the Local Health System Integration Act, 2006, SO 2006, c 4 (“LHSIA”). Section 2(1) of the LHSIA defines a local health integration network as follows:
“local health integration network” means a corporation that is continued under subsection 3 (1) or incorporated by regulation under subsection 3 (3);
Section 3(1) of the LHSIA provides a list of corporations continued as LHINS:
Note that this list is not exhaustive and that other LHINs may be incorporated pursuant to regulation as per s. 3(3) of the LHSIA.
This section provides that an employment relationship exists between a temporary help agency and a person at the point that they agree (whether or not in writing) that the agency will assign or attempt to assign the person to perform work on a temporary basis for clients or potential clients. It is the existence of such an agreement that establishes the employment relationship.
Whether there is or is not such an agreement is a question of fact. Arguably, if a temporary help agency is simply receiving unsolicited resumes that have been forwarded to the agency, this is not, on its own, evidence that the agency has agreed to assign or attempt to assign the individual to perform work on a temporary basis for clients.
An agreement in writing to that effect would clearly demonstrate that an employment relationship existed between the parties but the agency's agreement may also be expressed by the actions of the agency rather than in writing. For example, agreement would be demonstrated by an attempt by the agency to match the individual who had submitted a resume with a client.
A person does not have to be assigned to perform work for a client of the agency in order for there to be an employment relationship with the agency. The employment relationship is established by the agreement between the parties and not whether the employee is assigned to perform work for a client of the agency. As a result, it is not necessary for an employee's first assignment (if any) to begin on the date of hire. On this point see the discussion of ESA Part XVIII.1, s. 74.4(3).
This section provides that an assignment employee of a temporary help agency is assigned to perform work for a client (i.e., is on a work assignment) if the agency arranged for the employee to perform work for the client on a temporary basis and the employee is performing the work. As noted in the definition of assignment employee in ESA Part I, s. 1, the Program's position is that "work on a temporary basis" would obviously include a short term assignment but would also include long term or open ended placements with a client. The work is considered to be temporary because there is no permanent placement with the client; the assignment employee continues to be the employee of the agency and not the client throughout the period of the assignment.
In addition, pursuant to ESA Part I, s. 1(2), an assignment employee is assigned to perform work for a client if the employee is assigned to receive training from the client for the purposes of performing work for that client.
This provision clarifies that a work assignment begins on the first day the employee performs work pursuant to the assignment and ends when the term of the assignment ends (where a term of the assignment has been established) or alternatively, when the assignment is ended by the agency, the assignment employee or the client.
For example, an assignment employee accepts an offer of a work assignment from the agency on June 15 and commences performing work for the client under that assignment on June 18. If the terms of the assignment stipulated that the assignment ended on September 15, the assignment would begin June 18 and end on September 15, assuming the employee actually ceased performing work for the client of the agency on that day. If however, the client terminated the assignment on August 21, the assignment would end on that earlier date. Alternatively, if the employee continued to perform work for the client after September 15, e.g., to November 1, the assignment would end on November 1.
This provision clarifies that an assignment employee's employment relationship with a temporary help agency is not ended because the employee is, or is not, on an assignment to perform temporary work for a client of the agency.
The employment relationship is established pursuant to ESA Part XVIII.1, s. 74.3 by a temporary help agency and a person having agreed that the agency will assign or will attempt to assign the person to perform work for a client or potential clients on a temporary basis.
Section 74.4(3) clarifies that being, or not being, on assignment is not the determining factor in ending the employment relationship. Once the employment relationship is established, it will continue whether or not the employee is on assignment and despite gaps between assignments unless the employment relationship is terminated and/or severed.
It should be noted however that a termination or severance of the employment relationship may be triggered by a lay-off lasting a certain number of weeks within a specified period of consecutive weeks. See the discussion at ESA Part XVIII.1, s. 74.11.
This subsection clarifies that an assignment employee is not on a work assignment simply because the agency has provided the client with the assignment employee's resume, arranged for the client to interview the employee or otherwise introduced the client to the assignment employee.
Although the agency may do any or all of these things, unless the agency has arranged for the employee to perform work for a client on a temporary basis and the employee is performing such work, the assignment employee is not on assignment per s. 74.4(1).
This provision requires temporary help agencies to maintain records of the hours worked by their assignment employees in each day and week for each client of the agency and retain a copy of any written notice provided to an assignment employee under ESA s. 74.10.1(1). Corresponding client record keeping obligations with respect to maintaining records of hours worked in each day and each week are set out in s. 74.4.2.
The record keeping obligations in clause (a) were added because of the client joint and several liability for certain unpaid wages of the agency's assignment employees, which is based upon the proportional number of hours worked for each client in any particular pay period, introduced by the Stronger Workplaces for a Stronger Economy Act, 2014, SO 2014, c 10. The record keeping obligations in clause (b) were added because of the new provision requiring notice of termination of assignment introduced by the Fair Workplaces Better Jobs Act, 2017. See the discussion at ESA Part XVIII.1, s. 74.18 and ESA Part XVIII.1, s.74.10.1.
For a discussion of an employer's general obligations to make and retain records with respect to hours of work see ESA Part VI. Note that there is no provision in s. 74.4.1 that corresponds to the exception regarding records of hours for salaried employees as set out in ESA Part VI, s. 15(3).
Under this section, a temporary help agency must retain the records required under s. 74.4.1(1) or arrange for another person to retain them for three years. The retention period is the same as the three year period for retaining records regarding hours of work under ESA Part VI, s. 15(5) paragraph 3.
If the agency makes arrangements for another person, such as a bookkeeper or accountant, to retain the records made under s. 74.4.1(1), it is the agency's responsibility to ensure that the records are readily available for inspection by an employment standards officer. This provision is similar to ESA Part VI, s. 16, which requires that records that must be retained under ESA Part VI, ss. 15 and 15.1.
The Stronger Workplaces for a Stronger Economy Act, 2014 added this provision to the Employment Standards Act, 2000.
This provision requires clients of temporary help agencies to maintain records of the hours of work performed for the client, by each assignment employee of the agency, in each day and each week. Corresponding temporary help agency record keeping obligations are set out in ESA Part XVIII.1, s. 74.4.1.
These new record keeping obligations were added because of the joint and several liability imposed on clients for certain unpaid wages owing to assignment employees that came into force on November 20, 2015 pursuant to ESA Part XVIII.1, s. 74.18.
Under this section, a client of a temporary help agency must retain the records required under s. 74.4.2(1) or arrange for another person to retain them for three years. The retention period is the same as the three year period for retaining records regarding hours of work under paragraph 3 of ESA Part VI, s. 15(5).
If the client makes arrangements for another person, such as a bookkeeper or accountant, to retain the records made under s. 74.4.2(1), it is the client's responsibility to ensure that the records are readily available for inspection by an employment standards officer. This provision is similar to ESA Part VI, s. 16, which requires that records that must be retained under ESA Part VI, s. 15 and s. 15.1 and must be readily available for inspection.
This section imposes an obligation on a temporary help agency to provide information about the agency to its assignment employee as soon as possible after entering into an employment relationship with him or her as an assignment employee. The agency must provide, in writing, the legal name and any operating name or business name if different than the legal name. The agency is also required to provide an address, telephone number and at least one contact name for the agency.
What is "as soon as possible" will depend upon the circumstances.
This section requires that the information be provided to the assignment employee "in writing". Program policy is that an electronic agreement may constitute an agreement "in writing" under the Employment Standards Act, 2000. For further discussion of "agreements in writing" see ESA Part I, s. 1. As a consequence, the Program's position is that an agency would be in compliance with this section if the information in s. 74.5(1) was provided in an electronic document. It may therefore be provided by electronic mail, if the employer ensures the employee has convenient access to e-mail and can easily print the document. In addition, even though it is not sent personally in any format to the employee, the Program takes the position that the agency will be complying with this requirement if the employer ensures the employee has convenient access to an electronic version of the document (and knows how to access it) and a printer (and knows how to use it). In the latter case, simply providing an employee with a website address would be insufficient to meet the requirement to provide the information in writing.
Section 74.5(2) requires an agency to provide the information in s. 74.5(1) to those of its assignment employees already in the agency's employ on the day the amendments made under the Employment Standards Amendment Act (Temporary Help Agencies), 2009, SO 2009, c 9 came into force (November 6, 2009). Such employees must be provided with the information (in writing), as soon as possible after November 6, 2009.
What is "as soon as possible" will depend upon the circumstances.
Because the intent of this provision is to ensure that assignment employees who were hired before s. 74.5(1) came into force, receive the information about the agency specified in that provision, the Program's position is that an agency that provided this information prior to November 6, 2009 would be in compliance with s. 74.5(2) so long as the information is still accurate on November 6, 2009 and the employee still has a copy of it.
This section imposes an obligation on a temporary help agency when offering a work assignment with a client to an assignment employee, to provide certain information about the client and the assignment to the assignment employee. In accordance with s. 74.6(2) the information may initially be provided orally, but must subsequently be provided in writing as soon as possible after offering the assignment.
In accordance with s. 74.6(1), the agency must provide the client's legal name and any operating name or business name if different than the legal name. The agency is also required to provide an address, telephone number and at least one contact name for the client.
In addition, the agency must provide information about the assignment itself as follows:
This subsection must be read in conjunction with s. 74.6(1), which lists information regarding the client and work assignment that must be provided to an assignment employee at the time the work assignment is offered. Section 74.6(2) provides that if the information is provided orally, it must subsequently be provided, in writing, as soon as possible after the offer was made. Note that the requirement to provide this information in writing is not relieved even if the assignment employee refused the offer after being provided with the information orally.
What is "as soon as possible" will depend upon the circumstances.
This section requires that the information be provided to the assignment employee "in writing". Program policy is that an electronic agreement may constitute an agreement "in writing" under the Employment Standards Act, 2000. For further discussion of "agreements in writing" see ESA Part I, s. 1. As a consequence, the Program's position is that an agency would be in compliance with this section if the information in s. 74.6(1) was provided in an electronic document. It may therefore be provided by electronic mail, if the employer ensures the employee has convenient access to e-mail and can easily print the document. In addition, even though it is not sent personally in any format to the employee, the Program takes the position that the agency will be complying with this requirement if the employer ensures the employee has convenient access to an electronic version of the document (and knows how to access it) and a printer (and knows how to use it). In the latter case, simply providing an employee with a website address would be insufficient to meet the requirement to provide the information in writing.
Section 74.6(3) requires that an agency provide the information required by s. 74.6(1) to those of its assignment employees who were offered or who were on a work assignment on November 6, 2009, the day the amendments made under the Employment Standards Amendment Act (Temporary Help Agencies), 2009, SO 2009, c 9 came into force. Such employees must be provided with the information (in writing), as soon as possible after November 6, 2009.
Section 74.7(1) provides that the Director of Employment Standards shall prepare and publish a document that provides information about the rights and obligations of assignment employees, temporary help agencies and clients as the Director considers appropriate.
At the time of writing, the document prepared pursuant to this section is entitled "Your Employment Standards Rights: Temporary Help Agency Assignment Employees." The document is available from Publications Ontario or can be downloaded from the Ministry of Labour's website.
This subsection provides that if the Director believes that the document published under s. 74.7(1) regarding rights and obligations under Part XVIII.1 of the Act is out of date, he or she will prepare and publish a new document.
This section imposes an obligation on a temporary help agency to provide a copy of the most recent version of the document published by the Director under s. 74.7(1) to its assignment employee as soon as possible after the person becomes an assignment employee of the temporary help agency.
The employer may provide the document as a paper copy or electronically. If the document is made available by access to an internet database, the employer must ensure the employee has reasonable access to the database and a printer and knows how to use the computer and the printer. The document may also be sent to the employee by electronic mail although the employer will again be responsible for ensuring the employee has access to the means of making a paper copy.
What is "as soon as possible" will depend upon the circumstances.
This section states that where the language of an assignment employee is a language other than English, the employer is required to inquire as to whether the Director has prepared a translation of the document published under s. 74.7(1) into that language. If a translation of the document into that language has been prepared, the agency is required to provide a copy of that translation together with the English version to the assignment employee.
Section 74.7(5) requires an agency to provide the document as required under s. 74.7(3) to those of its assignment employees already in the agency's employ on November 6, 2009, the day the amendments made under the Employment Standards Amendment Act (Temporary Help Agencies), 2009, SO 2009, c 9 came into force. Such employees must be provided with the most recent copy of the document published under s. 74.7(3) and if applicable, and if it is available at that time, a translation in accordance with s. 74.7(4), as soon as possible after November 6, 2009.
This section prohibits temporary help agencies (“THAs”) from:
This section must also be read in conjunction with s. 74.8(4) which provides that references to assignment employee within this section include a prospective assignment employee. These prohibitions will therefore apply to prospective assignment employees where the circumstances or context would allow.
In addition, because the definition of employee in ESA Part I, s. 1 includes a person who was an employee, the prohibitions and restrictions in s. 74.8 would apply with respect to an individual who was previously an assignment employee of an agency. For example, an agency could not impose a restriction that would restrict a client of the agency from entering into an employment relationship with former employees of the agency or vice versa.
Note that where an agency contravenes certain provisions of s. 74.8, new order making powers within Part XVIII.1 are available in addition to the enforcement tools in ESA Part XXII and prosecution under ESA Part XXV. See ESA Part XVIII.1, s. 74.14 to s. 74.17.
Under paragraphs 1, 2, 3 and 5, agencies cannot charge fees to assignment employees in connection with becoming an assignment employee, obtaining work assignments, entering into an employment relationship with a client of the agency, or for assistance in preparing resumes or preparing for job interviews.
Any fee associated with a person and an agency agreeing to enter into an employment relationship is prohibited under para. 1 of s. 74.8(1). An employment relationship is defined in the context of assignment employees and temporary help agencies under ESA Part XVIII.1, s. 74.3 as an agreement (whether or not in writing) that the agency will assign or attempt to assign the person to perform work on a temporary basis for clients or potential clients of the agency.
Because the prohibitions in s. 74.8 apply with respect to prospective assignment employees as well as assignment employees, the prohibition in para. 1 applies whether or not there is actually an employment relationship between the person and the agency when the fee is charged.
An agency would therefore be prohibited from charging a fee to a person when that person inquires about signing on with the agency for the purposes of the agency attempting to place them with clients for temporary work. An agency would be likewise prohibited from charging a fee for taking applications, interviewing, or otherwise considering a person for employment as an assignment employee.
Pursuant to paragraph 2, any fee charged to an assignment employee with respect to assigning or attempting to assign the employee to perform work on a temporary basis for clients is prohibited. For example, an agency would be prohibited from charging a fee to an assignment employee for sending them to interviews with clients for possible work assignments or when a work assignment was offered or accepted.
Pursuant to paragraph 3, agencies are prohibited from charging assignment employees for any assistance or instruction with respect to preparing resumes or preparing for job interviews. Where such services are provided to assignment employees (whether optional or mandatory) they must therefore be provided free of charge.
Generally, an agency would not be prohibited from charging fees for services related to resume preparation and job interview preparation in relation to persons other than assignment employees. However, because s. 74.8(4) provides that references to assignment employees within s. 74.8 include prospective assignment employees, the fact no employment relationship exists between the person and the agency at the time the service is provided or the fee charged, is not the determining factor when considering whether the fee is prohibited. In such situations it would be necessary to determine whether the person was a prospective assignment employee - see the discussion regarding prospective assignment employees in s. 74.8(4).
Pursuant to paragraph 5, agencies are prohibited from charging any fees in connection with an assignment employee entering into an employment relationship with a client of the agency. As a result, where an assignment employee is offered a position as an employee of the client, they cannot be required to pay the agency any fee in connection with the offer or acceptance of that offer.
Under paragraph 8, agencies cannot charge fees to a client of the agency in connection with the client entering into an employment relationship with an assignment employee, except as permitted under s. 74.8(2). The prohibition in para. 8 is similar to that in paragraph 5 except that the agency is prohibited in the latter case from charging the fees to an assignment employee in connection with entering into an employment relationship with a client of an agency.
Because s. 74.8(4) provides that references to assignment employees within s. 74.8 include prospective assignment employees, the prohibition against charging a fee also applies even though no employment relationship exists between the person and the agency at the time the client of the agency and the person (prospective assignment employee) enter into an employment relationship. See the discussion regarding prospective assignment employees in s. 74.8(4).
Under paragraph 4, agencies are prohibited from restricting an assignment employee of the agency from entering into an employment relationship with a client of the agency. This provision prevents agencies from incorporating terms into an agreement with an assignment employee that would in any way prevent or restrict their ability to enter into an employment relationship with a client of the agency.
Pursuant to paragraph 6, agencies are prohibited from imposing any restrictions on a client that would restrict the client’s ability to provide an assignment employee of the agency with a reference. Whether the assignment employee was seeking employment with another client of the agency, another agency or an employer with no connection to the agency, the agency is prohibited from restricting the client’s ability to provide the assignment employee with a reference.
Paragraph 7 prevents agencies from incorporating terms into an agreement with a client that would in any way prevent or restrict their ability to enter into an employment relationship with an assignment employee of the agency. It is the converse of the prohibition on restrictions on an assignment employee entering into an employment relationship with a client of an agency as set out in paragraph 4. This prohibition prevents an agency from restricting a client from hiring the agency’s assignment employees, whether or not such employees had ever been assigned to perform work for that client.
In addition, because s. 74.8(4) provides that references to assignment employees within s. 74.8 include prospective assignment employees, the prohibition in paragraph 7 applies to prohibit an agency from attempting to restrict a client from entering into an employment relationship with a prospective assignment employee; that is, where no employment relationship exists as yet between the person and the agency.
Paragraphs 9 and 10 prohibit fees and restrictions as prescribed by regulation. At the time of writing, no fees or restrictions were prescribed.
Under para. 8 of s. 74.8(1), THAs are prohibited from charging fees to a client in connection with the client entering into an employment relationship with an assignment employee except as permitted under this subsection.
Subsection 74.8(2) states the agency may charge a fee to the client in the event the client enters into an employment relationship with the assignment employee, but only where an assignment employee has been assigned to perform work on a temporary basis for that client by the agency (and the employee has begun to perform the work) and the fee is charged within the six-month period beginning on the first day on which the employee began to perform work for the client.
The Program’s position is that under some circumstances, the fact that the fee is paid or collected outside the six-month period does not necessarily mean it is not permitted under s. 74.8(2). The question is, when was the fee charged?
For example, assume a contract clearly states that the client will be charged a particular fee, forthwith, if it hires an assignment employee within the six-month period beginning on the first day on which its assignment employee was assigned and began to perform work for the client. If the client does enter into an employment relationship with an assignment employee within that six-month period the fee may, depending on all the circumstances, be considered to have been charged at that time and may be permitted under s. 74.8(2), whether or not it was actually paid or collected within the six-month period.
If an assignment employee was assigned to perform work for a client and began performing the work on May 1, the agency could subsequently charge the client a fee for hiring that assignment employee directly, but only if the client hired the assignment employee before November 1 and the agency charged its fee within that same six-month period. The length of the original assignment and/or whether there was more than one assignment during that period is not relevant to the agency’s ability to charge the fee.
If an assignment employee had never been assigned to perform work for a particular client by the agency and was hired directly by that client, the exception in s. 74.8(2) would have no application and the agency would be prohibited pursuant to para. 8 of s. 74.8(1) from charging a fee to the client.
Note that ESA Part XVIII.1, s. 74.15 provides that if a temporary help agency charges a fee to a client in contravention of paragraph 8 or 9 of s. 74.8(1), the client may recover the amount of the fee in a court of competent jurisdiction.
The six-month period during which the agency may charge a fee to a client runs from the first day that an assignment employee who is assigned by the agency to perform temporary work for the client begins to perform work for that client. The six-month period runs from that date regardless of the length of the first assignment or any subsequent assignments as well as the amount or timing of any work performed by the assignment employee.
For example, employee B was given an assignment by agency A to perform work on a temporary basis for client C commencing February 1, 2010 and ending December 1, 2010. This was the very first time employee B was ever assigned by agency A to perform work for client C. If B was reassigned to perform work for C in January 2011 and C chose to enter into an employment relationship directly with B in March 2011, A would be prohibited from charging C a fee for doing so. The six-month period during which the agency A was permitted to charge a fee ended six months after B first began to perform work for client C (i.e., the six-month period ended on July 31, 2010).
As another example, agency A assigns employee B to perform temporary work for the very first time with client C on February 1, 2010. The assignment was "part-time" (only 24 hours per week) and ended on February 26. Agency A did not assign B to perform work for client C again. On September 1, 2010, the client entered into an employment relationship directly with B. The agency could not charge C a fee for doing so because the six-month period during which the agency A was permitted to charge a fee ended six months after B first began to perform work for client C (i.e., it ended on July 31, 2010).
Again, the six-month period within which the agency could charge a fee begins on the date the employee is assigned and first begins to perform work for the client of the agency regardless of the duration of the first assignment and whether or not there were any subsequent assignments prior to the client and assignment employee entering into the employment relationship. The hours of work or amount of work associated with the first and any subsequent assignments are not a consideration in the timing of the six-month period.
Under this subsection, references to assignment employee within s. 74.8 include a prospective assignment employee. As a result, the prohibitions against charging certain fees and prohibitions against imposing restrictions on clients and assignment employees from entering into employment relationships with one another, as well as restrictions that would prevent clients from providing references for assignment employees are also applicable as context or circumstances require, to prospective assignment employees.
Although ESA Part I, s. 1 defines assignment employee as an employee employed by a temporary help agency for the purpose of being assigned to perform work on temporary basis for clients of the agency, the ESA 2000 does not define prospective assignment employee.
It is the Program’s position that where an agency may consider, is considering or has considered entering into an employment relationship as defined in ESA Part XVIII.I, s. 74.3 with an individual, that individual will be considered a prospective assignment employee for the purposes of the prohibitions in s. 74.8.
Evidence that would support a determination that an agency may consider, is considering or has considered entering into an employment relationship with an individual could include:
As the effect of s. 74.8(4) is to extend the prohibitions in s. 74.8 in relation to prospective assignment employees, fees or restrictions could be charged to or imposed with respect to persons who were neither assignment employees nor prospective assignment employees. As a result, an agency could offer resume writing services or job interview services to persons other than assignment employees or prospective assignment employees and not be in violation of s. 74.8. However, whether an individual is a prospective assignment employee will depend upon whether the evidence shows that the agency intended to enter or considered entering into an employment relationship with the individual at the time the otherwise prohibited fee was charged or restriction imposed.
For example, an individual might seek assistance in preparing a resume from an agency that provides such services both independently and as part of its operation as a temporary help agency. If the individual paid a fee for the assistance received, the fee would not be prohibited if the individual was neither an assignment employee nor a prospective assignment employee. If the parties had not entered into an employment relationship as defined in ESA Part XVIII.1, s. 74.3 at that time, the individual would clearly not be an assignment employee. But, if the evidence showed that the agency’s intention was to hold the individual’s resume for the purposes of reviewing it and possibly offering an assignment to that individual at a later date, it would be open, depending upon all the other facts before the officer, for that officer to conclude that the individual was a prospective assignment employee at the time the fees had been charged and to issue an order under ESA Part XVIII.1, s. 74.14 to recover the prohibited fees.
Finally, as noted above, s. 74.8(4) will apply to prohibit charging certain fees and imposing certain restrictions with respect to prospective assignment employees in addition to assignment employees, as context or circumstances require. For example, the prohibition in para. 1 of s. 74.8(1) readily applies to prospective assignment employees as it prohibits fees being charged to an individual in connection with becoming an assignment employee. As a result, an agency would be prohibited from charging a fee for submitting an application for employment or a resume, or attending a job interview, regardless of whether or not the individual was ultimately offered or accepted an offer of employment.
On the other hand, the prohibition in paragraph 6 of s. 74.8(1) against restricting a client from providing a reference for an assignment employee of the agency would not under ordinary circumstances apply to prospective assignment employees. Presumably, in order for the client to be in a position to provide a reference, the individual would have to have been assigned by the agency to perform work for the client. Thus, the individual would have to be an assignment employee of the agency.
This section provides that any provision in an agreement between a temporary help agency and an assignment employee that are inconsistent with s. 74.8 (e.g., charges a prohibited fee as per paras. 1,2,3 or 5 of s. 74.8(1) or imposes a prohibited restriction as per para. 4 of s. 74.8(1) is void. Under s. 74.9(4), this provision also applies with respect to agreements between a temporary help agency and a "prospective assignment employee." See the discussion in ESA Part XVIII.1, s. 74.8(4).
This section provides that any provision in an agreement between a temporary help agency and client that is inconsistent with s. 74.8 (e.g. charges a prohibited fee as per s. 74.8(1) para. 8 or imposes a prohibited restriction as per s. 74.8(1) paras. 6 or 7) is void.
Under this provision, terms of agreements between agencies and assignment employees or between agencies and their clients that are inconsistent with s. 74.8 are void, whether the agreement was entered into before the date these amendments to the Employment Standards Act, 2000 came into force (November 6, 2009) or after that date.
However, where such terms existed in an agreement prior to November 6, 2009 and fees were actually charged and/or restrictions imposed prior to that date; no order could issue under s. 74.14 with respect to those fees and no order could issue under s. 74.16 for losses suffered with respect to those restrictions as neither the fees nor the restrictions were prohibited until November 6, 2009.
Under this provision, the reference to "assignment employee" in subsection 74.9 includes a prospective assignment employee. As a result, a term in an agreement between an agency and a prospective assignment employee that, for example, required the prospective assignment employee to pay a fee to become an assignment employee of the agency, (e.g. entering into an agreement for the purposes of the agency assigning or attempting to assign the person to perform work for clients or potential clients of the agency), would be void. Such a term would be void regardless of whether the agreement was entered into before or after November 6, 2009, the date on which s. 74.9 came into force.
See the discussion of the term "prospective assignment employee" in ESA Part XVIII.1, s. 74.8(4).
Subsection 74.10(1) clarifies the application of s. 29(2.1) of the Act as it applies to most assignment employees of temporary help agencies, by providing that a lay-off for the purposes of that section means a day on which the assignment employee is not on an assignment to perform temporary work for a client of the agency. The provisions that clarify what constitutes a layoff for the purposes of determining entitlements to notice of termination/termination pay in lieu of notice and/or severance pay for assignment employees in s. 74.11 are not relevant when determining public holiday entitlements for assignment employees pursuant to s. 29(2.1).
Note that pursuant to s. 74.2, Part XVIII.1 of the Act (which includes s. 74.10(1)) does not apply to those assignment employees who provide professional services, personal support services or homemaking services as defined in the Long-Term Care Act, 1994, SO 1994, c 26 (renamed the Home Care and Community Services Act, 1994 as of July 1, 2010) if the assignment is made under a contract between the employee or his or her employer and a community care access corporation within the meaning of the Community Care Access Corporations Act, 2001, SO 2001, c 33. As a result, the application of s. 29(2.1) is not modified in respect of such employees by s. 74.10(1).
The Program's position is that a public holiday will be considered to fall on a day that is ordinarily a working day for an assignment employee only if the employee is on assignment and the holiday falls on a day that he or she would be working pursuant to the assignment (assuming there had been no holiday). In that case only, s. 26, 27 or 28 apply to determine the employee's public holiday entitlements. In all other cases, the employee's public holiday entitlements will be determined under s. 29 and 30.
Because public holiday entitlements can be affected by the timing of a termination of employment, it is important to note that subsection 74.4(3) provides that an assignment employee does not cease to be employed by the temporary help agency when he or she is assigned to perform work for an agency client (i.e., he or she is on assignment with a client) nor is his or her employment considered terminated by the agency merely because the assignment with a client has ended and the agency has not yet given a new assignment. A period of non-assignment will not in itself trigger a termination of the employment relationship, unless the weeks of non-assignment constitute weeks of lay-off under s. 74.11 and those weeks of lay-off go on longer than the period of "temporary lay-off".
This could be relevant to the application of s. 29(2.1) of the Act insofar as assignment employees are concerned. Subsection 29(2.1) provides that where a public holiday falls on a day that would not be a working day for an employee and the employee is on lay-off on that day, the employee is entitled to public holiday pay for that day but has no other entitlement under Part X. For purposes of s. 29(2.1), s. 74.10(1) of the Act provides that where an assignment employee is not on assignment on a day on which a public holiday falls, the assignment employee is considered to be on lay-off on that day. Note, however, that s. 29(2.2) provides that if an employee's employment has been terminated because of a lay-off lasting longer than a temporary lay-off, s. 29(2.1) does not apply in respect of a public holiday falling on or after the day on which the temporary lay-off period was exceeded. Note also that under s. 74.10(2), the period of a temporary lay-off for an assignment employee must be determined in accordance with s. 56 of the Act as modified by the special rules in s. 74.11.
The fact that an assignment employee's employment is not considered terminated merely because his or her assignment with a client of the temporary help agency employer has ended and the agency has not yet given him or her a new assignment could also be relevant to the application of section 32 of the Act. Section 32 provides that where an employee was entitled to a substitute day off work for a public holiday but his or her employment was terminated before the substitute day was taken, the employee will be entitled to public holiday pay for that day. However, the mere ending of an assignment employee's assignment does not in itself mean that his or her employment has been terminated, even if no new assignment has yet been given. Generally speaking, in that situation the assignment employee will be considered to be on lay-off, and s. 32 will not apply unless the lay-off ends up exceeding the period of a temporary lay-off before the substitute day is taken.
Note that s. 29(2.1) must be read in conjunction with s. 29(2.2). Under s. 29(2.2) if an employee is terminated pursuant to clause 56(1)(c) (by a layoff that exceeds a period of temporary lay-off) and the employee continues to be on a lay-off after that day (e.g. where employment has been terminated but has not yet been severed), s. 29(2.1) does not apply. See ESA Part X, s. 29 for a discussion of s. 29(2.2). Note as well that s. 74.10(2) provides that for the purposes of applying s. 29(2.2) to an assignment employee, the period of temporary lay-off is determined in accordance with s. 56 as modified by s. 74.11. See the discussion of s. 74.11 in ESA Part XVIII.1.
Section 74.10(1) came into force on November 6, 2009. Prior to that date, the Program took the view that an assignment employee who qualified for public holiday entitlements was on a lay-off for the purposes of s. 29(2.1) if the employee was not on assignment and the agency had not made an offer of an assignment that would, if accepted, have resulted in the employee being on assignment when the public holiday fell. If the employee had refused all offers of assignments that would have resulted in the employee being on assignment when the holiday fell or had advised the agency that he or she was not available for assignment in a week in which a holiday fell, he or she was not considered to be on a lay-off for the purposes of s. 29(2.1). This Program policy no longer applies with the coming into force of s. 74.10(1), although it would continue to apply with respect to public holidays that fell prior to November 6, 2009.
This provision came into force on November 6, 2009. Under s. 74.10(2), the reference to a period of temporary lay-off within s. 29(2.2) with respect to an assignment employee, is determined in accordance with the modifications made to s. 56 of the Act by s. 74.11. See the discussion of s. 29(2.2) ESA Part X, s. 29. Note however that pursuant to s. 74.2, Part XVIII.1 of the Act, which includes s. 74.10(2), does not apply to those assignment employees who provide professional services, personal support services or homemaking services as defined in the Long-Term Care Act, 1994 (renamed the Home Care and Community Services Act, 1994 as of July 1, 2010) if the assignment is made under a contract between the employee or his or her employer and a community care access corporation within the meaning of the Community Care Access Corporations Act, 2001. As a result, the application of s. 29(2.2) is not modified in respect of such employees by s. 74.10(2).
Pursuant to s. 74.11, a period of temporary lay-off for the purposes of s. 56 of the Act is a period of 13 weeks within 20 consecutive weeks or under certain circumstances, 35 weeks within 52 consecutive weeks in which the assignment employee is not assigned to perform work on a temporary basis for a client of the agency. Section 74.11 also modifies "excluded week" (weeks that are not counted as weeks of lay-off but are counted in the 20 and 52 consecutive week periods) to mean a week in which for one or more days, an assignment employee is not able to work, is not available for work, refuses an offer by an agency that would not constitute constructive dismissal of the employee by the agency, is subject to a disciplinary suspension or is not assigned to perform work for a client of the agency because of a strike or lock-out occurring at the agency. See the discussion of s. 74.11 in ESA Part XVIII.1.
Section 74.10.1(1) requires that a temporary help agency provide one week’s written notice of the termination of an assignment to an assignment employee, provided that the assignment employee was assigned to perform work for a client for an estimated duration of three months or more at the time it was offered to the employee, and if the assignment is terminated before the end of the estimated term date. If the temporary help agency elects to pay one week’s wages as termination of assignment pay in lieu of the written notice, it must be done in accordance with s. 74.10.1(2). Termination of assignment and termination of employment are distinctly different.
If an assignment employee was provided with notice of termination of assignment and subsequently (i.e., after the notice of termination of assignment has expired or pay in lieu of notice is paid) the employee’s employment is terminated, the employee will be entitled to their full notice of termination of employment pursuant to ESA Part XV, s. 57 or s. 58, as modified by ESA Part XVIII.1, s.74.11. Any notice or pay in lieu paid in respect of a notice of termination of assignment cannot be used to offset the obligation to provide notice of termination of employment under s. 57 or s. 58, as modified by s.74.11.
However, when the employment of an assignment employee is terminated at the same time as the assignment with a client is terminated, the notice of termination of assignment can be given concurrently with notice of termination provided under s. 57 or s. 58, as modified by s. 74.11. For example, an employee has been employed for eight months and is on an assignment that is expected to last 5 months. The THA terminates the assignment employee’s employment and the assignment will also end. The THA sends a letter to the employee stating both the employee’s employment and assignment will end in one week, i.e. one weeks written notice is provided. It is program policy that this satisfies the minimum notice requirement for both termination of assignment and termination of employment. The THA is not required to add one week of notice for termination of the assignment to the one week notice of termination of employment to provide the employee with two weeks of notice.
An assignment employee that has been employed for eight months, and regularly works Monday to Friday and is on an assignment that is expected to last five months is provided with one weeks written notice of termination of assignment on Monday. Subsequently on Thursday of the same week, the employee is provided with written notice that their employment is terminated with the THA as of Friday. The THA has met the requirement of providing one week written notice of termination of assignment and nothing further is required. The employee was worked two days after being provided with written notice of termination and would be entitled to the remainder of the week’s notice as pay in lieu of notice of termination.
In order for an employee to be entitled to the one week written notice or pay in lieu of notice, all three conditions set out in 74.10.1(1) must be met.
The assignment employee must actually be assigned to perform work for a client. See ESA Part I, s. 1 for a discussion of what is considered to be assigned to perform work.
In order to qualify for notice under s. 74.10.1, the estimated term of the assignment at the time the assignment was offered to the employee must be three months or more. There is no requirement that the employee has worked for the client business for three months. The question is simply whether or not the assignment had an estimated term of three months or more at the time it was offered to the employee. Note that there is no obligation to provide an assignment employee with this information if it is not available at the time the offer is made in accordance with ESA Part XVIII.1, s. 74.6(1) para 7. It should be noted that the intent is for the notice to be provided if at the time of the offer of assignment, it was estimated to last a term of three months or more. If a THA offers concurrent 11 week assignments, whether with the same client business or not, the assignment employee is not entitled to notice of termination of assignment. This is because at the time of the offer the assignment was not for longer than three months and therefore no notice is required. If at the time the assignment was offered it was only to last one month, and is extended beyond three months, the employee is not entitled to one weeks written notice. An officer will have to investigate to determine if there is evidence that the offer of assignment was to last longer than three months.
Lastly, if the employee’s assignment with the client is terminated before the estimated end of the term which at the time of the offer of assignment was made was three months or more, the employee will be entitled to one weeks’ written notice or pay in lieu of notice as per s. 74.10.1(2).
There is no equivalent in s. 74.10.1 to ESA Part XV, ss. 60(1) or (2), which set out an employee’s entitlements to wages during a week of the notice of termination of employment under ESA Part XV, ss. 57 or 58. In the absence of such provisions, Program policy is that an officer will determine the employee’s entitlement to pay during the one week’s notice of termination of an assignment provided under s. 74.10.1 based on what the employee would have earned had the assignment not been ended.
If the employee worked through the notice period then the employee is generally entitled to the wages actually earned. However, if an employee alleged that proper notice had not been provided because for example, no work was provided during the week of notice or the hours of work had been unilaterally reduced during the week of notice, the officer would have to determine whether the work arrangements during the week of notice were nonetheless reflective of the actual terms of the assignment. If they were not, the officer could conclude that the employee was not provided with the entitlement to the one week notice required under this section. For example, if the officer found the assignment employee’s hours were significantly reduced during the week of notice as compared to the weekly hours regularly worked by the employee, the officer may conclude that the employer failed to provide the notice required under this section and so assess for the difference between what was paid during the notice period and what the employee would otherwise have earned.
A determination as to what the employee would have earned during the notice period will depend on what the work arrangements actually were during the assignment. For example, if the employee had a regular work week and was paid on the basis of time, it would be reasonable to find that the employee’s entitlement during the one week notice period was equivalent to a regular week’s wages. Evidence as to what the employee’s regular wages were or what hours the employee worked in a regular work week might be found within the terms of the assignment or by reviewing the employee’s pay statements to see what the employee earned in the weeks preceding the week of notice, if that is different from the terms of assignment.
If the employee did not have a regular work week or was paid on a basis other than time, it would be reasonable in the absence of other evidence (e.g., a schedule showing the specific hours that the employee would have been required to work in the week of notice) to assess the entitlement on the basis of an average of weekly earnings. Factors an officer might consider in determining how to average earnings could include such things as whether there is any kind of repeating cycle with respect to hours of work, whether there has been a recent trend showing a reduction or an increase in hours worked and whether the employee has been absent from work because of illness or vacation. The officer may determine after reviewing all relevant factors that the most reasonable way to determine what the employee would have worked in the notice period is an average of the weeks worked at this assignment, or the last 12 weeks if greater than three months. If the officer has evidence from the employee or client business that the assignment for the week in question was to five days per week, even though the employee normally was assigned work for three days, the employee is entitled to five days pay in lieu of notice. For example, the client business was planning on attending a conference that week and required the assignment employee to answer the phones for five days that week, then the entitlement is five days even though the assignment was only for three days per week.
Subsection 74.10.1(1) permits a temporary help agency to pay termination of assignment pay in lieu of the notice. Subsection 74.10.1(2) provides that the pay in lieu of such notice must be equal to the amount the assignment employee would have received had the one week’s notice been given in accordance with s. 74.10.1(1).
Therefore, the Program’s policy regarding the calculation of the entitlement to pay during the working notice period where there is an allegation that proper notice has not been provided is also applicable when making the determination regarding the entitlement to pay in lieu when no notice is provided under s. 74.101.1(1). In situations where the assignment employee is working two or more assignments at the same time, and only has one assignment terminated, the termination of assignment pay in lieu of notice will be calculated to reflect only the wages the assignment employee would have earned had they continued with the terminated assignment. The wages the assignment employee earns for the separate assignments which are not terminated are not included in the calculations of termination of assignment pay.
Vacation pay accrues not only on an assignment employee's wages during the one week notice of termination of assignment set out in s. 74.10.1(1) but also on any pay in lieu of notice paid under s. 74.10.1(2). For example, if the assignment employee is entitled to $500 in respect of pay in lieu, the employee would also be entitled to a further amount of $20 or $30 for vacation pay based on the statutory minimum of four per cent or six percent in accordance with ESA Part XI, s. 35.2.
If the assignment employee’s contract of employment provides for vacation pay to be calculated at a greater rate, then the vacation pay should be calculated accordingly. Such vacation pay would be due and payable in accordance with ESA Part XI, s. 36 unless the employment relationship with the temporary help agency is terminated at the same time the assignment with the client of the agency is terminated, in which case all outstanding vacation pay would be due in accordance with ESA Part V, s. 11(5).
Under this subsection, the temporary help agency is not required to provide written notice of termination of assignment or pay in lieu to the assignment employee under s. 74.10.1(1), provided that the temporary help agency offers the assignment employee a work assignment with a client, which is reasonable under the circumstances with an estimated term of 1 week or more during the notice period. At least one week of the work assignment must coincide with the notice period to qualify under this section.
What is reasonable in the circumstances with respect to the offered work assignment will depend on the terms and conditions of the offer versus the assignment that is being terminated. For example, the officer might consider the hours of work, the work schedule, the nature of the work and the rate of pay for the work in deciding whether or not the assignment offered is reasonable.
In the event that the temporary help agency offers the assignment employee another assignment, which is reasonable under the circumstances and is of an estimated term of one week or more during the notice period, and the assignment employee refuses this offer, s. 74.10.1(1) will not apply, and the assignment employee will have no entitlement to notice of termination of assignment, nor to pay in lieu of notice of termination of assignment.
This subsection set outs three situations in which a temporary help agency is relieved of the obligation to provide an assignment employee with notice of termination of assignment in accordance with s. 74.10.1(1).
An assignment employee who has been guilty of wilful misconduct, disobedience or wilful neglect of duty that is not trivial and that has not been condoned by the temporary help agency or the client is not entitled to notice of termination of assignment or pay in lieu.
The rationale for this exemption is the view that a temporary help agency should not be obliged to provide an assignment employee with either notice of termination of assignment or pay in lieu of notice where that assignment employee was guilty of wilful misconduct, disobedience or neglect of duty.
This exemption will apply only if all of the following criteria are met:
As the following discussion demonstrates, this exemption is narrower than the concept of just cause applied in the common law and in collective agreement disputes. In other words, an arbitrator or a judge may find that there was just cause to dismiss an employee, but this does not necessarily mean that the exemption in s. 74.10.1(4)(a) applies.
This exemption is substantially the same as the exemption in O Reg 288/01, s. 2(1) para. 3, which applies with respect to the notice of termination of employment obligations in the Act.
An employee whose assignment has become impossible to perform or is frustrated by a fortuitous or unforeseeable event or circumstance is not entitled to notice of termination of assignment.
The effect of the exemption is to relieve the employer from the obligation to give notice of termination of assignment or pay in lieu of notice where there is a supervening unforeseeable event that strikes at the very root of the assignment that is not the fault of the employer and that is not provided for in the assignment itself.
The rationale for this exemption is the recognition that employers cannot give advance notice of termination of an assignment where the termination is caused by events that the employer cannot reasonably be expected to anticipate or foresee. It is also consistent with the common law view that frustration of a contract brings the contract to an end automatically by operation of law. For example, where frustration of an employment contract occurs, the common law does not regard the employer as having terminated the contract. In determining the applicability of the frustration and impossibility exemption it is important to bear in mind three general principles.
The question may arise as to whether an assignment would be frustrated or rendered impossible to perform because the assignment employee has been on a leave under Part XIV. Given that the assignment employee is exercising a statutory right, it is Program policy that the assignment would not be frustrated or rendered impossible to perform in these circumstances.
This exemption is similar the exemption in O Reg 288/01, s. 2(1) para. 4, which applies with respect to the notice of termination of employment obligations in the Act.
An assignment employee whose assignment is terminated as a result of a strike or lock-out at the location of the assignment is not entitled to notice of termination of assignment or pay in lieu.
The rationale for this exemption is that while the possibility that a strike or lock-out at the client business might occur therefore disrupting the client business, this is not a foreseeable event for the temporary help agency.
With respect to lock-outs, the exemption will apply only if the lock-out is a legal one under the Labour Relations Act, 1995, SO 1995, c 1, Sch A.
The exemption applies only if the strike or lock-out was at the location of the assignment. The term "location of the assignment” is not defined in the ESA 2000, and it is not necessarily the same as establishment as defined in ESA Part I, s. 1. When a client of a temporary help agency has plants across the province, does a strike at a plant in Thunder Bay, for example, constitute a strike at "location of the assignment” of an assignment employee who works at the client's Mississauga plant? The answer is no. "The location of the assignment" means the actual plant or office of the client where the assignment employee works.
The exemption applies when the employee's assignment is terminated during a strike or lock-out, or as a result of a strike or lock-out. The meaning of "during" a strike or lock-out is self-evident. An assignment employee whose assignment is terminated during a strike or lock-out, for whatever reason, would not be entitled to notice of termination of assignment or pay in lieu. Further, if an assignment employee was given notice of termination of assignment prior to a strike or lock-out but whose assignment was terminated (for example) during a subsequent strike and before the notice period had ended, this exemption would relieve the temporary help agency of any obligation with respect to the balance of the notice period or pay in lieu of notice. There is no requirement that the assignment employee be a member of the striking or lock-out bargaining unit.
More difficult is the concept of "as a result of" a strike or lock-out. It is Program policy that in order to take advantage of the exemption, the temporary help agency must show that the strike had adverse consequences to the client business and therefore necessitated the termination of the assignment. In this regard, see Hayes Danc Inc. operating as Spicer Reman Centre v 15 Employees (December 29, 1989), ESC 2609 (Solomatenko), a decision under the former Employment Standards Act with respect to notice of termination obligations under the former Act.
Furthermore, if the strike was little more than a catalyst, precipitating a closure that would have likely happened anyway, even without the strike, then a termination of an assignment will not be "as a result of" the strike within the meaning of the exemption. The strike must be the major cause of the termination of assignment in order for the exemption to apply. If the major cause is instead, for example, lower demand, increased competition, or aging equipment and processes, and the strike is merely "the straw that broke the camel's back", then the exemption will not apply. See Robson Lang Leathers Limited v Legacy et al (January 19, 1979), ESC 574 (Picher), a decision under the former Employment Standards Act with respect to notice of termination of employment obligations under the former Act.
This exemption is substantially the same as the exemption in O Reg 288/01, s. 2(1) para. 8, which applies with respect to the notice of termination of employment obligations in the Act.
Section 74.11 modifies the application of certain notice of termination and severance pay provisions in Part XV of the Employment Standards Act, 2000 insofar as assignment employees of temporary help agencies are concerned. Section 74.11 is in Part XVIII.1 (Temporary Help Agencies), which was added to the ESA 2000by the Employment Standards Amendment Act (Temporary Help Agencies), 2009 and came into force on November 6, 2009.
The modifications set out in paragraphs 1 through 14 of s. 74.11 primarily clarify how and when a termination or severance is triggered by a layoff and how termination and severance pay are calculated for assignment employees. As amended by the Good Government Act, 2009, s. 74.11 also modifies the circumstances under which mass notice entitlements are triggered for assignment employees. Sections of Part XV not modified by s. 74.11 apply as written to assignment employees and their temporary help agency employers.
It should be noted that transitional provisions regarding the application of s. 74.11 are contained in O Reg 398/09 which is a defined industry regulation for the temporary help agency industry. While most of the regulation is now of historical interest only, it is important to note that the regulation clarifies that nothing in the regulation shall be interpreted to exclude time spent by an assignment employee in the employ of a temporary help agency before November 6, 2009 for the purposes of determining an entitlement under Part XV. This rule applies for purposes of references in the Act or regulations to "period of employment", "continuous employment", "employment whether or not continuous and whether or not active" and "number of years or months of employment".
For a detailed discussion, see O Reg 398/09.
Section 74.11 was amended by the Good Government Act, 2009 to provide that on or after November 6, 2009, the trigger for mass notice entitlements set out in s. 58(1) of the ESA 2000 no longer applies with respect to assignment employees. Instead, assignment employees are entitled to an equivalent number of weeks of "mass" notice as are provided to non-assignment employees (in accordance with s. 3(1) of O Reg 288/01) if the assignments of 50 or more assignment employees at a single client's establishment ended or were ended and, as a result, the agency terminated the employment of 50 or more such employees within a four-week period.
Note that pursuant to s. 74.2, Part XVIII.1 of the Act does not apply to those assignment employees who provide professional services, personal support services or homemaking services as defined in the Long -Term Care Act, 1994, SO 1994, c 26 (renamed the Home Care and Community Services Act, 1994 as of July 1, 2010) if the assignment is made under a contract between the employee or his or her employer and a community care access corporation within the meaning of the Community Care Access Corporations Act, 2001, SO 2001, c 33. As a result, Parts X and XV of the ESA 2000 apply without modification to these employees.
The provisions of O Reg 288/01 (as amended) generally apply to temporary help agencies and assignment employees to whom Part XVIII.1 applies.
One issue with respect to the application of O Reg 288/01 concerns the "term or task" exemption from notice in para. 1 of s. 2(1). That exemption applies to relieve employers from the requirement to provide notice of termination or termination pay to an employee who is "hired on the basis that his or her employment is to terminate on the expiry of a definite term or completion of a specific task".
Generally speaking, the term or task exemption would rarely, if ever, apply to assignment employees because of the nature of the employment relationship between assignment employees and temporary help agencies. That employment relationship is described in s. 74.3 as arising when the parties agree that the employee is hired for the purposes of being assigned to perform work on a temporary basis for clients or prospective clients of the agency. In addition, s. 74.4 clarifies that the end of a work assignment does not in and of itself terminate the employment relationship between the agency and an assignment employee.
In other words, the employment relationship is premised on an agreement that the agency will place or seek to place the assignment employee in assignments and the employment relationship continues between such assignments unless it is otherwise terminated. As a result, even though an assignment (to a client) might be for a specific term or task, generally the employment (with the agency) is not; the ending of the assignment will not in and of itself end the employment relationship or in and of itself attract the application of the term or task exemption in s. 2(1) para. 1 of O Reg 288/01.
That is not to say however, that an agency could not employ an assignment employee on a term or task basis. If, for example, an agency hires an employee for the purposes of placing them in an assignment with a defined term or task and the understanding of the parties is that the employment relationship will terminate at the end of that assignment, and it does, the term or task exemption might be applicable, depending on all the facts, subject to s. 2(2) of the regulation. Again, whether or not an assignment employee is employed on a term or task basis must be determined on the particular facts of each case.
A second issue regarding the application of O Reg 288/01 concerns the exemptions from notice and severance entitlements in para. 5 of s. 2(1) and para. 4 of s. 9(1) of the regulation where the employee is terminated after refusing an offer of reasonable alternative employment with the employer. The question posed is whether in refusing an assignment (e.g. of a type contemplated by the contract of employment between the agency and the assignment employee) would be considered a refusal of an offer of reasonable alternative employment. The Program's position is that an offer of a work assignment to perform work for a client on a temporary basis cannot constitute an offer of "reasonable alternative employment". The Act defines the employment relationship between an assignment employee and temporary help agency by the fact that the agency will assign or attempt to assign the employee to perform work on a temporary basis. As a result, an offer of an assignment is not an offer of alternative employment.
The situation would be different if a temporary help agency were offering an assignment employee employment (for example) as the agency's own permanent full-time front desk receptionist. In that case, the agency would be offering alternative employment (as opposed to an offer of an assignment to perform work for a client of the agency). If the offer of such alternative employment were refused and the agency terminated the employment of the employee, the question would be whether the offer was reasonable for the purposes of applying the exemptions in para. 5 of s. 2(1) and para. 4 of s. 9(1).
A third issue regarding the application of O Reg 288/01 concerns s. 6 of the regulation. That section provides that where an employee has been given notice of termination in accordance with the Act and regulations, the employer may provide temporary employment within the 13-week period following the termination date without affecting the date of termination or the employee's period of employment.
As noted in the preceding discussion, the employment relationship with an assignment employee is defined by the agency hiring an assignment employee for the purpose of assigning or attempting to assign the employee to perform work for clients of the agency. Further, the ending of an assignment does not in and of itself end the employment relationship - see ESA Part 18.1, s. 74.3 and s. 74.4.
Unless the employer had given notice of termination to take effect on a specific date, an offer of a new assignment to perform work within 13 weeks after the preceding assignment ended would simply be an offer of a work assignment within the ongoing employment relationship, as opposed to an offer of "temporary work" that delays actual termination (but not the legal termination date) under s. 6 of O Reg 288/01.
Similarly, it is important to distinguish between the end of an assignment and the termination of the employment relationship in applying s. 8(2) of O Reg 288/01. Section 8 operates to tie together periods of employment separated by 13 weeks or less for the purposes of determining entitlements to notice of termination or pay in lieu of notice. Unless the employment relationship is terminated, s. 8(2) has no application. For example, even though an assignment has ended, unless the employment relationship is also terminated when the assignment ends, the employment relationship is ongoing. All time employed (including periods of time between assignments) is included for determining both eligibility and the amount of the notice entitlement. For a more detailed discussion, see O Reg 288/01, s. 8(2).
For most employees, s. 56(3.1) defines a week of lay-off as a week, other than an "excluded week", in which the employee earns less than one-half of his regular wages. However, for assignment employees, this definition is displaced by paragraph 1 of s. 74.11. Under paragraph 1, a week of lay-off is a week in which an assignment employee "is not assigned by the agency to perform work for a client of the agency, during the week".
"Assigned by the agency to perform work" refers to being on an assignment to perform work for a client of the agency. Once an employee has commenced an assignment with a client of the agency he or she is considered to be assigned by the agency to perform work (or on assignment) for that client until the assignment ends - see ESA Part 18.1, s. 74.4(2). As a result, despite the fact that an employee may not actually have performed any work for the client in a given week during the course of the assignment, that week would not be considered a "week of lay-off". For example, assume an agency assigned an employee to a 6 month term assignment with one of its clients. Pursuant to the terms of the assignment, the employee regularly worked Monday through Friday each week. However, the client unexpectedly shut down for a few weeks during the course of the six-month assignment. Despite not performing any work for the client in those weeks, the assignment employee is not considered to have been on lay-off during those weeks, as the employee continued to be on assignment during those weeks. This underscores the fact that, in contrast to the situation under subsection 56(3.1), a week of lay-off for an assignment employee is not defined on the basis of the extent to which earnings have been reduced.
This paragraph must be read subject to the definition of "excluded week" in paragraph 2 as well as paragraph 3 which provides that an excluded week is not counted as a week of lay-off but is included in the 20 or 52 week period within which weeks of lay-off are counted for the purposes of determining whether a termination is triggered.
Note that with respect to assignment employees of temporary help agencies, O Reg 398/09 specifies that "weeks of lay-off as well as the periods of 20 or 52 consecutive weeks (within which weeks of lay-off are counted) are to be counted only from November 6, 2009 forward for the purposes of triggering termination (and severance)."
This provision displaces, in the case of assignment employees, the definition of "excluded week" found in s. 56(3) and s. 63(2) of the Act. It defines an excluded week as a week during which for one or more days the employee is not able to work, is not available for work, refuses an offer by the agency that would not constitute constructive dismissal of the employee by the agency, or is subject to disciplinary suspension. It also specifies that an excluded week is a week in which the employee is not assigned to perform work because of a strike or lock-out at the agency as compared to "a strike or lock-out occurring at [the employee's] place of employment or elsewhere". Note: the underlined text highlights differences between the definitions in s. 56(3), s. 63(2) and s. 74.11 para. 2.
The definition of excluded week is relevant for the purposes of paragraph 3 of s. 74.11, which provides that an excluded week is not counted as a week of lay-off but is counted as part of the period of consecutive weeks within which the specified weeks of lay-off must fall in order to trigger a termination under s. 56(1)(c).
These situations are discussed in more detail below:
A week in which an assignment employee is unable to work because of illness or injury for one or more days is an excluded week and is not considered to be a week of lay-off even if the employee has not been assigned to perform work during that week.
A week in which for one or more days an assignment employee is "not available to work" (say because he or she was taking time off for personal reasons) is an excluded week and is not considered to be a week of lay-off, even if the employee had not been assigned to perform work during that week. "Personal reasons" would include (for example) being on a personal emergency, pregnancy or parental leave.
Availability is a question of fact. In practice, the question of whether an employee is available for work or not would often be answered directly by the employee at the time the agency offers an assignment. In other cases, such as where the employee has not been offered an assignment by the agency in a given week, the question of availability must be answered on the basis of whether the employee could and would have been available for work had the agency offered him or her an assignment. The fact that an employee was working elsewhere during the week does not necessarily mean that he or she is not available to work.
For example, if an assignment employee of temporary help agency A is assigned to perform work for a client of agency B or has taken direct employment with employer C (assuming that the employee has not frustrated his or her contract of employment with agency A by taking such work) those weeks may, depending on the circumstances, still be weeks in which the employee was available for work vis á vis agency A and in that case would be considered weeks of lay-off as far as agency A's notice (and severance pay) obligations are concerned.
Paragraph 2 of s. 74.11 includes within the definition of "excluded week" a week in which for one or more days, an assignment employee refuses an offer by an agency that would not constitute a constructive dismissal. For example, if the employment contract specified that the agency would offer the assignment employee positions of particular kind or with specific hours or pay, an offer that was substantially different to what was contemplated in the contract and was adverse to the employee could constitute a constructive dismissal. A discussion of general principles that may have application to the determination of whether an offer of an assignment would constitute a constructive dismissal can be found in ESA Part XV, s. 56(1).
In cases where there is a dispute as to the terms of the employment contract, it is necessary to consider both implicit and explicit terms. Implicit terms are often not in writing and may be established by past practice or custom or judicial ruling. Explicit terms and conditions of employment might be the subject of an oral or written employment contract or may be contained in oral or written workplace policies.
For example, an assignment employee has worked for an agency for several years and has been offered and accepted temporary work assignments paying anything between the minimum wage rate and three or four times that rate; in the absence of any evidence to suggest the terms or conditions of employment have changed, an officer could find there is an implicit term that offers of such assignments are acceptable under the contract of employment. As a result, a week in which the employee refused an offer of an assignment paying the minimum wage would be an excluded week and not a week of lay-off.
It should be remembered that the purpose of this paragraph is not to find a constructive dismissal under s. 56(1)(b) (or s. 63(1)(b)), which results in termination (or severance) only if the employee actually resigns, but rather to identify a job offer as one which would constitute a constructive dismissal. The purpose of the section is to identify weeks that are excluded within the meaning of s. 74.11 para. 2, and so determine if and when a termination is or will be triggered by a lay-off under s. 56(1)(c).
An employee who is on disciplinary suspension is not on a week of lay-off. It is important to ensure, though, that the disciplinary suspension is bona fide and is pursuant to established company rules and procedures or a contract of employment.
Where an assignment employee is not provided with work during a week by the agency due to a strike or lock-out at the agency, the employee is not on a week of lay-off. Note that in contrast, under s. 56(3) and s. 63(2), the strike or lock-out may occur at the employee's place of employment or elsewhere.
It is the Program's position that in order to characterize a week of lock-out as an excluded week, the lock-out by the employer must be a legal one under the Labour Relations Act, 1995, SO 1995, c 1, Sch A. In those circumstances, the employer's failure to provide work flows from the right to lock out the employees under the Labour Relations Act, 1995 and the employer should not suffer any adverse consequences for exercising that right.
On the other hand, if the lock-out is illegal, the failure to provide work is not permissible under Labour Relations Act, 1995. As a consequence, the Program's position is that a week in which employees are illegally locked out is a week of lay-off. However, a week of strike, whether illegal or legal, will be considered by the Program to be an excluded week (i.e. not a week of lay-off) because the employer does not in those circumstances have any control over whether work is provided.
Paragraph 3 describes the effect of excluded weeks in counting weeks of lay-off and establishing the period within which those weeks are counted to trigger a termination of employment by lay-off. It effectively displaces ss. 56(3.2), (3.4) and (3.6). An excluded week is not counted as a week of layoff but is included in the period of 20 or 52 consecutive weeks for the purposes of determining whether a period of temporary lay-off as defined in s. 56(2) has been exceeded, thereby triggering a termination under s. 56(1)(c).
As was noted above, because the temporary lay-off rules for assignment employees of temporary help agencies introduce a new regime for such employees effective November 6, 2009, it is program policy that the new regime applies only in respect of lay-offs that occur on or after that date (or, where a lay-off began before that date, only in respect of that portion of the lay-off that began on that date). Similarly, for purposes of the 20-consecutive week period or 52-consecutive week period that one looks to in order to determine whether there have been a sufficient number of weeks of lay-off within that period to trigger a termination, only weeks that begin on or after November 6th, 2009 are taken into account.
Paragraph 4 states that s. 56(3) to s. 56(3.6) of Part XV do not apply with respect to assignment employees of temporary help agencies. Those subsections a) define a "week of lay-off" with respect to both employees who have a regular work week and employees who do not have a regular work week, b) define an "excluded week" and c) provide that excluded weeks are not included when counting weeks of lay-off but are included when counting 20 or 52 consecutive weeks for the purposes of determining whether a lay-off exceeds a period of temporary lay-off so as to trigger a termination under s. 56(1)(c). For the purposes of determining entitlements to notice and termination for assignment employees, ss. 56(3) to (3.6) are effectively displaced by paragraphs 1, 2 and 3 of s. 74.11.
With the exception of the changes made by paragraphs 4.1, 4.2, 4.3, and 5 of s. 74.11, the balance of the mass notice provisions in s. 58 of the Act and in s. 3 of O Reg 288/01 otherwise apply as written to temporary help agencies with respect to their assignment employees.
Paragraph 4.1 of s. 74.11 provides that on or after November 6, 2009, s. 58(1) of the ESA 2000 does not apply to a temporary help agency in respect of its assignment employees.
As of that date, an assignment employee's right to mass notice of termination is triggered under the circumstances as set out in paragraph 4.2, which provides that notice entitlements as per paragraph 4.3 must be provided to assignment employees if the assignments of 50 or more assignment employees at a single client's establishment ended or were ended and as a result, the temporary help agency terminated the employment of 50 or more such employee within a four-week period.
Paragraph 4.2 provides that as of November 6, 2009, an assignment employee would only be entitled to mass notice where he or she was one of 50 or more assignment employees who had been on assignment at a client's establishment and who were terminated within a four-week period by the agency because the assignments of those 50 or more assignment employees ended or were ended by the client or the agency.
Paragraph 4.3 sets out the mass notice of termination entitlements when 50 or more assignment employees are terminated as per paragraph 4.2 as follows:
Note that the number of weeks of mass notice that assignment employees are entitled to under paragraph 4.3 of s. 74.11 are the same as those to which non-assignment employees are entitled to pursuant to s. 58(1) of the Act and s. 3(1) of O Reg 288/01.
As noted above, O Reg 398/09 provides that as of November 6, 2009, the four-week periods within which terminations are to be counted for the purposes of triggering a mass notice entitlement for assignment employees must either end before November 6, 2009 or begin on or after November 6, 2009. As a result, s. 58(1) of the Act and s. 3(1) of O Reg 288/01 would apply to determine the mass notice entitlements of assignment employees if they were one of at least 50 employees terminated in a four-week period ending before November 6, 2009 (assuming they were not exempt from notice because they were "elect to work" employees). Paragraphs 4.2 and 4.3 of s. 74.11 would apply to determine the mass notice entitlements of assignment employees if they were terminated in a four-week period beginning on or after November 6, 2009.
Paragraph 5 modifies the requirements to provide certain information to assignment employees when giving notice of a mass termination in accordance with paragraph 4.3.
In addition to the requirements in s. 58(2)(b) and s. 58(5) to post certain information in the workplace, paragraph 5 of s. 74.11 states that the information provided to the Director of Employment Standards under clause 58(2)(a), must also be provided individually to each assignment employee who is entitled to mass notice in accordance with para. 4.3, by the temporary help agency on the first day of the notice period or as soon after that as is reasonably possible.
The information that must be provided to each assignment employee is the prescribed information provided to the Director in a Form 1 (the form approved by the Director).
Note that paragraph 5 does not specify how the information is to be provided; there is no requirement that it be provided in writing.
If the information is not provided on the first day of notice it must be provided as soon after that date as is reasonably possible. A determination of what is reasonable will depend upon all of the facts.
As noted above, all other provisions in Part XV of the Act and O Reg 288/01 related to mass notice will apply to assignment employees without modification. See the discussions regarding mass notice entitlements in the manual at ESA Part XV, s. 58 and O Reg 288/01, s .3.
Paragraph 6 states that s. 60(1)(a) and (b) and s. 60(2) of Part XV do not apply to temporary help agencies and their assignment employees. Those provisions prohibit the employer from altering the wage rate during a notice period under s. 57 or s. 58. They also require the employer to pay during each week of notice the wages the employee is entitled to receive (i.e., what is earned during that week) and in no case to pay less than his or her regular wages for a regular work week, and if the employee does not have a regular work week, no less than the average amount of regular wages earned per week in each week of work in the 12 weeks preceding the date notice was given.
Paragraph 7 sets out the method for calculating entitlements to pay during each week of a notice period with respect to assignment employees of temporary help agencies. It effectively replaces the provisions for calculating pay during the notice period as they are set out in s. 60(1)(a), (b) and s. 60(2). It should be noted that where notice is not given, the entitlement to pay in lieu of notice (see paragraph 8 below) is based on the amounts to which the employee would be entitled, had notice been given, under paragraph 7.
If the termination is triggered under s. 56(1)(a) or (b) (i.e., is not triggered by a lay-off that exceeded a period of temporary lay-off) the agency is required to pay during each week of notice, the greater of:
Note that b) refers to all wages earned in the 12 week period including overtime pay, public holiday pay, premium pay and vacation pay. It refers to the wages earned for work performed for all clients of the agency within the 12 week period if there is more than one - not just the last client in that period for whom work was performed.
If the termination is triggered under s. 56(1)(c) (i.e., by a lay-off that exceeded a period of temporary lay-off), the agency is required to pay during each week of notice, the greater of:
Note that b) refers to all wages earned in the 12 week period preceding the deemed termination date, including overtime pay, public holiday pay, premium pay and vacation pay. It refers to the wages earned for work performed for all clients of the agency within the 12 week period if there is more than one - not just the last client in that period for whom work was performed. When a termination is triggered by a layoff that exceeds a period of temporary lay-off pursuant to s. 56(1)(c) the deemed termination date is the first day of the lay-off as per s. 56(5). For the purposes of triggering a termination under s. 56(1)(c), weeks of lay-off are counted in accordance with s. 74.11 paras. 1 through 4.
With respect to the calculation of termination pay during the period of working notice described in ii) above, it should be noted that generally, the ability to provide working notice under the ESA when a termination is triggered by a lay-off that exceeds a period of temporary lay-off, is limited to situations in which an employer who is bound by a collective agreement gives working notice of an indefinite lay-off and the lay-off does in fact exceed a period of temporary lay-off. Such a notice is treated as a notice of termination pursuant to s. 4(2) of O Reg 288/01 - see O Reg 288/01, s. 4(2) for a discussion of this provision. A non-union employer could give notice of termination in anticipation of a future lay-off that it expects will last longer than a period of temporary lay-off, but technically, in that case, the termination is effected by the notice itself, resulting in a termination under clause 56(1)(a) rather than by a lay-off exceeding a period of temporary lay-off.
Paragraph 8 sets out how to calculate pay in lieu of notice for an assignment employee. Under paragraph 8, the pay in lieu of notice entitlement for an assignment employee is the lump sum equal to the total amount the employee would have been entitled to receive during a period of working notice as calculated under paragraph 7 above.
Paragraph 9 states that s. 61(1.1) which provides a method of calculating pay in lieu of notice for employees who do not have a regular work week does not apply to temporary help agencies and their assignment employees.
Paragraph 9.1 provides that reference to s. 58 in s. 63(1)(e) is read as a reference to paragraph 4.3 of s. 74.11 with respect to assignment employees.
Section 63(1)(e) provides that a severance occurs if an employer has provided notice of termination in accordance with s. 57 or s. 58 of the Act and the employee resigns during the statutory notice period by giving the employer two weeks' written notice of the resignation.
As a result of paragraph 9.1, s. 63(1)(e) is read with respect to assignment employees as referring to a notice of termination under s. 57 and mass notice of termination under paragraph 4.3 of s. 74.11 instead of s. 58.
Paragraph 10 of s. 74.11 describes the effect of excluded weeks for the purposes of determining whether a severance is triggered by a lay-off. Specifically, an excluded week is not counted as a week of lay-off but is included in the period of 52 consecutive weeks for the purposes of determining whether a severance has been triggered by a lay-off of 35 weeks or more in a period of 52 consecutive weeks as set out in s. 63(1)(c).
Paragraph 11 provides that the provisions in Part XV which define a "week of lay-off", define an "excluded week" and describe the effect of such excluded weeks (ss. 63(2) to 63(2.4)) do not apply in respect of assignment employees. Those provisions of s. 63 are effectively displaced by paragraphs 1, 2 and 10 of s. 74.11.
Note that with respect to assignment employees of temporary help agencies, O. Reg. 398/09 specifies that weeks of lay-off as well as the period of 52 consecutive weeks (within which weeks of lay-off are counted) are to be counted only from November 6, 2009 forward for the purposes of triggering severance.
Section 74.11 para. 1 reads as follows:
Under paragraph 1, a "week of lay-off" for the purposes of the application of Part XV and specifically the application of s. 63(1)(c), is a week in which an assignment employee "is not assigned by the agency to perform work for a client of the agency, during the week". This provision effectively replaces ss. 63(2.1) and (2.3) of Part XV, which specify what a week of lay-off means with respect to an employee who has a regular work week and an employee who does not have a regular work week for severance purposes.
Unlike the Part XV provisions (ss. 63(2.1) and (2.3)) displaced by this paragraph, a week of lay-off is not defined on the basis of a reduction in earnings.
This paragraph must be read subject to the definition of excluded week in paragraph 2 as well as paragraph 10 which provides that an excluded week is not counted as a week of lay-off but is included in the 52 week period within which weeks of lay-off are counted for the purposes of determining whether a severance is triggered. As noted above, it is the Program's position that weeks prior to November 6, 2009 will not be counted for the purposes of triggering a severance by lay-off.
Section 74.11 para. 2 reads as follows:
This provision displaces the definition of "excluded week" found in s. 63(2) of the Act by defining "excluded week" for the purposes of applying the severance provisions in Part XV to assignment employees as a week during which for one or more days the employee is not able to work, is not available for work, refuses an offer by the agency that would not constitute constructive dismissal of the employee by the agency, or is subject to disciplinary suspension. It also specifies that an excluded week is a week in which the employee is not assigned to perform work because of a strike or lock-out at the agency as compared to "a strike or lock-out occurring at [the employee's] place of employment or elsewhere".
Note: the underlined text highlights differences between the definitions in s. 63(2) and s. 74.11 para. 2.
Paragraphs 12, 12.1, 13 and 14 of section 74.11 modify the application of certain provisions in section 65 related to the calculation of severance pay with respect to assignment employees.
Paragraph 12 provides that ss. 65(1), (5) and (6), which set out the method for calculating the severance pay entitlements for employees who have a regular work week and employees who do not have a regular work week as well as establishing the maximum severance pay (26 weeks), do not apply to assignment employees. These provisions are effectively displaced insofar as assignment employees are concerned by paragraphs 13 and 14 of s. 74.11.
Paragraph 12.1 provides that s. 65(4), which specifies severance pay is to be calculated as including the period of time for which notice should have been given under s. 57 or s. 58 but was not, is to be read as referring to the notice that should have been given under s. 57 or paragraph 4.3 of s. 74.11.
In accordance with paragraph 13, a qualified assignment employee whose employment is severed other than through a lay-off that exceeds 35 weeks in a period of 52 consecutive weeks is entitled to an amount as calculated under paragraph 13.
Note that clause i refers to all wages earned in the 12-week period ending on the last day that the employee performed work for a client of the agency, including overtime pay, public holiday pay, premium pay and vacation pay. It refers to the wages earned for work performed for all clients of the agency within the 12-week period if there is more than one - not just the last client in that period for whom work was performed.
The total amount of wages earned in the 12-week period is divided by 12 to represent a week's severance pay. That amount is multiplied by the number of weeks of severance pay that the employee is entitled to (to a maximum of 26 weeks). The number of weeks of severance to which the employee is entitled is the number of completed years of employment plus completed months of employment (the latter divided by 12).
Paragraph 14 applies to determine severance entitlements when the employment of an assignment employee is severed because of a lay-off that equals or exceeds 35 weeks in a period of 52 consecutive weeks pursuant to s. 63(1)(c).
Note that clause i refers to all wages earned in the 12-week period immediately preceding the first day of the lay-off, including overtime pay, public holiday pay, premium pay and vacation pay. It refers to the wages earned for work performed for all clients of the agency within the 12-week period if there is more than one - not just the last client in that period for whom work was performed.
The total amount of wages earned in the 12-week period is divided by 12 to represent a week's severance pay. That amount is multiplied by the number of weeks of severance pay that the employee is entitled to (to a maximum of 26 weeks). The number of weeks of severance to which the employee is entitled is the number of completed years of employment plus completed months of employment (the latter divided by 12).
This provision was added by the Good Government Act, 2009, SO 2009, c 33. It is a transition provision that allows the new "mass" notice rules in section 74.11 para. 4.3 to apply as if they had been in force on November 6, 2009 (when Part XVIII.1 came into force.)
Section 74.11 para. 4.3 provides that (in the circumstances described in para. 4.2 of s. 74.11) assignment employees are entitled to notice of termination of at least:
Paragraph 4.2 of s. 74.11 provides that the notice requirements in paragraph 4.3 apply if 50 or more assignment employees who were assigned to perform work for the same client of the agency at a single establishment of that client were terminated in the same four-week period and the terminations resulted because the term of the assignments ended or the assignments were ended by the agency or client. Note that paragraph 4.1 of s. 74.11 also provides that s. 58(1) does not apply to assignment employees of temporary help agencies as of November 6, 2009.
See the discussion in ESA Part XVIII.1, s. 74.11 regarding paragraphs 4.2 and 4.3.
This anti-reprisal provision was introduced by the Employment Standards Amendment Act (Temporary Help Agencies), 2009, and came into force on November 6, 2009. Clauses (v. 1), (v.2) and (v.3) were later added to s. 74.12(1)(a) pursuant to the Fair Workplaces Better Jobs Act, 2017 effective April 1, 2018 to provide additional protections in the context of section 42.2, which establishes equal pay for equal work on the basis of assignment employee status. Clauses (v.1), (v.2) and (v.3) were subsequently amended pursuant to the Making Ontario Open for Business Act, 2018 effective January 1, 2019 to reflect the repeal of section 42.2.
Section 74.12 prohibits a client of a temporary help agency from reprising against an assignment employee of the agency on the same grounds as are set out in ESA Part XVIII, s. 74 and also:
This provision is otherwise virtually identical to ESA Part XVIII, s. 74, which prohibits reprisals by an employee's employer. Note that reprisals by a temporary help agency as an employer of an assignment employee continue to be prohibited under s. 74.
The intention of s. 74.12 is to ensure that assignment employees can pursue their rights under the Act and participate in proceedings under the ESA 2000 or s. 4 of the Retail Business Holidays Act, RSO 1990, c R.30 free from any reprisal by a client of their temporary help agency employer.
There are no eligibility requirements. Section 74.12 applies to clients of temporary help agencies and any person who falls within the definition of assignment employee in ESA Part I, s. 1(1) and who is not otherwise excluded from the application of Part XVIII.1 by ESA Part XVIII.1, s. 74.2.
A contravention of s. 74.12 may result in an order for compensation and/ or reinstatement into an assignment that is issued under ESA Part XVIII.1, s. 74.17 rather than a compensation and/or reinstatement order issued under ESA Part XXII, s. 104. Note that s. 104 orders can be issued for contraventions of Part XIV, Part XVI, Part XVII and Part XVIII only. In addition to an order under s. 74.17, an employment standards officer may also issue a compliance order to a client under ESA Part XXII, s. 108 and/or a notice of contravention under ESA Part XVII, s. 113.
See the discussion of the enforcement mechanisms of reinstatement and compensation in ESA Part XVIII.1, s. 74.17.
The Program has developed a four-step test in determining whether a reprisal occurs under ESA Part XVIII, s. 74 and this same approach (modified as necessary) is used when applying s. 74.12.
The four-step test in the context of client reprisals is set out below:
If all four questions are answered in the affirmative, a breach of s. 74.12(1) is established. Note that s. 74.12(2) places the burden of proof on the client in the context of an allegation of reprisal subject to ESA Part XXIII, s. 122(4), which provides that where there is a review of a notice of contravention, the onus is on the Director of Employment Standards to establish on a balance of probabilities that the person against whom the notice was issued contravened the provisions of the ESA 2000 as indicated in the notice of contravention.
Each aspect of the test is discussed in more detail below:
Is the person alleged to have committed a reprisal against an assignment employee a client of the temporary help agency that employs that assignment employee, or a person acting on behalf of such a client?
In determining whether a reprisal has occurred, it is necessary to first determine whether the person allegedly reprised against is an assignment employee of a temporary help agency and secondly, whether the person alleged to have committed the reprisal is the client of the temporary help agency or a person acting on behalf of a client of the temporary help agency that employs the assignment employee.
A temporary help agency is defined in ESA Part I, s. 1(1). An agency employs "assignment employees" for the purpose of assigning or attempting to assign the employee to perform work for clients of the agency on a temporary basis. Pursuant to ESA Part XVIII.1, s. 74.3, the employment relationship between the agency and the assignment employee is established where the parties agree (whether or not such agreement is in writing) that the agency will assign or attempt to assign the employee to perform work on a temporary basis for clients.
The definition of assignment employee in ESA Part I, s. 1(1) refers to an employee which is defined in ESA Part I, s. 1 to include a person who was an employee. Accordingly, an individual continues to be protected from a reprisal by a client of the agency for having engaged in a protected activity while they were employed by the agency, even after the individual’s employment has terminated.
For a detailed discussion of these protected activities under ESA Part XVIII, s. 74, see the discussion of step three of the four-part reprisal test>, which is relevant, with necessary modifications, in applying s. 74.12(1)(a)(i)-(viii) and s. 74.12(1)(b).
Because s. 74.12 applies only to assignment employees (which as per the above discussion includes a person who was an assignment employee), prospective assignment employees are not accorded the anti-reprisal protection of s. 74.12. However, it is important to note that once an individual becomes an assignment employee, a client of the agency may be subject to the prohibitions in s. 74.12 with respect to that assignment employee, even though the assignment employee had not yet commenced an assignment with the client. (For an example of when this might occur, see the discussion under Step 2 below.)
Client is defined in ESA Part I, s. 1(1) as a person or entity having an arrangement with a temporary help agency under which the agency agrees to assign or attempt to assign its assignment employee(s) to perform work for the person or entity on a temporary basis. As a result, a client is prohibited from reprising against an assignment employee in s. 74.12 whether or not the assignment employee had been placed with the client. For an example of when this might occur, see the discussion under Step 2 below.
A client is also bound by the actions of those persons who act on its behalf. The phrase "acting on behalf of such a client" is not a defined term. It is Program policy that the phrase be interpreted broadly, in the same way the phrase "on behalf of the employer" is interpreted broadly for the purposes of ESA Part XVIII, s. 74. As person acting on behalf of a client may therefore include:
See the discussion in ESA Part I, s. 1 regarding the terms "temporary help agency", "assignment employee" and "client" referenced above and ESA Part XVIII.1, s. 74.3 regarding the employment relationship between an assignment employee and a temporary help agency.
Did the client or person acting on behalf of the client intimidate an assignment employee, refuse to have an assignment employee perform work for the client, terminate the assignment of an assignment employee, or otherwise penalize an assignment employee or threaten to do so?
The second step of the test requires a determination that there has been a reprisal. Section 74.12(1) is similar to the prohibition against reprisals in ESA Part XVIII, s. 74(1). However, what may constitute a reprisal under s. 74.12(1) includes terminating the assignment of an assignment employee and /or refusing to have an assignment employee perform work for the client rather than dismissing an employee. This change reflects the fact that assignment employees are employed by the agency rather than the client, and as a result, the client is not in a position to reprise against an assignment employee through a dismissal.
There are potentially a number of ways in which a client could reprise against an assignment employee by terminating the assignment of an assignment employee or refusing to have an assignment employee perform work for the client. They would include:
An assignment employee was on a four-month assignment with a client and two weeks into the assignment, asked the client whether they have a right to meal breaks. Annoyed by the inquiry, the client decided to end the assignment and asked the temporary help agency to find them a replacement for the balance of the four-month assignment.
An agency and client entered into an arrangement for a six-month assignment. The assignment employee who was the subject of the arrangement happened to be seven months' pregnant at the time. When the assignment employee arrived at the client's office, the client advised her she would not be suitable for the job because it appeared she would have to stop working to take a leave when the baby was born. She was told to go back to the agency and the client cancelled the contract with the agency.
A client of a temporary help agency was seeking an assignment employee for a one-year assignment. The client interviewed several assignment employees for the placement and ultimately advised the agency that they had identified one individual as a tentative candidate for the position. However, the client asked the agency to first obtain an agreement from the assignment employee to work on all public holidays falling in the one-year assignment, before offering the assignment to the employee. The agency informed the client that the assignment employee in question refused to sign such an agreement. The client responded by telling the agency they were no longer interested in that particular assignment employee and asked the agency to ensure that any other employees sent for an interview had already signed such an agreement.
For a discussion of what actions may constitute a reprisal under ESA Part XVIII, s. 74(1), see the discussion of step two of the four-step test. That discussion is relevant, with necessary modifications, in applying s. 74.12.
Did the assignment employee engage in any of the protected activities set out in s. 74.12(1)(a) or s. 74.12(1)(b)?
Under s. 74.12(1)(a), a client of a temporary help agency is prohibited from reprising against an assignment employee because the assignment employee engages in any of the activities listed in clauses (i) to (viii) and s. 74.1(1)(b).
These listed activities are identical to those in s. 74(1)(a) with the exception of five clauses.
Per s. 74(1)(a)(i) the employer is prohibited from reprising against an employee because the employee asks the employer to comply with this Act and the regulations. Pursuant to s. 74.12(1)(a)(i), a client is prohibited from reprising against an assignment employee because the assignment employee asks the client or the temporary help agency to comply with its respective obligations under this Act and the regulations.
In other words, a client will contravene this section not only if it reprises against the assignment employee for asking the client itself to comply with the Act and regulations, but also for reprising against the assignment employee for asking the temporary help agency to comply with their obligations under the Act and regulations.
Per s. 74(1)(a)(v.1), the employer is prohibited from reprising against an employee because the employee makes inquires about the rate paid to another employee for the purpose of determining or assisting another person in determining whether an employer is complying with Part XII (Equal Pay for Equal Work).
Pursuant to s. 74.12(1)(a)(v.1), a client is prohibited from reprising against an assignment employee because the assignment employee makes inquires about the rate paid to an employee of the client for the purpose of determining or assisting another person in determining whether a temporary help agency complied with section 42.2 when it was in force.
This protection applies to inquiries made to the client, the client’s employees, or to anyone else.
Section 42.2, which provided equal pay for equal work on the basis of assignment employment status, was repealed effective January 1, 2019. Accordingly, the question might arise as to what reprisal protection exists in relation to this repealed provision.
Section 74.12(1)(a)(v.1) provides protection against reprisal where an employee made inquiries about the rate that was paid to an employee of the client both during the timeframe that s. 42.2 was in effect (from April 1, 2018 to December 31, 2018) and after its repeal where the purpose of the inquiries is to determine, or to assist another person in determining, whether an employer was in compliance with section 42.2.
In other words, the specified inquiries are protected regardless of when they occurred, as long as they relate to a rate that was paid when s. 42.2 was in force (from April 1, 2018 to December 31, 2018).
Per s. 74(1)(a)(v.2) the employer is prohibited from reprising against an employee because the employee discloses his/her rate of pay to another employee for the purpose of determining or assisting another person in determining whether an employer is complying with Part XII (Equal Pay for Equal Work).
Pursuant to s. 74.12(1)(a)(v.2), a client is prohibited from reprising against an assignment employee because the assignment employee discloses his/her rate of pay to an employee of the client for the purpose of determining or assisting another person in determining whether a temporary help agency complied with section 42.2 when it was in force.
Section 42.2, which provided equal pay for equal work on the basis of assignment employment status, was repealed effective January 1, 2019. Accordingly, the question might arise as to what reprisal protection exists in relation to this repealed provision.
Section 74.12(1)(a)(v.2) provides protection against reprisal where an assignment employee discloses his or her rate of pay to an employee of the client both during the timeframe that s. 42.2 was in effect (from April 1, 2018 to December 31, 2018) and after its repeal where the purpose of the disclosure is to determine, or to assist another person in determining, whether an employer was in compliance with section 42.2.
In other words, the specified disclosure is protected regardless of when it occurred, as long as it relates to a rate that was paid when s. 42.2 was in force (from April 1, 2018 to December 31, 2018).
This clause applies only to assignment employees. There is therefore no equivalent provision in s. 74(1). This provision prohibits a client from reprising against an assignment employee where the assignment employee discloses the rate paid to a client employee to his/her temporary help agency employer for the purposes of determining, or assisting another person in determining, whether a temporary help agency complied with section 42.2 when it was in force.
Section 42.2, which provided equal pay for equal work on the basis of assignment employment status, was repealed effective January 1, 2019. Accordingly, the question might arise as to what reprisal protection exists in relation to this repealed provision.
Section 74.12(1)(a)(v.3) provides protection against reprisal where an assignment employee discloses to his/her temporary help agency employer the rate paid to a client employee both during the timeframe that s. 42.2 was in effect (from April 1, 2018 to December 31, 2018) and after its repeal where the purpose of the disclosure is to determine, or to assist another person in determining, whether an employer was in compliance with section 42.2.
In other words, the specified disclosure is protected regardless of when it occurred, as long as it relates to a rate that was paid when s. 42.2 was in force (from April 1, 2018 to December 31, 2018).
Under s. 74.12(1)(b), a client of a temporary help agency is prohibited from reprising against an assignment employee not because of any activity engaged in by the employee but because the client or temporary help agency is or may be subject to a court order or garnishment that would require the client or agency to pay monies owed to the assignment employee by either the client or agency, to a third party. This prohibited ground is virtually identical to s. 74(1)(b) except that ESA Part XVIII, s. 74 refers to an employer who is required to pay a third party an amount owing by the employer to the employee.
Specifically, the prohibition in s. 74.12(1)(b) is distinguished from the prohibition in s. 74(1)(b) by the fact that the prohibition is against the client (rather than the employer) reprising against an assignment employee because either the employer (i.e. the temporary help agency) OR the client is required by a court order or garnishment to pay an amount that either the temporary help agency or the client owes to the assignment employee.
For a detailed discussion of the prohibited grounds under ESA Part XVIII, s. 74, see the discussion of step three of the four-step test. That discussion is relevant, with necessary modifications, in applying s. 74.12(1)(a) and (b).
Did the client or person acting on behalf of the client intimidate an assignment employee, refuse to have an assignment employee perform work for the client, terminate the assignment of an assignment employee, or otherwise penalize an assignment employee or threaten to do so because he or she engaged in the protected activities reference in step 3?
Sections 74.12(1)(a) and 74.12(1)(b) prohibit clients of temporary help agencies and persons acting on behalf of them from intimidating an assignment employee, refusing to have an assignment employee perform work for the client, terminating the assignment of an assignment employee, or otherwise penalizing an assignment employee or threatening to do so because the assignment employee engaged in the activities listed in s. 74.12(1)(a) or because monies owing to the assignment employee by the client or the temporary help agency were subject to garnishment or court order as per s. 74.12(1)(b). A contravention is established even if the client was motivated only in part to intimidate an assignment employee, refuse to have the assignment employee perform work for the client etc. because the assignment employee engaged in or more of the protected activities listed in s. 74.12(1)(a) or s. 74.12(1)(b).
The use of the word "because" necessitates a consideration of the client's motivation in taking the action it has taken. For a detailed discussion regarding motivation in establishing a contravention of ESA Part XVIII, s. 74, see the discussion of step four of the four-step test. That discussion is relevant, with necessary modifications, in applying s. 74.12(1)(a) and (b).
Section 74.12(2) places the burden of proof upon a client to show that the client did not contravene the anti-reprisal provisions in s. 74.12(1).
This provision is virtually identical to s. 74(2), which places the burden of proof upon an employer to show that the employer did not contravene the anti-reprisal provisions in s. 74(1).
Note however that ESA Part XXIII, s. 122(4) provides that where there is a review of a notice of contravention, the onus is on the Director of Employment Standards to prove, on a balance of probabilities, that the person against whom the notice of contravention was issued contravened the provisions of the ESA 2000 indicated in the notice. For a detailed discussion of this onus, see ESA Part XVIII, s. 74(2).
Section 74.13 provides that where section 102 is applied with respect to Part XVIII.1 of the Act, certain modifications to that section apply. Please see ESA Part XXII, s. 102 for a detailed discussion of s. 102.
Section 74.13(1) was amended by the Open for Business Act, 2010, SO 2010, c 16, effective November 29, 2010 to set out additional circumstances in which employment standards officers are permitted to require s. 102 meetings in the context of Part XVIII.1 and to reflect the addition of a new subsection (10) to s. 102. Under that section, if one party fails to attend a s. 102 meeting, an officer may make a decision on the basis of:
Paragraph 1 of s. 74.13(1) gives an employment standards officer the authority to require certain persons to attend a s. 102 meeting where:
Pursuant to paragraph 2 of s. 74.13(1), an officer may require any of the following persons to attend a s. 102 meeting:
Paragraph 3 of s. 74.13(1) provides that the references to an employer in paragraph 1 of s. 102(10) will be read as references to a client of a temporary help agency. As a result, if a client who was served with a notice to attend a s. 102 meeting or to bring records or other documents to the meeting fails to comply with that notice, the officer may make a determination without entertaining any further evidence or submissions from the client.
Similarly, paragraph 4 of s. 74.13(1) provides that references to an employee in paragraph 2 of s. 102(10) will be read as references to a temporary help agency assignment employee or prospective assignment employee. As a result, if an assignment employee or prospective assignment employee who was served with a notice to attend as. 102 meeting or to bring records or other documents to the meeting fails to comply with that notice, the officer may make a determination without entertaining any further evidence or submissions from the assignment employee or prospective assignment employee.
Note that an employment standards officer is not required to hold meetings under section 102; other methods of investigation or inspection may be used.
Subsection 74.13 (2) provides that if a client of a temporary help agency is a corporation, the reference in paragraph 3 of s. 74.13(1) will include a director or employee of the corporation who was served with a notice to attend a s. 102 meeting or bring or make available records or other documents to such a meeting.
As a result, if an employee or director of a corporate client was served with a notice to attend a s. 102 meeting or to bring records or other documents to such a meeting and fails to comply with that notice, the officer may make a determination without entertaining any further evidence or submissions from the client.
This section was added to specify modifications required for the application of s. 102.1 (added by the Open for Business Act, 2010 effective November 29, 2010) to temporary help agencies, their assignment employees and agency clients. Section 102.1 allows an employment standards officer to give notice that a party must provide evidence or submissions within a specified time period. Under that section, if one party fails to comply with the notice to provide evidence or submissions, an officer may make a decision on the basis of:
Paragraph 1 of s. 74.13.1(1) sets out circumstances (in addition to those listed in s. 102.1) in which an employment standards officer may give notice to certain persons to provide evidence or submissions, as follows:
Paragraphs 2 and 3 of s. 74.13.1(1) provide that where a temporary help agency client or assignment employee fails to comply with a s. 102.1 notice, the references to an employer or an employee in s. 102.1 are to be read as references to, respectively, a client and an assignment employee.
As a result, if a client who was served with a notice to provide evidence or submissions within a specified time period fails to comply with that notice, the officer may make a determination without entertaining any further evidence or submissions from the client.
Similarly, if an assignment employee who was served with a notice to provide evidence or submissions within a specified time period fails to comply with that notice, the officer may make a determination without entertaining any further evidence or submissions from the assignment employee.
Section 74.13.1(2) is a new subsection added by the Open for Business Act, 2010, effective November 29, 2010.
This subsection provides that if a temporary help agency's client, as referred to in paragraph 2 of s. 74.13.1(1) is a corporation, the term "client" includes a director or employee of the corporation who was served with a notice under subsection (1).
As a result, if an employee or director of a corporate client was served with a notice to provide evidence or submissions pursuant to s. 102.1 and fails to comply with that notice, the officer may make a determination without entertaining any further evidence or submissions from the client.
Section 74.14 applies where it is found that temporary help agency has charged a fee to an assignment employee or a prospective assignment employee in contravention of ESA Part XVIII.1, s. 74.8, paragraphs 1, 2, 3, 5 or 9.
Section 74.14(1)(a) states that where the officer finds a prohibited fee has been charged, the officer may arrange with the temporary help agency that it repay the amount of the fee to the assignment employee or prospective assignment employee directly, without an order being issued.
Section 74.14(1)(a.1) states that where an officer finds a prohibited fee has been charged, the officer may issue an order requiring the temporary help agency to repay the amount of the fee directly to the assignment employee or prospective assignment employee. Note that an order to repay fees issued under clause (a.1) does not include administrative costs. See s. 74.14(2) below.
Section 74.14(1)(b) states that where the officer finds that a prohibited fee has been charged, the officer may issue an order to the agency requiring the amount of the fee be paid to the Director of Employment Standards in trust. Note that an order to pay fees issued under clause (b) will include administrative costs. See subsection 74.14(2) below.
Assignment employees and prospective assignment employees seeking to recover fees are subject to the two-year limitation period for filing a complaint established under ESA Part XXII, s. 96(3). Subsection 96(3) provides that a complaint filed more than two years after the contravention has occurred will be deemed not to have been filed - see ESA Part XXII, s. 96. Note that an order issued under s. 74.14(1)(a.1) or s. 74.14(1)(b) is not subject to the limitation on recovery of wages imposed by s. 111 since an order to recover fees does not relate to wages. Finally, it should be noted that in addition to issuing an order to recover fees under either paragraphs (a.1) or (b) of s. 74.14(1), an officer could also issue a compliance order under ESA Part XXII, s. 108 and a notice of contravention under ESA Part XXII, s. 113 where there was a violation of s. 74.8(1) paragraphs 1, 2, 3, 5 or 9 as they may be issued in respect of any violation of the Act. See ESA Part XXII for a discussion of compliance orders and notices of contravention.
Section 74.14(2) provides that the order issued under s. 74.14(1)(b) shall, in addition to the amount of the fees owing, also contain an amount for administrative costs equal to 10 per cent of the amount owing or $100, whichever is greater. Note that there is no provision for the payment of administrative costs on an order issued under s. 74.14(a.1).
Both the fees and the administrative costs must be paid to the Director in trust. For example, if the amount of the fees to be repaid is $600, the administrative costs added to the order would be $100. If the amount of the fees owing is $2,000, the administrative costs added to the order would be $200.
There is no cap on the amount of administrative cost that may be imposed.
Administrative costs are not intended to be a penalty and the Program does not use them as such.
Subsection 74.14(3) provides that an order whether issued under s. 74.14(1)(a.1) or s. 74.14(1)(b) must state the paragraph of ESA Part XVIII.1, s. 74.8(1) that led to the order and the amount to be paid by the agency. Only a contravention of, s. 74.8(1) paras 1, 2, 3, 5 or 9 may lead to an order under this section.
The fact that a temporary help agency against whom an order has been issued had previous knowledge of the paragraph of s. 74.8(1) that was contravened and/or the amount owing does not relieve the officer of the requirement to set out this information in the order to recover fees.
Subsection 74.14(4) establishes that ESA Part XXII, ss. 103(3) and (6) to (9) apply, with necessary modifications, to orders to recover fees. In the context of an order to recover fees, any reference to an employee within those subsections of s. 103 is also a reference to an assignment employee or a prospective assignment employee as follows:
Section 74.14(5) indicates that ESA Part XXII, s. 105 applies, with necessary modifications, to the repayment of fees to an assignment employee or a prospective assignment employee. Two of the modifications that apply are set out in paragraphs 1 and 2 above.
Section 105 states:
Therefore, where an employment standards officer has arranged with a temporary help agency or ordered a temporary help agency to repay monies (fees) owing directly to an assignment employee or a prospective assignment employee under s. 74.14(1)(a) (when no order has been issued) or 74.14(1)(a.1) (when an order is issued) but the agency is unable to find the assignment employee or prospective assignment employee after having made a reasonable effort to do so, the agency must pay the amount of the fees owing to the Director of Employment Standards in trust. A trust is imposed upon the Director in the name of the Ministry to preserve the assignment employee or prospective assignment employee's right to the funds collected.
Where there has been a payment into trust with respect to money owed to an assignment employee or a prospective assignment employee and the individual cannot be located, the funds vest in the crown. These funds effectively become part of the government's general revenues.
The language of the s. 105(3) is permissive; that is the Director is given the discretion to pay out the funds collected, without interest, to another person the Director thinks is entitled to it instead of the assignment employee or prospective assignment employee, or to the assignment employee or prospective assignment employee themselves if they are subsequently located. The Director may do this; there is no requirement in the section that the Director do so.
Section 74.15 provides that where a temporary help agency charges a fee to a client in contravention of paragraph 8 or 9 of s. 74.8(1), the client may commence a civil action in a court of competent jurisdiction to recover the amount of the fee paid.
A client is not precluded from filing a claim under the Employment Standards Act, 2000 for an alleged violation of this section since s. 96 establishes that any "person" may file a claim. However, an employment standards officer cannot order that the prohibited fees be repaid; the only remedy available when an officer finds a client was charged a fee in contravention of paragraph 8 or 9 of s. 74.8(1) is the issuance of a notice of contravention or a compliance order against the agency. While a notice of contravention carries a fine, neither a notice of contravention nor a compliance order can require the repayment of fees charged in contravention of paragraph 8 or 9.
Section 74.16 enables an employment standards officer to issue an order to compensate an assignment employee or prospective assignment employee for damages that result when a temporary help agency contravenes ESA Part XVIII.1, paragraphs 4, 6, 7, or 10. Those paragraphs state that a temporary help agency is prohibited from doing any of the following:
Assignment employees or prospective assignment employees seeking a s. 74.16 order for compensation are subject to the two-year limitation period for filing a complaint established under ESA Part XXII, s. 96(3), which provides that a complaint filed more than two years after the contravention has occurred will be deemed not to have been filed.
As is the case with compensation orders issued under s. 74.17 and ESA Part XXII, s. 104, damages awards made under s. 74.16 are not subject to the limitation on the recovery of wages imposed by ESA Part XXII, s. 111, which limits the recovery of wages to those wages that come due within two years preceding date the claim is filed. Because the compensation awarded in s. 74.16 orders does not come due until the officer issues the order, ESA Part XXII, s. 111 does not restrict recovery of such compensation.
A compensation order may include a number of types of damages. The order is not simply expressed as a lump-sum amount, but rather reflects a precise and detailed breakdown of the monetary amounts assessed under each head of damages. For a discussion of the heads of damages associated with a compensation order issued under s. 104, see ESA Part XVIII, s. 74(1).
While that discussion relates primarily to reprisals under ESA Part XVIII, s. 74, some modified version of the damages awarded under that section may also apply to a compensation order issued under s. 74.16. For example, when there is a violation of paragraph 4 or 7 that resulted in an assignment employee not obtaining employment with a client of the agency, the following heads of damage may apply:
Although similar heads of damages are considered in the context of reprisals, the damages suffered by an assignment employee as a result of a contravention of paragraphs 4, 6, 7 or 10 of s. 74.8 reflect the unique nature of the relationship between the assignment employee and their temporary help agency employer and clients of the agency. For example, under the first heading, the intention is to quantify any wage losses suffered over the time it may take or should reasonably have taken the assignment employee to obtain direct employment with another employer – that is, employment other than as a temporary help agency assignment employee. Although there may be a lengthy period in which the employee is unable to find other direct employment, they may in large measure be able to mitigate their losses because they continue to work for the agency as an assignment employee. It is in fact possible that the employee would suffer no actual damages in the time it takes to find direct employment with another employer if at all.
That said, even if alternate direct employment was subsequently found, the new position may be inferior to the one the employee would have had with the client and in that case, some compensation may be appropriate for the lost opportunity for direct employment with the client, as indicated in the second head of damages noted above. For example, compensation may be awarded under this heading if the alternate position does not have the same opportunities for advancement, does not have the same perks as the position with the agency's client and/or did not give the employee the same advantages that might result because of past work experience with that client through previous assignments.
An award might also be made under this second heading if no alternate direct employment was obtained at all. In that case, the award would attempt to compensate the employee for such things as lost promotional opportunities, regular hours, etc., associated with the lost opportunity for direct employment with the client.
Awards made under headings (3) to (6) above are subject to the same considerations as discussed in awards made under ESA Part XXII, s. 104 for contraventions of s. 74(1). See the discussion in ESA Part XVIII, s. 74(1).
Again, it should be noted that it is also possible that a contravention of paragraphs 4, 6 and 7 would not necessarily result in damages to an assignment employee or prospective assignment employee. For example, an agency may have a term in a contract with an assignment employee that is contrary to paragraph 4 of s. 74.8(1). The assignment employee may file a claim but if there is no evidence before the officer that the restriction in the contract actually prevented the assignment employee from obtaining employment with a client there may be no actual damages flowing from the contravention.
Where an agency has contravened paragraph 6 of s. 74.8(1) by imposing a restriction on a client's ability to provide a job reference, it is possible that the damages flowing from that contravention could be minimal because the lack of such a reference may not have prevented the assignment employee from (for example) obtaining other employment.
As another example, an agency may have included a provision in a contract between a client and a temporary help agency that was contrary to paragraph 7 of s. 74.8(1) but the client may not have intended to directly employ the assignment employee who filed the complaint under s. 74.8. Again, in those circumstances, no damages would flow from the breach of paragraph 7 as far as the assignment employee was personally concerned.
However, in the situations described above, the agency would be subject to other enforcement action for the breach of paragraphs 4, 6 or 7 of s. 74.8, such as a notice of contravention, a compliance order and the term itself would be deemed to be void pursuant to paragraph 9.
Finally, also note that as in any case where a compensation order may be made, an assignment employee or prospective assignment employee has a duty to mitigate their damages - see ESA Part XVIII, s. 74(1) for a discussion.
Where an order is issued for compensation under s. 74.16(1), s. 74.16(2) provides that the order must also require the agency to pay the amount of compensation to either the Director in trust pursuant to s. 76.16(2)(a) or to the assignment employee or prospective assignment employee pursuant to s. 76.16(2)(b). If the terms of the order require the temporary help agency to pay the amount of the compensation to the Director in trust, the agency will also be required to pay an amount for administration costs equal to the greater of 10 percent of the compensation or $100. Note that the required terms in s. 74.16(2)(b) do not include administrative costs.
Subsection 74.16(3) provides that an order must set out the paragraph of ESA Part XVIII.1, s. 74.8(1) that led to the order and the order must also state the amount to be paid by the agency. Only a contravention of s. 74.8(1) paragraphs 4, 6, 7 or 10 may lead to an order under that section.
The fact that the temporary help agency against whom an order is issued had previous knowledge of the paragraph of s. 74.8(1) that was contravened, and/or of the amount owing, does not relieve the officer of the requirement to set out this information as part of the order.
Subsection 74.16(4) provides that ESA Part XXII, ss. 103(3), (6) to (9) apply, with necessary modifications, to orders for compensation issued against temporary help agencies under s. 74.16. When read in the context of a compensation order issued under s. 74.16, any reference to an employee within those subsections of ESA Part XXII, s. 103 is deemed to be a reference to an assignment employee or a prospective assignment employee as follows:
Section 74.17 applies where an employment standards officer finds that a client of a temporary help agency has contravened ESA Part XVIII.1, s. 74.12 with respect to an assignment employee. In that situation, the officer may order that the assignment employee be compensated for any loss incurred due to the contravention, be reinstated in the assignment, or be both compensated and reinstated.
Assignment employees seeking compensation/reinstatement under this section are subject to the two-year limitation period for filing a complaint established under ESA Part XXII, s. 96(3), which provides that a complaint filed more than two years after the contravention has occurred will be deemed not to have been filed. Damages awards made under s. 74.17 are not subject to the limitation on recovery of wages imposed by ESA Part XXII, s. 111, which limits the recovery of wages to those wages that come due within two years preceding the date the claim is filed. Because the compensation awarded in s. 74.17 orders does not come due until the officer issues the order, s. 111 does not restrict recovery of that compensation.
An order issued under this section may include a number of types of damages. The order is not expressed simply as a lump-sum amount, but rather reflects a precise and detailed breakdown of the monetary amounts assessed under each head of damages. For a discussion of compensation in the context of reprisal by an employer, see ESA Part XVIII, s. 74(1).
In cases where there is a reprisal by a client, the damages awards as discussed in ESA Part XVIII, s. 74(1) may not be relevant in all aspects. Primarily, the differences will be related to the fact that a client has no direct employment relationship with an assignment employee. Reprisals may therefore take the form of a client prematurely ending the assignment. For example, assume an assignment employee had a two-month term assignment with client A. Within just a few days of the commencement of that assignment and in response to inquiries from the assignment employee about their rights to a meal break under the ESA 2000, client A ended the assignment. An employment standards officer may, in that case, conclude that client A contravened s. 74.12. However, in assessing the damages (assuming that reinstatement into the assignment was not an option), the officer may consider the following:
Any damages assessment is subject to consideration of the assignment employee's duty to mitigate their losses. For example, if the assignment employee refused the agency's offers of reasonable alternate assignments after the assignment with client A was ended, the damages award and particularly any amounts under 1) above would be significantly reduced.
The question may arise as to when an order for reinstatement in the assignment is appropriate – see the discussion at ESA Part XVIII, s. 74(1). In the context of orders issued under s. 74.17, it is important to note that any reinstatement order is limited to the terms of the original assignment with the client, assuming those terms are in compliance with the ESA 2000.
Because such a reinstatement order necessarily involves the agency as the employer of the assignment employee and a party to the contract with the client, the Act stipulates that the agency has an obligation under s. 74.17(4) to do whatever it can do to enable compliance by the client. For more information on this point see the discussion below at s. 74.17(4).
One question that arises concerns the ability of an officer to order a client to place as opposed to reinstate an assignment employee into an assignment. For example, assume a client is looking for an assignment employee to fill a 12-month assignment. The agency sends a resume to the client who then asks to schedule an interview with the assignment employee. At the interview, the client notes the assignment employee is pregnant and suggests that she would have been perfect for the position but because of a conflict between the timing of the assignment and her impending pregnancy/parental leave she will not be given the assignment. The client's actions in this case would clearly constitute a reprisal under s. 74.12; however, the remedy under s. 74.17(1) would be limited to a compensation order as that section does not provide for an order requiring a client to place an assignment employee into an assignment.
Where an order is issued for compensation under s. 74.17(1), s. 74.17(2) provides that the order must also require the client to pay the amount of the compensation to either the Director in trust pursuant to s. 74.17(2)(a) or to the assignment employee pursuant to s. 74.17(2)(b). If the terms of the order require the client to pay the amount of the compensation to the Director in trust, the client will also be required to pay an amount for administration costs equal to the greater of 10 percent of the compensation or $100. Note that the required terms in s. 74.17(2)(b) do not include administrative costs.
Subsection 74.17(3) provides that ESA Part XXII, ss. 103(3), (5) to (9) apply, with necessary modifications, to orders issued under s. 74.17 for client reprisal. In the context of an order for client reprisal, any reference to an employer within those subsections in s. 103 is deemed to be a reference to a client and any reference to an employee is deemed to be a reference to an assignment employee as follows:
This provision applies where an employment standards officer has issued an order under s. 74.17 requiring a client of a temporary help agency to reinstate an assignment employee into a particular assignment. Section 74.17(4) places an obligation on the temporary help agency to do whatever it can reasonably do to enable the client's compliance with the order.
For example, a temporary help agency has an ongoing contract with a client for the provision of clerical services. The temporary help agency places an assignment employee with the client to provide filing services. The assignment employee will soon be taking a pregnancy leave. If the client subsequently reprises against the assignment employee by refusing to have her continue to perform the work assignment because she plans to take a pregnancy leave, an employment standards officer could order that the client reinstate that assignment employee into the filing assignment. The temporary help agency must then do whatever it can reasonably do in order to enable the client to comply with the order. Depending on the circumstances this may include, for instance, liaising with the client to ensure the assignment employee is reinstated into the assignment, re-opening the contract with the client for the assignment, or taking other reasonable steps to ensure the assignment employee can return to performing work for the client.
The Stronger Workplaces for a Stronger Economy Act, 2014, SO 2014, c 10 added this provision to the Employment Standards Act, 2000. This section imposes joint and several liability on temporary help agencies and the clients of temporary help agencies for certain unpaid wages of the agency's assignment employees, as described in s. 74.18(3), owed in respect of any pay period. This provision came into force on November 20, 2015 together with the provisions in ESA Part XVIII.1, s. 74.4.1 and s. 74.4.2 that impose new record keeping obligations on both agencies and their clients to record the hours worked by each assignment employee of the agency in each day and week for the client.
As this joint and several liability for certain wages applies as of November 20, 2015, Program policy is that clients may be liable only for such wages as are earned on or after that date. Therefore, a client would not be liable for any wages that were earned in a pay period that ended prior to November 20, 2015 nor for any of the wages earned prior to November 20, 2015 in a pay period that began prior to that date but that ended on or after November 20, 2015.
Practically then, if a pay period begins prior to November 20, 2015 but ends on or after November 20, 2015, s. 74.18 would be applied as if the pay period began November 20, 2015.
Note that this joint and several liability imposed on the client is proportional if an assignment employee has performed work for more than one client in the pay period in respect of which the wages are unpaid. See the discussion of ss. 74.18(2) and (3) further below in this section.
This provision states that the joint and several liability imposed on clients of agencies for certain unpaid wages of the agency's assignment employees as described in s. 74.18(3) is a proportional liability if the assignment employee has performed work for more than one client of the agency in the specific pay period for which the wages are owed.
Therefore, while the agency is liable for the full amount of any unpaid wages, each client is liable only for the unpaid wages as described in s. 74.18(3) earned in any given pay period in an amount that is proportional to the hours worked for the client in the pay period, relative to the total hours worked.
For example, assume an assignment employee was owed $2000 in unpaid wages as described in s. 74.18(3) for a single pay period. The employee had worked the following hours in the pay period:
The proportionate liability of each client is based on the number of hours worked for each client relative to the total hours worked in the pay period:
The agency is liable for the full $2000.
Also see the discussion of s.74.18(3) below, which sets out the types of wages that clients are liable for and provides examples in which different types of wages are unpaid in respect of the same pay period.
As noted in the discussion of s. 74.18(1) above, Program policy is that a client of a temporary help agency will not be liable for any wages earned in a pay period that ends before November 20, 2015 or in any portion of a pay period preceding November 20, 2015.
For example, assume an assignment employee was owed $2000 in unpaid wages as described in s. 74.18(3) for a single pay period, but the pay period in question began on November 16, 2015 and ended November 29, 2015. Only those wages earned and only those hours worked for clients on or after November 20, 2015 would be included in the calculation of each client's proportional liability.
In this case, assume the employee worked a total of 80 hours and 40 of those hours were worked between November 20, 2015 and November 29, 2015 (inclusive).
The first step in determining the liability of the clients would be to determine what portion of the wages as described under s. 74.18(3) were earned in respect of the 40 hours worked between November 20, 2015 and November 29, 2015 (inclusive). Assume that of the $2000 owed in respect of the pay period beginning November 16, 2015 and ending November 29, 2015 that $1000 was earned on or after November 20, 2015.
Secondly, the proportionate liability would be determined with respect to only those clients for whom the employee performed work between November 20, 2015 and November 29, 2015 (inclusive) based on the proportion of hours worked for each such client between November 20, 2015 and November 29, 2015.
Total hours worked: 80
Hours worked November 20 to 29, 2015 inclusive: 40
Hours worked prior to November 20, 2015:
Hours worked November 20 – 29, 2015:
The proportionate liability of each client is based on the number of hours worked for each client relative to the total hours worked in that portion of the pay period beginning November 20, 2015 and ending November 29, 2015:
The agency is liable for the full $2000. However, in assessing the clients' joint and several liability, the employment standards officer would look only at those hours worked and wages earned between November 20, 2015 and November 29, 2015 (inclusive) as set out in the example above.
Subsection 74.18(3) describes those wages of a temporary help agency's assignment employees for which the clients of the agency may be jointly and severally liable. The wages are limited to regular wages, overtime pay, public holiday pay and premium pay.
Regular wages are defined in ESA Part I, s. 1. The definition specifically excludes overtime pay, public holiday pay, premium pay for work performed on a public holiday, vacation pay, domestic or sexual violence leave pay, termination pay, severance pay and termination of assignment pay, and any greater right or benefit to which the employee is entitled pursuant to ESA Part III, s. 5(2) in respect of such wages. Regular wages would, however, include wages for work performed such as the employee's hourly rate or salary, piece rate, shift premiums and commissions.
In addition to regular wages, clients are jointly and severally liable under this subsection for overtime pay, public holiday pay and premium pay. The liability for these specific wages, i.e., overtime pay, public holiday pay and premium pay (for work performed on a public holiday), will therefore extend to any greater right or benefit to which the employee is entitled pursuant to ESA Part III, s. 5(2) in respect of overtime pay, public holiday pay and premium pay.
In accordance with this subsection, clients have no liability for vacation pay, termination pay or severance pay.
Calculating each client's liability for the unpaid wages is determined in accordance with the method described in s. 74.18(2). Effectively, a client is proportionately liable for a share of the total wages as described in s. 74.18(3) that are unpaid in respect of any particular pay period, if the assignment employee has performed work for more than one client of the agency in the specific pay period for which such wages are owed.
Specifically, amounts owing in respect of any or all the wages described in s. 74.18(3) are added together. Each client's proportionate liability is then calculated by multiplying that amount by the ratio of the number of hours worked for the client in the pay period divided by the total hours worked for all clients in that pay period.
An employee has a two-week pay period and total wages owed for that pay period as follows:
The employee is owed a total of $300 and the agency is liable for that full amount.
Client A is liable for a proportionate amount of the total wages described in subsection 3 that are owing for the pay period = $300 (that is, both the overtime pay and premium pay owing in respect of the pay period). The proportionate liability is based on the relative number hours the assignment employee worked for Client A as compared to the total hours worked in the pay period as follows:
Client B is liable for a proportionate amount for the pay period as follows:
An employee is terminated at the end of a two-week pay period and is owed wages in respect of that last pay period as follows:
The employee is owed a total of $2200 and the agency is liable for that full amount. However, in accordance with s. 74.18(3), the clients of the agency have no liability with respect to the $200 in outstanding vacation pay or the $500 termination pay in lieu of notice owing to this employee.
Client A is liable for a proportionate amount of the total wages described in s. 74.18(3) that are owing for the pay period = $1500 (that is, the overtime pay, premium public holiday pay and regular wages only owing in respect of the pay period). The proportionate liability is based on the relative number hours the assignment employee worked for Client A as compared to the total hours worked in the pay period as follows:
Client B is liable for a proportionate amount for the pay period as follows:
Section 74.18(4) provides that a temporary help agency, as the employer of an assignment employee, is primarily responsible for the employee's wages, but the proceedings against the employer do not have to run their full course before proceedings may be commenced against a client of the agency.
See also the discussion in ESA Part XX, s. 81(2), a similar provision that applies in the context of a corporate director's liabilities for the wages of an employee of a corporate employer.
This provision allows certain enforcement provisions of the ESA 2000 that apply with respect to employers to be used in relation to clients of temporary help agencies for the purposes of enforcing client liability for the wages of the agency's assignment employees, just as if the client was the employer of the assignment employee, including provisions in:
In other words, any provision that would apply with respect to the employer (in relation to the enforcement of entitlements to unpaid wages) may be read to refer to a client of a temporary help agency if a liability for unpaid wages has been found in accordance with s. 74.18. For example, an employment standards officer may require the client to attend a meeting under ESA Part XXII, s. 102 or issue an order under ESA Part XXII, s. 103 or s. 106.
This provision specifies that whereas the client of a temporary help agency is deemed to be the employer of an assignment employee for the purposes of enforcing the joint and several liability of a client under s. 74.18, specifically, the order issued by an employment standards officer under ESA Part XXII, s. 103 against the client is treated as if it were an order against the employer.
This means for example that a client could appeal such an order to the Ontario Labour Relations Board. It also means that the directors of a client that was a corporation are subject to the director liability provisions in ESA Part XX as if they were directors of an employer.
The intent of the building services provisions contained in Part XIX (Building Services Providers) is two-fold. First, the provisions impose obligations for the payment of termination pay, severance pay and vacation pay (in respect of employees of the replaced provider) when there is a change in the provider of building services. Second, the provisions aim to ensure that the persons bidding on a contract in the building services sector have all the necessary information about the employees' wage rates, etc., in order to estimate their potential termination and severance obligations when preparing their bids and to make offers to employees of the replaced provider if they should win the contract.
Section 75(1) is similar to s. 13.1(2) of the former Employment Standards Act. Section 75(1) states that this Part applies if a building services provider provides building services at a building, stops providing those services and is replaced by a new provider. A building services provider may be replaced in the following situations:
In addition, the two providers (e.g., the replaced provider and the new provider) must be providing the same general category of building services at the premises. If, for example, a building owner discontinued its food service contract with A and contemporaneously entered into a security services contract with B, B could not be said to be "replacing" A at the premises.
This provision is substantially the same as s. 13.1(4) under the former Employment Standards Act. Section 75(2) provides that if the new provider does not employ an employee of the previous provider who was engaged in providing services at the premises, the new provider shall comply with Part XV of the Employment Standards Act, 2000 (Termination and Severance of Employment) with regards to the employee as if the new provider had terminated and severed the employee’s employment. An employee of the replaced provider who was not engaged in providing services at the premises would not be entitled to notice and or severance pay from the new provider if the new provider did not employ him or her. Those obligations would continue to lie with the replaced provider.
Note that the requirement that the employee be engaged in providing services at the premises is not mirrored in s. 10 of the Act. Consequently, continuity of employment will be afforded to employees of the replaced provider who are employed by a new provider, whether they were engaged in providing services at the premises or not.
The obligations imposed under this section are subject to s. 75(4) which states that the new provider is not required to comply with subsection (2) with respect to an employee retained by the replaced provider or any prescribed employees.
There is often a gap between the time a contract is awarded to a new provider and the date the new provider actually begins providing the services. The obligations to comply with Part XV (Termination and Severance of Employment) are imposed on the new provider and cannot be discharged until the changeover date. For a discussion of the definition "Changeover date" see O Reg 287, s. 2(5). It is the Program’s position that it is inherent in the notion of compliance with Part XV that the employees cannot be provided with notice by a new provider if they are still in the employ of the replace provider. Therefore, if a successful bidder purported to give notice to the current provider’s employees prior to the changeover date, such notice would be invalid.
One question that arises is when can it be said that the new provider has not employed the employees of the replaced provider, thereby triggering the obligations to comply with Part XV? Section 75(2) provides that a new provider will be required to comply with Part XV of the Act if he or she does not hire the employees of the replaced provider. It is Program policy that although there may be continuity of employment for employees of the replaced provider terminated before the changeover date in accordance with s. 10 of the Act (which provides for continuity of employment if the employees are hired by the new provider within the earlier of 13 weeks after the last day of employment with the replaced provider or the changeover date), the new provider’s obligations with respect to notice of termination and severance pay under s. 75(2) apply only to persons who were employees of the replaced provider as of the changeover date and who were not hired within 13 weeks of the changeover date. The new provider would have no liability for Part XV obligations under this section with respect to employees of the replaced provider terminated by the replaced provider either before the changeover date or more than 13 weeks after the changeover date.
However, the obligations to comply with Part XV are also subject to s. 75(4), which provides that no termination and severance obligations will be imposed on the new provider with respect to any "prescribed" employees (i.e., prescribed under s. 2(1) of O Reg 287/01) or if the employee continues to be employed by the replaced provider. See ESA Part IV for a more detailed discussion of s. 10 of the Act and further below in this section for a more detailed discussion of s. 75(4) of the Act.
The commencement of a lay-off does not trigger the end of an employment relationship. If an employee is on temporary lay-off for the purposes of notice of termination or a lay-off for the purposes of severance pay or both, he or she is considered to be employed. Note that even though an employee may have ceased to be on temporary lay-off after 13 weeks for the purposes of the notice of termination provisions in the Act, if he or she remains on lay-off for severance purposes for a further 22 weeks, the employee will continue to be employed for that additional 22 weeks.
It should also be noted that the deemed termination date as set out in s. 56(5), which provides that where an employee is temporarily laid off and the lay-off subsequently ceases to be temporary that his or her employment is deemed to be terminated on the first day of the lay-off, has no application with respect to assigning the liability for termination pay (which is determined under this Part), although it will be relevant in determining the quantum (which is determined under Part XV).
Section 75(3) states that the new provider is deemed to be the employer of all employees of the previous provider whom it chooses not to employ, for purposes of Part XV (Termination and Severance of Employment). As a result, the entitlements to notice or termination pay and/or severance pay for those employees are based on the employees' service with the replaced provider. Even though the new provider did not enter into an employment relationship with the employee, the employee’s period of service with the previous provider will be used to calculate his or her entitlement to termination and severance pay. Note, however, that as the building service provisions under the former Act (continued in Part XIX of the ESA 2000) were retrospective to June 4, 1992, only, this section can only be used to credit an employee for his or her employment with a replaced provides prior to June 4, 1992, if the replaced provider was providing service at the premises on that date.
This provision is similar in effect to s. 13.1(4) and s. 1 of O Reg 138/96 of the former Employment Standards Act. Section 75(4) confirms that the new provider is exempted from the obligations in s. 75(2) (i.e., termination and severance obligations) with respect to employees retained by the previous provider or those employees prescribed by regulation. Section 75(4) must therefore be read in conjunction with the list of "prescribed employees" in s. 2(1) of O Reg 287/01. Employees retained by the replaced provider - s. 75(4)(a)
Section 75(4)(a) relieves a new provider of the obligation to comply with Part XV with respect to employees of the replaced provider that it does not employ, if they continue to be employed by the replaced provider. As noted in the discussion of s. 75(2) of the Act, s. 75(4) refers, in effect, only to employees who continue to be employed by the replaced provider more than 13 weeks after the changeover date.
An employee will continue to be employed by a replaced provider if he or she is retained by the replaced provider (e.g., to work at another building site). The employee will also be considered to be employed by the replaced provider if he or she is on a lay-off for the purposes of notice of termination (see s. 56(3) and/or severance pay (s. 63(2)).
If an employee’s regular non-overtime pay with the replaced provider falls below the thresholds set out in s. 56(3) or s. 63(2), then the employee will be deemed to be on a lay-off and there will be a deemed termination or severance by the replaced provider after the lay-off has reached a certain point (i.e., 13 or 35 weeks in the case of termination pay, depending, for example, on whether benefits are continued [ss. 56(2) and 56(3)] and 35 weeks in the case of severance pay [s. 63(1)]). If the employee continues to be on lay-off for either both notice of termination or severance purposes 13 weeks after the changeover date, the employee will consider to have been retained by the replaced provider under s. 75(4) and the new provider will have no obligations under Part XV. In that case, liabilities for termination and/or severance will remain with the replaced provider.
Section 2(1) of O Reg 287/01 lists four additional classes of employees in respect of which the new provider is relieved of the obligation to comply with s. 75(2). For a detailed discussion of these employees, see O Reg 287/01, s. 2(1).
Some other questions that arise concerning the Part XIX (Building Services Providers) obligations of the new provider, under s. 75(2) are as follows:
This provision is substantially the same as s. 13.1(6) of the former Employment Standards Act. Section 76(1) states that when a provider of building services is replaced by a new provider and ceases to employ an employee, the replaced provider shall pay the employee the amount of any vacation pay accrued (even though it may not yet be due).
The obligation to pay any accrued vacation pay (whether due or not) at the time the replaced provider ceases to employ the employee would ordinarily be imposed under s. 11(5) of the Employment Standards Act, 2000. Therefore, section 76(1) is assumed to have relevance only where such employees are hired by the new provider, triggering the continuity of employment obligations under s. 10 of the Act. In that case (i.e., where the new provider hires employees of the replaced provider), s. 76(1) eliminates the possibility of any argument that the new provider might have liability for the accrued vacation pay entitlements of the replaced provider’s employees.
Normally, a replaced provider would have built the cost of its employees' vacation pay into the amount of its original bid, and that cost, along with other costs, would be reflected in the contract price; it would therefore be a windfall for the replaced provider if the new provider were required to pick up the liability for any of the vacation pay that accrued during the term of the replaced provider’s contract with the building owner or manager.
See additional discussion on the Program’s policy regarding continuity of employment and vacation pay liability in the building services context in ESA Part IV, s. 10(2).
This provision requires that the replaced provider pay accrued vacation pay to employees pursuant to s. 76(1) on or before the later of two dates:
This provision is different from the corresponding provision (s. 13.1(7)) of the former Employment Standards Act which required the previous provider to pay accrued vacation pay within seven days after the earlier of: (1) the day the employee ceased to be employed by the previous employer or (2) the day on which the previous employer ceased to provide services at the premises.
Section 76(2) is consistent with the provisions in the ESA 2000 regarding the payment of wages when employment ends (s. 11(5)). Section 11(5) states that the employee’s wages must be paid no later than the later of seven days after employment ends or the day that would have been the employee’s next pay day.
This section is substantially the same as s. 13.1(10) under the former Employment Standards Act.
This provision is designed to ensure that bidders on a building services contract have the information they require to determine the amount of their bid. In particular, this subsection enables the bidders to estimate the extent of their potential liability under Part XV (Termination and Severance of Employment) of the Employment Standards Act, 2000. The reference to "prescribed" information means prescribed by regulation. Sections 3(1), (3), (4) and (5) of O Reg 287/01 set out the information that must be provided by the owner or manager of the premises under s. 77(1). If an owner or manager of the premises fails to provide the required information, an employment standards officer could issue a compliance order under s. 108 and/or a notice of contravention under s. 113. There is no authority however for issuing a compensation order under s. 104 in favour of a person seeking to become a new building services provider where that person suffers damages as a result of a failure on the part of the owner or manager to provide information under s. 77(1).
The definition of "request date" as it is used in these provisions, is set out in s. 3(6) of the same regulation as follows:
For information regarding sections 3(1), (3), (4) and (5) of O Reg 287/01, see O Reg 287/01.
This section is substantially the same as s. 13.1(9) of the former Employment Standards Act.
Section 77(2) provides that a new provider is entitled to additional information as prescribed. The prescribed information is set out in s. 3(2) of O Reg 287/01 as follows:
The new provider of services is consequently entitled to request additional and updated information regarding employees of the previous provider who are performing work at the premises. All information, including the information listed in paragraphs 1 to 8 of s. 3(1) (see O Reg 287/01, s.3(1) of the Manual for further discussion) which may have been provided at the time the new provider was bidding on the contract, must be accurate as of the date of the subsequent request under s. 77(2).
Paragraph 2 of s. 3(2) of O Reg 287/01 also allows the new provider to request the names, addresses and telephone numbers of the employees engaged in providing services at the premises on the date the request for information is made.
During the period from the time the new provider is awarded the contract to the "changeover date" of the contract, when the new provider begins to provide services at the building premises, the employees' names, residential addresses and telephone numbers can be used to:
This subsection ensures that the new provider has access to the necessary information to determine the actual Part XV (Termination and Severance of Employment) entitlements for employees of the replaced provider. If an owner or manager of the premises fails to provide the required information, an employment standards officer could issue a compliance order under s. 108 and/or a notice of contravention under s. 113. There is no authority however for issuing a compensation order under s. 104 in favour of a new building services provider where the new provider suffers damages as a result of a failure on the part of the owner or manager to provide information under s. 77(2).
This provision is substantially similar to s. 13.1(8) of the former Employment Standards Act.
The effect of this subsection is to require the incumbent or replaced provider to share certain information with the owner or manager of a building in respect of employees providing services at the premises.
This section is aimed at facilitating the flow of information from the incumbent or replaced provider to those who are bidding on the contract or who have won the contract. This is necessary so that bidders know the extent of their potential liability under Part XV (Termination and Severance of Employment) when they make bids. In addition, it is also necessary so that new providers can determine the precise amount of their liability under Part XV (Termination and Severance of Employment) upon assuming a new building services contract.
The information that is required to be provided under s. 77(1) or (2) is prescribed in s. 3 of O Reg 287/01 and is described in detail in O Reg 287/01, s. 3. If a provider or former provider fails to provide the required information, an employment standards officer could issue a compliance order under s. 108 and/or a notice of contravention under s. 113. There is no authority however for issuing a compensation order under s. 104 in favour of a new building services provider where the new provider suffers damages as a result of a failure on the part of the incumbent provider to provide information under s. 77(3).
This provision is substantially the same as s. 13.1(11) of the former Employment Standards Act.
Section 78(1) states that a person who receives information under s. 77 shall use the information only for the purposes of complying with Part XIX (Building Services Providers). This means that a building services company cannot, for example, use the information received under s. 77 to assess the profitability of a business for purposes of buying it.
This provision is substantially the same as s. 13.1(12) of the former Employment Standards Act.
Section 78(2) states that a person receiving information under s. 77 shall not disclose it to anyone except as authorized this Part (i.e., by s. 77). This means that if, for example, a building owner or manager receives information from the incumbent provider about the wage rates paid to the employees, the building owner cannot disclose that information to any persons except as set out in s. 77. However, where the building owner or manager is a provincial or municipal government "institution" as defined under the Freedom of Information and Protection of Privacy Act, RSO 1990, c F.31 or the Municipal Freedom of Information and Protection of Privacy Act, RSO 1990, c M.56, the disclosure provisions of those Acts will prevail over the confidentiality provision in s. 78(2) in the event of a conflict.
The directors' liability provisions of the Employment Standards Act, 2000 essentially mirror those in the Ontario Business Corporations Act, R.S.O. 1990, c. B.16 ("OBCA"), but, unlike the OBCA's directors' liability provisions, may be enforced through administrative action under the Employment Standards Act, 2000, rather than protracted and expensive civil proceedings. The intention of Part XX (Liability of Directors) is to allow for more efficient enforcement of existing directors' liability, rather than to expand the scope of that liability.
This section defines "director" for purposes of Part XX (Liability of Directors).
A director of a corporation is elected by the corporation's shareholders and sits on its board of directors to oversee its business. (Note that when a business is initially incorporated, the directors - referred to as "first directors" - are not elected. Rather, they are named as directors and hold director positions until elections are held.)
Information returns that are required to be filed by the corporation with the Ontario Ministry of Government and Consumer Services (or, if it is federally incorporated, Corporations Canada) are publicly available and should contain the names and addresses of the current directors. If these are not up to date, then the Minute Book from the meetings of the Board of Directors should indicate who the current directors are.
With respect to companies incorporated under the Ontario Business Corporations Act, R.S.O. 1990, c. B.16 ("OBCA") or the Canada Business Corporations Act, R.S.C. 1985, c. C-44 ("CBCA"), if there is no registered director because all of the directors have resigned or have been removed by the shareholders without replacement, a person who manages or supervises the management of the business and affairs of the corporation is, subject to certain exceptions, deemed to be a director. See s. 115 of the OBCA and s. 109 of the CBCA.
The OBCA and CBCA provisions mentioned in the preceding paragraph would not apply in the case where a corporation's sole director dies. If subsequent to the director's death, the business of the corporation is managed or supervised by someone who does not become a director, it will be a question of fact as to whether that individual is acting as an agent of the corporation (in which case, subject to s. 137 of the Employment Standards Act, 2000, he or she would have no personal liability) or is instead acting as a sole proprietor to whom the corporation's business has been transferred (in which case there would be personal liability). If the individual is acting as an agent of the corporation, wages earned by employees, including wages earned after the individual began acting, would be owed by the corporation (though the estate of the deceased director would also be liable for those wages earned up until the director's death, subject to the limits in Part XX). If the individual is acting as a sole proprietor to whom the corporation's business was transferred, wages earned by employees up to the time of transfer would be owed by the corporation (again, with the estate of the deceased director also liable for those wages earned up until the director's death, subject to the limits in Part XX), while wages earned from the time of transfer onwards would be owed by the sole proprietor.
Section 79 also includes in the definition of "director," for purposes of Part XX, a shareholder who is a party to a unanimous shareholders agreement ("USA").
An USA is an agreement whereby the shareholders may validly restrict, in whole or in part, the powers of the directors to manage the business and affairs of the corporation.
Under the USA, the shareholders have the rights, powers and duties of directors to manage the business and affairs of the corporation to the extent set out in the agreement, and the directors are relieved of their duties and liabilities to the same extent. Thus the shareholders acting under a USA generally stand in the place of the directors. USAs are recognized by both the OBCA and the CBCA.
Typically, unanimous shareholder agreements are used in closely-held, private corporations where there are only a few shareholders. The shareholders that are parties to the USA could be either individuals or corporations. Where the shares are held in trust for an individual, that individual may be found to be a director if he or she controls how the trustee votes his or her shares. See Vaszi v. Ontario (Ministry of Labour), 2000 CanLII 12592 (ON LRB).
This and the other subsections in s. 80 deal with Step 1 (determining whether directors are excluded from the application of Part XX) in the four step process for applying Part XX.
Section 80(1) indicates that shareholders who are parties to a unanimous shareholders agreement are subject to Part XX only to the extent that the actual directors are relieved under the applicable corporations legislation of liability to pay wages to the corporation's employees.
Section 108(5) of the Ontario Business Corporations Act, R.S.O. 1990, c. B.16 ("OBCA") states:
Section 146(5) of the Canada Business Corporations Act, R.S.C. 1985, c. C-44 ("CBCA") states:
Accordingly, a unanimous shareholders agreement may have the effect of imposing liability on shareholders under Part XX of the Employment Standards Act, 2000 (and relieving the actual directors of their Part XX liabilities), but only to the extent that the actual directors of the corporation are relieved of their obligations for wages under the OBCA or CBCA.
Generally speaking, unanimous shareholders agreements come to the attention of an employment standards officer when he or she notifies a director of potential liability under the Act; a director who alleges that his or her liabilities for wages are relieved by such an agreement will be asked to provide a copy of that agreement.
This section is identical to s. 58.19(3) of the former Employment Standards Act.
This section indicates that Part XX does not apply to directors of corporations to which:
As such, those types of directors do not have any liabilities as directors under the Employment Standards Act, 2000.
Part III of the Ontario Corporations Act applies to not-for-profit corporations.
The Co-operative Corporations Act is provincial legislation that governs such entities as housing co-ops. It applies to corporations incorporated as cooperatives and carrying on business on a co-operative basis. The phrase "cooperative basis" is defined in s. 1(1) of the Co-operative Corporations Act as follows:
Section 80(3) states that Part XX does not apply to directors (or persons performing similar functions as a director) of a college of a health profession or of a college of a group of health professions that is established or continued under an Ontario statute. As such, those types of directors do not have any liabilities as directors under the Employment Standards Act, 2000.
For example, the College of Physicians and Surgeons of Ontario is established under the Regulated Health Professions Act, 1991, S.O. 1991, c. 18. Accordingly, Part XX does not apply to the directors of the College of Physicians and Surgeons of Ontario.
Section 80(4) provides that Part XX of the Act does not apply to directors of corporations that are incorporated in another jurisdiction (usually federally-incorporated companies that are subject to provincial labour jurisdiction and are doing business in Ontario) if they:
Directors are exempt from the application of Part XX only if all three conditions set out in paragraphs (a), (b) and (c) are met. See, for example, Pensler v. Adams, 2012 ONSC 2369 (CanLII) where the Divisional Court dismissed an application for review of Pensler v. Adams, 2011 CanLII 32018 (ON LRB), a decision by the Ontario Labour Relations Board in which the Board rejected the director's argument that s. 80(4) should be interpreted as exempting directors from Part XX if any of paragraphs (a), (b) or (c) apply.
This section deals with step two in the four step process for applying ESA Part XX, which is determining whether one of the circumstances in which directors will be liable exists.
Subsection 81(1) sets out the four circumstances in which directors' liability for certain unpaid wages is established.
Subject to s. 81(7) the liability is joint and several. Joint and several liability does not mean that every director is necessarily liable for all of the monies that a single director is liable for under the Employment Standards Act, 2000. Rather, it means that each individual director can be ordered to pay the full amount of liability as opposed to apportioning the total liability amongst the directors. Each individual director's liability is ascertained by applying ss. 81(3)-(7), which entails having regard to the dates the director was a director.
When more than one director’s order to pay ("DOTP") is issued because there are multiple directors, all of whom have liability, the joint and several liability principle will often result in the sum total of those DOTPs exceeding the amount owed to the employee or employees. If the application of the joint and several liability principle results in more money being recovered from the directors than was owed to the employee(s), the excess is refunded to the directors on a pro rata basis.
The joint and several liability principle means that the officer can issue orders to the directors for the full amount of their individual liability (i.e., a DOTP to Director A for $1200 and a DOTP to Director B for $1200) even though the total amount ordered ($2400) exceeds the amount owed to the employee ($1200).
The joint and several liability principle means that the officer can issue orders to the directors for the full amount of their individual liability (i.e., a DOTP to Director A for $600 and a DOTP to Director B for $1200) even though the total amount ordered ($1800) exceeds the amount owed to the employee ($1200).
The four circumstances in which director's liability for certain unpaid wages is established are as follows:
A director becomes liable for certain unpaid wages where the employee has filed a proof of claim directly with the court-appointed receiver or the trustee, and the claim remains unpaid. Note that the amount that can be ordered to be paid under a DOTP may be affected by payments made under the federal Wage Earner Protection Program (“WEPPA”) - see the discussion of WEPPA Payments in s. 81(7) below.
A director becomes liable for certain unpaid wages if an employer to whom an order to pay wages was issued neither pays the order in full nor files an application for review under ESA Part XXIII, s. 116.
This provision works in concert with ESA Part XXII, s. 107. It means that where an employment standards officer issued an order to pay to some but not all of the directors of a corporation, and the order(s) to pay remain(s) unpaid, and neither the employer nor the director has applied to have it reviewed, the other director(s) who were not yet issued an order become liable for the unpaid wages.
A director becomes liable for certain unpaid wages if a decision of the Ontario Labour Relations Board orders the employer or director(s) to pay wages to the employees, and the amount ordered has not been fully paid.
Subsection 81(2) provides that the employer is primarily responsible for the employee's wages, but the proceedings against the employer do not have to run their full course before an order to pay can be issued against a director.
See also Re v. Sagar Aggarwal, a director of 1189508 Ontario Ltd.. This decision, made under the former Employment Standards Act, also ruled that the Ministry need not first execute against the assets of a more active director before turning to a director who took no active part in the business.
These subsections deal with step three in the four-step process for applying ESA Part XX: establishing which types of unpaid wages directors are liable for.
Note that “regular earnings” is a non-statutory term used to refer to all wages other than vacation pay, public holiday pay, overtime pay, termination pay (or vacation pay on termination pay) and severance pay, and amounts that are deemed to be wages under the Employment Standards Act, 2000. Regular earnings would be, for example, earnings derived from hourly wages, salary, commission earnings, piecework earnings, shift premiums, and non-discretionary bonuses. It also includes any top-up required to be paid under ESA Part XV, s. 60(1)(b).
This section deals with step four in the four-step process for applying Part XX: determining the quantum of unpaid wages a director is liable for.
The wording of s. 81(7) is consistent with the directors' liability provision in s. 131(1) of the Ontario Business Corporations Act, R.S.O. 1990, c. B.16 ("OBCA"). The OBCA provision must be enforced through civil proceedings, whereas s. 81 liability can be enforced with the relatively expeditious and inexpensive administrative proceedings provided for in the Employment Standards Act, 2000.
The recoverability of unpaid wages through a DOTP is limited by ESA Part XXII, s. 111, which states that an employee cannot recover wages (including vacation pay) that came due more than two years preceding the date the complaint was filed or an inspection commenced. Because s. 111 also applies to corporate employer orders to pay wages, for practical purposes, the determination of an individual director's liability starts by referencing the monies that were assessed to have been owing by the corporate employer within the confines of s. 111. Accordingly, to determine each individual director's maximum liability:
Directors' liability under s. 81 for wages other than vacation pay is limited to debts not exceeding six months' wages, as described in s. 81(3), that became payable while they were directors. The word “debts” is a substantially broader term than wages, but the reference to s. 81(3) makes it clear that liability is imposed only for debts that fall within the definition of wages - in fact, only a sub-group of them, since there is no directors' liability for termination pay, severance pay or amounts that are deemed to be wages. The real significance of the use of the word debts is that it repeats wording that is used in s. 131 of the OBCA and in other business corporations legislation that imposes liability on directors for amounts owed to employees; it thereby effectively incorporates the case law under that legislation. That case law is clear that the limitation of all debts not exceeding six months' wages was intended to create merely a quantitative limit and not a limitation based on the nature of the debt; in other words, all debts owed to employees were covered, whether or not they were wages, though subject to certain other limitations, but the liability could not exceed an amount equivalent to six months' wages. See, for example, Proulx v. Sahelian Goldfields Inc.., 2001 CanLII 6255 (ON CA).
As noted above, liability imposed under s. 81 is very definitely limited to wages, but the fact that the language in which liability is imposed echoes that used in business corporations legislation shows that the phrase “six months' wages” was intended merely to set a limit on quantum and was not meant to require that the wages in question have been payable in any particular six months or any particular six-month period, although insofar as any individual director's liability is concerned, the wages must have become payable while that director was in office. However, note that the ESA Part XX, s. 111 limitations imposed on an officer's authority to issue an order to pay may have an impact on recoverability through such an order.
Unlike the reference to six months' wages in s. 81(7), the reference to two years in ESA Part XXII, s. 111 do not establish limitations based on an amount; rather they establish limitations relating to when the wages in question became due.
The limitation on the recovery of vacation pay in ESA Part XX, s. 111 is related to when the vacation pay came due. Subsection 81(7) limits directors’ liability for vacation pay to what was accrued while they are directors, for up to 12 months. That means the officer must first determine what vacation pay came due in the two years preceding the date the claim was filed, as only that vacation pay is recoverable under ESA Part XX, s. 111. The officer would then apply s. 81(7) with the result that the director's liability for the vacation pay recoverable under ESA Part XX, s. 111 would be limited to that portion that accrued while the director was a director, to a maximum of 12 months of accrued vacation pay.
For example, assume an employee had commenced employment on February 1, 2016 and resigned on March 1, 2017. They have not taken any paid vacation or received any vacation pay during their entire period of employment. When they did not receive any of the outstanding vacation pay on March 15, 2017, the payday following their resignation, they filed a claim for it under the Employment Standards Act, 2000 on April 15, 2017. As all of the vacation pay that accrued during the course of their 13 month employment was due on March 15, 2017, it was all recoverable under s. 111(1). However, in issuing an order against a corporate director of the employer, the director's liability is limited to the vacation pay that accrued while they were a director, to maximum of 12 months of accrued vacation pay. In this case, assuming the director was a director for the full period of the claimant's employment, the director would be liable for any 12 of the 13 months of accrued vacation pay, as per s. 81(7).
A corporate employer order to pay was issued with respect to a claimant who had an annual salary of $40,000 for:
Start with the corporate employer assessment - this will be the maximum potential liability for an individual director. In this example, this is:
Regular earnings, overtime pay and public holiday pay:
Accordingly, the director is liable for all of the unpaid regular earnings ($1500), overtime pay ($2000), and public holiday pay ($300).
Vacation pay:
Accordingly, the director is liable for all of the unpaid vacation pay ($400) and a DOTP can be issued for that amount.
Start with the corporate employer assessment, as limited by s. 111(1). This is the maximum potential liability. In this example, this is $2700 in vacation pay.
Therefore, the director is liable only for $1800 in unpaid vacation pay (12 months × $150 per month), and a DOTP can be issued for that amount.
Note: if the amount of vacation pay that accrued monthly changed over the course of the 18 month period, the officer is able to select which 12 months to use when determining the limit on the director's liability.
On February 20, 2015, the Stronger Workplaces for a Stronger Economy Act introduced a number of transitional provisions that imposed limitations on recovery. Subsections 111(3.1) to (8) imposed a six-month limitation period on unpaid wages that became due before February 20, 2015, and a 12-month limitation period for repeated contraventions and vacation pay that became due before February 20, 2015. Subsection 103(4) imposed a cap of $10,000 on the amount of wages an employment standards officer could order for a single employee with respect to wages that came due prior to February 20, 2015. Subsection 103(4.1), which was also added to s.103 by the Stronger Workplaces for a Stronger Economy Act, 2014 effective February 20, 2015, eliminated the $10,000 cap with respect to orders for unpaid wages that come due on or after that date. Subsections 103(4) and 103(4.1) and ss. 111(3.1) to (8) were transitional provisions and were repealed on February 20, 2017.
Although these sections are now repealed, it is Program policy that the $10,000 cap and limitation periods imposed by the transitional provisions continue to apply to wages, repeated contraventions and vacation pay that became due before February 20, 2015, even if any associated orders are issued after February 20, 2017. This is to preserve the vested legal rights of the parties at the time the contravention occurred. This is relevant in situations where a period of time lapses between the time a claim is filed and the time a claim is investigated.
Note, however, that the $10,000 cap imposed on orders against employers by s. 103(4) with respect to wages that came due prior to February 20, 2015 is not applicable to orders issued against directors under s. 106 or s. 107. Accordingly, the $10,000 cap does not apply to orders against directors.
See ESA Part XXII, s. 103 and ESA Part XXII, s. 111 for further discussion on the transitional provisions.
A corporate employer order to pay was issued with respect to a claimant who had an annual salary of $40,000 for:
Start with the corporate employer assessment as limited by the six month/12-month limitation periods set out in s. 111(3.1), (4) and (3.2), without regard to the $10,000 cap on orders to pay wages that became due prior to February 20, 2015. This will be the maximum potential liability for an individual director. In this example, this is:
Accordingly, the director is liable for all of the unpaid regular earnings ($1500), overtime pay ($2000), and public holiday pay ($300).
Accordingly, the director is liable for all of the unpaid vacation pay ($400) and a DOTP can be issued for that amount.
Although the proof of claim is not subject to s. 111 limitations, the DOTP is, so before determining an individual director's liability, s. 111 must be applied. For example:
A proof of claim was filed with respect to an employee who had an annual salary of $40,000 for:
The director was a director throughout the 2014 calendar year.
Start with the corporate employer assessment as limited by the six-month/12-month limitation periods regarding wages that became due prior to February 20, 2015, but without regard to the $10,000 cap that applies to wages. This is the maximum potential liability for an individual director. In this example, this is:
With respect to regular earnings, overtime pay and public holiday pay:
Accordingly, the director is liable for all of the unpaid regular earnings ($1500), overtime pay ($2000) and public holiday pay ($300).
With respect to vacation pay:
The director is liable for all of the unpaid vacation pay ($400) and a DOTP can be issued for that amount.
Start with the corporate employer assessment, as limited by the six month/12 month limitation periods in s. 111(3.1) and (4) regarding wages that became due prior to February 20, 2015, without regard to the $10,000 cap on the corporate order. This is the maximum potential liability. In this example, this is $12,000 in overtime pay.
Accordingly, the director is liable for $12,000 and a DOTP can be issued for that amount.
In determining a director's potential liability, the timing and validity of any resignation of directorship must be examined. The rules around resignations are:
Whether (and when) a director has resigned is a question of fact.
In Navas v. Blakemore, where the director communicated his resignation orally to the Vice President/Executive Director and asked for a letter acknowledging his resignation. The Vice President/Executive Director provided the director with a letter dated November 14 that was addressed to the director and signed by the Vice President/Executive Director, which read in part: "Re: Acceptance of Directorship Resignation: Luis, as requested, I have removed you as a Director of NGMA Products effective immediately." The corporate filings were not updated to reflect any resignation. The Ontario Labour Relations Board, relying on an Stewart v. Canadian Broadcasting Corp., 1997 CanLII 12324 (ON SC), ruled that the November 14 letter that originated from the company satisfied the statutory requirement that there be a "written resignation . . . received by the corporation."
Also see Pollock v. Somes, 2006 CanLII 18686 (ON LRB), where the Ontario Labour Relations Board accepted a fax return report together with oral evidence from the director as to the content of the fax transmission to conclude that written resignations were received by the corporation on the date indicated on the fax return report, despite what the corporate filings indicated.
Subsection 81(7) indicates that directors will only be liable for wages other than vacation pay that become payable while they are directors of the corporation. Wages become payable on the regular pay day of the employer, as established by the practice of the employer.
For example, if a director resigns in the middle of a pay period, that director would not be liable for the unpaid wages that became due on the payday following their resignation.
Subsection 81(7) states that directors are liable for vacation pay that accrued while they were a director.
For percentage-based vacation pay (e.g., the Employment Standards Act, 2000 minimum standard of either four or six per cent of earnings), a director would be liable for vacation pay calculated on wages the employees earned while they were a director. It is the date the vacation pay was accrued that is relevant to the director's liability, not the date it was to have been paid.
For service-based vacation pay (e.g., 1½ days of paid vacation for every month of service), a director would be liable for vacation pay that accrued based on service that occurred while they were a director. Again, a corporate employer's liability for vacation pay is determined by when the vacation pay was due, but a director's individual liability for some or all of that vacation pay is determined by when that vacation pay was accrued.
The liability against directors is an absolute liability. This is also known as strict liability.
This means that once it is established that an individual was a director at the relevant time, there is no basis for relief against that person's liability, not even if the director shows that they exercised due diligence.
Directors may argue that they are not liable because they have not been active as a director for years, or that were only ever a director in name only and had no influence over the company. Unless that person can rebut the presumption that they were a director during the relevant period, that person is liable as a director under Part XX even if they did not play any active role in the corporation at the time the liability arose.
See for example Arcese Inc. v. Alves, 2007 CanLII 35668 (ON LRB) where the Ontario Labour Relations Board ruled that two directors were liable even though they maintained that they were not the directing minds of the company. They argued that they were directors in name only and had no control or influence over the company, no signing authority, no voting power, and disagreed with many of the actions of the other two directors. The Board ruled that the Employment Standards Act, 2000 "makes no distinction between directors that control a company and those who are directors in name only", and upheld the orders that were made against them.
When an officer is issuing a DOTP where the corporate employer is formally insolvent, the amount that can be ordered to be paid under the DOTP may be affected by payments made under the federal Wage Earner Protection Program Act, SC 2005, c. 47, s. 1 ("WEPPA").
Where a claimant has received a WEPPA payment and the officer is issuing a DOTP, it is the Program's position that the officer must offset the WEPPA amount from the amount of the DOTP. If the WEPPA payment only accounts for a portion of the wages owed, the DOTP is issued for the outstanding balance to the extent that a director is liable for the outstanding amount.
A regulation under the WEPPA establishes that WEPPA payments are allocated first to wages, second to disbursements of a traveling salesperson under certain conditions, third to vacation pay, fourth to termination pay, and lastly to severance pay.
It is the Program's position that officers must abide by the characterization of the WEPPA payment as supplied by the trustee, who is bound to follow the federal regulation regarding the allocation of the payment.
The question has arisen as to how to account for the difference in the definition of wages in the WEPPA versus the Employment Standards Act definition. In particular, wages under the WEPPA includes "gratuities accounted for by the employer" and the Employment Standards Act definition excludes tips and gratuities. This raises the question of how the WEPPA payment should be characterized where a claimant is owed gratuities from the employer and is also owed wages as defined in the Employment Standards Act.
It is the Program's position that, in a situation where gratuities are an issue, the WEPPA payment be allocated based on the same proportion as the claim accepted by the trustee.
For example, if an employee is owed $2500 in wages as defined in the Employment Standards Act and $2500 in gratuities accounted for by the employer and is paid a $3000 WEPPA payment, then the WEPPA payment could reasonably be seen as allocated 50/50 between the Employment Standards Act defined wages owed to the employee and the gratuities owed to the employee, barring evidence to the contrary in any given case.
Pursuant to a regulation under the WEPPA, the WEPPA program automatically deducts 6.82% from any amount that is owed to employees. This means that an employee will never be made absolutely whole through a WEPPA payment. Accordingly, there will always be an outstanding amount that could be the subject of a DOTP.
For example, assume an employee has a legitimate claim for $1000 in unpaid wages that attracts director liability. If the WEPPA program makes only a $931.80 payment (due to the regulation requiring a 6.82% reduction), then a director could be ordered to pay $68.20 so that the claimant could be made whole.
Subsection 81(10) indicates that if there is a conflict between a limitation period in another statute regarding directors' liability and the limitation periods in ESA Part XXII, s. 114, the limitation period in the Employment Standards Act, 2000 applies, unless the other statute states specifically that the limitation period in that other Act is to prevail over the Employment Standards Act, 2000.
Section 114 states that no order to pay wages, fees or compensation (or notice of contravention) will be issued:
Subsection 131(2) of the OBCA states:
Similar provisions appear in s. 81(2) of the Business Corporations Act, R.S.O. 1990, c. C.38, which governs non-profit corporations.
It is clear that there is a conflict between the limitation period in the Employment Standards Act, 2000 and the limitation periods in s. 131(2) of the OBCA, and s. 81(2) of the Ontario Corporations Act. Since the OBCA and the Corporations Act do not expressly state that they are to prevail over the Employment Standards Act, 2000 in the event of a conflict, the limitation periods in the Employment Standards Act, 2000 will apply with respect to the Ministry's ability to issue an order against a director under the Employment Standards Act, 2000. If proceedings are taken under the OBCA or the Corporations Act, the limitation periods in those statutes would apply.
This section is identical to s. 58.28(1) under the former Employment Standards Act.
Section 82(1) provides that a director cannot contract out of liability under the Employment Standards Act, 2000, whether such purported relief is contained in the articles of incorporation, the corporate by-laws, a resolution of the Board of Directors, or the shareholders, or by way of contract. This is in keeping with the general no waiver or no-contracting out provision in s. 5(1) of the Employment Standards Act, 2000.
See, for example, Otema Store Interiors Ltd. v. Aitkaliyev, 2008 CanLII 20823 (ON LRB) where the director of Otema Store Interiors Ltd.. argued that he had no liability under Part XX because a corporation had purchased the assets of Otema Store Interiors Ltd. and a memorandum of understanding that was part of the sale agreement stipulated that the purchaser would pay those employees who were hired by the purchaser any vacation pay that was owing to the employees at the time of the sale. The director of Otema Store Interiors Ltd. argued that he had divested himself of Employment Standards Act liabilities by way of the memorandum of understanding and should not be held liable for vacation pay that he admitted was owing to the claimants at the time of the sale. The Ontario Labour Relations Board disagreed. It ruled that s. 82 precluded the Board from giving any weight to the Memorandum of Understanding and affirmed the Director Order to Pay.
What amounts to an exception to the "no contracting out" prohibition occurs where there is a unanimous shareholders' agreement ("USA") that relieves the directors of liability for wages and vacation pay. In such a case, the shareholders and not the actual directors are considered to be the "directors" for the purposes of liability under Part XX. See also the discussion of the definition of directors in s. 79 of the Act, which includes shareholders under a USA, in ESA Part XX.
This section is substantially the same as s. 58.28(2) of the former Employment Standards Act.
Section 82(2) mirrors corresponding provisions in corporations legislation, such as the Ontario Business Corporations Act, R.S.O. 1990, c. B.16, which state that a corporate employer may agree to reimburse a director or former director (or his or her heirs) for amounts incurred as a result of directors' liability provided that the director acted honestly and in good faith with regards to the best interests of the employer, and if the proceedings involve a fine or monetary penalty, where the director reasonably believed that he or she was not breaking the law.
This section is substantially the same as s. 58.29 in the former Employment Standards Act.
Section 83 states that Part XX does not affect any civil remedies that a director may have against any person or vice-versa. If, for example, an employee wishes to sue a director under the directors' liability provisions of the Ontario Business Corporations Act, R.S.O. 1990, c. B.16 ("OBCA"), the Ontario Corporations Act, R.S.O. 1990, c. C.38, or the Canada Business Corporations Act, R.S.C. 1985, c. C-44, the employee can do so. However, this provision should be read with reference to ss. 97 and 98 of the Employment Standards Act, 2000 which state that an employee has to choose between filing a claim with the Ministry and commencing a civil action in court for the same matter. For example, if an employee filed a claim with the Ministry under the Act for vacation pay, that employee could not subsequently commence a civil action under the OBCA for that vacation pay. Please refer to ESA Part XXII for a more detailed discussion of ss. 97 and 98. Where a director is relieved of responsibility for wages and vacation pay because there is a unanimous shareholders' agreement, this is consistent with this section, because in such a case the shareholders and not the actual directors are considered to be "directors" for purposes of liability under Part XX.
Part XXI (ss. 84 to 95 inclusive) is the source for the powers of those persons responsible for administering the Employment Standards Act, 2000.
The intent of these provisions of the Act is to provide for the day-to-day administration of the legislation through the powers and duties of the Minister of Labour, the Director of Employment Standards and employment standards officers.
The Minister of Labour is responsible to the Legislature and to the public for the administration of the Employment Standards Act, 2000. The language of this section is identical to the language in s. 59(1) of the former Employment Standards Act. That section was used as authority for the proposition that in employee applications for review under the Act, the claimant does not control the process. The Minister is the person responsible for the Act. Therefore, such enforcement processes as investigation, issuing an order and defending an order at a hearing are under the administration of the Minister, and are not under the control of the employee who filed the claim. See Dominion Electric Protection Co. Ltd. d.b.a ADT Energy Systems v. Hand (September 23, 1985), ESC 1950 (Baum).
The Minister of Labour appoints the Director of Employment Standards to administer the Employment Standards Act, 2000 and the regulations. This section is the source for the Director's powers and duties under the Act. The nature of the Director's powers and duties is spelled out in s. 88.
This provision is similar to the corresponding section (s. 59) of the former Employment Standards Act except that the former Employment Standards Act provided for the Minister to appoint an Acting Director. Sections 85 (2) and (3) allow the Director or the Deputy Minister, in the Director's absence, to name an employee of the Ministry to take over the duties of the Director in an "acting" capacity while the Director is unable to exercise the powers of the office, or while the office is vacant.
Section 86(1) is the authority for the appointment of employment standards officers. Once appointed, the officers have the authority to exercise powers and duties in accordance with s. 89 of the Employment Standards Act, 2000.
Section 86(2) requires that an appointment card be issued to all employment standards officers. The Deputy Minister must issue to each officer a card as evidence of his or her appointment. The card is evidence of the officer's appointment and authority to use the powers set out in ss. 89, 91 and 93.
The corresponding provision in the former Employment Standards Act (s. 62) also explicitly required an officer to present his or her card, as authority for the powers exercised or the duties carried out, if requested to do so by any person. This provision is now found in s. 91(5).
Section 87(1) is substantially the same as the corresponding section (s. 59(5)) of the former Employment Standards Act. It allows the Minister of Labour to delegate powers and duties to anyone he or she chooses. The delegation must, however, be made in writing.
Section 87(2) was introduced by the Employment Standards Act, 2000. It preserves the Minister's ability to exercise powers and perform duties that have been delegated to persons under this section.
Subsection 88(1) makes plain the distinction between the powers of the Director (those instances where the Employment Standards Act, 2000 says that the Director may do something) and the duties of the Director (where it is stipulated that the Director shall do something). This distinction accords with principles of statutory interpretation concerning permissive and mandatory language.
For example, the powers of the Director would include:
The duties of the Director would include:
This subsection allows the Director to establish policies regarding interpretation, administration and enforcement of the Employment Standards Act, 2000. The purpose of the provision is to promote province-wide, consistent interpretation and application of the Employment Standards Act, 2000.
This subsection should be read together with ESA Part XXI s. 89(2), which states that employment standards officers must follow any policies established by the Director under s. 88(2).
Subsection 88(3) sets out the authority of the Director to delegate various powers and duties to program staff. For information on such delegations see Delegation of Powers.
Note that in addition to the Director's general authority to delegate under s. 88(3), the Director has further, specific delegation authority in ESA Part VII, s. 17.3 and in ESA Part VIII, s. 22.2.
Section 88(4) preserves the Director's ability to exercise powers that have been delegated to persons under s. 88(3).
Subsection 88(5) authorizes the Director, with the Minister's approval, to decide what rates of interest and the manner of its calculation for the purposes of the Employment Standards Act, 2000.
The Fair Workplaces, Better Jobs Act, 2017, S.O. 2017, c. 22, amended s. 88(5), effective January 1, 2018 to allow the Director of Employment Standards to set multiple rates of interest for any amounts owing under different provisions of the Employment Standards Act, 2000 and its regulations, as well as money held in trust by the Director.
No specific rates of interest are currently in place under this section.
Subsection 88(6) clarifies that the Director's determination of an interest rate under s. 88(5) is not a regulation.
Subsection 88(7) is intended to provide consistency in the calculation of interest on and payment out of monies that had been paid into the Director in trust, where there are no provisions for paying it out elsewhere in the Employment Standards Act, 2000. For example, this section would apply where employees have elected to retain recall rights under a collective agreement and the termination and/or severance pay monies were paid to the Director in trust and are subsequently paid out to the employer or employees under ESA Part XV, ss. 67(8) and (9).
Subsection 88(8) allows for any excess interest earned on the monies held in trust to be used to pay service charges levied by the financial institution in which the money was deposited.
Subsection 88(9) provides that the Director is not required to hold hearings when exercising powers under the Employment Standards Act, 2000. Because the Director's statutory powers are such that a person's rights can be affected, (e.g., approving severance payments by instalment and approving the extension of a temporary lay-off) there is a possibility that principles of natural justice may require the Director to hold a hearing if not for this provision.
This provision is consistent with s. 89(3), which states that employment standards officers are not required to hold hearings when exercising any power or making any decision under the Employment Standards Act, 2000.
Section 88.1 was added to the Employment Standards Act, 2000 by the Good Government Act, 2006, S.O. 2006, c. 19, effective June 22, 2006. The section permits the Director of Employment Standards to transfer the investigation of a complaint or inspection from an employment standards officer to another employment standards officer.
The Director's authority to reassign a file is discretionary. An example of when the Director might consider exercising his or her discretion is if the original investigating officer was indisposed and could not be expected to complete the investigation in a timely way.
If the Director did reassign a file under this section, the new officer would able to rely, but would not have to rely, on any findings of fact and the evidence collected by the first officer. The new officer would also be able to collect new evidence and make new findings.
This subsection enables the Director of Employment Standards to give recognition to an employer, for example, for a high rate of compliance with the Employment Standards Act, 2000, or exceptional performance measured in accordance with prescribed criteria. Currently, no criteria are prescribed.
This subsection establishes that the criteria or system of recognition may be divided into different classes of employer with different criteria for each.
This subsection empowers the Director to require any information related to the recognition, for the purposes of granting, reviewing or revoking a recognition from either an applicant for same or an employer who is has already received a recognition.
This subsection permits the Director to publish general information, such as the number of recognitions granted within a particular time period and the names of employers that have received recognitions.
A recognition granted by the Director may specify a time period within which it will remain valid. It will cease to be valid after that point.
The Director has the power to revoke or amend a recognition. For example, if an employer no longer fulfills the criteria that support a recognition the Director would be able to revoke it.
This subsection empowers the Director to authorize or delegate all of the powers of granting, revoking or amending recognition to an employer as well as requiring an employer to provide information.
Although the Director may delegate powers established by s. 88.2, the Director retains the ability to exercise any power under s. 88.2 simultaneously.
Under s. 88.3(3), an individual who has been authorized by the Director of Employment Standards to grant, amend or revoke an employer recognition under s. 88.3(1), is required to follow any policies established by the Director under s. 88(2) related to the exercise of that authority. Subsection 88(2) empowers the Director to establish policies “respecting the interpretation, administration and enforcement of this Act”. If the Director does so in relation to employer recognition per s. 88.2, any person authorized by the Director to exercise a power under s. 88.2 is required to follow those policies.
Section 89(1) parallels s. 88(1), concerning, in this case, the powers and duties of an employment standards officer. As in s. 88(1), this section emphasizes the distinction between what the officer may do and what the officer must do.
For example, "the powers of an employment standards officer" would include:
The "duties of an employment standards officer" would include:
This provision was introduced by the Employment Standards Act, 2000. Section 89(2) imposes an obligation on employment standards officers to follow the policies established by the Director under s. 88(2) respecting the interpretation, administration and enforcement of the Act.
This provision was introduced by the Employment Standards Act, 2000. Section 89(3) clarifies that an employment standards officer may exercise any power under the Act, e.g., to conduct inspections, investigate complaints, require attendance at meetings under s. 102 or make any decision under the Act, without holding a hearing. Section 89(3) makes it clear that the officer is not required to hold a hearing when exercising those powers or making a decision under the Act. In the absence of this section, it might be argued that principles of natural justice may impose an obligation on the officer to hold a hearing. See also the discussion of the Director's power in s. 88(2) of the Act to establish policies at ESA Part XXI, s. 88(2).
Generally speaking, the effect of this provision is that an employment standards officer cannot testify in a civil proceeding. Not only is an officer not "compellable" (meaning that an officer cannot be required to give testimony); an officer is also not "competent" to give testimony (meaning that he or she cannot give testimony even on a voluntary basis).
The term "civil proceeding" obviously includes a court proceeding, but it also includes a proceeding before a tribunal, such as the Ontario Labour Relations Board, or an arbitrator. See Ontario Nurses' Assn. v. Extendicare (Canada) Inc., (Kirkland Lake) (Burke Grievance). However, it does not include a criminal proceeding.
Note that there is an exception to the "not competent, not compellable" rule-an officer is both a competent and compellable witness where his or her testimony would be given for the purpose of carrying out his or her duties under the Employment Standards Act, 2000. Program policy is that this includes the giving of testimony in hearings under ss. 116, 121 and 122 of the Act.
Generally speaking the effect of this provision is that an employment standards officer cannot be required in a civil proceeding to produce anything (such as a record) that he or she acquired while performing an inspection or investigation under the Act.
The term "civil proceeding" obviously includes a court proceeding, but it also includes a proceeding before a tribunal, such as the Ontario Labour Relations Board, or an arbitrator. See Ontario Nurses' Assn. v. Extendicare (Canada) Inc., (Kirkland Lake) (Burke Grievance). However, it does not include a criminal proceeding.
Note that an officer could be required to produce something acquired while performing an inspection or investigation where it is for the purpose of carrying out his or her duties under the Act. Further, a record or part of a record acquired by an officer may be accessible under the Freedom of Information and Protection of Privacy Act, R.S.O. 1990, c. F.31.
Subsection 91(1) provides that the officer may enter and inspect any place for the purposes of investigating a possible contravention or to perform an inspection to ensure the Employment Standards Act, 2000 is being complied with. "Any place" indicates that the officer may enter not only the premises of the employer, but any premises belonging to any person who may have records or knowledge relevant to the investigation or inspection. Furthermore, there is nothing in the section that would limit the officer to a single visit to accomplish the investigative or inspection tasks. There are limitations on this right of entry in ss. 91(2), (3) and (4) discussed below.
The corresponding section (63(1)(a)) in the former Employment Standards Act limited entry, in the absence of a warrant, to "any reasonable time or times." Subsection 91(2) allows the employment standards officer to enter and inspect a place only during its regular business hours and if it has no regular business hours, during daylight hours. This provision is intended to provide the officer with a right of entry. If the employer had no regular business hours but offered or agreed to allow the officer to enter and inspect the premises at night, this section would not prevent the officer from accepting the employer's offer or agreement to do so.
This provision is substantially unchanged from the corresponding provision (s. 63(2)) in the former Employment Standards Act Subsection 91(3) is a limitation on the power of the employment standards officer to enter into premises. If the premises are used as a dwelling or living quarters, then the officer must have the consent of the person occupying the premises or must obtain a search warrant under s. 92.
If the workplace is a nuclear facility, to which provincial employment standards legislation applies as of April 1, 1998, the search warrant is to be obtained under ss. 487 of the Criminal Code. See the discussion at ESA Part XXI, s. 94 regarding provincial jurisdiction in nuclear operations as well as ESA Part III, s. 3(2) for general information regarding federal/provincial jurisdiction. Given that nuclear facilities are unlikely to be used as dwellings, this last point is likely of intellectual interest only.
For situations where a search warrant may be required, the officer should consult Legal Services Branch.
This provision was introduced by the Employment Standards Act, 2000, although it merely codifies Program practice under the former Employment Standards Act. Subsection 91(4) makes it clear that an officer is not entitled to use force to enter and inspect a place.
This provision is essentially unchanged from ss. 62(2) of the former Employment Standards Act Subsection 91(5) provides that the card issued by the Deputy Minister as evidence of an employment standards officer's appointment — see ESA Part XXI, ss. 86(2) — must be produced on request. The card is evidence of the authority under the Act for the powers exercised or duties performed by the officer.
Subsection 91(6) is similar to the corresponding provision (ss. 63(1)) in the former Employment Standards Act. Subsection 91(6) sets out the officer's powers to examine, require for production, remove for review and copy records and other things that are relevant or the officer considers relevant to an investigation or inspection. Subsection 91(6)(a) was amended by the Good Government Act, 2006, S.O. 2006, c. 19, effective June 22, 2006. It previously stated that the officer could "examine a record other thing that is relevant to the investigation or inspection." The amendment clarified that records etc. could be examined so long as the officer thinks they may be relevant.
Subsection 91(6) also allows the officer to order records to be produced in a readable form and to question any person on any matter the officer thinks may be relevant to the investigation or inspection. The broad language of the section with respect to a "record or other thing" was intended to ensure that all things relevant to the investigation or inspection would be made available to the officer. However, in the performance of all his or her duties under the Act, the officer would be expected to act reasonably. Such a restriction would also apply to the officer's determination that a record, thing or matter was relevant to the investigation.
Clause 6(a) allows the officer to examine records or things relevant to the investigation or inspection. The term "record or other thing" is very broad and could include books of account, ledgers, vouchers, letters patent, by-laws, minutes of directors' meetings as well as other documents or things.
Clause 6(b) allows the officer to require production of records or other things he or she thinks are relevant to the investigation. If the records or other things are not produced upon request the officer may require production through a demand in writing under ss. 91(7). See discussion under ss. 91(7) and (8) below.
Note: Officers may also compel production of records or other things at a meeting scheduled under s. 102. Note also that the Director's separate power to require production of records in ss. 74(1) of the former Employment Standards Act has been eliminated.
Clause 6(c) allows an employment standards officer to remove records or other things for review and copying. This clause must be read in conjunction with ss. 91(9), which requires the officer to provide a receipt and to return the records or other things within a reasonable time.
Clause 6(d) allows an employment standards officer, for the purpose of ensuring that the Act and regulations are complied with, to copy any records such as electronic records or documents into a readable form using devices or systems normally used in carrying on business in the place. For example, an officer could require the employer to transfer electronic payroll records onto a USB drive.
Clause 6(e) allows an employment standards officer to question any person on any matter the officer thinks may be relevant to the investigation or inspection. The officer may interview such persons separately by virtue of ss. 91(13) (see discussion of ss. 91(13) below). See also the discussion under s. 91(12) regarding the positive duty to answer questions that the officer thinks may be relevant to the investigation or inspection.
Employment standards officers have the power to require production of records or other things thought to be relevant to an inspection or investigation under ss. 91(6)(b). Where an officer's oral request for production is not complied with, he or she may demand production. This demand must be in writing and must specify the nature of what is being requested. A demand for "all records relevant to this claim" is probably too vague to meet the requirements of this section, while a demand for "all paper and electronic timesheets or payroll records for the period . . . to . . ." would likely be sufficient. Under ss. 91(8) the person who has custody of such records or other things must comply with the demand.
This provision is similar to the corresponding provision in the former Employment Standards Act in ss. 64(2) and (3). It means that an employment standards officer may, for the purpose of ensuring that the Act and regulations are complied with, demand (in writing as per ss. 91(7)) the person who has custody of a record or thing to produce it and to provide any assistance reasonably necessary to interpret it or to produce it in a readable form. This could include printing out and explaining the employer's payroll records as well as requiring the employer to transfer electronic records onto a USB drive for the officer. The scope of the language is broad enough that anything less than full cooperation may be viewed as a violation. Note that the officer may require any "person" to provide assistance under this section given that there may be persons other than (for example) the employer who have custody of records or documents relevant to the investigation. See the discussion concerning the definition of "person" in ESA Part I, s. 1.
This provision is similar to ss. 63(1)(c) of the former Employment Standards Act Subsection 91(9) allows an officer to take records or other things in order to facilitate an inspection or investigation. The officer is required however to return such records or things within a reasonable time. The receipt for records ensures that the owner of the records has a simple way of reclaiming the records, and the officer's file will indicate when and where these records were borrowed and subsequently returned.
Subsection 91(10) provides that a copy of any record certified by an employment standards officer as a true copy is evidence of the record in the same way the original would be.
Subsections 91(10.1) – (10.5) were introduced into the ESA by the Supporting Recovery and Competitiveness Act, 2021 effective June 3, 2021. These subsections create another power – in addition to those established in ss.91(6) - that officers can use when conducting inspections: the authority to require an employer to conduct an examination (often referred to as a “self-audit”) of its records and/or practices regarding the ESA and to report the findings to the officer.
Prior to the amendments made by the Supporting Recovery and Competitiveness Act, 2021, a system relating to self-audits was set out in in a separate section of the Act, s.91.1 of the ESA. Section 91.1 was repealed by the Supporting Recovery and Competitiveness Act, 2021 at the same time that subsections 91(10.1)-(10.5) came into effect. With the amendments, the authority to require an employer to conduct and report on a self-audit became one of the powers available to an officer for use in the course of conducting an inspection.
Under ss.91(10.1), an employment standards officer conducting an inspection may, by providing written notice to an employer, require the employer to conduct an examination of the employer's records, practices or both in relation to one or more provisions of the ESA or its regulations.
Subsection 91(10.2) provides that if an employer is required to conduct an examination (i.e. a “self-audit”) pursuant to ss.91(10.1), the employer must conduct that examination and report the results of the examination to the officer. The employer's report must comply with the requirements set out in the officer’s notice. Subsections 91(10.3)-(10.5) address what the notice must or may specify: see below for information.
91.(10.3) A notice given under subsection (10.1) shall specify,
Subsection 91(10.3) sets out three items that must be included in the officer’s written notice requiring the employer to conduct a self-audit under ss. (10.1):
With respect to (b), the officer can specify any provision or provisions in the ESA 2000 or its regulations to be included in the examination. (The only exception is with respect to the recovery of overpayments that were made by the WSIB to employers as reimbursement of money paid to employees for paid infectious disease emergency leave, a time-limited standard that was introduced into the ESA in April 2021. When determining whether there was an overpayment, officers do not have the authority to use the self-audit powers – see O. Reg. 637/21, ss. 1(2).)
91(10.4) A notice given under subsection (10.1) may specify,
Subsection (10.4) states that the officer's notice to the employer may:
Subsection (10.5) sets out examples of the type of information that the officer may require the employer to include in the report pursuant to clause (10.4)(c), if the officer considers it appropriate. Those items are examples only. In other words, officers are not limited by what is set out in subsection (10.5) and can require the employer to provide any additional information in the report that the officer considers appropriate. For example, if an officer considers it appropriate, the officer can require the employer to include in the report the names of all employees who were included in the audit, not just the ones whom the employer assessed as being owed wages.
Subsection (10.5) provides examples of the type of information the officer can require the employer to include in the employer’s report pursuant to clause (10.4)(c), if the officer considers it appropriate.
Subsection (10.5) provides that, without restricting the generality of clause (10.4)(c), the officer’s notice to the employer to conduct a self-audit under ss.(10.1) can require the employer to include in its report:
These provisions are similar to those in s. 64 of the former Employment Standards Act. Sections 91(11) and (12) set out the level of compliance expected from people involved in an investigation or inspection by an employment standards officer. Note that the prohibition in this section may apply to any "person" who may be in a position to hinder, obstruct or interfere with an investigation or inspection. See the discussion concerning the definition of "person" in ESA Part I, s. 1.
The terms "hinder, obstruct or interfere with" in subsection (11) are intended to ensure that any person required to cooperate with the officer in his or her investigation or inspection does so.
Subsection 91(12)(a) imposes a positive duty to answer questions.
Subsection 91(12)(b) prohibits a person from providing an employment standards officer information that the person knows to be false or misleading (e.g. records or other things the officer requires to be produced pursuant to ss. 91(6)(b), answers to questions the officer asks pursuant to ss. 91(6), and information provided in a self-audit report required pursuant to ss. 91(10.2).)
Subsection 91(13) ensures that an officer may interview separately any people the officer thinks may have information relevant to the investigation or inspection; this helps to prevent "tailoring" of evidence.
This provision was introduced by the Employment Standards Act, 2000. It allows an employment standards officer to obtain a warrant for entry into premises which may include a business or dwelling, because the officer was unable or has reasonable grounds to believe he or she will be unable to enter the premises during regular business hours (or in the absence of regular business hours, during daylight hours) or to enter a dwelling without the consent of the occupier.
It also allows the officer to obtain warrants to examine, require for production, remove and copy or use data storage, information processing or retrieval systems normally used in the workplace to produce in readable form, records or other things the officer thinks may be relevant to the inspection or investigation. Lastly, it allows the officer to obtain a warrant in order to question any person on matters the officer thinks may be relevant to the inspection or investigation. (The only reference to warrants in the former Employment Standards Act was in s. 63(2) which required an officer to obtain a search warrant under section 158 of the Provincial Offences Act, R.S.O. 1990, c. P.33, in order to enter a dwelling without the consent of the occupier.)
Clause (c) was added by the Employment Protection for Foreign Nationals Act (Live-in Caregivers and Others), 2009, S.O. 2009, c. 32 ("EPFNA") effective March 22, 2010 (EPFNA was amended and renamed the Employment Protection for Foreign Nationals Act, 2009, effective November 20, 2015) to extend the circumstances under which a justice of the peace may issue a warrant for entry to include those situations where there are reasonable grounds to believe that an offence was committed or is being committed and that information or other evidence will be obtained by the officer through the production, examination or removal of records or other documents or by questioning a person.
Generally, this clause ensures that where an employment standards officer is investigating or inspecting at a site and comes to have reasonable grounds to believe that an offence has been committed, he or she will be able to obtain a warrant before continuing work at the site.
This subsection requires information under oath to satisfy a justice of the peace that the officer has been prevented or that there are reasonable grounds to believe that the officer will be prevented from exercising a right of entry under s. 91(1) or a power under s. 91(6) or that there are reasonable grounds to believe that an offence was or is being committed and information or other evidence will be obtained by the exercise of the officer's powers under s. 91(6).
This provision limits the effective period of a warrant issued under s. 92(1). Section 92(2) requires that a warrant issued under this section have an expiry date no later than 30 days after the warrant was issued. This 30-day period is subject to an extension under s. 92(3).
This section allows the warrant issued under s. 92(1) which must have an expiry date no more than 30 days after the warrant was issued (pursuant to s. 92(2)), to be extended for up to 30 days, on application of the officer named in the warrant and without notice to the persons subject to the warrant.
This provision will allow an officer to call the police for assistance to execute a warrant. For example, where an officer with a warrant issued under this section was denied entry to a workplace, he or she may call upon the police to assist the officer to enter the premises in order to conduct an investigation or inspection under the Employment Standards Act, 2000.
An officer who has obtained a warrant under this section may use it to gain entry under s. 91(1) or exercise any power under s. 91(6) only between the hours of 8 a.m. and 8 p.m. This restriction also applies to a police officer called to assist in the execution of the warrant. The only exception to this limitation is made where the warrant itself specifies otherwise. See, however, the discussion of s. 92(6) below that deals with the execution of a warrant obtained under this section.
This subsection was amended by the Government Efficiency Act, 2002, S.O. 2001, c. 9, effective November 26, 2002, by the deletion of a reference to s. 91(2). Because s. 92(6) deals with warrants issued under s. 92(5) and that subsection provides that a warrant may be executed between 8 a.m. and 8 p.m., there was a possible conflict in the reference to s. 91(2), which provides that an investigation and inspection can only be conducted during regular business hours, or where there are no regular business hours during daylight hours.
Subsection 92(6) provides that ss. 91(4) to (13) will apply to an officer executing a warrant issued under s. 92(1). See the discussion of these subsections above.
This subsection was added by EPFNA to ensure that where a warrant has been issued by a justice of the peace under s. 92(1) authorizing an employment standards officer to enter premises so that he or she may exercise his or her powers under s. 91(6), the officer is not limited to asking questions of witnesses related to the execution of the warrant. Specifically, it provides that in exercising his or her powers under s. 91(6)(e), the officer may question any person on any matter the officer thinks may be relevant to an investigation or inspection.
This provision is similar to s. 75 of the former Employment Standards Act but with an additional provision that allows officers to require the posting of reports or copies of a report. In addition, the authority to require posting under this section rests with the employment standards officer rather than the Director.
The notice referred to in clause (a) may consist of a general outline of all of the basic provisions of the Employment Standards Act, 2000 or, on the other hand, may focus on one or more standards or provisions of particular relevance to the workplace involved. The report or part of a report referred to in clause (b) may be a copy of the actual officer's report (or excerpts of it) prepared upon the conclusion of the investigation or inspection.
See also the discussion of the general posting requirement in s. 2 in ESA Part II, s. 2.
94 If a regulation is made under the Canada Labour Code incorporating by reference all or part of this Act or a regulation under it, the Board and any person having powers under this Act may exercise the powers conferred under the Canada Labour Code regulation.
This provision is substantially unchanged from its corresponding provision in the former Employment Standards Act (s. 75.2). Federal regulations made under the Canada Labour Code, R.S.C. 1985, c. L-2, make the federal Code provisions concerning employment standards (and labour relations and occupational health and safety) inapplicable to the nuclear operations of Ontario Power Generation and provide that Ontario law in these areas applies instead. The same regulations that "incorporate by reference" the Ontario statutes and regulations also provide that they may be enforced by the same bodies and persons who enforce the law provincially. Section 94 is intended to support this in the employment standards context by making it clear that the Ontario Labour Relations Board and other persons having powers under the Employment Standards Act, 2000 (such as employment standards officers and the Director of Employment Standards) have jurisdiction with respect to the federal regulation which incorporates the Employment Standards Act, 2000 and its regulations.
Section 95 was amended by the Employment Standards Amendment Act (Temporary Help Agencies), 2009, S.O. 2009, c. 9, effective November 6, 2009. The new section expanded the methods by which most documents can be served under the Employment Standards Act, 2000.
Please note that the methods of service set out in this section do not apply to notices of civil proceeding served on the Director (s. 8). For more information on the service provisions specific to notices of civil proceedings, please see subsections 8(3) – 8(5).
With the above exceptions, the methods of service set out in subsection 95(1) apply to the service of any orders, notices or other documents that must be served in accordance with this provision under the Act.
Clause (a) applies when serving a document on an individual, clause (b) applies when a document is to be served on a corporation, and clauses (c) to (f) apply to the service of a document on any "person" including an individual or a corporation. For interpretation of the term "person", please see ESA Part I, s. 1. Service effected per clause (g) must follow the Board's specifications.
In the case of service on an individual, service of a document can be effected by personally leaving a copy of the document with the individual.
In the case of service on a corporation, the service of a document can be effected by:
Whether a person is an officer or director of a corporation can generally be verified by consulting the most recent version of the relevant Corporation Profile Report.
This provision also allows a document to be served on, for example, a manager of one of the corporation's business outlets. Since service can be effected on a "person who appears to be in control or management", it follows that the person need not be manager so long as he or she appears to be in control of the operation at the location. For example, service might be effected on the single employee who is in charge of a kiosk operated by the corporation (assuming there was no off-site supervisor and the employee was considered to be in control of the operations at the kiosk).
Service can be effected on any person by verifiable mail where the document is sent to the person's "last known business or residential address". The specific reference to the residential address clarifies that the document can be sent to an employee's last known home address and where the employer is a sole proprietor who, for example, and has gone out of business, the order can be served at the individual's residence.
It is Program policy that three Canada Post services fall within the meaning of verifiable mail. These are Registered Mail, Xpresspost and Priority Courier. However, it is important to note that Xpresspost and Priority Courier will comply with the requirements of this provision only if the "signature upon delivery" option is selected.
A document may be served on any person by fax or electronic mail if the intended recipient has the necessary equipment to receive the fax transmission or electronic mail.
A document may be served on a person using a courier service.
Service may be effected by leaving the document, in a sealed envelope addressed to the person, with an individual who appears to be at least 16 years of age at the person's last known business or residential address.
As noted under "Service by Verifiable Mail — s. 95(1)(c)" above, the specific reference to the residential address clarifies that where the employer is a sole proprietor, for example, and has gone out of business, the order can be served at the individual's residence.
Finally, a document may be served in a manner ordered by the Board under subsection (8). Subsection 95(8) allows the Ontario Labour Relations Board to order that service be effected in a manner that it considers to be appropriate in the circumstances.
The following types of documents must be served in accordance with this section:
This provision was introduced by the Employment Standards Amendment Act (Temporary Help Agencies), 2009 which came into force on November 6, 2009.
This subsection must be read in conjunction with s. 95(1) which establishes the different methods by which most documents may be served. This provision states that where a document is served either:
The service is deemed to be effective at the time the document is left with the individual.
This provision was introduced by the Employment Standards Amendment Act (Temporary Help Agencies), 2009 which came into force on November 6, 2009.
Where a document is served in accordance with s. 95(1)(c) via mail addressed to the person's last known business or residential address using a method of mail delivery that permits the delivery to be verified, the service of the document is deemed to be effective on the fifth day after the document is mailed unless the person to whom the mail is sent establishes, per s. 95(6), that the service was not, in fact, effective at that time due to an absence, accident, illness or cause beyond the person's control.
Reference can be made to the Legislation Act, 2006, S.O. 2006, c. 21, Sched. F when interpreting the timing portion of this subsection. Section 89(3) of that Act states:
A reference to a number of days between two events excludes the day on which the first event happens and includes the day on which the second event happens, even if the reference is to "at least" or "not less than" a number of days.
This means that when determining the deemed service date, the day the document is mailed will not be counted, but the following calendar days are counted. For example, a letter mailed on a Wednesday is deemed to be served the next Monday. It is possible that the deemed service date could fall on a weekend or public holiday even if there is no mail service on that day. For example, if a document is mailed on a Tuesday, the service would be deemed to have taken place on the following Sunday.
Subject to s. 95(6), the deemed service date applies regardless of when the mail actually arrived at the recipient's address.
This provision was amended by the Employment Standards Amendment Act (Temporary Help Agencies), 2009, which came into force on November 6, 2009 and is similar to the previous subsection 95(2) of the Employment Standards Act, 2000.
Where a document is served by fax or email in accordance with s. 95(1)(d), the service occurs on the day the fax or email is sent unless the transmission occurs after 5:00 p.m. or on a Saturday, Sunday or a public holiday. If the document is faxed or sent via email after 5:00 p.m. or on a Saturday, Sunday or public holiday, the service is deemed to be effective on the next day that is not a Saturday, Sunday, or public holiday. Subsection 95(6) indicates that this deemed service date does not apply if the person to whom the documents were faxed or emailed establishes that the service was not effective at the time set out above due to an absence, accident, illness or cause beyond the person's control.
For example, assume a document is served via email attachment and the email is transmitted at 5:10 p.m. on a Wednesday evening. The document will be deemed to have been served the following day, Thursday, unless that day happens to be a public holiday or if the recipient establishes the service was not effective due to one of the reasons set out in s. 95(6).
This provision was introduced by the Employment Standards Amendment Act (Temporary Help Agencies), 2009 which came into force on November 6, 2009.
Where a document is served in accordance with s. 95(1)(e) via courier, the service of the document is deemed effective two days after courier takes the document unless the person to whom the document is sent establishes that the service was not, in fact, effective at that time due to an absence, accident or illness or cause beyond the person's control.
Reference can be made to the Legislation Act, 2006 when interpreting the timing portion of this subsection. Section 89(3) of that Act states:
This means that when determining the deemed service date, the day the document is provided to the courier will not be counted, but the following calendar days are counted. For example, assume a document is given to the courier on a Monday. The service would be effective on the following Wednesday. It is possible that a deemed service date could fall on a weekend or public holiday.
Subject to s. 95(6), the deemed service date applies regardless of when the document actually arrived by courier.
This provision was introduced by the Employment Standards Amendment Act (Temporary Help Agencies), 2009.
If service under s. 95(1) is attempted or effected by verifiable mail, fax, email, or courier, the deemed service provisions in subsections (3), (4) and (5) do not apply if the person on whom the document is being served establishes that she or he did not, in fact, receive the document in the time period specified in the subsection due to an absence, accident, illness or cause beyond the person's control. The onus of proving the absence, accident, illness or cause beyond the person's control lies with the person refuting the service.
This provision was introduced into s. 95 by the Employment Standards Amendment Act (Temporary Help Agencies), 2009.
If the Director considers another method of service that is not addressed in subsections 95(1) (a) to (f) to be appropriate in the circumstances, the Director may direct the Ontario Labour Relations Board to consider that alternate manner of service.
This provision came into force on November 6, 2009. If the Ontario Labour Relations Board is directed by the Director of Employment Standards to consider a manner of service that is different from those outlined in s. 95(1) clauses (a) to (f), the Board must consider the manner of service put forward and may order that the service be effected in any manner it considers appropriate in the circumstances.
Where the Ontario Labour Relations Board makes an order under s. 95(8) that service be effected in the manner the Board considers appropriate, it must indicate when the service is deemed to be effective.
This provision was introduced by the Employment Standards Amendment Act (Temporary Help Agencies), 2009 and is substantively similar to what were previously ss. 103(7) and 113(4) of the Employment Standards Act, 2000.
Section 95(10) states that there is evidence of the proper issuance, service and receipt of an order or notice where the employment standards officer who issued the order or notice certifies, in a document, that the order or notice was served on the person and states the method of service used. The certificate must be accompanied by a copy of the order or notice that is certified by the officer to be a true copy. The officer is the only person who needs to certify the accuracy of the copy.
Such a certificate is not irrefutable proof of the proper issuance, service and receipt of the order or notice. However, the certificate is acceptable as evidence before a judge or other decision-maker of the proper issuance, service, and receipt of the notice or order, subject to being proven as any other issue of fact before that decision-maker.
Note that s. 95(11) addresses certificates of service relating to documents other than orders or notices.
This provision was introduced by the Employment Standards Amendment Act (Temporary Help Agencies), 2009 which came into force on November 6, 2009.
Section 95(11) states that there is evidence of the proper service and receipt of document under this Act if a certificate is issued by the person who served the document certifying that the document was served and stating the method of service used. The certificate must be accompanied by a copy of the document that is certified by the person who served the document, to be a true copy.
This subsection applies to any "person" who serves a document under this Act. For interpretation of the term "person", please see ESA Part I, s. 1.
Any certificate created per this subsection is not irrefutable proof of service of the document, but is acceptable as evidence before a judge or other decision-maker of service and receipt, subject to a decision-maker making a different finding of fact.
This regulation sets out penalties that are prescribed for notices of contravention issued pursuant to s. 27 of the Employment Protection for Foreign Nationals Act, 2009.
| Item | Contravention | Penalty, in dollars |
|---|---|---|
| 1. | If the notice relates to a contravention of section 14 or 15 of the Act | 250 |
| 2. | If the notice relates to the second contravention of section 14 or 15 of the Act in a three-year period | 500 |
| 3. | If the notice relates to the third or subsequent contravention of section 14 or 15 of the Act in a three-year period | 1,000 |
| 4. | If the notice relates to a contravention of a provision of the Act other than section 14 or 15 | 250 |
| 5. | If the notice relates to the second contravention of a provision of the Act other than section 14 or 15 in a three-year period | 500 |
| 6. | If the notice relates to the third or subsequent contravention of a provision of the Act other than section 14 or 15 in a three-year period | 1,000 |
| 7. | If the notice relates to a contravention of a provision of the Act other than section 14 or 15 and the contravention affects more than one foreign national | 250, multiplied by the number of foreign nationals affected |
| 8. | If the notice relates to the second contravention of a provision of the Act other than section 14 or 15 in a three-year period and the contravention affects more than one foreign national | 500, multiplied by the number of foreign nationals affected |
| 9. | If the notice relates to the third or subsequent contravention of a provision of the Act other than section 14 or 15 in a three-year period and the contravention affects more than one foreign national | 1,000, multiplied by the number of foreign nationals affected |
See the discussion at section 1 of O Reg 289/01 (Penalties and Reciprocal Enforcement) under the Employment Standards Act, 2000 for information about when the penalty amount escalates and when the multiplier is applied. The principles that are set out there also apply in the EPFNA context.
This regulation sets out the exception to the prohibition against cost recovery in s. 8(2) of the Employment Protection for Foreign Nationals Act, 2009.
The intent of the provisions in Part XXII of the Employment Standards Act, 2000 is to establish rules for enforcement. Part XXII sets out the rules regarding the filing of complaints, enforcement by employment standards officers through orders for wages and compensation, as well as the new orders for compliance and notices of contravention introduced in the Employment Standards Act, 2000 and enforcement by arbitrators where there is a collective agreement.
Part XXII also establishes restrictions on the recovery of wages under the Act, settlement procedures and limitation periods on issuing, rescinding and amending orders and notices of contravention.
This provision means that a person filing a complaint with the Ministry of Labour, alleging a violation of the Employment Standards Act, 2000, must file the complaint in a written or electronic form approved by the Director of Employment Standards.
"Person" means not only an individual but also includes a trade union as per ESA Part I, s. 1. It also includes a corporation, by virtue of the definition of person in the Legislation Act, 2006, S.O. 2006, c. 21, Sched. F. As a result, a corporation (e.g., a company seeking information under ESA Part XIX, s. 77(1) as a possible, new building services provider) could file a complaint if the owner/manager of the building failed to provide the prescribed information.
Subsection 41.1.1(6) in Part XI.1 of the ESA (Written Policy on Electronic Monitoring) provides that a complaint can be made only with respect to some of the provisions in Part XI.1. See ss. 41.1.1(6) for information.
The mandatory use of either of the approved forms is reinforced by s. 96(2), which states that complaints that are not in the approved form are deemed not to have been filed. One purpose behind requiring a complaint to be filed on an approved form is to avoid employees filing a complaint in letter form, and thereby unintentionally giving up their rights to sue the employer civilly, pursuant to the election under s. 97 — see ESA Part XXII, s. 97 for a further discussion. Requiring the complaint to be filed on the approved form assists in alerting the employee to the consequences of their election, and eliminates the unintentional loss of civil rights that could arise if the complaint was filed in letter form.
Another purpose of requiring a complaint to be filed on an approved form is to ensure that the limitation period in ss. 114 and 139 will not begin running where the employee visits or writes to the Ministry to inquire about their rights in a particular situation.
Section 96(2) states that if the complaint is not filed in the approved form, then the complaint shall be deemed not to have been filed. There are two main reasons for this:
except when the employee has filed a complaint on the approved form and has had an opportunity to be made aware of the consequences of filing a complaint with the Ministry.
Section 96(3) imposes a two-year limitation period on filing a complaint under the Employment Standards Act, 2000 by stating that a complaint filed more than two years after a contravention has occurred is deemed not to have been filed.
It should be noted that the Program’s position is that the two-year limitation on recovery of monies in ESA Part XXII, s. 111 does not apply to an order for compensation or reinstatement. Program policy continues to be that as the monies owing under a compensation order come due on the date the officer issues the order, they were due after the complaint was filed and the s. 111 limitation would therefore never serve to restrict recovery. In addition, the limitation on recovery set out in s. 111 could have no application to an order for reinstatement because the subject of the order was not monies that came due under the Act. Note that despite the two-year limitation period set out in s. 96(3), it may be possible for the two-year time limit to be extended in exceptional cases. The Court of Appeal decision in Halloran v. Sargeant, 2002 CanLII 45029 (ON CA) held that in the appropriate circumstances, the equitable doctrine of fraudulent concealment applies to relieve against statutory time limits on recovery. See ESA Part XXII, s. 111(8) for a discussion of the Halloran v. Sargeant decision.
The question has arisen as to whether the Limitations Act, 2002, S.O. 2002, c. 24 applies to the Employment Standards Act, 2000. The Limitations Act, 2002 limits the period of time during which a person may initiate court proceedings in Ontario in respect of a claim. In Rand v. Kashruth Council of Canada/Le Conseil Cacherout du Canada, 2016 CanLII 17259 (ON LRB), the claimant sought to bring a claim for reprisal two and half years after the alleged reprisal took place. The claimant argued that ss. 5(1), 5(2) and 16(1) of the Limitations Act, 2002 effectively bi-passes s. 96(3) of the Employment Standards Act, 2000, therefore he was not bound by the two-year limitation period. Section 5(2) of the Limitations Act, 2002 establishes the principle that an individual is presumed to have known of the act(s) or omission(s), that caused damage, on the day they actually occurred, unless the contrary is proved. Section 5(1) sets up the rules applicable to the issue of discoverability. Section 16(1)(a) provides that there is no limitation period if the proceeding is for a declaration if no consequential relief is sought. Here, the claimant argued that the two-year time limit should commence on the date he learned about the alleged reprisal, which was 18 months after the reprisal incident occurred. Furthermore, the claimant argued that no limitation period applied to his claim because he wanted only a declaration that the employer breached the ESA by reprising against him and not any financial remedy (i.e., no consequential relief).
The Board disagreed with the claimant’s arguments and held that the Limitations Act, 2002 is not applicable to the Employment Standards Act, 2000. The Board considered s. 2(1) of the Limitations Act, 2002, which states that the Act applies to claims pursued in court proceedings, and held that proceedings before the Board and an ESO cannot be characterized as a court proceeding. The Board also noted that it does not possess statutory authority to alleviate against the two-year time limit in s. 96(3) by reading in the principles the claimant extracted from the Limitations Act, 2002.
Section 97(1) provides that an employee who files a complaint for unpaid wages or a failure to comply with Part XIII (Benefit Plans) may not launch a civil action in respect of the same matter. This is intended to prevent duplicative proceedings.
Note that it is s. 98 of the Employment Standards Act, 2000 that addresses the situation where an employee who has commenced a civil proceeding subsequently files a complaint. Section 97 addresses the converse situation, i.e., where an employee who has filed a complaint subsequently commences a civil proceeding.
Accordingly, while s. 98(1) provides that an employee who commences a civil proceeding and then files a complaint "may not. . . have such a complaint investigated", s. 98 only applies where the civil proceeding is started before the complaint is filed. Where the complaint is filed first, it is s. 97 that applies, and there is nothing in s. 97 that says that the employee cannot have that complaint investigated. (It may be that in light of s. 97 a court would not allow the civil proceeding to continue, but that is a matter for the court, not the Program.)
Section 97(1) refers to complaints about unpaid "wages". Note that "wages" does not include "compensation" for losses stemming from a contravention of Parts XIV (Leaves of Absence), XVI (Lie Detectors), XVII (Retail Business Establishments) or XVIII (Reprisal) of the Act. (That "wages" and "compensation" are two different things is clear from ss. 103 and 104; an order for the payment of wages is made under s. 103, while an order for the payment of "compensation" is made under s. 104.) Consequently, an employee who files a complaint alleging a violation of Part XIV, XVI, XVII or XVIII is not precluded from pursuing a civil action with respect to the violation.
Subsection 97(1) precludes an employee who has filed an unpaid wages or Part XIII complaint from commencing a civil action for the "same matter". As a result, if an employee was owed both overtime and vacation pay, he or she could not file a complaint with the Ministry for overtime pay and also commence a civil action for vacation pay, as the civil proceedings would be for the "same matter", i.e., unpaid wages.
However, an employee may file a complaint about unpaid wages, e.g., overtime pay, and then commence a civil action for wrongful dismissal, since these proceedings do not involve "the same matter".
Note that the prohibition in s. 97(1) is subject to s. 97(4), which provides for a two-week "cooling off" period in which the employee may withdraw the employment standards complaint and thus avoid losing the right to commence a civil action. See the discussion of s. 97(4) below.
Subsection 97(2) provides that an employee who files a complaint for termination pay or severance pay is not entitled to commence a civil action for wrongful dismissal relating to the same termination or severance of employment as that on which the claim for termination or severance pay was based.
As noted in the discussion of s. 97(1), if the complaint is filed before a civil proceeding is commenced, s. 98 has no application and so there will be no bar to the complaint being investigated by the Ministry.
Note that employees who have filed a claim alleging a violation of Parts XIV (Leaves of Absence), XVI (Lie Detectors, XVII (Retail Business Establishments) or XVIII (Reprisal) for a termination or failure to reinstate are not precluded from commencing a civil action for wrongful dismissal, because a complaint respecting those Parts of the Act is not a complaint alleging an entitlement to termination or severance pay, but rather a complaint asking for reinstatement or compensation or both.
In an action for wrongful dismissal, an employee is seeking damages for the employer’s failure to give notice of termination in accordance with the employment contract. The contractual notice may be based on an express term in the employment contract that spells out how much notice the employee is to receive; however, in the absence of such an express term, the courts imply a term for "reasonable notice" into the contract. What is considered "reasonable notice" is generally much longer than the notice periods under the Act, and awards of damages for wrongful dismissal can be correspondingly greater, in some cases exceeding two years' salary. Note, however, that under the common law employees are said to have a "duty to mitigate", meaning that generally they must attempt to reduce their losses, say by finding or trying to find new employment or other sources of income during the period in which notice, had it been given, would have been running. This duty to mitigate does not apply to notice of termination, termination pay or severance pay under the Act (although in some cases a refusal of alternative employment with the employer will disentitle an employee to notice, termination pay or severance pay). Note also that employees covered by a collective agreement may not sue for wrongful dismissal, since they are generally limited to whatever remedies may be available under the collective agreement.
The purpose of s. 97(2) is the same as the purpose of s. 97(1), that is, to avoid duplicative proceedings. Although termination pay under the Act and damages for wrongful dismissal are based on different wrongs (failure to give notice as required by the Act versus failure to give notice as required by the employment contract), they are overlapping in that they both stem from the employer’s termination of the employment relationship and are based on the employer’s failure to give notice of termination, they often involve similar issues and statutory notice or termination pay that was provided by the employer will reduce the damages that would otherwise be awarded for wrongful dismissal.
Insofar as severance pay is concerned, the purpose of this provision is again the same as the purpose of s. 97(1), that is, to avoid duplicative proceedings. While severance pay under the Act and damages for wrongful dismissal are based on different wrongs (failure to pay severance pay as required by the Act versus failure to give notice as required by the employment contract), they are overlapping to some extent in that they both stem from the employer’s ending of the employment relationship, they often involve similar issues and in at least some circumstances the courts will reduce the damages that would otherwise be awarded for wrongful dismissal by the amount of the employee’s severance pay entitlement — see Stevens v. The Globe and Mail, 1996 CanLII 10215 (ON CA).
An example of a situation in which a civil action for wrongful dismissal may not be considered to relate to the same termination of employment as a termination pay complaint under the Act would be where the employee was dismissed after a year of employment, rehired one month after the dismissal and then laid off two weeks later for more than 13 weeks in circumstances where neither clause 56(2)(b) or (c) were applicable. In that situation, the employee should be able to claim termination pay under the Act in regards to the deemed termination due to a lay-off lasting longer than a temporary lay-off, and also sue the employer civilly for wrongful dismissal based on the earlier dismissal. The two terminations are clearly not the same termination. Note, however, that because the employee’s last period of employment is separated by not more than 13 weeks from the preceding period, the employee’s entitlement to termination pay would be calculated by adding together both the period of employment that ended in the dismissal and the period that ended as a result of the lay-off.
Subsection 97(3) provides that the prohibition in ss. 97(1) and (2) against a complainant commencing a civil action applies even in situations where the amount alleged to be owing in the civil action is greater than the amount for which an order can be issued under the Act. Section 103(4) provides that the maximum amount of wages for which an order can be issued for an employee is $10,000. Thus, where, for example, the employee is owed $18,000 in wages, and files a complaint, the employee will be prohibited from commencing a civil action for the wages, even though the most that the employee will be able to recover on the complaint is $10,000. (Note also that pursuant to clause 97(3)(b), the employee would not be able to commence a civil proceeding in which he or she claimed only the difference ($8,000) between what was recoverable by way of an order ($10,000) and the total amount allegedly owed ($18,000).
Note that while s. 97(3) refers to "the amount for which an order can be issued under this Act" — which if read in isolation could cover orders for compensation issued under s. 104 — the principles of statutory interpretation would require that the subsection be read in context; since s. 97 as a whole is clearly concerned with complaints about unpaid wages and not with complaints alleging a violation of a part of the Act for which a compensation order could be issued, s. 97(3) should not be construed as prohibiting civil actions based on such a violation where a complaint about the violation has been filed.
This provision provides a two-week "cooling off" period in which the employee can withdraw a complaint and thereby restore the ability to commence a civil action. This two-week period could be used by a complainant employee to consult a lawyer for advice on whether a civil action might be his or her better option in the circumstances. Note that s. 97(4) does not require that the withdrawal be in writing; however, putting it in writing it may lessen the likelihood of dispute.
Although there is nothing in the Employment Standards Act, 2000 that provides for an extension of the two-week time limit, courts have inherent jurisdiction to extend limitation periods. For an example of a case where the two-week period in s. 97(4) was extended, see Scarlett v. Wolfe Transmission Ltd., 2002 CanLII 53229 (ON SC).
This provision prohibits an employee from filing a complaint about unpaid wages or a failure to comply with Part XIII where the employee has commenced a civil proceeding seeking a remedy for the same matter. This section mirrors the wording of s. 97(1), which deals with the converse prohibition, i.e., the barring of an employee from commencing a civil action where the employee has filed a complaint with the Ministry under the Employment Standards Act, 2000.
At the Small Claims Court level, a proceeding is commenced by filing a claim (with two copies for each defendant) with the clerk of the Small Claims Court. After obtaining payment of the court fees, the clerk dates, signs and seals the claim and assigns it a court file number. It is only once this has happened that the action is considered to have been commenced.
At the Superior Court of Justice (formerly General Division) level, a proceeding is commenced by the court Registrar’s act of dating, signing, sealing and assigning a court file number to an "originating process" prepared by the plaintiff. Examples of an originating process include a Statement of Claim and a Notice of Action.
At the Superior Court of Justice in Toronto, lawyers can also commence proceedings electronically where necessary arrangements have been made with court officials.
Under the Rules of Civil Procedure, R.R.O. 1990, Reg. 194, civil proceedings may also be commenced by a counterclaim, cross claim, third-party claim or judicial review application.
Note that s. 97 of the Act addresses the situation where an employee who has filed a complaint subsequently commences a civil proceeding, whereas s. 98 addresses the converse situation, i.e., where an employee who has commenced a civil proceeding subsequently files a complaint.
Accordingly, while s. 98(1) provides that an employee who commences a civil proceeding "may not. . .have such a complaint investigated", this does not prevent or terminate an investigation of a complaint where the employee commences a civil proceeding after filing a complaint; s. 98 applies only to prohibit a complaint from being filed or investigated if a civil proceeding was commenced before the complaint was filed.
This provision prohibits an employee from filing a complaint for termination or severance pay where the employee has commenced a civil proceeding for wrongful dismissal relating to the same termination or severance of employment. This section mirrors the wording of s. 97(2), which deals with the converse proposition, i.e., the barring of an employee from commencing a civil proceeding for wrongful dismissal where the employee has filed a complaint under the Act with the Ministry.
Note that s. 97 of the Act addresses the situation where an employee who has filed a complaint subsequently commences a civil proceeding, whereas s. 98 addresses the converse situation, i.e., where an employee who has commenced a civil proceeding subsequently files a complaint. Thus it is s. 97, not s. 98, that applies where the complaint is filed first.
Accordingly, while s. 98(2) provides that an employee who commences a civil proceeding "may not. . .have such a complaint investigated", this does not prevent or terminate an investigation of a complaint where the employee commences a civil proceeding after filing a complaint.
The election of remedies provisions in ss. 97 and 98 eliminate the possibility of issue estoppel arising as in Rasanen v. Rosemount Instruments Ltd., 1994 CanLII 608 (ON CA), where the employee lost on an issue before a referee under the Act and was later estopped from relitigating that issue in court in a wrongful dismissal action involving much more money than the employment standards matter.
This provision effectively deems the Employment Standards Act, 2000 to be part of the collective agreement, and makes it enforceable against the employer, as if it were part of the collective agreement, if the contravention of or failure to comply with the Act occurs:
It is obligatory for the arbitrator or board of arbitration to apply the Employment Standards Act, 2000 as if it were actually part of the collective agreement, if the alleged contravention of the Act occurs during one of the following three periods:
A collective agreement is normally in force during its term, which may be as long as several years, but which may not be shorter than one year in length. If the alleged contravention of or failure to comply with the Act occurs while the collective agreement was or is in force, the Employment Standards Act, 2000 is deemed to be part of the agreement and is enforceable against the employer as if it were part of the agreement, i.e., through the grievance procedure. Ultimately, if the grievance is not resolved, it would be heard by an arbitrator or a board of arbitration, which would then release a decision which is enforceable in the same manner as an order or judgment of the court.
The collective agreement may cease to be in force prior to the end of its term under some circumstances, such as where the employer and the union jointly agree to terminate it and the Ontario Labour Relations Board consents, or if the union is decertified (i.e., if the Board declares that the union no longer represents the employees in the bargaining unit). In that event, the employee may file an employment standards complaint with the Ministry for investigation and enforcement.
Section 58(2) of the LRA 1995 provides that the collective agreement may be extended by the parties for a period of up to one year while the parties are bargaining. Section 58(2) of the LRA 1995 states:
If the alleged contravention of the Employment Standards Act, 2000 occurs or occurred during this bridging period in which the operation of the collective agreement is extended for up to one year, the Act would effectively be deemed to form part of the collective agreement and would be enforceable against the employer as if it were actually part of the collective agreement, i.e., through the grievance procedure and subsequently through arbitration, if that becomes necessary.
Section 86(1) of the LRA 1995 provides that where the employer or the union has given notice to the other party of its desire to bargain for a collective agreement, and no collective agreement is in operation, the employer and the union are prohibited from changing the terms and conditions of employment, except with the consent of both parties. The period of this prohibition, sometimes referred to as the statutory freeze, continues until the earlier of two dates:
If an employer is or has been bound by a collective agreement, the Act is enforceable against the employer as if it were part of the collective agreement in respect of an alleged contravention of the Employment Standards Act, 2000 that occurs or occurred during the statutory freeze period, using the grievance procedure. Note, however, that where the union representing an employee has not yet made a first collective agreement with the employer, the matter would not fall within s. 99(1), which only applies where "an employer is or has been bound by a collective agreement". Thus, even though the statutory freeze provided for in s. 86(1) of the LRA 1995 may be in effect, if there has never been a collective agreement between the union and the employer, an employee represented by the union could file a complaint with the Ministry as of right, i.e., the employee does not need to obtain the permission of the Director under s. 99(6).
Section 99(2) means that an employee who is covered by a collective agreement will not be able to file a complaint with the Ministry under the Act. In this regard, see the Board’s decision in Johnston v. Brian Cullen Motors, 2004 CanLII 25855 (ON LRB) where the Board confirmed that it had no jurisdiction to hear the appeal of the claimant on the basis that he was prohibited by s. 99(2) from filing a complaint alleging a contravention of the Act because he was represented by a union, which was party to a collective agreement. See also Tender Choice Foods Inc. v. Bolivong, 2004 CanLII 22611 (ON LRB) in which the Board held that the claimant was precluded from filing a complaint under the Act despite her understanding when she filed her claim that she was not in a bargaining unit position or represented by the union. The employer’s evidence, which was not contradicted, was that the claimant had in fact been represented by a trade union bound to a collective agreement at the time of the alleged contravention. The Board noted that the employment standards officer was therefore also precluded from issuing a Notice of Contravention in connection with the complaint.
Section 99(2) should be read together with s. 99(4), which states that s. 99(2) applies even if the employee is not a member of the trade union. It will also apply to probationary employees as they are covered by collective agreements although admittedly they may have fewer protections under the agreement than permanent employees. Section 99(2) is also subject to s. 99(6), which says that the Director may, if they consider it appropriate in the circumstances, allow an employee to file a complaint with the Ministry even though the employee is represented by a trade union that was a party to a collective agreement.
A question that arises is whether the employee is permitted to file a claim for a violation that occurs in two situations: after the statutory freeze period in s. 86(1) of the LRA 1995 has expired but no legal strike or lock-out has begun; or during a legal strike or lock-out.
After the statutory freeze period has expired but the parties have not engaged in either a legal strike or lock-out, the collective agreement is not in force and its operation has not been continued under s. 58(2) of the LRA 1995.
During a legal strike or lock-out, the collective agreement is not in force, its operation has not been continued under s. 58(2) of the LRA 1995 and the statutory freeze period in s. 86(1) of the LRA 1995 has expired.
Consequently, in both situations the provisions of s. 99(1), which make the Act enforceable against the employer as if it were part of the collective agreement in certain situations, do not apply, i.e., employees who are on lawful strike or are being lawfully locked-out cannot have their Employment Standards Act, 2000 rights enforced through the grievance and arbitration procedure.
Therefore, it is Program policy that in these circumstances bargaining unit employees are entitled to file a claim under the Employment Standards Act, 2000 for contraventions or failures to comply with the Employment Standards Act, 2000 that occurred during the lawful strike or lock-out. This is also the case if a legal strike or lock-out ends and the workplace is shut down without the parties entering into a new collective agreement. Note, however, that employees' eligibility to termination and severance pay may be affected if the termination occurs during or as a result of a strike or lock-out. See O. Reg. 288/01 for further discussion of the impact of a strike or lock-out on rights to termination and severance pay.
A further issue involves the building services sector and situations where the employees of the previous employer were unionized and there was a collective agreement in place. If the successor does not employ the employees of the previous employer and is not exempted from its Part XIX (Building Services Providers) obligations by O. Reg. 287/01, the employees are entitled to file a complaint against the successor. This is because the collective agreement does not follow through to bind the successor employer under the LRA 1995 and so cannot be used by employees to enforce their Employment Standards Act, 2000 rights against the successor. Note, however, that the claim against the successor must be for something that the successor — not the previous employer — is liable for, for example, termination and severance pay. If the complaint relates to something owed by the previous employer, the claim can be enforced against the previous employer through the grievance procedure even though the employees are now employed by the successor.
Another question that has arisen is whether bargaining unit employees are entitled to file a complaint with the Ministry where the expiry date of the collective agreement has not passed, but the workplace has shut down and the union and company agreed prior to the closing to terminate the collective agreement upon the closing.
It is Program policy that the bargaining unit employees in this situation are prohibited under s. 99(2) from filing a complaint or having such a complaint investigated by the Ministry. This is because unions and employers cannot simply agree between themselves to terminate a collective agreement upon a plant closing. Section 58(3) of the LRA 1995 requires the union and employer to jointly apply for and receive the consent of the Ontario Labour Relations Board before a collective agreement can be terminated early. If an application for an early termination of the agreement has not been made and granted by the Board, the collective agreement remains in existence, and the union continues to have a duty to represent employees despite the plant closure. See s. 99(6) below for more on this issue.
Another point to note is that s. 99(2) indicates that the employee is prohibited from filing or having such a complaint investigated by the Ministry under the Employment Standards Act, 2000. It is clear what the prohibition against filing a claim under the Act involves. The reference to such a complaint is a reference to a complaint enforceable against the employer as if the Act were part of the collective agreement under s. 99(1). In order for a complaint to be enforceable under s. 99(1), the employer must be bound by the agreement and the alleged contravention must occur when the collective agreement was or is in force; when its operation is continued under s. 58(2) of the LRA 1995; or during a statutory freeze period under s. 86(1) of the LRA 1995. As a result, an employee who filed a complaint prior to a collective agreement coming into force would be able to have such a complaint investigated by an employment standards officer.
If an employee alleged that a contravention of the Act occurred prior to when the agreement came into effect, they would be allowed to file a complaint under the Act. However, if it subsequently came to light that the contravention occurred after the agreement came into effect, the Ministry would not investigate or would cease investigating the complaint.
Another example could occur where an employee’s position was not subject to a collective agreement because their position was not considered to be in the bargaining unit at the time they filed the complaint. If the Ontario Labour Relations Board subsequently ruled that the employee’s position actually was in the bargaining unit, the Ministry would not investigate or would cease investigating the complaint.
Section 99(3) provides that an employee to whom a collective agreement applies is bound by the decision of the union on the issue of whether or not to proceed with the employee’s grievance, or any other decision of the union with regards to the issue of the enforcement of the Act under the collective agreement, such as what remedies to seek in the grievance, or what arguments to make or evidence to adduce during an arbitration if the grievance reaches that stage. It should be read together with s. 99(4), which states that s. 99(2) applies even if the employee is not a member of the trade union.
This section should also be read together with s. 99(5), which indicates that an employee retains the right to make an unfair representation complaint against the union under s. 74 of the LRA 1995.
Section 99(4) provides that an employee cannot file a complaint with the Ministry or have such a complaint investigated as per s. 99(2) and is bound by the decision of the trade union as per s. 99(3) even if the employee is not a member of the trade union.
For example, employees in workplaces that have an agency shop arrangement between the union and employer do not have to be union members in order to work there (although they do pay union dues), but they will be represented by the union. Consequently they cannot file a complaint with the Ministry nor can they have the complaint investigated, and are bound by the union’s decision with respect to the enforcement of the Employment Standards Act, 2000 under the collective agreement. Other examples of employees who are not members of the trade union may include a probationary employee who is not required to pay union dues and an employee who has exercised their right under the LRA 1995 to make a charitable donation instead of paying union dues or decline to be a member of the union for religious reasons. Although such employees are not paying dues to the union and may not be a member of the union, they are covered under the collective agreement and would be represented by the trade union with regard to a violation of the collective agreement, and likewise the Employment Standards Act, 2000.
Section 99(5) means that, although an employee is bound under s. 99(3) by the decision of the union with regards to the employee’s grievance (whether they are a member of the trade union as per s. 99(4)), including the decision not to proceed with it, the employee still has the right to file a complaint against the union for unfair representation under s. 74 of the LRA 1995. That section states:
Section 99(6) provides the Director of Employment Standards with the discretion to allow an employee who is otherwise caught by the prohibition under s. 99(2) to file a complaint or have such a complaint investigated under the Act. Please see Delegation of Powers for information regarding the persons to whom this power has been delegated.
Although the discretion of the Director and delegates is absolute in this area, the following are some examples of situations in which it might be appropriate to exercise the discretion in s. 99(6) to allow an employee to file or have such a complaint investigated by the Ministry under the Act:
The employee makes an unfair representation complaint against the union under s. 74 of the LRA 1995. The employee wins the unfair representation case against the union, but in the meantime, the union has become defunct and is unable to proceed with the grievance.
The union believes that the employee is in the bargaining unit, but the employer does not. The matter is referred to the Labour Relations Board, but it will not be able to render a decision before the two-year recovery period for wages owing under the Employment Standards Act, 2000 expires. In such a case, even if the Employment Standards Program is of the preliminary view (pending the Board’s decision) that the employee is a member of the bargaining unit, it may be appropriate to exercise the discretion in s. 99(6) to allow the employee to file a claim under the Act. Otherwise, if it is later determined by the Board that the employee is not in the bargaining unit, the employee would be left without any remedy under either the Act or the collective agreement.
Section 100(1) indicates that if the employee’s grievance reaches the arbitration stage, the arbitrator can make the same orders that an employment standards officer could make under the Employment Standards Act, 2000 with the exception of a notice of contravention. “Arbitrator” is defined in Employment Standards Act Part I, s. 1 to include a board of arbitration, or the Ontario Labour Relations Board acting as an arbitrator of a construction industry grievance under s. 133 of the Labour Relations Act, 1995, S.O. 1995, c. 1, Sched. A.
Under s. 100(1) the orders an arbitrator can make are:
Subsection 100(2) states that where the arbitrator finds that the employer has contravened Part XIII Benefit Plans, the arbitrator may make an order that the Board can make under ESA Part XXIII, s. 121. In other words, where the arbitrator determines that the employer, organization or person acting directly on behalf of an employer or organization has contravened Part XIII (i.e., differentiated on the basis of age, sex, marital status or same-sex partnership status in an employee benefit plan) the arbitrator may:
Please see ESA Part XXII, s. 113(3) for a discussion of the Board’s order making powers where it finds a contravention of ESA Part XIII Benefit Plans.
Subsection 100(3) states that an order made by an arbitrator against a corporate director shall not require the director to pay any amount or to take or refrain from taking any action that the director could not be ordered to pay or to take or refrain from taking under the Employment Standards Act, 2000 without reference to the collective agreement.
The ability of an arbitrator to impose liability on a director was intended to enable the director’s liability provisions of the Employment Standards Act, 2000 to be used to assist in the enforcement of rights under the Act, not rights under the collective agreement.
Paragraph 1 of s. 100(4) explicitly provides that the arbitrator’s order for wages or compensation may require payment to be made directly to the trade union representing the employees or directly to the employees. Because the payment is not made to the Director, the arbitrator’s order will not incorporate the 10% administrative costs surcharge, because the surcharge on orders to pay attaches only to payments made to the Director of Employment Standards in trust.
Paragraph 2 provides that the arbitrator’s order is not subject to any limitation on orders in ESA Part XXII, s. 103(4).
Paragraph 3 indicates that the arbitrator’s decision under s. 100 is not subject to review by the Ontario Labour Relations Board under ESA Part XXIII, s. 116. The remedy of a party dissatisfied with the decision of the arbitrator would be to seek judicial review. Normally, a decision of an arbitrator that interprets the Act would be subject to the strict correctness test on judicial review, on the basis that the arbitrator was construing a statute outside of their area of special expertise; see McLeod v. Egan, [1975] 1 SCR 517, 1974 CanLII 12 (SCC). However, because ESA Part XXII, s. 99(1) deems the Employment Standards Act, 2000 to form part of the collective agreement, it is at least arguable that the decision of an arbitrator interpreting the Employment Standards Act, 2000 is thus now in effect merely a construction of the collective agreement itself, rather than an interpretation of a statute outside the collective agreement, and therefore the more deferential reasonableness test should apply on judicial review. It remains, though, to be seen how the courts will rule on this issue.
Section 101(1) states that s. 101 of the Employment Standards Act, 2000 applies if, during an arbitration concerning enforcement of the Employment Standards Act, 2000 under ESA Part XXII, s. 100 (other than an arbitration that is conducted by the Ontario Labour Relations Board), an issue arises as to whether the employer that is the subject of the grievance and another entity are one employer under ESA Part III, s. 4. Section 101 will apply if the related employer issue under s. 4 arises during the arbitration, regardless of whether it was raised in the initial grievance that led to the arbitration.
ESA Part III, s. 4 states:
Section 4 means that two entities shall be treated as one employer for purposes of the ESA Part III, s. 4 if they meet the requirements set out in that section.
Section 101(2) states that the arbitrator shall not make any decision regarding the issue of whether the employer against whom the grievance was filed and the other entity are one employer under ESA Part III, s. 4. Instead, that decision is to be made by the Ontario Labour Relations Board.
Section 101(3) requires the arbitrator to notify the Ontario Labour Relations Board that an issue under ESA Part III, s. 4 has arisen during the arbitration, unless the arbitrator determines that there was no violation of the Employment Standards Act, 2000 in any event. In other words, if, for example, the arbitrator determines that there is no money owing to the employees under the Employment Standards Act, 2000, the arbitrator would not notify the Board of the related employer issue under s. 4, since that issue would be an academic point.
One question that arises is whether this provision means that the arbitrator should first make a determination as to what amount, if any, is owing to the employees under the Employment Standards Act, 2000, before notifying the Board of the related employer issue. Since s. 101(3) does not specify that the arbitrator must notify the Board immediately, it would, if no determination as to amount had been made before the related employer issue under s. 4 first arose, seem to be within the discretion of the arbitrator either to notify the Board immediately of the related employer issue under s. 4, or to wait until it is clear that some monies are owing to the employees under the Act. In some instances it may be impossible to determine whether any monies are owing to the employee under the Act until the related employer issue under s. 4 has first been decided. For example, because ESA Part XV, s. 64(1)(b) states that severance pay is only payable in individual terminations where the employer has an annual payroll of $2.5 million or more, the issue of whether two employers, A and B, each with a payroll of $2 million, are one employer under s. 4 must be determined before a finding that severance pay is owing can be made. In this type of situation, one route the arbitrator could take would be to make a conditional finding of the amounts owing to the employees (i.e., conditional on s. 4 being applicable) and to notify the Board of the related employer issue under s. 4 either before or after such a conditional finding is made.
Section 101(4) states that the arbitrator’s notice to the Board shall state that a related employer issue under ESA Part III, s. 4 has arisen and shall advise the Board of any decisions concerning the other matters in dispute, e.g., whether the employees are owed money under the Employment Standards Act, 2000 . However, as stated in the discussion of s. 101(3), the arbitrator has the discretion to notify the Board of the s. 4 issue before it reaches a decision on the non-s. 4 issues.
Section 101(5) states that the Board shall make a determination with respect to whether the employer and the other person are related under ESA Part III, s. 4, but may not vary any decision of the arbitrator concerning the other matters in dispute. This section must be read together with ss. 101(6), (7) and (8), which set out the rules regarding the Board’s ability to issue an order against both the employer and any other person it has determined to be related to the employer.
Section 101(6) provides that the where there has been a ESA Part III, s. 4 reference to the Board, the Board can make an order against the employer as well as any person that is found to be a related employer under s. 4. This section should be read in conjunction with ss. 101(7) and (8), which qualify the Board’s power to make the order.
Section 101(7) means that where an arbitrator has referred a related employer issue under ESA Part III, s. 4 to the Board, the Board’s order against any person found to be related pursuant to s. 4 to the unionized employer is limited to amounts or actions (including refraining from such actions) that could be ordered under the Employment Standards Act, 2000 in the absence of the collective agreement. The ability of an arbitrator to rely on the Act’s related employer provision via a reference to the Board was intended to enable that provision to be used to assist in the enforcement of rights under the Employment Standards Act, 2000, not rights under the collective agreement.
Section 101(8) provides that ESA Part XXII, s. 100 applies with necessary modifications to an order made by the Board when an ESA Part III, s. 4 issue has been referred to the Board by an arbitrator under s. 101(3). Section 100 deals with the order making powers of arbitrators who are determining a grievance alleging a contravention of the Employment Standards Act, 2000.
Subsection 101.1(1) allows an employment standards officer who has been assigned to investigate an employment standards complaint to attempt to effect a settlement between an employer and an employee as the parties to the complaint. While the officer may attempt to effect a settlement, this provision does not require the employee and employer to enter into settlement discussions; the settlement process is voluntary.
Note that s. 101.1 as well as s. 112 (and unlike ss. 120 and 129) apply only to settlements between an employer and an employee and so cannot be used to settle a complaint that relates to the liability of a corporate director or a director’s order issued under s. 106 or s. 107.
However, it should be noted that for the purposes of both s. 101.1 and s. 112 settlements in respect of Part XVIII.1, that a reference to an employer includes a reference to a client of a temporary help agency and a reference to an employee includes a reference to an assignment employee or prospective assignment employee. (See s. 112(9) and s. 101.1(3) of the Employment Standards Act, 2000 and of this Manual.)
Note as well that a settlement agreement may be made by an agent acting on behalf of the employer (e.g., a director of a corporate employer) or the employee. As a result, a director of the employer could, if acting as agent for the employer, enter into a settlement under s. 101.1 of a complaint against, or corporate order issued to, an employer. In that case, any proceedings against both the employer and the corporate director (other than a prosecution) would be terminated under s. 101.1(2)(d). (And see section 7.6.1 of this Manual for a discussion of the binding effect of an agreement or authorization made by an agent of the employee.)
The other provisions of the Employment Standards Act, 2000 that allow for settlement agreements between the parties to an employment standards complaint are as follows:
However, s. 101.1 is distinguished from the above provisions in that it provides the employment standards officer who has been assigned to investigate a complaint with the authority to attempt to effect a settlement of that complaint.
If the employer and employee agree to enter into a settlement under s. 101.1, the agreement becomes binding on the parties, any complaint filed with the ministry is deemed to have been withdrawn, any investigation into the complaint that may have been underway is terminated, and any proceeding other than a prosecution is terminated. (Note that such an agreement must be in writing pursuant to s. 1(3) of the Act.)
Section 101.1(2) must be read subject to subsection (4), which provides that where an employee or employer enters into a settlement as a result of fraud or coercion, the settlement is void.
It should also be noted that the binding effect of the settlement and its impact on a complaint, an order, or a proceeding is dependent on the parties to the settlement doing what they have agreed to do under it. For example, if the employer and employee have settled the matter with the agreement that a specific sum of money will be paid to the employee and such monies are not paid, this section will not apply and the matter will proceed as if there had been no settlement.
While s. 101.1 does not impose any specific restrictions with respect to when an employment standards officer may facilitate an agreement, the fact that this section provides for termination of the officer’s investigation, rather than the voiding of an officer’s orders as in s. 112, implies that any settlement by an officer under s. 101.1 must occur before the officer makes a determination. A "post-order" settlement could be made without the officer’s involvement under s. 112, and such a settlement would, in accordance with s. 112(c), void the officer’s order.
This provision provides that subsections (4), (5), (7), and (9) of section 112 apply, with necessary modifications, in respect of settlements effected by employment standards officers under s. 101.1.
In this context, the application of s. 112(4) means that monies received by an employment standards officer pursuant to a settlement under s. 101.1 must be paid either directly to the employee or to the Director of Employment Standards in trust for the employee.
The application of s. 112(5) means that where monies received by an employment standards officer pursuant to a s. 101.1 settlement are paid to the Director in trust for an employee, the Director is required in turn to pay the monies to the employee.
The application of s. 112(7) means that the parties are prohibited from entering into a settlement that would allow future contraventions of the Act. For example, although an employee could agree to accept a payment equivalent to straight pay for overtime hours worked in the past, the employee would be prohibited from agreeing to work overtime in the future at straight time.
The application of s. 112(9) means that for the purposes of applying s. 101.1 with respect to Part XVIII.1 of the Act (Temporary Help Agencies), any reference to an "employer" includes a reference to a client of a temporary help agency and any reference to an "employee" includes a reference to an assignment employee or a prospective assignment employee.
Subsection 101.1(4) provides that a settlement may be set aside where the employee or employer can demonstrate to the Ontario Labour Relations Board that he or she or it entered into the settlement as a result of fraud or coercion. If the Board makes such a finding, the settlement is void, the employee’s complaint is deemed never to have been withdrawn, the investigation of the complaint is resumed, and any proceeding relating to the alleged contravention that was terminated is resumed.
This provision gives an employment standards officer the authority to require listed persons to attend a meeting where the officer is investigating a complaint against an employer or where the officer, while conducting an inspection under s. 91 or 92, comes to have reasonable grounds to believe that an employer contravened the legislation with respect to an employee.
Section 102 was amended by the Employment Protection for Foreign Nationals Act (Live-in Caregivers and Others), 2009, S.O. 2009, c. 32 (amended and renamed the Employment Protection for Foreign Nationals Act, 2009 effective November 20, 2015) with the addition of paragraphs 3 and 4. Pursuant to paragraph 3, an employment standards officer may compel parties to attend a meeting in the event information is acquired that suggests the possibility of a violation of the Employment Standards Act, 2000. In other words, it is no longer necessary for the officer to be investigating a complaint or to have reasonable grounds to believe an employer has contravened the Act or regulations in order to schedule a meeting under s. 102; information acquired by the officer that merely suggests the possibility of a contravention will be sufficient.
Pursuant to paragraph 4, an employment standards officer may also compel parties to attend a meeting where the officer wishes to determine whether an employer of a live-in employee is complying with the Employment Standards Act, 2000. In effect, this enables an officer to do a "pro-active" inspection in the case of live-in employees by requiring the parties to attend a meeting so that the officer may determine whether the employer of a "live-in" employee is complying with the Act. The officer may schedule such a meeting even if no complaint is being investigated and even if there is no information to suggest or reasonable grounds to believe that the employer (of a live-in employee) is contravening the Act or regulations.
This subsection provides that the officer must give at least 15 days written notice of the meeting.
Please note that s. 74.13 of the Act modifies s. 102 when it is applied with respect to Part XVIII.1 (Temporary Help Agencies) of the Act. That section expands the circumstances under which attendance at a meeting may be required, to include: an officer is investigating a complaint against a client of a temporary help agency or, is conducting an inspection and has reasonable grounds to believe that a client has contravened the Act or regulations with respect to an assignment employee. See section ESA Part XVIII.1, s. 74.13 for more information.
The language of s. 102 is permissive as far as the employment standards officer is concerned. The officer may require that the following persons attend the meeting:
This puts s. 102 on the same footing as the other powers of the officer to investigate under s. 91 and to issue orders and notices of contravention under ss. 74.14, 74.16, 74.17, 103, 104, 106, 107, 108 and 113. The officer is not required by the legislation to hold s. 102 meetings in preference to other methods of resolving claims or conducting an inspection.
The Statutory Powers Procedure Act, R.S.O. 1990, c. S.22 does not apply to meetings convened under s. 102, although the rules of natural justice do apply (as they do to any other aspect of the investigation process).
This section describes those persons that may be required to attend a meeting held under s. 102. The attendees listed in s. 102(2) are the same as those described in s. 64.2(1) of the former Employment Standards Act. Note that an officer of the corporation is no longer itemized, as the definition of employee in the Employment Standards Act, 2000 includes officers (who perform work for an employer for wages).
Please note that where s. 102 is applied in respect of Part XVIII.1 (Temporary Help Agencies), s. 71.13 expands the list of persons that may be required to attend a meeting. Please see ESA Part XVIII.1, s. 74.13 for more information.
This provision was amended by the Employment Standards Amendment Act (Temporary Help Agencies), 2009, S.O. 2009, c. 32, which came into force on November 6, 2009 and is similar to the previous s. 102(4) of the Act.
Section 102(3) establishes that the written notice provided by an employment standards officer requiring attendance at a decision-making meeting must set out the time and place of the meeting and must be served in accordance with s. 95 of the Act. Please see ESA Part XXI, s. 95 for a discussion of the service provisions under s. 95.
This provision was amended by the Employment Standards Amendment Act (Temporary Help Agencies), 2009 which came into force on November 6, 2009 and is similar to the previous s. 102(3) of the Act.
Section 102(4) allows an employment standards officer to require that a meeting attendee bring to the meeting, or make available for the meeting, any records or other documents specified in the notice of the meeting. This provision must be read in conjunction with s. 102(5) that indicates an officer may give directions on how the documents are to be made available for the meeting.
This provision was introduced by the Employment Standards Amendment Act (Temporary Help Agencies), 2009. It indicates that an employment standards officer may give direction to meeting attendees on specific ways in which documents or records are to be made available for the meeting. The officer may require that documents be sent by fax, email, courier, etc. to all parties and to the officer in advance of the meeting.
For example, if an employment standards officer directs that a decision-making meeting is to take place via teleconference, he or she could require that relevant documents be sent via email to the parties in advance of the meeting for their reference during the meeting.
This provision is substantially the same as the corresponding section (s. 64.2(5)) of the former Employment Standards Act.
Section 102(6) requires a person who receives a notice of meeting to comply with the notice. This includes attending the meeting at the specified time and place and bringing or making available for the meeting any records or other documents specified in the notice, in accordance with any direction from the officer with respect to how the records or documents are to be made available.
This provision was introduced by the Employment Standards Amendment Act (Temporary Help Agencies), 2009 which came into force on November 6, 2009. It allows for the use of technology to facilitate s. 102 meetings. An employment standards officer may direct a meeting to be held using technology that allows attendees to participate in the meeting concurrently. This may include, but is not limited to, holding the meeting via teleconference or videoconference.
This provision was introduced by the Employment Standards Amendment Act (Temporary Help Agencies), 2009, which came into force on November 6, 2009. When an employment standards officer directs that a meeting be held using a technology (such as a teleconference or videoconference), he or she must include in the written notice of the meeting any information, in addition to the time and place at which the person is to attend, that he or she considers appropriate.
For example, if a decision-making meeting is to be held via videoconference, the employment standards officer may consider it appropriate to provide information about the type of technology that will be used, how the person will be set-up with the technology, any call-in numbers or codes that may be necessary, etc.
This provision was introduced by the Employment Standards Amendment Act (Temporary Help Agencies), 2009 which came into force on November 6, 2009. Where an employment standards officer directs that a meeting be held using technology, such as teleconferencing or videoconferencing, and the person participates in the meeting using that technology, the person will have attended the meeting for the purposes of s. 102.
Subsection 102(10) was added by the Open for Business Act, 2010, S.O. 2010, c. 16, effective November 29, 2010. It provides that where a person who has been served with a notice under s. 102 requiring him or her to attend a meeting or to attend a meeting and bring or make available certain documents does not attend the meeting or does not bring or make available the documents, the employment standards officer can make a determination about the employer’s compliance with the ESA without entertaining any further evidence or submissions from that person.
If it is the employer who failed to comply with the notice, the officer may make a determination based on any evidence or submissions provided by or on behalf of the employer before the meeting, any evidence or submissions provided by or on behalf of the employee before or during the meeting, and any other factors the officer considers relevant.
If it is the employee who failed to comply with the notice, the officer may make a determination based on any evidence or submissions provided by or on behalf of the employee before the meeting, any evidence or submissions provided by or on behalf of the employer before or during the meeting, and any other factors the officer considers relevant.
Note that section 74.13 of the Act modifies the application of s. 102 when it is applied in respect to Part XVIII.1 of the Act (Temporary Help Agencies). See ESA Part XVIII.1, s. 74.13 for more information.
Subsection 102(11) was added by the Open for Business Act, 2010, effective November 29, 2010. This provision provides that where the employer is a corporation, the reference to an employer in s. 102(10) includes an employee or a director of the corporation who was served with a notice under s. 102 requiring him or her to attend a meeting or to bring or make certain documents available to the employment standards officer.
In other words, a director or an employee of a corporation who is served with a notice under s. 102 requiring attendance at a meeting or requiring the provision of certain documents must abide by the notice. If he or she fails to comply with the notice, an employment standards officer may make a determination as to whether the employer corporation has contravened or is contravening the Act in accordance with s. 102(10).
Section 102.1 is a new section added by the Open for Business Act, 2010, S.O. 2010, c. 16, effective November 29, 2010. This provision gives an employment standards officer authority to issue a notice requiring an employee or employer to provide evidence or submissions within a time period specified in the notice.
The circumstances, in which such a notice can be issued are:
Note that s. 102.1 applies with certain modifications in the context of temporary help agencies and their assignment employees. See ESA Part XVIII.1, s. 74.13 for more information.
This provision requires that the notice to provide evidence or submissions be served on the employer or employee, as the case may be, in accordance with s. 95 of the Employment Standards Act, 2000. Please see ESA Part XXI, s. 95 for a discussion of the service provisions under s. 95.
Section 102.1(3) provides that where an employment standards officer gives notice to provide evidence or submissions within a specified time period and a party fails to comply with the notice, the officer may make a decision on the basis of:
In other words, if one of the parties fails to comply with the notice, the officer may make his or her determination without entertaining any further evidence or submissions from that party.
Sections 103(1) to (10) deal exclusively with orders for wages under the Employment Standards Act, 2000.
Section 103(1)(a) states that where the officer finds wages are owing, they may arrange for the employer to pay the employee(s) directly, without an order being issued.
Section 103(1)(a.1) states that where the officer finds wages owing, the officer may issue an order requiring the employer to pay wages to the employee directly. Note that an order to pay wages issued under clause (a.1) does not include administrative costs.
Section 103(1)(b) states that where the officer finds wages are owing, the officer may issue an order to the employer to pay the wages owing to the employee to the Director of Employment Standards in trust. Note that an order to pay wages issued under clause (b) will include administrative costs. See s.103(2) below.
Section 103(2) provides that the order issued under s. 103(1)(b) shall, in addition, contain an amount for administrative costs equal to 10 per cent of the amount of the wages, or $100, whichever is greater. Thus, for example, if the gross amount of the wages owing (before deductions for income tax, Employment Insurance and Canada Pension Plan) is $600, the administrative costs fee added to the order would be $100.
Note that there are similar provisions regarding administrative costs associated with orders issued under ss. 74.14, 74.16, 74.17 and 104.
The administrative costs are not intended to be a penalty and the Program does not use them as such.
This provision empowers an officer to order wages on behalf of other employees who are entitled under the Act besides the claimant. See Clevelands House Limited v. Hay et al. (April 30, 1981), ESC 985 (Howe), Unique Media Incorporate v. Castello (September 8, 1988), ESC 2372 (Haefling), and Marcello Tranatino Manufacturing Inc. v. Scarlett (October 21, 1988), ESC 2404 (Haefling).
Subsection 103(4) was amended by the Stronger Workplaces for a Stronger Economy Act, 2014 effective February 20, 2015. This section imposed a cap of $10,000 on the amount of wages an employment standards officer could order for a single employee with respect to wages that came due prior to February 20, 2015. Subsection 103(4.1), which was also added to s.103 by the Stronger Workplaces for a Stronger Economy Act, 2014 effective February 20, 2015, eliminated the $10,000 cap with respect to orders for unpaid wages that come due on or after that date. Subsections 103(4) and 103(4.1) were transitional provisions and both were repealed on February 20, 2017.
Although these subsections are now repealed, it is Program policy that the $10,000 cap on orders to pay wages continues to apply to wages that became due before February 20, 2015, even if any associated orders are issued after February 20, 2017. This is to preserve the vested legal rights of the parties at the time the contravention occurred. This is relevant in situations where a period of time lapses between the time a claim is filed and the time a claim is investigated.
Note that s. 103(4) was a transitional provision that was repealed on February 20, 2017 in accordance with ss. 7(2) and 10(5) of Schedule 2 to the Stronger Workplaces for a Stronger Economy Act, 2014.
Prior to its repeal, this section put a cap of $10,000 on the amount of wages an employment standards officer could order for a single employee with respect to wages that came due prior to February 20, 2015. However, it is Program policy that the $10,000 cap imposed by s. 103(4) continues to apply to wages that became due before February 20, 2015, even if any associated orders are issued after February 20, 2017.
Note that there is no cap on orders for compensation issued under ss. 74.16, 74.17 or 104, on orders for the recovery of fees under s. 74.14 or on orders against directors under s. 106 and s. 107.
Note that the cap in s. 103(4) applied to the amount of wages that came due prior to February 20, 2015 and not to the amount of the order to pay wages itself. Thus, an order to pay wages for a single employee could be for an amount greater than $10,000. That is, the order could be made out up to a maximum of $10,000 for the gross amount of the assessment, but would also include $1,000 for the 10% administrative fee, for a total of $11,000. In addition, an order could include any amount of wages that come due on or after February 20, 2015. For example, if an employee was owed $12,000 in respect of wages that came due prior to February 20, 2015 but is also owed wages (e.g., $5000) that came due on or after February 20, 2015, the order could be issued in the amount of $15,000 plus $1,500 for the 10% administrative fee as the $10,000 cap does not apply in respect of any wages that came due on or after February 20, 2015.
Questions may arise as to whether an employee who is owed more than $10,000 in wages (e.g., $15,000) that came due prior to February 20, 2015 could have filed a claim with the Ministry for $10,000, have an order issued for that amount and then filed another claim for the excess amount and had a second order issued for $5,000. The answer is no. Such a procedure would have been contrary to the intent of s. 103(4). However, if the employee was owed $10,000 in wages that came due prior to February 20, 2015, filed a claim for that amount, an order was issued, and subsequently a new and separate amount of $5,000 in wages became owing to the employee (again pre-February 20, 2015), it would not be contrary to the intent of s. 103(4) for a second order to be issued under s. 103(1) for the new amount owing.
With respect to wages that came due prior to February 20, 2015, the question may arise as to whether the $10,000 cap applied to limit recovery under the Act even where there was no order issued by an employment standards officer. This issue was considered by the Divisional Court in Ontario (Director of Employment Standards) v. Brown, [2004] Ontario Labour Relations Board Rep. 467 in an appeal from a decision of the Ontario Labour Relations Board in Brown v. North York Chevrolet Oldsmobile Ltd., 2003 CanLII 19379 (ON LRB). In that case, the employee was terminated without notice by the employer and sought termination pay in lieu of notice, severance pay and vacation pay totalling $37,277.02. The officer advised the employer that an order under the Act would be limited to $10,000 and the employer agreed to pay that amount directly to the employee under s. 103(1)(a).
The employee then filed an appeal to the Board seeking the balance of the monies that had been assessed as owing. The Board found that the arrangement to pay the $10,000 directly to the employee was not a true agreement pursuant to s. 103(1)(a) because the employer had not paid the full amount assessed as owing by the employment standards officer. The Board also found that as no order had been issued under s. 103(1)(b) that the employee was entitled to view the circumstances as a refusal to issue an order. He could therefore appeal the refusal and ask the Board to issue an order with respect to his unpaid entitlements. As the Board also concluded that there was no s. 112 settlement in this case, it concluded that it was empowered to issue an Order to Pay in the amount of $10,000, the maximum amount allowed under the Act at the time.
Note that s. 103(4.1) was a transitional provision that was repealed on February 20, 2017 in accordance with ss. 7(2) and 10(5) of Schedule 2 to the Stronger Workplaces for a Stronger Economy Act, 2014.
This provision was added to the Act by the Stronger Workplaces for a Stronger Economy Act, 2014, effective February 20, 2015. It eliminated the $10,000 cap with respect to orders for unpaid wages that come due on or after this provision came into force.
Section 103(5) is the source of the requirement for the various inclusions to an order to pay wages, such as the covering letter, Officer’s Narrative and Worksheet, which must set out enough information that the employer will know the amount to be paid and the nature of the violation of the Act that gives rise to the entitlement ordered to be paid. The language of the section is specific: the order to pay must contain or have attached to it the information required. The fact that the employer had knowledge previously of the nature of the violation and the amount owing does not relieve the officer of the onus of setting out this information as part of the order to pay wages.
The provision requires that an order to pay wages be served on the employer in accordance with ESA Part XXI, s. 95.
Section 103(7) provides that an employee who is the subject of an order to pay (whether or not they were a complainant) is entitled to notice that the order was issued. Such notice is to be served in accordance with ESA Part XXI, s. 95.
This provision should be read together with s. 116(2), which establishes a right of review for such employees, and s. 116(4), which states that the time period for applying for such a review is 30 days after the date on which the letter advising of the order is served. See ESA Part XXIII, s. 116 for a further discussion.
This provision states that an employer against whom an order to pay is issued must comply with the terms of the order. If the employer wishes to have the order reviewed, the procedure for filing for a review of the order is set out in ESA Part XXIII, s. 116. Section 116 is incorporated by reference into the terms of an order to pay wages; therefore filing for a review of the order is considered compliance with the terms of the order. Paying the full amount of the order or filing for review are the employer’s only options with respect to complying with the terms of the order.
Section 103(9) states that if an employer has not applied for a review of an order issued under s. 103 within the time period set out in s. 116, the order becomes final and binding on the employer. Section 103(10) clarifies that if an employer failed to apply for a review of an order for wages, the order becomes final and binding against that employer, even if, for example, a director of that employer obtained a review of an order issued against the director with respect to the same unpaid wages. See ESA Part XXIII, s. 116 for a discussion of the time periods for applying for review.
Likewise, even though a director of the employer reviewed a director’s order issued under ss. 106 or 107 and it was held that the employee was not owed monies under the Act, the employer could not rely on that decision in resisting collection efforts with respect to the order issued against it under s. 103, because the employer neither paid nor appealed the s. 103 order.
Similarly, if, for example, employer A fails to pay or apply to review the order issued against it, the order becomes final and binding against it even though company B, allegedly related to A under s. 4 of the Act, applies for a review of a separate order against B. If the result of the hearing concerning B is that B is not liable because A did not owe the employee any wages, A could not rely on that decision in resisting collection efforts against it, since A did not apply to review the order against it.
This provision creates a single order making power for most of the provisions in the Employment Standards Act, 2000 for which the remedy for a contravention is an order for compensation or reinstatement. These are Part XIV Leaves of Absence, Part XVI Lie Detector Tests, Part XVII Retail Business Establishments and Part XVIII Reprisals. Note that the Part XVIII.1 Temporary Help Agencies provisions also provide for compensation orders issued under s. 74.16 and s. 74.17 for certain contraventions under that part.
Most orders issued under s. 104 are issued for a contravention of ESA Part XVIII, s. 74(1) which states:
Section 104(1) was amended by the Employment Standards Amendment Act (Temporary Help Agencies), 2009, S.O. 2009, c. 9, effective November 6, 2009 to allow an order to be issued against any person (rather than just an employer) who contravenes a provision in one of the listed Parts of the Employment Standards Act, 2000 with respect to an employee. Where a contravention can be committed by a person other than an employer, such as under Part XVI Lie Detectors and Part XVIII Reprisal, an order issued under s. 104 can be issued against the person who violates the provision.
Employees seeking an order for compensation and/or reinstatement are subject to the two-year limitation period for filing a complaint established under ESA Part XXII, s. 96(3). That section provides that a complaint filed more than two years after the contravention has occurred will be deemed not to have been filed. Damages awards made under s. 104 are not subject to the two year limitation on recovery of wages imposed by ESA Part XXII, s. 111. Section 111 states that an employee cannot recover money that came due more than two years preceding the date the complaint was filed. Because the damages awarded in s. 104 orders do not come due until the officer issues the order, s. 111 does not restrict recovery of damages.
However, if some part of the s. 104 order includes an assessment for wages that had come due under the Act, e.g., earned wages, overtime pay, vacation pay, public holiday pay, termination pay or severance pay, that amount would be subject to the limitations on recovery set out in s. 111.
Lastly, s. 104(2) clarifies that an order for compensation and/or hiring (as opposed to reinstatement) may be issued against an employer, as defined in ESA Part XVI, s. 68, with respect to persons who are not hired because they have refused to take a lie detector test, including applicants for the position of a police officer. The section is unique in that it clearly establishes a remedy that includes an order to hire for persons who are not employees under the Employment Standards Act, 2000.
Where an order is issued for compensation under s. 104, s. 104(3) provides that the order must also require the person to pay the amount of the compensation to either the Director in trust pursuant to s.104(3)(a) or to the employee pursuant to s.104(3)(b). If the terms of the order require the person to pay the amount of the compensation to the Director in trust, the person will also be required to pay an amount for administration costs equal to the greater of 10 per cent of the compensation or $100 to the amount of a compensation order issued under this section to the Director in trust. Note that the required terms in s. 104(3)(b) do not include administrative costs.
Subsection 104(4) provides that the following subsections of ESA Part XXII, s. 103 regarding orders to pay wages also apply, with necessary modifications, to orders for compensation:
Under s. 105(1), if the officer and employer have arranged for the employer to pay monies owing directly to the employee(s)or the officer has issued an order under ESA Part XXII, s. 103(1)(a.1), but the employer is unable to find the employee(s) after having made a reasonable effort to do so, the employer must pay the amount of the wages owing to the employee(s) to the Director of Employment Standards in trust.
Similarly, under s. 105(2), if an officer receives money on behalf of an employee in a settlement under ESA Part XXII, s. 112 and the employee cannot be located, the money shall be paid to the Director in trust. A trust is imposed upon the Director in the name of the Ministry of Labour to preserve the employee’s right to the funds collected.
See Delegation of Powers for information regarding to whom the Director has delegated the non-discretionary power to receive monies into trust under ss. 105(1) and 105(2).
Section 105(3) states that where there has been a payment into trust on behalf of an employee and the employee cannot be located, the funds vest in the crown. These funds effectively become part of the government’s general revenues, and since there is no interest payable on such funds, the section specifically states that the funds referred to do not earn interest.
The language of this section is permissive; that is the Director is given the discretion to pay out the funds collected to another person in the stead of the employee or to the employee themselves if they are subsequently located. The Director may do this; there is no requirement in the section that the Director do so.
Section 106(1) was amended by the Employment Standards Amendment Act (Temporary Help Agencies), 2009, S.O. 2009, c. 9, which came into force on November 6, 2009 to make reference to the service provisions in s. 95 as amended by that Act.
Section 106(1) indicates that if an employment standards officer issues an order to pay to an employer for wages under s. 103 of the Employment Standards Act, 2000, the officer may also issue an order to pay wages against some or all of the directors of the employer, subject of course to the limits on directors' liability in s. 81(7). Note that directors are not liable for compensation ordered under s. 104. See ESA Part I, s. 1 for a discussion of the definition of wages and also see ESA Part XX (Liability of Directors) for further discussion of directors' liability.
Section 106(1) also indicates that if the officer decides to issue an order against some or all of the directors, the officer should attach to the director’s order a copy of the order to pay that was issued against the employer; both the director’s order and the attached employer order to pay are to be served together on the director in accordance with s. 95. See ESA Part XXI, s. 95 for a discussion of service under s. 95.
The question arises as to whether the order to pay against the director should be issued at the same time as the order against the company, or whether it should be issued some time later. See the Administration Manual for Employment Standards for guidelines with respect to orders against directors.
Section 106(2) indicates that if a director does not comply with the order to pay against him or her, and does not apply to have it reviewed, then the order against that director becomes final and binding against him or her, even though a review hearing is held to determine the liability of that person’s co-directors, or the liability of the employer.
For example, if director A does not apply to have the order to pay against him or her reviewed and does not comply with it, then the employment standards officer may attempt to collect the amount of the order from that director, (e.g., through third party demands under s. 125 or certificates under s. 126), even though that person’s co-directors, B, and C, or the employer, have applied to have the order reviewed. This applies even in cases where B and C are disputing the order against them on the grounds that the employees are not owed wages or vacation pay by the employer. If the result of the hearing concerning the liability of B and C is that they are found not liable on the grounds that the employer did not owe the employees wages or vacation pay, then A may not raise this as a defence in connection with the order against A, since A did not apply to review the order or comply with it voluntarily. Furthermore, where amounts owing under the order against A have been paid through collection efforts under ss. 125 or 126, or otherwise, A could not demand repayment of those monies on the grounds that the Ontario Labour Relations Board had subsequently found, after the hearing concerning B and C, that the employer did not owe the employees wages or vacation pay.
Section 106(3) was amended by the Employment Standards Amendment Act (Temporary Help Agencies), 2009 effective November 6, 2009 to make reference to the service provisions in s. 95 as amended by that Act.
If there is a trustee in bankruptcy or a court-appointed receiver, the employment standards officer, because of contempt of court principles, is precluded from issuing an order to pay to the employer, but would instead file a proof of claim on behalf of the employees with the receiver or the trustee, as the case may be. If this is done, and the claim is not paid and the 30-day period to apply for a review has expired, the officer may at that point issue an order to pay against some or all of the directors for the wages and vacation pay that are owed to the employees by the employer. Therefore, even though s. 106(1) states that an order to pay against the employer is required before an order can be issued against the directors, an order against the directors is permitted in situations where a proof of claim is issued instead of an order against the employer, because there is a bankruptcy or court-appointed receivership.
An order to pay wages issued against a director under this section must be served in accordance with s. 95 of the Act. See ESA Part XXI, s. 95 for a discussion of the service provisions.
The Ontario Court of Appeal in Rizzo & Rizzo Shoes Ltd. (Re), 1995 CanLII 1225 (ON CA) held that the Ministry of Labour does have the authority to file proofs of claim on behalf of the employees, without the express written authorization of each individual employee. This decision supports Program policy on that particular point.
Section 106(4) indicates that just like an order against a director of a solvent employer, an order issued against a director of an insolvent employer will become final and binding on the director if it is not complied with or if no application for review is made, even though a review hearing is held to determine another person’s liability, e.g., a review hearing of a co-director’s liability, under the Act.
Section 106(5) confirms that the maximum liability of a director with respect to an order issued under s. 106 is as set out in s. 81 of the Act. Under s. 81(7), the maximum liability for directors with respect to wages is a joint and several liability to the employees of the corporation for all debts not exceeding six month’s wages (per employee) that became due while the person was a director and 12 months accrued vacation pay (per employee) that accrued while the person was a director. Note that there is no liability for compensation as ordered under s. 104 because such monies are not considered wages under the Act. See ESA Part I, s. 1 for a discussion of the definition of wages.
Under s. 81(8) directors are also liable for interest on the outstanding wages for which they are liable. For further discussion of directors' liability, see ESA Part XX, s. 81.
Interest is to be calculated in a manner to be determined by the Director under ESA Part XXI, s. 88(5).
This section states that the Director of Employment Standards has the power to require a director who is served with an order under s. 106 to pay the wages and vacation pay covered by the order to the Director of Employment Standards in trust, instead of to the employees directly. For information regarding the persons to whom this power has been delegated, please see Delegation of Powers.
The main purpose of this discretion is to facilitate the refunding mechanism where, due to joint and several liability, more than the amount of the order is received from the directors. For example, if A, B and C are jointly and severally liable for $10,000 in wages and vacation pay, the officer can issue an order to each of A, B and C for $10,000. If A pays $10,000, B pays $5,000 and C pays $5,000, then $10,000 would have to be refunded to the directors. If the monies are paid to the Director of Employment Standards in trust, the refunding is easier than if the monies had been paid directly to the employees.
Section 107(1) was amended by the Employment Standards Amendment Act (Temporary Help Agencies), 2009, S.O. 2009, c. 9, which came into force on November 6, 2009 to make reference to the service provisions in s. 95 as amended by that Act.
Section 107(1) sets out three situations in which an employment standards officer may make an order against directors who did not receive orders pursuant to s. 106:
Whereas s. 106(1) provides that the employment standards officer who issued a s. 103 order may issue a director’s order, s. 107(1)(a) enables an employment standards officer who did not issue the order under s. 103 to issue a director’s order to pay. This is because it provides that an employment standards officer may issue if an employment standards officer has made a s. 103 order against the employer that is unpaid and has not been appealed.
If an employment standards officer has issued s. 106 orders against some of the directors of a corporate employer and the directors (or the employer acting on their behalf) have not paid or appealed such orders, an employment standards officer may issue an order against any other directors under s. 107. Again, because of the reference to an employment standards officer, s. 107(1)(b) enables an employment standards officer who did not issue the s. 106 order(s) to subsequently issue a director’s order.
If on appeal under s. 116, the Board issues, amends or affirms an order to pay against a corporate employer or director, an employment standards officer may make an order against the directors under s. 107. There is no requirement that the employment standards officer issuing a director’s order to pay under this section be the same officer that made the determination that the corporate employer or director appealed to the Board.
Note that in a hearing involving an employer’s application for review, the monies owing pursuant to the order to pay will have been paid by the employer to the Director of Employment Standards in trust. Consequently, an order to pay would not be issued against the directors under s. 107 unless there were insufficient funds in trust to satisfy the amount of the order because the Board raised the amount of the order, or because, when the application for review was filed, the Director accepted an irrevocable letter of credit for less than the amount ordered.
In a hearing involving a director’s application for review of an order issued under s. 106, the officer could issue an order against additional directors under s. 107 if the Board affirmed or amended the order issued under s. 106.
Any orders issued under this section must be serviced in accordance with ESA Part XXI, s. 95.
This provision is identical to s. 106(6).
This section states that the Director of Employment Standards has the power to require a director who is served with an order under s. 107, to pay the wages and vacation pay covered by the order, to the Director of Employment Standards in trust, instead of to the employees directly. For information regarding the persons to whom this power has been delegated, please see Delegation of Powers.
The main purpose of this power is to facilitate the refunding mechanism where, due to joint and several liability, more than the amount of the order is received from the directors. For example, if A, B and C are jointly and severally liable for $10,000 in wages and vacation pay, the officer can issue an order to each of A, B and C for $10,000. If A pays $10,000, B pays $5,000 and C pays $5,000, then $10,000 would have to be refunded to the directors. If the monies are paid to the Director of Employment Standards in trust, the refunding is easier than if the monies had been paid directly to the employees.
Section 108, which was introduced by the Employment Standards Act, 2000, created a new enforcement tool for employment standards officers. Where the officer finds a contravention of the Employment Standards Act, 2000 or regulations, the officer may issue an order requiring the person who has contravened the Employment Standards Act, 2000 to, by a date specified in the order:
Because s. 108 is applicable to any violation under the Employment Standards Act, 2000 it allows an officer to issue a compliance order for violations that could not be the subject of an order under ESA Part XVIII.1, s. 74.14, 74.16, 74.17, or ESA Part XXII, s. 103 or 104. Compliance orders can therefore be issued for non-monetary violations, although they are not limited to that purpose. For example, there would be a non-monetary violation if the employer contravened s. 20 by not providing employees with a 30-minute meal break or contravened s. 12 by not providing employees with a statement of wages.
Note that the officer may issue a compliance order to any person that has contravened the Employment Standards Act, 2000. The word "person" indicates that the order may be issued against persons other than an employer. For example, a compliance order could be issued against a person such as an owner or manager of a building who fails to provide information requested by a new provider of services as per ESA Part XIX, s. 77(2). See the definition of person in ESA Part I, s. 1.
This provision was amended by the Employment Standards Amendment Act (Temporary Help Agencies), 2009, S.O. 2009, c. 9, effective November 6, 2009 to include a reference to orders to recover fees under ESA Part XVIII.1, s. 74.14.
Section 108(2) states that a compliance order itself shall not require the payment of wages, fees or compensation. The compliance order will therefore not be used to require payment of unpaid wages, fees or compensation. It is limited to directing a person who has or is contravening the Employment Standards Act, 2000 to cease doing so or to take action to bring itself into compliance. Note that this provision does not restrict the officer’s ability to issue a notice of contravention under ESA Part XXII, s. 113 (which carries with it a financial penalty) with respect to the same violation that triggered the issuance of the compliance order. See the discussion in ESA Part XXII, s. 113(7).
This subsection was amended by the Employment Standards Amendment Act (Temporary Help Agencies), 2009 to reference orders under ESA Part XVIII.1.
Although s. 108(2) precludes the compliance order from requiring payment of wages, fees or compensation, s. 108(3) specifically allows the officer to issue a separate order to recover fees under ESA Part XVIII.1, s. 74.14 order for compensation against a temporary help agency under ESA Part XVIII.1, s. 74.16, compensation/reinstatement order relating to a client reprisal under ESA Part XVIII.1, s. 74.17, order to pay wages under ESA Part XXII, s. 103, a compensation/reinstatement order under ESA Part XXII, s. 104, or a director’s order under ESA Part XXII, s. 106 or 107 with respect to the same contravention for which they issue the compliance order. It follows therefore that the issuance of a compliance order is not limited to situations involving non-monetary contraventions. For example, if an employer is found to have violated ESA Part VIII, s. 22(1), which requires the payment of overtime pay for hours worked in excess of 44 per week, the employment standards officer may issue an order under ESA Part XXII, s. 103 for the overtime pay owing to the employees as well as a compliance order under s. 108 that requires the employer to comply with s. 22(1).
This subsection was amended by the Employment Standards Amendment Act (Temporary Help Agencies), 2009, which came into force November 6, 2009, to include references to clients and assignment employees and prospective assignment employees.
Section 108(4) provides that the rules as set out under ESA Part XXII, s. 103 regarding service, notice to employees, compliance, and the binding effect of an order for which no timely application for review is made apply to compliance orders issued under s. 108.
As a result, a compliance order must be served in accordance with ESA Part XXI, s. 95. Additionally, when an employment standards officer issues a compliance order with respect to an employee, he or she must advise that person of the issuance of the order through a letter served in accordance with s. 95.
The person against whom the compliance order is issued shall comply with it according to its terms and if the person against whom the order is issued does not apply to the Board for a review within the time set out in ESA Part XXIII, s. 116, the order becomes final and binding.
See the discussion at ESA Part XXII, s. 103(6) to (9). When cross-referencing these provisions, any modifications necessary for s. 103(6) to (9) to make sense in the context of a compliance order will apply. When an officer issues a compliance order with respect to Part XVIII.1, such modifications include reading the term employer to also mean client of a temporary help agency and reading the term employee to also mean an assignment employee or prospective assignment employee.
Section 108(5) enables the Director to apply to the court, without notice to the person to whom a compliance order was issued, for an order of the court requiring that person to cease contravening the terms of the compliance order. Such a court order is referred to as an injunction.
In effect, this provision provides the Director with a mechanism to obtain a court order requiring compliance with the Employment Standards Act, 2000, without the necessity of initiating a prosecution. Section 108(6) makes it clear that the injunction order under s. 108(5) is available in addition to any other remedy or penalty for the contravention of the order. In other words, it would not preclude a prosecution for a contravention of the order or imposition of the penalties and remedies under ESA Part XXV, s. 132 to 137, inclusive.
See Delegation of Powers for information on how this power has been delegated.
Section 109(1) was amended by the Employment Standards Amendment Act (Temporary Help Agencies), 2009, S.O. 2009, c 9, effective November 6, 2009 to broaden its application to monies paid pursuant to orders issued under Part XVIII.1 of the Employment Standards Act, 2000.
Section 109(1) indicates that where there has been payment of wages, fees or compensation that were the subject of an order, and the person against whom the order was issued has not applied for review under s. 116, the money paid into trust will be paid out to the person named in the order. The Trust Funds Unit of the Employment Practices Branch (acting for the Director) will pay out after waiting the 30 days (or longer, if there has been an extension granted in the case) for any application for review by the employer or, in the case of an order issued under ss. 106 or 107, the director.
Note that this section makes no provision for the payment of any interest that may have accrued on the monies paid to the Director in trust. Although s. 88(7) states that where money has been paid to the Director in trust it shall be paid out to the person entitled to receive it together with interest at the rate calculated and manner determined by the Director in ss. 88(5), s. 88(7) only applies where no provision is made elsewhere in the Act for paying out the monies held in trust.
Section 109(2) states what happens when the amount received is less than the full amount of the order (including administrative costs).
In this situation, the Director of Employment Standards distributes the money received to each person who is the beneficiary of the order in proportion to the amount they are owed. The Director does not retain any of the money for the administrative costs unless those beneficiaries are paid in full. (This is the case even if the employer specifically submitted some of money for the purpose of paying the administrative costs portion of the order.)
Please see ESA Part I, s. 1 for a discussion of the term "person" under the Act.
This provision is substantially the same as the corresponding section (s. 72(5)) in the former Employment Standards Act. Section 109(3) simply states that the distribution of money received in compliance with this section does not leave the Director open to any civil or criminal liability. Though the word "proceeding" is not defined in the Act, it seems clear that its plain meaning is intended by this section. The protection afforded to the Director under this section would extend to the Director’s delegate acting under this section. See Delegation of Powers for information.
Section 110(1) was amended by the Employment Standards Amendment Act (Temporary Help Agencies), 2009, S.O. 2009, c 9, which came into force on November 6, 2009 to include references to refusals to issues orders under Part XVIII.1.
Section 110(1) imposes an obligation on an employment standard officer assigned to investigate a complaint to notify a complainant by letter of his or her decision not to issue any of the following orders:
The letter advising the complainant of the refusal to issue an order must be served in accordance with s. 95 — see ESA Part XXI, s. 95 for more information.
Note: this section does not impose any obligation to notify a complainant of a refusal to issue a director’s order under ss. 106 or 107, as employees do not have the right to apply to review a refusal to issue an order against a director. It should also be noted that there is no obligation to notify non-complainants of the refusal to issue any of the listed orders.
The rationale for the notice and service provisions in s. 110 may be found in s. 116(4) of the Employment Standards Act, 2000. Section 110 effectively establishes the start date of the 30-day period set out in s. 116(4) within which a complainant must apply for a review of the officer’s decision not to issue an order under ss. 74.14, 74.16, 74.17, 103, 104 and 108.
This provision was amended by the Employment Standards Amendment Act (Temporary Help Agencies), 2009, which came into force on November 6, 2009 to reference a "person" rather than an "employee".
This section is similar to the corresponding section (s. 67(2)) of the former Employment Standards Act. Section 110(2) indicates that if no order is issued within two years after the complaint was filed, then the employment standards officer shall be deemed to have refused to issue an order on the day before the two-year limitation period expires. Therefore, for example, if during the two years after the person files his or her claim, the officer neither issues an order, nor refuses to issue an order, then the officer will be deemed to have refused to issue an order on the day before the two-year period expires.
One reason for this provision is so that, in the unfortunate and rare event that the Ministry has neither issued an order nor refused to do so during the two-year limitation period set out in s. 114(1)(a) of the Act, the person can still apply for a review by the Ontario Labour Relations Board under s. 116. The person would have 30 days from the day before the two-year period expires in which to apply for a review of the officer’s deemed "refusal".
Section 111(1) as amended by the Stronger Workplaces for a Stronger Economy Act, 2014, S.O. 2014, c. 10, effective February 20, 2015 provides that, if an employee has filed a complaint under the Employment Standards Act, 2000, the order for wages that became due to the employee either in respect of the contravention alleged in the complaint or any contravention discovered during the course of the investigation is limited to those wages that became due to the employee within the two-year period preceding the date the complaint was filed.
It must be noted however that s. 111(1) applies only with respect to wages that became due on or after February 20, 2015. See the discussion under Transitional Provisions below on the limitation periods for wages that became due before February 20, 2015.
In order for an employee to recover wages that came due on or after February 20, 2015 in accordance with s. 111(1), such wages must have come due in the two-year period preceding the date the claim was filed.
The following is intended to assist officers in determining when various types of wages become due under the Act:
Come due on the regular pay day as established by employer practice. Following termination, on the later of seven days after termination or the day that would have been the employee’s next regular pay day.
On the later of seven days after termination or the day that would have been the employee’s next regular pay day, unless the severance pay is to be paid out in instalments in accordance with ESA Part XV, s. 66. Note also that where an employee elects to retain recall rights or makes no election, termination and/or severance pay is due when the recall rights expire or are renounced. See the discussion at ESA Part XV, s. 66 and 67.
Vacation pay comes due generally before the employee takes vacation, but in some cases will come due on or before the pay day for the period in which the vacation falls, which must be taken within 10 months following the vacation year or within such shorter period as established by contract. Or, the parties may agree in writing that the vacation pay will come due on each pay day as it accrues. It may also come due at such other time as agreed in writing by the parties. Finally, following termination, vacation pay comes due on the later of seven days after termination or the day that would have been the employee’s next regular pay day.
Because vacation pay can be paid in a number of ways under the Act and may therefore come due at different times, the application of s. 111 to vacation pay is quite complex.
Any vacation pay will be recoverable if it came due in the two year period preceding the date the claim was filed. Note that this applies only to vacation pay that became due on or after February 20, 2015. See s. 111(3.2) for a discussion of the limitation periods for vacation pay due before February 20, 2015.
However, it is important to note that vacation pay may come due at different times in accordance with ESA Part XI, s. 36:
Pursuant to ESA Part XI, s. 35 and 35.1, vacation pay is due prior to the commencement of the vacation and vacation time must be taken within 10 months following the end of the period for which it was earned. In the case of the vacation pay accrued over a vacation entitlement year, the latest the vacation pay will be due before the end of the 10-month period following the completion of the vacation entitlement year (assuming that no vacation time has been taken in respect of that vacation entitlement year) would therefore be:
In the case of vacation pay accrued over a stub period, the latest the vacation pay will be due (assuming that no vacation time has been taken in respect of that stub period) would be 10 months following the completion of the stub period less the vacation time earned over the stub period.
If vacation pay is paid in accordance with s. 36(2), i.e., wages are paid by direct deposit or the employee does not take vacation in complete weeks, the vacation pay is due on or before the pay day for the period in which the vacation falls. Again, the latest the vacation may be taken is within 10 months following the completion of the period for which it was earned. With respect to any completed vacation entitlement year then, the latest the vacation pay accrued in that year would be due (assuming that no vacation time has been taken in respect of that vacation entitlement year) would be the pay day for the last pay period that ended within the 10 months following the completion of the vacation entitlement year. In the case of vacation pay accrued over a stub period, the latest the vacation pay would be due (assuming that no vacation time has been taken in respect of that stub period) would be the pay day for the last pay period within the 10 months following the completion of the stub period.
If vacation pay is paid in accordance with s. 36(3), i.e., the employer pays vacation pay that accrues in each pay period on the pay day for that period, the vacation pay is therefore due on the pay day for each pay period, regardless of when the vacation time is taken.
If vacation pay is paid in accordance with s. 36(4), i.e., where the employer and employee may agree to the payment of vacation pay at any time, the vacation pay is due on the date so agreed by the parties regardless of when the vacation time is taken.
Damages owing under a compensation order only come due on the date the officer issues the order. As a result, when an officer is issuing a compensation order under ESA Part XXII, s. 104 for a violation of Part XIV Leaves of Absence, Part XVI Lie Detectors, Part XVII Retail Business Establishments or Part XVIII Reprisal, the limitation on recovery in s. 111 will not apply to the damages awarded pursuant to the order. An order for reinstatement is also not limited by s. 111 because the subject of the order in that case is not wages that come due under the Act. But see the discussion regarding the two-year limitation period on filing claims in ESA Part XXII, s. 96(3).
However, if a compensation or reinstatement order also includes an assessment for wages that were due under the Act, for example, where wages or vacation pay were earned prior to a termination contrary to the reprisal provisions in Part XVIII, those wages will be subject to the s. 111 limitations on recovery based on the date such monies came due under the Act.
In accordance with s. 111(2), if an officer is investigating a complaint filed by employee A and during the course of that investigation discovers that monies are also owing to employees B, C and D, the officer may issue an order with respect to employees B, C and D only for those wages including vacation pay that became due within the two-year period preceding the date A filed their complaint. In other words, with respect to any wages, employees A (the complainant) and B, C and D are all able to recover those wages including vacation pay that became due not more than two years prior to the date of A's complaint.
Note that this applies only to wages that became due on or after February 20, 2015. See the discussion under Transitional Provisions below on the limitation periods for wages that became due before February 20, 2015.
In accordance with s. 111(3), where an officer is conducting an inspection, the limitation on recovery for all unpaid wages discovered during the inspection will be the two-year period preceding the date the inspection was commenced. In other words, with respect to any unpaid wages, the officer may issue an order for those wages if they came due within the two-year period preceding the date the inspection commenced.
Note that this applies only to wages that became due on or after February 20, 2015. See the discussion under Transitional Provisions below on the limitation periods for wages that became due before February 20, 2015.
On February 20, 2015, the Stronger Workplaces for a Stronger Economy Act introduced a number of transitional provisions that imposed a six-month limitation period on unpaid wages that became due before February 20, 2015, and a 12-month limitation period for repeated contraventions and vacation pay that became due before February 20, 2015. Sections 111(3.1) to (8) were repealed on February 20, 2017 in accordance with ss. 8(6) and 10(6) of Schedule 2 to the Stronger Workplaces for a Stronger Economy Act, 2014.
Although these sections are now repealed, it is Program policy that the limitation periods imposed by the transitional provisions continue to apply to wages, repeated contraventions and vacation pay that became due before February 20, 2015, even if any associated orders are issued after February 20, 2017. This is to preserve the vested legal rights of the parties at the time the contravention occurred. This is relevant in situations where a period of time lapses between the time a claim is filed and the time a claim is investigated.
Note that s. 111(3.1) was a transitional provision that was repealed on February 20, 2017 in accordance with ss. 8(6) and 10(6) of Schedule 2 to the Stronger Workplaces for a Stronger Economy Act, 2014.
Prior to its repeal, s. 111(3.1) together with the repealed ss. 111(3.2), (4) and (6) and ss. 111(5), (7) and (8) operated to impose the six-month limitation period on unpaid wages or 12 month limitation for repeated contraventions and vacation pay that applied prior to February 20, 2015, the date s. 111 was amended by the Stronger Workplaces for a Stronger Economy Act, 2014. Under s. 111(3.1), the six-month limitation period on recovery of wages specifically applied only in respect of those wages that came due prior to February 20, 2015. However, it is Program policy that the six month limitation period imposed by s. 111(3.1) continues to apply to wages that became due before February 20, 2015, even if any associated orders are issued after February 20, 2017.
Note that s. 111(3.1) is also subject to the provisions that impose a 12-month recovery period for repeat contraventions and for vacation pay with respect to monies that came due prior to February 20, 2015.
An example of how s. 111(3.1) applied is as follows:
Note that s. 111(3.1) was a transitional provision that was repealed on February 20, 2017 in accordance with ss. 8(6) and 10(6) of Schedule 2 to the Stronger Workplaces for a Stronger Economy Act, 2014.
Prior to its repeal, s. 111(3.2) imposed a 12-month limitation on the recovery of unpaid vacation pay that applied prior to the amendments made by the Stronger Workplaces for a Stronger Economy Act, 2014. In accordance with the repealed s. 111(3.1) this 12-month limitation applied only with respect to vacation pay that came due prior to the February 20, 2015, the date the amendments to s. 111 made by the Stronger Workplaces for a Stronger Economy Act, 2014 came into force. However, it is Program policy that the 12 month limitation period imposed by s. 111(3.2) continues to apply to vacation pay that became due before February 20, 2015, even if any associated orders are issued after February 20, 2017.
As a result, where an employment standards officer is investigating a complaint or conducting an inspection and finds during the course of that investigation or inspection that an employer has failed to pay any vacation pay that came due prior to February 20, 2015, the officer is limited to issuing an order for such vacation pay to that which came due within the 12-month period preceding the date the complaint was filed or the inspection was commenced.
Note that s. 111(4) was a transitional provision that was repealed on February 20, 2017 in accordance with ss. 8(6) and 10(6) of Schedule 2 to the Stronger Workplaces for a Stronger Economy Act, 2014.
Prior to its repeal, s. 111(4) operated to impose a 12-month limitation period on the recovery of unpaid wages where there are repeated contraventions but only with respect to unpaid wages that came due prior to February 20, 2015, the date the changes to s. 111 made by the Stronger Workplaces for a Stronger Economy Act, 2014 came into force. However, it is Program policy that the 12 month limitation period imposed by s. 111(4) continues to apply to repeated contraventions of the requirement to pay wages that became due before February 20, 2015, even if any associated orders are issued after February 20, 2017.
Subsection 111(4) therefore extended the limitation on recovery of wages (other than vacation pay) as set out in the repealed s. 111(3.1) from six months to 12 months when there has been a repeated contravention. Specifically, any unpaid wages (other than vacation pay) that came due prior to February 20, 2015, can be recovered if they became due in the 12-month period preceding the date a complaint was filed or inspection commenced and:
For example, s. 111(4) would apply where there was a contravention of the requirement to pay overtime and such overtime pay was due more than six months prior to the date the complaint was filed or inspection commenced if there was also a contravention of that same provision on at least one occasion in the six-month period preceding the date the complaint was filed or the inspection commenced.
It is important to note that this section allows for a finding of a repeated violation only in regards to each employee. Thus, for example if the employer violates the public holiday provisions of s. 24 once with regard to employee A and then a second time with regards to employee B and a third time with regards to employee C, so that s. 24 is only violated once with regards to each employee, this is not a repeated violation of the Act with regards to any given employee and therefore s. 111(4) does not apply.
The following example is an illustration of how the repealed repeated contravention provision applied where the investigation reveals multiple entitlements for more than one employee:
In this case the officer could issue an order for the following:
The officer could not issue an order for the overtime pay due to employee C on December 15, 2013 because C's overtime entitlement was not a repeat contravention and would therefore have had to come due within six months of the date A filed their complaint in order to be recoverable under the Act.
Note that s. 111(5) was a transitional provision that was repealed on February 20, 2017 in accordance with ss. 8(6) and 10(6) of Schedule 2 to the Stronger Workplaces for a Stronger Economy Act, 2014.
Prior to its repeal, its effect was to limit the application of the repeated contravention provision in s. 111(4) (also repealed) such that it applied in respect of wages that came due prior to February 20, 2015 in either of two ways:
However, it is Program policy that the limitations imposed by s. 111(5) continue to apply to repeated contraventions of the requirement to pay wages that became due before February 20, 2015, even if any associated orders are issued after February 20, 2017.
For example, s. 111(5)(a) applied so that a repeated contravention would be found where the employer had twice made prohibited deductions from the employee’s pay at nine months and three months prior to the date the complaint was filed, because both are s. 13 contraventions but are not also contraventions of any other provision of the Act. Under s. 111(5)(b), a repeated contravention would be found where, on one occasion, the employer failed to pay overtime pay (a contravention of s. 11 and s. 22) and on a second occasion, again failed to pay overtime pay (as they are both contraventions of s. 11 and s. 22). However, a repeated contravention would not be found where the employer failed to pay overtime pay on one occasion and failed to pay minimum wage on another because while they are both s. 11 violations, they are contraventions of s. 22 and s. 23 respectively.
Note that s. 111(6) was a transitional provision that was repealed on February 20, 2017 in accordance with ss. 8(6) and 10(6) of Schedule 2 to the Stronger Workplaces for a Stronger Economy Act, 2014.
Prior to its repeal, subsection 111(6) was effectively limited in its application to situations where a complaint or a subsequent complaint had been filed with respect to wages which were subject to the limitations on recovery set out in the repealed s. 111(3.1), which is in turn was subject to ss. 111(3.2) to (8) (also repealed). However, it is Program policy that s. 111(6) continues to apply to complaints from different employees regarding wages that became due before February 20, 2015, even if any associated orders are issued after February 20, 2017.
In other words, if a complaint has been filed and subsequent complaints are filed by different employees against the same employer alleging at least one of the same contraventions alleged in the first complaint and there are wages that came due prior to February 20, 2015, s. 111(6) provides that those wages will be subject to a six month recovery period, or 12 months in the case of repeated contraventions or vacation pay, preceding the date the first complaint was filed.
Section 111(6) must be read subject to s. 111(8), which limits the application of s. 111(6) to situations where the subsequent complaints are filed before the officer has made a determination with respect to that first complaint.
Because B's complaint was filed before the officer had issued an order or letter of refusal with respect to A's complaint, B's complaint will be treated as if it had been filed July 1, 2015. As a result, the officer could issue an order for the overtime pay due to both A and B on January 15, 2015 as well as the overtime pay that was due to B on July 15, 2014 because it was a repeated contravention under s. 111(4).
Note that s. 111(7) was a transitional provision that was repealed on February 20, 2017 in accordance with ss. 8(6) and 10(6) of Schedule 2 to the Stronger Workplaces for a Stronger Economy Act, 2014.
This provision is similar to the repealed s. 111(5), but it defined those situations in which the contraventions in different complaints (as compared to repeated contraventions with respect to a particular employee) would be considered to have arisen under the same provision of the Act (or identical or virtually identical provisions of the employees' contracts of employment) for the purpose of treating all the complaints as if they had been filed on the date the first complaint was filed as per s. 111(6) (also repealed). However, it is Program policy that s. 111(7) continues to apply to wages that became due before February 20, 2015, even if any associated orders are issued after February 20, 2017.
Like the repealed s. 111(5), this provision effectively applied only with respect to wages that came due prior to February 20, 2015.
The effect of s. 111(7) was to limit the application of s. 111(6) such that it applies in respect of wages that came due prior to February 20, 2015 in either of two ways:
For example, if employee A filed a complaint claiming that they had not been paid regular wages and employee B subsequently filed a complaint also alleging non-payment of wages, employee B's complaint would be treated as if it had been filed on the date employee A's complaint was filed. However, the contraventions would not be considered the same if employee A's complaint alleged that the employer failed to pay overtime pay (a contravention of s. 11 and s. 22) and employee B's complaint alleged a failure to pay minimum wage (a contravention of s. 11 and s. 23).
Finally, if both employee A and B alleged a failure to pay overtime pay (a contravention of s. 11 and s. 22), they would be considered the same contravention and employee B's complaint would be treated as if it had been filed on the date A filed their complaint.
Note that s. 111(8) was a transitional provision that was repealed on February 20, 2017 in accordance with ss. 8(6) and 10(6) of Schedule 2 to the Stronger Workplaces for a Stronger Economy Act, 2014.
Prior to its repeal, this provision restricted the application of s. 111(6) to situations where the subsequent complaint(s) is filed before the officer has issued an order with respect to the original complaint or sent a letter advising that complainant of the decision not to issue an order. Because s. 111(6) only applied with respect to wages that came due prior to February 20, 2015, s. 111(8) similarly applied in situations where employees who have filed a subsequent complaint are owed wages that were due prior to February 20, 2015. However, it is Program policy that s. 111(8) continues to apply to wages that became due before February 20, 2015, even if any associated orders are issued after February 20, 2017.
In other words, s. 111(6), which provided that the six-month/one-year limits on recovery run from the date the first complaint has been filed (in the event there are multiple complaints for substantially the same contravention) does not apply if the subsequent complaint(s) are received after the employment standards officer has issued an order or sent a letter advising the earlier complainant that the officer will not be issuing an order.
Despite the mandatory time limits on recovery set out in s. 111, it may be possible for the six/12-month time limits that apply with respect to wages that came due prior to February 20, 2015, as well as the two-year limitation on recovery that applies with respect to wages that came due on or after that date, to be extended in exceptional cases. The Court of Appeal in Halloran v. Sargeant, 2002 CanLII 45029 (ON CA) held that in the appropriate circumstances, the equitable doctrine of fraudulent concealment applies to relieve against statutory time limits on recovery.
In Halloran v. Sargeant, Mr. Halloran filed a claim for severance pay under the former ESA more than five years after his separation from his employer. The relevant provision of the former Employment Standards Act at that time, s. 82(2), had a two-year limitation on recovery; thus, the section, on its face, barred any recovery for Mr. Halloran as his severance pay would have become due more than five years before he filed his claim. The Court of Appeal held that the Ontario Labour Relations Board should have applied the equitable doctrine of fraudulent concealment in order to relieve against the two-year time limit. The Court of Appeal held that this doctrine was applicable because the employer, on separation, had represented to Mr. Halloran that an unreduced early pension without severance pay exceeded what Mr. Halloran was entitled to under provincial law. The Court found that Mr. Halloran relied on this representation but changed his mind and decided to file a claim under the former Employment Standards Act some years later after reading in the newspaper about the Court decision affirming that certain other employees of the company who had pursued Employment Standards Act claims after their separation were in fact entitled to severance pay. Fraudulent concealment necessary to suspend the operation of the limitation period need not, according to the Court, amount to deceit or fraud in the ordinary sense. There is no suggestion in the case that the employer was fraudulent in the ordinary sense of that word. The Court held that employers have an obligation to provide accurate information to employees and it was not "right or reasonable" for the employer to take the benefit of s. 82(2) where it had made a misrepresentation to the employee concerning his statutory rights and where the employee relied on that misrepresentation to his detriment. The Court held that this was sufficient to engage the fraudulent concealment doctrine.
The principles set out in Halloran v. Sargeant may apply to provide relief against the six-month/one-year and two-year limitation period in s. 111 to allow a claim that would otherwise be out of time where:
In determining whether the fraudulent concealment applies to allow recovery of a claim that on its face is time barred or which includes entitlements more than six/12 months or two years before the claim was filed, employment standards officers should inquire as to the reason for delay in filing:
It does not matter whether the employer’s misrepresentation is innocent, negligent or dishonest in order for the doctrine of fraudulent concealment to apply.
Subsection 112(1) of the Employment Standards Act, 2000 allows an employer and employee to enter into a settlement regarding a contravention or alleged contravention of the Employment Standards Act, 2000 by informing an employment standards officer in writing of the settlement and doing what they have agreed to do under it. Note that s. 112 as well as ESA Part XXII, s. 101.1 (and unlike ss. 120 and 129) apply only to settlements between an employer and employee and so cannot be used to settle a complaint that relates to a corporate director’s liability or to settle a director’s order to pay issued under ESA Part XXII, s. 106 or s. 107.
However, it should be noted that for the purposes of both s. 101.1 and s. 112 settlements in respect of Part XVIII.1, that a reference to an "employer" includes a reference to a client of a temporary help agency and a reference to an "employee" includes a reference to an assignment employee or prospective assignment employee.
Note as well that a settlement agreement may be made by an agent acting on behalf of the employer (e.g., a director of a corporate employer) or the employee. As a result, a director of the employer could, if acting as agent for the employer, enter into a settlement under s. 112 of a complaint against, or corporate order issued to, an employer. In that case, any proceedings other than a prosecution against both the employer and the corporate director would be terminated under s. 112(1)(d). See also ESA Part III, s. 7 for a discussion of the binding effect of an agreement or authorization made by an agent of the employee.
The other provisions of the Employment Standards Act, 2000 that allow for settlement agreements between the parties to an employment standards complaint are as follows:
However, s. 112 settlements are unique under the Employment Standards Act, 2000 in that they are not facilitated by a third party such as an employment standards officer or labour relations officer or a collector but are effected by the parties themselves, i.e., the employer and the employee.
The parties may enter into such an agreement before or after:
This provision clearly contemplates that the parties may enter into a settlement under s. 112 even after initiating an application for review. This intent is also apparent in ESA Part XXIII, s. 117(3), which specifically provides that where an employer applies for a review and the matter is settled under s. 112 or s. 120, monies held in trust shall be paid out in accordance with the settlement, subject to s. 112(6) or s. 120(6). The parties are not restricted to a settlement effected by a labour relations officer under s. 120.
Where a settlement has been entered into, any complaint filed by the employee respecting the contravention or alleged contravention is deemed to have been withdrawn, any order that may have been issued under ss. 74.14, 74.16, 74.17, 103, 104, 106 or 107 in respect of the contravention is voided and any application for review or a hearing under s. 116 that has been initiated respecting the contravention is terminated. However, a settlement under this section will have no impact on any prosecution that may have been commenced.
A settlement only settles the issues that the settlement document says it settles, and no more. For example, an employee filed a claim for vacation pay and termination pay. At no point — either in the claim form or afterwards, for example, during any discussion — was an issue of a minimum wage contravention raised. The employee and employer entered into a settlement whose terms specified that it was in settlement of the vacation pay and termination pay claims; it did not state that it was in settlement of all ESA issues that may have arisen during the course of the employment relationship up to the date of the settlement. The employee, after receiving the payment and wage statement from the employer due under the settlement, became aware that she hadn't been paid minimum wage. In this example, as the settlement did not cover the minimum wage issue, the claimant is able to pursue a minimum wage claim. The minimum wage issue would have been covered by the settlement only if:
Subsection 112(1) must be read subject to s. 112(8), which provides that where an employee demonstrates to the Ontario Labour Relations Board that tey entered into the settlement as a result of fraud or coercion, the settlement is void.
It should also be noted that the binding effect of the settlement and its impact on a complaint, order or proceeding is dependent on the parties to the settlement doing what they have agreed to do under it. For example, if the employer and employee have settled the matter with the agreement that a specific sum of money will be paid to the employee and such monies are not paid, this section will not apply and the matter will proceed as if there had been no settlement.
See also ESA Part XXIII, s. 120, which deals with settlements effected by a labour relations officer of matters raised in an application for review under ESA Part XXIII, s. 116.
Subsection 112(2) provides that clause 112(1)(c) which would otherwise void any order if the parties have made a settlement under s. 112(1) does not apply to a compliance order issued under ESA Part XXII, s. 108. In other words, if an employment standards officer has issued a compliance order, it will not be voided by a subsequent settlement.
This subsection precludes the parties from entering into a settlement that would allow the employer to effectively contract out of its obligations to comply with the Employment Standards Act, 2000 imposed by a compliance order. Subsection 112(2) is necessary because settlements under s. 112 may be made by the parties without the approval of the employment standards officer. Under s. 112(1) all that is required is that the parties inform the employment standards officer of the settlement.
Note that where a settlement is effected by a labour relations officer under ESA Part XXIII, s. 120, a compliance order may be voided. However, such settlements require the approval of the Director of Employment Standards as per s. 120(3).
This provision must be read in conjunction with s. 112(9), which provides that for the purposes of applying s. 112 with respect to ESA Part XVIII.1, any reference to an employer includes a reference to a client of a temporary help agency and any reference to an employee includes a reference to an assignment employee or a prospective assignment employee.
Subsection 112(3) provides that there is no settlement option where the officer has issued a notice of contravention under ESA Part XXII, s. 113. The notice of contravention allows an officer to assess a monetary penalty, as set out in O. Reg. 289/01, where the employer is found to have contravened the Employment Standards Act, 2000. The penalty imposed under the notice of contravention cannot be the subject of any settlement agreement because the parties to the notice of contravention are the Ministry and the employer, rather than the employee and the employer.
Subsection 112(4) allows the officer to pay the monies received on a settlement made under s. 112 directly to the employee or to the Director in trust.
This provision must be read in conjunction with s. 112(9) which provides that, for the purposes of applying s. 112 with respect to Part XVIII.1, any reference to an "employer" includes a reference to a client of a temporary help agency and any reference to an "employee" includes a reference to an assignment employee or a prospective assignment employee.
Subsection 112(5) provides that money collected by the employment standards officer with respect to an employee under the terms of a settlement in s. 112(1) and paid to the Director in trust, is to be paid by the Director to the employee.
This provision must be read in conjunction with s. 112(9) which provides that for the purposes of applying s. 112 with respect to Part XVIII.1, any reference to an "employer" includes a reference to a client of a temporary help agency and any reference to an "employee" includes a reference to an assignment employee or a prospective assignment employee.
See Delegation of Powers for information regarding the persons to whom the power to receive monies in trust has been delegated.
The Employment Standards Amendment Act (Temporary Help Agencies), 2009, S.O. 2009, c. 9, amended this provision effective November 6, 2009, to include a reference to fees paid pursuant to an order issued under s. 74.14. The Fair Workplaces, Better Jobs Act, 2017, S.O. 2017, c. 22 further amended this provision to provide for the recovery of a proportion of a collector’s fees and disbursements based on the amount the employee is entitled to receive under a settlement made under s. 112.
Note that wWhile this provision states that it is the Director who is entitled to the collector’s fees and disbursements, the Director may delegate collection activities to a collector and authorize the collector to collect the fees and disbursements under s. 127.
Clause 112(6)(a) establishes the Director’s entitlement to a proportionate amount for administrative costs, despite the fact that the order has been voided as a result of a settlement. Where there is a settlement of an order, administrative costs payable to the Director of Employment Standards will be a proportion of the administrative costs assessed under the order. The proportion is calculated as the amount paid to the employee under the settlement, divided by the amount assessed as owing to the employee under the order. For example, consider an order issued for $1,000 in wages plus a $100 administrative fee. The employer and employee subsequently enter into a settlement under s. 112 providing for a $500 payment to the employee. The proportion of wages paid under the settlement to the amount assessed under the order is one half. Therefore, the administrative fee payable to the Director would be one half of the $100 assessed under the order, or $50. See also the discussion of ESA Part XXIII, s. 117(3) and s. 120(6).
Clause 112(6)(b) establishes the Director’s entitlement to a proportionate amount for the collector’s fees and disbursements when a settlement is reached between an employer and employee after the order has been assigned to the collector and the collector has sought to collect the amount owing.
For example, consider an order issued for $1,000 in wages plus a $100 administrative fee that the collector is seeking to collect. Assuming the Director has authorized the collector to collect 20% of the order to pay in respect of the collector’s fees in accordance with s. 127(3), a collection fee of $220 (($1000 + $100) × 20%) would be added to the order. If the employer and employee entered into a s. 112 settlement in the amount of $800 (80% of the amount owing to the employee), the collector would be entitled to a proportional amount of the fee in the amount of $176 ($220 × 80% = $176), based on the settlement reached.
Note that this provision must be read in conjunction with s. 112(9) which provides that for the purposes of applying s. 112 with respect to Part XVIII.1, any reference to an "employer" includes a reference to a client of a temporary help agency and any reference to an "employee" includes a reference to an assignment employee or a prospective assignment employee.
Section 112(7) restricts the parties' ability to reach a settlement that would allow future contraventions of the Employment Standards Act, 2000. For example, although an employee may agree to accept a payment equivalent to straight pay for overtime hours worked in the past, the employee may not agree to work overtime in the future at straight time.
This provision must be read in conjunction s. 112(9) which provides that for the purposes of applying s. 112 with respect to Part XVIII.1, any reference to an "employer" includes a reference to a client of a temporary help agency and any reference to an "employee" includes a reference to an assignment employee or a prospective assignment employee.
Subsection 112(8) provides that a settlement entered into pursuant to s. 112 may be set aside where the employee can demonstrate to the Ontario Labour Relations Board that they entered into the settlement as a result of fraud or coercion. If the Board makes such a finding, the settlement is void, the employee’s complaint is deemed never to have been withdrawn, any order made with respect to the contravention or alleged contravention is reinstated and any proceeding that was terminated is resumed.
Only the Ontario Labour Relations Board has the authority to determine that an employee entered into a settlement as a result of fraud or coercion; officers do not have the authority to make that determination.
Note that s. 112(9) provides that, for the purposes of applying s. 112 with respect to Part XVIII.1, any reference to an "employer" includes a reference to a client of a temporary help agency and any reference to an "employee" includes a reference to an assignment employee or a prospective assignment employee.
In Dey v. Majestic Marble Import Ltd., 2016 CanLII 49544 (ON LRB), the claimant sought to void a settlement agreement regarding an Employment Standards Act, 2000 complaint. He claimed he was tricked into signing it because the employer told him that it was an order from the employment standards officer when it was not. The officer did not issue any orders against the employer in favour of the claimant. The claimant also argued that the settlement agreement should be void because of the way the employer treats its employees.
The Board cited J & Z Holdings Inc., 2005 CanLII 23310 (ON LRB), a previous decision in which the Board found that fraud requires an intent to defraud, and coercion includes persuading an unwilling person, by force, to sign a document. The Board also noted that while duress could be the basis for rendering an agreement void that does not mean that any form of pressure would make a decision void — the pressure would need to be undue or improper in the circumstances. Following the reasoning in J & Z Holdings Inc. that the evidence required for establishing fraud or coercion for the purposes of s. 112(8) must be very compelling, otherwise the effectiveness of the settlement process would be seriously undermined, the Board did not find any evidence of fraud or coercion.
The Board noted that the officer did not issue any orders against the employer, and accepted the employer’s evidence that they never misled the claimant regarding the nature of the settlement agreement. The Board also noted that an employer’s general behavior in other matters unrelated to the settlement is not a reason to void an otherwise valid settlement agreement. The Board concluded that there was no basis upon which it could reasonably conclude that the employer fraudulently tricked or coerced the claimant into signing the settlement agreement.
Section 112(9) specifies that for the purpose of applying s. 112 in respect of Part XVIII.1, any reference to an "employer" includes a reference to a client of a temporary help agency and any reference to the term "employee" includes a reference to an assignment employee or prospective assignment employee. For a discussion of the terms "assignment employee", "client" and "temporary help agency", see ESA Part I, s. 1(1). For a discussion of the definition of a "prospective assignment employee", see ESA Part XVIII.1, s. 74.8(4).
Section 113(1) permits an employment standards officer to issue a notice requiring payment of a specified penalty to a person that the officer believes has contravened the Employment Standards Act, 2000. This provision was amended by the Fair Workplaces, Better Jobs Act, 2017, S.O. 2017, c. 22, effective January 1, 2018.
The officer’s power to issue a notice of contravention is discretionary.
Note that the officer may issue a notice of contravention to any person the officer believes has contravened the Employment Standards Act, 2000. ESA Part I, s. 1 defines the term person. The word "person" indicates that the notice may be issued against persons other than an employer. For example, a notice of contravention could be issued against someone who is not the employer but who has custody of records or documents relevant to an investigation and who refuses to make them available for inspection contrary to ESA Part XXI, s. 91(8).
Section 113(1) must be read in conjunction with ss. 113(8) and (9) which provide that a notice of contravention may not be issued where the contravention is with respect to an employee who is represented by a trade union or where the contravention is committed by a director or officer of a corporate employer.
This subsection provides that the amount of the penalty is to be determined in accordance with the regulations. The penalty amounts are prescribed in O. Reg. 289/01 as follows:
For a contravention of ESA Part II, s. 2, ESA Part VI, s. 15, 15.1 or 16 identified to have occurred prior to January 1, 2018:
For a contravention of any other provision of the Employment Standards Act, 2000 identified to have occurred before January 1, 2018, the above listed penalties apply, but the penalty is multiplied by the number of employees affected.
For a contravention of ESA Part II, s. 2, ESA Part VI, s. 15, 15.1 or 16 identified to have occurred on or after January 1, 2018:
For a contravention of any other provision of the Act identified to have occurred on or after January 1, 2018, the above listed penalties apply, but the penalty is multiplied by the number of employees affected.
This section states that if a range has been prescribed as the penalty, the employment standards officer shall determine the amount of the penalty from within that range in accordance with any prescribed criteria. At the time of writing, no range has been prescribed and in accordance with s. 113(1.1) officers are therefore required to apply the penalties currently prescribed in O. Reg. 289/01.
This provision requires the officer to provide information concerning the nature of the contravention together with the notice of contravention. This provision is similar to the obligation to provide information regarding the amount owing under ESA Part XXII, s. 103(5), regarding an order to pay wages.
The notice of contravention and accompanying documents (such as a copy of any order issued with respect to the contravention, a covering letter, officer’s narrative and worksheet) must set out enough information that the person to whom the notice is issued will know the nature of the violation of the Employment Standards Act, 2000 and the information that gave rise to the officer’s belief that there is or was a contravention of the Employment Standards Act, 2000.
The language of the section is specific: the notice of contravention must contain or have attached to it the information required. The fact that the person to whom the notice is issued had knowledge previously of the nature of the violation does not relieve the officer of the onus of setting out this information as part of the notice of contravention.
Subsection 113(3) requires that a notice of contravention be served on the person against whom it is issued in accordance with ESA Part XXI, s. 95.
The service requirements set out under s. 113(3) for a notice of contravention are identical to those for all orders issued under the Employment Standards Act, 2000.
Section 113(5) provides that although the officer has issued a notice of contravention under s. 113(1), the contravention is deemed to have occurred only if the person to whom it was issued fails to make an application for a review of the notice of contravention within 30 days after the date of service of the notice, or, on a review of the notice, the Ontario Labour Relations Board finds that the person contravened the provision set out in the notice. In the latter case, this may occur whether the Board affirms the notice or amends it.
Section 113(6) creates an obligation to pay the penalty set out in the notice of contravention to the Minister of Finance, once the contravention is deemed to have occurred under s. 113(5).
It also requires payment of any collector’s fees and disbursements added to the amount of the penalty under ESA Part XXIV, s. 128(2). In other words, once the notice of contravention has been sent for collection, e.g., following the expiration of the period to apply for a review in ESA Part XXIII, s. 122(1), any authorized collector’s fees and disbursements are deemed to have been added to the amount set out in the notice of contravention.
Section 113(6.1) establishes the time period within which the payment of the penalty to the Minister of Finance for the deemed contravention must be made. In the event that the notice is not appealed, the payment is due 30 days after the notice was issued. In the event the notice is appealed, the payment is due 30 days after the Board has found that there was a contravention.
This section permits the Director of Employment Standards to publish the name of the person or business that a notice of contravention has been issued to, as well as a description of the contravention, the date of the contravention, and the penalty for the contravention.
Note that the publishing of this information is restricted to situations where a person is deemed to have contravened the Act in accordance with s. 113(5). Such contraventions only occur when the recipient fails to file for a review of the Notice with the Ontario Labour Relations Board within the period set out in ESA Part XXIII, s. 122(1). Or, where the person has filed for a review and the Board finds that they did in fact contravene the provision set out in the notice. As a result, the publishing of this information cannot simply occur once the notice was issued, but only after the application for review has been upheld or the period for review has expired.
This subsection clarifies that the authority to publish the information set out in s. 113(6.2) includes authority to publish on the Internet.
This subsection states that where the Director has published information under s. 113(6.2) that such publication is deemed to be permitted under the Freedom of Information and Protection of Privacy Act, R.S.O. 1990, c. F.31.
Section 113(7) provides that an officer may issue a notice of contravention even though an order has been issued under the following provisions:
An officer may also issue a notice of contravention if the person is or may be prosecuted for or convicted of an offence with respect to the contravention.
Section 113(8) provides that a notice of contravention may not be issued with respect to an employee who is represented by a trade union. In other words, an arbitrator (or the Board on a related employer issue) enforcing the ESA under ESA Part XXII, s. 99 through 101, or an employment standards officer, enforcing the Employment Standards Act, 2000 in a case where the Director has exercised their discretion under ESA Part XXII, s. 99(6), would not be able to issue a notice of contravention.
Section 113(9) provides that this section does not apply with respect to a contravention of the Employment Standards Act, 2000 by a director or officer of an employer that is a corporation. In other words, neither an employment standards officer nor the Board could issue a notice of contravention for a violation of the Employment Standards Act, 2000 by a director or officer of a corporate employer.
This subsection was amended by the Employment Standards Amendment Act (Temporary Help Agencies), 2009, S.O. 2009, c. 9, effective November 6, 2009 to include a reference to orders to recover fees under s. 74.14.
Section 114(1) establishes a two-year limitation period on the Ministry of Labour’s ability to issue an order for wages, fees or compensation or a notice of contravention. As no limitation is imposed with respect to an employment standards officer’s ability to issue an order for reinstatement, an officer may exercise their discretion to issue an order for reinstatement more than two years after a complaint was filed or an inspection commenced. However, it is Program policy that officers should generally not issue an order for reinstatement beyond the two years, to avoid putting employees who would be beneficiaries of such an order in a better position than employees who would be beneficiaries of an order for compensation, fees or wages.
Because this is a discretionary matter, however, officers should be prepared to consider any arguments that an order for reinstatement should be issued that might be put forward notwithstanding the passage of two years. It may be that in exceptional cases, there are good reasons for issuing a reinstatement order after two years have passed.
It should also be noted that there is no limitation period with respect to the officer’s ability to issue an order for compliance. As a result, an officer may exercise their discretion to issue an order for compliance more than two years after a complaint was filed or an inspection commenced. Because this is a discretionary matter, officers should be prepared to consider any arguments that an order for compliance should be issued notwithstanding the passage of two years. However, it is Program policy that officers should generally not issue an order for compliance where the employer is currently operating in compliance with the Employment Standards Act, 2000.
The two-year period for issuing an order for wages, fees or compensation or a notice of contravention commences with the following:
This provision must be read in conjunction with s. 114(6) which provides that, for the purposes of applying s. 114 with respect to ESA Part XVIII.1, any reference to an employer includes a reference to a client of a temporary help agency and any reference to an employee includes a reference to an assignment employee or a prospective assignment employee.
Section 114(2) creates an exception to the rule in s. 114(1)(a) which provides that the two-year limitation period commences on the date the employee filed their complaint. Under s. 114(2), if two or more employees file complaints with respect to substantially the same contravention as defined in ESA Part XXII, s. 115, the date that the first employee filed their complaint will be the start date for the two-year limitation period, subject to s. 114(3).
For example, if employee A filed a complaint regarding overtime pay on December 31, 2001 and employee B subsequently filed a complaint for overtime pay on January 15, 2002, the employment standards officer will be required to issue an order to pay wages or notice of contravention with respect to either or both employee A and B on or before December 30, 2003.
This provision must be read in conjunction with s. 114(6) which came into force on November 6, 2009. Section 114(6) provides that, for the purposes of applying s. 114 with respect to ESA Part XVIII.1, any reference to an employer includes a reference to a client of a temporary help agency and any reference to an employee includes a reference to an assignment employee or a prospective assignment employee.
Section 114(3) creates an exception to the rule in s. 114(2), which provides that if two or more employees file complaints with respect to substantially the same contravention as defined in ESA Part XXII s. 115, the date that the first employee filed their complaint will be the start date for the two-year limitation period for issuing, amending or rescinding an order to pay wages, fees or compensation or notice of contravention in respect of not only the first complaint but the subsequent complaint as well.
Under s. 114(3), if the employment standards officer had already issued an order or advised the first complainant that they were refusing to issue an order before the subsequent complaint was filed, an order for wages, fees or compensation or a notice of contravention may be issued with respect to the subsequent complaint (even though it concerns substantially the same contravention as the first complaint) within two years of the date the subsequent complaint was filed.
Note that this provision must be read in conjunction with s. 114(6) which provides that, for the purposes of applying s. 114 with respect to ESA Part XVIII.1, any reference to an employer includes a reference to a client of a temporary help agency and any reference to an employee includes a reference to an assignment employee or a prospective assignment employee.
It should be noted that s. 114(3) does not apply if the officer has issued only a notice of contravention (i.e., has not issued an order) with respect to A's complaint, prior to B filing a complaint for substantially the same contravention. Therefore, although the officer has issued a notice of contravention with respect to A's complaint before B's complaint was filed, the limitation period on the officer’s ability to issue an order to pay wages, fees or compensation with respect to B's complaint is still the two-year period running from the date A's complaint was filed.
This subsection was amended by the Employment Standards Amendment Act (Temporary Help Agencies), 2009, which came into force on November 6, 2009, to include a reference to orders to recover fees under ESA Part XVIII.1, s. 74.14.
This provision must be read in conjunction with s. 114(6) which provides that, for the purposes of applying s. 114 with respect to ESA Part XVIII.1, any reference to an employer includes a reference to a client of a temporary help agency and any reference to an employee includes a reference to an assignment employee or a prospective assignment employee.
Section 114(4) states that the officer shall not amend or rescind their order to pay wages, fees or compensation after the two-year limitation period in s. 114(1) unless the consent of the employer to whom it was issued and the affected employee(s) is first obtained.
Note that s. 114(4) does not provide for the extension of the two-year limitation for amending or rescinding an order issued against anyone other than an employer or a client of a temporary help agency per s. 114(6). As a result, an order against a corporate director issued under ESA Part XXII, s. 106 or s. 107 could not be amended or rescinded after the two-year limitation period.
The authority for the officer to amend or rescind an order prior to the expiry of the limitation period springs from the Legislation Act, 2006, S.O. 2006, c. 21, Sched. F, which states:
An example of where this section might be applicable is where, in a large and complex case, the employer, the officer, and the employees all agree that the quality of the investigation would be better if the officer carried it on past the two-year time limit. In such a case, with the agreement of the parties, an order could be issued for the amount that was already determined and then amended (in accordance with the subsequent portion of the investigation) after the two-year limit expired. Of course, in such a case, it would be advisable for the officer to obtain the necessary consents before the two-year period expired.
This section is similar to s. 114(4). It imposes a two-year time limit on the amendment or rescission of a notice of contravention issued under ESA Part XXII, s. 113 except where the officer has the consent of the employer against whom the notice was issued.
This provision must be read in conjunction with s. 114(6) which came into force on November 6, 2009. Section 114(6) provides that, for the purposes of applying s. 114 with respect to ESA Part XVIII.1, any reference to an employer includes a reference to a client of a temporary help agency and any reference to an employee includes a reference to an assignment employee or a prospective assignment employee.
This provision was introduced by the Employment Standards Amendment Act (Temporary Help Agencies), 2009 which came into force on November 6, 2009.
Section 114(6) specifies that when s. 114 is applied with respect to ESA Part XVIII.1, any reference to an employer includes a reference to a client of a temporary help agency and any reference to the term employee includes a reference to an assignment employee or prospective assignment employee. For a discussion of the terms assignment employee, client and temporary help agency, see ESA Part I, s. 1(1). For a discussion of the definition of prospective assignment employee see ESA Part XVIII.1, s. 74.8(4).
Section 115(1) defines the term "substantially the same" as it is used in ESA Part XXII, s. 114(2). Section 114(2) provides that where more than one employee has filed a complaint about substantially the same contravention, the two-year limitation period on issuing, amending and rescinding an order for wages, fees or compensation begins to run on the date the first complaint was filed, subject to ESA Part XXII, s. 114(3).
Section 115(1) provides that contraventions will be considered to be substantially the same where the employees are entitled to recover money for contraventions that are violations of the same provision of the Employment Standards Act, 2000 or the regulations or identical or virtually identical provisions of the employees' employment contracts. However, this subsection must be read subject to s. 115(2).
This provision must also be read in conjunction with s. 115(1.1) which came into force on November 6, 2009. Section 115(1.1) provides that, when s. 115(1) is applied with respect to ESA Part XVIII.1, any reference to an employer includes a reference to a client of a temporary help agency and any reference to an employee includes a reference to an assignment employee or a prospective assignment employee.
This provision was introduced by the Employment Standards Amendment Act (Temporary Help Agencies), 2009, S.O. 2009, c. 9, which came into force on November 6, 2009.
Section 115(1.1) provides that when s. 115(1) is applied with respect to a provision under ESA Part XVIII.1, any reference to an employer includes a reference to a client of a temporary help agency and any reference to an employee includes a reference to an assignment employee or a prospective assignment employee. For a discussion of the terms assignment employee, client and temporary help agency, see ESA Part I, s. 1(1). For a discussion of the definition of prospective assignment employee, see ESA Part XVIII.1, s. 74.8(4).
Section 115(2) provides that where the contraventions are the same only in that they are a contravention of the payment of wages provision in ESA Part V, s. 11 or the prohibition against deductions from wages in ESA Part V, s. 13, they will not be treated as substantially the same.
As a result, s. 114(2), which allows the limitation period on issuing, amending or rescinding an order for wages, fees or compensation, or a notice of contravention with respect to more than one complaint, to run from the date the first complaint is filed (if subsequent complaints are for substantially the same contraventions) does not apply if the contraventions are substantially the same only because they are all contraventions of ESA Part V, s. 11 and 13.
In this example, employee A's complaint and employee B's complaint would not be treated as substantially the same. Therefore, the limitation period for issuing, amending or rescinding an order or notice of contravention would end on October 31, 2011, with respect to employee A's complaint and on November 30, 2011, with respect to employee B's complaint.
Part XXIII of the Employment Standards Act, 2000 is subdivided into four sections. The first section consists of sections 116 to 120 and sets out the review process for orders for wages, compensation or reinstatement, orders against directors and compliance orders, as well as the review process for a refusal to issue an order for wages, compensation or reinstatement or compliance. It also provides for the settlement of matters referred to the Ontario Labour Relations Board ("OLRB" or the "Board") by labour relations officers. The second section consist of s. 121, which sets out the process for referrals to the Board by the Director of Employment Standards for a hearing to determine whether there has been a contravention of ESA Part XIII Benefit Plans. The third section consists of s. 122, which sets out the review process for Notices of Contravention. The fourth section consists of ss. 123 and 124, which set out general provisions respecting the Board, including the non-compellability of Board members, the registrar and Board employees to give evidence in civil and administrative proceedings, and the termination and re-institution of proceedings before the Board.
This provision was introduced by the Employment Standards Amendment Act (Temporary Help Agencies), 2009, S.O. 2009, c. 9, which came into force on November 6, 2009.
Section 115.1 establishes that any reference to an employee in Part XXIII of the Employment Standards Act, 2000 (i.e., ss. 116 to 124) includes a reference to an assignment employee or a prospective assignment employee. For a discussion of the definition of "assignment employee", see ESA Part I, s. 1(1). For a discussion of the meaning of "prospective assignment employee", see ESA Part XVIII.1, s. 74.8(4).
This provision was necessary to make Part XXIII compatible with ESA Part XVIII.1.
Subsection 116(1) sets out the entitlement to a review of an order issued under the following sections:
This subsection provides to a person against whom an order has been issued a right to a review of the order if the person applies in writing for a review and:
Note that while orders to pay compensation, like orders to pay wages or recover fees, may cover more than one employee, the amount that must be paid into trust or covered by an irrevocable letter of credit in the case of a compensation order remains at $10,000 regardless of whether the order covers one or several employees.
Note that under s. 116(4), there is a 30-day time limit for applying for a review. Under s. 116(5), the Ontario Labour Relations Board may extend this time limit.
If an applicant for review wishes to provide an irrevocable letter of credit in favour of the Director of Employment Standards rather than paying an amount to the Director in trust in accordance with s. 116(1)(b) or (c), the letter of credit must be acceptable to the Director. While the Director may consider other factors, generally speaking the Director will find a letter of credit to be acceptable if:
An information sheet about letters of credit and a template letter of credit that employers may wish to use are available on the Ministry's website.
If an employer believes there are good reasons why the Director should consider a letter of credit to be acceptable despite it not meeting the above criteria, those reasons should be provided to the Director in writing and the Director will consider them. Note that s. 116(1) indicates that a letter of credit must be irrevocable — the Director has no authority to accept a letter of credit that is not irrevocable.
While a director of a corporate employer against whom an order to pay has been issued under ESA Part XXII, s. 106 or s. 107 may apply to have the order reviewed by the Board, there is no requirement that the amount of such an order be paid to the Director in trust or that a letter of credit be provided to the Director. Note also that in the case of a compliance order issued under ESA Part XXII, s. 108, because such an order does not require any payment, the person against whom the order was issued may apply to have the order reviewed by the Board without paying any amount to the Director in trust or providing a letter of credit.
Section 116(2) was amended by the Employment Standards Amendment Act (Temporary Help Agencies), 2009, S.O. 2009, c. 9, effective November 6, 2009 to include references to orders issued under Part XVIII.1.
Section 116(2) establishes the right of an employee to request a review an order in respect of themselves that was issued under:
See s. 116(3) for the right of an employee to review an employment standards officer's refusal to issue certain orders. Such employees include both complainants and non-complainants who are entitled to monies in accordance with the order.
The application for review must be made in writing and must be made within the 30-day period set out in s. 116(4). The requirement that the application for review be in writing is identical to that requirement in s. 116(1). This section should also be read in conjunction with s. 116(5), which allows the Board to extend the time for applying for a review if it considers it appropriate to do so. If an application is made after the 30-day time limit and if an extension is either not requested or not granted, the Board will dismiss the application.
Employees have no entitlement to a review of an order issued against a director under ESA Part XXII, s. 106 or s. 107. Likewise, employees have no entitlement to a review of a compliance order issued under ESA Part XXII, s. 108.
Note that on November 6, 2009, ESA Part XXIII, s. 115.1 came into force. It provides that any reference to an employee in Part XXIII, including s. 116, includes a reference to an assignment employee or a prospective assignment employee.
Section 116(3) was amended by the Employment Standards Amendment Act (Temporary Help Agencies), 2009, S.O. 2009, c. 9, effective November 6, 2009 to include references to orders issued under Part XVIII.1.
Subsection 116(3) provides employees who have filed a complaint alleging a contravention of the Act to review the employment standards officer's decision not to issue an order under:
See s. 116(2) for the right of an employee to review certain orders that have been issued. The application for a review must be made in writing within the 30-day period set out in s. 116(4). The 30-day time period applies where an employment standards officer refuses to issue an order, as well as where there is a deemed refusal to issue an order under ESA Part XXII, s. 110(2).
The obligation to serve a letter advising a person of a refusal to issue an order is set out in ESA Part XXII, s. 110. Where there is a deemed refusal to issue an order under s. 110(2) because no order or refusal to issue an order is made within the two-year period from the date the complaint was filed, the letter advising the person of the refusal is deemed to have been served on the last day of the second year. This provision exists so that in the rare and unfortunate circumstance where the officer has neither issued an order nor refused to issue an order within the two-year period, the employee will still have the right to apply to have the matter put before the Board.
A refusal to issue an order has been held to include a situation where the officer rescinded an order previously made.
This subsection should also be read in conjunction with s. 116(5), which allows the Board to extend the time for applying for a review if it considers it appropriate to do so. If an application is made after the 30-day time limit and if an extension is either not requested or not granted, the Board will dismiss the application.
Non-complainants have no right of a review under this section. They do, however, have the right to file a complaint for investigation by an employment standards officer and may apply for a review of that officer's determination.
An employee, whether a complainant or non-complainant, has no right to a review of an officer's refusal to issue an order under ESA Part XXII, s. 106 or s. 107 against a director of a corporate employer. This is consistent with s. 116(2), which precludes an employee from seeking a review of an order against a director issued under s. 106 or s. 107.
Note that on November 6, 2009, ESA Part XXIII, s. 115.1 came into force. It provides that any reference to an employee in Part XXIII, including s. 116, includes a reference to an assignment employee or a prospective assignment employee.
All orders issued under the Act must be served in accordance with ESA Part XXI, s. 95. Likewise, where the Act requires an officer to notify a person that an order has been issued, the requisite letter must also be served in accordance with s. 95. Lastly, a letter advising of the refusal to issue an order under ESA Part XVIII.1, ss. 74.14, 74.16, 74.17 or ESA Part XXII, ss. 103, 104, and 108 must also be served in accordance with s. 95. The following sections establish that service must comply with s. 95:
Section 116(5) was amended by the Employment Standards Amendment Act (Temporary Help Agencies), 2009 effective November 6, 2009 to include references to orders to recover fees issued under ESA Part XVIII.1, s. 74.14.
Section 116(5) provides that the Board may extend the 30-day time limit for applying for a review set out in s. 116(4) if it considers it appropriate to do so. This discretion is subject to two conditions:
The first condition ensures that the Board does not extend the time for applying for a review if, after the monies assessed as owing under the order had been paid into trust, the Director of Employment Standards had already paid those monies out to the employee(s). The second condition is new under the Employment Standards Act, 2000. It ensures that where the monies were not paid into trust within the 30-day time period for applying for a review and the Ministry has subsequently sent the file out for collection, a late application for review is not granted unless the collector's fees and disbursements have been added to the amount of the order and have been paid.
The Board has ruled that it will not consider a request for an extension by an employer or director unless they have paid into trust the monies directed by the order to pay, or provided the Director of Employment Standards with an acceptable, irrevocable letter of credit — see for example Nebenaigoching Heritage Inc. v. Jackson, 2014 CanLII 8971 (ON LRB). Because ESA Part XXIV, s. 128(2) deems collector's fees and disbursements (if any) to be included in the amount of the order, it is anticipated that the Board would likewise not consider a request for an extension unless the amount of any collector's fees or disbursement have also been paid into trust, or are reflected in an irrevocable letter of credit.
Note that on November 6, 2009, ESA Part XXIII, s. 115.1 came into force. It provides that any reference to an employee in Part XXIII, including s. 116, includes a reference to an assignment employee or a prospective assignment employee.
Section 116(6) requires the Board to hold a hearing for the purposes of the s. 116 review, subject only to ESA Part XXIII, s. 118(2). Section 118(2) allows the chair of the Board to make rules that allow the Board not to hold a hearing to expedite decisions about the Board's jurisdiction. At the time of writing, no such rule had been made. Aside from this exception, the language of the section is mandatory: the Board shall hold a hearing. This means that the Board must hold a hearing into a s. 116 review application as long as the conditions of application are met, i.e., the 30-day time limit and payment of the amount ordered into trust or guaranteed by an irrevocable letter of credit.
In Jannock Limited and Armtec Inc. o/a Jannock Steel Fabricating Company et al. v. United Steelworkers of America et al. (November 27, 1995), ESC 3506A (Randall), a case under the former Employment Standards Act, an employer argued that the powers exercised by the referees under the old s. 68 employer-review section were judicial and appellate in nature and offended s. 96 of the Constitution Act, 1867, and were therefore ultra vires or void. The employer's argument was rejected by the referee on the basis that although the referees were performing judicial or quasi-judicial functions, they did so as a necessarily incidental aspect of the broader policy goal of providing minimum standards of protection. The referee also held that the hearing under s. 68 was in the nature of a review, rather than an appeal. It continues to be the Ministry's view that the hearings under s. 116 are in the nature of a review rather than an appeal.
Section 116(7) was amended by the Employment Standards Amendment Act (Temporary Help Agencies), 2009 effective November 6, 2009 to include references to orders under Part XVIII.1.
Section 116(7) identifies those who are considered to be parties to the s. 116 review, and empowers the Board to add relevant persons as parties to the review. Having the status of a party to a hearing means that one is bound by the decision of the Board. Also, only parties to the hearing can apply for judicial review of the Board's decision.
The fact that the Director of Employment Standards is automatically made a party to the hearing may impact on the relevance of the doctrine of issue estoppel in applications for review. Issue estoppel is a doctrine that parties sometimes use to prevent issues that have already been determined in a prior proceeding from being re-litigated. For example, an employer may try to raise the doctrine if an employee files an Employment Standards Act, 2000 complaint under the pregnancy leave provisions after she has already received an unfavourable decision on her application to the Human Rights Tribunal of Ontario.
It may be that, because of s. 116(7), the doctrine of issue estoppel may never apply to applications for review. This is because in order for issue estoppel to apply, the issues and the parties to the prior proceeding must be the same as the issues and the parties to the proceedings in which the issue estoppel is raised. By virtue of s. 116(7), the parties to an application for review include the Director of Employment Standards. Because it is unlikely that the Director will have been a party to any prior proceedings (for example, a human rights complaint), the doctrine of issue estoppel could not apply — see Garner Travel International Inc. #744797 o/a Goliger's Travel v. Parsonage (December 11, 1998), 3422-97-ES (ON LRB), which was a case under the former Employment Standards Act.
Note that this provision must be read in conjunction with ESA Part XXIII, s. 115.1 which provides that any reference to an employee in s. 116 includes a reference to an assignment employee or a prospective assignment employee.
Section 116(8) states that the Board must give the parties to the hearing a full opportunity to present their evidence and submissions.
This section should be read subject to ESA Part XXIII, s. 118(2), which allows the chair of the Board to make rules regarding certain matters that may limit the extent of the Board's obligation to give full opportunity to the parties to present their evidence and submissions.
Section 116(9) states that Board shall determine its own practice and procedure with respect to a review under this section.
This section should be read in conjunction with ss. 116(6), (7) and (8), which require the Board to hold a hearing, permit parties to be added and, subject to ESA Part XXIII, s. 118(2), give parties full opportunity to present their evidence and make submissions.
This provision was amended by the Employment Standards Amendment Act (Temporary Help Agencies), 2009, S.O. 2009, c. 9, effective November 6, 2009 to include a reference to orders to recover fees issued under s. 74.14.
Subsection 117(1) indicates that s. 117 applies where money has been paid to the Director in trust with respect to an application for review of an order issued under s. 74.14 (for fees), s. 75.16 (for compensation (temporary help agency), s. 75.17 (order re: client reprisal), s. 103 (for wages) or s. 104 (for compensation).
This provision is similar in part to the corresponding section (s. 70(1)) of the former Employment Standards Act. Section 117(2) requires that any money paid to the Director in trust in the context of a s. 116 application for review of an order for wages, fees or compensation be put into an interest-bearing account pending the review. This includes the money paid in respect of wages, fees and compensation, as well as the administrative costs.
For information regarding the delegation of the Director's non- discretionary power to receive monies into trust under this section, see Delegation of Powers in the Manual for further information.
This provision is similar in part to the corresponding sections (s. 69.1(6), 70(3) and s. 70(4)) of the former Employment Standards Act. Section 117(3) requires the Director of Employment Standards to distribute, in accordance with the terms of a settlement of a s. 116 (application for review) proceeding at the Ontario Labour Relations Board, any money that is held in trust subject to provisions regarding the payment of administrative costs as set out in ss. 112(6) and 120(6). Section 117(3) applies whether the settlement is facilitated by an employment standards officer under s. 112 or by a labour relations officer under s. 120.
The distribution of administrative costs on a settlement under s. 117(3) is subject to s. 112(6) and s. 120 (6). These sections provide that where there is a settlement of an order, the Director is still entitled to be paid a proportion of the administrative costs assessed under the order. That proportion is calculated as the amount paid to the employee under the settlement, divided by the amount assessed as owing to the employee under the order. For further discussion of s. 112(6) and s. 120(6) see ESA Part XXII and ESA Part XXIII.
Section 117(3) also requires the Director to pay interest on the monies paid out under the settlement that were held in trust (wages, compensation and administrative costs), at the rate and calculated in the manner determined by the Director under s. 88(5).
This section is similar in part to the corresponding section (s. 70(1)) of the former Employment Standards Act. Section 117(4) sets out the Director's obligation to pay out the funds in trust once the Board renders its decision. The Director must distribute the funds as the Board's decision specifies. Subject to an order from the Board to the contrary, it is the general policy of the Trust Funds Unit of the Employment Practices Branch to hold the monies in trust for 30 days following the date of receipt of the decision, in case there is a judicial review and stay application by one of the parties.
The section further requires that the money be paid out according to the Board's decision, along with interest on the money at the rate and calculated in the manner determined by the Director under s. 88(5).
This provision is similar to the corresponding section (s. 68(11)) of the former Employment Standards Act.
Section 118(1) allows the chair of the Board to make rules governing the Ontario Labour Relations Board's practice and procedure in s. 116 cases, and to provide for forms to be used.
The Board published new Rules of Procedure governing all matters that arise before it, including the former Employment Standards Act cases, in August 1999. The rules were subsequently amended and were also made applicable to cases under the Employment Standards Act, 2000.
Among other things, rules made pursuant to this section:
Where the Director fails to provide the information required under paragraph vii, in the way required by these Rules, the Board may be satisfied that the Director has not paid to the employees the wages or compensation that were the subject of the Order and the Board may be satisfied that any collector's fees or disbursements that may have been added to the amount of an Order under s. 128(2) of the Employment Standards Act, 2000 were paid by the person to whom the Order was issued.
This provision is essentially unchanged from the corresponding section (s. 68(12)) of the former Employment Standards Act.
This section qualifies the requirements of ss. 116(6) and (8) for the Board to hold a hearing and give full opportunity to the parties to present their evidence and make submissions in a s. 116 review application. It provides that the chair of the Board can make rules to expedite decisions about the Board's jurisdiction that exempt those requirements. At the time of writing, no such rules had been made.
This provision is similar to s. 68(13) of the former Employment Standards Act. It was amended by the Good Government Act, 2006, S.O. 2006, c. 19, effective June 22, 2006 to provide that only those rules made to expedite decisions about the Board's jurisdiction require an order of the Lieutenant Governor in Council to come into force.
Previously s. 118(3) required that all rules made by the chair of the Board under s. 118, including rules made under s. 118(1) regarding the Board's practice, procedure and exercise of its powers and providing for forms and their use, came into force on a date determined by the Lieutenant Governor in Council.
This section is essentially the same as the corresponding section (s. 68(14)) of the former Employment Standards Act.
This section states that rules made by the chair of the Board under s. 118 apply, notwithstanding the requirements of the Statutory Powers Procedure Act, R.S.O. 1990, c. S.22 ("SPPA").
The SPPA (as amended) Part 1 ''Minimum Rules for Proceedings of Certain Tribunals'', s. 3(1) states that, subject to s. 3(2), Part I applies to proceedings ''by a tribunal in the exercise of a statutory power of decision conferred by or under an Act of the Legislature, where the tribunal is required by or under such Act or otherwise by law to hold or to afford to the parties to the proceeding an opportunity for a hearing before making a decision.'' In effect, the Part I SPPA rules for holding and conducting a hearing, do not apply if they conflict with the Board's rules.
This provision is essentially the same as the corresponding section (s. 68(15)) of the former Employment Standards Act.
Section 118(5) simply states that rules made by the chair of the Board under s. 118 are not regulations within the meaning of Part III (Regulations) of the Legislation Act, 2006, S.O. 2006, c. 21, Sched. F.
Section 119(1) states that s. 119 sets out the Ontario Labour Relations Board's powers with respect to a review under ESA Part XXIII, s. 116.
Section 119(2) provides that when there are multiple parties with the same or substantially the same interest in a hearing, the Board may designate one or more of the parties as representatives for the entire group.
This section indicates that the chair or a vice-chair of the Board constitutes a quorum and is sufficient for the exercise of all the jurisdiction and powers of the Board under ESA Part XXIII, s. 116.
Section 119(4) empowers the Board to order a person (which could include a trade union) to post notices that the Board considers appropriate, even if the person is not a party to the review. See the discussion of the definition of person in ESA Part I, s. 1. For example, where a director appeals an order issued under ESA Part XXII, s. 106, the Board could require the employer to post a notice even if the employer was not a party to the review hearing.
Section 119(5) provides that where a person has been required to post a notice under s. 119(4), it must be posted and kept posted in a conspicuous place or places in or upon the premises of that person where it is likely to come to the attention of other persons having an interest in, or who are affected by, the review.
Together with s. 119(7), this section sets out the Board's powers to arrive at a particular decision respecting an application for review.
The Board has all of the powers of an employment standards officer: it can make any order that an officer can make, and can order the production of records or documents that the officer could have ordered produced for inspection. In applications to review an order, the Board can amend, rescind or affirm the order, or issue a new order. Because the Board has all the powers of an officer, it is the Program's position that the Board can amend an order by increasing or decreasing the amount of the order. In applications to review the refusal to issue an order, the Board can issue an order or affirm the refusal.
The Board may also reconsider one of its own decisions — see the discussion at ESA Part XXIII, s. 118(1).
Section 119(7) more particularly spells out the Board's powers to issue a decision on a review as set out in s. 119(6).
This section allows the Board to, during a review, direct one of its labour relations officers to examine records or conduct any other inquiries that the Board feels are necessary for the review. The Board is explicitly prohibited from directing an employment standards officer to do any of those things.
This section should be read in conjunction with s. 119(9), which states that ESA Part XXI, ss. 91 and 92, whichset out the powers of an employment standards officer as well as the compliance required of people involved in an investigation by an employment standards officer, apply with respect to labour relations officers directed under s. 119(8).
Section 119(9) states that ESA Part XXI, ss. 91 and 92, which set out the powers of employment standards officers and the compliance required of people involved in an investigation by an employment standards officer, apply to labour relations officers who are directed to examine records or conduct other inquiries under s. 119(8).
Section 119(10) was amended by the Employment Standards Amendment Act (Temporary Help Agencies), 2009, S.O. 2009, c. 9, effective November 6, 2009 to include a reference to orders to recover fees issued under s. 74.14.
Section 119(10) states that s. 119(11) applies if, during a review under ESA Part XXIII, s. 116, the Board finds any portion of the wages, fees or compensation is owing to the employee, or the parties agree such a portion is owing to the employee.
Note that on November 6, 2009, ESA Part XXIII, s.115.1 came into force. It provides that any reference to an employee in Part XXIII, including s. 119, includes a reference to an assignment employee or a prospective assignment employee.
Section 119(11) provides that where, under s. 119(10), the Board finds that a specified amount of wages, fees or compensation is owing to the employee, or the parties agree such an amount is owing to the employee, the order shall be affirmed to that extent or an order issued to that extent. As a result, that specified amount of wages, fees or compensation may be paid out before the hearing ends, or even before it begins.
Note that on November 6, 2009, ESA Part XXIII, s. 115.1 came into force. It provides that any reference to an employee in Part XXIII, including s. 119, includes a reference to an assignment employee or a prospective assignment employee.
This section is designed to enable moneys to be paid out to an employee who is entitled to it as soon as possible. Note that the language of this section is mandatory: the Board is obliged to issue or affirm the order to a certain extent without delay. See Northern Air Systems v. MacLean, 1999 CanLII 19493 (ON LRB), where the Board observed that none of the issues raised in the employer's written application would disentitle the employee to termination pay and, before a hearing was convened, directed that the monies held in trust be released to the employee in accordance with s. 68(23) of the former Employment Standards Act.
Section 119(12) was amended by the Employment Standards Amendment Act (Temporary Help Agencies), 2009, S.O. 2009, c. 9 effective November 6, 2009 to include a reference to orders to recover fees issued under ESA Part XVIII.1, s. 74.14.
Section 119(12) allows the Board to order employers, clients of temporary help agencies or directors to pay interest on any money they are ordered to pay in respect of an order for wages, fees or compensation at the rate and calculated in the manner determined by the Director under ESA Part XXI, s. 88(5).
Section 119(13) provides that the results of an application for review under ESA Part XXIII, s. 116 are final and binding. However this section must be read subject to the right to apply to the Board for reconsideration of that decision or to a judicial review of the decision in accordance with s. 119(14). See the discussion regarding reconsideration requests at ESA Part XXIII, s. 118(1).
Section 116(7) specifies upon whom the results of a review application are binding: the parties to the hearing, including parties whom the Board specified as such. Decisions under ESA Part XXIII, s. 116 have technically, then, no binding effect on anyone who was not a party. Furthermore, where the Board hears subsequent cases with different parties than those in the original hearing, the Board is not bound by the original decision, although it may have some persuasive value.
This provision codifies the right to apply for a judicial review and establishes the standard of review. It provides that s. 119(13), which provides that the Board's decisions are final and binding, does not limit a court's ability to review a decision of the Board but also provides that the Board's decision with respect to the interpretation of the Act cannot be overturned unless it was unreasonable.
In Halloran v. Sargeant, 2002 CanLII 45029 (ON CA), the Ontario Court of Appeal held that a referee's decision should not be overturned unless it is unreasonable. The unreasonable standard is a somewhat less deferential standard, however, the decision in question does not have to be correct in law.
In s. 119(4), the Legislature has expressly stated that a decision of the Ontario Labour Relations Board concerning the interpretation of the Act should not be overturned unless it is unreasonable. Interestingly, the Ontario Court of Appeal in the National Automobile, Aerospace Transportation and General Workers Union of Canada (C.A.W. — Canada) Local No. 27 v. London Machinery Inc., 2006 CanLII 8711 (ON CA) ruled that the decision of an arbitrator concerning the interpretation of the Act should not be overturned unless it is patently unreasonable. In so ruling, the Court did not discuss s. 119(4).
Several court decisions have addressed the issue of premature judicial review applications; that is, when a party has gone directly to judicial review after the officer's decision, rather than first applying for a review of the decision under the former Employment Standards Act. All of the following decisions dealt with the former Employment Standards Act and before jurisdiction over reviews was transferred to the Ontario Labour Relations Board, but it is anticipated that these principles will apply to the Employment Standards Act, 2000 as well.
The courts have said that employers could not circumvent the former s. 68 review process (now ESA Part XXIII, s. 116), except in rare circumstances. Instead, employers were required to rely on the adjudication provisions of the former ESA before seeking judicial review. In Susan Shoe Industries Ltd. v. Ricchiardi, 1994 CanLII 1313 (ON CA) the employer took the employment standards officer's order directly to the Divisional Court on judicial review, and the order was quashed. The officer appealed to the Court of Appeal, which restored the order and said that given the existence of specialized referees appointed under the former Employment Standards Act, "Except in exceptional circumstances . . . the courts ought not to interfere before the procedures under the Act have been exhausted." The court found that in this case there was no compelling reason to go outside of the normal processes provided for by the former Employment Standards Act and therefore the employer should have gone before a referee under the Act prior to seeking judicial review.
This issue was also considered in Stelco Inc. v. Nelson (October 21, 1994) (ON SC). The Divisional Court in Stelco followed the rule in Susan Shoe Industries Ltd. v. Ricchiardi and said that the administrative processes under the former Employment Standards Act were not to be circumvented; that is, matters were not to be brought to judicial review prematurely. In 949198 Ontario Inc. v. Koskie (March 4, 1993) (ON SC) the courts considered the issue of what would constitute exceptional circumstances such that parties could seek judicial review without first following the course contemplated by the former Employment Standards Act. Such exceptional circumstances included the applicant's being unable because of financial hardship to put money into trust in application for a s. 68 (now ESA Part XXIII, s. 116) appeal; personal liability at issue for an individual employer; or a case where there was a severe breach of the principles of natural justice.
None of these exceptional circumstances was present in either the Stelco case or Susan Shoe case.
In the 550551 Ontario Ltd. v. Framingham, 1991 CanLII 7388 (ON SC) case, however, one of these exceptional circumstances existed: that is, personal liability of an individual with regard to an order to pay of several million dollars. In that case, the court allowed judicial review of the employment standards officer's order, even without a referee's decision.
Subsection 120(1) provides that the Ontario Labour Relations Board may authorize a labour relations officer to try to settle any cases that are before the Board under ESA Part XXIII, s. 116.
Subsection 120(2) confirms that a settlement of an application for review proceeding at the Ontario Labour Relations Board is valid and binding even in the two circumstances that are set out:
This provision precludes the settlement by a labour relations officer of a compliance order issued by an employment standards officer under ESA Part XXII, s. 108 in the absence of the approval of the Director of Employment Standards.
Note that where a settlement is effected under ESA Part XXII, s. 112, that settlement will not void a compliance order. This is because such settlements are made without the approval of the officer — the parties are only required to inform the officer of the settlement.
This subsection sets out the effect of settling a matter raised in an application for review under ESA Part XXIII, s. 116. Any settlement entered into by the parties to the proceeding is binding, if the parties to the settlement do what they have agreed to do under the settlement. Such a settlement is binding despite the prohibition against contracting out of the ESA Part III, s. 5. Note that the persons that may enter into such a settlement include an agent acting on behalf of the employee. Subsection 120(4) also provides that where the settlement concerns the review of an order, that order is void and the review is terminated.
Subsection 120(4) must be read subject to s. 120(5), which allows a settlement to be voided if an employee can demonstrate to the Board that they entered into the settlement as a result of fraud or coercion.
Note that on November 6, 2009, ESA Part XXIII, s. 115.1 came into force. It provides that any reference to an employee in Part XXIII, including s. 116 and s. 120, includes a reference to an assignment employee or a prospective assignment employee.
Subsection 120(5) sets out the situation in which a settlement of an application for review under ESA Part XXIII, s. 116 proceeding at the Ontario Labour Relations Board can be set aside. It provides that if upon an application to the Board, the employee can demonstrate that he or she entered into the settlement as a result of fraud or coercion, the settlement will be voided, the employment standards officer's order (if any) is restored, and the proceeding that was terminated shall be resumed.
Note that on November 6, 2009, ESA Part XXIII, s. 115.1 came into force. It provides that any reference to an employee in Part XXIII, including ss. 116 and 120, includes a reference to an assignment employee or a prospective assignment employee.
In George v. 1008810 Ontario Ltd., 2004 CanLII 33763 (ON LRB), an employee sought to have a settlement agreement made pursuant to s. 120 regarding her claim for termination and vacation pay treated as null and void on the basis that the employer refused to pay the agreed-to amount. The Board concluded that as there had been no fraud or coercion, but rather non-compliance by one party, the settlement could not be voided under s. 120(5). Instead, the Board reasoned that the appropriate remedy was to require the employer to pay the claimant the money she was owed pursuant to the settlement and held that if the employer did not comply, the Board could issue an order to pay under ESA Part XXIII, s. 119(6) together with an administrative fee. Failure to pay that order would result in collection proceedings. The Board also noted that the employee was free to pursue any other claims against the employer including the human rights complaint she had discontinued in accordance with the settlement. (Note: the Program does not agree with the OLRB’s view that the remedy for non-compliance with a settlement term is to enforce the settlement. It is the Program’s position that the wording of s. 120(4) clearly provides that where a party does not do what they agreed to do under the terms of the settlement, the settlement fails and the review application picks up where it left off.)
In Dufresne v. InnVest Hotels GP Ltd. operating as Comfort Inn — Innvest Hotels Group, 2017 CanLII 4460 (ON LRB), the claimant sought to void a settlement agreement on the basis of coercion by the labour relations officer. The Board noted that coercion is the use of force to persuade an unwilling person to do something. The Board set out a number of principles, including: advising a party about the risks and likelihoods of a case does not amount to coercion; the fact that an offer is time-limited does not make it coercive; and where a party understands that they have a choice of accepting a settlement or proceeding to a hearing, the Board is not likely to find that the party was coerced into settling. The Board found that the Labour Relations Officer’s explanation of the potential risks of not signing a settlement did not constitute coercion, and that the claimant had already agreed to the settlement in principle before even speaking to the Labour Relations Officer. Therefore, the Board upheld the settlement agreement.
Subsection 120(6) was amended by the Employment Standards Amendment Act (Temporary Help Agencies), 2009, S.O. 2009, c. 9, effective November 6, 2009 to include a reference to orders to recover fees issued under ESA Part XVIII.1, s. 74.14. The Fair Workplaces, Better Jobs Act, 2017, S.O. 2017 c. 22 further amended this provision to provide for the recovery of a proportion of a collector’s fees and disbursements based on the amount an employee is entitled to receive under a settlement made under s. 116.
Clause 120(6)(b)(i) allows the Director of Employment Standards to distribute, in accordance with the terms of a settlement of an application for review proceeding at the Ontario Labour Relations Board pursuant to ESA Part XXIII, s. 116, any money respecting wages, fees or compensation that is held in trust and all or part of the administrative costs that were paid. Out of the money held in trust that is attributable to administration costs, the Director is entitled to be paid an amount that is proportionate to the amount of wages, fees or compensation ordered to be paid and the amount the employee is entitled to receive under the settlement, despite the fact that the order is voided by the settlement under s. 120(4)(b).
Clause 120 (6)(b)(ii) establishes the director’s entitlement to be paid a proportionate amount of the collectors’ fees and disbursements when a settlement is reached under an application for review proceeding under ESA Part XXIII, s. 116 between an employer and an employee if the order has been assigned to a collector. Out of the money that is attributable to the collection fees, the Director is entitled to be paid an amount that is proportionate to the amount of wages, fees, or compensation ordered to be paid to the employee and the amount the employee is entitled to receive under the settlement.
While this provision states that it is the Director who is entitled to the collector’s fees and disbursements, the Director may authorize the collector to exercise the powers specified in an authorization and collect the fees and disbursements under ESA Part XXIV, s. 127.
For example, consider an order issued for $1,000 in wages plus a $100 administrative fee. Assuming the director has authorized the collector to collect 20% of the order to pay in respect of the collector’s fees, in accordance with ESA Part XXIV, s. 127(3), a collection fee of $220 (($1,000 + $100) × 20%) would be added to the order. If the employer and the employee enter into a settlement under s. 120 of $800 (80% of the amount owing to the employee), the collector would be entitled to a proportional amount of the fee in the amount of $176 ($220 × 80% = $176), based on the settlement reached.
Note that on November 6, 2009, ESA Part XXIII, s. 115.1 came into force. It provides that any reference to an employee in ESA Part XXIII, including ss. 116 and 120, includes a reference to an assignment employee or a prospective assignment employee.
See also the discussion of ESA Part XXII, s. 112(6) regarding the payment of administrative costs and recovery of collector’s fees and disbursements, where a settlement is reached between the parties.
Subsection 120(6) should be read in conjunction with ESA Part XXIII, s. 117(3), which requires the Director to pay interest on any money, which will include any administrative costs, they are required to hold in trust and that is subsequently paid out under a settlement, at the rate and calculated in the manner determined by the Director under ESA Part XXI, s. 88(5).
This provision is similar to the corresponding section (s. 33(4) and s. 69) of the former Employment Standards Act, although the authority for the Director of Employment Standards to refer matters to the Ontario Labour Relations Board extended to potential contraventions of any provision of the Employment Standards Act, 2000, not just those involving Part XIII (Benefit Plans) provisions.
Section 121(1) gives the Director discretionary power to refer an issue to the Ontario Labour Relations Board where the Director believes that an employer, an organization of employers or employees, or a person acting directly on their behalf, may have contravened Part XIII. Part XIII prohibits discrimination in the provision of employment related benefit plans (pension, life insurance, disability insurance, health insurance or a health benefit plan) on the basis of age, sex, marital status or same-sex partnership status of an employee.
The section allows a referral to the Board whether the Director's belief arose as the result of a complaint or not. For example, the referral could be made on the basis of information discovered in the course of an inspection. Since this is not an application for review, but rather a reference by the Director, the power to set it into motion has not been delegated to the Board. The Director retains that power.
This section is similar to the general reference provisions in s. 69 of the former Employment Standards Act, that it makes it mandatory for the Board to hold a hearing if a matter regarding a contravention of Part XIII (Benefit Plans) has been referred (under s. 121(1)) to it by the Director.
Under the former Employment Standards Act, the s. 69 hearing was compared to a "reference" by at least one referee, Ritchie and Associates v. Flemming et al. (January 2, 1980), ESC 676 (Franks): that is, to a procedural hearing at common law, where a judge decides, at the request of one of the parties involved, a point of law or issue of fact that has been the subject of dispute. One case said that a hearing under s. 69 was more a fact-finding exercise than an adversarial proceeding: John Patrick Sheridan et al. v. United Steelworkers of America, Local 4440 (May 6, 1994), ESC 94-97 (Novick).
Generally, the employer in a s. 69 hearing did not bear the same degree of onus as it did in a s. 68 employer review hearing under the former Employment Standards Act.
This provision is similar to the corresponding sections (s. 69(5) and (6)) of the general reference provisions in the former Employment Standards Act.
Under this section, the Board may determine that there has been a contravention of Part XIII (Benefit Plans) of the Act and may direct that person to cease contravening Part XIII and take whatever action is necessary to do so. For example, the Board's order making power could extend to a corporate director acting on behalf of the employer. However, the order compensating the employee(s) for any loss or disadvantage in that case would be subject to the provisions regarding director's liability in Part XX of the Act.
The Board may also order the person to compensate any person or persons who may have suffered a loss or been disadvantaged because of the contravention.
This section provides that certain sections of s. 116 (applications for review), s. 118 (the Board's rules of practice), s. 119 (the powers of the Board) and s. 120 (settlements through labour relations officers) apply, with necessary modifications, with respect to the s. 121 reference. Those sections are:
This provision was introduced in the Employment Standards Act, 2000. It establishes a right of review of a notice of contravention issued under ESA Part XXII, s. 113. It limits the right of review to a person against whom the notice was issued. As a result, an employee has no right to apply for a review of a notice of contravention issued against their employer or a client of a temporary help agency.
ESA Part XXIII, s. 121(1) requires that the application be made within 30 days after the date the notice is served. See the discussions of the service requirements for a notice of contravention in ESA Part XXII, s. 113(3) and ESA Part XXI, s. 95.
In contrast to an employer's application for review of an order issued under ESA Part XXII, s. 103 or s.104, there is no requirement to pay the amount of the notice into trust.
The Ontario Labour Relations Board may extend the time for applying for a review, as it considers appropriate.
Note that ESA Part XXIII, s. 115.1 provides that any reference to an employee in Part XXIII includes a reference to an assignment employee or a prospective assignment employee.
This section imposes a mandatory obligation on the Board to hold a hearing for a review of a notice of contravention if the application has been made within 30 days of the date of the service of the notice or within the extended period allowed by the Board under s. 122(1).
Section 122(3) identifies the parties to a review of a notice of contravention as the person against whom the notice was issued, and the Director of Employment Standards.
Section 122(4) places the onus on the Director of Employment Standards to show, on a balance of probabilities, that the person against whom the notice of contravention was issued has contravened the provision of the Employment Standards Act, 2000 that was the subject of the notice.
The balance of probabilities standard of proof is consistent with the standard applied in proceedings before an administrative tribunal and in civil proceedings. It requires the Director to convince the Board that the evidence shows it is more likely than not that the person against whom the notice was issued committed the contravention. This standard is less onerous than that applied in criminal proceedings where it must be proved beyond a reasonable doubt that the crime was committed.
This section lists the findings that the Board may make on a review of a notice of contravention. The Board has three options:
The third option may apply, for example, where the officer has imposed a higher penalty for the contravention on the basis that it was the second time the employer had contravened the same provision of the Employment Standards Act, 2000 (for a contravention of ss. 2, 15 or 16) or has multiplied the penalty by the number of employees affected (for a contravention of a provision other than ss. 2, 15 or 16). See O. Reg. 289/01 for the schedule of penalties. In either case, the Board could reduce the penalty if, for example, it determined that this was only the first time the employer contravened ss. 2, 15 or 16 of the Employment Standards Act, 2000 or, in the case of a contravention of a provision other than ss. 2, 15 or 16, that the number of employees affected was less than the number found by the employment standards officer.
The Board's options do not extend to amending the notice by increasing the penalty. For example, where the employer standards officer had assessed the penalty based on a finding that an employer had contravened ESA Part XI, s. 33 with respect to five employees and on review, the Board determines that, in fact, 10 employees were affected by the contravention of s. 33, the Board could not increase the penalty.
This section provides that where the Board has extended the time for applying for a review and subsequently finds that the person applying for the review contravened the Employment Standards Act, 2000, it must enquire whether any collector's fees and disbursements were added to the notice under ESA Part XXIII, s. 128(2). If they were, the Board must advise the person to whom the notice was issued that such amounts are owing, when it issues its decision.
ESA Part XXIV, s. 128(2) provides that when a file is sent for collection, the collector's fees and disbursements are added to the amount of the order or notice of contravention.
This section provides that certain sections of ESA Part XXIII, s. 116 (applications for review), ESA Part XXIII, s. 118 (the Board's rules of practice) and ESA Part XXIII, s. 119 (the powers of the Board) apply, with necessary modifications, with respect to a review of a notice of contravention. Those sections are:
This provision is substantially the same as the corresponding section (s. 69.2(1)) of the former Employment Standards Act. Section 123(1) provides that the consent of the Board is required before an Ontario Labour Relations Board member, the Registrar, or any employee of the Board can be required to give testimony in any civil proceeding, Board proceeding, or proceeding before another tribunal respecting any information obtained in the exercise of his or her powers or the discharge of his or her duties under the Employment Standards Act, 2000.
Note that criminal proceedings are not covered by this provision.
This provision is substantially the same as the corresponding section (s. 69.2(2)) of the former Employment Standards Act. Section 123(2) ensures the confidentiality of settlement discussions with the Ontario Labour Relations Board's labour relations officers by providing that information or material revealed during the course of dealing with a labour relations officer is not to be disclosed unless authorized by the Board. See for example a decision under the former Employment Standards Act, Hammond v. 748403 Ontario Limited o/a Happy Landing Truck Stop (June 7, 1999), 3160-98-ES (ON LRB).
Section 124(1) provides that s. 124 applies if the Ontario Labour Relations Board has not made a decision six months after the last day of a hearing on a review of an order issued under any the following sections:
Section 124 also applies if the Board has not made a decision six months after the last day of a hearing on a review of a notice of contravention under s. 122 or on a review under s. 116 of a refusal to issue an order under the any of the following sections of the Employment Standards Act, 2000:
This section provides the parties and the Board with a mechanism to ensure a timely decision on a review.
Where the condition in s. 124(1) is present, s. 124(2) enables the chair to terminate the proceeding on the application of a party in the proceeding.
Section 124(3) allows the chair to re-institute proceedings it has terminated under s. 124(2), on terms and conditions it considers appropriate. The re-institution of proceedings under this section will enable the chair to direct, for example, that a decision be made within a specified period of time.
The intent of this Part is to facilitate the collection of money owed under the Employment Standards Act, 2000.
Subsection 125(1) was amended by the Strengthening and Improving Government Act, 2015 effective December 3, 2015.
Section 125 is the source of the authority to issue third party demands to persons the Director of Employment Standards believes or suspects owe money to, or are holding money, or will within 365 days owe or hold money for an employer, corporate director, or another person who is liable to make a payment under the Employment Standards Act, 2000. This includes the power to issue third party demands to persons owing money to or holding money for an employer, corporate director, or another person who owes money in respect of a notice of contravention under ESA Part XXII, s. 113.
Subsection 125(1) sets out the conditions that must be met before a third party demand may be issued. The conditions are as follows:
Therefore, the Director has the discretion to issue a third party demand on the basis of a reasonable belief that a person owes money to or is holding money or will, within the next 365 days, owe or hold money for another person who is liable to make a payment under the Employment Standards Act, 2000.
An employer, corporate director, or other person is liable to make a payment under the Employment Standards Act, 2000 where:
Generally, no third party demand would be issued unless the employer, corporate director, or other person does not comply with the order or notice and does not apply for a review of the order or notice within 30 days of service, and no settlement of the order has been effected under s. 112, s. 120 or s. 129. However, in extraordinary circumstances and with the manager’s approval a third party demand may also be issued after the order/notice has been issued but before the 30-day appeal period has expired. Because a review application may ultimately be filed in such cases, any money collected within 30 days after the order/notice is issued is held in trust for a reasonable period of time after the expiry of the appeal period.
If the above criteria are met and a third party demand is issued, the demand will indicate that the money the third party owes to the employer, corporate director or other person is, in whole or in part, to be paid to the Director of Employment Standards, in trust, for payment of monies owed under the Employment Standards Act, 2000. For example, a third party demand may be issued to a bank where money is held in an account of a person who owes money under the Employment Standards Act, 2000.
The power to issue third party demands for payment has been delegated under ESA Part XXI, s. 88. For further information see Delegation of Powers. In addition, under ESA Part XXIV, s. 127, the Director of Employment Standards has given to the Ministry of Finance, the Ministry’s authorized collector, authorization to exercise this power on the Director’s behalf for purposes of those orders and notices assigned to them.
This subsection provides that a demand issued under s. 125(1) remains in force for 365 days from the date the notice of the demand is served.
Subsection 125(2) indicates that s. 125(1) applies where a client of a temporary help agency owes money to, or is holding money for, a temporary help agency. For a discussion of the definition of the term “client" when used in relation to a temporary help agency, see ESA Part I, s. 1(1).
This provision states that the Director must serve the notice of the third party demand on the person to whom the demand is being made, in accordance with ESA Part XXI, s. 95.
The power with respect to service of a third party demand has been delegated under ESA Part XXI, s. 88. For further information see Delegation of Powers. In addition, under ESA Part XXIV, s. 127, the Director of Employment Standards has authorized collectors to exercise this power, for the purposes of recovering monies owing in respect of those files assigned to them for collection.
Subsection 125(4) was introduced by the Employment Standards Amendment Act (Temporary Help Agencies), 2009 effective November 6, 2009 to replace the former s. 125(3).
Subsection 125(4) provides that a third party is automatically relieved of liability, upon compliance with a demand under this provision, to the extent of the payment. (No receipt is required to discharge the liability.) The liability may relate to an amount owed to or held for an employer, director or other person who is liable to make a payment under the Employment Standards Act, 2000.
For example, if a bank owes $1,000 to an employer who is liable to pay the Ministry $700 on behalf of an employee entitled under the Act, the Ministry can serve a third party demand on the bank for the $700. Where the bank pays the Ministry the $700 pursuant to the demand, the bank is immediately relieved of its obligation to pay that amount to the employer. However, the bank would still be obliged to pay the employer the remaining $300.
This provision was introduced by the Employment Standards Amendment Act (Temporary Help Agencies), 2009 effective November 6, 2009 to replace the former s. 125(4).
Subsection 125(5) sets out the consequences of failure to comply with a third party demand. If a third party who has received a demand under s. 125 pays money to the employer, corporate director, or other person who is liable to make a payment under the Employment Standards Act, 2000 before complying with the demand, the third party will be required to pay to the Director the lesser of:
Section 125.1 is a new provision added by the s. 74.14. The Fair Workplaces, Better Jobs Act, 2017, S.O. 2017 c. 22, effective January 1, 2018.
This new provision is an additional tool to assist in the collection of outstanding orders and penalties under the Employment Standards Act, 2000. Section 125.1 allows the Director to accept security in any form satisfactory to the Director for the payment of amounts owing under the Employment Standards Act, 2000. The Director of Employment Standards, in accordance with ESA Part XXIV, s. 127, may authorize a collector to exercise this power.
Section 125.2 is a new provision added by the Fair Workplaces, Better Jobs Act, 2017, S.O. 2017 c. 22, effective January 1, 2018.
This new provision is an additional tool to assist in the collection of outstanding orders and penalties under the Employment Standards Act, 2000. It enables the Director to issue a warrant to a sheriff to enforce payment of an order to pay and the costs and expenses of the sheriff. A Director’s warrant has the same force and effect as a Writ of Seizure and Sale issued by a Superior Court of Justice Registrar under rule 60 of R.R.O. 1990, Regulation 194 Rules of Civil Procedure and is filed with the relevant sheriff (enforcement office). The Director of Employment Standards, in accordance with ESA Part XXIV, s. 127, may authorize a collector to exercise this power.
Section 125.3 is a new provision added by the Fair Workplaces, Better Jobs Act, 2017, S.O. 2017 c. XX, effective January 1, 2018.
This new provision is an additional tool to assist in the collection of outstanding orders and penalties under the Employment Standards Act, 2000.
It allows the Director to register a real property lien directly on title for identifiable real property. It also allows the Director to register a Personal Property Security Act, R.S.O. 1990, c. P.10 lien and charge on personal property for amounts owing on an order to pay and any applicable interest. The Director of Employment Standards, in accordance with ESA Part XXIV, s. 127, may authorize a collector to exercise these powers.
This provision permits the Director of Employment Standards to certify a copy of an order as a true copy and to file a certified true copy of an order to pay in court.
The effect of the section is to enable an order to pay money under the Employment Standards Act, 2000 to be enforced through the Ontario courts. The provision grants to the Director a status comparable to that of a judgment creditor, thereby making available such creditors' remedies as writs of seizure and sale, garnishments, and directions to enforce by sheriffs or bailiffs.
This section is the basis of a large part of the collection process under the Act. Once the certified copy of the order to pay is filed, it can be enforced like a judgment of the court, which means that the Rules of Civil Procedure respecting the enforcement of judgments apply.
Section 126(1) states that the order to pay may be filed in a "court of competent jurisdiction". There are two aspects to the concept of competent jurisdiction. Courts are subject to both monetary and geographical limits. If the order is for $25,000 or less, the order to pay money may be filed with the Small Claims Court located in the geographic area or areas where the employer resides or carries on business. If the amount exceeds the Small Claims Court threshold, then the Superior Court of Justice is the proper level of court in which to file the certified copy of the order; the certified copy may be filed with the Superior Court in any geographical area of the province. A writ of seizure and sale must be filed with the office of the Sheriff or Small Claims Court bailiff in the jurisdiction where the employer or director has assets, in order that enforcement may be carried out.
The Director’s power to certify a copy of an order as a true copy and to file a certified copy of an order to pay money has been delegated under s. 88 of the Act. See Delegation of Powers for further information. In addition, under s. 127, the Director of Employment Standards has authorized collectors to exercise this power, for the purposes of recovering monies owing in respect of those files assigned to them for collection.
Under s. 126(2), where a certified true copy of an order to pay is filed, the Director of Employment Standards is required to serve a copy of the order on the employer or corporate director, so that the affected parties are notified of the collection action against them.
This non-discretionary power has been delegated under s. 88 of the Act. See Delegation of Powers for further information. In addition, under s. 127, the Director of Employment Standards has authorized collectors to exercise this power for the purposes of recovering monies owing in respect of those files assigned to them for collection.
Section 126(3) states that once filed with a court of competent jurisdiction, a certified copy of an order to pay is enforceable in the same manner as a judgment or order of the court.
This authority has been delegated under s. 88 of the Act. See Delegation of Powers for further information. In addition, under s. 127, the Director of Employment Standards has authorized collectors to exercise this power for the purposes of recovering monies.
Section 126(4) establishes that, as with orders to pay, the Director, or his or her delegate, may certify a copy of a notice of contravention as a true copy and file a certified true copy of a notice of contravention with a court of competent jurisdiction, in accordance with s. 126(1). Where this is done, an advisory letter must be served in accordance with s. 126(2). The notice of contravention, once filed, may be enforced as an order of the court in accordance with s. 126(3).
The Director’s power to certify a copy of a notice of contravention as a true copy and to file a certified copy of the notice has been delegated under s. 88 of the Act. See Delegation of Powers for further information. In addition, under s. 127, the Director of Employment Standards has authorized collectors to exercise this power, for the purposes of recovering monies owing in respect of those files assigned to them for collection.
Subsection 127(1) permits the Director to authorize collectors to collect amounts owing under the Employment Standards Act, 2000, whether for employees or for the Minister of Finance for amounts owed to the former Employee Wage Protection Program or with respect to a notice of contravention, or to the Director for administrative costs. The Director’s authorization also extends to the collection, in Ontario, of amounts owed under legislation of reciprocating states to which ESA Part XXIV, s. 130 applies.
Subsection 127(1) must be read in conjunction with the definition of "collector" in ESA Part I, s. 1(1). Collector means a person (other than an employment standards officer) who is authorized by the Director of Employment Standards to collect amounts owing under the Employment Standards Act, 2000.
Subsection 127(2) identifies the powers that the Director of Employment Standards may authorize a collector to exercise. Any of the following powers, as the Director specifies in an authorization under s. 127(1), may be exercised in collecting amounts owing under the Employment Standards Act, 2000:
For reference, s. 19 of the SPPA states:
Therefore, if given this power by the Director of Employment Standards, the collector may file a certified copy of an order, notice of contravention or a decision of the Board in court and direct the sheriff or bailiff to take enforcement measures, such as seizure and sale of assets.
Subsection 127(3) states that the Director of Employment Standards may authorize the collector to collect a reasonable fee or reasonable disbursements, or both, from the persons from whom the collector is seeking to collect amounts owing under the Employment Standards Act, 2000, despite clause 22(a) of the Collection and Debt Settlement Services Act, R.S.O. 1990, c. C.14.
Clause 22(a) of the Collection and Debt Settlement Services Act states that no collection agency or collector shall "collect or attempt to collect, on its own behalf or for a person for whom it acts, any money in addition to the amount owing by the debtor.”
It is necessary for s. 127(3) to create an exception to the prohibition in s. 22(a) of the Collection and Debt Settlement Services Act for fees authorized under s. 127(3), since those fees are deemed, under s. 128 (2), to be added to the amount of the order, and must be collected from the person owing the money under the Employment Standards Act, 2000.
This provision must be read in conjunction with ESA Part XXII, s. 112(6)(b) and ESA Part XXIII, s. 120(6)(b)(ii) which limit the recovery of collector’s fees and disbursements to a proportion that is the same as the proportion of the amount of wages, fees or compensation ordered to be paid that the employee is entitled to receive as a result of a settlement under s. 112 or s. 120.
Subsection 127(4) provides that the Director may impose conditions on the authorization of a collector and may determine what constitutes a reasonable fee or disbursements in the circumstances.
This provision must be read in conjunction with ESA Part XXII, s. 112(6)(b) and ESA Part XXIII, s. 120(6)(b)(ii) which limit the recovery of collector’s fees and disbursements to a proportion that is the same as the proportion of the amount of wages, fees or compensation ordered to be paid that the employee is entitled to receive as a result of a settlement under s. 112 or s. 120.
Subsection 127(5) means that the Director of Employment Standards may not authorize a collector who is required to register under the Collection and Debt Settlement Services Act to collect disbursements, although the Director may authorize such a collector to collect fees. The difference between fees and disbursements is that the latter consist of expenses that the collector has incurred, (photocopying, gas, long distance charges), whereas the former represent the payment for the collector’s services, whether a flat fee, a commission or some other consideration.
Subsection 4(1) of the Collection and Debt Settlement Services Act states:
In s. 1(1) of the Collection and Debt Settlement Services Act, "collection agency" and "collector" are defined as follows:
Generally, a collector working for a collection agency must be registered under the Collection and Debt Settlement Services Act and therefore, the Director of Employment Standards may not authorize such a collector to collect disbursements.
Note that s. 2 of the Collection and Debt Settlement Services Act states that, subject to the regulations, the Act (and hence the requirement for registration) does not apply to certain persons who might be involved in collections work, such as, for example, lawyers and banks; thus, if the collector falls within s. 2, the Director could authorize that collector to collect both fees and disbursements.
Subsections 127(6) and (7) allow the Director to disclose information collected under the authority of the Act or the regulations to a collector for the purpose of collecting an amount payable under the Employment Standards Act, 2000.
Any disclosure of personal information made by the Director under s. 127(6) is deemed to be in compliance with clause 42(1)(d) of the Freedom of Information and Protection and Privacy Act, R.S.O. 1990, c. F.31 (“FIPPA”).
Clause 42(1)(d) of FIPPA states:
Subsection 128(1) permits the collector to exercise the powers specified by the Director of Employment Standards. It must be read in conjunction with ESA Part XXIV, s. 127(2), which enumerates the enforcement powers that the Director may delegate to a collector in an authorization provided under ESA Part XXIV, s. 127(1).
Subsection 128(2) provides that the authorized fees and disbursements of the collector will be deemed to be part an order or notice of contravention that has been assigned to a collector. This means that the employer, corporate director or person who owes the money under the Employment Standards Act, 2000 will be responsible for the costs of collection. It also means that the same mechanisms under the Employment Standards Act, 2000 used to enforce and collect an order for wages or compensation (including administrative costs) and penalties assessed under a notice of contravention, can also be used to enforce and collect the collector’s authorized fees and disbursements.
Subsection 128(3) sets out how the collector must disburse the money collected. It only applies where the collector has collected the full amount owing to all persons under the order or notice of contravention, including the person in favour of whom the order was written, the Director (in regard to administrative costs), the collector (in regards to fees and disbursements) and the Minister of Finance (in regard to a notice of contravention). Interest on money collected will be allocated according to the corresponding principal amount, except for interest on the collection fees and disbursements collected, which will be allocated according to the terms of the contract or other agreement between the Director and the collector. Where less than the full amount is collected, the provisions of s. 128(4) apply instead.
The Director’s power to provide a collector with written consent to pay directly to a person the wages or compensation they are entitled to has been delegated under ESA Part XXI, s. 88. See Delegation of Powers for further information.
Subsection 128(4) states what happens when the amount collected is less than the full amount of the order including administrative costs and the collector’s fee. In this situation, the money is to be distributed to each person including the Director of Employment Standards and the collector in proportion to the amount they are owed.
Subsections 128(5) and (6) allow the collector to disclose information collected under the authority of the Employment Standards Act, 2000 or the regulations to the Director if the information was collected for the purposes of collecting an amount payable under the Employment Standards Act, 2000.
Any disclosure of personal information made by the Director under s. 128(6) is deemed to be in compliance with clause 42(1)(d) of the Freedom of Information and Protection and Privacy Act, R.S.O. 1990, c. F.31 (“FIPPA”).
Clause 42(1)(d) of FIPPA states:
Section 129(1) states that a collector appointed by the Director may effect a settlement of the amount owing under the Employment Standards Act, 2000 if the creditor (generally the employee) agrees in writing to the settlement. The provision also states that in the case of a notice of contravention, the collector may effect a settlement of the amount owing under the Act if the Director agrees in writing to the settlement.
This provision should be read together with subsection 129(2), which restricts the authority of the collector to effect a settlement where the person to whom the money is owed would receive less than 75 per cent of the money to which he or she is entitled.
The Director’s power to agree in writing to a settlement in the case of a notice of contravention has been delegated under s. 88 of the Act. See Delegation of Powers for further information.
This provision is substantially the same as s. 73.0.3(2) of the former Employment Standards Act.
Section 129(2) states that the written approval of the Director is required if the collector is to effect a settlement under which the person to whom the money is owed would receive less than 75 per cent (or such other percentage as may be prescribed by regulation) of the money to which he or she is entitled. At the time of writing, no other percentage had been prescribed.
The Director’s power under this provision has been delegated under s. 88 of the Act. See Delegation of Powers for further information.
Section 129(3) was amended by the Employment Standards Amendment Act (Temporary Help Agencies), 2009, S.O. 2009, c. 9, effective November 6, 2009 to include a reference to orders issued under Part XVIII.1.
This provision was introduced by the Employment Standards Act, 2000. It is similar in part to s. 73.0.3(3) and s. 73.0.3(5) of the former Employment Standards Act and codifies the common law as well as Program policy under the former Act.
Section 129(3) states that the order, upon which the settlement is based, becomes void when the person against owing under the settlement must be paid to the collector and the collector must then pay the money out in accordance with s. 128(3) andwhom the order was made does what they have agreed to do in the settlement. Section 129(3) also incorporates the common law and Program policy by stating that a settlement that is entered into as a result of fraud or coercion will not be binding.
A question concerning the voiding of an order under this section may arise where the order pertains to the entitlements of several individuals, and a settlement is achieved respecting one or more but not all of the individuals. Program policy is that in these circumstances, only the portion of the order that relates to the individual covered by the settlement would be void.
This provision was introduced by the Employment Standards Act, 2000.
Section 129(4) states that a notice of contravention, upon which a settlement (made with the agreement of the Director, s. 129(1)(b)) is based, becomes void when the person against whom the notice was made does what they have agreed to do in the settlement.
This provision is similar to ss. 73.03(3) and (4) of the former Employment Standards Act.
Section 129(5) states that when a settlement is made, any money s. 128(4).
Section 130(1) defines the two key terms used in the reciprocal enforcement provisions. Both definitions are "inclusive". This means that they are not exhaustive, and other terms similar to those listed will also fit the definitions.
In this instance, the word "order" will include any order to pay money issued under employment standards legislation in another state. It may also include a judgment or certificate.
The term "state" is also given a broad meaning: it may be taken to include any jurisdiction outside of Ontario, since another province or territory of Canada or any foreign state or part of a foreign state would be included in the definition. The definition of "state" must be read in conjunction with s. 130(2) and s. 2 of O. Reg. 289/01, which lists those states that are reciprocating states for the purposes of reciprocal enforcement under the Act. This list in s. 2 of O. Reg. 289/01 was amended by O. Reg. 475/06 filed on October 6, 2006 to include Newfoundland and Labrador, and by O. Reg. 295/11, effective July 1, 2011, to include Quebec. All Canadian provinces and territories are now reciprocating states.
Section 130(2) provides that those states prescribed by regulation may make use of the reciprocal enforcement of orders provisions in the Act.
Section 2 of O. Reg. 289/01 prescribes the reciprocating states as follows:
| Column 1 | Column 2 |
|---|---|
| Alberta | Director of Employment Standards for Alberta |
| British Columbia | Director of Employment Standards for British Columbia |
| Manitoba | Director of Employment Standards for Manitoba |
| New Brunswick | Director of Employment Standards for New Brunswick |
| Newfoundland and Labrador | Director of Labour Standards for Newfoundland and Labrador |
| Northwest Territories | Labour Standards Board of the Northwest Territories |
| Nova Scotia | Director of Employment Standards for Nova Scotia |
| Nunavut | Nunavut Labour Standards Board |
| Prince Edward Island | Inspector of Labour Standards for Prince Edward Island |
| Quebec | Commission des normes du travail |
| Saskatchewan | Director of Labour Standards for Saskatchewan |
| Yukon | Director of Employment Standards for the Yukon |
With the addition of Quebec, added to O. Reg. 289/01 by O. Reg. 295/11, all Canadian provinces and territories are now reciprocating states.
Section 130(3) permits a reciprocating state to apply to the Director for enforcement in Ontario of an order issued by the reciprocating state.
This provision is virtually identical to s. 73.1(4) the former Employment Standards Act.
Section 130(4) states that an application for reciprocal enforcement must be accompanied by a certified true copy of the order. Clauses 130(4)(a) and (b) designate who may certify the copy of the order: either the court where the original was filed or the responsible authority (if the employment standards legislation of the other state does not have provision for filing an order with a court).
This provision is virtually identical to subsection 73.1(5) of the former Employment Standards Act.
Section 130(5) is a parallel provision to ss. 126, which allows for the filing of an order with a court of competent jurisdiction for enforcement purposes.
Section 130(5) provides the power to enforce an order of a reciprocating state through the Ontario courts. Pursuant to s. 130(1), an "order" may include a judgement as well as an order issued under a provision similar to s. 126(1) of the Employment Standards Act, 2000. It permits the Director to file a certified copy of the order in a court of "competent jurisdiction". Once filed, the order is enforceable as a judgment or order of the court. The effect of this section is that an order of a reciprocating state will be enforceable in the same manner as an order issued under the Employment Standards Act, 2000.
The Director’s power under this section has been delegated under s. 88 of the Act. See Delegation of Powers for further information.
This provision is substantially the same as s. 73.1(6) of the former Employment Standards Act.
Section 130(6) permits the recovery of the costs of enforcing the order as if it were an order of the court in which it is filed.
The Director’s power under this provision has been delegated under s. 88 of the Act. See Delegation of Powers for further information.
The purpose of the Offences and Prosecutions part of the Employment Standards Act, 2000 is to set out the offences for which employers, including officers and directors of employers, and other individuals, such as claimants providing false information, can be prosecuted under the Provincial Offences Act, R.S.O. 1990, c. P.33.
This provision is substantially the same as the corresponding section (s. 77(1)) of the former Employment Standards Act. Section 131(1) prohibits any person from making, keeping or producing false or deceptive records, or other documents required to be kept under the Employment Standards Act, 2000 and regulations. It also prohibits any person from having a hand in the making, keeping or production of such records, whether such participation is active (e.g., actually making the records) or passive (e.g., agreeing to such records or having knowledge of them but not doing anything to stop the practice).
This prohibition applies to all records or other documents required to be kept by the employer as set out in ss. 15 and 16 of the Act. These sections require specified information to be kept (including a register for homeworkers) and retained for specified periods of time and made available for inspection by an employment standards officer.
In the context of s. 131(1), "produced" does not mean "made", but rather "produced for inspection, audit or examination", i.e., given over to the employment standards officer, pursuant to a demand for records. Thus, if the employer gives the officer false or deceptive records (records that are required to be kept under the Act), pursuant to a demand under ss. 91 or 102, the employer would be guilty of an offence under s. 131(1).
What if the employer gives the information voluntarily, rather than pursuant to a demand? In that case, the employer would still be guilty of making or keeping the false records in the first place, which is also an offence under s. 131(1) if those are the types of records that the employer is required to make and keep under the Act. Also, the employer may be guilty of an offence under s. 131(2) for providing false or misleading information, regardless of whether the information was supplied voluntarily or not, and regardless of whether the employer is required to keep such information.
This provision is identical to the corresponding section (s. 77(2)) of the former Employment Standards Act. Section 131(2) prohibits any person from providing false or misleading information under the Act. It has a general application in prohibiting any person, whether it be an employer (including a corporate employer, since in law a corporation is considered a "person"), an employee, a director or officer or agent of an employer, or any other person, from providing false or misleading information under the Employment Standards Act, 2000. It covers situations where the information is provided voluntarily, as well as pursuant to a demand or a subpoena, and situations where the information is required to be kept by the Act, as well as those in which the information is not required to be kept.
This provision is similar to s. 78(1) of the former Employment Standards Act. Section 132 applies to every person, which includes a corporation and trade union, who violates a provision of the Employment Standards Act, 2000 or regulations, or disobeys a decision, requirement or order made under the Act.
Section 132 makes it an offence to violate a provision of the Act: for example, a failure to pay overtime pay, or a failure to reinstate an employee after a pregnancy or parental leave. It also makes it an offence to disobey an order, direction or requirement under the Act: for example, a failure to comply with an order to pay issued under s. 103(1)(b), a failure to comply with a compliance order under s. 108(1), or a failure to comply with a notice requiring attendance at a meeting with an officer under s. 102.
To obtain a conviction for an offence, the Crown has to prove its case beyond a reasonable doubt, which is the standard of proof in criminal and quasi-criminal cases.
Prosecutions for an offence under the Employment Standards Act, 2000 may be initiated under Part I or Part III of the Provincial Offences Act, R.S.O. 1990, c. P.33 ("POA"). A Part I prosecution can only be commenced by a person who has been appointed a provincial offences officer. Part I prosecutions are commenced by filing a certificate of offence with the Ontario Court of Justice and serving the accused with either an offence notice ("ticket") or summons. A ticket may only be used where a set fine for the offence in question has been established by the Chief Justice of the Ontario Court of Justice. Set fines have been established for many Employment Standards Act, 2000 offences. As well, abbreviated descriptions of those offences for use on the tickets have been authorized by regulation under the POA. See Schedules 4.2, 4.3 and 4.4 to R.R.O. 1990, Reg. 950.
A provincial offences officer may also use the Part I summons procedure for Employment Standards Act, 2000 offences. The POA provides that where the summons procedure is used in respect of an offence under an Act, the provisions in the Act respecting maximum fines and terms of imprisonment do not apply; instead the POA provides that the maximum fine that can be imposed on conviction is $1,000. A sentence of imprisonment cannot be imposed if the summons procedure is used.
If a prosecution is commenced under Part III of the POA, the section 132 provisions regarding maximum fines and (in the case of an individual) maximum terms of imprisonment would apply.
Under s. 132, an individual who is found guilty of an offence is liable to a fine of not more than $50,000 or 12 months in jail, or both. The maximum jail term is increased in the Employment Standards Act, 2000 from six months under the former Act to 12 months.
A corporation that is found guilty of an offence is liable to a fine of not more than $100,000 for a first conviction, $250,000 for a second conviction, and $500,000 for a third or subsequent conviction. These escalating monetary penalties for corporations are a new deterrence provision in the Employment Standards Act, 2000.
Appeals from decisions of a justice of the peace are to a judge of the Ontario Court of Justice, from which a further appeal to the Court of Appeal may be made with the leave of that Court. Appeals from the decision of a provincial judge are to the Superior Court of Justice, from which a further appeal to the Court of Appeal may be made with the leave of that Court.
This provision was amended by the Employment Standards Amendment Act (Temporary Help Agencies), 2009, S.O. 2009, c. 9, effective November 6, 2009 to include references to contraventions under Part XVIII.1.
Section 133(1) applies if:
If either of the conditions above is met, the justice of the peace or the provincial judge making the conviction shall, in addition to the fine or term of imprisonment, order specific action that the convicted person must take or refrain from taking in order to remedy the contravention. This provision should be read in conjunction with s. 133(2) which discusses the types of orders that may be made by the court.
In R v. Hartro Office Systems the employer was convicted under the predecessor to s. 132, since the only logical explanation of the reason for the employee's dismissal was that he filed a complaint under the Employment Standards Act, 2000. The employer was fined $8,000. However, in R v. Marconi, the defendant was acquitted on the grounds that the evidence showed the employee was dismissed prior to the defendant becoming aware that the employee had filed a complaint under the Act.
Section 133(2) was amended by the Employment Standards Amendment Act (Temporary Help Agencies), 2009 effective November 6, 2009 to include a reference to a contravention of ESA Part XVIII.1, s. 74.12.
In addition to the powers granted to the court under s. 133(1), if an employer is convicted of contravening ESA Part XVIII.1, s. 74 or paragraph 4, 6, 7 or 10 of ESA Part XVIII.1, s. 74.8(1), s. 133(2) authorizes, but does not require, the court to order that the employee be paid any wages that are owing to the employee and/or that the employee be compensated for any loss incurred as a result of the contravention. Where the employer has been convicted for violating s. 74, the court may also order that the person be reinstated.
Note that for convictions relating to contraventions of sections other than s. 74 or paragraphs 4, 6, 7, or 10 of s. 74.8(1), the court is required to order the employer to pay any amount owing to the employee with respect to the contravention pursuant to ESA Part XXV, s. 135(1).
In addition to the powers granted to the court under s. 133(1), if a client is convicted of contravening s. 74.12, s. 133(2) authorizes, but does not require, the court to order that the assignment employee be paid any wages that are owing, be compensated for any loss incurred by them, and/or be reinstated.
For a discussion of the meaning of the term "client" when used in relation to a temporary help agency, see ESA Part I, s. 1(1).
Section 133(3) provides that if a conviction is obtained under ESA Part XXV, s. 132 in relation to a contravention of the lie detector provisions of the Employment Standards Act, 2000 and the contravention concerned an applicant for employment or an applicant to be a police officer, the court could order the employer to hire the applicant and or/compensate them for the violation.
Section 134 was amended by the Employment Standards Amendment Act (Temporary Help Agencies), 2009, S.O. 2009, c. 9, effective November 6, 2009.
Section 134 sets out the fine for a failure to comply with an order of a court made under ESA Part XXV, s. 133. For example, if the court, on conviction, orders an employer to reinstate an employee, with compensation for lost wages and benefits, and the employer fails to comply, the court may further order the employer, if an individual, to pay a fine of up to $2,000 for each day that the employer failed to comply with the order of the court. If the employer is a corporation, the court could order that the employer pay a fine of up to $4,000 for each day the employer failed to comply with the court's order.
For example, if the employer was ordered to reinstate the employee by March 1, 2002, and the employee did not do so until April 1, 2002, the employer could be fined up to $124,000, if a corporation, or $62,000, if an individual, for the failure to comply in a timely manner with the order of the court. This fine would also apply where the employer had not complied in a timely manner with an order of the court to pay compensation to the employee. The fine under s. 134 would be in addition to any fine and/or imprisonment imposed pursuant to ESA Part XXV, s. 132 with respect to the prohibited reprisal. This provision also applies with respect to clients, as defined in ESA Part I, s. 1(1) who fail to comply with an order issued under ESA Part XXV, s. 133.
This provision was amended by the Employment Standards Amendment Act (Temporary Help Agencies), 2009, S.O. 2009, c. 9, effective November 6, 2009 to specifically exclude convictions for contraventions of paragraphs 4, 6, 7 or 10 of s. 74.8(1). References to paragraphs 4, 6, 7 and 10 of s. 74.8.1 were added to s. 133(1) of the Employment Standards Act, 2000. For a discussion of s. 133, see ESA Part XXV, s. 133.
Section 135(1) indicates that where an employer is convicted of an offence under s. 132, other than a conviction for a violation of s. 74 (reprisal) or paragraph 4, 6, 7, or 10 of s. 74.8(1) (temporary help agency prohibitions), the court is required to assess the amount owing to the employees by the employer as a result of the employer's contravention of the Act, and to order the employer to pay the amount involved, in addition to any other penalty (i.e., fine and/or term of imprisonment) ordered. For example, where the employer had not paid an order to pay and accordingly committed an offence that resulted in a conviction under s. 132, the court is required (in addition to any fine or jail sentence that may be ordered,) to assess the amount owing and to order the employer to pay the amount owing to the Director of Employment Standards in trust, who in turn then pays the amounts owing to the affected employee(s).
Under s. 135(1), the court could not order the employer to pay the 10 per cent administration costs portion of the order to pay, since the section refer specifically to an "amount owing to an employee". However, the court's assessment of the amount owed to the employee could include interest.
Section 135(2) provides that the Director of Employment Standards must attempt to collect any money that is ordered to be paid under s. 135(1) and pay it to the employee.
This provision is substantially the same as the corresponding section (s. 78(3)) of the former Employment Standards Act. Section 135(3) provides that the Director, for enforcement purposes, may file an order issued by the court under s. 135(1) in a court of competent jurisdiction. The order then becomes enforceable as an order of the court for purposes of enforcement. This means, for example, that a writ of seizure and sale could be obtained so that the Director could seize the defaulting employer's assets and property and sell them in order to satisfy the amounts owing.
This provision was first introduced by the Employment Standards Act, 2000. It provides that a director of a corporation is guilty of an offence where he or she fails to comply with an order of an employment standards officer made under ss. 106 or 107, and has not applied for a review of the order, or fails to comply with such an order that has been affirmed by the Ontario Labour Relations Board or with a new order issued by the Board.
This provision was first introduced by the Employment Standards Act, 2000. It provides that a director convicted under s. 136(1) is liable to a fine of not more than $50,000. Note that directors convicted under s. 136(1) are not liable to imprisonment.
These provisions are substantially the same as the corresponding section (s. 79(1)) of the former Employment Standards Act. Section 137(1) provides that where a corporation contravenes any provision of the Act or the regulations, an officer, director or agent of the corporation, (or a person acting or claiming to act in such a role), who participates in such a contravention, is a party to, and guilty of, the offence, and is liable on conviction to the penalty provided for the offence, i.e., a maximum of $50,000 fine and/or 12 months' imprisonment. This applies whether such a person participates actively, e.g., by authorizing it, or passively by knowing of it, but failing to take steps to prevent it.
Section 137(2) indicates that the individual officer, director or agent may be convicted under this subsection, even though the corporate employer has not been prosecuted or convicted. Thus, a corporate director could be prosecuted under s. 137, even though a prosecution had not been commenced against the corporate employer under s. 132, or if it was, even though it did not result in a conviction.
The key to s. 137 is that the officer, director or agent of the corporation must be a person who "authorizes or permits. . . or acquiesces" in a contravention of the Employment Standards Act, 2000 or regulations by the corporate employer.
The predecessor section to s. 137 was considered by the trial court in R v. Lark Manufacturing Inc. and court's decision was upheld by the Ontario Court of Appeal. In that case, the trial court stated that the directors would not be liable under s. 79 of the former Employment Standards Act (now s. 137) if they proved, on a balance of probabilities, that they were duly diligent. In this regard, the trial court noted several points. Section 137 is a strict liability and not a full mens rea offence. The latter type of offence is one in which the accused must have had the intention to commit the act or omission that constitutes the offence or crime in question.
A strict liability offence, on the other hand, is one in which it is not necessary to show intent, but merely that the act or omission occurred, except that the accused can usually be acquitted by showing that he or she was duly diligent (i.e., took all reasonable precautions in the circumstances to prevent the violation from taking place). An absolute liability offence is one in which it is not necessary to show intent, and the accused cannot be acquitted, even if he or she demonstrates due diligence. Therefore, a strict liability offence lies somewhere between a full mens rea offence and an absolute liability offence as far as the issue of due diligence is concerned.
The court in R v. Lark also noted that corporate directors have the authority to run the company and the ultimate responsibilities for the actions of its employees unless the directors can show that in spite of all reasonable precautions being taken, the employees acted outside their instructions.
The court further noted that Supreme Court of Canada authority indicates that the reverse onus clause in the predecessor clause to s. 137(3) is not contrary to the Canadian Charter of Rights and Freedoms.
The trial judge in R v. Lark Manufacturing Inc. found the directors guilty of an offence pursuant to s. 79 of the former Employment Standards Act (now s. 137) in that they did not prove, on a balance of probabilities, that they did not participate (actively or passively) in the corporation's failure to pay wages, vacation pay and termination pay to the employees. The court found that the directors foresaw or ought to have foreseen the closing of the business by the bank, and were aware of and contributed to the decision that was made to terminate the employees without proper notice as the business situation deteriorated. The trial court pointed to a number of pieces of evidence in this regard, including the fact that the defendants, in advance of the closure of Lark, were engaged in setting up a new business to perform the same work as Lark did.
On appeal, the Ontario Court (General Division) (now the Superior Court of Justice) reversed the conviction of the directors by the trial judge, finding that there was no evidence that the defendant directors knew in advance of the bank's intention to close the business, and no evidence that they knew in advance or concurrently that the bank would withhold the last payroll cheques. The Crown then appealed to the Ontario Court of Appeal, which restored the convictions imposed by the trial judge on the basis that the findings made by the trial judge were supported by evidence and should have been accepted by the judge on appeal, especially given the onus placed on the respondent directors by s. 137(3).
One of the issues that arose in the Lark case was whether or not the defendants were directors at the relevant times. The directors claimed to have resigned one week before the business closed and were therefore arguing that they were not responsible for the resulting failure of the employer to pay the employees. The trial court noted that s. 121(2) of the Business Corporations Act, R.S.O. 1990, c. B.16 requires that a notice of resignation by a director is not effective until such time as it is received by the corporation, and there was no evidence that the alleged notice of resignation was received by the corporation.
It is interesting to note that s. 137(2) states that an individual liable under the section may be an officer, director or agent of the corporation, or a person acting or claiming to act in such a capacity. This would cover individuals, for example, who were acting in the capacity of directors, and were holding themselves out as such, but who were technically, due to some defect in their appointment, not directors of the company. It would also cover situations such as where persons were not authorized to be agents of a company with regards to certain matters, but took it upon themselves to do so anyway, and in that unauthorized capacity participated in the contravention of the Act by the company.
This provision is similar to s. 79(2) of the former Employment Standards Act. Section 137(3) is a reverse onus provision. It states that in a prosecution under s. 137, the onus is on the director, officer or agent to prove that he or she did not participate, actively or passively, in the corporation's contravention of the Act and regulations. The individual does not have to prove this beyond a reasonable doubt. He or she need only prove it on a balance of probabilities. If he or she fails to prove this on a balance of probabilities, then a conviction would be entered by the Court provided that the Crown had proved beyond a reasonable doubt the other elements of the case, e.g., that the corporation violated the Act or regulations.
There is authority from the Supreme Court of Canada that such reverse onus clauses do not violate the Charter of Rights and Freedoms. See, for example, R v. Wholesale Travel Group Inc., [1991] 3 SCR 154, 1991 CanLII 39 (SCC).
These provisions are similar in effect to the corresponding section (s. 79(3)) of the former Employment Standards Act. Sections 137(4) and (5) indicate that where an individual is convicted of an offence under s. 137, the court may, in addition to any other penalty, assess the amount owed by the corporation in regards to the employee(s), and may order the individual to pay the amount assessed to the Director of Employment Standards in trust, who would distribute to the employee(s) the amounts owed. Please note that unlike section 135(1) this section does not require the court to make an assessment and order the payment of wages to the Director upon the conviction of an individual.
Section 79(3) of the former Employment Standards Act was used by the Crown in the R v. Lark Manufacturing Inc. case to obtain a court order for three directors of the company to pay approximately $500,000 in unpaid wages, vacation pay and termination pay to the Director of Employment Standards in trust for distribution to the employees. Note that the court's order against a director may exceed the maximum liability for wages and vacation pay in Part XX (Liability of Director) and may also include termination and severance pay. The limitations on directors' liabilities set out in Part XX do not apply where the director has been prosecuted and convicted of an office under s. 137.
It should be noted that under s. 79(3) of the former Employment Standards Act it was possible for the court to include in the order against the directors amounts for interest as well as the 10 per cent administration costs portion of the order to pay against the employer (although that was not done in R v. Lark Manufacturing Inc). Under s. 137 of the Employment Standards Act, 2000, the court could not order the employer to pay the 10 per cent administration costs portion of the order to pay, since s. 137(4) refers specifically to an "amount owing to an employee". However, the court's assessment of the amount owed to the employee could include interest.
Furthermore, no fine or imprisonment was ordered by the Court in R v. Lark Manufacturing Inc., presumably because the Court was of the view that the requirement for the directors personally to pay about $500,000 in employee entitlements was a sufficient deterrent on its own.
Finally, it should be noted that in s. 137 prosecutions (as in s. 79 prosecutions under the former Employment Standards Act) the court could put the convicted director on probation and make such probation conditional on payment of the monies ordered to be paid to the Director of Employment Standards in trust. In other words, if the convicted director does not pay as ordered by the court, that individual would have his or her probation revoked and would be liable to a jail sentence. However, such a conditional probation order, although asked for by the Crown in the Lark case, was not given by the trial Court, although a simple probation order was given, requiring the convicted individuals "to keep the peace and to be of good behaviour", meaning that the probation could be revoked if further violations of the law occurred.
This provision read together with s. 137(7) is substantially the same as the corresponding section (s. 79(4)) of the former Employment Standards Act. Section 137(6) provides that a prosecution under s. 137 of an officer, director or agent (or person acting or claiming to act in such a capacity) of a corporation that has contravened the Act or regulations can only be commenced with the consent of the Director of Employment Standards. This power has been delegated under s. 88 of the Act. See Delegation of Powers for further information.
Section 137(7) provides that a document that appears to be the consent of the Director (or his delegate pursuant to s. 88 of the Act) to prosecute under s. 137 is admissible as evidence of the Director's consent.
Section 137.1(1) provides that a prosecution of an employment standards officer for a failure to follow policy as established by the Director, as required by s. 89(2), may only be commenced if consented to by the Deputy Attorney General. For further discussion of s. 89(2) of the Employment Standards Act, 2000, see ESA Part XXI, s. 89(2).
Section 137.1(2) provides that a document that appears to be the consent of the Deputy Attorney General to prosecute an employment standards officer is admissible as evidence of his or her consent. Prosecution of Employment Standards Officer, s. 137.1(1) Proof of Consent, s. 137.1(2)
These provisions are similar to the corresponding section (s. 81) of the former Employment Standards Act. Section 138 provides that the prosecutor can choose, by giving notice to the clerk of the court, to have the prosecution of an offence conducted in the area where the accused resides or carried on business, rather than where the offence occurred. In addition, the Attorney General or his or her agent may request the matter to be heard by a judge rather than a justice of the peace.
For example, if the accused is a director of a corporation and resides in Toronto, the Crown may have the case heard by the Ontario Court of Justice in Toronto, even though the company carried on business in Hamilton.
This provision was first introduced by the Employment Standards Amendment Act (Hours of Work and Other Matters), 2004, S.O 2004, c. 21, effective March 1, 2005.
Where a person has been convicted of an offence under the Employment Standards Act, 2000, this provision authorizes the Director to publish or otherwise make available to the public - including publication on the Internet - the name of the convicted person, a description of the offence, the date of the conviction, and the sentence received by the person.
Subsection (3) deems any disclosure made under subsection (1) to be in compliance with s. 42(e) of the Freedom of Information and Protection of Privacy Act, R.S.O. 1990, c. F.31. That section reads:
This provision is similar in effect to the corresponding section (s. 82) of the former Employment Standards Act, except that the two-year period in the former Employment Standards Act commenced with the date on which the facts upon which the prosecution was based first came to the knowledge of the Director. Section 139 provides that no prosecution can be commenced under the Act more than two years after the date on which the offence was committed or alleged to have been committed.
The date on which an offence has been committed or is alleged to have been committed is determined by the nature of the offence. For example, a contravention of the Employment Standards Act, 2000's requirements concerning the payment of wages (e.g., regular wages, overtime pay etc.) occurs on the date such wages were due under the Act. A contravention of s. 74 (Reprisal) may occur on the date the employer penalized the employee for exercising or attempting to exercise a right under the Act (e.g., the date the employee was suspended for having refused to agree to work excess hours). Finally, an offence may be committed when the employer (or other person) has failed to comply with an order, requirement or direction under this Act.
As an example, consider a case where an employer fails to pay overtime pay due on the employee's regular pay day on November 15, 2001 (for hours worked on November 1). The employee files a claim related to this contravention on February 1, 2002. An employment standards officer issues and serves an order to pay on May 1, 2002, and the employer neither pays the money required to be paid under the order nor files an appeal by May 31, 2002 (within 30 days of the order being served as required under s. 116(4)).
In this example, the Ministry at its discretion may prosecute the employer for failure to pay overtime, in which case prosecution must commence with two years of November 15, 2001, or the ministry may elect to prosecute for failure to comply with the order to pay, in which case the prosecution must commence within two years of the date the order was served, May 31, 2002.
Given that there is more time to commence a prosecution if the prosecution is for failure to comply with an order to pay, rather than where it is for failure to pay the wages on the regular pay day as required by the Act, why would the Crown ever be required to proceed within the latter period? The answer is that if the Crown wishes to prosecute the directors of the corporation under s. 137(1) of the Act for authorizing, permitting or acquiescing in the violation by the corporation, it may, in some situations, be more appropriate if the violation, which is the foundation of the prosecution, is considered to be the employer's failure to pay the wages on the regular pay day, rather than the subsequent failure to comply with the order to pay. This might be because the directors were no longer associated with the corporation at the time the order was served, but had been associated with the corporation at the time the wages first became owed to the employee.
See ESA Part XXII, s. 114 for further discussion of limitation periods for orders and notices.
A prosecution under Part III of the Provincial Offences Act, R.S.O. 1990, c. P.33 is generally considered to commence when a document called an "information" is laid under oath before a provincial judge or a justice of the peace.
The intent of Part XXVI of the Employment Standards Act, 2000 is to establish certain evidentiary rules for prosecutions and proceedings under the Act.
This provision is substantially the same as the corresponding section (s. 80(1)(a)) in the former Employment Standards Act. Section 140(1) means that in a prosecution or proceeding under the Act, a copy of an order or notice of contravention that appears to have been signed by an employment standards officer or the Board is evidence of the order or notice and the facts contained therein without proof of the signature or office of the person who appears to have signed it.
This section does not mean that the copy is irrefutable proof of the order or notice and the facts contained therein. It merely means that it is evidence that can be rebutted by contrary evidence.
This provision is substantially the same as the corresponding section (s. 80(1)(b)) in the former Employment Standards Act. Section 140(2) means that in a prosecution or proceeding under the Act, a copy of a record or other document or a copy of an extract from a record or other document that appears to have been certified as a true copy or accurate extract by an employment standards officer is evidence of the record or document or extracted part of the record or document and the facts contained therein without proof of the signature or office of the person who appears to have certified it or any other proof.
This section does not mean that a certified copy or extract is irrefutable proof that it is a true copy or extract and that the facts contained therein are true. It merely means that it is evidence that can be rebutted by contrary evidence.
This provision was amended by the Employment Standards Amendment Act (Temporary Help Agencies), 2009 effective November 6, 2009 to reflect the fact that orders and notices of contravention may be issued to a "person" (e.g. a client of a temporary help agency) and not just an employer.
Section 140(3) states that in a proceeding or prosecution under the Act, a certificate that appears to be signed by the Director setting out that a person has failed to make any payment under an order or notice of contravention issued under the Act is evidence of the failure to pay without any further proof.
The section does not mean that such a certificate is irrefutable proof of non-payment. It merely means that it constitutes evidence of the non-payment, which may be rebutted by contrary evidence.
The section refers to "an order or notice of contravention issued under this Act" and therefore would include orders issued by employment standards officers, as well as orders issued by an arbitrator (pursuant to s. 100) or by the Board.
The Director of Employment Standards has not delegated this power.
This provision is substantially the same as the corresponding section (s. 80(3)) in the former Employment Standards Act.
Section 140(4) sets out various facts relating to the functioning of private collectors, which the Director of Employment Standards may certify. The section does not mean that the certificate of the Director is irrefutable proof of the facts set out therein. It merely means that it constitutes evidence of such facts, which may be rebutted by contrary evidence.
The Director of Employment Standards has not delegated this power.
This provision is substantially the same as the corresponding section (s. 80(4)) in the former Employment Standards Act.
Section 140(5) recognizes that the Director of Employment Standards can issue a certificate setting out the date on which the records of the ministry indicate that a complaint was filed. This date is important with regards to the limitation periods in the Act (e.g., ss. 96(3) and 114) and s. 111, which creates a limit on the recovery of monies under the Act. The certificate of the Director under this subsection is evidence of that date without further proof. The section does not mean, however, that the certificate of the Director is irrefutable proof of the date. It merely means that it constitutes evidence of such a fact, which may be rebutted by contrary evidence.
The Director of Employment Standards has not delegated this power.
Statutes enacted by Ontario's Legislature often delegate the authority to make further laws to the Lieutenant Governor in Council (in effect the Cabinet). These additional laws, referred to as regulations, may, among other things, establish exemptions from the statute, set out detailed rules to complement what is in the statute, vary the rules or create additional rules to what is in the statute, provide definitions, etc.
Part XXVII of the Employment Standards Act, 2000 contains s. 141, which sets out the type of regulations that the Legislature has authorized the Lieutenant Governor in Council to make. A number of regulations have been made using this authority. In interpreting these regulations, some general rules of interpretation should be remembered.
Firstly, the same rules of interpretation apply to regulations as to the statute itself.
Secondly, and probably most importantly, regulations are subordinate to the Employment Standards Act, 2000. If there is a conflict between a provision in the statute and a provision in a regulation, the statute prevails. (Note, however, that if the statute authorizes the making of regulations that create different rules than those set out in the Act, the regulation will, generally speaking, not be invalid.)
Thirdly, a regulation will not be considered to be valid, even if it is not in conflict with the Act if the Act does not authorize the making of the regulation.
Finally, it should be noted that the regulations made under the former Employment Standards Act, 2000 would continue to apply (where relevant), with respect to matters governed by the former Employment Standards Act, 2000.
Part XXVIII of the Employment Standards Act, 2000 provides transitional provisions, amendments to the former Employment Standards Act, the repeal of five employment-related statutes, a provision for the Act to come into force on a date to be proclaimed by the Lieutenant Governor and the official short title of the Act.
Section 142(1) provides that Part XIV.1 of the Employment Standards Act will continue to apply, even though the former Employment Standards Act was repealed on September 4, 2001. See ESA Part XXVIII, s. 144 for further discussion.
Part XIV.1 of the former Act provides for employee eligibility for compensation for unpaid wages that were due and owing under the Employee Wage Protection Program, prior to the Program's discontinuance on October 29, 1997, by the Public Sector Transition Stability Act, 1997.
As of September 4, 2001, the application of Part XIV.1 of the former Employment Standards Act is limited to situations where:
For further information on the history and application of Part XIV.1 of the former Employment Standards Act, please see Legislative History.
Section 38(1) of the former Employment Standards Act provided that an employee must commence parental leave no more than 35 weeks after the day in which the child was born or came into the employee's custody, care and control for the first time.
Section 143(1) of the Employment Standards Act, 2000 amended s. 38 of the former Employment Standards Act by including s. 38(2.1). Section 38(2.1) extended the deadline for commencing parental leave to 52 weeks for any employee whose child was born or came into their custody, care and control for the first time on or after December 31, 2000.
Please see the discussion on pregnancy and parental leave in Legislative History for further information.
Section 40 of the Employment Standards Act provided that an employee was entitled to 18 weeks of parental leave with regards to the birth or the coming into custody, care and control of a child.
Section 143(2) amended section 40 of the former Employment Standards Act by adding a new subsection (s. 40(2)). Section 40(2) increased the entitlement to parental leave for any employee whose child was born or came into their custody, care and control for the first time on or after December 31, 2000. Parental leave for such employees was extended from 18 weeks to 35 weeks, for an employee who took pregnancy leave. For employees who did not take pregnancy leave, parental leave was extended to 37 weeks.
Please see the discussion on pregnancy and parental leave in Legislative History for further information.
On September 4, 2001, the Employment Standards Act, 2000 was proclaimed in force. It replaces the former Employment Standards Act as the legislation governing employment standards entitlements for the majority of Ontario workplaces.
With the coming into force of the Employment Standards Act, 2000, the former Employment Standards Act and s. 143 of the Employment Standards Act, 2000 were repealed. Please note, however, that the repeal of s. 143 of the Employment Standards Act, 2000 and the former Employment Standards Act does not affect any rights or entitlements that employees had under the former Employment Standards Act prior to September 4, 2001. The Employment Standards Act, 2000 cannot be retroactively applied. Instead, the Employment Standards Act, 2000 takes effect and only replaces the former Employment Standards Act as of September 4, 2001.
Wally files a complaint on December 3, 2001, that he has not been paid wages for 8 hours of work he performed on July 27, 2001. The amount should have appeared on his August 10, 2001, pay cheque, which covers the pay period July 15, 2001, to July 28, 2001.
Wally earned the wages for 8 hours of work on July 27, 2001, but the wages did not become due until August 10, 2001, the pay day for the pay period which covers July 27, 2001.
Even though the complaint was filed after the coming into force of the Employment Standards Act, 2000, both the date the wages were earned (July 27, 2001) and the date the alleged contravention of an employment standard (August 11, 2001 - one day after the pay cheque was due) occurred prior to September 4, 2001.
Therefore, the former Employment Standards Act would govern the investigation and available remedies for the alleged contravention. An order to pay for a contravention of s. 7(3) would be issued by an employment standards officer under s. 65(1.2) of the former Employment Standards Act.
Dana files a complaint on November 20, 2001, that her employer did not pay the premium rate for work she performed on Labour Day, 2001 (September 3, 2001). The amount was due on her September 15, 2001, pay cheque which covered the pay period August 26 to September 8, 2001.
The alleged contravention of an employment standard occurred when the employer failed to pay the premium rate on September 15, 2001. Although September 15 occurs after the coming into force date of the Employment Standards Act, 2000, the entitlement to the premium rate arose when it was earned on Labour Day, which was prior to the coming into force of the Employment Standards Act, 2000 on September 4, 2001.
The date of the entitlement to the premium rate (September 3, 2001) and not the date upon which it became due (September 15, 2001) is the determining date of which Act governs the investigation and available remedies for Dana's claim.
Therefore, an order to pay for a contravention of s. 7(3) would be issued by an employment standards officer under s. 65(1.2) of the former Employment Standards Act.
April files a complaint on January 7, 2002, that her employer did not reinstate her to her position at the end of her parental leave on December 31, 2001.
The parental leave had commenced on May 1, 2001. Although the leave ended after the coming into force of the Employment Standards Act, 2000, the leave commenced prior to the coming into force of the Employment Standards Act, 2000 on September 4, 2001.
The date the leave commenced (and not the date the leave ended) is the determining date of which Act governs the investigation and available remedies for April's claim.
Therefore an order for compensation for a contravention of s. 43 of the former Employment Standards Act would be issued by an employment standards officer under s. 45 of the former Employment Standards Act.
Glenda files a complaint on May 29, 2002, that she was not reinstated to her position at the end of her parental leave on May 20, 2002.
Glenda had commenced a pregnancy leave on May 21, 2001, and that leave had ended on September 17, 2001. Her parental leave commenced on September 17, 2001, after the Employment Standards Act, 2000 came into force.
Because Glenda's complaint concerns her rights to reinstatement following her parental leave, the date the parental leave commenced is the determining date of which Act governs the investigation and available remedies for Glenda's claim.
Therefore an order for compensation and/or reinstatement for a contravention of s. 53 of the Employment Standards Act, 2000 would be issued by an employment standards officer under s. 104 of that Act.
The One Day's Rest in Seven Act, R.S.O. 1990, c. O.7, provided that hospitality industry workers in towns with a population greater than 10,000 would have to receive at least one day off work in every seven-day period. The Act required that, if possible, the day off be a Sunday. Watchmen, janitors, supervisors, managers and certain part-time workers were excluded from the Act. A violation of the Act was subject to a maximum fine of $25,000. The One Day's Rest in Seven Act was repealed on September 4, 2001.
Section 18(4) of the Employment Standards Act, 2000 now provides a general entitlement for a period free from the performance of work of at least 24 consecutive hours in every work week or at least 48 consecutive hours in every two consecutive work weeks. The weekly and bi-weekly rest entitlements provided in s. 18(4) are applied to employees generally and are not limited to hospitality industry workers within towns with a population greater than 10,000.
For further information on the application of s. 18(4), please see ESA Part VII, s. 18(4).
The Government Contracts Hours and Wages Act, R.S.O. 1990, c. G.8, was first enacted in 1936. It was enacted to establish a legislative foundation for a government fair wage policy for hours of work and wages for workers employed by private sector employers who were carrying out construction contracts for the provincial government.
The Government Contracts Hours and Wages Act was repealed on September 4, 2001. It should be noted, however, that in recent years, the government's fair wage policy has been established pursuant to an order-in-council independently of the Government Contracts Hours and Wages Act. The repeal of the Government Contracts Hours and Wages Act, therefore, has no impact on the current fair wage policy.
The Employment Agencies Act, R.S.O. 1990, c E.13, required that employment agencies, whether engaged in finding employees for employers or in finding employers for employees, be licensed. This Act was repealed on March 31, 2001. As a result, employment agencies in Ontario are no longer required to obtain a licence to operate.
The Industrial Standards Act, R.S.O. 1990, c I.6, was first enacted in 1935. It provided a means for establishing minimum standards for hours, wages and other working conditions for specific industries that were different from the entitlements provided under the former Employment Standards Act. These entitlements were set out in schedules contained in regulations under the former Employment Standards Act.
By the time of the former Employment Standards Act's repeal on September 4, 2001, only two industries were covered by active schedules: the women's coat and suit industry and the women's dress and sportswear industry. Entitlements for these two industries are now set out in O. Reg. 291/01 (Terms and Conditions of Employment in Defined Industries) under the Employment Standards Act, 2000.
Section 143 of the Employment Standards Act, 2000 was proclaimed into force as of December 30, 2000, amending the parental leave provisions of the former Employment Standards Act. Subsection 144(4) of the Employment Standards Act, 2000, providing for the repeal of the Employment Agencies Act, was proclaimed in force as of March 31, 2001. All remaining provisions of the Employment Standards Act, 2000 (including s. 144(1) which repealed s. 143) were proclaimed in force as of September 4, 2001.
All bills introduced in the Legislative Assembly contain both a long title and a short title. However, once the bill receives Royal Assent, the statute created by the bill will for convenience usually be referred to only by its short title.
O. Reg. 66/20 was made on March 19, 2020 but pursuant to section 3 was deemed to have come into force on January 25, 2020. It prescribed certain matters related to infectious disease emergency leave.
On May 29, 2020, O. Reg. 66/20 was revoked and replaced by O. Reg.. 228/20. All of the substantive provisions of O. Reg. 66/20 were maintained in O. Reg. 228/20 - see O. Reg. 228/20 for details.
This regulation sets out how to determine which portion of service charge or similar charge imposed on an employer by a credit card company can be used to offset the amount of a tip or other gratuity owed to an employee by an employer under the Employment Standards Act, 2000.
O Reg 125/16 came into force on June 10, 2016. Clause (f) of the definition of “tip or other gratuity” in subsection 1(1) states that “tip or other gratuity” does not include such charges as may be prescribed relating to the method of payment used, or a prescribed portion of those charges. Accordingly, this regulation sets out what is not included for the purposes of clause (f) of the definition.
The regulation excludes some of the credit card processing fees from the definition of “tip or other gratuity”. The amount that is excluded is determined by calculating the greater of: a) the amount of the tip or other gratuity multiplied by the per cent charged by the credit card company for processing the payment, or b) the amount of the tip or other gratuity multiplied by 1.5%.
By virtue of this exclusion, the amount that results from applying the formula in paragraph (1) is not governed by the rules in Part V.1 of the Act that prohibit employers from withholding tips or other gratuities from employees.
As such, where tips or other gratuities are paid by a customer on a credit card, an employer can deduct or withhold the amount that results from applying the formula in paragraph (1) from the amount of the tip or gratuity that was provided by the customer.
For example:
This regulation addresses credit card processing fees only. Employers are not permitted to deduct or withhold from an employee’s tips or other gratuities any amounts representing debit card processing fees or any other type of processing fee.
This regulation sets out special rules for certain employees engaged in the mineral exploration industry and the mining industry. Currently, the regulation’s scope is limited to days free from work.
O Reg 159/05 came into effect on March 31, 2005.
Section 1(1) defines two industries to which O Reg 159/05 applies: the "mineral exploration" industry and the "mining" industry. (Note, however, that by virtue of s. 2, the regulation applies only to certain employees in the industry.)
"Mineral exploration" is defined to mean prospecting, staking or exploration for minerals and related activities, and includes advanced exploration (such as the excavation of an exploratory shaft, adit or decline, the extraction of minerals for the purpose of proving a mineral deposit, and the installation of a mill for test purposes), and site rehabilitation. It should be noted that this is an inclusive definition rather than exhaustive. Other kinds of work might qualify as "related activities" to mineral exploration even though they are not listed in this s. 1 definition.
"Mining" is defined to mean the extraction, concentration and smelting of economic minerals from a mineral deposit for commercial purposes. "Mine" has a corresponding meaning.
Section 2 narrows the scope of O Reg 159/05, by restricting its application in the following ways:
The terms "mineral exploration" and "mining" are both defined in s. 1 of O Reg 159/05.
Section 3 simply states that O Reg 159/05 sets out terms and conditions of employment that apply to those employees and employers in the defined industries of mineral exploration and mining described in s. 2.
Section 4(1) of O Reg 159/05 provides that, where the employer and employee in the defined industry agree, ss. 4(2) and 4(3) apply instead of s. 18(4) of the Employment Standards Act, 2000:
There can be no substitution of ss. 4(2) and (3) of O Reg 159/05 for s. 18(4) of the Act unless the employer and employee (or union) agree. Agreements to substitute the rest period requirement in s. 4 of O Reg 159/05 for the requirement in s. 18(4) of the Act must be in writing in order to be valid. See ESA Part I, s. 1(3) and ESA Part 1, s. 1(3.1) for a full discussion of the requirements regarding written agreements.
Under s. 4(2) of O Reg 159/05, the requirement to provide a period of at least 24 consecutive hours free from performing work in every work week or at least 48 consecutive hours free from performing work in every period of two consecutive work weeks (under s. 18(4) of the Act), is replaced, if the employer and employee agree, by a provision that the employer not require or permit the employee to perform work on more than 28 consecutive days.
Subsection 4(3) of O Reg 159/05 then provides a formula for determining the days free from work that an employee is given following the work period of no more than 28 consecutive days, as follows:
Like s. 18(4) of the Act which it replaces, the maximum days of work permitted in s. 4(2) and the alternate rest period in s. 4(3) of O Reg 159/05 are employment standards as defined in s. 1(1) of the Act and cannot be contracted out of or waived (s. 5(1) of the Act). An employer and an employee (or union) cannot, for example, agree that the employee will work more than twenty-eight days in a row or take fewer consecutive days free from work than would be required under the s. 4(3) formula. Once an employer and employee (or union) in the defined industry have agreed to vary from the weekly/biweekly rest provisions in s. 18(4) of the Act and to substitute the provisions in s. 4 of O Reg 159/05, the employer cannot require or permit more consecutive days of work than 28 days in a row and the employee cannot be given fewer consecutive days free from work than outlined in the s. 4(3) formula. There is no "switching back and forth" between the requirements of s. 18(4) and the alternate rest periods provided in s. 4(3) of the Regulation as the Regulation operates in lieu of s. 18(4).
The requirement in s. 4(2) that the employer not require or permit the employee to perform work on more than 28 consecutive days and the formula in s. 4(3) for determining the days free from work that an employee is given following the work period of no more than 28 consecutive days, operate simultaneously with the hours of work provisions in Part VII of the Act, as follows:
Section 17(1) of the ESA 2000 provides for maximum daily hours of work of eight hours per day or, if there is an established workday that is longer than eight hours, the number of hours in that work day. However, under s. 17(2) of the Act, employers and employees can agree, in writing, that the employee will work up to a specified number of hours in excess of the daily limit. For such an agreement to be valid, s. 17(5) requires that non-unionized employees first be provided with a copy of the Ministry of Labour’s information sheet on hours of work and overtime and that the agreement contains a statement by the employee acknowledging such receipt.
For further details about the maximum daily hours of work set out in s. 17(1); about agreements to vary from the maximum daily hours in s. 17(2); and about the requirement to provide the Ministry's information sheet as set out in s. 17(5), see ESA Part VII, s. 17.
Section 17(1) of the ESA 2000 provides for maximum weekly hours of work of 48 hours. However, under s. 17(3) of the Act, employers and employees can agree, in writing, that the employee will work up to a specified number of hours in excess of the weekly limit. For such an agreement to be valid, s. 17(5) requires that non-unionized employees first be provided with a copy of the Ministry of Labour's information sheet on hours of work and overtime and that the agreement contains a statement by the employee acknowledging such receipt.
For further details about the maximum weekly hours of work set out in s. 17(1); about agreements to vary from the maximum weekly hours in s. 17(3); and about the requirement to provide the Ministry's information sheet as set out in s. 17(5), see ESA Part VII, s. 17.
Section 18(1) of the ESA 2000 requires that an employee be free from performing work for a particular employer for a period of at least 11 consecutive hours in each day. This requirement is subject to s. 18(2) (on-call employees) and s. 19 (exceptional circumstances).
For a discussion of the daily rest requirement in s. 18(1) of the Act, see ESA Part VII, s. 18.
Section 18(2) of the ESA 2000 sets out an "on-call exception" to s. 18(1) of the Act.
Under s. 18(2), the requirement that an employee have at least 11 hours free from performing work in each day (in accordance with s. 18(1) of the Act) does not apply to an employee who is on call and is called in during a period he or she would not otherwise have been expected to work. The on-call exception is an exception only to the requirement to provide 11 consecutive hours free from work each day as per s. 18(1); it does not operate as an exception to any other hours of work provisions.
For a discussion of the on-call exception in s. 18(2) of the Act, see ESA Part VII, s. 18 of the Manual.
Section 18(3) of the Act requires employers to provide employees with a minimum period free from work of eight hours between successive shifts, with two exceptions. First, an employee may work successive shifts without the eight-hour free period if the total number of hours worked on the successive shifts is 13 or less. Second, the employer and employee can agree, in writing, to forego the eight-hour period entirely or to reduce its length. For a discussion of the interaction of s. 18(3) with the required daily rest in s. 18(1) of the Act, see ESA Part VII, s. 18 of the Manual.
Section 19 of the ESA 2000 allows employers to require employees to work more daily or weekly hours than are permitted under s. 17 of the Act, or to work during a free period (daily, in between shifts and weekly or biweekly) as required by s. 18 of the Act (and s. 4 of O Reg 159/05) in any of the specified circumstances, but only so far as is necessary to avoid serious interference with the ordinary working of the employer’s establishment or operations.
For a discussion of the exceptional circumstances set out in s. 19 of the Act, see ESA Part VII, s. 19 of the Manual.
Under s. 20 of the ESA 2000, an employer is required to provide an eating period of at least 30 minutes, timed so that no employee works longer than five consecutive hours without receiving an eating period, or, if the employer and employee agree (not necessarily in writing), two eating periods that together total at least 30 minutes within the same period of five consecutive hours.
For further details about eating periods in s. 20 of the Act, see ESA Part VII, s. 20.
This regulation sets out special rules for the terms and conditions of employment for employees engaged in the production of live performances (e.g., theatre, dance, comedy, etc.), trade shows and conventions. Currently, the regulation’s scope is limited to hours free from work.
O Reg 160/05 came into effect on March 31, 2005.
Section 1 defines the industry to which O Reg 160/05 applies, to mean the industry of producing live performances of theatre, dance, comedy, musical productions, concerts and opera as well as trade shows and conventions.
Section 1 defines "technical and production support" to include the following activities: stage and set construction, hair cutting and styling, the preparation and fitting of wigs and costumes, the preparation and application of make-up, the preparation and operation of lighting, sound and stage equipment and props, and stage management.
It should be noted that this is an inclusive definition rather than exhaustive. Other kinds of work might qualify as "technical and production support" even though they are not listed in this s. 1 definition.
The terms “defined industry” and “technical and production support” are both defined in s. 1 of O Reg 160/05.
Section 3 simply states that O Reg 160/05 sets out terms and conditions of employment that apply to employers and employees in the defined industry of live performances, trade shows and conventions.
Section 4(1) of O Reg 160/05 provides that, where the employer and employee in the defined industry agree, s. 4(2) applies instead of s. 18(1) of the Employment Standards Act, 2000:
18(1) An employer shall give an employee a period of at least 11 consecutive hours free from performing work in each day.
Under s. 4(2) of O Reg 160/05, the period of at least 11 consecutive hours free from performing work in each day (in s. 18(1) of the Act) is replaced by a period of at least eight consecutive hours free from performing work in each day. See ESA Part VII, s. 18(1) for a discussion of the meaning of "day".
There can be no substitution of s. 4(2) for s. 18(1) of the Act unless the employer and employee (or union) agree. An agreement to substitute the eight-hour daily rest period in s. 4(2) for the eleven-hour daily rest period in s. 18(1) of the Act must be in writing. See ESA Part I, s. 1(3) for a full discussion of the requirements regarding written agreements.
Like s. 18(1) of the Act which it replaces, the daily rest in s. 4(2) of O Reg 160/05 is an employment standard as defined in s. 1(1) of the Act and cannot be contracted out of or waived (s. 5(1)). An employer and employee (or union) in the defined industry could not, for example, agree to a six-hour daily rest period.
For a discussion of how the 11-hour daily rest operates, see s. 18(1) of the Act. (Substitute "eight hours" for "11 hours" each time it appears in order to understand the operation of the eight-hour daily rest period under s. 4(2) of O Reg 160/05.)
The requirement in s. 4(2) for at least eight consecutive hours off work in each day operates simultaneously with the hours of work provisions in Part VII of the Act, as follows:
Section 18(2) of the ESA 2000 sets out an "on-call exception" to s. 18(1) of the Act. This exception also applies if the daily rest period is eight consecutive hours as per s. 4(2) of O Reg 160/05, when it replaces the 11-hour daily rest requirement in s. 18(1) in the defined industry.
Under s. 18(2), the requirement that an employee have at least 11 hours free from performing work in each day (in accordance with s. 18(1) of the Act) or at least eight hours free from performing work in each day (in accordance with s. 4(2) of O Reg 160/05) does not apply to an employee who is on call and is called in during a period he or she would not otherwise have been expected to work. The on-call exception is an exception only to the requirement to provide 11 or eight consecutive hours free from work each day as per s. 18(1) of the Act or s. 4(2) of O Reg 160/05. It does not operate as an exception to any other hours of work provisions.
For a discussion of the on-call exception, see s. 18(2) of the Act. Substitute s. 4(2) of O Reg 160/05 for s. 18(1) of the Act, and substitute eight hours for 11 hours, wherever the references appear.
Section 17(1) of the ESA 2000 provides for maximum daily hours of work of eight hours per day or, if there is an established workday that is longer than eight hours, the number of hours in that work day. However, under s. 17(2) of the Act, employers and employees can agree, in writing, that the employee will work up to a specified number of hours in excess of the daily limit. For such an agreement to be valid, s. 17(5) requires that non-unionized employees first be provided with a copy of the Ministry of Labour’s information sheet on hours of work and overtime and that the agreement contains a statement by the employee acknowledging such receipt.
For further details about the maximum daily hours of work, see ESA Part VII, s. 17(1); about agreements to vary from the maximum daily hours, see ESA Part VII, s. 17(2); and about the requirement to provide the Ministry's information sheet, see ESA Part VII, s. 17(5)
Section 17(1) of the ESA 2000 provides for maximum weekly hours of work of 48 hours. However, under s. 17(3) of the Act, employers and employees can agree, in writing, that the employee will work up to a specified number of hours in excess of the weekly limit. For such an agreement to be valid, s. 17(5) requires that non-unionized employees first be provided with a copy of the Ministry of Labour's information sheet on hours of work and overtime and that the agreement contains a statement by the employee acknowledging such receipt.
For further details about the maximum weekly hours, see ESA Part VII, s. 17(1).; about agreements to vary from the maximum weekly hours, see ESA Part VII, s. 17(3); and about the requirement to provide the Ministry’s information sheet, see ESA Part VII, s. 17(5).
Section 18(3) of the Act requires employers to provide employees with a minimum period free from work of eight hours between successive shifts, with two exceptions. First, an employee may work successive shifts without the eight-hour free period if the total number of hours worked on the successive shifts is 13 or less. Second, the employer and employee can agree, in writing, to forego the eight-hour period entirely or to reduce its length. For a discussion of the interaction of s. 18(3) with the required daily rest in s. 18(1) of the Act, see s. 18(3).
Per s. 4 of O Reg 160/05, an employee and employer in the defined industry could agree in writing to a minimum daily rest of 8 hours (instead of the 11 hours in s. 18(1) of the Act). That employee could then agree in writing to work an eight and a 10-hour shift back to back, without any break between them. The agreement in writing would comply with s. 18(3) of the Act, but if it resulted in the employee receiving a daily rest of less than eight consecutive hours (per the agreement under s. 4 of O Reg 160/05), the schedule would be in violation of O Reg 160/05 and, therefore, would not be permitted. In other words, an employee in the defined industry cannot agree to work hours under s. 18(3) of the Act that would result in the employee getting less than the eight consecutive hours free from work each day stipulated in s. 4(2) of O Reg 160/05.
Section 18(4) of the ESA 2000 establishes weekly or bi-weekly free time requirements for employees. The free time periods must be at least either 24 consecutive hours in every "work week" or 48 consecutive hours in every two consecutive "work weeks".
See ESA Part VII, s. 18(4) for a discussion of the weekly/biweekly rest period provisions.
Section 19 of the ESA 2000 allows employers to require employees to work more daily or weekly hours than are permitted under s. 17 of the Act, or to work during a free period (daily, in between shifts and weekly or biweekly) as required by s. 18 of the Act (and s. 4(2) of O Reg 160/05) in any of the specified circumstances, but only so far as is necessary to avoid serious interference with the ordinary working of the employer’s establishment or operations.
For a discussion of the exceptional circumstances, see ESA Part VII, s. 19.
Under s. 20 of the ESA 2000, an employer is required to provide an eating period of at least 30 minutes, timed so that no employee works longer than five consecutive hours without receiving an eating period, or, if the employer and employee agree (not necessarily in writing), two eating periods that together total at least 30 minutes within the same period of five consecutive hours.
For further details about eating periods, see ESA Part VII, s. 20.
O. Reg. 228/20 – Infectious Disease Emergency Leave - was filed on May 29, 2020. It revoked and replaced O. Reg. 66/20, which had the same title.
As of May 29, 2020, O. Reg. 228/20:
O. Reg. 228/20 initially defined the “COVID-19 period” to be retroactive to March 1, 2020 and to extend until six weeks after the day the emergency declared by Order in Council 518/2020 (Ontario Regulation 50/20) pursuant to the Emergency Management and Civil Protection Act is terminated or disallowed. That emergency was terminated on July 24, 2020, which meant the final day of the COVID-19 period was initially set to be September 4, 2020. However, the definition of the “COVID-19 period” was subsequently amended several times:
As such, the “COVID-19 period” is March 1, 2020 to July 30, 2022.
O. Reg. 228/20 was amended on August 24, 2020 to prescribe an additional reason pursuant to clause (vii) of s. 50.1(1.1)(b) of the ESA for which employees are entitled to unpaid infectious disease emergency leave, retroactive to July 24, 2020: an order made under s. 7.0.2 of the Emergency Management and Civil Protection Act that is continued under the Reopening Ontario (A Flexible Response to COVID-19) Act, 2020, or any amendment to such an order, that relates to the designated infectious disease applies to the employee.
O. Reg. 228/20 was amended on August 31, 2021 to prescribe, in s. 11, a later end date for entitlements to paid infectious disease emergency leave.
Subsection 1(1) provides the definition of the term “COVID-19 period”. This term is used in several provisions of the regulation to establish the time period during which certain rules in the regulation apply.
“COVID-19 period” means the period beginning on March 1, 2020 and ending on July 30, 2022. Given that the “COVID-19 period” is over, the temporary rules established by the regulation that applied only during this time are no longer in effect.
The definition of “COVID-19 period” in s. 1(1) originally provided that it ended on the date that is six weeks after the day the COVID-19 declared emergency (i.e. the emergency declared by Order in Council 518/2020 – O. Reg. 50/20 - on March 17, 2020) is terminated or is disallowed by the Legislature. As that emergency was terminated on July 24, 2020, the final day of the COVID-19 period was originally set to be September 4, 2020. The definition was amended on September 3, 2020 to extend the COVID-19 period to January 2, 2021, on December 17, 2020 to extend the COVID-19 period to July 3, 2021, on June 4, 2021 to extend the COVID-19 period to September 25, 2021, on September 16, 2021 to extend the COVID-19 period to January 1, 2022, and on December 9, 2021 to extend the COVID-19 period to July 30, 2022. The COVID-19 period has now expired.
Subsection 1(2) provides that certain provisions of O. Reg. 228/20 do not apply to employees who are represented by a trade union.
It does not matter for the purposes of ss. 1(2) whether or not the unionized employees are covered by a collective agreement. So long as the employees are represented by a trade union, the specified provisions do not apply to them. If an employee is or was represented by a trade union for only part of the COVID-19 period (e.g. a trade union was certified to represent the employee on March 27, 2020) and the employee meets the conditions for the deemed leave and other specified provisions, the specified provisions will not apply to the employee during the time the employee is or was represented by the trade union but will apply during the rest of the COVID-19 period.
The provisions that do not apply to employees who are represented by a trade union are:
Subsection 2(1) establishes which diseases are designated as infectious diseases for the purposes of unpaid infectious disease emergency leave in ESA Part XIV, s. 50.1 (and paid infectious disease emergency leave from April 19, 2021 to March 31, 2023). It establishes that diseases caused by a novel coronavirus are designated as infectious diseases. The provision specifically names Severe Acute Respiratory Syndrome (SARS), Middle East Respiratory Syndrome (MERS) and coronavirus (COVID-19). Note, however, that the list of diseases is an inclusive list. This means that there may be other diseases caused by a novel coronavirus that are also designated as infectious diseases for the purposes of infectious disease emergency leave.
Subsection 2(2) says that despite ss. 2(1), COVID-19 is designated as an infectious disease with respect to the reason prescribed in paragraph 1 of ss. 4(1) (i.e. where an employer temporarily reduced or temporarily eliminated an employee’s hours of work for reasons related to the designated infectious disease) only during the COVID-19 period. The COVID-19 period is defined in s. 1 to start on March 1, 2020 and to end on July 30, 2022. As the defined COVID-19 period is now over, COVID-19 is no longer designated as an infectious disease with respect to the reason prescribed in paragraph 1 of ss. 4(1).
Pursuant to ss. 1(2) of O. Reg. 228/20, ss. 2(2) does not apply to employees who are represented by a trade union.
Section 2 must be read subject to ss. 3, 3.1(2) and 4(1.1) of O. Reg. 228/20, which establish start dates for the different reasons that create an entitlement to upaid infectious disease emergency leave. At the time of writing, coronavirus (COVID-19) was the only infectious disease for which there is a start date. This means that at the time of writing, even though there are additional diseases designated as infectious diseases per section 1, the only disease for which unpaid infectious disease emergency leave may be taken is coronavirus (COVID-19).
ESA Part XIV, s. 50.1(5.1) provides that “An employee is entitled to take a leave under clause (1.1)(b) [unpaid infectious disease emergency leave] starting on the prescribed date.”
Subsection 3(1) prescribes a start date for the entitlement to unpaid infectious disease emergency leave because of a reason related to coronavirus (COVID-19) set out in subclauses 50.1(1.1)(b)(i)-(vi) of the ESA. Pursuant to ss. 3(1), the entitlement related to these reasons is deemed to have started on January 25, 2020. (Paid infectious disease emergency leave has a different start date, and a specified end date: see ss. 50.1(5.2) of the ESA and s. 11 of O. Reg. 228/20 for details.)
Different start dates are prescribed for other reasons giving rise to the entitlement to unpaid infectious disease emergency leave:
Note that this regulation does not prescribe a start date for an entitlement to unpaid infectious disease emergency leave with respect to any of the other designated infectious diseases set out in O. Reg. 228/20, s. 2 (i.e., other diseases caused by a novel coronavirus, including Severe Acute Respiratory Syndrome (SARS) and Middle East Respiratory Syndrome (MERS)). As such, at the time of writing, employees are not entitled to take unpaid infectious disease emergency leave with respect to any of the other designated diseases; the entitlement arises pursuant to s. 3 only in respect of the coronavirus (COVID-19).
Note that this regulation provides an entitlement to unpaid infectious disease emergency leave for a reason related to Coronavirus (COVID-19) that is:
This means that an employee could retroactively designate absences from work for a reason set out in subclauses (i)-(iv) of s. 50.1(1.1)(b) between January 25, 2020 and March 18, 2020 (prior to when the infectious disease regulation was first put in place) as unpaid infectious disease emergency leave if the employee met the required eligibility criteria (i.e., a reason listed in s. 50.1(1.1)(b)(i)-(vi)) for the leave at that time. A retroactive leave of this nature raises a number of practical questions. For more information, see the discussion in ESA Part XIV, s. 50.1.
It also means that an employee is retroactively deemed to have been on unpaid infectious disease emergency leave in respect of any time the employee did not perform the duties of his or her position because the employer temporarily reduced or eliminated the employee’s hours of work for COVID-19 related reasons from March 1, 2020 to May 28, 2020 (prior to O. Reg. 228/20 being filed).
With respect to the reason prescribed in paragraph 1 of ss. 3.1(1) of O. Reg. 228/20 (i.e., certain orders issued under the Emergency Management and Civil Protection Act that are continued under the Reopening Ontario (A Flexible Response to COVID-19) Act, 2020 apply to the employee): although the regulation was amended August 24, 2020 to prescribe this reason and provide that the entitlement is retroactive to July 24, 2020, it was Program policy that employees in the situation described in the regulation were entitled to unpaid infectious disease emergency leave through clause (iii) of s. 50.1(1.1)(b) and that the amendment simply provides greater certainty that employees who are subject to such orders are entitled to the leave.
Clause 50.1(1.1)(b) of the ESA sets out the reasons for which an employee may take unpaid infectious disease emergency leave. Subclause (vii) of that provision provides that additional reasons may be prescribed by regulation.
Subsection 3.1(1) prescribes an additional reason that qualifies an employee for unpaid infectious disease emergency leave: an order made under section 7.0.2 of the Emergency Management and Civil Protection Act (EMCPA)that is continued under the Reopening Ontario (A Flexible Response to COVID-19) Act, 2020 (ROA), or any amendment to such an order, that relates to the designated infectious disease applies to the employee.
When the ROA came into force on July 24, 2020, some emergency orders that were initially made under section 7.0.2 of the EMCPA when the first declared emergency for COVID-19 was in effect (March 17, 2020 to July 24, 2020) ceased to be EMCPA orders but were continued under the ROA.
As per s. 3.1 of O. Reg. 228/20, employees who are not performing their duties because any such orders apply to them are entitled to unpaid infectious disease emergency leave.
The Program considers an order to “appl[y] to” an employee only if the order is directed at the employee, i.e., where the employee, either individually or as part of a group, is the subject of the requirement, prohibition or other direction made in the order.
In other words, this condition is not satisfied if an employee is only indirectly affected by the order or by the consequences of someone else complying with the order.
For example, an order that requires restaurants to close “applies to” the owners of restaurants. It does not apply to the employees of restaurants, even though they are affected by the closure.
The orders referred to as “one employer” and “one location” orders (O. Reg. 158/20 – “Limiting Work to a Single Retirement Home”, O. Reg. 146/20 – “Limiting Work to a Single Long-Term Care Home”, and O. Reg. 177/20 “Congregate Care Settings”) were orders continued under the ROA that may have entitled certain employees to unpaid infectious disease emergency leave under this provision when they were in effect. (At the time of writing, these orders are no longer in effect.)
As the ROA orders – including who they applied to - may have been amended from time to time, s. 3.1 provides that an employee was eligible for unpaid infectious disease emergency leave pursuant to s. 3.1 only if the order applied to the employee at the relevant time.
The start date for the entitlement to unpaid infectious disease emergency leave for this prescribed reason is retroactive to July 24, 2020, as that is the date the ROA took effect, and the EMCPA orders ceased to be orders under the EMCPA and were continued under the ROA.
Prior to July 24, 2020 - when the first emergency declaration was in place and the orders were EMCPA orders – it was Program policy that employees who were not performing the duties of their position because of a s. 7.0.2 EMCPA order that applied to them met the eligibility criteria for both declared emergency leave and unpaid infectious disease emergency leave. With respect to declared emergency leave, the Act explicitly references s. 7.0.2 EMCPA orders; with respect to unpaid infectious disease emergency leave it was Program policy that the entitlement arose based on subclause (iii) of s. 50.1(1.1)(b): these employees were considered to be subject to a control measure on the basis of a direction issued by the Government of Ontario. (It continues to be the Program’s position that orders under the EMCPA amount to a “direction” issued “by the Government of Ontario” for employees to whom the order applied.)
It was similarly Program policy that employees who were not performing the duties of their position because of an EMCPA order that applied to the employee and that was continued under the ROA were eligible for unpaid infectious disease emergency leave based on subclause (iii) of s. 50.1(1.1)(b): these employees were considered to be subject to a control measure on the basis of a direction issued by the Government of Ontario. From the Program’s perspective, this amendment provides greater certainty that employees in this situation are entitled to unpaid infectious disease emergency leave. As such, it is the Program’s view that employees’ entitlements did not change as a result of the amendment. (Similarly, even though there is no provision corresponding to s. 3.1 of O. Reg. 228/20 that applies with respect to paid infectious disease emergency leave, it is the Program’s position that employees meet the eligibility criterion for paid infectious disease emergency leave in ss. 50.1(1.2), para. 3 – which is worded the same as the criterion for unpaid infectious disease emergency leave set out in subclause (iii) of s. 50.1(1.1)(b) - where the employee is not performing the duties of his or her position because the employee is subject to an order that relates to COVID-19 under the ROA.)
Pursuant to ss. 1(2) of O. Reg. 228/20, s. 4 does not apply to employees who are represented by a trade union.
Clause 50.1(1.1)(b) of the ESA sets out the reasons for which an employee may take unpaid infectious disease emergency leave. Subclause (vii) of that provision provides that additional reasons may be prescribed by regulation.
Subsection 4(1) prescribes an additional reason that qualifies an employee for unpaid infectious disease emergency leave, ss. 4(1.1) provides the start date for the entitlement and specifies the period during which the entitlement applies, and ss. 4(2) deemsan employee who fits within that reason to be on the leave in respect of any time during the COVID-19 period (March 1, 2020 to July 30, 2022) the employee is not performing the duties of the employee’s position for that reason. Given that the COVID-19 period ended on July 30, 2022, COVID-19 is no longer designated as an infectious disease with respect to the reason prescribed in ss. 4(1).
These subsections must be read together with ss. 50.1(1.1), which reads in part:
Together, s. 4 of O. Reg. 228/20 and ss. 50.1(1.1) of the ESA establish that where, from March 1, 2020 to July 30, 2022 (COVID-19 period as defined in s. 1 of O. Reg. 228/20), an employee who was not/is not be performing the duties of his or her position because the employee’s hours of work are temporarily reduced or temporarily eliminated by the employer for reasons related to COVID-19, is deemed to be on unpaid infectious disease emergency leave in respect of any time the employee is not performing his or her duties because of that reason.
For example, for reasons related to COVID-19, an employer temporarily changes an employee’s schedule of 9 am – 5 pm every weekday to 9 am–1 pm every weekday from April 1, 2020 to August 30, 2020. As per ss. 4(2), this employee is deemed to be on unpaid infectious disease emergency leave every weekday from 1 pm to 5 pm from April 1, 2020 to August 30, 2020. As per ss. 4(3), all requirements and prohibitions that apply to Part XIV leaves (with the exceptions set out in ss. 4(4)-(6)) apply to employees who are deemed to be on a leave under this provision. (See the discussion of ss. 4(4)-(6) below for details.)
It is Program policy that the condition that the temporary reduction or temporary elimination of the employee’s hours by the employer “for reasons related to the designated infectious disease” will be met so long as at least one of the reasons for the temporary reduction or elimination was related to the designated infectious disease.
For a discussion of the term “temporarily” in relation to a reduction or elimination, see the discussion under s. 6. For a discussion of the terms “reduced or eliminated”, see the discussion under s. 9.
Note that it may be argued that there is some overlap between s. 4 of O. Reg. 228/20, which prescribes an additional reason for which employees are entitled to infectious disease emergency leave and also deems employees who meet this criteria to be on unpaid infectious disease emergency leave and both clause (iv) of s. 50.1(1.1)(b) and para. 3 of s. 50.1(1.2), which provide that an employee is entitled to take unpaid infectious disease emergency leave or paid infectious disease emergency leave, respectively, where the employee is under a direction given by his or her employer to, for example, not attend work, in response to the employer’s concern that the employee may expose other individuals in the workplace to COVID-19. Although it may be argued that s. 4(1) of O. Reg. 228/20 should apply to the situation where the employer temporarily reduced or eliminated an employee’s hours of work out of a concern that the employee may expose others in the workplace to COVID-19, it is Program policy that where employees are not performing the duties of their position because they are under a direction given by their employer in response to a concern of the employer that they may expose other individuals in the workplace to the designated infectious disease, the employee is eligible for infectious disease emergency leave under clause (iv) of s. 50.1(1.1)(b) and/or para. 3 of s. 50.1(1.2), rather than under s. 4(1) of O. Reg. 228/01.
An employee is deemed to be on unpaid leave only during the hours of work that the employee would have otherwise been working had the employer not temporarily reduced or temporarily eliminated the hours for reasons related to COVID-19. In other words, the deemed leave provisions do not give employees a right to a leave and to refuse hours/not attend work during hours the employer schedules them to work (and assert that they instead are deemed to be on leave for that time), solely because the employer has temporarily reduced the employee’s hours. For example, take a situation where an employer, for reasons related to COVID-19, temporarily reduces an employee’s hours from March 15, 2020 to June 20, 2020 from eight hours a day Monday to Friday down to eight hours on Mondays only. The employee is deemed to be on unpaid infectious disease emergency leave from Tuesday through Friday during this period. Does this employee have a right to be on infectious disease emergency leave on Mondays pursuant to s. 4(1), paragraph 1?
The answer is no. As per s. 50.1(1.1) of the ESA, an employee is entitled to infectious disease emergency leave if the employee will not be performing the duties of his or her position because of one of the listed reasons. Where the employee is scheduled to work, the listed reason in s. 4 of Reg 228/20 does not apply. An employee who used to be scheduled to work every weekday and who is now only scheduled to work Mondays is not considered to not be performing the duties of his or her position on Mondays just because the employer reduced her hours the rest of the week. Employees have the right to be on infectious disease emergency leave only for as long as the event or condition that triggered the entitlement lasts. After the triggering event is over or the condition is no longer present, the employee’s normal obligations to attend at work are resumed (assuming the employee does not have an entitlement to infectious disease emergency leave pursuant to a different eligibility criterion – or to another leave – on the Monday). This result is also made clear in the words of ss. 4(2), which provide that the employee is deemed to be on the leave “in respect of any time … that the employee does not perform such duties because of that reason”.
Employers are not prohibited under the ESA from scheduling employees to be on vacation at times when the employee’s hours could – absent the vacation - have been temporarily reduced or eliminated for reasons related to COVID-19 and the employee - had he or she not been scheduled for vacation - could have been deemed to be on unpaid infectious disease emergency leave. Note that this is different in the context of a leave that is not triggered by a deeming provision. In the context of those leaves, the employer does not have the right to treat an employee’s leave absences as vacation (although it is open to the employee to agree to take the days as vacation days - subject to the ESA’s requirements applicable to some leaves that they be taken in single period or periods of at least one week). In the deemed leave context, it is the employer whose actions trigger the conditions that result in the employee being deemed to be on the leave. If the employer schedules an employee for vacation, the conditions necessary for the deemed leave will not be met and the employee who is scheduled to be on vacation will not trigger the deemed leave provision.
Section 4 must be read subject to s. 5 of O. Reg. 228/20, which provides that certain employees are not considered to be on unpaid infectious disease emergency leave. See the discussion of s. 5 later in this chapter.
Subsection 4(3) provides that with the exceptions set out in ss. 4(4) (re: the requirement to give notice to the employer of the leave), and ss. 4(5) and 4(6) (re: benefit plan participation / contributions during the leave) all of the requirements and prohibitions that apply to Part XIV leaves apply equally to deemed leaves under ss. 4(2) (e.g. the anti-reprisal protection, reinstatement obligation, and provisions re: continued accrual of seniority, length of employment and length of service credits).
Issues may arise as to how the reinstatement obligation under s. 53 of the ESA applies where there have been layoffs and/or wage reductions in the workplace during a statutory leave. This issue is discussed below and addressed in the discussion of s. 53 of the Manual.
Subsection 4(4) exempts employees who are deemed to be on unpaid infectious disease emergency leave pursuant to ss. 4(2) of O. Reg. 288/20 from ss. 50.1(2) and (3) of the ESA.
Subsection 50.1(2) of the ESA requires an employee who takes unpaid infectious disease emergency leave to advise his or her employer that he or she will be doing so. Subsection 50.1(3) provides that if the employee begins the leave before advising the employer, the employee shall advise the employer of the leave as soon as possible after beginning it.
Since an employee who is deemed to be on leave is on the leave because of the employer’s action there is nothing to be achieved in requiring the employee to give notice of the leave to the employer. As such, ss. 4(4) exempts an employee who is deemed to be on a leave pursuant to ss. 4(2) from these notice requirements.
Section 51 of the ESA provides that employees who are on a statutory leave continue to participate in certain benefit plans unless the employee elects in writing not to do so, and it requires employers to continue to make the employer’s contributions for any of those benefit plans unless the employee advises the employer in writing that the employee is not going to pay his or her contributions. (See the discussion of s. 51 of the ESA for more information.)
Subsections 4(5) and (6) of O. Reg. 228/20 provide exemptions to those requirements in certain situations.
Subsection 4(5) provides that if an employee had stopped participating in a benefit plan described in subsection 51(2) of the ESA as of May 29, 2020 (the date O. Reg. 228/20 was filed), the employee does not have a statutory right to continue to participate in that particular benefit plan while on the deemed leave during the COVID-19 period.
Similarly ss. 4(6) exempts employers from the requirement in ss. 51(2) of the ESA to continue making the employer contributions to a particular benefit plan described in ss. 51(2) of the ESA while their employee is on a deemed leave during the COVID-19 period if the employer had already discontinued its contributions to that particular benefit plan before May 29, 2020 (the date O. Reg. 228/20 was filed).
The exemptions in ss. 4(5) or (6) apply only with respect to benefit plans that are described in ss. 51(2) of the ESA: pension plans, life insurance plans, accidental death plans, extended health plans, dental plans, and any prescribed type of benefit plan (of which there are none at the time of writing). The exemptions do not apply with respect to plans that are not described in ss. 51(2) but that employees are nonetheless entitled to participate in by virtue of O. Reg. 286/01, s. 10. Section 10 of O. Reg. 286/01 provides that if employees on a leave other than a leave under Part XIV (e.g. educational leave) are entitled to participate in a benefit plan then employees on a Part XIV leave must also be entitled to participate in that plan. The most significant types of plans that are not described in ss. 51(2) are short-term and long-term disability plans. Section 51 and the exemptions in ss. 4(5) and (6) do not apply to such plans. As such, if the employer’s plan provides short-term or long-term disability benefits to employees on leaves other than Part XIV leaves employees must be entitled to participate in those plans when they are deemed to be on unpaid infectious disease emergency leave.
The exemptions in ss. 4(5) and (6) only apply to employees who are deemed to be on unpaid infectious disease emergency leave. If an employee is on infectious disease emergency leave (paid or unpaid) pursuant to a different eligibility criterion – or on another statutory leave – the exemptions do not apply and s. 51 applies in its usual course.
Subsection 4(7) states that nothing in section 4 (the “prescribed leave/deemed leave” provision) or ss. 5(2) (which provides that certain employees who were given notice of termination are not considered to be on unpaidinfectious disease emergency leave for the prescribed reason in s. 4 unless the employer and employee agree to withdraw the notice of termination) affects any payments or benefits the employee received from the employer during the period March 1, 2020 to May 29, 2020 (the date that O. Reg. 228/20 was filed).
This provision addresses questions that may arise because of the retroactive deeming of the leave (i.e. between March 1, 2020 and May 29, 2020, the date O. Reg. 228/20 was filed, when combined with s. 6, which provides that in certain circumstances employees are not considered to be laid off starting March 1, 2020 (see s. 6 below for details).
For example, an employer temporarily eliminated an employee’s hours of work as of March 1, 2020 for reasons related to COVID-19, and the employee’s weekly earnings fell to $0. Because O. Reg. 228/20 was not yet filed, at that time the employee was considered to be on weeks of layoff under the ESA. The employer expected the elimination of hours to last for a significant amount of time and so continued to make substantial payments to the employee in order to extend the period of a temporary layoff per ss. 56(2) from 13 weeks in any period of 20 consecutive weeks to 35 weeks in any period of 52 weeks. O. Reg. 228/20 – which came into force only on May 29, 2020, after the employer had already made these payments – retroactively provides that this employee is deemed to have been on unpaid infectious disease emergency leave and not to be considered to have been laid off under the ESA during that time (see s. 6). As such, the employer may have made certain payments or provided certain benefits to the employee prior to May 29, 2020 that it wouldn’t have otherwise done had the employee been deemed to have been on a leave, and not a layoff, at the time.
Subsection 4(7) provides that the retroactive deeming of that period of layoff as unpaid infectious disease emergency leave does not affect any payments that were made by the employer March 1, 2020 to May 29, 2020. In other words, nothing about the retroactive application of s. 4 requires employees to pay these amounts back. Note, however, that the ESA does not prohibit an employer from recovering the amounts of those payments through wage deductions under s. 13 if the employee provides written authorization to do so in writing in accordance with s. 13(3) of the ESA.
The deemed leave established by subsection 2(2), 4 and 5 applied only during the defined COVID-19 period. This results from O. Reg. 228/20 by way of two provisions: 1) subsection 2(2) designates coronavirus (COVID-19) as an infectious disease for the purposes of the deemed leave only during the COVID-19 period, and 2) subsection 4(2) provides that an employee is deemed to be on unpaid infectious disease emergency leave any time during the COVID-19 period when the employee does not perform the duties of his her position because of the prescribed reason.
The COVID-19 period was March 1, 2020 to July 30, 2022. As of July 31, 2022 employees are no longer deemed to be on unpaid infectious disease emergency leave, even if their hours of work are temporarily reduced or temporarily eliminated by the employer for reasons related to COVID-19.
Issues may arise as to how the reinstatement obligation under s. 53 of the ESA applies at the end of the COVID-19 period where employers continue to experience economic challenges or to operate at a reduced capacity as compared to the employer’s operation prior to the COVID-19 period. Note that the ESA section 53(1) right to reinstatement is not absolute. The reinstatement provisions are meant to ensure that an employee who goes on a Part XIV leave (or, in this case, who is deemed to be on a Part XIV leave), is in the same position she or he would have been in if she or he had not gone on leave. The section 53 provisions are not meant to give a greater right to employees on leave.
Where an employer has reasons to terminate an employee's employment that are completely unrelated to the fact that the employee went on – or was deemed to be on – a Part XIV leave, reinstatement will not be required. This might be the case where, for example, the employer terminates the employment of an employee solely because a portion of its operations have ceased due to effects of the pandemic. The employer has the onus of proving that the termination was totally unrelated to the fact that the employee took the leave (Note that in the context of this deemed leave, it is not the employee who elected to take a leave, but rather it is the employer’s actions that resulted in the employee being deemed to be on the leave.)
The same principle applies with respect to economic downturns or other reasons that lead to layoffs. If at the end of the deemed leave, the position the employee most recently held still exists but is inactive (for example, because the business is not operating or is operating at lower than usual capacity and does not currently have any work for that position), there is no violation of s. 53 where the employer reinstates the employee into his or her most recently held position and immediately places the employee on a temporary layoff (so long as the layoff does not constitute a reprisal, e.g. if any part of the reason for the layoff was because the employee was on the leave). For practical purposes, in the situation where the position is inactive at the time the employee’s leave is over, the employer only notionally reinstates the employee; the employee does not need to physically return to the workplace for a shift nor does the employee need to complete any amount of work before being told that he or she is laid off.
Similarly, while an employer is required to pay a reinstated employee the wage rate the employee most recently earned (or the rate the employee would have earned had the employee worked through the leave), the ESA does not prohibit employers from reducing the employee’s wage rate immediately upon reinstating the employee, either permanently or temporarily (so long as the reduction does not constitute a reprisal, i.e. if any part of the reason for the reduction was because the employee was on the leave). However, a unilateral reduction of an employee’s wages, may, depending on the circumstances, constitute a constructive dismissal and if the employee resigns in response to the reduction within a reasonable period of time, a termination (and severance, if applicable) may result.
Note that unpaid and paid infectious disease emergency leave under s. 50.1(1.1) continue to be available to employees who meet the qualifying criteria. Paid infectious disease emergency leave is available until March 31, 2023.
O. Reg. 228/20 does not prevent employers from terminating or severing their employees’ employment by dismissing them or refusing/being unable to continue employing them during the COVID-19 period and nothing about the regulation’s retroactive application resurrects employment relationships that were already terminated or severed before the regulation was filed. Employees in these situations are not deemed to be on infectious disease emergency leave.
Subsection 5(1) simply reinforces that outcome by providing that for greater certainty:
This provision clarifies that a pre-May 29, 2020 termination that resulted from a constructive dismissal and subsequent resignation that was based on the employer unilaterally temporarily reducing or eliminating an employee’s hours of work or wages for reasons related to COVID-19 during the defined COVID-19 period isn’t “undone” by retroactively deeming that reduction or elimination to be a leave.
Note that this provision applies if the termination or severance resulting from a constructive dismissal happened before May 29, 2020, not the constructive dismissal itself. (To be a termination or severance resulting from a constructive dismissal under the ESA, there must be a constructive dismissal and the employee must resign in response to the constructive dismissal within a reasonable period of time. In other words, this provision applies only if the employee who was constructively dismissed resigned in response to that constructive dismissal prior to May 29, 2020.)
Subsection 5(2) states that an employee whose employer gave him or her written notice of termination in accordance with s. 57 or s. 58 of the ESA is not deemed to be on unpaid infectious disease emergency leave, even if the relevant criteria are met, unless the employer and employee agree in writing to withdraw the notice of termination before the termination crystallized. (An employer may wish to withdraw notices of termination where, for example, it provided them in anticipation of a layoff exceeding the length of a temporary layoff under the ESA before O. Reg. 228/20 was filed and the rules of temporary layoff were altered.)
Notice of termination, once given, generally cannot be withdrawn unless the employee consents to the withdrawal – see she discussion of this issue in s. 56 of the Manual for details.
If the notice of termination is withdrawn, the rules with respect to the application of the deemed leave provision apply as per usual from the date of the withdrawal forward.
(Note: if the criteria for being on a deemed leave were met before the employee received written notice of termination – i.e. there was a COVID-19 related reduction or elimination before notice of termination was given and the reduction or elimination was intended at the time only to be temporary - the employee would be deemed to be on unpaid infectious disease emergency leave with respect to that time.)
As per ss. 4(7) of O. Reg. 228/20, ss. 5(2) does not affect any payments that were made by the employer from March 1, 2020 to May 29, 2020. For example, as required by s. 60 of the ESA, an employer who provided notice of termination paid its employees their regular wages during the notice period even though the employees were not working. Subsection 4(7) provides that ss. 5(2) does not affect those payments and does not require the employee to pay those amounts back to the employer even if the employer and employee agree to withdraw the notice of termination.
For a discussion about reinstatement issues at the end of the COVID-19 period for employees who were on a deemed leave, please see the discussion under the heading “End of the COVID-19 Period” in section 4 above.
Pursuant to subsection 1(2) of this regulation, section 6 does not apply to an employee who is represented by a trade union.
Subsection 6(1) states that where an employee’s wages are temporarily reduced and/or hours of work are temporarily reduced or temporarily eliminated by the employer during the defined “COVID-19 period” (March 1, 2020 to July 30, 2022) for reasons related to COVID-19, the employee is not considered to be laid off for the purposes of sections 56 and 63 of the ESA (other than clause 63(1)(d)) and the employee is exempt from the application of sections 56 and 63 for the purposes of determining whether the employee has been laid off.
The effect of this provision is to “freeze” the temporary layoff clock from ticking as of March 1, 2020 and for the duration of the COVID-19 period (which ended on July 30, 2022) where the prescribed conditions are met. In other words, the provision stops specified weeks from being counted as a week of layoff. Only the numerator in the 13/20 or 35/52 thresholds is affected. The provision does not freeze or otherwise affect the denominator in the “count”, i.e. the 20- or 52-week rolling periods. As such, for an employee to whom this provision applies, a termination of employment cannot be triggered during the defined COVID-19 period by virtue of s. 56(1)(c), nor can a severance of employment be triggered by virtue of s. 63(1)(c) by way of a layoff exceeding the length of a temporary layoff.
Note that subsection (2) clarifies that where an employee was terminated pursuant to clause 56(1)(c) or severed under clause 63(1)(c) prior to May 29, 2020 (the date O. Reg. 228/20 was filed), this provision does not apply to that employee.
The following discussion will look at each of the five conditions that must be present for this provision to apply:
This provision specifies that it applies to reductions or eliminations in the following situations: it applies where “hours of work are temporarily reduced or eliminated” and where “wages are temporarily reduced”. The Program views this condition as being met if the employee experiences a reduction or an elimination in either hours of work or wages. In other words, though not explicitly stated, the provision is interpreted to include the elimination of wages. As such, an employee will meet this condition if the employee is subject to any of the following: a reduction in hours of work, a reduction in wages, or an elimination in hours of work and an elimination in wages. All other ESA rules, such as the obligation to comply with the minimum wage requirements where work is performed, continue to apply as usual.
Section 9 of the regulation establishes specific rules to be used in determining whether hours and/or wages have been reduced for the purposes of the regulation. Subsection 9(1), read in conjunction with ss. 9(3) and (4), establishes what is a reduction in hours of work for the purpose of this provision. Subsection 9(2), read in conjunction with ss. 9(3) and (4), establishes what is a reduction in wages for the purpose of this provision. Please see the discussion of section 9 for more information.
This condition is met only where the employee is subject to a temporary reduction or a temporary elimination in hours of work or wages. The condition is not met if the reduction or elimination is a permanent change.
Determining whether a reduction or elimination of hours of work or wages is temporary or permanent is a question of fact that can only be answered on a case-by-case basis taking all relevant facts into consideration. Note, however, that key elements in this assessment are the employer’s intention and the parties’ understanding at the time the change was made. Did the employer intend for the change to be temporary or did the employer instead intend to initiate a permanent change to the terms and conditions of the employee’s employment? What was the employee’s understanding of the change? If the change was intended to be a permanent change, this condition would not be met and section 6 would therefore not apply to the employee.
Given the climate of economic uncertainty brought about by COVID-19, it is possible that an employer may, at the time the change is made, be unsure whether the reduction or elimination of an employee’s hours of work and/or wages will be temporary or permanent. It may be that the employer is taking a “wait and see” approach to its ability to maintain employment relationships and to return terms and conditions of employment to their pre-COVID-19 period state. These outcomes may depend on factors such as when the business is permitted to reopen, demand for the employer’s products during the pandemic, production capacity while maintaining physical distancing for employees etc. The Program takes the view that, in this type of situation, the employer is generally considered to have intended the change to be temporary, unless there is evidence to the contrary.
The temporary reduction or elimination of the employee’s hours of work and/or wages must be initiated by the employer for section 6 to apply. In other words, if the employee works fewer hours for a reason that is initiated or brought about by the employee – for example, if the employee was away from work because the employee elected to take a statutory leave of absence such as sick leave or family responsibility leave, or requested personal time away from work – this provision does not apply.
Note that in a situation where the employer gives the employee an ultimatum between accepting a reduction in hours and/or wages or termination, if the employee “chooses” the reduction in hours and/or wages, the Program considers this change to have been initiated by the employer and not the employee.
This condition is met where the employer’s decision to temporarily reduce or temporarily eliminate an employee’s hours of work and/or wages is made in whole or in part for reasons related to the designated infectious disease. The designated infectious disease referenced here is COVID-19, pursuant to section 2.
In some cases, there will be more than one reason an employer temporarily reduces or temporarily eliminates an employee’s hours or wages. As long as one of the reasons is related to the COVID-19, this condition is met. The reason for the reduction or elimination can be directly related to COVID-19 or it can be indirect. Examples of reasons related to COVID-19 include: an employer’s business was ordered to suspend operations by order under the Reopening Ontario (A Flexible Response to COVID-19) Act, 2020 or by an emergency order under the Emergency Management and Civil Protection Act; a brewer reduced its employees’ hours because the demand for beer was reduced since restaurants and pubs had been ordered pursuant to an order to close temporarily; a private children’s bus line eliminated some of its employees’ hours because schools were closed; a party supply business reduced its employees’ wages due to reduced revenue resulting from a lack of demand for party supplies when physical distancing rules were in effect; an employee’s hours were temporarily eliminated because the employer was concerned that the employee might expose others in the workplace to COVID-19.
Subsection 1(1) of this regulation defines the “COVID-19 period”. The COVID-19 period is March 1, 2020 to July 30, 2022.
Only where the four conditions discussed above occur during the defined COVID-19 period does section 6 to apply. For example, it could be that an employee’s hours of work were temporarily reduced by the employer for reasons related to COVID-19 beginning on February 23, 2020 and ending on June 1, 2020. In that case, section 6 applies only to the reduction in hours that occurred from March 1, 2020 to June 1, 2020; the reduction in hours that occurred prior to March 1, 2020 (i.e. from February 23, 2020 to February 29, 2020) is unaffected by O. Reg. 228/20.
Where all five of these conditions are met, the employee is exempt from the application of sections 56 and 63 of the Act for the purposes of determining whether the employee has been laid off. The employee is not considered to be laid off under section 56 or section 63, with the exception of clause 63(1)(d). (Clause 63(1)(d) provides that an employee’s employment is severed where the employer lays off an employee due to a permanent discontinuance of all of the employer’s business at an establishment.)
The effect of this provision is to “freeze” the temporary layoff clock from ticking from March 1, 2020 to July 30 2022 where the prescribed conditions are met. In other words, the provision stops specified weeks from being counted as a week of layoff. Only the numerator in the 13/20 or 35/52 thresholds is affected. The provision does not freeze or otherwise affect the denominator in the “count”, i.e. the 20- or 52-week rolling periods. As such, for an employee to whom this provision applies, a termination of employment cannot be triggered during the defined COVID-19 period by virtue of s. 56(1)(c), nor can a severance of employment be triggered by virtue of s. 63(1)(c) by way of a layoff exceeding the length of a temporary layoff.
Note, however, that there may be situations where a reduction or elimination in hours and/or wages starts out as a reduction to which section 6 applies – and therefore to which a layoff under sections 56 and 63 do not apply - but the circumstances change partway through such that the five conditions in section 6 are no longer met. At the point in time where any one of the conditions is no longer met, section 6 stops applying and the rules set out in section 56 and 63 resume their application.
For example, say the employee’s hours of work were temporarily eliminated due to the closure of a business resulting from an order issued under the Reopening Ontario (A Flexible Response to COVID-19) Act, 2020 or under the Emergency Management and Civil Protection Act. The elimination of hours originally falls within purview of section 6. If, for example, at a particular point in time, the business is no longer viable and, as such, it becomes clear to the employer that there is no longer a possibility of the employee’s hours of work being reinstated, the reduction in hours is no longer “temporary” and so this provision no longer applies. As of that point in time, the exemption no longer applies and sections 56 and 63 resume application.
Subsection 6(2) clarifies that where an employee was terminated under clause 56(1)(c) or severed under clause 63(1)(c) prior to May 29, 2020 (the date O. Reg. 228/20 was filed), this provision does not apply to that employee. In other words, where an employee was on a temporary layoff that lasted longer than the period of temporary layoff, and which consequently resulted in the termination or severance of the employee’s employment before May 29, 2020, the employee is not affected by this provision. The employment relationship is not resurrected by the regulation.
Subsection 6(1) provides that where an employee’s wages and/or hours of work are temporarily reduced or temporarily eliminated by the employer during the defined “COVID-19 period” (March 1, 2020 to July 30, 2022) for reasons related to COVID-19, the non-unionized employee is not considered to be laid off for the purposes of sections 56 and 63 of the ESA (other than clause 63(1)(d)) and the employee is exempt from the application of sections 56 and 63 for the purpose of determining whether the employee has been laid off. This temporary rule applied only during the defined COVID-19 period. The COVID-19 period was March 1, 2020 to July 30, 2022. As of July 31, 2022, this temporary rule no longer applied to employees. In other words, where an employee’s temporary layoff clock had been “frozen” during the COVID-19 period due to this provision, the clock was “unfrozen” as of July 31, 2022. Any time the employee spends on a temporary layoff on or after July 31, 2022 once again counts toward a possible termination and/or severance of employment, even if the temporary layoff was for reasons related to COVID-19. For more information on temporary layoff, please see ESA Part XV, s. 56.
Where an employee was subject to a temporary reduction in hours of work and/or wages by the employer during the COVID-19 period for reasons related to COVID-19 and that reduction/elimination was continued after the COVID-19 period, questions may arise as to how to determine whether the employee is on a layoff after July 30, 2022.
The answer is that the ESA’s “regular rules” will apply.
It is important to note that the return to “regular rules” in sections 56 and 63 of the ESA applies only on a go-forward basis. At the end of the COVID-19 period, it is not the case that weeks that would have been weeks of layoff but for the application of section 6 can be “recharacterized” as weeks of layoff. The end of the COVID-19 period does not affect the previous operation of the temporary rule for that period. As well, per section 8 of the regulation, any portion of a claim relating to termination and/or severance of employment based on the employer temporarily reducing or temporarily eliminating an employee’s wages and/or hours of work during the COVID-19 period continues to be deemed not to have been filed. (However, a claim may be filed in respect of reductions or eliminations in effect after July 30, 2022, even if the reduction/elimination was made for reasons related to COVID-19.) See the discussion at section 8 below for more information.
Pursuant to subsection 1(2) of this regulation, section 7 does not apply to an employee who is represented by a trade union.
This provision establishes that where, during the defined “COVID-19 period” (March 1, 2020 to July 30, 2022) an employee’s hours of work or wages are temporarily reduced or eliminated by the employer for reasons related in whole or in part to COVID-19, the change does not constitute constructive dismissal for the purposes of the ESA. As such, since an employee who is in this situation is not constructively dismissed for the purposes of the ESA, a termination of employment will not be triggered in these circumstances by virtue of s. 56(1)(b), nor will a severance of employment be triggered by virtue of s. 63(1)(b).
Note that subsection (2) clarifies that where an employee was terminated under clause 56(1)(b) or severed under clause 63(1)(b) prior to May 29, 2020, this provision does not apply to that employee.
The following discussion will look at each of the five conditions that must be present for this provision to apply:
This provision states that it applies to reductions or eliminations in the following situations: it applies where “hours of work are temporarily reduced or eliminated” and where “wages are temporarily reduced”. The Program views this condition as being met if the employee experiences a reduction or an elimination in either hours of work or wages. In other words, though not explicitly stated, the provision is interpreted to include the elimination of wages where there has been an elimination of hours. As such, an employee will meet this condition if the employee is subject to any of the following: a reduction in hours of work, a reduction in wages, an elimination in hours of work or a corresponding elimination in wages.
Section 9 of the regulation establishes specific rules to be used in determining whether hours and/or wages have been reduced for the purposes of the regulation. Subsection 9(1), read in conjunction with ss. 9(3) and (4), establish what is a reduction in hours of work for the purpose of this provision. Subsection 9(2), read in conjunction with ss. 9(3) and (4), establish what is a reduction in wages for the purpose of this provision. Please see the discussion of section 9 for more information.
This condition is met only where the employee is subject to a temporary reduction or a temporary elimination in hours of work or wages. The condition is not met if the reduction or elimination is a permanent change.
Determining whether a reduction or elimination of hours of work or wages is temporary or permanent is a question of fact that can only be answered on a case-by-case basis taking all relevant facts into consideration. Note, however, that key elements in this assessment are the employer’s intention and the parties’ understanding at the time the change was made. Did the employer intend for the change to be temporary or did the employer instead intend to initiate a permanent change to the terms and conditions of the employee’s employment? What was the employee’s understanding of the change? If the change was intended to be a permanent change, this condition would not be met and subsection 7(1) would therefore not apply to the employee.
Given the climate of economic uncertainty brought about by COVID-19, it is possible that an employer may, at the time the change is made, be unsure whether the reduction or elimination of an employee’s hours of work and/or wages will be temporary or permanent. It may be that the employer is taking a “wait and see” approach to its ability to maintain employment relationships and to return terms and conditions of employment to their pre-COVID-19 period state. These outcomes may depend on factors such as when the business is permitted to reopen, demand for the employer’s products during the pandemic, production capacity while maintaining physical distancing for employees etc. The Program takes the view that, in this type of situation, the employer is generally considered to have intended the change to be temporary, unless there is evidence to the contrary.
The temporary reduction or elimination of the employee’s hours of work and/or wages must be initiated by the employer for subsection 7(1) to apply. In other words, if the employee works fewer hours for a reason that is initiated or brought about by the employee – for example, if the employee was away from work because the employee elected to take a statutory leave of absence such as sick leave or family responsibility leave or requested personal time away from work – this provision does not apply.
Note that in a situation where the employer gives the employee an ultimatum between accepting a reduction in hours and/or wages or termination, if the employee “chooses” the reduction in hours and/or wages, the Program considers this change to have been initiated by the employer and not the employee.
This condition is met where the employer’s decision to temporarily reduce or temporarily eliminate an employee’s hours of work/wages is made in whole or in part for reasons related to the designated infectious disease. The designated infectious disease referenced here is COVID-19, pursuant to section 2.
In some cases, there will be more than one reason an employer temporarily reduces or temporarily eliminates an employee’s hours or wages. As long as one of the reasons is related to the COVID-19, this condition is met. The reason for the reduction or elimination can be directly related to COVID-19 or it can be indirect. Examples of reasons related to COVID-19 include: an employer’s business was ordered to suspend operations by order under the Reopening Ontario (A Flexible Response to COVID-19) Act, 2020 or by an emergency order under the Emergency Management and Civil Protection Act; a brewer reduced its employees’ hours because the demand for beer was reduced since restaurants and pubs had been ordered pursuant to an emergency order to close temporarily; a private children’s bus line eliminated some of its employees’ hours because schools were closed; a party supply business reduced its employees’ wages due to reduced revenue resulting from a lack of demand for party supplies when physical distancing rules were in effect an employee’s hours were temporarily eliminated because the employer was concerned that the employee might expose others in the workplace to COVID-19.
Subsection 1(1) of this regulation defines the “COVID-19 period”. The “COVID-19 period” is March 1, 2020 to July 30, 2022.
Subsection 7(1) applies only where all four of the conditions discussed above occur during the defined COVID-19 period.
(Note, however, this condition must be read subject to subsection 2 that provides that where a temporary reduction or elimination in hours of work or wages occurred prior to May 29, 2020 – even ones brought about by the employer for reasons related to COVID-19 that occurred during the COVID-19 period – if the change resulted in a constructive dismissal and the employee resigned from his or her employment in response to the change within a reasonable period of time and the resignation occurred prior to May 29, 2020, a claim relating to this constructive dismissal can be filed with the Ministry of Labour, Immigration, Training and Skills Development investigated, and may result in a finding that the employee was terminated pursuant to ss. 56(1)(b). See the discussion of ss. 7(2) and s. 8 for more details.)
Where the conditions are met, the temporary reduction or elimination of the employee’s hours of work or wages by the employer for reasons related to COVID-19 during the COVID-19 period does not constitute constructive dismissal for the purposes of the ESA.
Since an employee who is in this situation is not constructively dismissed for the purposes of the ESA, a termination of employment will not be triggered in these circumstances by virtue of s. 56(1)(b), nor will a severance of employment be triggered by virtue of s. 63(1)(b). Without subsection 7, a unilateral reduction in hours of work or wages might otherwise amount to a constructive dismissal if the reduction was significant enough, and it would create termination and severance pay obligations if the employee resigned in response within a reasonable period of time.
Note that this provision addresses constructive dismissal only under the ESA. The provision does not address what constitutes a constructive dismissal at common law.
This provision took effect when O. Reg. 228/20 was filed on May 29, 2020.
Subsection 7(2) clarifies that where an employee was terminated under clause 56(1)(b) or severed under clause 63(1)(b) prior to May 29, 2020, this provision does not apply to that employee.
Note that in order to be terminated under clause 56(1)(b) or severed under clause 63(1)(b), the employee must have been constructively dismissed and must have resigned from his or her employment in response to the employer’s actions within a reasonable period. It is only where both the constructive dismissal and the employee’s resignation occurred prior to May 29, 2020 that the employee is not affected by subsection 7(1). If an employee was constructively dismissed by his or her employer and the employee resigned in response to the employer’s actions after May 29, 2020, subsection 7(1) applies.
Note that nothing in section 7 affects a constructive dismissal that arises for reasons other than the employer temporarily reducing or temporarily eliminating an employee’s hours of work or wages for reasons related to COVID-19 during the defined COVID-19 period. If, for example, an employee was constructively dismissed during the defined COVID-19 period as the result of changes to the employee’s wages or hours for reasons wholly unrelated to COVID-19, or if the change that results in a constructive dismissal is made for a COVID-related reason but relates to something other than hours of work or wages – such as a significant change in the employee’s work location or a significant reduction in the employee’s job responsibilities etc. – the employee may be found to be terminated and/or severed per the usual application of s. 56(1)(b) and/or s. 63(1)(b).
Section 7 establishes that where, during the defined “COVID-19 period” (March 1, 2020 to July 30, 2022) an employee’s hours of work or wages are temporarily reduced or temporarily eliminated by the employer for reasons related in whole or in part to COVID-19, the change does not constitute constructive dismissal under the ESA.
The rule in section 7 applied only during the defined COVID-19 period. This means that as of July 31, 2022 the ESA’s regular rules for constructive dismissal resumed application on a go-forward basis: a substantial unilateral reduction or elimination of a non-unionized employee’s hours of work or wages could once again constitute a constructive dismissal under the ESA, even if the reduction or elimination was done for reasons related to COVID-19. This applies only to reductions or eliminations of an employee’s hours of work or wages that were in effect on or after July 31, 2022. The employee would need to resign within a reasonable period in response to the constructive dismissal in order for the employee to be considered to be terminated and/or severed per subsections 56(1)(b) and/or 63(1)(b) of the ESA.
It is important to note that the “regular rules” for constructive dismissal apply only on a “go-forward basis”. At the end of the COVID-19 period, an employee cannot file a constructive dismissal claim on the basis of temporary reductions to hours of work and/or wages that occurred only during the COVID-19 period for reasons related to COVID-19. The end of the COVID-19 period does not affect the previous operation of the temporary rule for that period. As well, per section 8 of the regulation, these claims are deemed not to have been filed. However, where an employee’s hours of work and/or wages were temporarily and unilaterally reduced or eliminated by the employer during the COVID-19 period for reasons related to COVID-19 and that unilateral reduction/elimination continues after the end of the COVID-19 period, a constructive dismissal claim can be filed - but only with respect to the reductions in effect after July 30, 2022. An employee in this situation can resign within a reasonable period after July 31, 2022 and make a claim for constructive dismissal on the basis of the reduction/elimination in hours of work and/or wages in effect at that time.
The question may arise as to what is a “reasonable period” for an employee to resign and claim constructive dismissal after July 30, 2022 based on reductions/eliminations in place at that time, where the unilateral reductions/eliminations are a continuation of a temporary reduction/elimination of hours of work or wages for reasons related to COVID-19 in place during the COVID-19 period. It is Program policy that in this situation, days during the COVID-19 period (March 1, 2020 to July 30, 2022) are not taken into account when assessing what is a reasonable period of time for the resignation to occur. This is because the employee was barred from claiming constructive dismissal under the ESA during the COVID-19 period due to O. Reg. 228/20.
Subsection 8(1) provides that certain complaints regarding termination and/or severance filed with the Ministry of Labour, Immigration, Training and Skills Development are deemed not to have been filed. By deeming the complaint not to have been filed, employees who filed the complaint are not prohibited by s. 97 of the ESA from commencing a civil proceeding regarding their termination and/or severance entitlements. For example, an employee could choose to pursue wrongful dismissal litigation in the courts.
Pursuant to ss. 1(2) of O. Reg. 228/20, s. 8 does not apply to employees who are represented by a trade union.
In general terms, this provision applies to claims for termination pay and/or severance pay that are based on a constructive dismissal or on a layoff that exceeded the period of a temporary layoff if the foundation for the constructive dismissal or layoff was a temporary reduction or temporary elimination of wages or hours of work for reasons related to COVID-19 during the COVID-19 period (March 1, 2020 to July 30, 2022).
Specifically, complaints are deemed not to have been filed if the complaint is with respect to termination and/or severance and the foundation of the complaint meets all of these conditions:
Subsection 8(1) applies equally whether the employee specifically raised the disallowed allegations in the claim form, or whether the issue arose during the course of an investigation.
Subsection 8(1) applies regardless of the date the claim is filed. Subject to ss. 8(2), the provision applies, for example, to claims that were filed before O. Reg. 228/20 was made and those filed after the COVID-19 period is over. For information about claims filed with respect to a temporary reduction or temporary elimination of hours of work or wages that began during the COVID-19 period and continued after the end of the COVID-19 period, please see the heading “End of the COVID-19 Period – Complaint Filing” below.
The deeming provision applies only to the portion of the claim relating to the disallowed termination and/or severance allegation. If the claim contains allegations that are not disallowed per ss. 8(1), those other allegations are investigated in the usual course.
For example, if a claim was made for termination pay and it was based on a temporary reduction or temporary elimination of wages or hours of work by the employer that was for reasons related in whole or in part to COVID-19 from February 1, 2020 to April 30, 2020, the claim would proceed for investigation as per usual with respect to the reduction or elimination that occurred in February, i.e. prior to the March 1, 2020 beginning of the COVID-19 period.
Another example relates to reprisal allegations. Even if a reprisal allegation arises from a temporary reduction or temporary elimination in hours of work or wages that are related to COVID-19 during the COVID-19 period, that allegation will be investigated as per usual. Take a situation where a claimant alleges that an employer who had to eliminate the hours of 20% of its workforce because of COVID-19 during the COVID-19 period selected the claimant in part because he had taken a statutory leave or exercised another ESA right. The reprisal allegation would be investigated as per usual.
Employment Standards Officers address the question as to whether there are disallowed allegations at the outset of an investigation. A claim that is deemed not to have been filed does not trigger the application of s. 97 of the ESA.
Subsection 8(1) must be read in conjunction with ss. 8(2), which provides that ss. 8(1) doesn’t apply if the employee’s complaint relates to:
a termination under clause 56(1)(a) of the Act or a severance under clause 63(1)(a) of the Act, (i.e. where an employer dismisses the employee or otherwise refuses or is unable to continue employing the employee) or a severance under clause 63(1)(d) or (e), (i.e. where the severance of employment is because of a permanent discontinuance of all of the employer’s business at an establishment or because the employee gave written notice of resignation during the statutory notice period where certain conditions were met.)
Claims for termination or severance pay based on these kinds of terminations or severances are not disallowed pursuant to ss. 8(1) and are investigated as per usual.
Such claims are allowed even if the reason for the termination or severance was related to COVID-19 (e.g. the employer permanently closed its business because of COVID-19 and the employee claims the employer did not provide the required notice of termination or pay in lieu).
This provision, while not strictly necessary since terminations and severances under clause 56(1)(a) of the Act or a severance under clause 63(1)(a), (d) and (e) of the Act are permanent and therefore do not fall within the condition in ss. 8(1) that the changes be “temporary”, clarifies that claims filed with the Ministry for termination and/or severance pay based on this kind of termination and/or severance are not disallowed.
a termination under clause 56(1)(b) or (c) or a severance under section 63(1)(b) or (c) that occurred before May 29, 2020 (the date O. Reg. 228/20 was filed).
Clause (b) creates an exception to the “deemed not filed” rule in ss. 8(1).
It allows claims to be filed and investigated where the termination or severance resulting from a layoff or constructive dismissal crystallized before the law was changed by O. Reg. 228/20.
Specifically, it provides that claims for termination or severance pay that are based on a layoff exceeding the period of a temporary layoff or on a constructive dismissal are not disallowed pursuant to ss. 8(1) and therefore are investigated as per usual if they occurred before May 29, 2020 (the date O. Reg. 228/20 was filed).
Such claims are allowed even if the reason for the layoff or constructive dismissal was COVID-19 related and even if the termination or severance occurred during the defined COVID-19 period, provided it occurred before May 29, 2020.
With respect to terminations or severances resulting from a constructive dismissal, note that the termination and severance occur on the date that the employee resigns in response to the constructive dismissal, not on the date the constructive dismissal occurred.
Although ss. 8(1) states that certain claims are disallowed if they are based on a situation where an employee’s “hours of work are temporarily reduced or eliminated” or where “wages are temporarily reduced” the Program’s position is that this provision also applies to disallow a claim if the allegation is based on a temporary elimination of wages for reasons related to COVID-19 during the COVID-19 period.
Some might argue that the inclusion of the phrase “wages are temporarily reduced” without also including “wages are temporarily eliminated” means that a claim based on the temporary elimination of wages is not disallowed. The Program’s position is that the reference to an elimination in hours of work also captures the situation where there has been a corresponding elimination in employees’ wages resulting from the eliminated hours, and as such, claims based on the temporary elimination of wages are disallowed by the phrase “hours of work are temporarily … eliminated”. The phrase “wages are temporarily reduced” captures a scenario where an employee’s wages were temporarily reduced where there was no corresponding reduction in the employee’s hours, i.e. where an employee’s wage rate was reduced.
Section 8 deems certain termination and severance of employment claims to not have been filed with the Ministry of Labour, Immigration, Training and Skills Development. Subject to the exception in subsection 8(2), claims cannot be filed for termination pay or severance pay based either on a constructive dismissal or on a layoff that exceeded the period of a temporary layoff, if the foundation for the constructive dismissal or layoff was a temporary reduction or temporary elimination of wages or hours of work by the employer for reasons related to COVID-19 during the COVID-19 period. The COVID-19 period was in effect from March 1, 2020 to July 30, 2022.
The prohibition established in subsection 8(1) – which is subject to the exception set out in subsection 8(2) – remains in effect at the end of the COVID-19 period and applies regardless of the date the claim is filed. In other words, a termination and/or severance of employment claim cannot be investigated after the COVID-19 period is over if the claim is in respect of temporary changes that were in effect only during the COVID-19 period (March 1, 2020 to July 30, 2022). Where the change that resulted in the termination or severance allegation happened entirely during the COVID-19 period and meets the relevant criteria established by the regulation, that portion of the claim continues to be deemed not to have been filed.
However, if, as of July 31, 2022, an employee continues to be - or is newly – subject to a substantial unilateral reduction in hours of work or wages by the employer for reasons related to COVID-19 and the employee resigns in response to the change within a reasonable period and claims constructive dismissal, that alleged constructive dismissal claim can be filed with the ministry and will be investigated. Similarly, if an employee is temporarily laid off on or after July 31, 2022 – even if the temporary layoff is for reasons related to COVID-19 – and the employee alleges that the temporary layoff has resulted in a termination or severance of employment under the ESA, the employee can file a termination and/or severance pay claim with the ministry and it will be investigated.
Pursuant to subsection 1(2) of this regulation, section 9 does not apply to an employee who is represented by a trade union.
The provision sets out formulas to be used in establishing whether an employee’s hours of work and/or wages are considered to have been reduced for the purposes of the regulation. In general terms, the formulas are based on comparing the employee’s hours of work and/or wages during the COVID-19 period to the employee’s hours of work and/or wages during a period of time before the effects of COVID-19 were felt in most workplaces.
Subsection 9(1), read in conjunction with ss. 9(3) and (4), establish when an employee’s hours of work are considered to have been reduced for the purposes of the regulation.
Assessing whether an employee’s hours of work have been reduced is relevant in the application of the following provisions:
The provision establishes different formulas that apply depending on which of three categories the employee falls into: the employee has a regular work week, the employee does not have a regular work week, or, regardless of whether or not the employee has a regular work week, the employee was not employed by the employer during the entire work week that immediately preceded March 1, 2020. Each of these categories are discussed below:
If the employee has a regular work week, the employee’s hours of work are considered to be reduced if the employee works fewer hours in the work week than the employee worked in the last regular work week before March 1, 2020. (Note that if the employee was not employed by the employer during the entire work week that immediately preceded March 1, 2020, the employee falls into category 3.)
However, per ss. 9(3), if the employee was on vacation, not able to work, not available for work, subject to a disciplinary suspension or was not provided with work because of a strike or lock-out occurring at his or her place of employment or elsewhere for any part of the last work week before March 1, 2020, then the work week to be applied is, instead, the last regular work week before March 1, 2020 in which such conditions did not apply for any part of the work week.
This formula therefore involves comparing the number of hours the employee worked in the last regular work week before March 1, 2020 during which none of the scenarios set out in subsection 9(3) occurred, to the work week in question.
Work week is defined in s. 1 of the ESA as follows:
In order to determine what is the last regular work week before March 1, 2020, it is necessary to first establish the work week that includes March 1, 2020. From there, look back one full work week. This will be the last full work that occurred prior to March 1, 2020. If none of the scenarios set out in subsection (3) apply for any part of the work week, then then this is the work week used in the comparison. However, if, during that work week, any of the scenarios set out in subsection 9(3) applied for any period of time, then it is necessary to continue to look back work week by work week to find the first work week in which none of the scenarios set out in subsection 9(3) are present.
Once the comparator work week is established, the number of hours the employee worked in that work week is compared to the number of hours the employee worked in the work week in question (i.e. the work week during the COVID-19 period). If the employee worked more hours in the pre-March 1, 2020 “comparator week” as compared to the work week in question, then the employee is considered to have had a reduction in his or her hours of work for the purposes of sections 4, 6, 7 and 8.
For example, assume that in applying this formula, the employee has a comparator work week of 40 hours. If during the COVID-19 period, the employee works anything less than 40 hours in a given work week, then there will have been a reduction for the purposes of sections 4, 6, 7 and 8 of the regulation.
If the employee does not have a regular work week, the employee’s hours of work are considered to be reduced if the employee works fewer hours in the work week than the average number of hours the employee worked per work week in the period of 12 consecutive work weeks that preceded March 1, 2020. (Note: if the employee was not employed by the employer during the entire work week that immediately preceded March 1, 2020, the employee falls into category 3.)
However, per ss. 9(4), if the employee was not employed, was on vacation, was not able to work, was not available for work, was subject to a disciplinary suspension or was not provided with work because of a strike or lock-out occurring at his or her place of employment or elsewhere for any part of a work week in the 12-week period referred to in those paragraphs, then that work week is excluded for the purposes of the averaging.
This formula therefore involves comparing the average number of hours the employee worked in the 12 consecutive work weeks prior to March 1, 2020 (or lesser number of averaged weeks if there are any excluded weeks pursuant to ss. 9(4)) to the number of hours the employee worked in the work week in question during the COVID-19 period.
In order to establish the period of 12 consecutive work weeks that preceded March 1, 2020, it is necessary to first establish the work week that includes March 1, 2020. From there, look back 12 work weeks.
Next, determine if during any of those 12 work weeks, any of the scenarios set out in subsection (4) apply for any period of time. If any of the scenarios apply during a work week, that work week is excluded from the averaging calculation, meaning the average is calculated over a period shorter than 12 weeks. For example, if the only condition that applied during the 12-week timeframe was that the employee was on vacation for one week or a part of a week, the average of the remaining 11 weeks would be calculated.
Once the comparator average is established, the next step is to determine the number of hours the employee worked during the work week in question (i.e. the work week during the COVID-19 period). If the average number of hours of work determined pursuant to subsection 9(2) amounts to more hours than the employee worked in the work week in question, then the employee is considered to have a reduction in his or her hours of work for the purposes of sections 4, 6, 7 and 8.
If the employee was not employed by the employer during the entire work week that immediately preceded March 1, 2020, then the employee’s hours of work are considered to be reduced if the employee worked fewer hours in the work week in question than the employee worked in the work week in which he or she worked the greatest number of hours. This formula applies regardless of whether or not the employee has a regular work week.
Where an employee falls into this category, a comparison is made between the work week in which the employee worked the greatest number of hours - regardless of when that occurred during the employment relationship - and the number of hours the employee worked during the work week in question during the COVID-19 period.
If the employee worked more hours during any previous work week than he or she worked in the work week in question, then the employee is considered to have a reduction in his or her hours of work for the purposes of sections 4, 6, 7 and 8.
Subsection 9(2), read in conjunction with ss. 9(3) and (4), establish when an employee’s wages are considered to have been reduced for the purposes of this regulation.
Assessing whether an employee’s wages are considered to have been reduced is relevant in the application of the following provisions:
The provision establishes different formulas that apply depending on which of three categories the employee falls into: the employee has a regular work week, the employee does not have a regular work week, or, regardless of whether or not the employee has a regular work week, the employee was not employed by the employer during the entire work week that immediately preceded March 1, 2020. Each of these categories are discussed below:
If the employee has a regular work week, the employee’s wages are considered to be reduced if the employee earns less regular wages in the work week than he or she earned in the last regular work week before March 1, 2020. (Note, if the employee was not employed by the employer during the entire work week that immediately preceded March 1, 2020, the employee falls into category 3.)
However, per ss. 9(3), if the employee was on vacation, not able to work, not available for work, subject to a disciplinary suspension or was not provided with work because of a strike or lock-out occurring at his or her place of employment or elsewhere for any part of the last work week before March 1, 2020, then the work week to be applied is, instead, the last regular work week before March 1, 2020 in which such conditions did not apply for any part of the work week.
This formula therefore involves comparing the regular wages the employee earned during the last regular work week before March 1, 2020 in which none of the scenarios set out in subsection 9(3) occurred, to the regular wages the employee earned in the work week in question.
Work week is defined in s. 1 of the ESA as follows:
"Regular wages" is defined in ESA Part I, s. 1 as follows:
In order to determine what is the last regular work week before March 1, 2020, it is necessary to first establish the work week that includes March 1, 2020. From there, look back one full work week. This will be the last full work that occurred prior to March 1, 2020. If none of the scenarios set out in subsection (3) apply for any part of the work week, then then this is the work week used in the comparison. However, if during that work week, any of the scenarios set out in subsection 9(3) applied for any part of that work week, then it is necessary to continue to look back work week by work week to find the first work week in which none of the scenarios set out in subsection 9(3) are present.
Once the comparator work week is established, the regular wages the employee earned in that work week are compared to the regular wages the employee earned in the work week in question (i.e. the work week during the COVID-19 period). If the employee earned more regular wages in the pre-March 1, 2020 “comparator week” as compared to the work week in question, then the employee is considered to have had a reduction in his or her wages for the purposes of sections 6, 7 and 8.
If the employee does not have a regular work week, the employee’s wages are considered to be reduced if the employee earns less regular wages in the work week than the average amount of regular wages the employee earned per week in the period of 12 consecutive work weeks that preceded March 1, 2020. (Note that if the employee was not employed by the employer during the entire work week that immediately preceded March 1, 2020, the employee falls into category 3.)
However, per ss. 9(4), if the employee was not employed, was on vacation, was not able to work, was not available for work, was subject to a disciplinary suspension or was not provided with work because of a strike or lock-out occurring at his or her place of employment or elsewhere for any part of a work week in the 12-week period referred to in those paragraphs, then that work week is excluded for the purposes of the averaging.
This formula therefore involves comparing the average regular wages the employee earned in the 12 consecutive work weeks prior to March 1, 2020 (or lesser number of averaged weeks if there are any excluded weeks pursuant to ss. 9(4)) to the regular wages the employee earned in the work week in question during the COVID-19 period.
"Regular wages" is defined in ESA Part I, s. 1 as follows:
In order to establish the period of 12 consecutive work weeks that preceded March 1, 2020, it is necessary to first establish the work week that includes March 1, 2020. From there, look back 12 work weeks.
Next, determine if during any of those 12 work weeks, any of the scenarios set out in subsection (4) apply for any part of a work week. If any of the scenarios apply during a work week, that work week is excluded from the averaging calculation, meaning the average is calculated over a period shorter than 12 weeks. For example, if the only condition that applied during the 12-week timeframe was that the employee was on vacation for a portion of one week, the average of the remaining 11 work weeks would be calculated.
Once the comparator average of the employee’s regular wages is established, the next step is to determine the regular wages the employee earned during the work week in question (i.e. the work week during the COVID-19 period). If the employee earned more regular wages pursuant to the averaging calculation than the regular wages the employee earned during the work week in question, then the employee is considered to have a reduction in his or her wages for the purposes of sections 6, 7 and 8.
If the employee was not employed by the employer during the entire work week that immediately preceded March 1, 2020, then the employee’s regular wages are considered to be reduced if the employee earns less regular wages than they did in the work week in which they earned the most regular wages. This formula applies regardless of whether or not the employee has a regular work week.
Where an employee falls into this category, a comparison is made between the work week in which the employee earned the most regular wages - regardless of when that occurred during the employment relationship - and the regular wages the employee earned during the work week in question during the COVID-19 period.
If the employee earned more regular wages during any previous work week than he or she worked in the work week in question, then the employee is considered to have a reduction in his or her wages for the purposes of sections 6, 7 and 8.
Subsection 9(3) affects the application of paragraph 1 of subsection 9(1) and paragraph 1 of subsection 9(2). These paragraphs establish the formula that applies to determine whether there has been a reduction in hours of work (ss. 9(2)) or wages (ss. 9(3)) for an employee who has a regular work week. (These paragraphs do not apply to employees who were not employed by the employer during the entire work week that immediately preceded March 1, 2020.)
If any of the listed scenarios applied to the employee for any part of the last regular work week before March 1, 2020, then this provision provides that the “comparator” week to be used in the formula is, instead, the last regular work week before March 1, 2020 in which none of the listed scenarios applied for any part of the work week.
The listed scenarios are as follows:
This includes any time during which the employee was on vacation.
This includes any time the employee was not able to work because the employee was, for example, off on sick leave, workers' compensation, or is otherwise unable to work for medical reasons.
This includes any time in which the employee was unavailable for work (for example, because the employee was in jail, or on a Part XIV leave).
This includes any time in in which the employee was on a bona fide disciplinary suspension that was within the employer's express or implied authority under the contract of employment.
This includes any time in which the employee was not provided with work by the employer due to a strike or lock-out at the employee’s place of employment or elsewhere. For example, if there is a strike or lock-out at a supplier, and the employer is a manufacturer dependent upon the supplier for its parts, that employer may be forced to close down until the strike or lock-out is over or a new supplier can be found. In that case, this condition is met. Whether or not the strike or lockout is legal pursuant to the Labour Relations Act, 1995 is irrelevant in applying this condition
Subsection 9(4) affects the application of subsection 9(1) paragraph 2 and subsection 9(2) paragraph 2. These paragraphs establish the formula that applies to determine whether there has been a reduction in hours of work (ss. 9(2)) or wages (ss. 9(3)) for an employee who does not have a regular work week. (These paragraphs do not apply to employees who were not employed by the employer during the entire work week that immediately preceded March 1, 2020.)
If any of the listed scenarios applied to the employee for any part of a work week in the 12-week period referred to in those paragraphs, then that work week is excluded for the purposes of the calculation.
The listed scenarios are as follows:
This includes any time during which the employee was not employed by the employer.
This includes any time during which the employee was on vacation.
This includes any time the employee was not able to work because the employee is, for example, off on sick leave, workers' compensation, or was otherwise unable to work for medical reasons.
This includes any time in which the employee was unavailable for work (for example, because the employee was in jail, or on a Part XIV leave).
This includes any time in which the employee was on a bona fide disciplinary suspension that was within the employer's express or implied authority under the contract of employment.
This includes any time in which the employee was not provided with work by the employer due to a strike or lock-out at the employee’s place of employment or elsewhere. For example, if there is a strike or lock-out at a supplier, and the employer is a manufacturer dependent upon the supplier for its parts, that employer may be forced to close down until the strike or lock-out is over or a new supplier can be found. In that case, this condition is met. Whether or not the strike or lockout is legal pursuant to the Labour Relations Act, 1995 is irrelevant in applying this condition.
Pursuant to subsection 1(2) of this regulation, section 10 does not apply to an employee who is represented by a trade union.
Section 10 provides that sections 6 and 9 of O. Reg. 228/20 apply to assignment employees with necessary modifications. It also provides “for greater certainty” that this regulation applies, in its entirety, to assignment employees.
Section 6 provides that where, during the defined “COVID-19 period”, an employee’s hours of work or wages are temporarily reduced or temporarily eliminated by the employer for reasons related in whole or in part to COVID-19, the employee is not considered to be laid off for the purposes of sections 56 and 63 of the ESA. Section 9 sets out the formulas to be used in determining, for the purposes of this regulation, whether an employee has had a reduction in his or her hours of work or wages during the defined COVID-19 period.
An example of a necessary modification to section 6 relates to the reference in that provision to a temporary layoff under sections 56 and 63 of the ESA. Section 74.11 of the ESA modifies the application of Part XV (“Termination and Severance of Employment”) to temporary help agencies and their assignment employees. Some of these modifications establish different rules from those under s. 56 and s. 63 to determine when an assignment employee is considered to be on a temporary layoff and what are excluded weeks. As such, the reference in section 6 of the regulation to sections 56 and 63 of the ESA is to be read to include the relevant modifications to the temporary layoff scheme that are brought about by section 74.11.
Subsection 50.1(5.2) of the Act establishes that entitlements to paid infectious disease emergency leave end on September 25, 2021 or such later date as may be prescribed. Section 11 of O. Reg. 228/20 prescribes a later end date. It establishes that employee’s entitlements to paid infectious disease emergency leave end on March 31, 2022.
This regulation sets out special rules for certain categories of employees and exemptions to Parts VII to XI which deal with hours of work and eating periods, overtime pay, minimum wage, public holidays and vacation with pay, respectively, and ESA Part XVII, s. 73 that deals with retail business establishments. The regulation also establishes the minimum wage rates for categories of employees and exemptions to those rates.
O Reg 526/17 amended the name of this regulation from “Exemptions, Special Rules and Establishment of Minimum Wage” to “When Work Deemed to Be Performed, Exemptions and Special Rules”, effective January 1, 2018.
The term “construction employee” is referred to in the exemptions from the hours of work, daily rest, and weekly and bi-weekly rest provisions set out in O Reg 285/01. The term construction employee is also referred to in those provisions setting out the exemptions from public holiday entitlements in O Reg 285/01, s. 9(2). See also O Reg 288/01, s. 1 with respect to the construction employee exemptions from notice of termination and severance entitlements in that regulation. Note that although the definition of construction employee in O Reg 285/01 is cross-referenced in O Reg 288/01, employees who are engaged in the maintenance of roads and who are considered construction employees for the purposes of the hours of work exemptions in O Reg 285/01, are not considered construction employees for the purposes of O Reg 288/01. As a result, they are not exempt as construction employees from notice of termination under O Reg 288/01, s. 2(1) paragraph 9. However, they are specifically exempted from severance entitlements under O Reg 288/01, s. 9(1) paragraph 8.
The definition of construction employee includes employees engaged at the site in any of the activities described in the definition of construction industry (i.e., constructing, altering, decorating, repairing or demolishing buildings structures, roads, sewers, water or gas mains, pipe lines, tunnels, bridges, canals or other works) "At the site" simply refers to a place where employees are engaged in construction activities. For example, it would refer to a downtown lot where an office building is being constructed but would also refer to the yard of a manufacturing plant where employees were engaged in constructing storage sheds to store materials or products manufactured at the plant.
Note that despite the reference to “construction industry” within the definition of “construction employee”, the employee's employer does not have to be carrying out construction, alteration, etc., as its sole or even primary business; construction, alteration, etc. could be just a minor or incidental activity so far as the employer is concerned. As a result, the employees of an employer whose primary business is manufacturing would be construction employees if they were engaged in performing construction activities as described in the definition of construction industry at the manufacturing plant.
The definition also includes employees who work off-site (either in whole or in part), if the off-site employees are "commonly associated in work or collective bargaining" with employees who are employed at the site in any of the activities referred to in the construction industry definition (i.e., constructing, altering, decorating, repairing or demolishing buildings, structures, roads, sewers, water or gas mains, pipe lines, tunnels, bridges, canals or other works). Note again that the definition does not require an off-site employee's employer to be solely or primarily engaged in the construction business in order for the employee to be a construction employee; the critical issue is whether the employee is "commonly associated in work or collective bargaining" with employees employed at the site in any of the activities described in the definition of construction industry. See 1703171 Ontario Inc. o/a The Construction Group and Bath Solutions v Russo-Janzen, 2016 CanLII 8145 (ON LRB) for a discussion of what it means to be “commonly associated in work” with on-site construction employees.
The definition includes repair work but not maintenance work. Maintenance is distinguished from repair work in that maintenance involves the preserving of the functioning of a system, whereas repair involves restoration of a system to a functional state. However, the dividing line between maintenance and repair is not always clear, particularly since some maintenance activity may involve procedures that bear a close resemblance to repair (e.g., replacing worn or broken components). In determining whether an employee should be considered to be engaged in repair or in maintenance, one should look to the activity in which the employee spends the majority of their working hours. See: Stearns Catalytic Ltd. v Everingham (September 3, 1986), ESC 2166 (Kerr); Beaver Engineering Limited v Lightfoot and Woods (April 26, 1985), ESC 1840 (Franks); and Warren v Rexway Sheet Metal (January 10, 1995), ESC 95-06 (Palumbo).
However, it is the Program's position that the term construction employee in O Reg 285/01 does include employees engaged in the on-site maintenance of roads (e.g., snow ploughing and salting of roads). The rationale for this position is as follows:
As a result, employees engaged in on-site road maintenance are:
One question that has arisen concerns the definition of construction industry in the Employment Standards Act, 2000 as compared to the definition of construction in the Occupational Health and Safety Act, RSO 1990, c O.1 ("OHSA"). The definition of construction in the OHSA specifically excludes "any work or undertaking underground in a mine" and persons engaged in such work are therefore not considered construction workers for the purposes of the OHSA.
However, the ESA 2000 definition of the construction industry contains no similar exception. Therefore, an employee engaged in the construction of a mine, whether at the surface or underground, is a construction employee for the purposes of the ESA 2000. In this regard, see the Ontario Labour Relation Board's decision in Hollos v Cementation Canada Inc., 2007 CanLII 17545 (ON LRB). In that case, the employee was employed as a "development miner" performing work in the construction of mine shafts. He argued that because he worked primarily underground he was engaged in mining but the Board held that regardless of where it was being performed, the nature of the work was construction and accordingly, he was a construction employee.
The definitions of construction industry and construction employee are substantially the same in scope as the construction industry definition in s. 1(1) of the Labour Relations Act, 1995, SO 1995, c 1, Sch A ("LRA 1995")and the employee definition in the Construction Industry part of the LRA 1995.
"domestic worker" means a person who is employed by a householder to perform services in the household or to provide care, supervision or personal assistance to children, senior or disabled members of the household, but does not include a sitter who provides care, supervision or personal assistance to children on an occasional, short-term basis;
The domestic worker definition is referred to in the special rules for domestic workers section in O Reg 285/01, s. 19. These special rules require the employer to provide the domestic worker with written particulars of employment, and sets out special rates for room and board.
Domestic workers are defined to include persons who are employed by the householder to perform services in the household (e.g., housekeeping or cleaning) as well as those providing care, supervision or personal assistance to children, senior or disabled members of the household. The definition makes no distinction between full-time, part-time, live-in or live-out workers. However, the definition specifically excludes babysitters who work on an occasional and short-term basis.
A domestic worker must be employed by the householder of the residence where they work. If the householder hired the worker through an agency, they are still a domestic worker if it is the householder who employs the worker and the householder was just using the agency as a "head-hunter". However, if the householder contracts with the agency for services and the employee is employed by that agency, or if the worker, although working in the residence is employed not by the householder but by some other employer, this definition will not apply (although the worker may be a homemaker in that case).
A domestic worker is defined to include persons employed by the householder who perform services in the household. This would include such functions as cleaning, dusting, vacuuming, laundry and the preparation of meals. A domestic worker is not a homeworker. See ESA Part I, s. 1(1) for the definition of homeworkers and ESA Part and O Reg 285/01, s. 12 for further information regarding the special rules that apply to homeworkers.
An employee will fall under the definition of domestic worker if they provide care, supervision or personal assistance to a child of the householder. This would include a nanny who has received formal training in child care as well as a sitter who has had no formal training. Note, however, that a sitter who provides care on an occasional, short-term basis is not covered under the definition of domestic worker. For example, a teenager who occasionally babysits on weekend evenings for a neighbour would not fall under this definition.
To fall within this category of domestic worker, the employee would have to be providing care, assistance, supervision or protection to a person who, because of advanced age or physical or mental disability, cannot care for their own needs. The services could include household work related to the care of the person (for example, meal preparation, bed-making, etc.). In addition, the worker must be employed by the householder and be attending to the needs of a member of the employer's household. Thus, for example, the definition would not apply to someone employed to provide personal care to a resident in a nursing home, where the employer is the resident's adult son who does not live in the nursing home, even if the resident used to live in the son's household.
The definition of “election official” was added to section 1 of O Reg 285/01, effective March 9, 2018. The definition of election official covers:
Note that each riding has a returning officer who is appointed by the Lieutenant Governor in Council for a ten-year term.
In order to fall under clause (b) of this definition, the following must be met:
Note that the reference to indirect management or supervision means that the exemption can apply even if the returning officer is not the immediate manager or supervisor of the employee in question.
For example, a poll clerk who is supervised by a deputy returning officer, who in turn is supervised by a returning officer, would be “indirectly” supervised by a returning officer for the purposes of this definition.
In order to fall under clause (c) of this definition, the following must be met:
In other words, if an employee provides support to all electoral districts, the employee would not meet the definition as set out in clause (c).
Election officials defined in this section are referred to in O Reg 285/01, s. 4(1)(g). During the period specified in section 4(1.1), these employees are exempt from s. 17, 18 & 19 of the ESA, which cover the hours of work, daily rest, and weekly and bi-weekly rest provisions of the Act.
This definition is referred to in the public holiday exemption in O Reg 285/01, s. 9(1)(j) regarding seasonal workers in such establishments, i.e., those who work 16 weeks or less in a calendar year and who are provided with room and board. It is also referred to in O Reg 285/01, s. 14, which establishes special rules and exemptions for overtime pay for employees in such establishments who are employed for 24 weeks or less in a calendar year and who are provided with room and board.
Information technology professionals ("IT professionals") as defined in this section are exempt from the hours of work provisions in ESA Part VII by O Reg 285/01, s. 4(3)(b) and overtime pay provisions in ESA Part VIII by O Reg 285/01, s. 8(1).
It is important to note that this definition does not include all people working in the information technology field.
The exemption is limited to professional employees who use specialized knowledge and professional judgement in their work. Webster's Third New International Dictionary defines "professional" as a person "engaged in one of the learned professions or in an occupation requiring a high level of training and proficiency" and "characterized by or conforming to technical or ethical standards of a profession or occupation". "Judgement" is defined as "the mental or intellectual process of forming an opinion or evaluation by discerning or comparing".
It is the Program's view that employment as an information technology professional would be characterized by the exercise of professional judgement requiring the application of specialized knowledge in accordance with technical standards. For example, this could include the assessment of the information systems needs of a client and the evaluation of risks and benefits associated with the various options in accordance with generally accepted principles in the computer and related technologies field. The Program would consider an employee who is responsible for the development of a company's software or the day-to-day maintenance of a company's software and hardware products to be an IT professional. On the other hand, an employee whose responsibility was to repair or "trouble-shoot" home computers sold by their employer would not be considered to be an IT professional.
In addition, a person using the hardware and software products developed and maintained by IT professionals would not themselves be considered IT professionals. For example, persons employed as computer animators would not likely be considered IT professionals as their work would involve using the systems and software created by IT professionals but would not involve developing or maintaining such systems or software. Note however that some computer animators may fall within the definition of employees in the recorded visual and audio-visual entertainment industry and consequently would be exempt from the hours of work and eating periods in the Act.
Although "related technologies" is not defined, the Program would not consider an employee who was responsible for the development or operation of "high tech" equipment such as TVs, DVDs or stereos to be an IT professional.
Formal educational attainment or the absence thereof is not determinative of whether the employee will be exempt. The Program will also recognize informal, on the job training and experience and training outside the traditional education sector.
In applying this definition, it is necessary to recognize that there will also be non-professional information technology staff, such administrative and support staff. These employees may perform routine tasks involving or pertaining to information technology, but they do not perform the more sophisticated tasks contemplated in the definition and will not be exempt. If a job description includes a large proportion of tasks that are not specific to the information technology field, it will not likely be exempt. Furthermore, the mere fact that an employee works for an information technology business does not mean that the exemption will apply. Conversely, an IT professional may be employed by an employer that produces cars, TVs or furniture.
The "recorded visual and audio-visual entertainment production industry" definition refers generally to the film and television industry. This definition is relevant to O Reg 285/01, s. 4, which exempts all employees in that industry from Part VII Hours of Work and Eating Periods, and O Reg 285/01, and O Reg 285/01, s. 9.1, which exempts employees in that industry from ESA Part XII, s. 42.1. Such employees include all employees of foreign and domestic companies that produce recorded visual and audio-visual entertainment in Ontario. This may include employees working as computer animators in the recorded visual and audio-visual industry.
The exemption generally does not apply to live performers in that industry as they typically do not fall within the definition of "employee" in ESA Part I, s. 1.
The residential care workers as defined in O Reg 285/01 are subject to special rules and exemptions regarding hours of work, free time, overtime, minimum wage entitlement and records of hours as set out in O Reg 285/01, ss. 20 to 23.
The definition of residential care worker in O Reg 285/01 has a number of elements as follows:
"Supervision" and "care" are broad terms and include all those activities involved in looking after children and developmentally handicapped adults: preparing meals, feeding, cleaning, organizing play activities, and so on. An employee may perform duties that are similar to a domestic worker, a superintendent, or a caretaker. However, if they perform those duties in a residential care facility and meets the other requirements of O Reg 285/01, this regulation will apply. See Marshall Children's Foundation v Grieve et al (November 8, 1976), ESC 378 (Aggarwal).
Children are generally considered by the Program to be persons under the age of 18 years. Previously, it was the Program's policy that developmentally handicapped persons were considered to be persons with a condition or handicap that was present or occurred before the age of 18 years, which was consistent with the Board's decision in Pacaldo v Dolega-Kamienski Estate, 2003 CanLII 35096 (ON LRB). In that decision, the Board referred to the Day Nurseries Act, RSO 1990, c D.2 (repealed) and the Developmental Services Act, RSO 1990, c D.11 (repealed), which defined the term "developmentally disabled" as "a condition of mental impairment present or occurring during the person's formative years . . .", and a definition from an authoritative medical dictionary which defined "developmental disability" as a "substantial handicap of indefinite duration with the onset before the age of 18 years, such as mental retardation, autism, cerebral palsy, epilepsy or other neuropathy", and concluded that "developmentally handicapped" has the same meaning as developmentally disabled. As a result, where a disability was related to such things as the aging process (e.g., Alzheimer's disease) or an accident, the Program did not consider the person to be developmentally disabled for the purposes of the residential care worker rules and exemptions in O Reg 285/01, ss. 20 to 23.
However, in Lorraine Fraser Viscount Residence et al. v Ontario Labour Relations Board et al., the Divisional Court overturned an Ontario Labour Relations Board decision that held that two applicant group homes which provided residential care for schizophrenic adults were not entitled to the residential care worker exemptions and special rules because there was no evidence before the Board that the residents of the group homes were diagnosed with schizophrenia before the age of 18. In reversing the Board's decision, the Court expressed concerns about the imposition of the "18 year old" test saying that while the Board had addressed the purpose of the ESA, it had failed to consider the purpose of the exclusion or exemption for residential care workers, which it said is to facilitate the operation of the homes, while at the same time protecting workers.
As a result, the Program has amended its operational policy to now consider a person to be developmentally disabled for the purposes of the residential care worker rules and exemptions in O Reg 285/01, ss. 20 to 23 if the person possesses a disability of indefinite duration, manifested in their formative years, that is characterized by significant limitations to cognitive and adaptive functioning. "Cognitive functioning" refers to a person's intellectual capacity, including the capacity to reason, organize, plan, make judgments and identify consequences. "Adaptive functioning" refers to a person's capacity to gain personal independence, based on the person's ability to learn and apply conceptual, social and practical skills in their everyday life.
Only work in a residential care facility that is designed to provide a home-like atmosphere is covered. Work in an institution, such as a hospital, is not covered.
Program policy is that the employee must be required by the employer to reside at the facility and must actually do so, that is, eat, sleep, and spend rest periods there. If the employer merely provides accommodation for the employees and it is their option whether or not to use them, the regulation does not apply. The regulation is meant to apply in those situations where it is essential that the worker remain at the facility virtually 24 hours per day.
"Work period" refers to the period between the time the employee enters the facility for the purpose of working and residing there through to the time when they leave. Residence need not be permanent in order for the regulation to apply. In other words, the employee may have accommodation elsewhere where they reside when not on a shift. For example, an employee may be scheduled to work a set number of days at the facility, until they are relieved, at which time they can leave and live elsewhere.
Employees who are engaged in "road building" are subject to special rules (different overtime thresholds) for overtime pay as set out in O Reg 285/01, s. 13.
Employees engaged in road building will also fall under the general definition of construction employees in O Reg 285/01, s. 1. As a result, such employees may also be exempt from the hours of work, daily rest and weekly and bi-weekly rest provisions and public holiday provisions of the Act. See the discussion of the definition of construction employee above for further information.
The seasonal employee definition is referenced in O Reg 285/01, s. 9(1)(j) and s. 15.
Section 9(1)(j) establishes an exemption from the public holiday provisions of the Act for seasonal employees of a hotel, motel, tourist resort, restaurant or tavern, who are provided with room and board.
Section 15 establishes special rules and exemptions for overtime pay for seasonal employees in fresh fruit and vegetable processing.
This definition is referenced in O Reg 285/01, s. 8(j) and s. 9(1)(i), which exempt taxi cab drivers from overtime pay and public holiday pay.
In order for a vehicle to be a taxi cab, both elements of the definition must be met; it must seat no more than nine people (not counting the driver), and it must be used for the carriage for hire of people. Therefore, a car driven by a private chauffeur for one employer is not a taxi cab; nor is a bus that seats more than nine people plus the driver (even if it is often the case that nine or fewer people are actually riding in it).
Employers sometimes operate a mix of regular taxi cabs and larger vehicles that seat more than nine people. Employees who drive both types of vehicles will fall under this definition for the purposes of the overtime and public holiday exemptions, only if they spend the majority of their time driving vehicles that fall within the definition of taxi cab.
This definition applies with respect to the wage statement obligations in ESA Part V, s. 12. Under that section, an employer is required to provide, on the employee's pay day, a written statement setting out, among other things, the employee's wage rate.
The definition is inclusive but is intended to indicate what an employee's wage rate is if the employee is paid on a piecework basis. The definition provides that wage rate includes the piece rate or rates together with the number of pieces paid at each rate.
For example, in the case of fruit, vegetable or tobacco harvesters it may refer to the rate paid for each of bushel or pound of produce harvested by the employee and the number of bushels or pounds paid for.
In the case of homeworkers, the piece rate would be the rate paid for a specified number of articles or things manufactured. "Manufacture" is defined in O Reg 285/01, s. 12(3) to include preparation, improvement, repair, alteration, assembly or completion. See O Reg 285/01, s. 12 for information regarding special rules for homeworkers.
but does not include,
This definition was added to s. 1 of O.Reg. 285/01 effective June 3, 2019.
This definition is referenced in O. Reg. 285/01, s. (4)(1)(c), s. 6, s. 8(c), and s. 9(1)(b). These provisions:
This definition is also referenced in O. Reg. 285/01, s. 4.1(a) - (c) and s. 7(a) - (c) to clarify which set of exemptions/special rules applies when someone is both a wilderness guide and a student employed in camps for children/charitable recreational programs. See the discussion under those sections for details.
A wilderness guide is a person employed to guide, teach or assist one or more persons while those persons are engaged in activities in a wilderness environment.
Whether the wilderness guide definition applies to an employee is determined by what the employee was employed to do. This means that the definition will apply to an employee who is employed to guide, teach or assist people when they are engaged in activities in a wilderness environment, even if some of the employee’s time is spent performing tasks that are not guiding, teaching, or assisting, and even if some of the employee’s time is spent performing tasks outside of the wilderness environment. For instance, the duties of wilderness guides may also include preparatory work for expeditions, such as terrain research or equipment testing.
For example, a 20-year-old employee who is employed to teach the business’s clients rock-climbing in a wilderness environment may spend time – sometimes a significant amount of time – checking, preparing and packing the equipment before the clients arrive. Because this employee is employed to teach people rock-climbing in a wilderness environment, the wilderness guide definition will apply to that employee, and the wilderness guide exemptions and special minimum wage rate will apply to that employee, even during the time the employee dealt with the equipment prior to the clients’ arrival.
As another example, a 25-year-old employee who is employed to guide people on their canoe trip in a wilderness environment may spend time – sometimes a significant amount of time – travelling with the clients in a non-wilderness environment to the site where the canoeing will begin. Because this employee is employed to guide people while they are engaged in canoeing in a wilderness environment, the wilderness guide definition will apply to that employee, and the wilderness guide exemptions and special minimum wage rate will apply to that employee, including during the time the employee travels to the wilderness environment.
The two examples above are to be distinguished from a situation where an employee may have two (or more) distinct roles with an employer at different times of the year, only one of which is to guide, teach or assist people who are engaged in activities in a wilderness environment. For example, an employee may be engaged in sales and marketing for seven months of the year and in guiding for five months of the year. If the criteria for the wilderness guide definition are met during the five months the employee is engaged to guide, the employee will be considered to be a wilderness guide for those five months and will be subject to the wilderness guide exemptions and special minimum wage rate for those five months.
There is no minimum amount of time an employee must be in the wilderness environment for the definition to apply. For example, if a 20-year-old employee is employed to assist the employer’s clients while the clients are rafting in a wilderness environment, the employee will be considered to be a wilderness guide – and subject to the wilderness guide exemptions and special minimum wage rate – even if the employee is able to return home every evening because the rafting trips are only of a few hours’ duration and the employee lives nearby.
The wilderness guide definition contains a list of activities in a wilderness environment that may bring an employee within the scope of the wilderness guide definition. The list of activities is not exhaustive.
Accordingly, the wilderness guide definition may apply to employees who are employed to guide, teach or assist people while they are engaged in other activities in a wilderness environment (i.e. activities that are not listed in clauses (a) through (i)). To be considered an activity to which the wilderness guide definition may apply, however, the unlisted activity must be the same type of activities to the ones that are listed. For example, the Program does not consider paintballing or tree planting to be activities captured by the wilderness guide definition even if they take place in a wilderness setting because the nature of these activities is not the same as the nature of the items that are listed.
The definition does not require that the people who are engaging in the activity be doing it for any particular purpose or reason in order for the wilderness guide definition to apply. For example, the definition can apply whether the people are engaging in the activity in a wilderness environment for recreation (e.g. a group of friends go on a back-country skiing trip for pleasure), for personal development (e.g. an individual learning a new skill in a new environment), for academic purposes (e.g. university students go on a wildlife viewing trip for their studies), or for therapy or treatment purposes (e.g. a group of teenagers who have had conflicts with the law go on a survival training trip for rehabilitative reasons).
The activity or activities must take place in a wilderness environment. What is a wilderness environment will depend on the facts in each situation and will be determined on a case-by-case basis.
The wilderness guide definition explicitly excludes hunting and fishing guides, and students under 18 years of age who work 28 hours each week or less during school or who are employed during a school holiday. Accordingly, these employees will not be covered by the wilderness guide exemptions and special minimum wage rule even if they are employed to guide, teach or assist people while they are engaged in activities in a wilderness environment. For example, a 17-year-old student on school holiday employed at a camp for children to guide and assist campers on multi-day hiking trips would be excluded from the wilderness guides definition.
Section 1.1(1), which deems work to be performed in certain circumstances, is subject to s. 1.1(2), which sets out circumstances where work will not be deemed to be performed. As a consequence, in the circumstances set out in s. 1.1(2), work will not be deemed to be performed even though it would otherwise be deemed to have been performed under s. 1.1(1).
The fact that O. Reg. 285/01, s. 1.1(1) deems work to be performed in specified circumstances means that the deemed working time must be taken into account in determining compliance with the statutory requirements, such as the hours of work, minimum wage and overtime pay standards*. How the employee is paid for that time however, is a separate issue. Under the ESA, it is possible for an employee to be paid different rates for different types of work, including receiving no financial compensation or a rate that is lower than the hourly minimum wage rate for some types of work (so long as the minimum wage requirements, which are based on a pay period basis, are met). See “Payment for Time Worked” at the end of the discussion on s. 1.1 for details.
Section 1.1(1)(a)(i) provides that an employee is considered to have performed work if the employer allowed the employee to perform work. In other words, it is not necessary that the employer have asked or authorized the employee to do the work; the employee will be considered to have performed the work if the employer was aware that the employee was working or could have anticipated that they might be working but failed to take steps to prevent it. In M. Alzner Contractors Ltd. v Standard (December 16, 1985), ESC 2015 (Brown), the referee found that the employer had "permitted or suffered" work to be done by the employee because the employer knew that the employee was present on the job site, but did not ask him to leave or instruct him not to engage in any work on behalf of the employer. Similarly, employees who perform work prior to the start of their scheduled shift (e.g. because the employee regularly arrives at the workplace early) or after the end of the scheduled shift (e.g. because the employee is finishing up with a customer) will be considered to be performing work during that time so long as the employer was aware or could have anticipated that the employee might be working and didn’t take steps to prevent it.
Section 1.1(1)(a)(ii) is, in effect, an elaboration of s. 1.1(1)(a)(i). It provides that work is deemed to be performed if it is in fact performed, even though the employment contract prohibited the performance of the work or the employee failed to obtain the employer’s approval despite the fact that the contract required such approval. For example, work was deemed to be performed where the employee"s actual hours of work exceeded those for which the employee was scheduled - see Weiche-Huttenkofer Corporation Limited v Masschelein (August 25, 1980), ESC 872 (Gorsky); and where the employee performed work that was not authorized in advance as required by the employer - see 469754 Ontario Limited o/a Rumors Restaurant & Tavern v Lalonde (October 16, 1982), ESC 1305 (Betcherman). The fact that the work performed by the employee was unnecessary (i.e., it was not required to be done) does not render s. 1.1(1) inapplicable - see Keyes Supply Company Limited o/a Amalgamated Iron & Metal Co. v Cabral (February 15, 1979) ESC 582 (Picher); nor does the fact that the work was unsatisfactory - see The Living Institute v Roberts (March 6, 1978), ESC 489 (Haladner) and Elgin Lumber & Packaging Corp. Ltd. v Tait et al (June 19, 1978) ESC 524 (Brent).
i. Section 1.1(1)(b)(i) provides that work is deemed to be performed where an employee is not in fact performing work but is required to be at the place of employment waiting to be called to work.
Where the employee is holding themselves ready for work but not at the place of employment, work is not deemed to be performed. See 379480 Ontario Ltd. c.o.b.a. Arlington Public House and Restaurant v Kish (November 26, 1981), ESC 1107 (Davis) and the discussion in s. 1.1(2) below.
ii. Section 1.1(1)(b)(ii) provides that work is deemed to be performed where an employee is not in fact performing work but is required to be at the place of employment while on a break or rest period other than an eating period. See Cardelli and Cardarelli o/a Dina's Beauty Salon v Grey (March 6, 1978), ESC 488 (Springate) where the employee was at his place of work, ready for a call to work, but not actively working.
If the employee is allowed to leave or is required to leave the place of employment during a break, work will not be deemed to be performed - see Cancoil Thermal Corporation v Hawkins (April 13, 1999), 4529-97-ES (ON LRB).
There may be situations where some employees are deemed to have performed work during their breaks while others are not, for example, at workplaces where employers require employees who wish to smoke on their breaks to leave the place of employment, while requiring non-smoking employees to stay. Neither the ESA 2000 nor the regulations prohibit that kind of situation. Generally speaking, "place of employment" for the purposes of O Reg 285/01, s. 1.1(1) may encompass both the building and the land, including the parking lot, owned by the employer, but would exclude public sidewalks and roads.
The question as to when time constitutes “work” for the purposes of the ESA often arises. The Program’s policy for some scenarios in which this question has arisen is set out below.
It is Program policy that any time a person spends traveling (irrespective of the mode of transportation) for the purpose of getting to or from some-where where work will be or was performed, with the exception of commuting time, counts as working time.
Commuting time for an employee who has a usual workplace means the time required for the employee to travel to their usual workplace from home and vice versa.
In situations where an employee does have a usual workplace but is required to travel to a location other than the usual workplace to perform work, all time spent travelling to and from that location is considered working time rather than commuting time. For example, if an employee who usually works in City A is required to travel to City B for work, all time spent getting either from home or the workplace in City A (depending on whether the employee was beginning their journey from home or the workplace) to the destination in City B will count as working time. (In the case where the employee travels by air, for example, the time spent getting to the airport, waiting to get on the plane, time on the plane and time spent getting to the destination in City B after the plane lands all counts as working time.)
In situations where an employee does not have a usual workplace, commuting time is generally considered to be the time it takes the employee to get from their residence to the first work location and the time it takes for the employee to get home from their last work location. For example, if an employee works for a housecleaning service, time spent travelling from their home to the first residence they are scheduled to clean is considered to be commuting time as will the trip home from the last residence. However, time spent travelling during the work day to go from residence to residence would be considered working time rather than commuting time. If the employee is required to attend at the employer’s shop at the start of the shift in order to pick up supplies and at the end of the shift to drop off the supplies and do paperwork, the time spent travelling from the shop to the first house and from the last house to the shop is considered working time. See, for example, Hopkins v 1719453 Ontario Inc. (Clean Team), 2012 CanLII 25680 (ON LRB).
As noted, commuting time is not counted as working time. However, there are exceptions to this rule:
It is Program policy that time spent in training that is required by the employer or by law as a condition of employment or continued employment will be considered working time.
Training that is taken at the option of the employee, i.e., training that is not required by the employer as a condition of employment or continued employment or that is not otherwise necessary for the performance of the employee’s job would not be considered working time. This includes training that is required to meet the qualifications for a new position with the current employer (e.g., a course and certificate in project management as a condition for promotion to manager).
Employees are often required for practical reasons to be at their workplace and/or to perform work functions in advance of their scheduled shift start time in order to ensure they are ready at their workstation (be in the right place such as, for example, a desk, in front of a cash station, on an assembly line, etc.) to start their shift on time. Some situations that would require an employee to arrive at the workplace in advance of his or her scheduled shift include:
The Program considers that where it is necessary for the employee to spend time or to perform functions in the workplace in order to start a shift on time, that time is considered working time.
The same policy applies with respect to time spent performing functions after the end of a shift. For example, time after the end of the scheduled shift that an employee spends counting the cash in the till or waiting in line to punch out at the time clock is considered working time.
A related issue arises when employers deem employees to have worked less time than they in fact did for purposes of calculating employees’ wages.
For example, some employers may, under the terms of the employment contract, pay an employee who punches in more than 5 minutes but fewer than 15 minutes late wages only for 45 minutes for that hour. This method of calculating an employee’s wages is not prohibited under the Act. (Although note that depending on the employee’s wage rate, there may be an issue with minimum wage compliance — see the discussion udner “Deductions, s. 13(1)”.)
However, compliance with the hours of work provisions is determined on the basis of time worked (whether actually worked or deemed to have been worked under this section of the regulation), not on the provisions of the contract that might, in some circumstances, deem the employee to have worked less time than he or she in fact did.
Once it is determined that time is considered working time, the next issue is whether the employee is entitled to be paid for that work, and if so, at what rate. The question to be answered is what pay, if any, was payable under the contract in respect of the work.
The ESA does not prohibit employers from entering into contracts with employees to pay them different rates for different types of work, including paying some types of work at a rate that is lower than the hourly minimum wage rate — including no payment at all — so long as the minimum wage requirements, which are based on a pay period basis, are met.
For example, a contract may provide that the time an employee spends lining up to punch in and out will not be compensated, even though that time is considered to be work. Or, it may provide that the time an employee spends donning and doffing personal protective equipment at the workplace will not be compensated even though that time is considered to be work. Similarly, a contract may provide that travel time will be compensated at 50% of the employee’s regular rate. These types of contractual terms are not prohibited under the ESA, so long as the minimum wage requirements — compliance with which are determined on a pay period basis, not an hourly basis — are satisfied.
The contractual terms regarding payment may be explicitly set out in a written contract, but in many cases they won’t be and officers will rely on other evidence, including the individual employee’s understanding, to determine what the parties’ agreement — explicit or implied — was with respect to payment.
Section 1.1(1), which deems work to be performed (e.g., where work was permitted or suffered to be done or the employee was on-call at their place of work), is subject to s. 1.1(2). As a consequence, in the circumstances set out in s. 1.1(2), work will not be deemed to be performed, even though it would otherwise be found that work had been performed pursuant to s. 1.1(1).
An example of the joint effect of ss. 1.1(1) and (2) occurs where a live-in employee is required to remain on the premises of an employer operating a remote location hunting or fishing camp. If the employee is called to do work from time to time as the need arises, without any defined period(s) of time off, they will be deemed, pursuant to s. 1.1(1)(b)(i), to be working during all hours. This, however, is subject to s. 1.1(2), which states that work is not deemed performed during the time an employee is entitled to take time off for eating, sleeping or private pursuits. In order to apply s. 1.1(2), the employer must demonstrate that the employee was in fact entitled to take such time off.
Section 1.1(2)(a)(i) establishes that where the employee is entitled to take time off for a meal break, that time will not be deemed to be work time.
Note that while an employee may ostensibly have an entitlement to take time off, there may be no entitlement in fact. For example, if the employer advises an employee that they have an eating period at, say, noon, each day but then makes it impossible for the employee to take the break, s. 1.1(2) would not apply. As a result, the meal break would not be deemed non-work time. (In such a case, there may also be a violation of the ESA Part VII, ss. 20 and 21 requirement to provide the employee with a meal break.)
For example, if the employer provides a meal break from 1:00 to 1:30 p.m. but advises the employee at 1:00 p.m. that 50 widgets must be made by 1:30 p.m., the employer has effectively denied the entitlement to the meal break. No entitlement means that s. 1.1(2) does not apply and the officer will find that work was performed. Note that if the employee decided on their own initiative to make another 50 widgets between 1:00 and 1:30 p.m., that time would not count as hours of work. The employee was entitled to take the meal break and, therefore, work is deemed not to be performed during that period.
The Program takes the position that an employee may be required to take an ESA Part VII, s. 20 meal break in a designated place (e.g., on the employer's premises) and to be on call while on that break. If an eating period is not provided in compliance with ESA Part VII, s. 20(1) or (2), because the employee was on call and the meal break was interrupted, the employee is considered not to have had a meal break for the purposes of s. 20. As a result, s. 1.1(2) will not apply and the officer will find that work was performed as per s. 1.1(1)(b).
For example, an employer provides a 30-minute eating period for an employee and requires the employee to take his/her eating period in a designated place on the employer's premises and to be on call. The employee is only able to complete 20 minutes of the 30-minute eating period before getting called back to work. Because the employee was not able to have an uninterrupted 30-minute eating period, a s. 20(1) eating period is considered not to have been provided, and a new uninterrupted 30-minute period must be given. Further, because a s. 20(1) eating period has not been provided, the 20 minutes taken would not be considered an eating period and the "work deemed not to be performed" provision of s. 1.1(2)(a)(i) would not apply. The 20 minutes would be deemed to be work performed under s. 1.1(1)(b).
Similarly, the above would also apply to situations under s. 20(2) where the eating period is split into two periods of time that total 30 minutes within a five hour period. For example, an employer and employee have agreed that the employee will receive two 15-minute eating periods within a five hour period of work. The two 15-minute periods are not scheduled and the employer requires the employee to take the eating period on the employer's premises and to be on call while on break. The employee is able to take the first 15-minute eating period without an interruption. However, 10 minutes into the second 15-minute eating period, the employee is called back to work. Because the second 15-minute eating period was not completed, s. 20(2) has not yet been complied with. Another 15-minute eating period must be provided in order to achieve compliance with s. 20(2). Should the employee not be able to complete the second 15-minute eating period within a 5-hour period of work, then there would not be compliance with s. 20(2). All of the break time taken, including the first 15-minute break would not be considered an eating period per s. 1.1(2)(a)(i) and would be deemed to be work per s. 1.1(1)(b).
Section 1.1(2)(a)(ii) establishes that a sleeping period of at least six hours where sleeping facilities are provided by the employer will not be deemed to be work time so long as the employee is entitled to the time off. The employee must be entitled to uninterrupted sleep for at least six hours and entitled to refuse work during the period designated as a sleep period in order for the sleeping period to be deemed non-working time. If the employee does not have the right to refuse work during the sleeping period, the entire sleeping period is included in hours of work, whether or not the employee is actually called on to work - see Stark v Kerry's Place (Autism Services) (June 16, 1999), 3048-97-ES (ON LRB).
Section 1.1(2)(a)(iii) establishes that when an employee is given time off to engage in private affairs or pursuits, the employee will not be considered to be working. For this provision to apply, it must be clear that the employee was entitled to take the time off and was not simply on-call, waiting to be assigned or put to work.
Section 1.1(2)(b) establishes that on call employees are not considered to be working if they are not at their place of employment while waiting to be called in to work - see 379480 Ontario Ltd. c.o.b.a. Arlington Public House and Restaurant v Kish. For a discussion of what is meant by on call see ESA Part VII, s. 18(2).
The professionals listed above are exempt from the Hours of Work and Eating Periods (Part VII), Three Hour Rule (Part VII.1), Overtime Pay (Part VIII), Minimum Wage (Part IX), Public Holidays (Part X) and Vacation with Pay (Part XI) provisions of the Employment Standards Act, 2000.
In order for the exemption to apply, two conditions must be met. For the professionals listed in s. 2(1)(a), the employee must be "duly qualified" and must be a "practitioner" of the profession.
For the professionals listed in s. 2(1)(b) the employee must be "duly registered" and must be a "practitioner" of the profession.
The employees listed in s. 2(1)(a) must be entitled to practice the profession under the following legislation:
| Profession | Legislation |
|---|---|
| Architecture | Architects Act, R.S.O. 1990, c. A.26 |
| Law | Law Society Act, R.S.O. 1990, c. L.8 |
| Professional Engineering | Professional Engineers Act, R.S.O. 1990, c. P.28 |
| Public Accounting | Public Accounting Act, 2004, S.O 2004, c. 8 |
| Surveying | Surveyors Act, R.S.O. 1990, c. S.29 |
| Veterinary Science | Veterinarians Act, R.S.O. 1990, c. V.3 |
The employees listed in s. 2(1)(b) must be duly registered under the following legislation:
| Profession | Legislation |
|---|---|
| Chiropody | Chiropody Act, 1991, S.O 1991, c. 20 |
| Chiropractic | Chiropractic Act, 1991, S.O 1991, c. 21 |
| Dentistry | Dentistry Act, 1991, S.O 1991, c. 24 |
| Massage Therapy | Massage Therapy Act, 1991, S.O 1991, c. 27 |
| Medicine | Medicine Act, 1991, S.O 1991, c. 30 |
| Optometry | Optometry Act, 1991, S.O 1991, c. 35 |
| Pharmacy | Pharmacy Act, 1991, S.O 1991, c. 36 |
| Physiotherapy | Physiotherapy Act, 1991, S.O 1991, c. 37 |
| Psychology | Psychology Act, 1991, S.O 1991, c. 38 |
The practitioner in a profession described in s. 2(1)(a) or s. 2(1)(b) must be duly qualified or registered under the legislation referred to above.
For example, "duly qualified practitioner of . . . law" means an individual who is licensed by the Law Society of Ontario to practice law. Paralegals are not covered by this exemption, because although they are governed by the Law Society Act and Law Society of Ontario, they are licensed only to "provide legal services", not to "practice law".
A duly qualified practitioner of architecture includes an architect, intern architect and a student architect licensed to practice architecture by the Ontario Association of Architects ("OAA") under the Architects Act. It may also include persons designated as Licensed Technologists if they are issued a restricted or limited certificate of practice by the OAA.
Note that a midwife is not considered to be a practitioner of medicine as the practice of midwifery is governed by the Midwifery Act, 1991, SO 1991, c 31 and not the Medicine Act, 1991.
A duly qualified practitioner of public accounting refers to a person who is a practitioner of and who is qualified to practice public accounting under the Public Accounting Act, 2004 ("PAA"). This means that the employee either:
The Public Accountants Council for the Province of Ontario (the Council) is the corporate body that oversees the regulation of public accounting in Ontario. The Public Accountants Council may authorize other organizations (called "designated bodies") to license and govern the activities of their members as public accountants. In order to become an "authorized designated body", the designated body must meet certain standards set by the Public Accountants Council.
The Public Accountants Council had previously authorized the following "designated bodies" to issue licenses to its members to practice public accounting in Ontario:
As a result, individuals licensed to practice public accounting under the PAA may include members of the Institute of Chartered Accountants Association of Ontario, members of the Certified General Accountants of Ontario, and members of the Certified Management Accountants of Ontario.
In 2014, the three designated bodies amalgamated into the Chartered Professional Accountants of Ontario (CPA Ontario) in 2014.
Effective May 17, 2017, this amalgamation was recognized in the Chartered Professional Accountants of Ontario Act, 2017 (CPA Act). CPA Ontario is now the sole “designated body” under the Public Accounting Act, 2004 authorized to license its members to practice public accounting in Ontario and govern the activities of its members as public accountants.
Concurrent with the coming into force of the CPA Act, the enabling statutes for the predecessor designated bodies (Certified General Accountants Act, 2010, Certified Management Accountants Act, 2010 and the Chartered Accountants Act, 2010) were repealed. However, all members of the former three designated bodies carry a CPA Ontario designation in conjunction with their legacy designation until November 1, 2022.
A person may also be duly qualified to practice public accounting under the PAA even though he or she is not required to hold a license if she or he provides public accounting services exclusively in respect of:
Therefore, an employee who provides public accounting services exclusively for one of the above-listed organizations, may be considered duly qualified in the practice of public accounting even if he or she has not been issued a license in public accounting.
An employee in a profession described in s. 2(1)(a) or s. 2(1)(b) above must actually be practising the profession in order for the exemption to apply. For example, a store clerk who is a member of the Law Society of Upper Canada Ontario is duly qualified; however as she is not practising law, the exemption will not apply.
With respect to what is meant by the "practice" of public accounting, the Public Accountants Council for the Province of Ontario defines public accounting as: the business of expressing independent assurance and certain other services in respect of financial statements and other financial information of enterprises where it can reasonably be expected that the services will be relied upon or used by a third party.
For clarity, a person is not practising public accounting if he or she is engaging solely in bookkeeping, cost accounting, or the installation of bookkeeping or business systems. Likewise, the preparation of financial statements solely as part of tax returns without provision of an opinion independent of the taxpayer in respect of the financial statements, is not considered practising public accounting.
This clause was amended effective January 1, 2019 to replace the reference to the (repealed) Drugless Practitioners Act (DPA) with a reference to the Naturopathy Act, 2007. (At the time of the repeal the only remaining class of drugless practitioners under the DPA were the drugless therapists/naturopaths.)
A duly registered naturopathic practitioner is exempt from the Hours of Work and Eating Periods (Part VII), Three Hour Rule (Part VII.1), Overtime Pay (Part VIII), Minimum Wage (Part IX), Public Holidays (Part X), and Vacation with Pay (Part XI) provisions of the Act.
In order for the exemption to apply, the employee must be duly registered under the Naturopathy Act, 2007, R.S.O. 1990, c. D.18 ("DPA") and be practising the profession of naturopathy. The Naturopathy Act, 2007 (s. 3) defines the practice of naturopathy as follows:
“The practice of naturopathy is the assessment of diseases, disorders and dysfunctions and the naturopathic diagnosis and treatment of diseases, disorders and dysfunctions using naturopathic techniques to promote, maintain or restore health.”
All persons who were registered to practice under the Drugless Practitioners Act by the Board of Directors of Drugless Therapy immediately before July 1, 2015 were deemed to be holders of a certificate of registration issued under the Naturopathy Act, 2007.
Certain teachers are exempt from the Hours of Work and Eating Periods (Part VII), Three Hour Rule (Part VII.1), Overtime Pay (Part VIII), Minimum Wage (Part IX), Public Holidays (Part X), and Vacation with Pay (Part XI) provisions of the Act.
"Teacher" is defined in the Teaching Profession Act, RSO 1990, c T.2 ("TPA"):
A person may be employed to teach, but that in itself does not mean that the person falls within the exemption. In the first place, as the definition indicates, the term "teacher" does not include supervisory officers (e.g., directors of education), principals and vice-principals, or instructors in a teacher-training institution.
Secondly, some teachers are not employed by a board as that term is used in the definition. While the term "board" is not defined in O Reg 285/01 or the TPA, the Education Act, R.S.O. 1990, c. E.2., defines it as a "district school board or school authority". Based on the principle of statutory interpretation that holds that words and expressions used in different statutes dealing with the same subject matter should be interpreted consistently and on the fact that the TPA, the Education Act and s. 2(1)(d) of O Reg 285/01 all deal with the teachers, it is the Program's position that the word "board" as it appears in the exemption should be construed as a district school board or school authority (as opposed to, say, a board of directors or board of governors).
It follows that teachers who are not employed by a district school board or school authority, such as teachers in a private school or a college or university, do not fall within the exemption. See, for example, Guru Tegh Bahadur International School Inc. v. Director of Employment Standards, 2019 CanLII 22126 (ON LRB). (Note that teachers in these institutions are not required by legislation to be members of the Ontario College of Teachers, and if they are not they would be outside the scope of the exemption on that ground as well.)
Students in training to be one of the professionals listed in clause (a) or (b), a naturopathic practitioner as mentioned in clause (c), or a teacher as defined in clause (d) are exempt from the Hours of Work and Eating Periods (Part VII), Three Hour Rule (Part VII.1), Overtime Pay (Part VIII), Minimum Wage (Part IX), Public Holidays (Part X), and Vacation with Pay (Part XI) provisions of the Act.
Most of these professions and callings have some type of work experience or apprenticeship requirement that must be completed before a person can qualify to practise the profession. This work experience requirement is often mandated by the authorizing statute. It is only while a student is engaged in obtaining work experience as per the statute that he or she is exempted from the above standards. For example, the Professional Engineers Act requires applicants for a license as a duly qualified practitioner of professional engineering to have certain educational qualifications and 48 months of experience in the practice of engineering. After completing the 48 months of work experience, the Council of the Association of Professional Engineers of Ontario reviews the experience to determine whether it is sufficient to allow the student to meet the generally accepted standards of practical skill required to engage in the practice of professional engineering. Some students in training enroll in the Engineering Intern Training ("EIT") Program. This Program, which is administered by the Professional Engineers of Ontario, provides the student with an annual review of his or her engineering experience (as well as a subscription to certain professional publications). For the purposes of the ESA 2000, a student-in-training would include a student in the EIT Program but would also include a student who is not in the Program but is currently engaged in obtaining the 48 months of experience required under the Professional Engineers Act.
If the student is merely studying the subject area of the profession at university or college, the exemption will not apply to any employment he or she undertakes while studying. For example, a person may be studying dentistry while employed by the operator of a restaurant part-time as a waiter; the exemption will not apply to exempt the restaurant operator from the obligation to comply with the above standards.
Employees engaged in commercial fishing and who fall under provincial jurisdiction will be exempt from the Hours of Work and Eating Periods (Part VII), Three Hour Rule (Part VII.1), Overtime Pay (Part VIII), Minimum Wage (Part IX), Public Holidays (Part X) and Vacation with Pay (Part XI) provisions of the Act. Please refer to ESA Part III, s. 3(2) for further information. Note, however, that this exemption has not been held to apply to "in plant" employees on the basis that employees engaged in preparing and distributing the fish for market were not engaged in commercial fishing - see Kingsville Fishermen's Company Limited v Ontario Ministry of Labour (April 8, 1988), ESC 2324 (Springate).
A registered salesperson of a real estate broker is exempt from the Hours of Work and Eating Periods (Part VII), Three Hour Rule (Part VII.1), Overtime Pay (Part VIII), Minimum Wage (Part IX), Public Holidays (Part X), and Vacation with Pay (Part XI) provisions of the Act.
This exemption was amended effective March 31, 2006 by O Reg 92/06 to reflect the repeal and replacement of the Real Estate Business and Brokers Act, RSO 1990, c R.4 with the Real Estate Business and Brokers Act, 2002, SO 2002, c 30, Sch C which came into force on that date.
In order for the exemption to apply, the salesperson must be registered as a broker under the Real Estate and Business Brokers Act, 2002 and be employed by a brokerage to trade in real estate. He or she must actually be employed as a salesperson. Other types of employees, even if they also happen to be registered as salespersons, would not be exempted, for example, a secretary or an office manager - see Luft and Beaudry Inc. and Broom and Associates Realty Inc. v Bradshaw (September 6, 1991), ESC 2901 (Hovius).
Salespersons (other than route salespersons) who earn, as part or all of their remuneration, commissions for the sale of goods or services where such sales are normally made away from the employer's place of business are exempt from the Hours of Work and Eating Periods (Part VII), Three Hour Rule (Part VII.1), Overtime Pay (Part VIII), Minimum Wage (Part IX), Public Holidays (Part X), and Vacation with Pay (Part XI) provisions of the Act.
The question of what is a route salesperson has frequently been considered by the Ontario Labour Relations Board. In Orlov v Amato, 2003 CanLII 2984 (ON LRB), the Board found that children who were selling boxed chocolates door-to-door on streets determined by the employer were route salespersons and therefore not exempt from the core employment standards under s. 2(h) of O Reg 285/01. The Board cited six cases under the corresponding exemption under the former Act, which was substantially the same as s. 2(h), where a determination was made regarding the exclusion of "route salespersons" from the salesperson exemption. These cases focused on the purpose of the exemption and noted that although the term "route salesperson" was not defined in the Act or regulations, the degree of control exercised by the employee (as opposed to the employer) was a significant factor in determining whether the work in issue was "route" sales but also noted that the issue of whether an employee was a route salesperson could not turn on the matter of control alone.
Another case on the question of what is a route salesperson, Schiller v P & L Corporation Ltd., 2012 CanLII 12611 (ON LRB), concerned an employee selling newspaper subscriptions door-to-door who was picked up by the employer with other employees each day and dropped off in an assigned neighbourhood. She was provided with a list of non-subscribers on particular streets within the neighbourhood to solicit and she could not increase her ability to earn more by working at times or in neighbourhoods other than those assigned to her by the employer. The Board held that she was a route salesperson because sales in this case were conducted on the basis of "routes" which were established and determined by the employer.
In Evangelista v Number 7 Sales Limited, 2008 ONCA 599 (CanLII), the Court of Appeal interpreted s. 2(1)(h)(ii) and considered the meaning of "normally made away from the employer's place of business". The case involved a used car sales manager who was paid on a commission basis and who spent one day each week away from the employer's premises buying and selling used cars at an auction. The Court asserted that the exemption was not intended to deny rights to salespersons who carry out only a small portion of their duties away from the employer's business premises. The Court held that the exemption is "directed at salespersons who normally carry out their duties off-site in the sense that they spend most of their time away from their employer's place of business."
Certain farm employees are exempt from the Hours of Work and Eating Periods (Part VII), Three Hour Rule (Part VII.1), Overtime Pay (Part VIII), Minimum Wage (Part IX), Public Holidays (Part X), and Vacation with Pay (Part XI) provisions of the ESA 2000.
In order for the exemption to apply:
Current Program policy with respect to this exemption incorporates the Divisional Court decision in Rouge River Farms Inc. v. Director of Employment Standards and Ontario Labour Relations Board, 2019 ONSC 3498
The normal, ordinary meaning of “a farm” is a tract of land under cultivation or used for pasture for the growing or raising of agricultural products. However, it is Program policy that the term can also cover other types of facilities used in the primary production of the specified commodities such as greenhouses, insulated buildings containing frame beds for the growing of mushrooms, storage facilities, or industrial buildings used to carry out post-harvest primary production activities (see Rouge River Farms Inc. v. Director of Employment Standards and Ontario Labour Relations Board, 2019 ONSC 3498).
It is the Program's position that there is no requirement that the land or buildings in question be contained on a single tract of land or even on contiguous lots or part lots. So long as all of the tracts of land and/or buildings are worked or managed by the same farmer, they will all be considered to be “a farm”; this is true regardless of the distance between the locations.
For example:
“Employed on a farm” requires that the employment duties relate to the activities surrounding or flowing out of the main enterprise of growing agricultural products or raising animals and that those duties are performed in whole, or at least in part, on the farm in question.
It is the Program's position that “employed on a farm” does not generally necessitate employment with the person that owns or runs the farm. In other words, the employee does not have to be the employee of the farmer to be considered to be employed on a farm. However, “employed on a farm” has been interpreted by the Board as meaning “employed on a single farm” — see 976395 Ontario Inc. v Burry, 2001 CanLII 11999 (ON LRB). In that case, where employees were picked up and transported to catch and carry chickens from the barn to the truck at a number of different farms, the Board concluded that the exemption did not apply because the employees were not employed to provide services to a single farm. As a result, the Program's view is that although the employee does not have to be employed by the farmer, the employee's services must be provided to a single farmer for the employee to be considered to be employed on a farm.
As per the Ontario Labour Relations Board decision in Highline Produce Limited v Flieler, 2009 CanLII 40205 (ON LRB), “directly related” refers to “hands on” work with the specified commodity. However, it is Program policy that “hands on” work does not require the employee to actually touch the specified commodity as part of the employee’s job. “Hands on” in this context means participation in tasks that have a direct impact or direct influence on the primary production of the specified commodity. For example, an employee whose sole responsibility is to ensure the proper temperature and humidity in a greenhouse will be considered to be working “hands on” with the commodity – i.e. will be considered to be in employment that is “directly related” to the primary production - even if this employee does not physically touch the commodity. As another example, an employee who manages or supervises a group of employees whose work is directly related to the primary production of a specified commodity may satisfy the “directly related” requirement on the basis that the manager or supervisor directly influences the primary production of a specified commodity.In light of the Divisional Court decision in Rouge River Farms Inc. v. Director of Employment Standards and Ontario Labour Relations Board, 2019 ONSC 3498, which held that work that is “directly related to primary production” need not occur at the physical location where the growing occurs and that the exemption applied to industrial buildings used to carry out post-harvest primary production activities that were very distant (in some cases, hundreds of kilometres) from the farmer’s land where the commodity was grown, it is no longer Program policy that there be “immediate” hands on work with the commodity for the employment to be considered to be “directly related” to the primary production. As set out in the paragraph above, the “directly related” criterion will be met if the work has a direct impact or direct influence on the primary production of the specified commodity.
Note that the “hands on” / “directly related” requirement means that some work that is carried out on a farm is not captured by this exemption, even if the farm produces one of the specified commodities and even if the work supports the farming enterprise. For example, employees who prepare the meals for other farm employees whose work is directly related to primary production will not be captured by this exemption because the connection between their work and primary production is too remote, i.e. it is indirect.
“Primary production” means any step in the growing or production of the specified commodity prior to a change in the form or state of the ” commodity. This includes harvesting , cooling, sorting, trimming, grading, on-farm storage, on-farm packaging in a raw state, as well as transportation to market of agricultural products that have not been changed in form or state (see below).
“Primary production” ends once employees are engaged in transforming the raw specified commodity into a different form or state (e.g., by pureeing, cooking, brining, canning , drying , or, in the case of specified livestock and other live commodities, slaughter). This “transformation” was described by the Board in the Highline Produce decision as follows: “the processing of a raw vegetable into some other state, such as a liquid or cooked solid would not be part of “‘primary ”production’ nor would the handling of the product in the changed state or form” (Highline Produce Limited v. Flieler, 2009 CanLII 40205 (ON LRB)).
As such, the relevant question in assessing whether a particular activity falls within “primary production” is to ask whether the activity is a step in the growing or production of the specified commodity occurring prior to the raw commodity being transformed in form or state.
Note that there are a number of decisions in which the word “processing” is used to describe this change in form or state, and that earlier versions of the Policy and Interpretation Manual also used the word “processing” to describe the test. The Program now primarily uses the term “transforming” to describe the point at which primary production ends. This change in language is not a substantive change to the Program’s approach in any way. Rather, the term “transforming” is now being used to avoid potential misunderstandings as to what does and what does not fall within “primary production”; i.e. certain “processes” / activities that are part of primary production may be misinterpreted as “processing” the commodity (for example, the hydro-cooling of corn: because hydro-cooling does not change the form or state of the corn, that process is part of primary production). To avoid confusion, the language of “transforming” in form or state is preferred by the Program.
As transforming specified commodities into a different form or state — and steps subsequent to this transformation (e.g., the transportation of the product post-transformation) — are not “directly related to primary production”, employees engaged in such activities do not fall under the exemption in s. 2(2) of O Reg 285/01. See, however, O Reg 285/01, s. 15 which establishes a special overtime threshold for seasonal employees whose employment is directly related to the activities of canning or processing of fresh fruits or vegetables — which constitutes a transformation of the fresh fruit or vegetables. (The special overtime threshold also applies to seasonal employees whose employment is directly related to the non-transforming activities of packing fresh fruit and vegetables, but who are not “employed on a farm”.)
Insofar as storage or transportation of the raw or pre- transformed product is concerned, however, it should be noted that the exemption in s. 2(2) would only apply if the farmer was the employer of the employee in question and it is the farmer's own goods (in their pre-transformed form or state) that are being stored or transported. Thus, if the farmer used a trucking company to take its produce to market, the exemption would not apply to the individuals employed by the trucking company.
It should be noted that some employees employed on a farm to harvest the items listed in s. 2(2) also fall within ss. 24 through 27 of O Reg 285/01. These provisions, which apply to fruit, vegetable, and tobacco harvesters override s. 2(2) to the extent of giving the employees in question an entitlement to minimum wage, coverage under the three hour rule and, if they are employed for 13 weeks or more, vacation and public holiday pay. See ss. 24 to 27 in O Reg 285/01 for further information regarding harvest workers.
In order for this exemption to apply, an employee must be employed on a farm and his or her employment must be directly related to the primary production of one of the following specified commodities:
Only those employees involved in the primary production of the listed commodities are exempted. For example, employees engaged in the production of the following products are not exempted: gladioli bulbs since they are not “seeds”; flowers – see Butt v Six Employees (April 4, 1973), ESC 118 (McNish), but also see ss. 4(3)(a)(ii), 8(e)(ii) and 9(1)(d)(ii) of O Reg 285/01 regarding exemptions for flower growers from the hours of work and eating periods, overtime pay and public holiday provisions of the Act; and peat moss since it is not a "vegetable" – see Thomas Edward Quinn Enterprises Limited v Employees (April 18, 1973), ESC 126 (Armstrong).
It should be noted that although from a strictly scientific standpoint a mushroom is not a vegetable (it is, rather, a fungus), mushrooms have been held to be a vegetable for purposes of the primary production exemption. In Re Ontario Mushroom Co. Ltd. et al. and Learie et al., 1977 CanLII 1117 (ON SC), the Divisional Court held that the word "vegetable", as used in a predecessor to the current exemption, should be interpreted in its ordinary, as opposed to technical sense, and that in its ordinary sense the term "vegetable" would include mushrooms. The Court went on to hold that the exemption applied to persons employed in the growing of mushrooms, despite the more specific — and somewhat less extensive — exemptions (now found in ss. 4(3)(a)(i), 8(e)(i) and 9(1)(d)(i) of O Reg 285/01) that applied specifically to such employees.
In 2008, believing that principles of statutory and regulatory interpretation had evolved since the time of the Re Ontario Mushroom Co. Ltd. et al. and Learie et al. decision to the point where the exemptions specific to mushroom growing would be held impliedly to exclude employees whose employment was directly related to the growing of mushrooms from the broader exemption in s. 2(2), the Program changed its policy and took the position that such employees would not fall within that subsection. Subsequently, however, in Highline Produce Limited v Flieler, the Ontario Labour Relations Board found that the employment of an employee engaged in the packing of mushrooms was "directly related to the primary production of . . .vegetables" and, having so found, held that it was unnecessary to go on to consider whether the employee fell within the exemptions that applied to persons whose employment was directly related to mushroom growing. In light of the Highline Produce Limited v Flieler decision, the Program has reverted to its previous policy; persons whose employment is directly related to the growing of mushrooms, including the packing of mushrooms in their raw state, should thus be considered to fall within s. 2(2).
In order for the exemption in subsection 2(2) to apply, all of the following criteria must be met:
Section 2.1 was added to O. Reg. 285/01 effective January 1, 2019.
There have been several significant changes to “the Crown” exemptions since January 2018. See the table at the end of this section for details of which provisions applied to “the Crown” at which point in time.
This provision exempts the Crown, a Crown agency or authority, board, commission or corporation all of whose members are appointed by the Crown from all provisions of the Act other than those listed in subsection (2).
The term "Crown" refers to the government of Ontario. More precisely, it refers to the executive branch of government, as the term Crown does not include the Legislative Assembly or the judiciary.
The determination of whether an entity is a Crown agency and therefore exempted from every provision of the Act except those listed is 2.1(2) is generally made on the basis of the common law, which looks at the nature and degree of control which the Crown, through its Ministers, exercises over the entity. For example, see Westeel-Rosco Ltd. v Board of Governors of South Saskatchewan Hospital Centre, [1977] 2 SCR 238, 1976 CanLII 185 (SCC).
In some cases, a statute will expressly state that an entity is a Crown agency. See, for example, the Liquor Control Act, R.S.O. 1990, c L.18, which specifically states the Liquor Control Board of Ontario is a Crown agency. In such a case, there is no need to consider the common law test.
The Crown Agency Act, R.S.O. 1990, c C.48, defines "Crown agency" as "a board, commission, railway, public utility, university, manufactory, company or agency, owned, controlled or operated by Her Majesty in right of Ontario, or by the Government of Ontario, or under the authority of the Legislature or the Lieutenant Governor in Council". This definition, if read literally, would make even privately-owned business corporations Crown agencies, given that they usually operate under the authority of an Act of the Legislature, such as the Ontario Business Corporations Act, R.S.O. 1990, c B.16. However, Ontario courts have generally continued to use the control test to determine whether an entity is a Crown agency. See P.W. Hogg, P. J. Monahan & W.K Wright, Liability of the Crown, 4th ed., p. 468, n. 27.
Accordingly, it is Program policy that an entity will be considered to be a Crown agency only if it is controlled by the Crown or if a statute states that the entity or that particular type of entity is a Crown agency. An example of the latter is the Ontario Colleges of Applied Arts and Technology Act, 2002, S.O 2002, c 8, Sch F, which specifically provides that colleges established under that Act are Crown agencies.
It is important to bear in mind that not all public sector employers are Crown employers for the purposes of enforcing the Employment Standards Act, 2000. In fact, the majority are not. Examples of public sector employers who are not considered Crown employers and are therefore subject to all provisions of the Employment Standards Act, 2000 include:
The reference in s. 2.1(1) to an "authority, board, commission or corporation all of whose members are appointed by the Crown" encompasses entities that would not be considered Crown agencies, but whose members are all government appointees. An example would be the Ontario Labour Relations Board.
Pursuant to s. 2.1(2), only the provisions listed in that subsection apply to the Crown, a Crown agency or authority, board, commission or corporation all of whose members are appointed by the Crown.
If a provision of the ESA is not listed it does not apply to the Crown, etc. specifically, these provisions do not apply:
The following table outlines how the Employment Standards Act, 2000 applied at specific points in time to the Crown, a Crown agency or an authority, board, commission or corporation all of whose members are appointed by the Crown and its employees (referred to collectively as “the Crown” in this table).
| Date | Provisions |
|---|---|
| Prior to January 1, 2018 |
The following provisions/Parts applied to the Crown:
(This was set out in ss. 3(4) of the Employment Standards Act, 2000.) |
| January 1, 2018 | Entire ESA applied, except s. 4(2) (the “related employer” provision). (This was pursuant to the Fair Workplaces Better Jobs Act, 2017, which repealed ss. 3(4), added s. 3.1 that states the Act binds the Crown, and added the exception to the “related employer” provision in ss. 4(4.1).) |
| October 24, 2018 | The Crown is exempt from Part VII (Hours of Work and Eating Periods) and Part VIII (Overtime Pay). (This is pursuant to an amendment to O. Reg. 285/01) (The exemption from s. 4(2) of the Act continues.) |
| January 1, 2019 |
The Crown is exempt from every provision of the Act except those listed in section 2.1 of O. Reg. 285/01. Section 2.1 of O. Reg. 285/01 provides that only the following provisions/Parts apply to the Crown:
(This is pursuant to amendments to O. Reg. 285/01 that added s. 2.1 and revoked the provisions that had created the October 2018 Hours of Work and Overtime Pay exemptions.) |
These provisions limit the rights of and create special rules for certain employees with respect to sick leave, family responsibility leave and bereavement leave.
Note that this section was amended effective January 1, 2019. Prior to January 1, 2019, this exemption applied to the below-described classes of professionals in relation to personal emergency leave, which was repealed effective January 1, 2019. As of January 1, 2019, the special rule applies to the same employees in relation to sick leave (s. 50), family responsibility leave (s. 50.0.1) and bereavement leave (s. 50.0.2).
Employees described in s. 3 paragraphs 1 or 2 who, if they exercised the right to sick leave, family responsibility leave or bereavement under ESA Part XIV, s. 50 s. 50.0.1 or s. 50.0.2, would in the circumstances be guilty of professional misconduct or dereliction of duty, are exempt from the right to take any of these leaves in those circumstances. For example, a nurse would be precluded from exercising a right to family responsibility leave if by doing so it would constitute professional misconduct or dereliction of duty because she had left a patient unattended.
The employees subject to this limited exemption are: those described in s. 2(1)(a), (b), (c) and (d) and students in training for those professions, and any registered health practitioners of professions set out in Schedule 1 of the Regulated Health Professions Act, 1991, SO 1991, c 18 not already listed in s. 2(1)(b). The latter professions are:
| Profession | Act |
|---|---|
| Audiology and Speech-Language Pathology | Audiology and Speech-Language Pathology Act, 1991, S.O 1991, c 19 |
| Dental Hygiene | Dental Hygiene Act, 1991, S.O 1991, c 22 |
| Dental Technology | Dental Technology Act, 1991, S.O 1991, c 23 |
| Denturism | Denturism Act, 1991, S.O 1991, c 25 |
| Dietetics | Dietetics Act, 1991, S.O 1991, c 26 |
| Homeopathy | Homeopathy Act, 2007, S.O 2007, c 10, Sched Q |
| Kinesiology | Kinesiology Act, 2007, S.O 2007, c 10, Sched O |
| Medical Laboratory Technology | Medical Laboratory Technology Act, 1991, S.O 1991, c 28 |
| Medical Radiation Technology | Medical Radiation Technology Act, 1991, S.O 1991, c 29 |
| Midwifery | Midwifery Act, 1991, S.O 1991, c 31 |
| Nursing | Nursing Act, 1991, S.O 1991, c 32 |
| Occupational Therapy | Occupational Therapy Act, 1991, S.O 1991, c 33 |
| Opticianry | Opticianry Act, 1991, S.O 1991, c 34 |
| Psychotherapy | Psychotherapy Act, 2007, c 10, Sched R |
| Respiratory Therapy | Respiratory Therapy Act, 1991, S.O 1991, c 39 |
| Traditional Chinese Medicine | Traditional Chinese Medicine Act, 2006, S.O 2006, c 27 |
Section 3.0.1 of O. Reg. 285/01 was revoked effective January 1, 2019. This provision is therefore no longer in force. However, construction employees who work in the construction industry may still have a complaint relating to personal emergency leave pay that arose during the period of time this provision — which established a special rule relating to the now-repealed personal emergency leave pay provision — was in force: from January 1, 2018 to December 31, 2018. For that reason, the Program’s interpretation of this section remains as part of this publication, though the text appears in red to highlight that the provision has been revoked.
This section provides a special rule which may be applicable to construction employees who work in the construction industry: if these employees receive 0.8% or more of the employee’s hourly rate or wages for personal emergency pay, the employees will not be entitled to be paid for the first two personal emergency leave days that they take within a calendar year. However, they will be entitled to take up to 10 unpaid personal emergency leave days in a calendar year if they meet the eligibility requirements of ESA Part XIV, s. 50.
Note that employers of construction employees are not required to follow the special rule, and may instead revert to the basic personal emergency leave entitlements under s. 50, including the requirement to pay employees the wages that they would have earned had they worked during the first two days of personal emergency leave taken in the calendar year.
“Construction employee” and “construction industry” are both defined terms: see O Reg 285/01, s. 1 for more information.
For the personal emergency pay special rule, 0.8 per cent represents approximately two days of wages.
This provision applies only to employers that participate in an Ontario Municipal Employees Retirement System ("OMERS") pension plan under the Ontario Municipal Employees Retirement System Act, 2006, SO 2006, c 2 ("OMERSA"). It makes s. 13 of the Employment Standards Act, 2000, which subject to certain exceptions prohibits deductions from wages, inapplicable to such employers insofar as fees that a by-law made under s. 28 of OMERSA requires an employee to pay. As a result, an employer may deduct from an employee's wages the amount that the by-law requires the employee to pay without obtaining the employee's written authorization.
Section 3.1(2) provides that the s. 3.1(1) exemption applies only if the employer remits the fees in accordance with the by-law. Therefore, if the employer fails to remit the fees in accordance with the by-law, the deduction will not be lawful.
Pursuant to s. 4(1)(a), firefighters, as defined in s. 1 of the Fire Protection and Prevention Act, 1997, SO 1997, c 4 ("FPPA") are exempt from:
Section 19 provides for a limited set of circumstances in which an employer can require an employee to work hours in excess of those set out in s. 17 or to work during a free period under s. 18; since ss. 17 and 18 do not apply to firefighters in the first place, it would make no sense if the regulation did not also make section 19 inapplicable.
Note that firefighters are also exempted from:
Section 1 of the FPPA defines a firefighter as follows:
The exemptions will therefore also apply to fire chiefs and volunteer firefighters. In addition, as the definition makes no distinction between fulltime and part-time firefighters, the exemption will apply to both.
A supervisor or manager who falls within the definition in O Reg 285/01, s. 4(1)(b) is exempt from:
The reason that this category of employee is exempted from s. 19 is because s. 19 provides for a limited set of circumstances in which an employer can require an employee to work hours in excess of those set out in s. 17 or to work during a free period under s. 18; since ss. 17 and 18 do not apply to supervisors or manager in the first place, it would make no sense if the regulation did not also make s.19 inapplicable. Under of O. Reg. 285/01, s. 8(b), such an employee is also exempted from the overtime pay provisions of the ESA 2000.
Work that is "supervisory or managerial in character" generally refers to the supervision of employees rather than the supervision of machines. However, managerial functions can be distinct from supervisory functions. Although supervision of other employees is a primary indication of a managerial employee, this factor is not the only one to be considered. Some employees can be considered managerial even though they do not supervise other employees. Some examples of managerial functions are hiring and firing of employees, responsibility for making substantial purchases, financial control and budgeting, and production planning. Other management functions would include the regular exercise of discretion and independent judgment in management affairs.
Just because a contract of employment or collective agreement states that a person is a manager or supervisor does not mean that the exemption will automatically apply. The actual functions of the person must be assessed. The intention here is that the exemption applies only to the true supervisor who does not regularly or ordinarily perform the same work as the people he or she supervises. The section therefore exempts employees who perform such managerial or supervisory work exclusively, and also those managers and supervisors who perform non-supervisory or non-managerial tasks either on an irregular or exceptional basis.
"Irregular" implies that although the performance of non-supervisory or non-managerial duties is not unusual or unexpected, their performance is unscheduled or sporadic (i.e., does not occur at a regular or set time). For example, if a manager is expected or required to cover staff duties for non-supervisory staff as a result of an unexpected rush of customers, or because a non-supervisory employee has called in sick, these duties may be considered irregular because they are not performed at a scheduled or otherwise regular time. However, if a pattern developed with the result, for example, that a manager was performing staff duties every day during the lunch rush between 11:30 a.m. and 1 p.m., the Program's position would be that the performance of those duties was clearly no longer irregular.
The exemption will not apply even though the employer has not assigned the non-supervisory or non-managerial work, but places the employee in such a position that he or she has no alternative but to regularly perform day-to-day duties of non-supervisory/managerial employees in order to keep the business in operation. An example would be the manager of small shoe store who operates the business by himself or herself on Monday and is provided with part-time help for the rest of the week. This person is performing non-supervisory or non-managerial work on a regular basis. He or she is, each Monday, required to run the entire operation, including arranging displays, assisting customers, etc., in addition to his or her managerial duties.
Finally, whether the performance of non-supervisory or non-managerial duties on a daily basis is irregular may also depend not only on whether or not they are "scheduled", but also the frequency with which such duties are performed and the amount of time spent performing them. Therefore, if a manager spends a significant period of time on each shift performing non-supervisory duties, the performance of such duties could not be said to be irregular, despite the fact that there was no set schedule for their performance. For example, if a manager at a fast food restaurant spends an hour or more of each shift assisting at the cash or in food preparation, these non-supervisory or non-managerial duties may be considered a regular part of his or her duties because they are performed on a "daily basis", even though the hour of non-supervisory work is not scheduled or performed at a set time each day. Similarly, if a manager spent three or four hours of an eight-hour shift performing non-managerial duties once a week, these non-managerial duties may be considered regular duties and the exemption would not apply.
"Exceptional" suggests that non-supervisory or non-managerial duties may be performed so long as they are being performed outside of the ordinary course of the employee's duties. That is, their performance is not in the normal course. For example, if, as a result of a severe snowstorm, the manager were to assist a staff member to clear the snow from the entrance to the employer's establishment (ordinarily the responsibility of the staff member), the performance of this non-supervisory duty could be considered exceptional. Another example is where a manager performs bargaining unit work during a strike or lock-out. Generally, the performance of bargaining unit work due to a strike or lock-out will be seen as an exceptional situation, and the exemption will continue to apply during the strike or lockout. However, there may be situations, such as where the strike or lock-out lasts for more than a few months and the manager is performing non-supervisory and non-managerial duties continually for more than a few months, where the situation is no longer seen as exceptional and the exemption will no longer apply.
Pursuant to s. 4(1)(c), a hunting or fishing guide or a wilderness guide (as defined in s. 1 of O. Reg. 285/01) is exempt from:
Note that since ss. 17 and 18 do not apply to these employees in the first place, it would make no sense if the regulation did not also make s.19 inapplicable.
Note that such employees are also exempted from the overtime pay provisions in ESA Part VIII by O. Reg. 285/01, s. 8(c) and the public holiday provisions in ESA Part X by O. Reg. 285/01, s. 9(1)(b).
Also note that these employees are subject to a special minimum wage — see section 23.1(1) of the ESA for hunting and fishing guides and s. 6 of O. Reg. 285/01 for wilderness guides.
Pursuant to s. 4(1)(d), a construction employee as defined in O. Reg. 285/01, s. 1 is exempt from:
Since ss. 17 and 18 do not apply to construction employees in the first place, it would make no sense if the regulation did not also make s. 19 inapplicable.
Note that they are also exempted from the public holiday provisions in ESA Part X if the employee receives 7.7 per cent or more of their hourly rate of wages for vacation pay or holiday pay — see O. Reg. 285/01, s. 9(2).
Pursuant to s. 4(1)(e), a person employed as a superintendent, janitor or caretaker of a residential building who resides in the building is exempt from:
Since ss. 17 and 18 do not apply to residential building superintendents, janitors and caretakers in the first place, it would not make sense if the regulation did not also make s. 19 inapplicable to these employees.
Note that these employees are also exempted from the application of the three hour rule in ESA Part VII.1, s. 21.2 by O. Reg. 285/01, s. 4.1(d), the minimum wage provisions in ESA Part IX by O. Reg. 285/01, s. 7(d), the overtime pay provisions in ESA Part VIII by O. Reg. 285/01, s. 8(i), and the public holiday provisions in ESA Part X by O. Reg. 285/01, s. 9(1)(h).
The exemption only applies to employees working in residential buildings: apartments, condominiums, etc. Those working in office or manufacturing buildings are not exempted by this provision.
The employee must actually live in the building for which they responsible or in another building in the same complex. If he or she does not do so, they are not exempt.
The exemption does not apply to a person who performs night-time surveillance duties in a building housing people in specialized treatment programs. See Goyette and Goyette v Residence Sainte Marie Inc. (May 9, 1997), ES 97-56 (Novick).
The ESA 2000 does not deal with the rules regarding the tenancy of superintendents, janitors or caretakers. These are dealt with under the Residential Tenancies Act, 2006, S.O 2006, c 17. Employees with concerns regarding their tenancy should be referred to the appropriate area office of the Ministry of Affairs and Housing for further information.
Pursuant to s. 4(1)(f), a person employed as an embalmer or funeral director is exempt from:
Since ss. 17 and 18 do not apply to embalmers and funeral directors, it would not make sense if the regulation did not also make s. 19 inapplicable to these employees.
No person can act as a funeral director or embalmer unless he or she has been properly licensed as a "funeral director" under the Funeral Directors and Establishments Act, R.S.O. 1990, c F.36. Only licensed individuals who are performing funeral and embalming services are exempt. Other employees in the funeral industry, even if they are employed in a funeral home, are not exempt. For example, secretaries, receptionists, hearse drivers, students in training to be a funeral director, and workers at a crematorium or cemetery are not exempt.
Clause 4(1)(g) and subsection 4(1.1) came into effect on March 9, 2018.
Pursuant to s. 4(1)(g), an election official is exempt from:
Since ss. 17 and 18 do not apply to election officials, it would not make sense if the regulation did not also make s. 19 inapplicable to these employees.
Per subsection 4(1.1), the exemption applies only during a period that begins with the issue of a writ for a general election or by-election under the Election Act and ends on the day after polling day.
Note that “election official” is a defined term in s.1 of O. Reg. 285/01.
Some employees who fall within the “election official” definition may also be considered to be “Crown” employees under section 2.1 of O. Reg. 285/01. Where that is the case, section 2.1 and its longer list of exemptions will apply to those employees.
Pursuant to s. 4(2)(a), persons employed as landscape gardeners are exempt from:
Note that employees in this category are not exempt from the application of ESA Part VII, s. 18, but because they are exempt from the application of s. 19, an employer could not require such an employee to work during a rest period to which the employee was entitled under s. 18, despite the existence of exceptional circumstances such as those described in s. 19.
Note that they are also exempted from the overtime pay provisions in ESA Part VIII by O. Reg. 285/01, s.8(i) and the public holiday provisions in ESA Part X by O. Reg. 285/01, s. 9(1)(h).
The Program's view is that a person employed as a landscape gardener is engaged in work that directly involves the modification or maintenance of land for a purpose that is substantially aesthetic (as contrasted with utilitarian). Generally, the exemption will apply to employees engaged in:
The Program considers employees engaged in the following activities to fall outside the definition of a person employed as a landscape gardener:
Employees in many landscaping businesses multi-task; performing a variety of duties, some of which fall within the exemption for a person employed as a landscape gardener and some that do not.
ESA Part VII, s. 22(9) provides that an employee who performs some work that is subject to the 44 hour overtime threshold, and some work that is exempt from the overtime provisions will be entitled to overtime pay after working 44 hours in a week, unless the employee spends the majority of his or her time in that week engaged in activities that are exempt from overtime.
Consequently, an employee who performs work that is covered by the landscape gardener exemption will be exempt from overtime pay for a particular week only if the landscape gardening work represents more than 50% of the time the employee spent working that week.
Example:
John spent 75% of his work week caring for established lawns while the other 25% of his time was spent installing sprinkler systems. The overtime exemption would apply to John because he spent more than 50% of his time in that work week doing "landscape gardener" work. John is therefore not entitled to overtime pay in respect of that week.
ESA Part X. s. 25(2) provides that unless the majority of time spent in any week in which a public holiday falls is work that is exempt under the regulations, the public holiday provisions will apply with respect to that particular public holiday.
Consequently, an employee who performs work that is covered by the landscape gardener exemption will be exempt from the public holiday provisions for a particular public holiday only if the landscape gardening work represents more than 50% of the time the employee spent working during the week with that public holiday.
Example:
During the work week in which Labour Day fell, Afet spent 75% of her time caring for established lawns while the other 25% of her time was spent installing sprinkler systems. The public holiday exemption would apply to Afet with respect to Labour Day because she spent more than 50% of her time in that work week doing "landscape gardener" work. Therefore, the public holiday entitlements with respect to Labour Day do not apply to Afet.
The ESA 2000 does not specify the period of time to be considered when determining whether the hours of work provisions (daily, weekly maximums) apply to employees who do both landscape gardening work and non-landscape gardening work. It is Program policy to consider whether the core, or essential nature of the employee's work is landscape gardening. This may involve application of the majoritarian test; however the period under consideration would generally be considered to be the full period of employment with the employer, provided there has not been a permanent change in the core or essential nature of the employee's job. For example, if an employee has been engaged in a mix of landscape gardening and non-landscape gardening activities over the five year course of their employment, consideration would be given to where the employee spent the majority of his or her time over those five years.
Where the core, or essential nature of an employee's job changes, work performed prior to a permanent change in the nature of the employee's job will not be relevant when making a determination as to whether or not the employee is currently a person employed as a landscape gardener or not.
Example:
If an employee spent five years employed in the office of a landscaping company performing administrative duties and subsequently accepted a permanent position with that company planting trees and hedges in residential gardens, they would be considered to be a person employed as a landscape gardener immediately upon commencing his or her new position because there was a permanent change to the core nature of their job. As a result, the hours of work exemptions would apply immediately.
Pursuant to s. 4(2)(b), a person employed to install and maintain swimming pools is exempt from:
Note, however, that because employees in this category are not excluded from ESA Part VII, s. 18, an employer could not require such an employee to work during a rest period to which the employee was entitled under that section, despite the existence of exceptional circumstances such as those described in s. 19.
Note that they are also exempted from the overtime pay provisions in ESA Part VIII by O. Reg. 285/01, s. 8(i) and the public holiday provisions in ESA Part X by O. Reg. 285/01, s. 9(1)(h).
It is the Program's position that this exemption does not extend to people employed to install and maintain hot tubs, on the basis that exemptions from the rights and benefits afforded under the legislation must be construed narrowly. In King v RNR Patient Transfer Services Inc., 2008 CanLII 22 (ON LRB)the Ontario Labour Relations Board cited the Supreme Court's decision in Rizzo & Rizzo Shoes Limited (Re), [1998] 1 SCR 27at paragraph 36:
In applying this principle in the context of exemptions, the Board said: "A liberal and generous interpretation of the Act requires any regulation, like (s. 8 of O. Reg. 285/01) that limits the application of the Act or exempts certain individuals from receiving the benefits conferred by the Act to be strictly or narrowly construed."
On a plain reading, the terms "swimming pool" and "hot tub" have different meanings and the Program's position in light of the above is that the exemption does not apply to persons employed to install and maintain hot tubs.
A person whose employment is directly related to the activities described in ss. 4(3)(a) (i)-(vi) is exempt from all of the hours of work and eating periods provisions contained in Part VII of the Act. This includes the daily and weekly limits on hours of work in s. 17, the daily, weekly and bi-weekly rest provisions in s. 18, the provisions in s. 19, and the right to an unpaid eating period(s) as set out in ss. 20 and 21 of the Act. Section 19 provides for a limited set of circumstances in which an employer can require an employee to work hours in excess of those set out in s. 17, or to work during a free period under s. 18. Since ss. 17 and 18 do not apply to employees listed in s. 4(3)(a) in the first place, it would make no sense if the regulation did not also make s. 19 inapplicable.
Note that they are also exempted from the overtime pay provisions in ESA Part VIII by O. Reg. 285/01, s. 8(i) and the public holiday provisions in ESA Part X by O. Reg. 285/01, s. 9(1)(h)
The use of the word "directly" in ss. 4(3)(a)(i)-(vi) of O. Reg. 285/01 eliminates, by implication, all persons employed "indirectly" in the employment described in s. 4(1)(a)(i) through (vi) of the regulation. It, therefore, excludes work that merely contributes to making possible or assisting in the ultimate performance of the work described. For example, a person employed on a farm to prepare meals for employees engaged in the breeding and boarding of horses is assisting in the ultimate performance of an element of horse breeding and boarding, but the work of such a person is not directly related to that activity.
As was noted in the discussion of s. 2(2) of O. Reg. 285/01, in accordance with the Ontario Labour Relations Board's decision in Highline Produce Limited v Flieler, 2009 CanLII 40205 (ON LRB)), an employee whose employment is directly related to the growing of mushrooms is an employee "whose employment is directly related to the primary production vegetables" within the meaning of that subsection, and as a result, such an employee would be excluded from the coverage of Parts VII through XI of the Act. This is despite the specific exemptions from Parts VII (Hours of Work and Eating Periods), Part VIII (Overtime) and Part X (Public Holidays), set out, respectively, in ss. 4(3)(a)(i), 8(e)(i) and 9(1)(d)(i) of O. Reg. 285/01. See O. Reg. 285/01, s. 2(2) for a more detailed discussion regarding the application of the exemption to persons whose employment is directly related to the primary production (or growing) of mushrooms.
A person employed in the growing of flowers is exempt from Part VII (Hours of Work and Eating Periods) of the Act.
Note that they are also exempted from the overtime pay provisions in ESA Part VIII by O. Reg. 285/01, s. 8(e)(ii) and the public holiday provisions in ESA Part X by O. Reg. 285/01, s. 9(1)(d)(ii).
In Butt v Six Employees (April 4, 1973), ESC 118 (McNish) the referee concluded that the six employees who had been engaged to plant gladioli in the summer and then called back in the fall to cut the flowers and dig up the corms and pack them in boxes were engaged in the growing of flowers for the wholesale and retail trade. The referee also appears to suggest that if other employees had been engaged solely in the packaging, assembling, order preparation and distribution of the flowers and corms that he would have found those employees to be employed in the growing of flowers. However, the referee noted that in so doing, he was giving the phrase "growing of flowers" a "liberal interpretation", which is contrary to the Program's approach to construe exemptions to the standards narrowly. As a result, Referee McNish's comments regarding employees engaged solely in packaging, assembly and distribution of flowers are not followed by the Program. See more on this approach under the discussion of s. 4(2)(b) above.
A person employed in the growing, transporting and laying of sod is exempt from Part VII (Hours of Work and Eating Periods) of the Act. He or she is also exempt from the overtime pay provisions (see s. 8(e)(iii) of O. Reg. 285/01) and the public holidays provisions (see O. Reg. 285/01, s. 9(1)(d)(iii)).
A person employed in the growing of trees and shrubs is exempt from Part VII (Hours of Work and Eating Periods) of the Act. He or she is also exempt from the overtime pay provisions (see s. 8(e)(iv) of O. Reg. 285/01) and the public holidays provisions (see s. 9(1)(d)(iv) of O. Reg. 285/01).
A person employed in the breeding and boarding of horses is exempt from Part VII (Hours of Work and Eating Periods) of the Act. He or she is also exempt from the overtime pay provisions (see O. Reg. 285/01, s. 8(e)(v)) and the public holidays provisions (see O. Reg. 285/01, s. 9(1)(d)(v)).
In order for this exemption to apply, two preconditions must be met:
The referee in Kenneth Nixon c.o.b. Nixon Stables v. Adams (November 20, 1985), ESC 1989 (Brown) noted that the Random House Dictionary Unabridged Edition (1966) defined "breed" as: "1. to produce (offspring); procreate; engender. 2. to procure by mating; propagate sexually; reproduce", and "breeding" as "the act of one who or that which breeds".
Therefore, in order for this precondition to be met, the employee must be involved in the accommodation and feeding of mares and studhorses, or the production of offspring from the mares. For example, employees who monitor expectant mares in foaling season are exempt - see Carment Di Paola o/a Riviera Racing Stable v Davenport and Skinner (October 29, 1990), ESC 2768 (Betcherman). Employees engaged in the production of horse feed, such as those described in Bert Simon Larch Tree Farm v. Woolnough and Kraley (September 3, 1980), ESC 857 (Adamson) or engaged in grooming and racing horses, such as those described in Nixon Stables v. Adams are not.
Unlike the other exemptions in s. 4(3)(a), the horse-breeding and boarding exemption contains a requirement relating to the location of the work. Only those workers employed "on a farm" are exempt. Persons employed in the breeding and boarding of horses at a racetrack or at a riding stable that is not part of a farm do not fall within the exemption. In order to be on a farm, the operation must be on land that can be cultivated or used as pasture to provide a substantial part of its own feed needs. A large garden plot attached to a riding stable would not qualify as the operation of a farm.
A person employed in the keeping of fur-bearing animals is exempt from Part VII Hours of Work and Eating Periods. They are also exempt from the overtime pay provisions (see O. Reg. 285/01, s. 8(e)(vi)) and the public holidays provisions (see O. Reg. 285/01, s. 9(1)(d)(vi)).
Fur farming is regulated under the Fish and Wildlife Conservation Act, 1997, S.O 1997, c 41 ("FWCA"), which contains the following definition of "fur-bearing mammals":
Schedule 1 of the FWCA lists the following as furbearing mammals: badger, beaver, bobcat, coyote, fisher, gray fox, arctic fox, red fox, lynx, mink, muskrat, marten, opossum, otter, raccoon, striped skunk, red squirrel, least weasel, short-tailed weasel (ermine), long-tailed weasel and wolf.
O. Reg. 669/98 to the FWCA additionally prescribes polar bears and wolverines as furbearing mammals.
4(3) Part VII of the Act does not apply to,
A person employed as an information technology professional as defined in s. 1 of O. Reg. 285/01 is exempt from Part VII Hours of Work and Eating Periods. See O. Reg. 285, s. 1 for further information regarding the definition of information technology professional. Such an employee is also exempt from the overtime pay provisions of the Act — see O. Reg. 285/01, s.8(l)
A person employed in the recorded visual and audio-visual entertainment production industry as defined in s. 1 of O. Reg. 285/01 is exempt from Part VII Hours of Work and Eating Periods.
See O. Reg. 285/01, s. 1 for further information regarding the definition of the industry and those persons employed therein.
Employees who fall within clauses (a) through (c) are exempt from the three hour rule found in Part VII.1, section 21.2 of the ESA 2000.
For details on the meaning of the terms used in this section, see:
Section 4.1, which was added to O Reg 285/01 effective January 1, 2019, was amended to add “unless the person is a wilderness guide” at the end of clauses (a) through (c) effective June 3, 2019, at the same time that a set of exemptions and a special minimum wage for wilderness guides was introduced into the regulation. This means that the exemption from the three hour rule does not apply to employees who are students within the meaning of the first part of clauses (a) through (c) but who also fall within the definition of “wilderness guide” in s. 1 of O. Reg. 285/01. In that case, the employee will be subject to the three hour rule.
Note that since the definition of “wilderness guide” specifically excludes a student under 18 years of age who works 28 hours each week or less or who is employed during a school holiday, such a student cannot be a “wilderness guide” and is therefore exempt from the three hour rule if the student is employed in a charitable recreational program, to instruct/supervise children, or at a camp for children.
However, take the example of a 20-year-old student who is employed at a camp for children. She is employed to teach and guide children on canoe trips in the wilderness. Because she is employed to teach and guide canoeing in a wilderness environment, and because she is over 18 years old, the “wilderness guide” definition applies to her. This means that the exemption from the three hour rule does not apply to her (but the exemptions and special minimum wage rate applicable to wilderness guides will apply).
Students who are not “wilderness guides” are also exempt from the minimum wage provisions — see O. Reg. 285/01, ss. 7(a) 7(b) and 7(c); the overtime pay provisions — see O. Reg. 285/01, ss. 8(h), (f) and (g); and the public holiday provisions — see O. Reg. 285/01, ss. 9(1)(g), (e) and (f). For a full discussion about who falls into these student categories, and about the relevant exemptions, see O. Reg. 285/01, s. 7 under the heading “Students”.
Section 4.1 was added to O. Reg. 285/01 effective January 1, 2019. Pursuant to s. 4.1(d), a person employed as a superintendent, janitor or caretaker of a residential building who resides in the building is exempt from the three hour rule found in Part VII.1, section 21.2 of the Employment Standards Act, 2000.
Please refer to O. Reg. 285/01 s. 4 for a discussion about employees who fall into these categories and for information regarding additional exemptions for these employees.
Until January 1, 2018, subsection 5(1) of O. Reg 285/01 as amended by O. Reg 31/14 had prescribed the minimum wage rates that were required to be paid pursuant to paragraph 1 of ESA Part IX, s. 23(1), effective June 1, 2014. However, from October 1, 2015 onwards, the minimum wage rates were no longer prescribed by regulation. Rather, the minimum wage rates in effect immediately before October 1 in each year were to be adjusted in accordance with the formula set out in ESA Part IX, s. 23.1(4). (The Stronger Workplaces for a Stronger Economy Act, 2014 (“SWSEA”), S.O 2014, c. 10 added s. 23.1 to the ESA 2000.)
The Fair Workplaces Better Jobs Act, 2017 (“FWBJA”) subsequently amended the SWSEA amendment, which directly tied changes in the minimum wage rates from October 1, 2015 on to changes in the Consumer Price Index through a formula in s. 23.1(4). The FWBJA provided for increases to minimum wage rates to the amounts that were set out in s. 23.1(1) effective January 1, 2018 and January 1, 2019. It had also provided that effective October 1, 2019, the minimum wage rates immediately in effect before October 1 each year were to be adjusted annually by the formula set out in s. 23.1(4).
The Making Ontario Open for Business Act, 2018 (MOOBA) then amended s. 23.1(1) to keep the minimum wages at the January 1, 2018 rates and to delay by one year the date that the annual adjustments are to take effect, changing the date from October 1, 2019 to October 1, 2020.
See ESA Part IX, s. 23.1.
Section 5(1) sets the amounts deemed to be paid as wages with respect to meals or rooms (private and non-private).
Note that prior to January 1, 2018 this provision appeared in subsection 5(4). As a consequence of the minimum wage rates being moved from this regulation to the Act itself by the MOOBA, this regulation was amended and the subsections were renumbered.
The amounts deemed to be paid as wages under s. 5(1) are used only for the purpose of ensuring that the applicable minimum wage has been paid where the employer seeks to satisfy its minimum wage obligations in part through the provision of room, board or room and board. See O. Reg. 285/01, s. 19 for a discussion of the corresponding provisions that relate to domestic workers. See O. Reg. 285/01, s. 25 for a discussion of the corresponding provisions that relate to fruit, vegetable and tobacco harvesters.
The ordinary meaning of the words "private" and "not private" is applied when determining which value to use. For example, an employee's bedroom is not private if the only access to a laundry room used by the employer is through it - see Flores v Walker and Bassett Walker (July 8, 1998), 2234-97-ES (ON LRB).
Where the employer seeks to satisfy its minimum wage obligations in part through the provision of room, board or room and board, and accordingly pays the employee minimum wage less the amounts deemed to have been paid as wages for room, board or room and board (as the case may be) as set out above, there is no deduction from wages, and hence no written authorization for deduction is required in relation to the room and board amounts.
In some cases, an employer may wish to make a larger deduction in respect of room and board than the amounts set out above, for example where the employee's wages exceed the minimum wage set out in the ESA 2000. However, that would have to be authorized in writing by the employee.
This provision establishes certain minimum standards of quality for the room the employer provides in order for amounts with respect to that room to be deemed to be paid as wages under s. 5(1). See O. Reg. 285/01, s. 19 for a discussion of the corresponding provisions that relate to domestic workers. See O. Reg. 285/01, s. 25 for a discussion of the corresponding provisions that relate to fruit, vegetable and tobacco harvesters.
Note that prior to January 1, 2018 this provision appeared in subsection 5(5). As a consequence of the minimum wage rates being moved from this regulation to the Act itself by the MOOBA, this regulation was amended and the subsections were renumbered.
First, a room is required to be reasonably furnished. Program policy is that a room is reasonably furnished if it contains a bed, a table, a chair, and a wardrobe or chest of drawers. It must also be reasonably fit for human habitation. The employer must also provide clean bed linen and towels, not necessarily daily, but on a frequent enough basis to maintain the standard of cleanliness. The employee must have reasonable access to toilet and washing facilities. Facilities just across a hall would usually be reasonable; facilities requiring a trip across a field to an outhouse may or may not be, depending, for example, on the location of the place of employment and on the norms in that particular community.
If any of these requirements is not met, the amount set out in s. 5(1) cannot be deemed to be paid as wages in determining whether the minimum wage has been paid.
Section 5(3) provides that the amounts set out in s. 5(1) with respect to room and board cannot be deemed to have been paid unless the room was occupied and the meals were received by the employee. Where the employee has actually received the meals and room, these amounts can be treated as forming part of the wages paid to the employee for the purposes of determining if the minimum wage standard has been met. A written authorization of the employee is not required since the charges, rather than being deductions from wages, form part of the formula for determining the gross wages paid to the employee. These amounts can be deemed to have been paid even though no record of these amounts were shown on the employee's payroll record. See O. Reg. 285/01, s. 19 for a discussion of the corresponding provisions that relate to domestic workers. See O. Reg. 285/01, s. 25 for a discussion of the corresponding provisions that relate to fruit, vegetable and tobacco harvesters.
In Steven Carapiet c.o.b.a. the Fish Tale Lodge v Cayen and Lamothe (February 17, 1986), ESC 2041 (Adamson), Referee Adamson found that amounts could not be deemed to have been paid as wages for the supply of a room for weeks during which the room was not occupied. The parties did not contest the period of occupancy.
There may be some question as to whether meals were in fact provided or a room was in fact occupied. The Program's position is that a room will be considered occupied if the employee lived, slept or stored belongings in the room during the period for which the employer is claiming credit against the minimum wage obligation. For example, although the employee may be away for a specified period (e.g., on vacation), the room will be considered occupied if it is still being used for the storage of the employee's personal belongings while they are absent.
Subsection 5(7) provides for what is commonly referred to as the "three hour rule" which, under certain circumstances, requires three hours' pay at the rate of at least minimum wage, even though the employee has worked less than three hours. Note that employees in the women's coat and suit industry and the women's dress and sportswear industry have special rules that apply instead of s. 5(7) — see O. Reg. 291/01, s. 3.
The circumstances in which s. 5(7) apply are as follows:
It is immaterial whether the hours are worked on a regular work day or on a day on which the employee does not usually work, provided that they were required to present themselves for work that day.
In other words, the three hour rule may also apply when the employee is called in to work on a day that is not a regular workday, if the employee works less than three hours that day.
Note however that if the employee's schedule includes regularly working more than three hours a day and regularly working three hours a day or less, the application of the three hour rule will depend on whether the day is one where the employee would regularly work more than three hours or one where the employee would regularly work three hours or less.
As an example, assume an employer occasionally schedules staff to attend Saturday morning meetings. Assuming that the employees regularly worked 8 hours a day Monday through Friday, the three hour rule would apply to these occasional Saturday staff meetings. However, if the employer was found to regularly schedule the employees for one hour Saturday morning staff meetings, it would be the Program's position that the three hour rule would not apply to those Saturday shifts/meetings. That is because it is the Program's view that s. 5(7) was not intended to prohibit an employer from having a regular shift schedule that incorporates shifts of less than three hours.
As another example, an employer could establish a shift schedule that has the employee working four hour shifts on Mondays, Wednesdays and Fridays and two hour shifts on Tuesdays and Thursdays. The regularly scheduled Tuesday and Thursday shifts would not trigger the application of the three hour because the employee regularly works less than three hours on those days. Note though that if the employee was not provided with at least three hours of work on a Monday, Wednesday or Friday, the rule would apply.
Where the provision does apply, an employee will be entitled to be paid at least three hours at the minimum wage. The provision does not mean the employee must be paid three hours at their regular rate if it is in excess of the minimum wage. In other words, an employee who is called into work but works less than three hours must receive three hours' pay at minimum wage OR their regular wages for the time actually worked, whichever is greater.
Employee:
The same facts as in the first example, but the regular rate is $45.00/hour.
Subsection 5(8) establishes that the three hour rule in s. 5(7) does not apply when certain types of circumstances that are beyond the control of the employer prevent it from providing work to an employee who reports for work.
For this provision to apply, the circumstances described in the section must be responsible for the complete stoppage of an employee's work. If the circumstances only reduce the demand for the employee's services, this provision will not apply and the three hour rule will apply. For example, a severe electrical storm could result in an employer being unable to provide a construction employee with any work and s. 5(8) would therefore apply. The same storm might only reduce the volume of work available for an employee who works in a car wash so that s. 5(8) would therefore not apply.
This section was added to O. Reg. 285/01 effective June 3, 2019. It prescribes wilderness guides as a class of employees for the purposes of ESA Part IX, s. 23.1(2) and prescribes a block rate minimum wage for them (which is the same rate that is set pursuant to s. 23.1(1) for hunting and fishing guides)
Originally, the provision set out a specific rate in subsection (2) that was in place until September 30, 2020. Beginning on October 1, 2020 , the minimum wage applying to this class of employees was adjusted in accordance with ESA Part IX, ss. 23.1(4) – (6).
This provision was amended effective January 1, 2022 to set out specific rates that apply to wilderness guides between January 1, 2022 and September 30, 2022. The rates are $75.00 for less than five consecutive hours in a day, and $150.05 for five or more hour in a day, whether or not the hours are consecutive. From October 1, 2022 onward, the minimum wage rate applying to this class of employee is adjusted in accordance with ESA Part IX, ss. 23.1(4).
For information about the definition of wilderness guide, see O. Reg. 285/01, s.1.
Employees who fall within clauses (a) through (c) are exempt from the minimum wage provisions of the Employment Standards Act, 2000. They are also exempt from the three hour rule — see O. Reg. 285/01, s. 4.1(a)-(c); the overtime pay provisions — see O. Reg. 285/01, ss. 8(h), (f) and (g), and the public holidays provisions — see O. Reg. 285/01, ss. 9(1)(g), (e) and (f).
Such employees may be employed as:
Note, however, that where a student’s age and employment fall within the scope of the “wilderness guide” definition, s. 7 does not apply and the special minimum wage rate for wilderness guides applies.
In order for the exemption in s. 7(a) of the regulation to apply, the employer must be able to show that it is a duly-registered charitable institution by showing its registration number under the federal Income Tax Act, R.S.C. 1985, c 1 (5th Supp). If it is not, the exemption will not apply, even if the employer is operating a recreational program that is virtually identical to one operated by a charitable institution. Also, the student's employment must be directly connected with the recreational program, and not, for example, with another portion of the organization's operation, such as general administration or a social assistance program.
Unlike the exemptions under ss. 7(b) and (c), the recreational program in exemption s. 7(a) need not involve children (that is, persons under 18).
A "student" is a person who is working full or part-time while in full-time attendance at a primary, secondary or post-secondary institution, or who is working during a holiday period but has the intention of returning to fulltime education at the end of that holiday period. Note that for the purposes of this exemption (as well as the exemptions from the overtime pay provisions — see O. Reg. 285/01, ss. 8(h), (f) and (g) — and the public holidays provisions — see O. Reg. 285/01, ss. 9(1)(g), (e) and (f) - the term "student" is not limited to a person less than 18 years of age. This is in contrast to the use of the word "student" for the purposes of the student minimum wage provisions: the student minimum wage applies to a student (not otherwise exempted from the Act pursuant to s. 3(5) of the act and not exempt from the minimum wage provisions under s. 7 of O. Reg. 285/01) who is under the age of 18 years and 1) does not work more than 28 hours per week while attending school or 2), is employed while on school holiday. For more information on the student minimum wage, please see O. Reg. 285/01, s. 5.
The onus is on the employer seeking to apply any of the exemptions in ss. 7(a), (b) or (c) of O. Reg. 285/01 to confirm that the employee is either in attendance at an educational institution or on a holiday period from an institution.
In order for the exemptions in ss. 7(a), (b) or (c) to apply, the core of the student's employment must fall within the scope of work set out in the provision, though a part of his or her functions may fall outside it. For example, if a student spends 60 per cent of his or her time instructing children and the remaining 40 per cent of her time instructing adults, the exemption in s. 7(b) would apply. The test is where and how the employee spends the majority of their working hours.
Only those employees who are "students", as defined above, are exempt. Other employees, even if performing exactly the same work (e.g., instructing or supervising children, etc.), are not exempt.
The phrase “…unless the person is a wilderness guide” at the end of clauses (a) through (c) means that the minimum wage exemption does not apply to employees who are students within the meaning of the first part of clauses (a) through (c) but who also fall within the definition of “wilderness guide” in s. 1 of O. Reg. 285/01. In that case, the employee will be subject to the special minimum wage “block rate” that applies to wilderness guides pursuant to s. 6 of O. Reg. 285/01.
Since the definition of “wilderness guide” specifically excludes a student under 18 years of age who works 28 hours each week or less or who is employed during a school holiday, such a student cannot be a “wilderness guide” and therefore will not be subject to the wilderness guide special minimum wage.
7 Part IX of the Act does not apply to,
A person employed as superintendent, janitor or caretaker of a residential building who resides in the building is exempt from the minimum wage provisions of the Act. Please refer to O. Reg. 285/01, s. 4 for further information regarding additional exemptions for these employees.
Please refer to the following sections for a discussion of the exemptions in s. 8 of O. Reg. 285/01:
An ambulance driver, ambulance driver's helper or a first-aid attendant on an ambulance is exempt from the overtime pay provisions of the Employment Standards Act, 2000.
Compliance with the criteria set out in the definition of ambulance under the Ambulance Act, R.S.O. 1990, c A.19 is not determinative of whether a person is an ambulance driver, ambulance driver's helper or first-aid attendant on an ambulance or whether the conveyance used for the transportation of persons is an ambulance for the purposes of the ESA 2000. See Direct Care Patient Transfer Inc. v Clarke, 2000 CanLII 12519 (ON LRB).
When determining if the exemption applies, it must be established whether the nature of the service and the transportation used is either an ambulance service (i.e., for medical emergencies where the exemption would apply) or a non-ambulance medical transfer service (in which case the exemption would not apply). There are several factors that may assist in making this determination. They include:
For further discussion, see the Ontario Labour Relations Board's decision in King v RNR Patient Transfer Services Inc., 2008 CanLII 22 (ON LRB).
Please refer to the following sections for a discussion of the exemptions from the public holiday provisions of the Employment Standards Act, 2000 set out in O Reg 285/01, s. 9:
A seasonal employee in a hotel, motel, tourist resort, restaurant or tavern who is provided with room and board is exempt from the public holiday provisions of the Act. See O Reg 285/01, s. 1 for a discussion of the definition of "seasonal" as well as "hotel, motel, tourist resort, restaurant or tavern".
Construction employees who work in the construction industry are exempt from the public holiday provisions of the Act if their period of employment is less than five years and they receive 7.7 per cent or more of their hourly rate or wages for vacation pay or holiday pay. If their period of employment is equal to or greater than five years, they are exempt if they receive 9.7 per cent or more of their hourly rate or wages for vacation pay or holiday pay. See O Reg 285/01, s. 1 for the definition of “construction employee” and “construction industry”.
The percentages are based on the Act's four per cent and six per cent vacation pay entitlements plus a percentage calculated on the basis of nine days of public holiday pay per year for an employee who regularly works five days a week.
Section 9.1 of O. Reg. 258/01 was revoked effective January 1, 2019 pursuant to a regulatory amendment. This section is therefore no longer in force.
Section 9.1 set out employees who were exempt from the application of section 42.1 of the ESA, 2000 (the “equal pay for equal work: difference in employment status” provision). Section 42.1 of the ESA, 2000 was repealed effective January 1, 2019 as a result of the Making Ontario Open for Business Act, 2018.
Since employees may still file a complaint relating to section 42.1 that arose during the period of time when that section was in force — from April 1, 2018 to December 31, 2018 — the Program’s interpretation of section 9.1 (establishing the exemptions that applied to s. 42.1 during the relevant period) remains as part of this publication.
Firefighters, as defined in s. 1 of the Fire Protection and Prevention Act, 1997, are exempt from s. 42.1 of the ESA. Section 42.1 prohibits employers from paying employees who perform “equal work” different rates of pay on the basis of a difference in employment status, subject to certain exceptions.
Section 1 of the FPPA defines a firefighter as follows:
The exemption from section 42.1 will therefore also apply to fire chiefs and volunteer firefighters.
Students who are under the age of 18 and who work 28 hours or less per week or who are employed during a school holiday, are exempt from s. 42.1. Section 42.1 prohibits employers from paying employees who perform “equal work” different rates of pay on the basis of a difference in employment status, subject to certain exceptions.
Employees who work in the recorded visual and audio-visual entertainment production industry are exempt from s. 42.1 of the ESA. Section 42.1 prohibits employers from paying employees who perform “equal work” different rates of pay on the basis of a difference in employment status, subject to certain exceptions.
“Recorded visual and audio-visual entertainment production industry” is defined in section 1 of O Reg 285/01 as follows:
Subsection 10(1) creates an exception to the provisions of s. 73 of the Employment Standards Act, 2000. Under s. 73(2), an employee of a retail business establishment may refuse to work on a Sunday. Under the exception established by s. 10(1) of the regulation, an employee who agreed at the time of hire to work on Sundays may not subsequently avail themselves of the right to refuse Sunday work. It is Program policy that this exemption can apply only to employees who were hired on or after September 4, 2001, based on the presumption against retroactive application. Thus, employees hired before September 4, 2001, still have the right to refuse Sunday work and the right not to be punished for refusing. (Also, see discussion of s. 10(2) below.)
Subsection 10(2) provides that s. 10(1), which precludes employees of a retail business establishment from refusing Sunday work where they have agreed to it at the time of hire, does not apply where an employee refuses Sunday work for reasons of religious belief or religious observance. Thus, an employee who was hired on or after September 4, 2001 and who had agreed at the time of hiring to work on Sundays would be able to subsequently refuse to work on Sundays for reasons of religious belief or religious observance.
Section 11 of the Ontario Human Rights Code, RSO 1990, c H.19 (the "Code") deals with constructive discrimination (also known as "adverse effect" discrimination). It reads as follows:
Section 11 of the Human Rights Code addresses rules or practices that, although not among the specific, prohibited grounds of discrimination set out in Part I of the Code, result in unequal treatment of a particular person or group against whom the Code prohibits discrimination. This type of unintentional discrimination is known as "constructive" or "adverse effect" discrimination. In other words, the Code prohibits practices that have a discriminatory effect, even if they are not expressly or intentionally discriminatory. Therefore, if an employer's policy is not to hire any person who refuses to work on Sundays and such employer will make no exception for those whose religious beliefs or observance practices prevent them from working on Sundays, this may violate the Code.
Subsection 10(3) prohibits an employer from making an employee's agreement to work on Sunday a condition of employment if by so doing a violation of s. 11 of the Code would occur.
Section 11 defines the term homemaker. There are three basic elements to the definition, as follows:
There is no definition of "homemaking services" within the Employment Standards Act, 2000. However in a decision under the former Employment Standards Act, Re Service Employees International Union, Local 204 and Community Services to Jewish Elderly o/a Senior Care, an adjudicator considered it appropriate in the circumstances to look at the definition of homemaking services as defined in Reg 634, RRO 1990 made under the Homemakers and Nurses Services Act, RSO 1990, c H.10. This regulation defines homemaking services as meaning housekeeping services including:
It is Program policy that an employee providing such services is providing homemaking services. Services that are not listed in Reg 634 may also be considered to be homemaking services for the purposes of s. 11, such as providing care to an adult or adults.
Note that a homemaker is not a homeworker — see ESA Part I, s. 1 for the definition of homeworker.
If the person is performing the services in a non-private institution, the section will not apply. For example, cleaners in retirement homes are not homemakers
This refers to the situation in which a householder contracts with a business to have an employee of that business come into their house to perform homemaking services. In contrast, a domestic worker, while performing similar duties, is employed by the householder directly.
Refer to O Reg 285/01, s.1 for a discussion of domestic workers.
Section 6 of O Reg 285/01 establishes when work is deemed to be, or not to be, performed (and so establishes the hours for which an employee must normally be paid at least the minimum wage and overtime pay). When such rules are applied to a homemaker, it may turn out that the homemaker has worked more than 12 hours in a day. However, s. 11(2) of the regulation states that despite the fact that a homemaker works or is deemed to have worked more than 12 hours in a day, they are entitled to be paid the minimum wage for only 12 hours. For example, even if they worked 14 hours in a day, they need only be paid for 12 hours.
In other words, a homemaker is entitled to be paid at least the minimum wage for no more than 12 of the hours they work. There is effectively a cap on what the employer must pay, although the employer is not prohibited from paying more.
Homemakers are not exempted from the application of the minimum wage provisions. If a homemaker works 12 hours or fewer, the homemaker must be paid at least minimum wage calculated with reference to the number of hours worked and if the homemaker works more than 12 hours, the homemaker must be paid at least the minimum wage for 12 hours of work. If the employer pays the homemaker as per the preceding sentence, the homemaker will be considered to be paid in accordance with s. 11(2) and the limits on hours of work will not apply, by virtue of s. 11(3).
The general rules regarding hours of work and eating periods in ESA Part VII and overtime pay in ESA Part VIII, as well as the requirement in paragraph 4 of ESA Part VI, s. 15(1) to keep a record of daily and weekly hours, do not apply to homemakers if the employer complies with s. 11(2), i.e., if the employer pays the employee at least the minimum wage for all hours worked in a day to a maximum of 12. If s. 11(2) is not complied with, then both Parts VII and VIII and paragraph 4 of s. 15(1) will apply. The homemaker's hours of work will be subject to the limits set out in Part VII, and they will be entitled to rest and eating periods, overtime pay and the daily and weekly hours record-keeping requirements.
This provision is similar in effect to s. 13.1 of Reg 325 under the former Employment Standards Act.
Section 12 requires that the employer notify the homeworker in writing of the type of work that he or she is being employed to perform and the rate of pay, whether the basis for the rate is hourly, piecework or some other method, and of any completion deadlines.
These special rules concerning the employment of homeworkers are in addition to the special record-keeping requirements for employers of home-workers, which are set out in s. 15(2) of the Employment Standards Act, 2000. A definition of “homeworker” appears in s. 1 of the Act. Please ESA Part VI and ESA Part I for a discussion of the Act’s general record-keeping requirements, and the definition of “homeworker”, respectively.
Section 13 of O Reg 285/01 establishes a higher overtime threshold for employees engaged at the site of road building. Employees engaged at the site of road building in relation to streets, highways or parking lots are entitled to overtime pay for each hour of work in excess of 55 in a "work week". Employees engaged at the site of road building in relation to structures such as bridges, tunnels or retaining walls in connection with streets or highways are entitled to overtime pay for each hour of work in excess of 50 in a "work week".
If an employee in a "work week" is engaged at the site of road building in both types of work - work to which the 55-hour threshold applies and work to which the 50 hour threshold applies, consistent with s. 22(9) - it is Program policy that the employee receives overtime pay, in respect of all work performed in a given "work week", in accordance with the lower overtime threshold if he or she performs work that attracts the lower overtime threshold 50% or more of the time in any given "work week".
The special overtime thresholds in s. 13 apply if the employee is engaged at the site of "road building", whether he or she is engaged in the activity of "road building" or not.
"Road building" is defined in s. 1 of O Reg 285/01 as follows:
"Road building" includes road maintenance activities, such as snow ploughing and sanding, as well as work that is incidental to road building (if performed at the road building site), such as surveying and the repair or servicing of road building equipment.
"Road building" is considered by the Program to include the construction of secondary roads, e.g., logging roads, as well as streetcar tracks. It is also Program policy that railroad construction falls within the definition of "road building" - see Deckert-Dancy & Associates (Eastern) Ltd. v Ontario Ministry of Labour (July 23, 1973), ESC 38 (Fram).
The following activities have been held not to constitute road building:
As indicated above, to be subject to the special overtime thresholds in s. 13, the employee's work must be at the road building site, but it is not necessary that the employee be himself or herself engaged in road building or that the employer be in the road building industry. For example, a flag person employed by a security firm who works at the site of road-building will be subject to the special road building overtime threshold. Note, however, that a flag person is not himself or herself engaged in road building; as a result, the notice of termination and severance pay exemptions that apply to construction employees would not apply to such a flag person.
It should also be noted that the Program takes the position that employees of employers in the crushed stone quarry and sand and gravel industry (other than office workers not employed at the plant site) will be considered to be engaged at the site of road building and subject to the special overtime threshold in s. 13(1) if more than 50% of the output of the employer's plant consists of materials destined for use in road building.
The Program also takes the position that employees of employers in the asphalt paving-mix industry (except office workers not employed at the plant site) will be considered to be engaged at the site of road building and subject to the special overtime threshold in s. 13(1) if the output of the employer's plant is destined for use in the road building industry.
This section of O Reg 285/01 provides that where hours worked are less than the thresholds established in s. 13(1)(a) and s. 13(2)(a), the difference between hours worked in that "work week" and the relevant threshold up to a total of 22 hours, may be added to the threshold in the "work week" immediately following, in order to determine what, if any, overtime pay is payable in the following week.
Assume the employee works the following hours:
If an employee is engaged in road building in relation to streets, highways and parking lots, the 55-hour threshold in s. 13(1)(a) of O Reg 285/01 applies. In the above example, the 48 hours worked during Week 1 are payable at the "regular rate". There is also a carry forward time of seven hours as per s. 13(1)(b) (being the 55-hour threshold less 48 hours actually worked). As a result, in Week 2, overtime will not be triggered until the employee works more than 62 hours (the 55 hours plus the 7 hours carried forward). In Week 2, the 55 hour-threshold plus the 7-hour carry-forward are payable at straight time and only 3 hours are payable at the overtime rate.
The "carry forward" relief provided under s. 13(1)(b) only operates to reduce the overtime pay payable with respect to the following work week, not the previous work week. For example, the 10-hour difference between the 55-hour overtime threshold and the 45 hours worked in Week 3 cannot be "carried back" to Week 2 - they can only be carried forward to Week 4.
Assume the employee works the following hours:
If an employee is engaged in road building in relation to structures such as bridges, tunnels or retaining walls, the 50-hour threshold in s. 13(2)(a) of O Reg 285/01 applies. In the above example, the 48 hours worked during Week 1 are payable at the "regular rate". There is also a carry forward time of two hours as per s. 13(2)(b) (being the 50-hour threshold less 48 hours actually worked). As a result, in Week 2, overtime will not be triggered until the employee works more than 52 hours (the 50 hours plus the two hours carried forward). In Week 2, the 50-hour threshold plus the 2-hour carry forward are payable at straight time and 13 hours are payable at the overtime rate.
The "carry forward" relief provided under s. 13(2)(b) only operates to reduce the overtime pay payable with respect to the following work week, not the previous work week. For example, the 5-hour difference between the 50hour overtime threshold and the 45 hours worked in Week 3 cannot be "carried back" to Week 2 - they can only be carried forward to Week 4.
Only the maximum permissible carry forward of 22 hours can be brought forward to the immediately following calendar week. This is so notwithstanding that there was a discrepancy of more than 22 hours between the actual hours worked and the overtime threshold of 55.
Section 14 of Regulation 285/01 provides for a special threshold of 50 hours for an employee who meets all of the following criteria:
Each criterion is discussed below.
Hotel, motel, tourist resort, restaurant and tavern are defined in s. 1 of O Reg 285/01 as follows:
Where an employee (who works for the owner or operator of a hotel, motel, etc., and is provided with room and board) is hired with the intention that the employee's employment will not exceed 24 weeks, but in fact the employee does work more than 24 weeks, he or she does not fall under this provision. If he or she had been paid an overtime premium based on this section’s threshold, he or she must in fact be paid retroactively the balance owing, based on the overtime premium due after 44 hours worked in a "work week".
For a discussion as to whether an employee is considered to have been provided with room and board, refer to O Reg 285/01, s. 5.
Section 15 provides a special overtime threshold of 50 hours for employees who meet the criteria set out in the section. The criteria are:
In addition, note that employees who are employed on a farm and whose employment is directly related to the packing of fresh fruit or vegetables or their distribution by the packer may — depending on the circumstances — be subject to the “primary production” exemptions (including from the overtime pay standard) pursuant to s. 2(2) of O Reg 285/01 rather than to the special overtime threshold set out in s. 15. See the heading Interplay Between s. 15 and s. 2(2) of O. Reg. 285/01 below for a discussion of this issue.
Seasonal employee is defined in s. 1 of O Reg 285/01 as follows:
The weeks of employment in the calendar year need not be consecutive for the purposes of this section.
Where an employee (whose employment is directly related to the canning, processing and packing of fresh fruits or vegetables or their distribution by the canner, processor or packer) is hired with the intention that the employment will not exceed 16 weeks in a calendar year, but in fact does work more than 16 weeks, the employee does not fall under this section. If the employee had been paid an overtime premium during the first 16 weeks of employment in a calendar year based on this subsection's threshold, the employee must be paid retroactively the balance owing, based on the overtime premium due after 44 hours worked in a work week.
The employee's employment must be directly related to the canning, processing or packing of fresh fruits or vegetables, or their distribution by the canner, processor, or packer.
It is not necessary that the employer be in the industry for the special overtime threshold in s. 15 to apply. Thus, a temporary help agency that provides assignment employees to a processing plant could pay the overtime premium after 50 hours (as opposed to after 44) in a work week, as long as the assignment employees’ employment was directly related to the canning, processing, packing or distribution of fresh fruit or vegetables.
Note, however, that when it comes to the “distribution” of the canned, processed or packed fresh fruit or vegetables, the special overtime threshold in s. 15 will not apply to employees of a trucking company that has been engaged by the canner, processor or packer to distribute the product. This is because s. 15 applies if the distribution is “by” the canner, processor, or packer. In this case, the special overtime thresholds for local cartage or highway transport may apply to the employees engaged in the distribution – see ss. 17 and 18 of O. Reg. 285/01 for details.)
The general overtime threshold will be applicable to a re-processing of the fruits or vegetables. For example, where fresh strawberries are frozen and then re-processed to make jam, the special overtime threshold (i.e., 50 hours) applies to the initial processing (freezing) and the general overtime threshold (i.e., 44 hours) will apply to the re-processing (making jam).
Where employees are engaged in the packing of fresh fruits and vegetables and the distribution/transportation of these fresh commodities, questions may arise as to the interplay between this provision and the “primary production” exemption found in subsection 2(2) of O Reg 285. This is because the packing of fresh fruits and vegetables and the transport of these commodities are “pre-transformation” activities, such that the work meets the “primary production” criterion under ss. 2(2).
(Note that this same question does not arise in respect of employees engaged in “canning” and “processing” fresh fruits and vegetables and in the transport of these processed/canned commodities by the canner or processor since these are “post-transformation” activities and, as such, do not meet the “primary production” criterion of ss. 2(2)).
Whether or not an employee engaged in the packing or distribution of fresh fruit or vegetables falls under the ss. 2(2) exemption depends on whether the employee is employed “on a farm”. What is “a farm” for the purposes of the ss. 2(2) exemption was established by the Ontario Superior Court in the Rouge River decision (Rouge River Farms Inc. v. Director of Employment Standards and Ontario Labour Relations Board, 2019 ONSC 3498); a farm may include, for example, industrial buildings used to carry out post-harvest production activities so long as the tracts of land where the produce was grown and the industrial buildings where the produce is packaged are worked or managed by the same farmer. Please see here for a detailed discussion of the ss. 2(2) exemption.
Where the exemption in ss. 2(2) applies to an employee, the employee is exempt from the overtime standard and therefore s. 15 does not apply. If an employee does not fall within ss. 2(2) (e.g. because the employee is not employed on “a farm”) but does fall within s. 15, the employee is subject to the special overtime threshold of 50 hours per week. The following example helps to illustrate this distinction.
Seasonal employee A works in an industrial facility shucking corn and packing fresh corn cobs onto styrofoam trays. Depending on the circumstances, this activity could fall under ss. 2(2) or under s. 15.
If the packing facility is a “farm” because it is owned and/or managed by the same farmer on whose land the corn was grown, the exemption in s. 2(2) would apply to seasonal employee A. That is because this employee would meet ss. 2(2) criteria:
As such, this employee would be exempt from the overtime standard (and subject to other exemptions pursuant to ss. 2(2)).
If the packing facility is not owned and/or managed by the farmer (in other words the facility is not part of an enterprise involved in producing the corn) — e.g. the packing facility is owned by “Veggie Packers Inc.” — then the employee would not be “employed on a farm”. As such, the exemption in ss. 2(2) would not apply. This is the case even if all of the vegetables that “Veggie Packers Inc.” packs are from a single farmer. Given that the employee in this example is a seasonal employee whose work is directly related to the packaging of fresh vegetables, section 15 would apply and this employee would be subject to an overtime threshold of 50 hours.
Section 16 of O Reg 285/01 provides for a special overtime threshold of 50 hours for employees involved in:
The critical requirement for this threshold to apply relates to the type of work that the employee is performing. It is not essential that the employer be in the sewer and watermain construction industry. For example, this section would still cover a security guard or driver employed in this work, notwithstanding that his or her employer is a security firm or temporary help agency.
Sewers and watermains are those conduits installed for the movement of sewage or water and are typically found in publicly owned places or in easements. It is Program policy that:
On this last point, see 1496161 Ontario Inc. (Todd Grier Excavating) v Ontario (Employment Standards), 2009 CanLII 33900 (ON LRB), where the Ontario Labour Relations Board held that a septic system is not a "sewer" because the defining characteristic of the term "sewer" is that it is a conduit or channel for the movement of waste, while the core of a septic system is the septic tank — a holding tank that is neither a channel nor a conduit for the movement of waste. The Board also noted that "sewers" exist as part of an intricately connected system to move waste from various sources, as contrasted with a septic system’s self-contained, on-site nature. The Board also observed that even if there was ambiguity about whether septic systems are captured by the word "sewers", the Board, in accordance with Machtinger v HOJ Industries Ltd., [1992] 1 SCR 986, 1992 CanLII 102 (SCC) and Re Blais is to construe an exemption’s applicability narrowly, and to prefer an interpretation that extends the protections of the Employment Standards Act, 2000 over an interpretation that does not.
Section 17(1) of O Reg 285/01 creates a special overtime threshold of 50 hours in a work week if the following criteria are met:
Each criterion is discussed below.
This threshold only applies to the driver or driver's helper, not to someone simply employed to maintain the vehicle.
If a person was employed to drive the vehicle, but also did some maintenance work as part of his or her duties, s. 17 would still be operative as long as that work was merely incidental to his or her employment as a driver. However, if he or she spent the majority of his or her working hours maintaining one or more vehicles, s. 22(1) of the Employment Standards Act, 2000 and the 44-hour threshold would then apply.
If the vehicle is carrying the employer's own goods, the general threshold of 44 hours, as opposed to the local cartage threshold of 50 hours, will apply.
The carrying of goods for hire includes waste cartage and disposal, septic tank contents cartage and disposal, and courier services (including bicycle and other vehicle courier services).
The vehicle must not carry goods for hire further than five kilometers beyond the municipality’s limit.
If a vehicle is at any time carrying goods for hire more than five kilometres beyond the municipality, it would have been required to be licensed under the former Truck Transportation Act, (TTA) RSO 1990, c T.22 and would consequently be subject to the special overtime threshold set out in s. 18 of O Reg 285/01.
It is Program policy that the smallest area of municipal organization will constitute the “municipality” for the purposes of section 17. This is relevant in situations where, for example, there is an “upper tier” municipality (for example, the Regional Municipality of Peel) and a “lower tier” municipality within the “upper tier” municipality (for example, the City of Brampton). In this example, the City of Brampton would be treated as the municipality for the purposes of section 17. (Note this interpretation is consistent with interpretation of “local municipality” that was applied in practice under the former TTA and that consequently informs the special rule set out in s. 18 of this regulation.)
Section 18(1) creates a special overtime threshold of 60 hours for employees described in s. 18(2). Generally, the 60-hour threshold applies with respect to truck drivers who are engaged in hauling goods on a "for-hire" basis. Such employees must be paid at least one and one-half times their regular rate of pay for all hours in excess of 60 per week.
Prior to January 1, 2006, the 60-hour threshold in s. 18 generally applied to employees who were drivers of public trucks operated by holders of operating licenses issued under the former Truck Transportation Act, RSO 1990, c T.22 ("TTA"), which was repealed effective January 1, 2006. Section 18 of O Reg 285/01 was therefore replaced with a new s. 18 (filed February 6, 2006) that reflected the repeal of the TTA, but the scope of the new s. 18 is intended as much as possible to be the same as the scope of its predecessor.
Note that pursuant to subsection 18(5), s. 18(1) does not apply to an employee to whom s. 17 of O Reg 285/01 applies.
Under s. 18(2), the 60-hour threshold applies to an employee who is a driver of any of the three following categories of trucks:
The 60-hour threshold in s. 18(1) will apply if the operator held an operating license under the former TTA on December 31, 2005.
This paragraph provides that, subject to s. 18(3), if an operator held a certificate of intercorporate exemption (CIE) footnote 8 under the TTA on December 31, 2005, the 60-hour threshold applies if, after that date, the operator carried goods for compensation for a person other than an affiliated corporation, such that the operator would be required to hold an operating license if the former TTA were still in force. In other words, if the operator now hauls goods on behalf of anyone other than its corporate affiliates and "would have been required to hold an operating license" under the former TTA the 60-hour threshold will apply, subject to s. 18(3) — see the discussion below.
Subject to s. 18(4), if the operator held neither an operating license nor a certificate of intercorporate exemption on December 31, 2005, the 60-hour threshold applies if the operator would be required to hold an operating license under the former TTA, if it were still in force. See the discussion of s. 18(4) below.
18(2) Subsection (1) applies to an employee who is the driver of any of the following:
These provisions set out exemptions to licensing under the former TTA that apply in considering whether an operator would be required to hold an operating license under the former TTA if it were still in force.
When determining whether an operator "would be required to hold an operating license" under the former TTA, if it were still in force, as required under para. 2 of s. 18(2) and subpara. 3 ii of s. 18(2), consideration must be given to the classes of goods being hauled.
Although the former TTA required an "operating license" in most cases where goods were carried on a "for-hire" basis, a license was not required if, for example, the operator was hauling the following classes of goods (see s. 3(4) of the former TTA):
Section 18 does not apply to an operator described in paragraphs 2 or 3 of s. 18(2) if the operator exclusively hauls any or all of the goods listed above. However, if the operator also hauls non-excluded classes of goods, the 60-hour overtime threshold will apply.
Subsection 18(3) provides that for the purposes of para 2. of ss. 18(2), 3(6) of the former TTA does not apply. Under that section, operators holding a trip permit footnote 10 were not required to hold an operating license under the former TTA. As a result, when determining whether the operator would be required to hold an operating license under the former TTA in accordance with para. 2 of s. 18(2), the fact that the operator may or may not have been eligible for a trip permit under the former TTA is not a relevant consideration.
Subsection 18(4) provides that for the purposes of determining whether subparagraph 3 ii of s. 18(2) applies, neither s. 3(5) nor s. 3(6) of the former TTA apply. In other words, whether or not the operator would have otherwise been eligible to hold a certificate of intercorporate exemption or a trip permit is irrelevant to the determination of whether the operator would be required to hold an operating license under the former TTA, if it were still in force, and consequently, whether the 60-hour threshold applies.
Subsection 18(5) provides that s. 18(1) does not apply to an employee to whom s. 17 of O Reg 285/01 applies. Section 17 establishes a special overtime threshold of 50 hours for certain employees engaged in "local cartage".
Subsection 18(6) provides that in computing the total number of hours worked for the purpose of the overtime provisions only those hours during which the employee is directly responsible for the vehicle shall be included. The driver is not considered directly responsible for the vehicle during times when he or she is free to leave the vehicle (regardless of whether he or she actually leaves it or not), such as meal periods, sleeping periods, and during extended waits for the loading or unloading of the vehicle, if it can be parked and left in the interim.
By contrast, there are times during which the driver must remain with the vehicle, for example, to move it up in a loading or unloading line, a truck inspection line, at a customs or ferry line, or to supervise or observe loading or unloading of the vehicle. In these situations, the driver is considered to be directly responsible for the vehicle and those hours will be included in the calculations for entitlement to overtime pay.
Subsection 18(7) states that "commercial motor vehicle" has the same meaning as it did under the former TTA, which was as follows:
Subsection 18(7) states that "former Act" means the TTA (repealed).
Subsection 18(7) states that "operate" has the same meaning as it had under the former TTA and that operator has a corresponding meaning.
The former TTA defined "operate" as follows:
"Operate" does not refer to the driving of a vehicle, but to the ultimate control of the vehicle. The operator will often be the employer, but this will not necessarily be the case in every instance.
Subsection (7) defines "truck" as follows:
The wage statement requirements set out in s. 12 of the Employment Standards Act, 2000 apply to domestic workers. However, s. 19(1) of the regulation requires that an employer of a domestic worker also provide the employee with information respecting the regular hours of work, including starting and finishing times, and the hourly rate of pay. This information must be provided in writing. For a discussion of the definition of "domestic worker", please see O Reg 285/01, s.1.
This subsection sets the amounts that are deemed to have been paid as wages where meals or a room are provided to the domestic worker for purposes of determining whether the minimum wage has been paid.
With respect to the provision of a room, the ordinary meaning of the words "private" and "not private" is to be applied when determining which amount to use. For example, a domestic worker’s bedroom is not private if the only access to a laundry room used by the employer is through it - see Flores v Walker and Bassett Walker (July 8, 1998), 2234-97-ES (ON LRB).
Where the employer seeks to satisfy its minimum wage obligations in part through the provision of room and/or board, and accordingly pays the domestic worker minimum wage less the amounts deemed to have been paid as wages for room and/or board (as the case may be) as set out above, there is no deduction from wages, and hence no written authorization for deduction is required in relation to the room and board amounts.
In some cases, an employer may wish to make a larger deduction in respect of room and board than the amounts set out above (for example, where the domestic worker's wages exceed the minimum wage set out in the Act). However, that would have to be authorized in writing by the domestic worker.
This subsection mirrors ss. 5(5) (which applies generally to employees) and 25(8) (which applies to fruit, vegetable and tobacco harvesters) of O Reg 285/01.
Subsection 19(4) provides that an amount for room or board shall not be deemed to have been paid to a domestic worker unless he or she has occupied the room and received the meals. This subsection mirrors ss. 5(6) (which applies generally to employees) and 25(9) (which applies to fruit, vegetable and tobacco harvesters) of O Reg 285/01.
This section defines "day" for the purposes of s. 20: the 24-hour period from 12 midnight to 12 midnight. An employer may use some other period for its own purposes, such as scheduling (for example, 8:00 a.m. to 8:00 p.m., 10:00 a.m. to 10:00 p.m., etc.). However, the employer's definition of day does not, for purposes of s. 20 of the regulation, override the definition set out in s. 20.
This section sets out the basic rule for paying residential care workers. Despite s. 6 (which stipulates when work is deemed to be performed), and subject to s. 20(3), an employer must pay a residential care worker for each day an amount equal to the worker's regular rate multiplied by 12 hours. This regular rate cannot be less than the general minimum wage. Even if the employee has worked more than 12 hours in that day, this section would not require the employer to pay the employee for more than twelve hours. But see the discussion of s. 20(4) of O Reg 285/01 below.
This provision is similar in effect to s. 3(2) under Reg 326 to the former Employment Standards Act.
An employee may be allowed by his or her employer to be free from duties in the facility for part of the day even though during that time he or she is still required to be in the facility. As a result, he or she may end up working fewer than 12 hours in a day. If that is the case, he or she need only be paid at his or her regular rate for the actual hours worked.
Reading ss. 20(2) and (3) together, therefore, for each day, a residential care worker is entitled to be paid for the actual hours worked or for 12 hours, whichever is less. In determining what are hours of work, reference should be made to s. 22 of the regulation.
This provision is similar in effect to s. 4 of O Reg 326 under the former Employment Standards Act.
Sections 20(2) and (3) establish the basic rule that the most a residential care worker is entitled to be paid at his or her regular rate is for the actual hours worked, or for 12 hours, whichever is less. However, s. 20(4) creates an exception to this basic rule: if the residential care worker works more than twelve hours in a day, he or she must be paid for those additional hours, but only up to a maximum of three hours, and only if he or she keeps an accurate daily record of hours worked and provides the record to the employer on or before the pay day following the pay day for the pay period in which the extra hours were worked. If the employee fails to provide the record to the employer within the prescribed time limits, the employer could refuse to pay for the extra hours, even if the worker has maintained accurate records on a daily basis.
This provision is similar in effect to s. 6(1) of Reg 326 under the former Employment Standards Act.
A residential care worker is entitled to at least 36 hours off in each "work week", which is defined in s. 1 of the Employment Standards Act, 2000. The worker must be completely free from any requirement to perform any duties during this time. The 36 hours can be given in one consecutive period or, if arranged with the worker, they can be divided into any number of periods of any length so long as they total 36 hours. If the worker does not consent to such an arrangement, the 36 hours must be consecutive. Note that the requirement in s. 1(3) of the Act that "agreements" be in writing does not apply to this section, since this section uses the words "arrangement" and "consent".
21(2) If the residential care worker consents, at the employer's request, to do work during a free hour mentioned in subsection (1),
This provision is similar in effect to ss. 6(2) and (3) under Reg 326 to the former Employment Standards Act.
An employer may request a worker to perform duties during one of the 36-hour periods of time-off mentioned in s. 21(1). A worker is not obliged to comply with this request. However, if the worker does consent to work, he or she does not lose the free time: under subclause (a), it is added to any one of the 36-hour free periods in the next eight work weeks. The decision as to which of those eight periods will be extended is made by the employer. In the alternative, under subclause (b), the employee may be paid a premium rate of at least one and one-half times his or her regular rate, for the time spent working during a free hour. Note that the requirement in s. 1(3) of the Act that "agreements" be in writing does not apply to this section, since this section uses the word "consents".
This provision is similar in effect to s. 7 under Reg 326 to the former Employment Standards Act.
As a residential care worker actually resides at his or her place of employment, it may be unclear when he or she is working. This section defines when work is not deemed to be performed in the specific context of residential care workers, and provides that these rules apply despite s. 6 of this regulation, which set out general rules for when work is not deemed to be performed.
First, when the worker is resting, sleeping or eating, or attending to private affairs or pursuits, he or she is not deemed to be at work even if he or she is "on call" and can be called away at any time to perform duties. (There is no requirement that time falling into this category be the subject of a written agreement.)
Secondly, if the worker is on a break period free from any duties at the facility by agreement with the employer, he or she is not deemed to be at work, even if he or she remains at the facility. There must be written agreement between the worker and his or her employer as to when such break periods are to be taken — see ESA Part I, s. 1(3) and s. 1(3.1) for more information on written agreements.
This provision is similar in effect to s. 8 under Reg 326 to the former Employment Standards Act.
This section provides that the hours of work and eating periods and overtime pay provisions of the Employment Standards Act, 2000 do not apply to residential care workers. Also, the requirement in paragraph 4 of s. 15(1) of the Act for an employer to keep a record of the number of hours worked by an employee in each day and week does not apply to a residential care worker. However, the employer is still required to maintain the other information about the worker set out in s. 15(1) of the Act.
The effect of s. 24 is to bring the employees described in this section back in for entitlements to minimum wage, the three hour rule, vacation or vacation pay and public holiday pay, even though they may fall under the “primary production” exemptions from those standards set out in s 2(2).
This provision was amended effective January 1, 2019 to include a reference to section 25.1, which provides for coverage under Part VII.1 of the Act — the three hour rule.
Section 24 only applies to those employees who meet all the requirements of this section:
The normal, ordinary meaning of "farm" is a tract of land under cultivation or used as pasture for the growing of agricultural products and for the raising of animals. However, the term can also cover other types of facilities used in the growing or raising of agricultural products, e.g. greenhouses or the insulated buildings containing frame beds for the growing of mushrooms. In order that a person be "employed on a farm" within the meaning of section 24, it is necessary that his or her employment duties relate to the activities surrounding and flowing out of the main enterprise of growing agricultural products and that those duties are performed in whole or at least in part on the farm in question.
Only harvesters are covered by ss. 25 through 27, and only certain harvesters, that is, those who pick fruit, vegetables or tobacco leaves. This section of the regulation does not apply to other farm workers (although other provisions in the regulation may apply; see ss. 8(e), 9(d) and 15 of O Reg 285/01).
The provisions of ss. 25 through 27 will apply if the farm is sending its products for wholesale or retail sale, or selling the products directly to the public itself. They will also apply if the products are not sold immediately, but are kept in storage (either on or off the farm). If the products are not being sold "whole", but are being sold to be processed (into jams, fruit juices, etc.) or to be canned or frozen, or (in the case of tobacco) to be made into cigarettes, these provisions will still apply, as the farm is "marketing" its products to such manufacturers.
It is possible that an employee may perform work that is covered by these sections, work that is covered by the farming exemptions in ss. 8(e) or 9(d) of O Reg 285/01, and work that is not exempt at all: for example, harvesting fruit, pruning trees and working in a store, respectively.
In such a case, ss. 25 to 27 will apply to the employee in a given week if the majority of his or her time in that week is spent harvesting.
This section provides that fruit, vegetable and tobacco harvesters are entitled to be paid at least the minimum wage. In this regard, careful note should be made of the special provisions relating to minimum wage and piece work rates that apply to harvesters as set out in s. 25(2).
These sections will apply where the employer does not calculate the wages based on hours worked, but rather pays a piece rate as defined in s. 25(4), that is, a certain amount of money for each unit of work performed (for example, $X for each basket of apples picked).
The rate must be one that is generally recognized in the area in which the farm is located. There is no hard and fast rule defining what is meant by "area". An employment standards officer should consider the area generally considered by the industry as the local farming community.
The rate must be set so that an employee using reasonable effort, if paid such a rate, would earn at least the general minimum wage for the actual hours worked. Thus, a poor or less diligent worker might end up earning less than the minimum wage for hours worked; however, as long as the piece work rate is appropriate, in the sense that an employee using reasonable effort could have earned at least the minimum wage at that rate, the employer will have complied with the Employment Standards Act, 2000. In order to determine whether the rate is appropriate, an officer should consult with local industry representatives and neighbouring farmers, and if need be, observe a number of harvesters performing the same work under similar conditions. The proper comparison is "an employee exercising reasonable effort". The hypothetical employee exercising reasonable effort is an ordinary or typical employee, as opposed to a highly experienced or unusually productive employee.
It is important to note that, by virtue of s. 25(3), this provision only applies to workers who are entitled to receive the general minimum wage. It does not apply to a student under 18 years of age who works not more than 28 hours/week or who works during a school holiday. This does not mean that such a student cannot be paid a piece work rate. However, if the student is paid a piece work rate, the total wages received must equal at least the student minimum wage for the total hours worked, regardless of whether an employee using reasonable effort paid at the same piece work rate could have earned at least the student minimum wage. If there is a shortfall, the employer must make up the difference.
This section sets the amount deemed to have been paid as wages where room or board is provided for the purposes of determining whether the applicable minimum wage has been paid. The employer must pay in monetary form the applicable minimum wage less the value of the above-noted maximum allowances.
The requirements of this definition are fairly self-evident: either a dwelling with a kitchen, private bathroom and at least two bedrooms, or one with a kitchen, private bathroom, and at least one bedroom and a living room. It must be "reasonably fit for human habitation". No hard and fast rules can be established to define this concept; an officer should determine what a reasonable person would consider fit considering factors such as the location of the farm. If the s. 25(6) requirements are not met, an employer who provides unserviced housing accommodation will not be deemed to have paid the amount set out in paragraph 2 of s. 25(5) for purposes of determining whether the employee has been paid at least the minimum wage.
This subsection sets out two requirements that must be met if an employer wishes to be deemed to have paid the amount for "serviced housing accommodation" (i.e., the amount set out in paragraph 1 of s. 25(5)) for minimum wage purposes. In accordance with s. 25(7)(a), the employer must provide accommodation that meets the requirements for "housing accommodation" as set out in s. 25(6). In addition, the employer must comply with s. 25(7)(b) by paying for the provision of any one or more of the following: light, heat, fuel, water, gas or electricity. Note: As long as the employer pays for at least one of these services, the requirement under s. 25(7)(b) will be met, even if the employee is required to pay for the remaining services.
This provision mirrors s. 5(2) of O Reg 285/01 which applies to employees generally and s. 19(3) of O Reg 285/01 which applies to domestic workers; it places conditions which must be met if the employer who provides a room wishes to be deemed to have paid the amount indicated in s. 25(5) for a room for minimum wage purposes.
First, the room must be reasonably furnished; in the view of the Program, that means it must contain at least a bed, a table, a chair, and a wardrobe or chest of drawers. It must also be reasonably fit for human habitation. Further, the employer must provide clean bed linen and towels (not necessarily daily, but on a frequent enough basis to maintain cleanliness), and the employee must have reasonable access to toilet and washing facilities. Again, an officer should determine what a reasonable person would consider reasonable. Facilities just across a hall would usually be reasonable; facilities requiring a trip across a field to an outhouse may or may not, depending, for example, on the location of the farm and the norms in that particular community.
Section 25(9) provides that amounts in respect of room and board are not deemed to have been paid unless the employee has received the meals or occupied the room. This section mirrors s. 5(3) of O Reg 285/01 (which applies generally) and s. 19(4) of O Reg 285/01 (which applies to domestic workers). For purposes of s. 25(9), "room" includes housing accommodation that is not a room (at least in the ordinary sense), e.g., a barracks.
Section 25.1 was added to O. Reg. 285/01 effective January 1, 2019. This section, read in conjunction with section 24, provides that the three hour rule set out in Part VII.1, section 21.2 of the Act applies to employees who are employed on a farm to harvest fruit, vegetables or tobacco for marketing or storage.
For more information, please see the discussion at O. Reg, 285/01 Section 24 and ESA Part VII.1, section 21.2.
A harvester is only entitled to a vacation with pay after he or she has been employed for 13 weeks or more as a harvester, by the same employer. The weeks of employment need not be consecutive, but they must have been for a single employer. Once this condition is met, the employer must comply with Part XI of the Employment Standards Act, 2000 (Vacation With Pay) and either provide a vacation with pay or, where appropriate, four per cent vacation pay. If the harvester works for an employer for less than 13 weeks in a year, he or she is not entitled to vacation pay.
Vacation pay need only be paid on the wages earned while harvesting or on other non-exempt wages. For example, if an employee spends most of her time harvesting fruit, but occasionally works in the office and sometimes works in the cultivation of the plants, vacation pay would only be payable on the wages earned while harvesting and while in the office, but not on the wages earned while cultivating, as non-harvester employees working on a farm in primary production are exempted from the vacation pay provisions by s. 2(2) of this regulation.
Section 41 of the Act, under which the Director of Employment Standards may approve an agreement for an employee to forego taking vacation to which he or she is entitled, does not apply to harvesters.
Part X of the Employment Standards Act, 2000 (Public Holidays) applies to a person employed for at least 13 weeks as a harvester. In other words, unlike regular employees to whom Part X applies, harvesters are entitled to public holiday entitlements only once their employment (as a harvester) reaches 13 weeks or more. Because the words used in this section are "a period of 13 weeks or more", the 13 weeks must be consecutive. This is unlike s. 26, where the 13 weeks do not need to be consecutive — see O Reg 285/01, s. 26 for more information.
Once it is determined under s. 27(1) that the public holiday provisions apply to a harvester, the employee is deemed to be employed in a "continuous operation". The public holiday entitlements for employees in continuous operations are different than they are for other employees. See ESA Part X (Public Holidays) for further discussion.
Section 28 sets out special rules for the commission automobile sales sector.
Section 28(1) states that s. 28 applies to all employees who sell automobiles on a commission basis, whether their remuneration is entirely or only partially paid by commission.
Many car salespeople are paid on a pure commission basis. In order to ensure that employees have some income during periods of slow sales, many of these employees receive a regular draw, or advance, against commissions. Section 28 operates in this context and is intended to ensure that the minimum wage requirement of the Employment Standards Act, 2000 is met.
Sections 28(2) and (3) use the term "pay period" for purposes of these special provisions respecting commission automobile sales employees. These sections require employers to pay each employee an amount at least equal to the minimum wage for each pay period, and stipulate that a pay period shall not exceed a period of one month in length.
These provisions introduce the term "reconciliation period" (as distinct from "pay period"), and prescribe the dates of four reconciliation periods a year. Where a commission automobile sales employee receives wages in the form of a draw or advance against commissions earned, the employer is required to reconcile at the end of each reconciliation period the amount advanced with the amount of commissions that the employee earned. The reconciliation cannot result in the employee being paid less than minimum wage for each pay period. Further, the balance at the end of each reconciliation period cannot be carried forward into the next reconciliation period. An employee's account must start fresh, with a balance of zero, at the beginning of each reconciliation period.
Under this reconciliation process, if the employee earns more in commissions than he or she received in draws during a particular reconciliation period, the surplus is to be paid to the employee. The surplus may not be carried forward past the end of the reconciliation period in order to offset any deficit that may accrue on the employee's account during later reconciliation periods.
Similarly, if the employee earns less in commissions than he or she received in draws during a particular reconciliation period, the "deficit" may not be carried forward past the end of the reconciliation period in order to offset commissions earned in later reconciliation periods. (Note, however, that the employer may be able to recoup the amount of the deficit - so long as it does not result in the employee earning less than minimum wage for each pay period - by making deductions from wages earned in the next reconciliation period if the employee provides written authorization to do so.)
This section requires that reconciliation take place at the end of an employee's employment (whether the employee quit or the employer terminated the employee). Because this section states that s. 28(6) applies, the reconciliation must not result in the employee receiving less than minimum wage for each pay period.
Subsections 32(1) and (2) of O. Reg. 285/01 must be read in conjunction with subsections 141(9) and (10) of the ESA 2000. Those provisions state:
141(9) An employer may not require an employee who has made an agreement approved by the Director under a regulation made under paragraph 9 of subsection (1) to work more than 10 hours in a day, except in the circumstances described in section 19.
141(10) If an employee has agreed to work hours in excess of those referred to in clause 17(1)(a) and hours in excess of those referred to in clause 17(1)(b), the fact that the Director has approved the agreement in accordance with a regulation made under paragraph 9 of subsection (1) does not prevent the employee from revoking, in accordance with subsection 17(6), that part of the agreement dealing with the hours in excess of those referred to in clause 17(1)(b).
Together these sections provide that despite s. 17(6) of the ESA 2000 (which provides that an employee can revoke an excess daily hours of work agreement with two weeks’ written notice), employees who were hired on or after September 4, 2001, and who agreed in writing at the time of hiring to work hours in excess of the daily maximum cannot unilaterally withdraw from the agreement (even with two weeks' notice), if the Director of Employment Standards approved the agreement. The agreement can be revoked only if the employer and employee both agree, in writing, to revoke it.
Note that this exception to the revocability of agreements applies only to agreements to work excess daily hours (and only if the agreement was approved by the Director of Employment Standards). These employees retain the right under s. 17(6) to revoke, with two weeks' written notice, agreements to work excess weekly hours.
Note also that pursuant to s. 141(9) employees who are party to these approved agreements to work excess daily hours cannot be required to work more than 10 hours a day except in s. 19 exceptional circumstances.
See ESA Part VII (Hours of Work and Eating Periods) for a discussion of these provisions.
O Reg 286/01 provides various exemptions from the prohibition in s. 44(1) of the Employment Standards Act, 2000 against age, sex and marital status and discrimination in benefit plans; certain limited types of age, sex and marital status discrimination are specifically allowed by O Reg 286/01.
References to spouse and marital status must be read to include same-sex spouses as well as opposite-sex spouses (whether married or common-law) and same-sex marital status as well as opposite-sex marital status (whether married or common-law).
Section 1 of O Reg 286/01 provides definitions of various terms for purposes of Part XIII and the regulation only.
Each of the above terms are individually discussed below:
This term is used in O Reg 286/01 in the context of allowing certain differentiations that are "determined on an actuarial basis." It is defined as meaning the assumptions generally accepted and used by a Fellow of the Canadian Institute of Actuaries to establish the costs of benefits including the actuarial equivalents of such benefits, which costs depend upon certain contingencies such as rates of death, accident, sickness and disease, as well as interest rates, early retirement rates, salary scales and termination rates.
The policy of the Employment Standards Program is that a differentiation in a benefit plan is not "determined on an actuarial basis" merely because actuaries have "costed out" the benefits and contributions in the plan using generally accepted actuarial principles. Rather the Program holds that a differentiation is "determined on an actuarial basis" if the benefits or contributions involved are actuarially equivalent. For example, actuaries may determine that benefits in a pension plan are actuarially equivalent based on the relative remaining life expectancies of two employees retiring at different ages (e.g., an employee retiring at age 60 receives $800 a month and an otherwise similar employee retiring at age 65 receives $1,000 a month). Actuaries would determine that the total pay-outs to the two employees would be equivalent once life expectancy and other factors such as interest rates are considered.
Note: These examples are provided for illustration only. They are not necessarily actuarially sound.
Age is defined as any age of 18 or more, but less than 65. Therefore, an employer may, for example, exclude employees from a plan on the basis that they are less than 18 or that they are 65 or older. The prohibition in s. 44 of the Employment Standards Act, 2000 regarding age differentiations applies only to employees and not to differentiations based on the age of the employees' dependants, spouses or survivors.
This term is defined very broadly and includes both lump sum and periodic benefits. Furthermore, it includes benefits that are or will be received by the employee, his or her beneficiaries, survivors or dependants. Therefore, a violation may occur where a plan contains provisions discriminatory on the basis of age, sex or marital status of the employees, regardless of whether any action has been taken pursuant to those provisions. (But see discussion of the definition of "employer" above.) Generally, the definition in the regulation includes amounts accrued or payments to which the employee is entitled under a pension plan, retirement plan or life, health, dental or disability insurance plan.
Dependant is defined by reference to the definition contained in the relevant benefit plan. But the creators of the plan do not have a carte blanche to define the term in absolutely any way they choose; the purposes of the Act and in particular the purposes of the prohibition in s. 44 limit the freedom to define. Thus, the definition cannot make a distinction on the basis of age, sex or marital status of the employees. (In other words, dependent children of married employees must be treated the same as dependent children of single employees.) Further, the definition cannot purport to give the term "dependent" a meaning that is in conflict with its ordinary or commonly understood sense.
This provision defines a disability plan and includes both short-term disability plans (payable for less than 52 weeks) and long-term disability plans. Some pension plans will contain a benefit called a "disability pension". It is important to determine whether such a plan is a pension or a disability plan within the meaning of O Reg 286/01, since different exemptions apply to the two types of plans. In order for a "disability pension" to be considered a pension plan, it must be evident that the disability benefit is part of or ancillary to a pension plan, and that the disability benefit is payable on the employee's retirement or termination of employment.
References in this Regulation to "former Act" are defined to mean the former Employment Standards Act, RSO 1990, c E.14.
This definition includes benefits such as dental plans and plans that pay some or all of the costs associated with such things as prescription medications, massage, physiotherapy or chiropractic treatments, hearing aids, prosthetic limbs, etc.
This definition states that a life insurance plan is one that provides a death benefit, whether payable periodically or as a lump sum, to the employee's beneficiary, survivor or dependant, and includes dismemberment insurance, which is payable for loss of limbs.
This term is defined to include any disability benefit plan under which benefits may be paid for a period of not less than 52 weeks, or until recovery, retirement or death, whichever is the lesser.
This term would apply to persons who are legally married (whether to a person of the same or opposite sex) but is also defined to include single, unmarried parents who are supporting dependent children and persons in a common law relationship as that relationship is defined in the benefit plan. However, the creators of the plan do not have a carte blanche to define the term in absolutely any way they choose; the purposes of the Act and in particular the purposes of the prohibition in s. 44 and the reference to common law relationships in the "marital status" definition itself impose some limit on the freedom to define. Since one of those purposes was to prevent discrimination against employees in common law spousal relationships in employer-provided benefit plans, a plan definition cannot purport to define "common law status" in such a way as to effectively exclude persons in what would ordinarily be understood to be in a common law spousal relationship from the protection of the prohibition.
Since the Ontario Court of Appeal decision in Halpern v Canada (Attorney General), 2003 CanLII 26403 (ON CA), in which the Court ruled that the exclusion of same sex couples from marriage was inconsistent with the equality guarantees in the Canadian Charter of Rights and Freedoms, was not saved by s. 1 ("reasonable limits") and was, therefore, unconstitutional, "common law status as defined in the relevant benefit plan" must include same-sex as well as opposite-sex common law couples.
Based on the common elements of definitions of "spouse" which appear in many Ontario statutes, the Employment Standards Program has adopted a policy under which persons are considered to be common law spouses if they are not legally married to each other and have been living together in a conjugal relationship continuously for a period of not less than three years, or living together in a conjugal relationship of some permanence if they are the natural or adoptive parents of a child. The employer may, of course, adopt a more liberal definition of common law spouse than the one set out in this interpretation.
Any exemptions from Part XIII for employees on the basis of marital status must be applied to legally married employees whether married to someone of the same or opposite sex, to employees in common law marriages (with reference to the above-noted definition and whether in a relationship with a person of the same or opposite sex) and to single, unmarried employees supporting a dependent child or children. Alternatively, if a benefit plan is provided to married employees (which includes legal and common law marriages), it must also be provided to single, unmarried employees supporting dependent children.
This is defined as the date on which an employee can retire and receive a regular (i.e., full) pension as provided in the plan. The normal pensionable age can be determined with reference to age or to years of service.
A pension plan is defined very broadly to include a plan that provides benefits upon retirement (e.g., a superannuation plan) or termination to an employee or his or her spouse or dependant. The definition continues to specifically include various types of pension plans, such as:
It should be noted that some types of pension plans are included in the O Reg 286/01 definition but are not pensions for purposes of the Pension Benefits Act, RSO 1990, c P.8. These types of pensions are:
As noted in the discussion of s. 44 of the Act, sex is defined as including a distinction based on pregnancy and distinctions based on whether an employee is the head of a household or a primary wage earner.
This term is defined to include any disability benefit plan that does not meet the criteria set out in the regulation for a "long-term disability benefit plan" (i.e., a plan under which benefits are payable for a period of at least 52 weeks or until recovery, retirement or death, whichever period is shorter. (See the definition of "long-term disability plan" above.)
This term is defined with reference to the definition of "spouse" contained in a relevant benefit plan. However, the creators of the plan do not have a carte blanche to define the term in absolutely any way they choose; the purposes of the Act and in particular the purposes of the prohibition in s. 44 and the reference to common law relationships in the "marital status" definition impose some limit on the freedom to define. Since one of those purposes was to prevent discrimination against employees in common law spousal relationships in employer-provided benefit plans, a plan definition cannot purport to define "spouse" in such a way as effectively to exclude persons in what would ordinarily be understood to be a common law spousal relationship from the protection of the prohibition.
Since the Halpern v Canada (Attorney General) decision, "spouse as defined in the relevant benefit plan" must include persons in same-sex as well as opposite-sex relationships.
Based on the common elements of definitions of "spouse" which appear in many Ontario statutes, the Employment Standards Program has adopted a policy under which persons are considered to be common law spouses if they are not legally married to each other and living together in a conjugal relationship continuously for a period of not less than three years, or living together in a conjugal relationship of some permanence if they are the natural or adoptive parents of a child. The employer may, of course, adopt a more liberal definition of common law spouse than the one set out in this interpretation.
This is a voluntary contribution that an employee may make to his or her pension plan without obliging the employer to make a corresponding contribution.
Section 2(1) of O Reg 286/01 allows employers to differentiate on the basis of sex in contributions to a pension plan if two requirements are met:
Actuarial tables indicate that women, as a group, tend to live longer than men; because of this, if male and female employees are to be provided by the employer with equal monthly (or other periodic) pension benefits, the employer will have to make greater contributions to the pension plan in respect of female employees than it will have to make in respect of male employees. The exemption allows this to the extent that actuaries have determined that it is necessary to do in order to equalize pension benefits as between male and female employees.
This is a transitional provision designed to prevent the retroactive application of the current exemptions contained in s. 2 of O Reg 286/01 to Pension Benefits Act, RSO 1990, c P.8 ("PBA") plans, insofar as pre-1987 employment is concerned. It must be read in conjunction with s. 2(4), which effectively defines "differentiation" for purposes of s. 2(2) [and also s. 2(3)] as a differentiation that was permitted under the version of the Employment Standards Act that existed in the 1980s by the benefits regulation RRO 1980, Reg 282 prior to the amendment of that regulation in 1988.
The effect of s. 2(2) is that the exemptions from the prohibition against discrimination on the basis of sex previously set out in s. 2 of the former RRO 1980, Reg 282, prior to its amendment by O Reg 443/88, continue to apply to pension plans governed by the PBA insofar as pre-1987 employment is concerned, except where such employment was covered by the PBA's own sex discrimination provisions, contained in ss. 52(3)(b) and (c) of the PBA. The PBA's sex discrimination provisions cover post-1986 employment, but also cover pre-1987 employment if it is dealt with in pension plans established after 1986 or in plan amendments made after 1986.
This is a transitional provision designed to prevent the retroactive application of the current exemptions contained in s. 2 of O Reg 286/01 to plans to which the PBA does not apply, insofar as employment before July 12, 1988, is concerned. Plans not covered by the PBA include profit sharing plans, group registered retirement savings plans, "employee pay all" plans and "retiring allowances" as defined in the Income Tax Act, RSC 1985, c 1 (5th Supp). Like s. 2(2), s. 2(3) must be read in conjunction with s. 2(4), which effectively defines "differentiation" for the purposes of s. 2(2) [and also s. 2(3)] as a differentiation that was permitted under the version of the Employment Standards Act, RSO 1980, c 137 that existed in the 1980s by the benefits regulation RRO 1980, Reg 282 prior to the amendment of that regulation in 1988.
This means that exemptions from the prohibition against discrimination in pension plans on the basis of sex set out in s. 2 of the former RRO 1980, Reg 282 (prior to its amendment by O Reg 443/88) continue to apply to pension plans not governed by the PBA in regards to differentiation in those plans on the basis of sex insofar as pre-July 12, 1988, employment is concerned. Note that even though an employer makes a contribution or pays a benefit on or after July 12, 1988, it will be subject to the old rules regarding sex discrimination to the extent that it relates to employment prior to July 12, 1988.
This section defines "differentiation" for purposes of ss. 2(2) and 2(3) of O Reg 286/01 only. "Differentiation" then means the types of differentiations on the basis of sex, in pension plans, permitted by the predecessor to s. 2 of RRO 1980, Reg 282 under the former Employment Standards Act, RSO 1980, c 137. That predecessor provision read as follows:
Subsection 34(2) of the version of the Employment Standards Act, RSO 1980, c 137 is a predecessor provision to s. 33(2) of the Employment Standards Act, RSO 1990, c E.14 and to s. 44 of the Employment Standards Act, 2000.
O Reg 286/01 permits three types of differentiation on the basis of marital status in pension plans:
The exemption in s. 3(1)(b) for joint and survivor pensions only applies if the pension benefit is payable periodically, that is, in regular instalments rather than in a lump sum. However, s. 3(2) is a "de minimis" provision which states that the exemption in s. 3(1)(b) will still apply if the amount is "commuted", that is, converted to one lump sum in a situation where the periodic payments would otherwise be very small. The benchmark figure used for commutation is that the annual benefit, before commutation, must be not more than two per cent of the Year's Maximum Pensionable Earnings ("YMPE"), as defined in the Canada Pension Plan, in the year that the employee terminated his or her employment. The YMPE is raised each year according to the cost of living.
This section provides that the exemption in s. 3(1)(b) of O Reg 286/01 from the prohibition against marital status discrimination in s. 44(1) of the Employment Standards Act, 2000 does not apply if the pension plan contravenes the provision of the PBA regarding joint and survivor pensions. Section 44 of the PBA provides, subject to certain limited exceptions, that if the employee has a spouse on the date the first instalment of the pension becomes due, and is not living separate and apart from that spouse, the pension must be a joint and survivor pension, payable as long as either spouse is alive. The value of the pension payable to the surviving spouse must not be less than 60 per cent of the pension paid to the employee.
Spouse is defined in the PBA as two persons who:
Sections 4(1)(a)-(e) allows certain age differentiations in pension plans if those differentiations are determined on an actuarial basis. The term "actuarial basis" is defined in s. 1 of O Reg 286/01 as the assumptions used by actuaries to establish the costs of various benefits, including the actuarial equivalents of those benefits, with reference to contingencies such as death, accident, sickness or disease. See the discussion of the definition of the term "actuarial basis" at s. 1(a) of O Reg 286/01 for further information.
It is the policy of the Program that a differentiation in a pension plan is determined on an actuarial basis if the differentiation in contributions to, or benefits paid, under the plan are actuarially equivalent. Assumptions generally used by actuaries with respect to pension plans are set out in the Survey of Actuarial Assumptions and Funded Status, as follows:
Section 4(1)(a)-(e), therefore, allows five types of age differentiations in a pension plan if these differentiations are "determined on an actuarial basis":
"Voluntary additional contribution" is defined in s. 1 of O Reg 286/01 as a voluntary contribution that an employee may make to a pension plan without obligating the employer to make a corresponding contribution.
The exemption refers to contributions that are mandatory once the employee is enrolled in the plan. It does not refer to "required" contributions in the sense that enrolment in the plan is compulsory.
This exemption is therefore conditional on the plan complying with the PBA's provisions regarding age differentiation. The major provisions of the PBA in this regard are:
There is an increasing trend to defined contribution plans, in which the employer agrees to a certain level of contributions rather than to paying a certain level of benefits. When switching from a unit-benefit or defined benefit to a defined contribution plan, it may be necessary for the employer to make a one-time, lump sum "top-up" to the credit of older employees, to prevent their pensions from being adversely affected by the transition. The exemption allows this differentiation provided that the "top-up" has been actuarially calculated.
This exemption allows age differentiations in non-PBA pension plans if they are determined on an actuarial basis, and age differentiations in PBA plans if they are determined on an actuarial basis and not in contravention of the PBA's provisions regarding age differentiation. The major provisions of the PBA regarding age differentiation are set out above, in the discussion of s. 4(1)(c).
This is a transitional provision designed to ensure that the requirement that age differentiations in pension plans be determined on an actuarial basis (which came into effect on July 12, 1988) does not have retroactive effect. Therefore, age differentiations set out in s. 4(1)(a), (b) and (e) need not be determined on an actuarial basis if they relate to that portion of the employee's employment that occurred before July 12, 1988. The provision that corresponded to s. 4(1)(c) in the benefits regulation in force prior to July 12, 1988, already required that particular differentiation to be on an actuarial basis, so it was not necessary to include this section in the transitional provision. Section 4(1)(d) is not included in the transitional provision because it did not introduce any new constraint, but simply assisted the employer in preserving the "status quo" when switching from one type of plan to another.
This exemption to the general prohibition against age differentiations in pension plans under s. 44(1) of the Employment Standards Act, 2000, unlike the exemptions created in s. 4(1) of O Reg 286/01, is not based on actuarial equivalents. Section 4(3) allows a differentiation based on age in a pension plan if the plan allows for voluntary retirement before the age of 65. Without this section, a pension plan in which contributions or benefits varied in accordance with an early (voluntary) retirement age of 60, for example, would not be permissible unless the differentiation was determined "on an actuarial basis". It is important to note that this exception only applies to voluntary retirement, not to mandatory retirement. Furthermore, in the case of PBA plans, the exception only applies if the plan does not contravene the provisions of the PBA regarding normal retirement dates and early retirement pensions. The PBA provisions regarding normal retirement dates are found in s. 35 of the PBA, which provides that the normal retirement date shall not be later than the date on which the employee reaches age 66, and that an employee who works past the normal retirement date may be entitled to continue to accrue benefits until actual retirement, subject to any limits on service credits or benefit amounts set out in the plan. The PBA provisions regarding early retirement are found in s. 41 of the PBA, which provides that an employee who is within 10 years of attaining the normal retirement date and terminates employment after 1987, and has been a member of the plan for at least two years, is entitled to elect to receive an early retirement pension.
Section 5 of O Reg 286/01 provides that s. 44(1) of the Employment Standards Act, 2000 does not apply to two types of differentiation made on the basis of sex in a life insurance plan.
Section 5(a) allows a differentiation in respect of employee contributions to a voluntary employee-pay-all life insurance plan, where the differentiation is determined on an actuarial basis. According to current actuarial tables, women tend to live longer than men. Therefore, life insurance premiums are higher for men than for women of the same age (because men are likely to die earlier and, therefore, with a fewer number of premiums having been paid on their behalf). The exemption in s. 5(a) allows for actuarially-based differentiations in life insurance plans in which participation by the employee is voluntary and in which the employee pays all of the premiums. Therefore, such plans may have greater contribution rates for male employees than for female employees, if the difference is determined according to the actuarial tables.
Section 5(b) allows differentiations in respect of employer contributions to a life insurance plan where the differentiation is based on sex if it is made on an actuarial basis and in order to provide equivalent benefits. This type of differentiation might be made where the employer wishes to ensure that male and female employees receive the same life insurance benefits.
Section 6(1) provides that the prohibition against differentiation in s. 44(1) of the Employment Standards Act, 2000 does not apply to three types of differentiations made on the basis of marital status in a life insurance plan.
Section 6(1)(a) states that benefits under a life insurance plan that are payable periodically to the surviving spouse of a deceased employee are exempt from the prohibition against differentiations on the basis of marital status in s. 44(1) of the Act. This exemption applies where the benefits are to the deceased employee's surviving spouse for his or her life, or until he or she becomes the spouse of another person. Also see s. 6(2) of O Reg 286/01, discussed below, which provides that this provision also applies to benefits of less than $25/month that have been commuted to a lump sum benefit.
Section 6(1)(b) provides that a life insurance plan may differentiate on the basis of marital status where the plan provides for benefits payable to an employee upon the death of his or her spouse. The purpose of the exemption is to allow an employee to insure his or her spouse's life through the employer's plan.
Section 6(1)(c) permits a life insurance plan to differentiate on the basis of marital status with respect to employer or employee contributions where the plan provides periodic benefits to the surviving spouse of the employee. This means that a plan may have higher employer or employee contributions in order to provide periodic survivor benefits to a deceased employee's spouse.
This exemption has no "life-time or until the person becomes a spouse" condition, and it does not have a commutation exclusion for small amounts - see s. 6(2) of O Reg 286/01, below. This exemption could apply in respect of contributions to any plan that provided for a periodic life insurance benefit payment, of any duration, to the employee's surviving spouse.
The following are examples of provisions that would not be permissible in a life insurance plan, because they discriminate on the basis of marital status and are not exempted by s. 6(1):
Section 6(2) states that the benefits under an insurance plan described in s. 6(1)(a) will be deemed to be payable periodically, notwithstanding that they have been commuted to a lump sum and would have been less than $25 a month if they had not been commuted. Commutation involves the transformation of periodic benefits into one lump sum benefit. It is done by determining the current "lump sum" value of the periodic payments, using actuarial assumptions respecting such matters as life expectancy and interest rates.
Section 7(a) provides that a voluntary, employee-pay-all life insurance plan (i.e., a plan where the employees may choose to participate but to which the employer does not make any contributions) may differentiate between employees on the basis of age on an actuarial basis with respect to both benefits and contributions. In other words, such a plan may provide benefits or require contributions that vary on an actuarial basis according to age. For example, the employee may contribute $100 a year toward his or her life insurance and receive benefits that vary on an actuarial basis according to his or her age. Alternatively, such a plan could provide $50,000 in insurance for each employee and the employees' contributions would vary on an actuarial basis according to their age.
Section 7(b) provides that employer contributions to a life insurance plan may differentiate with respect to an employee's age if the differentiation is made on an actuarial basis in order to provide equal benefits under the plan. As a result, an employer may make increased contributions for older employees, provided these increases are based on actuarial tables, in order to provide an actuarially equivalent life insurance benefit under the plan to all employees.
An example of a provision that would not be permissible in a life insurance plan, because it differentiates on the basis of age and is not exempted by s. 7 would be a provision in an employer-funded plan that provides a lump sum survivor benefit that varies in amount according to the number of years left to normal retirement age at the time of the employee's death.
Section 8 allows two types of differentiations in disability insurance plans.
Section 8(a) allows a disability plan that is a voluntary, employee-pay-all plan, to differentiate in employee contributions on the basis of age or sex, on an actuarial basis. The purpose of the exemption is to permit this kind of plan to provide for increased contributions by employees in age or sex categories associated with higher disability insurance premiums. It is important to note that the exemption in s. 8(a) does not allow for a differentiation in benefits in such a plan, unlike the corresponding exemption for voluntary employee-pay-all life insurance plans in s. 7(a) of O Reg 286/01.
Section 8(b) allows a disability plan to differentiate in the rate of employer contributions to the plan on the basis of age or sex, on an actuarial basis, in order to provide equal benefits under the plan. (This exemption is similar to the corresponding exemption created in s. 7(b) with respect to life insurance plans.) In other words, where the employer provides a disability plan for which the employer makes contributions, the employer may make increased contributions for employees of a certain age or sex, provided that it results in the employees receiving actuarially equivalent benefits under the plan.
Section 8(c) of RRO 1990, Reg 321 under the former Employment Standards Act contained the following provision:
This provision explicitly permitted a benefit plan to deny disability benefits to a female employee on pregnancy or parental leave or on a leave that constituted a "greater benefit" than a leave under Part XI of the former Employment Standards Act.
The provision thus provided an exception to the prohibition against discrimination in the provision of benefits plans on the basis of sex, by allowing disability plans to deny short-or long-term benefits to female employees on pregnancy and parental leave.
In Brooks v Canada Safeway Ltd., [1989] 1 SCR 1219, 1989 CanLII 96 (SCC), a 1989 case decided under Manitoba human rights legislation, the Supreme Court of Canada held that because discrimination on the basis of pregnancy is discrimination on the basis of sex, it is discriminatory to deny women short-term or long-term disability benefits during that portion of a leave that they are unable to work for reasons related to pregnancy and childbirth, as these constituted valid health-related reasons for absence from work. As a result, it would constitute discrimination on the basis of sex to deny a female employee disability benefits for that part of the leave.
As s. 8(c) of the former RRO 1990, Reg 321 may have been perceived as inconsistent with the Supreme Court of Canada's reasoning in Brooks v Canada Safeway Ltd., no corresponding provision was incorporated into O Reg 286/01.
The position of the Employment Practices Branch is that where a disability benefit plan is provided by or through the employer, the reasoning in Brooks v Canada Safeway Ltd. will apply so as to give a female employee who is on pregnancy or parental leave a right to short-term or long-term disability benefits during that portion of her leave in which she is unable to work for reasons of health related to pregnancy or childbirth. (Note, however, that where an employer provides disability benefits to employees on leaves other than Part XIV leaves, s. 10 of O Reg 286/01 will apply to require that such benefits be provided to both female and male employees on a Part XIV leave and for the entire period of the leave.)
For other court decisions respecting the right to disability benefits for female employees during the "health-related" portion of a pregnancy leave, see Alberta Hospital Association v Parcels, 1992 CanLII 6106 (AB QB) and O.S.S.T.F., District 34 v Barton (1996), 91 OAC 253 (ON SC).
Section 9(a) allows a health benefit plan in which participation is voluntary and to which the employer does not contribute to set employee contribution rates that vary on an actuarial basis because of sex. Note that the exemption does not allow the benefits to vary according to sex.
Section 9(b) allows a health benefit plan to set employer contribution rates that vary on the basis of employees' sex if such differentiations are made on an actuarial basis in order to provide equal benefits. In other words, this exemption allows an employer's (but not an employee's) contribution rates to vary on the basis of sex if the contribution rates are calculated according to actuarial tables.
Section 9(c) allows employers to provide a health benefit plan that differentiates in benefits or employee contributions on the basis of marital status, in order to provide benefits to the employee's spouse or dependent child. However, it would be a violation of Part XIII if the plan made a distinction between employees with marital status. For example, this exemption does not allow an employer to provide a health benefit plan that pays benefits for the health expenses of the children of employees with a spouse but not the children of single employees (who are defined as having marital status under O Reg 286/01).
Section 9(d) allows a differentiation in a health benefit plan with respect to employer contributions where there are specified premium rates for employees having marital status and different premium rates for employees without marital status, and the differentiation in the employer contributions is on the same proportional basis.
An example of this type of agreement would be an extended health plan where single employee coverage costs $X a month, but family coverage costs $Y a month, a higher amount. Provided that the employer's subsidy is proportionally the same, i.e., 50 per cent of X and 50 per cent of Y, it will not be in violation of s. 44 of the Employment Standards Act, 2000 despite the fact that the employer is contributing more in terms of dollars and cents on behalf of the employees who have marital status.
A health benefit plan may not discriminate on the basis of age, sex or marital status, except as provided in s. 9 of O Reg 286/01. Some examples of discrimination in a health benefit plan that would not be permitted are:
Section 10 provides that if employees on a leave other than a leave under ESA Part XIV, e.g., educational leave, are entitled to participate in a benefit plan, then employees on a leave under Part XIV (i.e., pregnancy, parental, family medical, family caregiver, organ donor, critical illness, personal emergency , child death, crime-related child disappearance, domestic or sexual violence, declared emergency or reservist leave), or on any longer leave of absence that constitutes a greater benefit under ESA Part III, s. 5(2) must be entitled to participate in the plan.
Under ESA Part XIV, ss. 51(1), (2) and (3), an employee on any type of Part XIV leave, except reservist leave (i.e. pregnancy, parental, family medical, family caregiver, organ donor, personal emergency, domestic or sexual violence, critical illness, child death, crime-related child disappearance or declared emergency leave) already has the statutory right to continue to participate in pension plans, life insurance plans, accidental death plans, extended health plans and dental plans during the leave. Section 10 therefore is redundant to these types of plans with respect to employees on pregnancy, parental, family medical, family caregiver, domestic or sexual violence, critical illness, organ donor, personal emergency, child death, crime-related child disappearance or declared emergency leave because employees on such leaves have a right under the ESA 2000 to participate in them even if employees on other types of leave do not.
However, the rules are different with respect to reservist leave. An employee on reservist leave does not have the “automatic” right under the ESA 2000 to participate in pension plans, life insurance plans, accidental death plans, extended health plans and dental plans during their leave. However, where an employer provides other types of benefit plans other than the plans enumerated in ESA Part XIV, s. 51(2), to employees on a leave other than a leave under Part XIV (e.g., education leave), then s. 10 would operate to entitle employees on a reservist leave to participate in those other plans.
Undoubtedly, the most important type of benefit plan not mentioned in ESA Part XIV, s. 51 is a disability benefit plan. Note that s. 51 also refers to "prescribed" types of benefit plans prescribed by the regulations but no other types of benefit plans have been prescribed. However, it should be noted that the Employment Practices Branch takes the position, based on the Supreme Court of Canada decision in Brooks v Canada Safeway Ltd., [1989] 1 SCR 1219, 1989 CanLII 96 (SCC), that where a disability benefit plan is provided by or through the employer, a female employee who is on pregnancy or parental leave will have a right to short-term or long-term disability benefits during that portion of their leave in which they are unable to work for reasons of health related to pregnancy or childbirth.
This section applies to an employee who was excluded from participation in a benefit plan by reason of a provision in the plan that became impermissible on November 1, 1975, the date when Part X of the Employment Standards Act, 1974, SO 1974, c 112, the original predecessor to Part XIII, came into force. Under s. 11, such an employee is entitled to participate in the plan from the time that the predecessor began to apply to the plan.
Section 12 states that no employer may reduce either its contributions to or employee benefits under a plan in order to comply with Part XIII and O Reg 286/01 or Part X of the former Employment Standards Act and its related regulations or its predecessors. This is similar to the provision in s. 42(3) of the Employment Standards Act, 2000, which prohibits an employer from reducing the pay of an employee in order to comply with the equal pay provisions of the Act. An example of a reduction prohibited by s. 12 of O Reg 286/01 would be where the employer reduced the benefits of male employees under a health insurance plan to those received by females, instead of increasing the benefits paid to females, in order to provide equal benefits to male and female employees.
This section states that where an employee has his or her normal pensionable rate increased in order to comply with the original predecessor to Part XIII of the Employment Standards Act, 2000, the employee shall be entitled to his or her pension benefits on the normal pensionable date as it was before it was increased. An example of the type of situation that this provision was meant to address would be a pension plan that, prior to November 1, 1975, had a normal pensionable date of the day on which the employee reached age 60 for females and a normal pensionable date of the day on which the employee reached age 65 for males. In order to comply with the predecessor to Part XIII when it first became law, the plan might have been amended to provide a normal pensionable date of the day on which the employee reached age 65 for both males and females. However, according to s. 13, the females in such a plan would retain the option to retire at age 60 with a full pension. Section 13 must, however, be read as subject to the Pension Benefits Act, RSO 1990, c P.8, which prevails over other legislation in the event of a conflict and which, subject to certain exceptions, prohibits differentiation on the basis of sex in a pension plan.
This regulation supplements the building services providers provisions in the Employment Standards Act, 2000 by identifying prescribed services for a building and prescribed employees of building services providers. The regulation also sets out what information building services providers must give about their employees for the purposes of ESA Part XIX, s. 77(1).
Section 1 of O Reg 287/01 prescribes "services that are intended to relate only to the building and its occupants and visitors with respect to a parking garage or parking lot" as "building services". This would include, for example, an underground parking garage that is part of an office tower or a shopping centre parking lot.
Section 1 of O Reg 287/01 prescribes "services that are intended to relate only to the building and its occupants and visitors with respect to concession stands" as "building services". A concession stand is typically a variety, food or souvenir stand located inside premises such as a stadium, a museum, an arena or a public transportation facility. Persons using the premises may have to pay to enter and use the premises, such as in a stadium, a museum, a public transportation facility (e.g., the Toronto Transit Commission), or they may be able to enter and use the premises without paying admission, such as in the case of an airport. In contrast to food courts, virtually all of the persons using the concession stand services will be persons who are utilizing the building as a whole (rather than for the food services provided there) and as a result, such services will typically "relate only to the building and its occupants and visitors". For the most part, no one would pay to enter the Rogers Centre (formerly the Sky Dome) for example, for the sole purpose of purchasing a hot dog at one of the concession stands within the Rogers Centre. Similarly, the concession stand in a TTC subway station is intended for the use of persons using the subway facilities. Virtually no one would take an escalator down into a TTC subway station for the sole reason of buying a chocolate bar, regardless of whether the stand was located outside or inside the point at which one has to pay a fare to enter. Thus, the concession stand services are utilized by persons who invariably are also using the building as a whole, whereas a food court restaurant is typically used by member of the public at large, even though they have no other business to conduct in the building.
Section 1 of O Reg 287/01 has prescribed "property management services that are intended to relate only to the building" as "building services". Property management companies are typically contracted by the owner of a building such as a condominium or apartment building to provide cleaning and security services, etc. The property management company will then often enter into sub-contracts with cleaning and security companies, whose employees will perform the necessary services. Pursuant to s. 1 of O Reg 287/01, although such services are provided indirectly by the property management company, they are included in the definition of "building services". This is consistent with the definition of "building services provider" in s. 1(1) of the Employment Standards Act, 2000, which includes any person who provides building services for a premises, including the owner or manager of the premises.
It is the Program’s view that under O Reg 287/01, "property management services that are intended to relate only to the building" must refer to managing the property rather than "working" it. As a result, "property management services" would not extend to the direct performance of manual services. More particularly, it would not extend to the direct performance of manual services such as maintenance (which services, in and of themselves, would not be considered "building services") although it would include supervising and paying for the provision of maintenance services.
On the other hand, the administrative services (e.g., payroll services, accounts payable) performed by the employees of the property management company may be considered to be "property management services" on the basis that they are integral to the provision of the property management services. However, as per O Reg 287/01, such services must "relate only to the building". This means that they must pertain only to the employer’s management of the building in question and not to other aspects of the employer’s operation (e.g., another building). For example, if a payroll clerk processed payroll only for those employees working at the building, they would be captured as employees providing property management services "that relate only to the building" whereas such an employee who also provided payroll services in respect of the employer’s employees working at other premises as well, would not.
Section 2(1) sets out the exemptions in which a new provider is not required to comply with the termination and severance provisions in ESA Part XV.
This category of employees consists of those employees who actively worked for the replaced provider by providing building services at the premises prior to the changeover date but whose job duties were not performed primarily at the building premises affected by the change-over of providers during the 13-week period prior to the changeover date. This includes employees who were on lay-off, if they continued to perform job duties at the premises even though their hours and/or pay were reduced. In other words, this exemption will apply if the building premises affected by the change in providers is not the employee’s principal place of work with the replaced provider during the 13-week period prior to the changeover date.
It is important to note that the issue of whether the employee works for employers other than the replaced provider (either on a part-time or a full-time basis) is irrelevant in determining whether the employee’s job duties are performed primarily at the premises. In determining whether or not the site affected by the change in provider is the place where the employee’s job duties are primarily performed, the officer should look at the breakdown of the hours that the employee spends at each location working for the replaced provider.
It is not necessary that the majority of the hours spent working for the provider be at the premises in question in order for the "performed primarily at the premises" test to be met. What is necessary is that the premises be the main place of work with that provider in that the employee has a significant attachment to the premises in question in terms of the number of hours spent there every week (i.e., the employee spends significantly more time at that site than working at other sites for the replaced provider).
It should be noted that if the exemption applies, the employee may still be entitled to termination and severance pay from the replaced provider.
In determining whether or not the site affected by the change is the place where the employee’s job duties were primarily performed for the replaced provider, the employment standards officer should look at the breakdown of the hours that the employee spent at each location working for that provider.
An employee who works for an office cleaning company has the following weekly schedule:
It is evident that Building A was the employee’s principal place of work with the replaced provider. The employee spent the majority (55 per cent) of their time at Building A. The exemption in O Reg 287/01, s. 2(1) paragraph 1 would therefore only apply if there were a change in contract at either Building B or Building C, as the employee did not perform their job duties primarily at those premises.
An employee who works at a number of buildings for the same provider but does not spend the majority of their time working at any one of these buildings has the following weekly schedule:
In this case, the employee spent most of their time at Building C, but not the majority (i.e., less than 50 per cent) of their time there. However, Building C will be considered the employee’s primary place of work because the employee had a significant attachment to the site in question in terms of the number of hours spent there every week (i.e., they spent significantly more hours working there for the replaced provider than working at other sites for that provider). The exemption in O Reg 287/01, s. 2(1) paragraph 1 would therefore apply only if there were a change in contract at Building A, B or D as the employee did not perform their job duties primarily at those premises.
Some employees may not have any premises as their principal place of work.
An employee has the following weekly schedule:
In this example, the employee does not work the majority of hours at any one building site (i.e., less than 50 per cent) and does not have any significant attachment to any one building site in particular (i.e., theydid not spend significantly more hours working at any one building for the provider than other buildings). Therefore, the exemption in O Reg 287/01, s. 2(1) paragraph 1 would apply if there were a change in contract at any of Buildings A, B, C, D or E as the employee did not perform their job duties primarily at any of those premises.
However, the exemption would not apply if, for example, Buildings A, B, and C were all part of one premises (e.g., an office complex consisting of three towers) and there was a change in contract with respect to the provision of building services at any of those three towers. In that case, the employee would be working 64 per cent of their hours at the premises and would be considered to perform their job duties primarily at the premises consisting of Buildings A, B and C.
This category is essentially an extension of category 1 to exempt those employees providing building services at the premises who were not actively at work with the replaced provider immediately before the changeover date, and whose job duties were not performed primarily at the site during their most recent 13 weeks of active employment.
The employee was not actively at work immediately before the changeover date of June 1, 2015. In addition, the employee had not been primarily providing services at premises A in their most recent 13 weeks of active employment from January 1 to March 30, 20015. As a result, the new provider is exempt under O Reg 287/01, s. 2(1) paragraph 2 from the requirement to comply with the termination and severance provisions of the Employment Standards Act, 2000 with respect to such employees.
As with category 1, if the exemption applies, the employee may still be entitled to termination and severance pay from the replaced provider.
This is the third category of employees in regards to whom the new provider is exempt from the obligations set out in ESA Part XIX, s. 75(2). The exemption applies to those employees who have not worked at the premises for at least 13 weeks in the 26 weeks preceding the changeover date - the day on which the new provider begins to provide services at the premises.
One of the purposes of this category is to prevent replaced providers from transferring their less desirable and sometimes senior employees to the site in question upon learning that their contract will not be renewed. This may happen where the replaced provider is attempting to off-load responsibility for their termination and severance pay onto the new provider.
However, O Reg 287/01, s. 2(1) paragraph 3must be read with reference to ss. 2(3) and (4) which state as follows:
Section 2(3) states that in determining the employee’s services at the premises, the 26-week period in O Reg 287/01, s. 2(1) paragraph 3 shall be calculated without including any period during which the provision of building services at the premises was temporarily discontinued.
For example, where a university cafeteria service closes for the summer, the 26-week period prior to the changeover date may be extended by the number of weeks during which the cafeteria was closed.
The 26-week period in O Reg 287/01, s. 2(1) paragraph 3 will begin 26 weeks prior to May 31, 2016, because it will not include the 12 weeks that the cafeteria was closed. The exemption in O Reg 287/01, s. 2(1) paragraph 3 would therefore apply to any of Company A's employees who did not work at the university cafeteria for at least 13 weeks during the 26-week period prior to May 31.
Section 2(4) states that in determining the employee’s services at the premises, the 26-week period in O Reg 287/01, s. 2(1) paragraph 301 shall be calculated without including any period during which the employee was on leave of absence under ESA Part XIV. Thus the 26-week period for such an employee may be extended by the time spent on leave.
The employee had technically worked only eight weeks in the 26 weeks prior to the changeover date. However, because the 52 weeks of leave are not included in the calculation of the 26-week period, it would be extended to 78 weeks prior to the changeover date (i.e., 18 weeks prior to the commencement of the employee’s leave under ESA Part XIV). Consequently, the exemption in O Reg 287/01, s. 2(1) paragraph 3 would apply if the employee had not worked at the premises for at least five of the 18 weeks prior to commencing her leave.
Despite the fact that ESA Part XIV, s. 53 provides that an employee who takes a leave under ESA Part XIV is entitled to be reinstated after the leave, the new provider is not the employer referred to in s. 53 if an employee was on leave as of the changeover date, unless the new provider hires that employee within 13 weeks of that date. It is the new provider’s choice whether it wishes to hire such an employee and, if so, what terms it wishes to offer. If the new provider does not hire the employee, the new provider must comply with the employee’s termination and severance entitlements under ESA Part XIX, s. 75(2)
As with the exemptions in O Reg 287/01, s. 2(1) paragraphs 1 and 2, if the exemption applies, the employee may still be entitled to termination and severance pay from the replaced provider.
This paragraph creates an exemption with respect to those employees of the replaced provider that refuse a reasonable offer of employment with the new provider. It must be read in conjunction with s. 2(2), discussed below.
This category consists of employees who refuse an offer of employment with the new provider that is reasonable in the circumstances. In accordance with s. 2(2), the terms and conditions of the employee’s employment with the replaced provider on the date of the request for information under ESA Part XIX, s. 77(1) are taken into consideration in determining whether the offer is reasonable. A comparison may therefore be made to such terms and conditions of the employment offered by the new provider to the remuneration, benefits, hours and schedule of work degree of responsibility, etc., with the replaced provider. See also O Reg 288/01, s. 2(1) para. 5 for a discussion of what constitutes reasonable alternate employment in the context of exemptions from the notice of termination provisions.
However, the terms and conditions of employment with the replaced provider as of the date the information is requested under ESA Part XIX, s. 77(1) are not the only circumstances to be considered in determining whether the offer is reasonable. For example, it may be appropriate to consider wage increases scheduled to take effect after the request date. On the other hand, the terms and conditions of employment of other employees of the new provider or the new provider’s ability to pay would clearly not be relevant in determining whether the offer was reasonable.
One question that may arise is whether the exemption regarding the refusal of a reasonable offer of employment applies if the new provider makes the offer some time after it begins to provide services at the premises. It is the Program’s view that the exemption will apply if a reasonable offer (having regard to the terms and conditions the employee had with the previous employer) is made within the 13 weeks after the changeover date (i.e. the day on which the new provider began servicing the premises) and is refused.
As with the exemptions in s. 2(1) paragraphs 1, 2 and 3, if the exemption in paragraph 4 applies, the employee is still entitled to termination and severance pay from the replaced provider.
Sections 2(3) and (4) are discussed in detail above in s. 2(1).
The changeover date is accordingly not the date the new provider is advised that they are the successful bidder, unless the new provider also begins to provide services at the premises on that same date.
The changeover date is relevant to the exemptions in O Reg 287/01, s. 2 from a new provider’s obligations in ESA Part XIX, s. 75 to comply with the termination and severance provisions in ESA Part XV. The exemptions are discussed in further detail in s. 2(1) above.
The above information requirements are reasonably straightforward.
Job duties as well as indication of the person to whom the employee reports.
This is the employee’s "regular rate" as defined in s. 1(1) of the Employment Standards Act, 2000. The words "actually paid to the employee" are intended to prevent the replaced provider from attempting to intimidate potential bidders by inflating the amount of the potential Part XV (Termination and Severance of Employment) liability through such devices as a retroactive pay increase, which the employees did not receive prior to the information request.
This information is required because Part XV (Termination and Severance of Employment) of the Act requires that the employer continue the employer’s share of the benefit plan contributions during the period of notice set out in s. 57 in accordance with s. 60(1)(c). If notice is not given, then the amount of the benefit plan contributions that would have been paid by the employer during the notice period is included in the pay in lieu of notice owing to the employee in accordance with s. 61(1)(b).
See ESA Part I, s. 1 for a discussion of these terms.
As termination pay and severance pay are calculated based on the employee’s wages in a regular non-overtime work week, the information on hours worked in a "regular work day" and "regular work week" provides a potential new provider or the new provider with the necessary information to estimate the extent of the potential liability and subsequently, to determine the actual amount of the Part XV (Termination and Severance of Employment) entitlements for employees of the replaced provider. The daily hours information could also assist the new provider in determining whether contemplated offers of work would be considered reasonable (e.g., where the new provider will be establishing a different shift schedule).
Paragraph 4 of s. 3(1) of O Reg 287/01 must be read in conjunction with s. 3(3) of the regulation which states that paragraph 4 does not apply if the employee’s hours of work vary from week to week:
3(3) If the employee’s hours of work vary from week to week, paragraph 4 of subsection (1) does not apply and the owner or manager shall, instead, provide the number of the employee’s non-overtime hours for each week that the employee worked during the 13 weeks before the request date.
See the discussion of s. 3(3) below.
This information will also assist a potential and actual new provider to determine the amount of termination and severance pay liability. (Note that this information will have to be read in conjunction with the information required under paragraph 6 regarding previous periods of employment attributed to the replaced provider.)
This provides that information must be given concerning the periods of employment attributed to the replaced provider under s. 10 of the Act and the provisions of the former Employment Standards Act dealing with continuity of employment and building services providers. See ESA Part IV, s. 9(4) for more detailed information.
It is important to note, however, that this requirement is limited to information regarding those periods of employment attributed to the replaced provider by the s. 10 continuity of employment provisions in the Act and predecessors to that section. This provision does not require the building owner or manager to provide information regarding separate periods of employment with a replaced provider which are treated as one period of employment in accordance with s. 8 of O Reg 288/01 for the purposes of notice of termination/termination pay or information or information regarding separate periods of employment with the replaced provider which are added together for the purposes of calculating entitlements to severance pay. As a result, this information may not accurately reflect the employee’s "actual" period of employment with the replaced provider for the purposes of either notice of termination or severance obligations. In addition, the information required does not specify whether the employee falls into any of the exemptions from notice or severance set out in O Reg 288/01. Thus, to some extent, the entity bidding on the contract will have to estimate the extent of the potential termination and severance pay liability.
The "request date" is the date on which information is requested under s. 77(1) or (2) of the Act. This information is required so that the potential new provider may determine whether the successful new provider would be exempt from s. 75(1) of the Act by virtue of paragraph 3 of s. 2(1) of O Reg 287/01. See O Reg 287/01, s. 2 for further discussion of this exemption.
Paragraph 7 of s. 3(1) of O Reg 287/01 must be read in conjunction with ss. 3(4) and 3(5) of the regulation which state:
The final piece of information required under paragraph 8 of ss. 3(1) of O Reg 287/01 is very similar to that which describes those categories of employees in respect of whom the new provider is not required to comply with Part XV of the Act. However, the information requirement in paragraph 8 of s. 3(1) concerns the work done by the employees in the 13 weeks prior to the request date whereas the exemptions in paragraphs 1 and 2 of s. 2(1) concern the work done by the employees in the 13 weeks preceding the changeover date. Therefore, the information provided under s. 3(1) may assist the bidder to identify employees in respect of whom it would have no termination and severance obligations, but it would not definitively identify those to whom the exemption would apply.
The new provider of services is consequently entitled to request additional and updated information regarding employees of the previous provider who are performing work at the premises. All information, including the information listed in paragraphs 1 to 8 of s. 3(1) which may have been provided at the time the new provider was bidding on the contract, must be accurate as of the date of the subsequent request under s. 77(2).
Paragraph 2 of s. 3(2) of O Reg 287/01 also allows the new provider to request the names, addresses and telephone numbers of the employees engaged in providing services at the premises on the date the request for information is made.
During the period from the time the new provider is awarded the contract to the "changeover date" of the contract, when the new provider begins to provide services at the building premises, the employees' names, residential addresses and telephone numbers can be used to:
This subsection ensures that the new provider has access to the necessary information to determine the actual Part XV (Termination and Severance of Employment) entitlements for employees of the replaced provider. If an owner or manager of the premises fails to provide the required information, an employment standards officer could issue a compliance order under s. 108 and/or a notice of contravention under s. 113. There is no authority however for issuing a compensation order under s. 104 in favour of a new building services provider where the new provider suffers damages as a result of a failure on the part of the owner or manager to provide information under s. 77(2).
Section 3(3) provides that if the employee’s hours of work vary from week to week, the owner or manager shall provide the employee’s non-overtime hours for each week worked in the 13 weeks before the "request date".
This requirement provides a potential new provider or the new provider with the necessary information to estimate the extent of the potential liability for Part XV (Termination and Severance of Employment) entitlements of replaced provider employees who do not have a regular work week, by averaging out each employee’s earnings over the 13 weeks prior to the request date.
Note that if such employees were not hired by the new provider, the new provider would subsequently be required to average the employee’s regular wages earned per week over the weeks worked in the twelve-week period prior to the changeover date in order to calculate the actual Part XV (Termination and Severance of Employment) entitlements pursuant to s. 61(1.1) and ss. 65(4) and (6) of the Act, if applicable
Section 3(4) establishes what weeks are excluded in the 26-week period referred to in paragraph 7 of s. 3(1). For a further discussion of paragraph 7, see subsection (1) above.
Section 3(5) establishes what weeks are excluded in the 26-week period referred to in paragraph 7 of s. 3(1). For a further discussion of paragraph 7, see subsection (1) above.
The information required to be given by the building owner or manager is set out in s. 3(1) and s. 3(3) to s. 3(5) of O Reg 287/01.
O Reg 288/01 sets out exemptions from the termination and severance provisions. It also deals with several matters relating to notice of termination/termination pay, including “mass termination” notice requirements, the method of giving notice, the calculation of “period of employment” and the provision of temporary work after the termination date set out in a notice has arrived.
Construction industry
is then defined in s. 1 of O Reg 285/01 as follows:
The definitions of construction industry
and construction employee
are substantially the same in scope as the construction industry
definition in s. 1(1) of the Labour Relations Act, 1995, SO 1995, c 1, Sch A, and the "employee" definition in the Construction Industry part of that Act.
The definition of construction employee
in O Reg 285/01 produces a significantly different result than that achieved under the former Employment Standards Act, in that it now includes employees who work off-site (either in whole or in part), if the off-site employees are "commonly associated in work or collective bargaining" with a construction employee
who is employed in a construction industry
activity at the work site. In considering the application of the construction exemption from notice of termination, the Board concluded that an off-site employee who spent about half of her time performing office manager duties and the rest in "limited" contact with on-site staff (for the purposes of scheduling them, managing their invoices and ensuring communications with the employer’s managers) was not "commonly associated in work" with on-site construction employees and so was entitled to termination pay. The Board noted that its decision was consistent with the conclusions of the Board in other cases that considered what it meant to be "commonly associated in work" with on-site construction employees under both the Labour Relations Act, 1995 and the Employment Standards Act, 2000. See 1703171 Ontario Inc. o/a The Construction Group and Bath Solutions v Russo-Janzen, 2016 CanLII 8145 (ON LRB).
The definition of construction employee
includes repair work but generally excludes maintenance work.
Maintenance involves the preserving of the functioning of a system, whereas repair involves restoration of a system to a functional state. However, the dividing line between maintenance and repair is not always clear, particularly since some maintenance activity may involve procedures that bear a close resemblance to repair (e.g., replacing worn or broken components). In determining whether an employee should be considered to be engaged in repair or in maintenance, one should look to the activity in which the employee spends the majority of his or her working hours. See Stearns Catalytic Ltd. v Everingham (September 3, 1986), ESC 2166 (Kerr), Beaver Engineering Limited v Lightfoot and Woods (April 26, 1985), ESC 1840 (Franks) and Warren v Rexway Sheet Metal (January 10, 1995), ESC 95-06 (Palumbo).
construction employeeexemptions
Although maintenance work is generally not considered to constitute repair work or some other subcategory of construction, road maintenance employees are nevertheless considered to fall within the definition of construction employee
in O Reg 285/01 because of the reference in the definition of construction industry
to the "constructing [of] … roads" . There is no conceptual distinction between the "constructing of roads" and "road building", and the term "road building" is defined in s. 1 of O Reg 285/01 to include the maintenance of roads. Thus, as a general rule, an employee engaged in the maintenance of roads is exempt from any employment standard from which a construction employee
is exempt, such as the standard limiting hours of work (s. 17 of the Employment Standards Act, 2000).
There is an exception to this general rule, however, in the case of notice of termination.
While "construction employees" are not entitled to notice of termination/termination pay by virtue of paragraph 9 of s. 2(1) of O Reg 288/01 (which exempts "construction employee[s]"), the Program takes the position that employees engaged in the maintenance of roads are entitled to termination notice/pay.
The basis for this position lies in the principle of statutory interpretation that a specific provision overrides a more general provision. The severance pay exemptions in s. 9(1) of O Reg 288/01 refer not only to a construction employee
(in paragraph 7) but also to an "employee engaged in the on-site maintenance of . . . roads" (in paragraph 8). It follows from this that for purposes of O Reg 288/01, the maintenance of roads is to be regarded as an activity distinct from the construction of roads (as otherwise there would be no need for paragraph 8). And if that is the case, then since s. 2(1) of O Reg 288/01 exempts a construction employee
from entitlements to notice but says nothing about an employee engaged in maintenance, an employee engaged in road maintenance is entitled to notice.
The definition of construction industry
in O Reg 285/01 explicitly refers to sewers and watermains; therefore, employees engaged in laying, altering or repairing sewers and are exempt from those standards to which the construction employee
exemption applies:
They are also subject to the special overtime pay threshold of 50 hours - see O Reg 285/01, s. 9(2).
Employees who are engaged in sewer and watermain maintenance do not fall within the construction employee
definition, as maintenance does not generally fall within the scope of activities referred to in the construction industry
definition (maintenance of roads being the sole exception, because of the "road building" definition).
Accordingly, employees who maintain sewers and watermains are not subject to the construction employee
exemptions.
However:
This section sets out the exemptions from the termination of employment provisions in ESA Part XV. Subject to s. 2(2) and s. 2(3), the employees listed in this section are not entitled to notice of termination or termination pay under Part XV. A discussion of each exemption appears below.
Section 2(1) paragraph 1 relieves employers from the obligation to provide notice of termination or termination pay to employees who were employed for a definite term or specific task. This exemption is in recognition of the fact that employees who are hired for a definite term or to complete a specific task are, at the time of hiring, aware of when their employment will end and therefore they have already received the equivalent of notice.
Note, however, that if the assignment of an assignment employee performing work for a client of a temporary help agency was estimated to be three months or more and the assignment is terminated prior to the end of that estimated term, the temporary help agency may have an obligation to provide one week’s notice of the termination of the assignment or pay in lieu of notice pursuant to s. 74.10.1. This is not notice of termination of the employment relationship with the temporary help agency but rather notice of termination of an assignment to perform work.
For the exemption in paragraph 1 of s. 2(1) to apply, the employee must be hired on the basis that their employment is to terminate either,
For the definite term part of this exemption to apply, the employee must have an agreement, either orally or in writing, which specifies the exact date the employee's contract of employment is to end.
For the specific task part of this exemption to apply, the employer and the employee must have an agreement, either orally or in writing, that describes the task with enough specificity that the employee is able to determine when the task will be completed. For example, an employee who is hired to make 100 widgets will know when the task will be completed.
An employer cannot put an employee who is not a term or task employee on a term or task arrangement as a means of terminating the employee without providing termination notice or pay, since to do so would be to undermine the purpose of Part XV and this exemption. This is so even if the employee agrees to such an arrangement, since ESA Part III, s. 5 prohibits an employee from waiving their rights under the ESA 2000. For example, if a ten-year employee agrees to go on a four-week definite term contract and the employer terminates the employment of the employee at the end of the four-week period, the exemption will not apply. The employee will be entitled to eight weeks' notice or pay in lieu thereof. Note though that if the definite term arrangement was reduced to writing and a copy given to the employee, the employer may receive credit for the four weeks' actual written notice the employee received.
The exemption in paragraph 1 must be read in conjunction with s. 2(2), which states:
This section provides that the term or task exemption in paragraph 1 of s. 2(1) will not apply to term or task employees if any of the following circumstances are present:
Pursuant to s. 2(2)(a), the term or task exemption will not apply if the employment terminates before the expiry of the term or completion of the task and the employee will be entitled to one week of notice of termination or pay in lieu. This clause will apply where, for example, an employee is employed for a six-month term but the employer decides to terminate the employee's employment after the fourth month.
The exemption can only apply where the employee is employed for the duration of the term or until the completion of the task. This is consistent with the rationale for the term or task exemption. If the employer terminates the employee's employment before the end of the agreed upon term or the completion of the task, the basis for the exemption - the employee knowing at the outset when their employment will end - is lost.
Section 2(2)(b) means that the term or task exemption in paragraph 1 of s. 2(1) will not apply if:
Where the employee is employed for more than one definite term and the terms are "back to back", i.e., continuous, it is Program policy that the terms should be added together when determining whether the 12-month limit in 2(2)(b) has been exceeded.
Where, however, the terms are not back to back, the terms will not be added together when determining whether the 12-month limit in clause (b) has been exceeded. This is so even if the terms are separated by less than 13 weeks. In this regard, see Metropolitan Toronto Board of Commissioners of Police v Ministry of Labour (October 17, 1994), ESC 94-178 (Muir). It should be noted that although the court did not provide much reasoning in its decision on this particular point, it upheld the referee's decision as correct and therefore it constitutes a precedent that the Program follows.
It should be emphasized that despite Program policy not to add terms that are not "back to back" together for the purpose of determining whether the 12-month limit has been exceeded, the terms will be added together for the purpose of determining the period of employment in ESA Part XV, s. 57 if they are separated by less than 13 weeks – see O Reg 288/01, s. 8(2). This would be relevant, for example, if the employee's employment was terminated before the end of the subsequent term, in which case the term or task exemption would not apply and the employee would be entitled to termination notice or pay based on his or her period of employment.
Section 2(2)(c) stipulates that the term or task exemption in paragraph 1 of s. 2(1) will not apply if the employee continues to be employed for three months or more after the definite term or the specified task for which the employee was hired has either expired or is completed.
For example, an employee is employed for a six-month term and is employed on an open-ended arrangement for an additional four months before having their employment terminated. The term or task exemption will not apply to this employee, and they will be entitled to one week of termination notice or pay.
The question arises as to whether s. 2(2)(c) applies to a situation where, instead of being employed on an open-ended arrangement after the end of the original definite term, the employee is put on a second definite term contract that lasts more than three months past the end of the first contract. It is Program policy that s. 2(2)(c) applies in this situation. This policy prevents an employer from employing an employee for a series of very short, e.g., one-month contracts for a period of less than 12 months and then terminating them without notice or pay in lieu. In that situation, the employee loses the certainty of knowing when their employment will end and should therefore be entitled to the benefit of the notice of termination or pay in lieu provisions.
Pursuant to s. 2(1) paragraph 2, an employee who is on a temporary lay-off is not entitled to notice of termination or termination pay in lieu. Temporary lay-off is defined in ESA Part XV, s. 56(2).
Pursuant to s. 2(1) paragraph 3, an employee who has been guilty of wilful misconduct, disobedience or wilful neglect of duty that is not trivial and that has not been condoned by the employer is not entitled to notice of termination or pay in lieu.
The rationale for this exemption is the view that an employer who terminates an employee because the employee was guilty of wilful misconduct, disobedience or neglect of duty should not be obliged to provide that employee with either notice of termination or pay in lieu of notice. See Sacco v MMCC Solutions Canada Company (Teleperformance Canada), 2015 CanLII 82037 (ON LRB) for a discussion of the standard that must be met in order for this exemption to apply.
This exemption will apply only if all of the following criteria are met:
Each criterion is discussed in more detail below.
For information on the application of the wilful disobedience exemption where an employee is not vaccinated against, or tested for, COVID-19 in accordance with the employer’s policy, see “ESA Termination and Severance Liabilities Where an Employee is Not Vaccinated Against or Tested For COVID-19”.
As with any exemption from a minimum standard, the onus is on the employer to demonstrate on a balance of probabilities that the exemption applies. As the following discussion demonstrates, this exemption is narrower than the just cause concept applied in the common law and in collective agreement disputes. In other words, an arbitrator or a judge may find that there was just cause to dismiss an employee, but this does not necessarily mean that the exemption in paragraph 3 of s. 2(1) applies.
The key element to this exemption is that the actions or omissions must be wilful on the part of the employee. Although the word "wilful" does not appear before the word "disobedience", it is clear that disobedience involves an element of wilfulness. See, for example, Superior Propane Inc. v Cunningham (August 13, 1988), ESC 2364 (Haefling). Thus the employer must demonstrate that there was wilfulness on the part of the employee, whether it is alleging misconduct, disobedience or neglect of duty.
Ordinarily, wilful means that the employee intended the result that came to pass. Thus, poor work or conduct that is accidental or involuntary will generally not be considered to be wilful. However, an employee who is reckless in their conduct may be guilty of wilful misconduct if that employee knew or ought to have known that their conduct would cause the result that came to pass.
The following are some examples of conduct that have been found to be wilful misconduct. The list is illustrative only and is not meant to be exhaustive.
If the employee's drinking is due to alcoholism, then the employee's behaviour is due to a recognized handicap and may not be wilful. However, if the employee has been prescribed medicine (e.g., Antabuse) to prevent alcoholism, but does not take it, the employee may be guilty of wilful misconduct since the failure to take the medicine may be in itself wilful. In this regard, see Facelle Company Limited v Hoar and Odo (March 31, 1989) ESC 2492 (Gorsky).
Where the employer seeks to rely on a failure to follow company policy as grounds for wilful misconduct, the Program's policy position is that the following criteria (most of which were also referenced in the above-noted cases) should be satisfied:
Note, however, that there won’t be wilful misconduct if an employee who is not in a position of trust has a passing economic relationship with a competitor in an area entirely outside of the employee and employer's normal line of work, in which no trade secrets or confidential information is disclosed. See for example Van Noort v 566355 Ontario Ltd o/a K.J. Marketing Services (February 26, 1998), 2677-96-ES (Goodfellow) where the employer and its competitor were in the electrical equipment sales business and the employee built a washroom for the competitor at a time when he was not required by his employer to be at work. Note also that merely intending to join a competitor (for example, the employee has accepted a job offer with a competitor, but has not yet begun working for the competitor, and provided notice of resignation to the employer) does not amount to wilful misconduct. If, on the other hand, the employee begins to disclose confidential information to the competitor, that will be wilful misconduct. Likewise, it is the Program's position that so long as confidential information is not being disclosed to the employee's spouse, there is no conflict of interest if the employee has a spouse who works for a competitor.
As mentioned above, although the word wilful does not appear before the term disobedience in the regulation, disobedience necessarily involves an element of wilfulness.
In order for there to be disobedience within the meaning of the exemption, the Program's position is that the following criteria should be satisfied:
Note that these are the same factors that apply when determining whether there is wilful misconduct due to a breach of company policy.
For information on the application of the wilful disobedience exemption where an employee is not vaccinated against, or tested for, COVID-19 in accordance with the employer’s policy, see “ESA Termination and Severance Liabilities Where an Employee is Not Vaccinated Against or Tested For COVID-19”.
Similar considerations apply with respect to neglect of duty as those that apply with respect to misconduct (see the discussion of wilful misconduct, above), except that the former concept focuses on the failure to do something, rather than the doing of something. Typically, cases in which wilful neglect of duty is found to be present are ones where the employee refused to report for work, often after being refused permission to take a holiday or after being required to work overtime. See for example Perly's Maps Limited v Lincoln (July 17, 1980), ESC 816 (Bigelow). Other instances in which wilful neglect of duty has been found to have been present include non-innocent absenteeism and tardiness - see for example Hunter v Ertel Manufacturing Corporation of Canada Ltd. (January 31, 1995), ESC 95-39 (Faubert). However, as mentioned above, the exemption is narrower than the just cause concept applied in the common law and in collective agreement disputes. While an arbitrator or judge may find that there was just cause to dismiss an employee, that does not necessarily mean that the exemption in paragraph 3 of s. 2(1) applies.
For example, see K & R Advertising Limited v Wojick (January 12, 1981) ESC 934 (Bigelow) where the referee found that the employee "was lazy; she was slovenly; she was inconsistent; she was unreliable; she was irresponsible; she was just about everything that a competent secretary should not be. She was unquestionably discharged for just cause. But I cannot go so far as to say that she was guilty of wilful neglect of duty."
In order for the exemption to apply, the wilful misconduct, neglect of duty or disobedience must not be trivial, i.e., unimportant or insignificant. Trivial acts of wilful misconduct, neglect of duty or disobedience will not serve to disentitle an employee from notice of termination or termination pay.
In order for the exemption to apply, the employee's behaviour must not have been condoned by the employer. In this discussion, the reference to behaviour means wilful misconduct, wilful neglect of duty or wilful disobedience that is not trivial.
Condonation exists in situations where the employer knows about the employee's behaviour but does not act on it, thereby giving the employee the impression that the behaviour is not serious enough to warrant termination. If such condoned behaviour is repeated by the employee, the employer is generally prevented from relying on that recurrence in order to terminate the employee without notice or pay in lieu. The employer can avoid the inference of condonation by warning the employee that such behaviour is unacceptable and that a repeat of it will result in termination. If the behaviour concerning which the employee was previously warned reoccurs, this reoccurrence may be relied on as a "culminating incident" for which the employee may be terminated without notice or pay in lieu. The uncondoned culminating incident also allows the employer to bring into consideration other behaviour of the employee that was previously condoned by the employer. See Cool and Cool c.o.b.a. Timmons Auto Wreckers & Salvage v Duncan (July 29, 1981), ESC 1048 (Sheppard).
Immediate action (e.g., a warning or other disciplinary action) by the employer in response to the employee's conduct is not always necessary to avoid condonation. For example, condonation will not be found where the supervisor responsible for such action is not available until some time has elapsed after the incident, where the employer waits to act until after the work day is over in order to avoid a disruption of operations, or where the employer takes a reasonable amount of time to conduct an investigation of an employee who is suspected of misconduct. In this regard, see Montgary Food Enterprises Inc. o/a Kipling's Restaurant (March 5, 1992), ESC 2996 (Novick) and CCL Custom Manufacturing v Barrett, 2000 CanLII 13149 (ON LRB). However, where there was no reason for the failure to take immediate action, there will generally be condonation. See for example Lighthouse Inn Operations v Mosey (November 24, 1997), 1369-15-ES (ON LRB).
After-acquired information can be used in determining whether the exemption in paragraph 3 of s. 2(1) applies. The fact that the employer discovered the employee's behaviour after the termination is irrelevant, since grounds for terminating the employee without notice or pay in lieu would have existed at the time of the termination. In this regard, seeLake Ontario Portland Cement Co. Ltd. v Groner, [1961] SCR 553, 1961 CanLII 1 (SCC).
Section 2(1) paragraph 4 provides that, except where the impossibility or frustration is the result of the employee's illness or injury, an employee whose contract has become impossible to perform or is frustrated by a fortuitous or unforeseeable event or circumstance is not entitled to notice of termination or pay in lieu.
This section must be read in conjunction with s. 2(3), which reads:
The effect of the exemption is to relieve the employer from the obligation to give notice of termination or termination pay where there is a supervening unforeseeable event that strikes at the very root of the contract that is not the fault of the employer and that is not provided for in the contract itself.
The rationale for this exemption is the recognition that employers cannot give advance notice of termination where the termination is caused by events that the employer cannot reasonably be expected to anticipate or foresee. It is also consistent with the common law view that frustration of contract brings the contract to an end automatically by operation of law. Where frustration of the employment contract occurs, the common law does not regard the employer as having terminated the contract.
It should be noted, however, that the exemption will only apply in rare circumstances and, generally speaking, employers' arguments that the contract of employment was frustrated or had become impossible to perform have been met with some considerable skepticism by tribunals.
As with any exemption from a minimum standard, the onus is on the employer to establish on a balance of probabilities that the exemption applies.
Prior to the amendments made by O Reg 549/05, which, among other things, brought in s. 2(3), the exemption in paragraph 4 of s. 2 (and that in s. 9 regarding severance entitlements) of O Reg 288/01 purportedly provided that, subject to the Human Rights Code, RSO 1990, c H.19 (the "Code"), an employer could terminate (or sever) the employment of an employee whose employment contract was "frustrated" due to illness or injury without being required to provide notice of termination or severance pay. In other words, the exemptions purportedly applied in situations in which the contract of employment had become impossible to perform or had been frustrated as a result of injury or illness on the part of the employee, provided that the employer had complied with the duty of reasonable accommodation under the Code.
However, on May 4, 2005, in Ontario Nurses' Association v Mount Sinai Hospital, 2005 CanLII 14437 (ON CA) the Ontario Court of Appeal struck down the severance pay exemption under the former Employment Standards Act. The Court found that the exemption was unconstitutional as it violated s. 15 of the Charter of Rights, in that it was discriminatory on the ground of disability, and could not be saved as a reasonable limit under s. 1 of the Charter. Although the wording of the notice and severance pay frustration exemptions under the ESA 2000 is different from that of the severance pay exemption in the old Act, in substance the exemptions are to the same effect. While the severance pay exemption in the former Employment Standards Act was not expressly made subject to the Code, it was nonetheless considered to be so subject by virtue of the provision in the Code that gives it primacy over other legislation in the event of a conflict.
Accordingly, to reflect the ruling in the Ontario Nurses' Association v Mount Sinai decision, O Reg 288/01 was amended by O Reg 549/05 to indicate that the exemptions for impossibility of performance or frustration do not apply where the impossibility or frustration is the result of employee injury or illness. See subsection (3) below and O Reg 288/01, s. 9(1) para. 2.
It should be noted that it is now irrelevant so far as the ESA 2000 is concerned whether a contract of employment has been frustrated as a result of disability; the crucial point is whether the employer has terminated or severed the employee's employment. Because the frustration exemption is no longer available to the employer in cases where the contract was allegedly frustrated by the employee's disability, there is no need for an officer to attempt to determine whether frustration occurred; the only thing that the officer needs to determine is whether the employer terminated or severed the employee's employment, unless, of course, some other exemption might apply.
Terminating and/or severing the employment relationship does not necessarily mean that the employer must purport to end the employment relationship expressly. The employer may terminate and/or sever the relationship with either a statement or an action that indicates the employer regards the employment relationship as having ended. For example, in Barrette v Rainbow Concrete Industries Ltd., 2006 CanLII 11057 the Ontario Labour Relations Board the employer was found to have terminated the employment relationship when it sent the employee a pension form with several references to termination in it and which was intended to remove the applicant as a pension plan member when the only way to do so was by termination of employment or resignation. In this case the employer was fully aware that the employee had no intention of resigning.
In Fleetwood Canada Ltd. v Burchall, 2006 CanLII 34100 (ON LRB) the Board found that the employer terminated the employment of an employee with a letter that was not worded as a dismissal but which referred to the fact that its obligation to re-employ him under the Workplace Safety and Insurance Act, 1997, SO 1997, c 16, had expired, and that he had therefore ceased to be an employee. However, there must be a termination or severance by the employer in order for there to be an entitlement; the mere fact that it appears to be extremely unlikely or even certain that the employee will not be returning to work is not sufficient if the employer takes no step, whether expressly or by implication, to indicate that it is ending the employment relationship. Note that some court and arbitrator decisions on this point are contrary to the Program’s position and should not be followed (for example, St. Joseph's General Hospital v Ontario Nurses' Association, 2006 CanLII 35191 (ON LA), Hoekstra v Rehability Occupational Therapy Inc., 2019 ONSC 562 (CanLII), and Estate of Cristian Drimba v Dick Engineering Inc., 2015 ONSC 2843 (CanLII).) The OLRB has consistently interpreted the termination and severance pay provisions of the ESA as requiring an actual terminating event on the initiative of the employer prior to a finding that an employment contract has been terminated due to frustration. The OLRB interpretation is consistent with a plain reading of the relevant provisions of the ESA. (See for example: Ardies v 1650691 Ontario Inc. (Chip N' Charlie's Bar & Eatery), 2015 CanLII 49514 (ON LRB); Barrette v. Rainbow Concrete Industries Ltd., 2006 CanLII 11057 (ON LRB); Fleetwood Canada v. Burchall OLRB [2006] 2006 CanLII 34100 (ON LRB); Nour Trading House Inc. v. Lam, 2006 CanLII 41447 (ON LRB); MacDonald v. Zellers Inc., 2005 CanLII 4315 (ON LRB); Velovski v. Woods Industries (Canada) Inc., 2005 CanLII 8257; Chandoo v. Sobeys Ontario Division, 2002 CanLII 35376 (ON LRB); and Glick v. Burke, 2000 CanLII 12787 (ON LRB).
Because O Reg 549/05 was filed on October 28, 2005, and was published in the November 12th, 2005 issue of the Ontario Gazette, an issue arose as to whether the frustration exemptions as they stood prior to the amendments should still be applied in cases where the employee's employment was terminated or severed prior to November 12, 2005 (or October 28, 2005, if the employer knew about the amendments).
The position of the program is that the amendments to the frustration exemptions did not change the law. The amendments simply reflected the Court of Appeal's decision in Ontario Nurses' Association v Mount Sinai - in other words, the amendments brought the text of the regulation into line with what was already the law, as stated by the Court. For this reason, where an employment contract was frustrated as a result of injury or illness, the Program proceeds on the basis that the frustration exemptions cannot be applied - even if the termination or severance occurred before the amendments to the exemptions were filed or published.
In determining the applicability of the frustration and impossibility exemption in non-disability situations, it is important to bear in mind three general principles.
As well, where the allegedly frustrating event was something personal to the employee, it is Program policy that factors such as the employee's length of employment, whether or not they were a "key" employee, the length of the employee's absence from work or inability to work, and whether the employment would have been expected to continue indefinitely had it not been for the occurrence of the allegedly frustrating event should all be taken into account. If the employee had been employed for a lengthy period and their employment would have expected to continue had the allegedly frustrating event not occurred, that tends to argue against a finding of frustration. On the other hand, if the employee is a key person in the employer's operation and the absence is extremely lengthy, these factors tend to argue in favour of a finding of frustration. Also relevant is what has the employer's past practice been in response to similar situations; if the employer did not treat the contract as having been frustrated in similar cases in the past, that makes a finding of frustration less likely.
The question may arise as to whether an employment contract would be frustrated or rendered impossible to perform where the employee has been on a series of Part XIV statutory leaves for a period of some years. Given that the employee is exercising a statutory right, it is Program policy that the contract would not be frustrated or rendered impossible to perform in these circumstances.
Set out below are some situations where there could be a possibility that the contract of employment should be regarded as having been frustrated or become impossible to perform. These are provided as examples; the list is not intended to be exhaustive.
Note that where the employee entitlement in issue is severance pay, rather than notice of termination or termination pay, the employer cannot rely on the exemption if the frustration or impossibility is the result of a permanent discontinuance of all or part of the employer’s business because of a fortuitous or unforeseen event. See O Reg 288/01, s. 9(2)(a)(i).
Where an employer is forced to restrict its activities or discontinue its business because of a change in the law, the contract of employment may be frustrated or impossible to perform. For frustration to be found on the basis of a change in the law, generally the new law:
A question arose during the COVID-19 pandemic as to whether the frustration exemption applied on the basis of a change in the law where a business was forced to temporarily close or temporarily restrict its activities due to an order under the Emergency Management and Civil Protection Act (EMCPA) or Reopening Ontario (A Flexible Response to COVID-19) Act, 2020 (ROA). At the time of writing, the requirements of the EMCPA and ROA were all temporary. As such, at the time of writing, the second criterion to establish frustration of contract on the basis of a change in the law is not met due to the EMCPA or ROA ordersand it is therefore Program policy that frustration of contact on the basis of the EMCPA or ROA orders is not established*. (Where it is determined that one of the criteria set out above is not met, it is not necessary to determine whether the other two criteria would have been met in the circumstances).
*Although the specifics of individual employment contracts on matters such as whether the contract was for a definite or indefinite term and the timing of the change in the law vis-à-vis the start of the employment contract are part of the context when determining whether the change in the law is temporary, the Program considers those factors not to be pertinent in the scenario of EMCPA/ROA orders and the ESA context where an employee must be continuously employed for three months in order to have termination entitlements, and where an exemption from termination entitlements applies to employees who are employed for a definite term or to complete a specific task.
Note that where the employee entitlement in issue is severance pay, rather than notice of termination or termination pay, the employer cannot rely on frustration because of a supervening change in the law that results in the permanent discontinuance of its business; see O Reg 288/01, s. 9(2)(a)(i).
Where the employer's business premises are destroyed by "an act of God", or by other means such as terrorism, war or arson so that the employer is unable to carry on business, there will generally be frustration since such events are generally considered to be unforeseeable (even if the employer has insured itself against these losses). Other factors mentioned earlier might, however, prevent frustration from being found in these circumstances, for example, if the employer commits arson on its own premises, the allegedly frustrating event would have occurred as a result of fault of the employer, and the employer could not therefore rely on the exemption.
A question arose during the COVID-19 pandemic as to whether the pandemic constituted an “act of God” such that it would trigger the frustration exemption. Although some might argue that the pandemic itself may be an unforeseeable event, it is Program policy that the focus of the inquiry for frustration purposes is on the consequences flowing from the pandemic that were responsible for the terminations (e.g. economic downturn) and whether those consequences amount to frustration of contract, rather than the focus being on the pandemic itself. To that end, the discussion under the “Business Failure” heading below equally applies here: in light of the situation at the time of writing, it is Program policy that frustration is not established on the basis of business failure or economic conditions created by the pandemic.
Note that where the employee entitlement in issue is severance pay, rather than notice of termination or termination pay, the employer cannot rely on frustration because its business is permanently discontinued because of the destruction of its business; see O Reg 288/01, s. 9(2)(a)(i).
Where the employer loses a business licence and is thereby unable to continue operating, this may lead to frustration unless the employer knew or ought to have known of the risk that the licence would be lost or not renewed. For example, in Lakeshore Pubs Ltd. o/a Kelly's Keg'n Jester v Reardin (March 16, 1990), ESC 2650 (Baum) an employer had a concession agreement at Ontario Place that was not renewed. The employer subsequently terminated the employment of the employees at that location, as it was no longer able to carry on a business at the site. In this instance, it was determined that the employer could not rely on frustration of contract because it was found that the employer was fully aware of the possibility that the concession agreement might not be renewed. The employer was found to have known of the risk that staff would not be needed if its application for concession renewal failed and therefore could not resort to the argument of frustration of contract to avoid its obligations under the former Employment Standards Act. In addition, the employer may be prevented from relying on frustration in this circumstance if the loss of the licence was due to its own fault.
Frustration may also occur where the employee loses a licence (such as a driving licence or a professional licence) that is necessary for them to carry out the duties of the job. In that situation, the employer may rely on frustration, so long as the loss of the licence was not the employer's fault.
Note that where the employee entitlement in issue is severance pay, rather than notice of termination or termination pay, the employer cannot rely on the frustration exemption if the loss of an essential licence causes it to cease to carry on business; although the loss would be considered to frustrate the employment contract, it also represents the permanent discontinuance of all or part of its business and so the exemption is inapplicable by virtue of s. 9(2)(a)(i) of O Reg 288/01.
There are a number of decisions under the former Employment Standards Act that determined that an employee who gives notice of resignation and indicates that they intend to work for a competitor of the employer (or set up a business in competition with the employer) gives rise to a frustration of the employment contract – see Avco Financial Services v Morabita (June 12, 1973), ESC 187 (Learie) and Yurman v J&M Tire Sales Inc. (December 14, 1995), ESC 95-236 (Wacyk). However, the Program's policy is that these decisions should not be followed. These situations do not result in the contract being frustrated. Rather, the consideration should be whether the employee has engaged in willful misconduct. See Nidd v Cartier Supply & Rentals Ltd., 2000 CanLII 12058 (ON LRB) and MTC Leasing Inc. and the discussion at s. 2(1) para. 3 above.
Referees have found that in some cases where an employee was imprisoned for a criminal offence, the contract of employment was frustrated or impossible to perform because the imprisonment rendered the employee unable to perform their job duties: see for example Caland Ore Company Limited v Connors (January 8, 1980), ESC 684 (Aggarwal), a decision under the former Employment Standards Act. However, the determination of whether the employment contract is frustrated will depend on a number of factors such as the length of the incarceration, the employee's period of service prior to the incarceration, and whether the employee was a key person.
Where the sole proprietor of a business dies, the contract will generally be considered as frustrated, except where an executor (or where the individual dies intestate, personal representative) of the sole proprietor's estate carries on the business. See Estate of Brinklow formerly o/a Brinklow's Body Shop v Anderson et al (January 16, 1988), ESC 235 (Haefling) and Robitaille v J.B. Truck Repair Service & Sale (November 14, 1994), ESC 94-203 (McKellar). Note, however, that the death of an employer will not trigger a similar exemption to severance pay – see the discussion of O Reg 288/01, s. 9(2)(a)(ii).
Note that where the employee entitlement in issue is severance pay, rather than notice of termination or termination pay, the employer's estate cannot rely on the frustration exemption because of the employer's death – see O Reg 288/01, s. 9(2)(a)(ii).
The possibility that strikes or lock-outs might occur and disrupt the employer's business is not unforeseeable and therefore these events will not generally lead to a finding of frustration or impossibility. Note, however, that if an employee's employment is terminated during or as a result of a strike or lock-out at the place of employment, the exemption in paragraph 8 of s. 2(1) of O Reg 288/01 will apply – see the discussion of s. 2(1) para. 8 below. Also see O Reg 288/01, s. 9 para. 1 for a somewhat similar exemption from the severance pay requirements.
The failure of a business due to such reasons as an economic downturn, reduced revenues or an inability to obtain financing will generally not support frustration or impossibility since these events are not unforeseeable circumstances. The inability to obtain financing, or poor or uncertain economic conditions, including those that lead to a bankruptcy, have historically not been considered to constitute frustration, since economic downturns are generally seen as reasonably foreseeable future events when entering into employment contracts. See for example Iroquois Hotel (London) Limited v Diorio et al (September 25, 1975), ESC 290 (Murphy).
Similarly, an employer’s voluntary decision to discontinue a business for economic reasons or to file for bankruptcy have historically not been considered to constitute frustration of employment contracts, since those are financial decisions and employment contracts are not frustrated simply because the employer is unprofitable or is insolvent.
A question arose during the COVID-19 pandemic as to whether the frustration exemption applied where the business failed because of economic conditions created by the pandemic. Depending on the length of the pandemic and its eventual impact on the economy, a distinction may be drawn in the future between an economic downturn that is normally foreseeable and that does not trigger the frustration exemptions, and an unforeseeable global emergency that creates an economic disaster and that could trigger the exemption. In light of the situation at the time of writing, however, it is Program policy that frustration is not established on the basis of business failure caused by the economic conditions created by the pandemic.
The death of the employee will frustrate the employment contract. This means that the employee's estate will have no entitlement to termination pay where the employment relationship ended with the employee's death. Thus, for example, the estate will not be entitled to termination pay even if the employee had received notice and died before the notice took effect, nor will the estate be entitled where the employee was part of a group of employees whose employment the employer was about to terminate if the employee's death intervenes.
Note that where the employee entitlement in issue is severance pay, rather than notice of termination or termination pay, the employer cannot rely on the frustration exemption if the employee died after receiving a notice of termination – see O Reg 288/01, s. 9(2)(a)(ii).
Pursuant to s. 2(1) paragraph 5, an employee whose employment is terminated after they refuse an employer's offer of reasonable alternative employment is not entitled to notice of termination or pay in lieu.
The effect of this exemption is to relieve the employer from the obligation to give notice of termination or termination pay where the employee refuses continued employment with the employer when the employer is offering reasonable alternative employment. As with all exemptions from minimum standards, the onus is on the employer to establish on a balance of probabilities that the exemption applies.
The rationale for this exemption is that the ESA 2000 of refusing an offer of reasonable alternative employment is tantamount to resigning.
In determining whether an employee has refused reasonable alternative employment, consideration should be given to the following five points:
In order for there to be a refusal, the employer must first make a clear and unequivocal offer of reasonable alternative employment to the employee. See Lauderdale Car Cleaners (1965) Limited v Metauro (March 5, 1992), ES 24/92 (Randall), a decision under the former Employment Standards Act.
The exemption uses the phrase "with the employer". The use of this phrase requires that the offer be for reasonable alternative work with the employer. An offer of reasonable alternative employment with a separate employer is not sufficient, even if that separate employer is a purchaser of the employer's business. However, an offer of employment from a "related employer" as defined in ESA Part III, s. 4 would satisfy this criterion.
The exemption applies only if the employee's employment is terminated "after" the employee has refused a reasonable alternative offer of employment. Accordingly, the employer must make the offer of reasonable alternative employment before the termination of the employment relationship in order for this exemption to apply.
In order for there to be a refusal, the employee must be able to perform the work that is offered. There is a distinction between a refusal to do something, on the one hand, and an inability to do something, on the other hand. An employee who is unable to do something (for example, through lack of necessary credentials or disability) cannot be said to have refused to do it. Refusal involves declining to do something that one is able to do. Black's Law Dictionary states: ""Fail" is distinguished from "refuse" in that "refuse" involves an act of the will, while "fail" may be an act of inevitable necessity."
In determining whether the alternative employment offered by the employer was reasonable, consideration must first be given to whether or not there was an actual or implied term of the contract that allowed the employer to make changes to the terms of employment. In that case, an employee cannot argue that such changes are unreasonable. See also the discussion of constructive dismissal at ESA Part XV, s. 56.
Barring a situation where the changes to the terms of employment are made in accordance with actual or implied terms in the contract, the primary factor in determining whether the alternative work offered to the employee is reasonable will be the rate of pay. However, other factors may be relevant as well, including benefits, location, hours and schedule of work, "perks", quality of working environment, degree of responsibility, job security and possibility of advancement. The question to be asked is would a reasonable employee in the circumstances of the employee in question consider the offer to be reasonable.
This is the most important of all the factors to be examined in considering whether or not the offer was reasonable. Generally speaking, offers of employment that entail pay cuts of less than 10 per cent will probably be considered as reasonable, although each case must be examined on its own merits, and the pay cut needs to be viewed in the context of any other changes to the employee's employment, e.g., duties, location etc. One decision from the Office of Adjudication indicated that a pay cut of 12.6 per cent was reasonable – see Eng v Trigraph Inc. (March 12, 1993), ES 93-47 (Blair), a decision under the former Employment Standards Act. However, this case was unique on its facts in that most of the other employees accepted a much larger cut of 20 per cent. The referee noted this in determining that the pay cut was reasonable. The test of whether the cut is reasonable is what a reasonable employee in the circumstances would think of it, and the inference in the above-noted case was that the claimant was acting in an unreasonable manner in refusing to go along with the new arrangement.
When assessing whether or not the offer is reasonable, it is appropriate to consider the overtime possibilities available to the employee. See for example Rowlands v Custom Design Installation Ltd. (April 5, 2000), 4073-98-ES (ON LRB), a decision under the former Employment Standards Act, where the Board held that the employer's offer of a job that had little possibility of overtime was not reasonable when the employee had previously performed overtime on a regular basis.
Benefits are to be included when calculating the amount of the pay cut. Some benefit packages are worth 15 per cent to 25 per cent of the employee's total remuneration. If the offer does not include such a package, then the offer may not be reasonable even though the basic wage or salary would remain the same.
In determining whether the offer was unreasonable, the officer should look at how the change will be viewed by a reasonable employee in the circumstances. For example, if the offer involves a change of location from Toronto to Brampton, the offer may be a reasonable one for an employee who has a car and a driver's license, but may not be reasonable for another employee who is forced to rely on public transportation. The location of the employee's residence should also be considered.
For example, an offer that involves a change from the day shift to the night or "graveyard" shift may not be reasonable. Again, the question to ask is what a reasonable employee in the same circumstances as the employee in question would consider to be reasonable. A single mother, for example, who was on the day shift and is offered alternative employment on the night shift may validly consider such an offer to be unreasonable.
Such items as whether the employee is entitled to an expense account, to travel to business conferences, etc. may be relevant in determining whether an offer was reasonable.
For example, if an employee who has a job with a private office in an office tower is offered a position that comes with a clerical station located on the plant floor, this may be considered an adverse change in the attractiveness of the employee's working environment and militate against a finding that the offer was reasonable.
If the employee was in a managerial position and the employer proposes to place them in a non-managerial position, or if the employee was in a position where they could make significant decisions but is offered a job in which they could not, this will militate against a finding that the offer was reasonable.
If an employee was in a position where there was a good chance of continuing employment for the foreseeable future and is offered a position where continuing employment is unlikely, this will militate against a finding that the offer was reasonable.
If the employee was in a job that was on the "fast track" and is offered one that is "dead end", this will militate against a finding that the offer was reasonable.
The following are some decisions regarding this exemption. While these decisions were issued under the former Employment Standards Act, they continue to be relevant:
Pursuant to s. 2(1) paragraph 6, an employee whose employment is terminated after they refuse alternative employment that is made available through a seniority system is not entitled to notice of termination or pay in lieu.
The effect of the exemption is to relieve the employer from the obligation to give notice of termination or termination pay where the employee refuses alternate work that was made available through a seniority system.
Note that, unlike the exemption in paragraph 5 of s. 2(1), the word "reasonable" does not appear. Therefore, where an employee has refused alternative employment made available through a seniority system, the exemption will apply and the employee will be disentitled to termination notice or pay in lieu regardless of whether or not that alternative employment was reasonable.
The seniority system does not need to be established pursuant to a collective agreement in order for this exemption to apply. However, where the seniority system is not established pursuant to a collective agreement, the employer will have the onus of demonstrating that the seniority system was formalized and was not merely of an ad hoc nature. In this regard, see Re Great Northern Apparel Inc., a decision under the former Employment Standards Act.
In order for there to be a refusal, the employee must be able to perform the work that is made available. There is a distinction between a refusal to do something, on the one hand, and an inability to do something, on the other hand. An employee who is unable to do something (for example, through lack of necessary credentials or disability) cannot be said to have refused to do it. Refusal involves declining to do something that one is able to do. Black's Law Dictionary states: ""Fail" is distinguished from "refuse" in that "refuse" involves an act of the will, while "fail" may be an act of inevitable necessity."
The exemption applies only when the employee's employment is terminated "after" they have refused alternative employment. Accordingly, the refusal must be made before the termination of the employment relationship and the position must be made available prior to the termination. Further, the exemption will apply only if there is a causal connection between the employee's refusal and the subsequent termination of the employee. In other words, if the termination of the employee had nothing to do with the refusal to accept alternative employment, the exemption will not apply, because it is only the employee's refusal to accept the alternative employment that relieves the employer from its obligation to give notice of termination or pay in lieu.
Pursuant to s. 2(1) paragraph 7, an employee who is on a temporary lay-off and does not return to work within a reasonable time after being requested to do so by the employer is not entitled to notice of termination or pay in lieu.
As with other exemptions from minimum standards, the employer has the onus of showing that the exemption applies. In this case, the employer must show that the offer of recall was made to the employee and that the employee clearly understood its terms. From the point of view of proof, the employer will satisfy the onus if it can show that a written notice of recall was received by the employee and that the employee could read and understand it. If the employer alleges that it orally recalled the employee and the employee denies it, it will, of course, be much more difficult for the employer to demonstrate that the employee was recalled. If the employee wilfully structures their affairs so that it is impossible for the employer, using its best efforts, to contact the employee for recall purposes, an employer who uses its best efforts to recall the employee but fails to reach them will be relieved its obligations to provide termination notice or pay in lieu.
The exemption only applies if the employee did not show up for work within a reasonable time after being recalled. This prevents the employer from recalling the employee with extremely short notice and then relying on the exemption when the employee is unable to respond so quickly. What is a reasonable time depends on the circumstances of each case, and will include factors such as where the employee was geographically when they received the recall.
If the employer recalls the employee for a very brief period of time, such as a few hours, it may be that the offer was not bona fide in that the employer made it for the sole purpose of attempting to disentitle the employee to termination notice or pay in lieu. In such a case, the employee who refuses such an offer may not be disentitled to notice or pay. See Highland Cove Marina v Van Velden and Babcock (December 22, 1983), ESC 1531 (Sheppard), a decision under the former Employment Standards Act.
The exemption only applies where the employee is on a temporary layoff. Since, pursuant to ESA Part XV, s. 56, a temporary lay-off does not include a week in which the employee was not able to work or was unavailable for work, the exemption will not apply where the employee is recalled to work during a sick leave or a pregnancy leave, for example.
Pursuant to s. 2(1) paragraph 8, an employee whose employment is terminated during a strike or lockout at the place of employment, or as a result of a strike or lock-out at the place of employment is not entitled to notice of termination or pay in lieu.
With respect to lock-outs, the exemption will apply only if the lock-out is a legal one under the Labour Relations Act, 1995, SO 1995, c 1, Sch A.
The exemption applies only if the strike or lock-out was at the employee's place of employment. The term "the place of employment" is not defined in the ESA 2000, and it is not the same as establishment as defined in ESA Part I, s. 1. When the employer has plants across the province, does a strike at a plant in Thunder Bay, for example, constitute a strike at "the place of employment" of an employee who works at the employer's Mississauga plant? The answer is no. The place of employment means the actual plant or office where the employee works.
The exemption applies when the employee's employment is terminated during a strike or lock-out, or as a result of a strike or lock-out. The meaning of "during" a strike or lock-out is self-evident. An employee terminated during a strike or lock-out, for whatever reason, would not be entitled to notice of termination or pay in lieu. Further, if an employee was given notice of termination prior to a strike or lock-out but was terminated (for example) during a subsequent strike and before the notice period had ended, this exemption would relieve the employer of any obligation with respect to the balance of the notice period or pay in lieu of notice. There is no requirement that the employee be a member of the striking or lock-out bargaining unit.
More difficult is the concept of "as a result of" a strike or lock-out. Can the employer rely on the exemption in a situation where the result of the strike is beneficial to the employer? For example, if the strike enables the employer to find a more efficient and profitable way of doing business without some of the employees, the employer might argue that the employees were terminated as a result of the strike in that their employment would have continued "but for" the strike. However, it is Program policy that in order to take advantage of the exemption, the employer must show that the strike had adverse consequences to its business and therefore necessitated the termination of the employees. In this regard, see Hayes Danc Inc. operating as Spicer Reman Centre v 15 Employees (December 29, 1989), ESC 2609 (Solomatenko), a decision under the former Employment Standards Act.
Furthermore, if the strike was little more than a catalyst, precipitating a closure that would have likely happened anyway, even without the strike, then the terminations will not be "as a result of" the strike within the meaning of the exemption. The strike must be the major cause of the terminations in order for the exemption to apply. If the major cause is instead, for example, lower demand, increased competition, or aging equipment and processes, and the strike is merely "the straw that broke the camel's back", then the exemption will not apply. See Robson Lang Leathers Limited v Legacy et al (January 19, 1979), ESC 574 (Picher), a decision under the former Employment Standards Act.
Pursuant to s. 2(1) paragraph 9, an employee who is a construction employee is not entitled to notice of termination or termination pay in lieu of notice. For purposes of this regulation, of O Reg 288/01, s. 1 provides that construction employee has the same meaning as in O Reg 285/01.
Note, however, there is an exception to this in the case of employees engaged in the maintenance of roads, based on principles of statutory interpretation. O Reg 288/01, s. 9(1) sets out exemptions from the right to severance pay; paragraph 7 of s. 9(1) exempts construction employees, while paragraph 8 exempts employees engaged in the on-site maintenance of, among other things, roads. This clearly indicates an intention on the part of the maker of the regulation that an employee employed in the maintenance of roads would not be considered to be a construction employee for purposes of O Reg 288/01, even though such an employee would be considered to be engaged in road building and thus be a construction employee for purposes of O Reg 285/01. It follows that because O Reg 288/01, s. 2(1), which sets out exemptions from the right to notice of termination or termination pay in lieu, contains no provision corresponding to paragraph 8 of O Reg 288/01, s. 9(1), an employee employed in the maintenance of roads is entitled to notice or termination pay.
See O Reg 288/01, s. 9 for a discussion of the severance pay exemption for road maintenance employees.
On December 12, 2006, O Reg 288/01, s. 2(1) paragraph 11 was amended so that it applies only if the termination does not contravene the Human Rights Code, RSO 1990, c H.19 (as amended by the Ending Mandatory Retirement Statute Law Amendment Act, 2005, SO 2005, c 29). Formerly, the exemption applied where an employee's employment was terminated in accordance with the employer's established practice regarding retirement.
The amendment reflects changes to the Ontario Human Rights Code made under the Ending Mandatory Retirement Statute Law Amendment Act, 2005, SO 2005, c 29 which came into force on December 12, 2006.
On that date, 65 was removed as the cap in the definition of "age" for the purpose of the prohibition against discrimination under the Human Rights Code. As a result, all employees aged 18 or over, including those aged 65 or more, are protected against discrimination on the basis of how old they are, and among other things, generally cannot be forced to retire merely because they are 65 years old or older. Note however that under the Human Rights Code, mandatory retirement polices that can be upheld on bona fide occupational requirement grounds are still lawful.
For example, a fire department's policy that requires firefighter employees to retire at a specific age (e.g., 60 years) would not contravene the Human Rights Code if being younger than that age constituted a bona fide occupational requirement for firefighters. In that case, the notice of termination exemption in O Reg 288/01 would apply to a firefighter whose employment was terminated at age 60 in accordance with that policy.
The rationale for this exemption is that where the employer has an established retirement policy that does not contravene the Human Rights Code, the employee has advance knowledge that their employment will end at a certain time, and there is therefore no need to receive notice of termination or pay in lieu. If the employer has a mandatory retirement policy that contravenes the Human Rights Code, the employer cannot lawfully terminate an employee's employment on the basis of that policy; therefore, the rationale is not applicable in such situations.
On the other hand, if an employer has a voluntary early retirement plan, and the employee chooses to take advantage of it, the employee will not be entitled to notice of termination or pay in lieu. This is not because the exemption applies but because the employee has resigned, rather than having their employment terminated by the employer. In determining whether such an early retirement plan was truly voluntary, one consideration would be what the employee was told would happen if they did not accept early retirement. If the employee was told that they would be fired if the early retirement package were not accepted, then the employee may be considered to have been forced to resign, which is equivalent to a termination and would trigger a right to termination notice or pay in lieu.
Finally, note that even where a termination is effected pursuant to an alleged retirement practice that does not contravene the Human Rights Code, the employer must show that the practice is established for the exemption to apply. The Program's position is that this means it must have been in place for a reasonable period of time and must be known to the employees, especially the employee in question, for a reasonable period of time. If the employer, for example, institutes what is determined to be a bona fide retirement policy at age 60 a few days or weeks prior to the employee turning 60, the policy will not have been in place long enough to be established within the meaning of the exemption. This would be so even if the policy were a bona fide one.
Pursuant to s. 2(1) paragraph 12, an employee who meets the following conditions is exempted from termination pay or notice of termination:
This provision sets out exceptions to the application of the term or task exemption in paragraph 1 of s. 2(1). For a discussion of this provision refer to s. 2(1) para. 1 above.
This provision sets out an exception to the application of the impossibility of performance or frustration of contract exemption in paragraph 4 of s. 2(1) of O Reg 288/01. It provides that the exemption does not apply where the impossibility of performance or frustration of contract is the consequence of an illness or injury suffered by the employee. It was added to O Reg 288/01 by O Reg 549/05, which was filed on October 28, 2005. Refer to s. 2(1) para. 4 above for a discussion of this provision.
This section sets out the amount of notice employees are entitled to when there is a "mass" termination under s. 58(1) of the Employment Standards Act, 2000. These entitlements are the same as they were under the former Employment Standards Act.
In a mass termination, the amount of notice an employee is entitled to receive is determined by the number of employees whose employment is terminated, rather than by the employee’s period of employment. It should be noted that in the Employment Standards Act, 2000, the application of the mass notice provisions depend upon the number of employees actually terminated in a four-week period rather than the number of terminations initiated in a four-week period as was the case under the former Employment Standards Act. See the discussion of mass notice under s. 58(1) at ESA Part XV, s. 58(1).
This section sets out the information that is required to be provided to the Director of Employment Standards and posted in the employer’s establishment under ss. 58(2)(a) and (b) of the Act. Please refer to ESA Part XV, s. 58 for a discussion of the requirements to provide and post this information.
Section 3(3) of O Reg 288/01 sets out the manner in which this information is to be provided to the Director.
This section sets out the manner in which the information referred to in s. 3(2) of O Reg 288/01 is to be provided to the Director of Employment Standards. This section should also be read together with s. 58(4) of the Act, which provides that mass notice is deemed not to have been given until the information referred to in s. 3(2) of O Reg 288/01 has been received by the Director of Employment Standards. See the discussion of s. 58(4) of the Act at ESA Part XV, s. 58.
The prescribed information must be provided to the Director on the form approved by the Director. The form approved for this purpose is entitled "Form 1". The Form 1 may be downloaded from the Ministry of Labour’s website or may obtained from a Service Ontario Information Centre.
The Form 1 is to be delivered during the hours and on the days specified in s. 3(3) to:
Director of Employment Standards
Employment Practices Branch
Ministry of Labour
400 University Avenue, 9th Floor
Toronto, ON M7A 1T7
The Form 1 may be delivered by facsimile transmission to: (416) 326-7061.
This section is similar to the corresponding provision (s. 5(1) of O Reg 327) under the former Employment Standards Act.
This section provides an exception to the application of the mass termination rules. Generally, the mass termination rules apply where the employment of 50 or more employees at an establishment is being terminated in the same four-week period. This section provides that those rules will not apply if the following two criteria are met:
Both criteria must be met in order for this exception to apply. For example, in a situation where the employment of less than 10 per cent of the employees at an establishment is terminated, the mass terminations rules will apply if any of the terminations are caused by a permanent discontinuance of all or part of the business at the establishment.
If the exception in s. 3(4) applies, the individual notice provisions will apply instead of the mass termination rules.
Each criterion is discussed in more detail below.
This is commonly referred to as the "10 per cent rule". This criterion will be met if the number of employees to be terminated represents 10 per cent or less of the number of employees who have been employed for at least three months at the establishment.
To determine whether this criterion applies, the first step is to determine the number of employees who have had their employment terminated (the numerator in the equation). All employees who are terminated, whether they are entitled to notice of termination or not under the Act, are included in counting the number of employees being terminated, including employees with less than three months of employment. A plain reading of the regulation suggests that these employees are excluded only when counting the number of employees employed at the establishment; they are not excluded when counting the number of employees whose employment is terminated.
The second step is to determine how many employees who have been employed for at least three months were employed at the employer’s establishment (the denominator in the equation). The time at which this count is done is the day before the first day of the four-week period in question.
Consider the following example:
Number of employees whose employment is terminated:
Total — 105
Number of employees at establishment:
The calculation to be performed to see if the 10 per cent criterion applies is as follows:
105 divided 950 = 11.05%
Because this calculation results in a number greater than 10 per cent, the exception in s. 3(4) will not apply, and, consequently, the mass termination rules in s. 58 will apply.
This criterion will be met only if none of the terminations are caused by the permanent discontinuance of part or all of the employer’s business at the establishment. If any of the terminations are caused by the permanent discontinuance of the employer’s business at the establishment, the mass termination rules will apply.
Again, both this criterion and the 10 per cent criterion must be met in order for the exception to the application of the mass termination rules in s. 3(4) to apply.
The corresponding provision under the former Employment Standards Act (s. 5(1) of O Reg 327) referred to "all or part" of the employer’s business. Section 3(4) of O Reg 288 has the same meaning even though it refers only to "part" of the employer’s business. This is because, logically, where there is a discontinuance of all of the business there will necessarily be a discontinuance of part of the business.
The phrase "part of the employer’s business" is not defined in the Act, and was the subject of some controversy under the former Employment Standards Act. There is not a body of case law from referees or adjudicators on the meaning of this phrase. However, there have been quite a few decisions from the Ontario Labour Relations Board on the issue of what constitutes "part of a business" within the meaning of the Labour Relations Act, 1995, SO 1995, c 1, Sch 1 ("LRA 1995") successorship provisions. Although these decisions have been decided in a context different from the ESA 2000 provisions, they may be helpful.
Generally, the LRA 1995 cases suggest that what is meant by "part of the business" is a coherent and severable part of the employer’s economic organization, managerial or employee skills, plant, equipment, "know how" or goodwill. Thus, the closing of one of several stores in a chain, or the closing of one of several plants will amount to the discontinuance of part of the employer"s business at an establishment, provided, of course, that the stores or plants in question were all in the same "establishment" as that term is defined in s. 1 of the Act. See the discussion of this term in the mass termination context in ESA Part XV, s. 58. Also, where the employer conducts several types of operations at one location, e.g., it manufactures several types or brands of products at that location, and the employer discontinues one of those operations, there will be a discontinuance of part of the employer’s business. However, where the employer is merely reducing its workforce by downsizing and continues to perform the same operations or functions as before, but on a smaller scale, there will not be a discontinuance of part of the business.
Some of the relevant LRA 1995 cases on what is "part of a business" are as follows:
A discontinuance that is temporary in nature will not be permanent for the purposes of s. 3(4)(b), even if the discontinuance goes beyond 13 weeks. For example, where one of the employer’s witnesses testified that the closure of a mine could last as long as three years, but that it intended to re-activate the mines at some future unknown date, it was held that the discontinuance was not a permanent one - see Re Falconbridge Nickel Mines Ltd. and Simmons et al., 1978 CanLII 1696 (ON SC), a decision under the former Employment Standards Act.
This provision sets out the manner in which notice of termination required by ss. 57 or 58 must be provided. This section is subject to s. 5 of O Reg 288/01, which addresses the issue of providing notice where "bumping rights" apply. See O Reg 288/01, s. 5. It is substantially the same as the corresponding provision (s. 8(1) of O Reg 327) under the former Employment Standards Act.
Notice of termination of employment must be in writing. It is Program policy that the notice must specify when the employment is to be terminated, even if the employee is made aware of the impending termination through other means. See for example Estimations Trimac Appraisals Inc. v Cholette (October 31, 2000), 2806-99-ES (ON LRB), a decision under the former Employment Standards Act in which an employee was aware of and actively involved in the employer’s closure plans, including writing a letter to the landlord indicating the premises would be vacant on a particular date.
Although this provision requires notice in writing, it is Program policy that oral notice may be sufficient if the oral notice is clear and unequivocal and is greater in length than the notice required under ss. 57 or 58 and the minimum requirements concerning continuation of wages and benefits are met. The basis of this policy is that a greater right or benefit under s. 5(2) of the Employment Standards Act, 2000 has been provided. This is supported by Fanaken v Bell, Temple, 1984 CanLII 1856 (ON SC), a court case decided under the former Employment Standards Act.
Where the employer is alleging that it gave oral notice greater in length than the required minimum written notice, the onus is on the employer to show that the employee received and understood the oral notice, and that the notice was specific as to the date of termination.
The notice of termination is to be addressed to the employee whose employment is to be terminated. Obviously, notice cannot be effective if it is not clear whose employment is to be terminated.
This clause was amended by O Reg 397/09 to delete specific references to personal service. The amendment reflects the fact that the expanded methods of service listed in s. 95 (as amended by the Employment Standards Amendment Act (Temporary Help Agencies), 2009, SO 2009, c 9, in force on November 6, 2009) include personal service.
The written notice of termination must be served in accordance with s. 95 of the Act. For a discussion of the methods of service listed in s. 95(1), see ESA Part XXI.
Service of a written notice of termination by a method listed in s. 95(1) is effective in accordance with ss. 95(2), (3) or (4) depending on the method of service used.
This section applies in situations where an employer intends to lay off an employee for a period longer than a temporary lay-off but would be in breach of a collective agreement if it gave notice of termination of employment. (This situation arises, for example, where the collective agreement permits indefinite lay-offs but permits "terminations" only where there is just cause.) In this case only, the employer may give written notice of indefinite lay-off and be deemed to have provided the employee with notice of termination.
Subsection 56(4) of the Act states that an employer who lays an employee off without specifying a recall date shall not be considered to terminate the employment of the employee unless the lay-off is longer than a temporary lay-off — see ESA Part XV, s. 56. Accordingly, while the notice of indefinite lay-off is from the outset deemed to be a notice of termination, there is no termination of employment per se unless the lay-off goes on longer than a temporary lay-off.
If an employer gives working notice of indefinite layoff that is of sufficient length, there would be no termination pay liability in the event that the period of the lay-off ends up exceeding the period of a temporary lay-off, because the employer is deemed under s. 4(2) of O Reg 288/01 to have provided the employee with notice of termination. In such cases, the termination date is deemed under s. 56(5) to have been the first day of the lay-off. Because of s. 56(4) there will be a termination pay entitlement only if the layoff goes on longer than a temporary lay-off and the notice of indefinite layoff given under s. 4(2) was in some way deficient (e.g., notice not in writing, or notice to take effect immediately or prior to the expiry of the notice period that would otherwise have been applicable under s. 57).
Conversely, where notice of indefinite lay-off is given but the lay-off turns out not to exceed the period of a temporary lay-off, there would be no termination of employment and therefore no termination pay entitlement.
It should be noted, however, that an employer may run the risk that some employees may resign during the notice of indefinite layoff period in accordance with the condition described in s. 63(1)(e) of the Act and become entitled to severance pay. Clause 63(1)(e) of the Act provides that where an employee is given a notice of termination by the employer and resigns with at least two weeks' notice to take effect during the statutory notice period, his or her employment is severed. Since a notice of indefinite lay-off is deemed to be a notice of termination under s. 4(2), this means that the employee who receives a notice of indefinite lay-off and who responds with a notice of resignation meets all the specified conditions in order to be entitled to severance. The employment is deemed to have been severed on the termination date specified in the employer’s notice, and the employer would have to pay the severance pay on the later of seven days after that date and the date that would have been the next pay for the employee. See ESA Part XV, s. 63.
These provisions are substantially the same as the corresponding provision (s. 7 of Reg 327) under the former Employment Standards Act.
This section applies where employees who are to be terminated have the right to "bump" another employee with less seniority out of their job and take that job.
Where an employee has the right to "bump" a more junior employee, the employer is deemed to have provided written notice of termination to the more junior employee who is ultimately terminated by posting a notice in a conspicuous part of the workplace indicating the seniority, job classification and proposed lay-off or termination date of the employee named in the notice (the "bumper"). The principle is that the employee who will be bumped out can determine his or her fate from the posted notice and the seniority list. Note, however, that if the employee originally identified in the posted notice does not "bump" a more junior employee, the employer will be required to comply with the notice requirements in s. 4(1) of O Reg 288/01 with respect to the employee named in the posted notice.
Finally, it should be noted that if read literally, this provision would appear to limit the application of s. 5 such that it would provide effective notice only to the first employee bumped by the employee named in the posted notice. If that were the case, the employer would have to comply with s. 4(1) with respect to the employee ultimately bumped (e.g., a second or third, etc. "bumpee"). However, it is the Program’s policy (based on the principle of statutory interpretation that a literal interpretation should not be taken where the result would lead to an absurdity) that the section must be read broadly as if it were of the same purport as the corresponding provision (s. 7) in O Reg 327 under the former Employment Standards Act. As a result, it is the Program’s policy that s. 5 will apply to provide effective notice to the employee ultimately displaced through the "bumping" process, even though he or she is not in fact displaced by the person named in the notice.
This section provides that s. 60(1)(a) of the Employment Standards Act does not apply to an employee who bumps another employee as described in ss. 5(1) and (2). Section 60(1)(a) provides that an employer shall not reduce the employee’s wage rate or change a term or condition of employment during the statutory notice period. See ESA Part XV, s. 60.
Under this provision, an employee whose position is being terminated and who exercises his or her seniority rights to "bump" into a position of a more junior employee, may be paid the wage rate and be subject to the terms and conditions of employment of that new position during the statutory notice period.
This section provides that an employer who has given an employee notice of termination in accordance with the Employment Standards Act, 2000 may provide the employee with temporary work during the 13-week period following the date the employee’s employment was to end without affecting the employee’s termination date or period of employment and without being required to provide any further notice when the employee’s employment finally does end. In that regard, see Di Tomaso v Crown Metal Packaging Canada LP, 2011 ONCA 469 (CanLII), where the Court of Appeal held that s. 6 of O Reg 288/01 contemplates temporary work not exceeding 13 weeks in duration from the originally-specified termination date and that if the temporary work exceeds that duration, new notice is required. The employer was unsuccessful in arguing that s. 6 allowed successive periods of temporary work of 13 weeks or less without imposing an obligation on the employer to give new notice in respect of the date on which employment is finally ended. The court held that to interpret the section in that way would be inconsistent with the status of employment standards legislation as remedial, benefit-conferring legislation as characterized by the Supreme Court of Canada in Rizzo & Rizzo Shoes Limited (Re), [1998] 1 SCR 27.
This section is substantially the same as the corresponding provision (s. 10 of O Reg 327) under the former Employment Standards Act.
This section states that the period of notice of termination given to an employee shall not include any vacation time unless the employee agrees to include the vacation time in the notice period. Under s. 1(3) of the Employment Standards Act, 2000, any such agreement must be in writing.
Note that if an employee had been scheduled to take a vacation before he or she was given notice of termination, and that vacation would now fall within the statutory notice period, this provision would require the employer to obtain the employee’s agreement to take that previously scheduled vacation during the notice period.
This section is substantially the same as the corresponding provision (s. 14(1) of O Reg 327) of the former Employment Standards Act.
This section establishes the length of an employee’s period of employment for the purpose of calculating the amount of notice of termination or termination pay owing to that employee. The period of employment is the period beginning on the date the employee most recently commenced employment with the employer, and ending:
This section must be read in conjunction with s. 8(2) of O Reg 288/01, which sets out circumstances in which two periods of employment are to be considered as one period of employment (see the discussion of subsection (2) below).
The period of employment will only include employment in Ontario or work that is a continuation of work in Ontario. For example, if an employee worked for ABC Inc. for five years in England, then was transferred to Ontario and worked in Ontario for two years before being terminated, his or her period of employment for the purposes of s. 54 to s. 62 of the Act and O Reg 288/01 would be two years.
This section should also be read in conjunction with s. 59 of the Act, which sets out time that is to be included and excluded from an employee’s period of employment - see ESA Part XV, s. 59.
Note that this provision applies only for the purposes of ss. 54 to 62 of the Act (Termination of Employment). That is, it applies only for the purpose of calculating the amount of notice of termination or termination pay owing. It does not apply for the purpose of determining eligibility for notice of termination or for determining severance pay entitlements.
Eligibility for notice of termination is triggered by three months of continuous employment rather than the employee’s "period of employment".
As a result, time on lay-off after the deemed termination date will be excluded in determining the "period of employment" under s. 59 of the Act but will be included when determining whether the employee had three months of continuous employment and was or was not eligible for notice of termination. See the discussion of eligibility for notice under s. 54 of the Act at ESA Part XV, s. 54.
Section 8(2) of O Reg 288/01 requires that successive periods of employment that are separated by 13 weeks or less be added together for the purpose of determining the period of employment under s. 8(1), which is used for calculating the amount of notice of termination or termination pay to which an employee is entitled. Bear in mind, however, s. 59 of the Act, under which inactive employment counts in determining an employee’s period of employment, except for any part of a lay-off that falls after the deemed termination date. Where the periods of employment are more than 13 weeks apart, only the last period of employment will be counted for these purposes.
The application of s. 8(2) can be illustrated with the following example: an employee was employed by Company A from January 1, 2008, until December 31, 2013 (5 years), and from February 1, 2014, to April 30, 2015 (1.25 years). This employee will have a period of employment of 6.25 years for notice of termination and termination pay purposes. The first 5-year period of employment is added to the second 1.25 year period of employment since the two periods are not separated by more than 13 weeks.
Note that s. 8(2) will apply to add more than two periods of employment together if the periods are not separated by more than 13 weeks. For example, if an employee was employed by Company B from January 1, 2010 to December 31, 2010 (one year), then again from February 1, 2010 to October 1, 2011 (0.75 of a year) and then yet again from December 1, 2011 until October 1, 2011 (2.25 years), all the periods of employment will be added together since the intervals between the first and second periods and between the second and third periods do not exceed 13 weeks. Thus, the employee’s period of employment will be four years.
This provision will apply to tie together successive periods of employment that are separated by no more than 13 weeks regardless of the reason for the earlier period coming to an end, i.e., it is irrelevant that the earlier period ended because the employee quit or was fired (regardless of the reason for the firing). See for example Filter Dynamics v Couling (September 9, 1981), ESC 1061 (Davis).
Note that eligibility for notice of termination is triggered by three months of continuous employment (and not a period of employment of three months). See the discussion of eligibility for notice under s. 54 of the Act at ESA Part XV, s. 54.
Note also that this provision applies only for the purposes of calculating the notice of termination or termination pay entitlement. It does not apply for the purpose of determining severance pay entitlements.
This section sets out the exemptions from the severance provisions of the Employment Standards Act, 2000. The employees listed in this section are not entitled to severance pay. A discussion of each exemption appears below.
This provision has substantially the same effect as s. 58(5)(b) of the former Employment Standards Act
The effect of this exemption is to relieve an employer of its obligation to provide severance pay under s. 64 if an employee’s employment is severed as a result of a permanent discontinuance of all or part of the employer’s business that the employer establishes was caused by the economic consequences of a strike. Note that the exemption can apply only in the context of a strike, not a lock-out.
With respect to the phrase "permanent discontinuance of all or part of the employer’s business", see the discussion of s. 3(4)(b) of O Reg 288/01. Although s. 3(4)(b) refers to a permanent discontinuance of only part of the employer’s business rather than all or part, it is the Program’s view that the two phrases have the same meaning. This is because, logically, where there is a discontinuance of all of the business, there will necessarily be a discontinuance of part of the business.
The test to be applied in determining whether the permanent discontinuance was caused by the economic consequences of the strike is whether or not the closure would have happened even if the strike had not occurred. If the answer is yes, then this exemption will not apply.
In determining whether the closure would have happened even in the absence of the strike, an employment standards officer considers whether the business would have continued to operate for a significant period of time beyond the closure if it were not for the strike. If, without the strike, the business would have closed soon after it actually did, then the employer cannot escape severance pay liability by showing that the strike simply hastened a closure that would have happened in any event. If the seeds of a business demise are "planted and take root" before a strike, it cannot be said that the strike caused the closure within the meaning of the exemption. See Courtaulds Films Canada, division of International Paints (Canada) Limited v Amalgamated Clothing and Textile Workers' Union, Locals 1332 and 1675 (December 10, 1991), ESC 2949 (Bendel), a decision under the former Employment Standards Act. In applying the test noted above, consideration should also be given to whether the employer actually took into account the economic consequences of the strike in deciding to close its business. If the employer did not take those consequences into account, then it cannot later on, after the closure, look back in retrospect and say that the closure was actually caused by the strike for purposes of the exemption.
Other cases that dealt with s. 58(5)(b) of the former Employment Standards Act include:
The effect of this exemption is to relieve an employer of its obligation to provide severance pay under s. 64 in some situations where an employee’s contract of employment has become impossible to perform or has been frustrated (see O Reg 288/01, s. 2(1) para. 4 for a discussion of the meaning of these terms). However, there are exceptions to the application of this exemption set out in s. 9(2) of O Reg 288/01, discussed below.
The effect of this exemption is to relieve an employer of its obligation to provide severance pay under s. 64 in some situations where an employee retires upon having his or her employment severed. The exemption will apply only if the employee receives an actuarially unreduced pension benefit that reflects any service credits the employee would have earned for the purposes of the pension plan had the employment not been severed. This exemption is substantially similar to the corresponding provisions (ss. 58(5)(g) and 58(6)(d)) under the former Employment Standards Act, as those provisions were interpreted in the case law.
In order for this pension exemption to apply, the pension must be provided by the employer that is severing the employee. Pensions from the Canada Pension Plan or from prior employers are not to be taken into consideration.
This exemption will not apply if the pension benefit is reduced (whether actuarially or otherwise) to an amount less than what the employee would have received had the employee been given the opportunity to stay until the normal retirement date.
It should be noted that although the term pension plan is defined very broadly in O Reg 286/01 (and encompasses such plans as deferred profit sharing plans, group RRSPs or retiring allowances) for the purposes of prohibiting differentiation in the provision of such plans (s. 44 of the Act and O Reg 286/01), they are not in fact true pension plans.
The Program’s position is that it is appropriate in the context of prohibiting differentiation in the provision of benefits to construe the term "pension plan" broadly, but in the context of creating an exemption from an entitlement to severance under the Act that the term should be construed narrowly to include only plans that are registered under the Pension Benefits Act, RSO 1990, c P.8 and the federal Income Tax Act, RSC 1985, c 1 (5th Supp) as pension plans. The two main types of registered plans are defined benefit pension plans and defined contribution pension plans.
Further, of these two types of plans, the exemption in s. 9(1) paragraph 3 will apply only where the employee has a defined benefit pension plan. A defined benefit plan is one where the benefit is predetermined and the payout is dependent upon the accrual of service credits. It is the Program’s view that the exemption can have no application where the employee has a defined contribution plan because such plans have a payout that is not dependent on years of service (i.e., the payouts are dependent on the total amount of contributions and investment income that has been earned).
The following are examples of a defined benefit pension plan:
The monthly pension amount is calculated as $100 multiplied by the number of years of service; it also provides for a reduction in that amount of 5 per cent for each year between the actual retirement date and the normal retirement date. The employee was forced to retire at age 62 after fifteen years of employment.
Here the exemption cannot apply for two reasons. First, the penalty, typically imposed to reflect the fact that employees who retire before normal retirement age will collect their pensions for a longer time than those who do not retire until normal retirement age, means that the pension is not "actuarially unreduced". Second, because in the normal course of events the employee would not have retired until age 65, by which time he would have had eighteen years of employment, the pension does not reflect all the service credits that the employee, had his employment not been severed, would have been expected to have earned in the normal course of events.
The monthly pension is calculated as one-twelfth of the product of an employee’s years of service multiplied by 2 per cent multiplied by the average of the employee’s five highest years of salary. The employee was forced to retire at age 61 after 22 years of service. However, her pension was not subject to any penalty for early retirement because the plan provides that there will be no such penalty if the employee is at least 60 years of age and has at least 20 years of service credits.
Here, although the pension is actuarially unreduced, the exemption still cannot apply. This is because in the normal course of events she would not have retired until age 65 and would have been expected to have had 26 years of service credits rather than 22.
It is important to remember that there must be a severance of the employee’s employment in order for the severance pay provisions to apply at all. An employee who voluntarily takes early retirement and receives a reduced pension has resigned and will not be entitled to severance pay. In determining whether or not the employee’s decision to take early retirement was truly voluntary, the circumstances behind the decision must be considered. If the employer informed the employee that the only alternative to accepting the early retirement package would be dismissal or a change in the job that would amount to a constructive dismissal, then the employee’s resulting acceptance of the early retirement package would not be considered to be truly voluntary. Where the employee retires at normal retirement age pursuant to a mandatory retirement provision in the contract of employment, the employment will be considered to have been severed, even if the employee does not expressly ask to be allowed to stay on past that age. Where, however, the employee is asked to stay on past the normal retirement age and refuses, the employee will either be considered to have resigned or to have refused reasonable alternative work and will therefore be disentitled to severance pay.
It should be noted that this exemption has no application where an employee whose employment is severed, retires with no pension provided by the employer. In such cases, the employee will be entitled to severance pay unless he or she is otherwise exempted. In this regard, see the following cases which were decided under the former Employment Standards Act: Re Alexanian & Sons Ltd.; Ascona Spinning Ltd. v Avery (March 21, 1990), ESC 2659 (Bendel); and D.H. Howden, Division of Sodisco-Howden Buying Group Inc. v Lines, 2000 CanLII 13255 (ON LRB).
The effect of this exemption is to relieve an employer of its obligation to provide severance pay under s. 64 where it severs the employment of an employee who has refused an offer of reasonable alternative employment with the employer. This exemption is substantially similar to the corresponding provision (s. 58(6)(a)) of the former Employment Standards Act.
This exemption is identical in wording and meaning to the corresponding termination notice/pay exemption in paragraph 5 of s. 2(1) of O Reg 288/01 — see the discussion in O Reg 288/01, s. 2(1), para. 5.
The effect of this exemption is to relieve an employer of its obligation to provide severance pay under s. 64 where it severs the employment of an employee who has refused reasonable alternative employment that is made available through a seniority system. This exemption is substantially similar to the corresponding provision (s. 58(6)(b)) of the former Employment Standards Act.
With one important difference, this exemption is the same as the corresponding termination notice/pay exemption (paragraph 6 of s. 2(1) of O Reg 288/01). The only difference is that this exemption only applies if the alternative work offered is reasonable. With respect to the issue of whether an employee has refused alternative work made available through a seniority system, please refer to section O Reg 288/01, s. 2(1) para. 6. With respect to the issue of whether the alternative work was reasonable, please refer to O Reg 288/01, s. 2(1) para. 5.
An employee who has been guilty of wilful misconduct, disobedience or wilful neglect of duty that is not trivial and that has not been condoned by the employer is not entitled to severance pay. This exemption is substantially the same as the corresponding provision (s. 58(6)(c)) of the former Employment Standards Act and the Program policy under that provision. The only difference between the wording of this exemption and its predecessor is the addition of the words "that is not trivial". This change codifies Program policy that applied under the former Act.
This exemption is identical in wording and meaning to the corresponding exemption for termination notice/pay in paragraph 3 of s. 2(1) of O Reg 288/01. Please refer to the discussion of that provision in O Reg 288/01, s. 2(1) para. 3.
For information on the application of the wilful disobedience exemption where an employee is not vaccinated against, or tested for, COVID-19 in accordance with the employer’s policy, see “ESA Termination and Severance Liabilities Where an Employee is Not Vaccinated Against or Tested For COVID-19”.
An employee who is a “Construction employee” is not entitled to severance pay. For purposes of O Reg 288/01, section 1 of the regulation provides that the term “construction employee” has the same meaning as in O Reg 285/01.
Note, however, there is an exception to this in the case of employees engaged in the maintenance of roads, based on principles of statutory interpretation. Employees who are engaged in road maintenance, although considered “construction employees” for the purposes of O Reg 285/01, are not treated as construction employees for the purposes of O Reg 288/01. See O Reg 288/01, s. 1 for a detailed explanation. Accordingly, employees who are engaged in road maintenance are not covered by the “construction employee” exemption from severance pay in paragraph 7 of s. 9(1). Nonetheless, they are not entitled to severance pay; this is because of paragraph 8 of s. 9(1), which exempts employees engaged in the on-site maintenance of, among other things, roads. See paragraph 9 below for detailed discussion of paragraph 9 of s. 9(1).
Employees who are engaged in the on-site maintenance of buildings, structures, roads, sewers, pipelines, mains, tunnels or other works are not entitled to receive severance pay.
Although employees who are engaged in the maintenance of roads are exempt from severance pay entitlements by virtue of this paragraph, they are entitled to the termination pay/notice provisions. See O Reg 288/01, s. 2(1), para. 9. Note that a decision under the former Employment Standards Act rejected the argument that office cleaners should be regarded as being engaged in on-site maintenance of buildings. The referee in Federated Building Maintenance Co. Ltd. v 195 Employees (September 23, 1988), ESC 2377 (Franks) held that cleaning was of a cosmetic and hygienic nature, whereas maintenance was an activity primarily aimed at preventing systems from falling into disrepair.
Section 9(1) para. 2 relieves an employer of its obligation to provide severance pay under s. 64 in some situations where an employee’s contract of employment has become impossible to perform or has been frustrated. Section 9(2) sets out the exceptions to s. 9(1) para. 2. These two provisions mean that an employee whose employment has been severed (and who meets all the qualifying criteria for severance pay) will be entitled to severance pay even if the contract has become impossible to perform or frustrated, if the reason for the frustration or impossibility was because of:
Each of these situations is described in more detail below.
An employee whose employment contract has become impossible to perform or frustrated because of a permanent discontinuance of all or part of the employer’s business because of a fortuitous or unforeseen event will be entitled to severance pay (assuming the qualifying criteria for severance pay are met).
With respect to the phrase "permanent discontinuance of all or part of the employer’s business", see the discussion of s. 3(4)(b) of O Reg 288/01.
The phrase "because of a fortuitous or unforeseen event" could include events such as the destruction of the employer’s business (for example, by fire, tornado or flood), a supervening change in the law (for example, where a company manufactures cigarettes and it becomes illegal to manufacture tobacco products in Canada), or the loss by the employer of a licence that it must have in order to operate.
It should be noted that where a contract is frustrated or has become impossible of performance as a result of a permanent discontinuance of all or part of the business because of a fortuitous or unforeseen event, the employee is entitled to severance pay because of the application of s. 9(2)(a)(i), but he or she would not be entitled to notice of termination/termination pay under the Act (paragraph 4 of s. 2(1) of O Reg 288/01) because there is no corresponding exception to the "impossibility of performance/frustration of contract" exemption from notice of termination/termination pay.
An employee whose employment contract has become impossible to perform or frustrated because of the death of the employer will be entitled to severance pay (assuming the qualifying criteria for severance pay are met). Thus, where a business that had been carried on by a sole proprietor ceases to operate because of the employer’s death and the employee’s employment is severed as a result, the employee will (assuming that he or she otherwise qualifies) be entitled to severance pay, notwithstanding that the employer’s death would have frustrated the employment contract as a matter of law.
Note the different results with respect to an employee’s entitlement to termination pay/notice and their entitlement to severance pay where the contract has become impossible to perform or frustrated because of the employer’s death. Whereas the death of the employer may, in some situations, disentitle an employee from notice of termination/termination pay as a fortuitous or unforeseeable event that frustrates the contract of employment or makes it impossible to perform — see the discussion of paragraph 4 of s. 2(1) of O Reg 288/01 — it will not disentitle an employee from severance pay.
An employee whose employment contract has become impossible to perform or frustrated because of the employee’s death will be entitled to severance pay (assuming the qualifying criteria for severance pay are met), so long as the employee received notice of the termination of his or her employment before his or her death.
For example, if an employee is given eight weeks' notice of termination and dies after six weeks of that notice have elapsed, the employee will be entitled to severance pay even though the employee’s employment was not actually severed by the employer, in that the employee’s death, having occurred during the notice period and before the notice took effect, ended the employment contract before severance by the employer could take place.
The frustration exemption does not apply where the frustration of the employment contract is a result of employee injury or illness. An employee whose employment has been severed and whose employment contract has become impossible to perform or frustrated because of the employee’s illness or injury will be entitled to severance pay (assuming the qualifying criteria for severance pay are met).
This exception to the exemption from severance entitlements was amended by O Reg 549/05. Prior to the amendment, the exception applied only if the employer was also prohibited from severing the employee’s employment under the Human Rights Code, RSO 1990, c H.19. See the discussion of frustration and impossibility in disability situations in O Reg 288/01, s. 2(1) para. 4.
This regulation sets out which penalties are prescribed for notices of contravention as per ESA Part XXII, s. 113. It also sets out which provinces are reciprocating states for reciprocal enforcement of orders as per ESA Part XXIV, s. 130.
ESA Part XXII, s. 113 permits an employment standards officer to issue a notice requiring payment of a prescribed penalty as set out in O Reg 289/01 to a person that the officer believes has contravened the ESA 2000. The officer’s power to issue a notice of contravention is discretionary, like the ability to issue other orders. However, if a notice of contravention is issued, the penalty amounts must be applied as set out within O Reg 289/01.
Note the penalties set out in O Reg 289/01 were higher from January 1, 2018 to December 31, 2018. During that period of time, the penalty amounts were $350/$700/$1500 instead of $250/$500/$750. Pursuant to subsection 52(5) of the Legislation Act,footnote 11 the higher amounts apply only if the contravention relating to the Notice of Contravention occurred during the 2018 calendar year and the Notice of Contravention was issued during the 2018 calendar year. Otherwise, the lower amounts set out in the current O. Reg. 289/01 apply.
Penalties for a contravention of ESA 2000 section 2, 15, 15.1 or 16:
Per items 1 to 3 in the chart above, the penalties for a contravention of one of these sections are as follows:
Note that when determining the penalty for a contravention of section 2, 15, 15.1 or 16, the number of employees affected by the contravention is not relevant; the officer does not multiply the penalty by the number of employees affected.
Penalties for a contravention of any provision other than section 2, 15, 15.1 or 16 affecting only one employee:
Per items 4 to 6 of the chart above, the penalties in this context are as follows:
Penalties for a contravention of any provision other than section 2, 15, 15.1 or 16 affecting more than one employee:
Per items 7 to 9 in the chart above, the penalties in this context are as follows:
Note that in order for the penalty amount to escalate (i.e. from $250 to $500, or from $500 to $1000), the same provision of the ESA 2000 must have been contravened for a second or third time within a three-year period. This means that one or more NOCs must have previously been issued and have resulted in a deemed contravention under subsection 113(5) of the ESA 2000 in the previous three-year period.
Per ss. 113(5), a notice of contravention is deemed to have been contravened where the person against whom it was issued fails to make an application for a review of the notice within 30 days of the date of service, or, where a review was sought, the Ontario Labour Relations Board finds that the person contravened the provision set out in the notice.
When determining whether there is a prior deemed contravention that will cause the penalty amount to escalate, it is the three year period prior to the date of the current contravention for which an NOC is being issued that is reviewed, rather than the three year period prior to the date the current NOC is being issued.
An officer may issue a notice of contravention to any person the officer believes has contravened the ESA 2000. “Person” is defined in ESA Part I, s. 1 to include a trade union. The word “person” indicates that the notice may be issued against persons other than an employer. For example, a notice of contravention could be issued against someone who is not the employer but who has custody of records or documents relevant to an investigation and who refuses to make them available for inspection contrary to ESA Part XXI, s. 91(8).
Effective, October 30, 2019, O. Reg. 291/01 – Terms and Conditions of Employment in Defined Industries Women's Coat and Suit Industry and Women's Dress and Sportswear Industry is revoked. The special rules and terms and conditions for employees working in the women's coat and suit industry and the women's dress and sportswear industry no longer apply. Those employees previously captured by the Regulation will now be subject to the regular provisions of the Employment Standards Act.
This regulation sets out special rules and terms and conditions for employees working in the women’s coat and suit industry and the women’s dress and sportswear industry. In particular, the regulation addresses issues related to hours of work, including minimum pay for short periods of work, normal work day, normal work week, work schedule requirements, breaks relating to special rate work and vacation, etc.
Section 2 states that O Reg 291/01 provides for terms and conditions of employment that apply to employers and employees in the defined industries; however, it also states that except as is otherwise indicated by the regulation, the Employment Standards Act, 2000 applies to them.
This provision was amended effective January 1, 2019 to reflect a change made to the “general” three hour rule; the three hour rule was previously found in section 5 of O. Reg. 285/01; however, effective January 1, 2019, the three hour rule was revoked from s. 5 of O. Reg. 285/01 and a modified three hour rule was introduced to section 21.2 of the Employment Standards Act, 2000.
Section 3(1) of O Reg 291/01 states that despite the three-hour rule as set out in section 21.2 of the Act, an employee in one of the defined industries who is required to work for a period of less than four hours or is required to report for work but does not work any hours, is deemed to have worked four hours, and is to be paid accordingly.
For a discussion on the three hour rule, see ESA Part VII.1, section 21.2.
Subsection 3(2) states that the four-hour rule in O Reg 291/01, s. 3(1) does not apply to homeworkers.
Section 4 of O Reg 291/01 states that ss. 18 to 21 of the Employment Standards Act, 2000 do not apply to employees in the defined industries. Those sections deals with time free from work, exceptional circumstances in which the limits on hours of work and the free time provisions do not apply and the rules concerning eating periods.
Section 5(1) of O Reg 291/01 sets out times when an employer cannot require an employee to perform work:
Section 5(2) states that s. 5(1) applies despite any agreements made under s. 17(2) of the Employment Standards Act, 2000 to exceed the daily limit of eight hours in a day, or a regular work day of more than eight hours, as established by the employer. When O Reg 291/01 was made, s. 17(2) referred to both agreements to work in excess of the daily limit and agreements to work in excess of the weekly limit. Agreements to work in excess of the weekly limit are now dealt with in subsection 17(3) of the Act; however, by virtue of s. 59 of Part VI of the Legislation Act, 2006, SO 2006, c 21, Sch F, the reference in s. 5(2) of the regulation should be read as if it referred to both ss. 17(2) and 17(3) of the Act.
Under s. 1 of the regulation, an “industry holiday” is defined as meaning:
Section 6 of O Reg 291/01 establishes the normal work day and work week for employees in the defined industries. A normal work day is a day between Monday and Friday that does not exceed eight hours, including paid breaks but not including eating periods.
An employee’s normal work week cannot be more than 40 hours, including paid breaks but not including eating periods, from a work week based on the period from midnight on Saturday to midnight on the following Saturday.
9 The employer’s work schedule may provide for two shifts subject to the following:
Section 10(1) of O Reg 291/01 provides that where the employer has not established a work schedule in accordance with ss. 8 and 9, s. 10 applies to establish a "normal work day" for employees in the defined industries.
In that case, the normal work day commences at 8:00 a.m. Monday through Friday with one unpaid half-hour eating period midway through the work day and a paid 10-minute break both before and after the eating period (that is, one before and one after the eating period).
Section 10(2) states that s. 10(1) does not apply with respect to employees who are homeworkers.
Section 13 of O Reg 291/01 states that despite Part VIII of the Employment Standards Act, 2000 dealing with overtime, the employer shall pay an employee the special rate determined under s. 14 for all special rate work.
This regulation sets out special rules regarding the terms and conditions of employment for employees employed in public transit services. Currently, the regulation’s scope is limited to hours free from work and eating periods.
O Reg 390/05 came into effect on June 24, 2005.
Section 1(1) defines the industry to which O Reg 390/05 applies to mean the industry of providing public transit services.
"Public transit services" is defined to mean any fare-charging service for transporting the public by vehicles that are operated by or on behalf of a municipality or a local board, or under an agreement with a municipality or a local board.
The term "vehicle", which might be operated by the public transit service, is defined to include transportation facilities for the physically disabled, but not to include: vehicles and marine vessels for sightseeing tours, school buses, buses owned and operated by a corporation or organization solely for its own purposes without compensation for transportation, taxicabs, railway systems (whether incorporated under federal or provincial statutes), ferries, aviation systems or ambulances.
It should be noted that, in addition to listing these exceptions, the definition of "vehicle" is inclusive rather than exhaustive. Other kinds of vehicles (e.g., subway trains and street cars) might qualify as a vehicle operated by a public transit service even though they are not listed in this s. 1 definition, if they are not specifically excluded.
Section 2 narrows the scope of O Reg 390/05, by restricting it in its application to employees in the defined industry who operate public transit vehicles or who work as collectors and to their employers.
The terms “defined industry” and “vehicle” are both defined in s. 1 of O Reg 390/05.
Section 3 simply states that O Reg 390/05 sets out terms and conditions of employment that apply to employers and employees in the defined industry of providing public transit services.
Section 4(1) of O Reg 390/05 provides that, where the employer and employee in the defined industry agree, s. 4(2) applies instead of s. 18(1) of the Employment Standards Act, 2000. Section 18(1) reads as follows:
Under s. 4(2) of O Reg 390/05, the period of at least 11 consecutive hours free from performing work in each day (in s. 18(1) of the Act) is replaced by a period of at least eight consecutive hours free from performing work in each day. See ESA Part VII, s. 18(1) for a discussion of the meaning of "day".
There can be no substitution of s. 4(2) for s. 18(1) of the Act unless the employer and employee (or union) agree. Agreements to substitute s. 4(2) for s. 18(1) of the Act must be in writing in order to be valid. See ESA Part I, s. 1(3) and s. 1(3.1) for a full discussion of the requirements regarding written agreements.
Like s. 18(1) of the Act which it replaces, the provision for daily rest in s. 4(2) of O Reg 390/05 is an employment standard as defined in s. 1(1) of the Act and cannot be contracted out of or waived (s. 5(1)). The employer and employee could not, for example, agree to a daily rest period of six hours.
For a discussion of how the 11-hour daily rest operates, see ESA Part VII, s. 18(1). Substitute "8 hours" for "11 hours" each time it appears in order to understand the operation of the eight-hour daily rest period under s. 4(2) of O Reg 390/05.
The requirement in s. 4(2) for at least eight consecutive hours off work in each day operates together with the hours of work provisions in Part VII of the Act and s. 5 of O Reg 390/05, as follows:
Section 18(2) of the ESA 2000 sets out an "on-call exception" to s. 18(1) of the Act. This exception also applies if the daily rest period is eight consecutive hours as per s. 4(2) of O Reg 390/05, when it replaces the 11-hour daily rest requirement in s. 18(1) in the defined industry.
Under s. 18(2), the requirement that an employee have at least 11 hours free from performing work in each day (in accordance with s. 18(1) of the Act) or at least eight hours free from performing work in each day (in accordance with s. 4(2) of O Reg 390/05) does not apply to an employee who is on call and is called in during a period he or she would not otherwise have been expected to work. The on-call exception is an exception only to the requirement to provide 11 or eight consecutive hours free from work each day as per s. 18(1) of the Act or s. 4(2) of O Reg 390/05. It does not operate as an exception to any other hours of work provisions.
For a discussion of the on-call exception, see ESA Part VII, s. 18(2). Substitute s. 4(2) of O Reg 390/05 for s. 18(1) of the Act, and substitute eight hours for 11 hours, wherever the references appear.
Section 17(1) of the ESA 2000 provides for maximum daily hours of work of eight hours per day or, if there is an established workday that is longer than eight hours, the number of hours in that work day. However, under s. 17(2) of the Act, employers and employees can agree, in writing, that the employee will work up to a specified number of hours in excess of the daily limit. For such an agreement to be valid, s. 17(5) requires that non-unionized employees first be provided with a copy of the Ministry of Labour’s information sheet on hours of work and overtime and that the agreement contains a statement by the employee acknowledging such receipt.
For further details about the maximum daily hours of work, agreements to vary from the maximum daily hours and the requirement to provide the Ministry’s information sheet, see ESA Part VII, s. 17.
Section 17(1) of the ESA 2000 provides for maximum weekly hours of work of 48 hours. However, under s. 17(3) of the ESA 2000, employers and employees can agree, in writing, that the employee will work up to a specified number of hours in excess of the weekly limit. For such an agreement to be valid, s. 17(5) requires that non-unionized employees first be provided with a copy of the Ministry of Labour's information sheet on hours of work and overtime and that the agreement contains a statement by the employee acknowledging such receipt.
For further details about the maximum weekly hours, agreements to vary from the maximum weekly hours and the requirement to provide the Ministry's information sheet, see ESA Part VII, s. 17.
Section 18(3) of the Act requires employers to provide employees with a minimum period free from work of eight hours between successive shifts, with two exceptions. First, an employee may work successive shifts without the eight-hour free period if the total number of hours worked on the successive shifts is 13 or less. Second, the employer and employee can agree, in writing, to forego the eight-hour period entirely or to reduce its length. For a discussion of the interaction of s. 18(3) with the required daily rest in s. 18(1) of the Act, see ESA Part VII, s. 18(3).
Per s. 4 of O Reg 390/05, an employee and employer in the defined industry could agree in writing to a minimum daily rest of eight hours (instead of the 11 hours in s. 18(1) of the Act). That employee could then agree in writing to work an eight and a 10-hour shift back to back, without any break between them. The agreement in writing would comply with s. 18(3) of the Act, but if it resulted in the employee receiving a daily rest of less than eight consecutive hours (per the agreement under s. 4 of the Regulation), the schedule would be in violation of the Regulation and, therefore, would not be permitted. In other words, an employee in the defined industry cannot agree to work hours under s. 18(3) of the Act that would result in the employee getting less than the eight consecutive hours free from work each day stipulated in s. 4(2) of O Reg 390/05.
Section 18(4) of the ESA 2000 establishes weekly or bi-weekly free time requirements for employees. The free time periods must be at least either 24 consecutive hours in every "work week" or 48 consecutive hours in every two consecutive "work weeks".
See ESA Part VII, s. 18(4) for a discussion of the weekly/bi-weekly rest period provisions.
Section 19 of the ESA 2000 allows employers to require employees to work more daily or weekly hours than are permitted under s. 17 of the Act, or to work during a free period (daily, in between shifts and weekly or biweekly) as required by s. 18 of the Act (and s. 4(2) of O Reg 390/05) in any of the specified circumstances, but only so far as is necessary to avoid serious interference with the ordinary working of the employer’s establishment or operations.
For a discussion of the exceptional circumstances, see ESA Part VII, s. 19.
Under s. 20 of the ESA 2000, an employer is required to provide an eating period of at least 30 minutes, timed so that no employee works longer than five consecutive hours without receiving an eating period, or, if the employer and employee agree (not necessarily in writing), two eating periods that together total at least 30 minutes within the same period of five consecutive hours.
For further details about eating periods, see ESA Part VII, s. 20.
However, under s. 5 of O Reg 390/05, there are circumstances in which the eating periods provision of the ESA 2000 do not apply.
Section 5 of O Reg 390/05 provides that s. 20 of the Employment Standards Act, 2000 does not apply in certain circumstances.
Section 20 of the ESA 2000 states:
Under s. 20, an employer is required to provide an eating period of at least 30 minutes, timed so that no employee works longer than five consecutive hours without receiving an eating period, or, if the employer and employee agree (not necessarily in writing), two eating periods that together total at least 30 minutes within the same period of five consecutive hours.
Under s. 5 of O Reg 390/05, s. 20 of the Act does not apply to an employee who:
If an employee working a straight shift or a split shift did not either choose to work that shift or choose to work whatever shift the employer assigned, s. 20 would still apply and he or she would be entitled to a meal break in accordance with that section.
Note that, unlike the operation of s. 4 of O Reg 390/05, there is no requirement under s. 5 that the employer and employee (or union) agree that s. 5 of O Reg 390/05 will apply instead of s. 20 of the ESA 2000.
O Reg 398/09 sets out transitional rules for the application of the termination and severance provisions to assignment employees under Part XVIII.1 of the Employment Standards Act, 2000. While most of the regulation is now of historical interest only, it is important to note that the regulation provides that time on lay-off prior to November 6, 2009 is excluded for the purposes of determining when a termination/severance occurs under Part XV but clarifies that time employed prior to November 6, 2009 is included when determining entitlements under Part XV.
O Reg 398/09 is a defined industry regulation for the temporary help agency industry.
Section 2 provides that the scope of the regulation is limited to temporary help agencies and their assignment employees. The terms “temporary help agency” and “assignment employee” are defined in ESA Part I, s. 1(1).
Section 3 states that the regulation sets out transitional terms and conditions for applying Part XVIII.1 of the Employment Standards Act, 2000.
Section 4 provides that for the purposes of defining a temporary lay-off in s. 56(2), only a lay-off or part of a lay-off that occurs after November 5, 2009 is to be taken into account. As a result, only weeks of lay-off that commence on or after November 6, 2009 are counted for the purposes of determining whether a lay-off exceeds a period of temporary lay-off, thereby triggering a termination under s. 56(1)(c).
Similarly, for the purposes of the 20-consecutive week period or 52-consecutive week period within which more than 13 or 35 weeks or more of lay-off respectively must fall, only those weeks that begin on or after November 6, 2009 are taken into account.
Section 5 clarifies that for the purposes of s. 56(5), in cases where a layoff commenced prior to November 6, 2009, the deemed termination date will be November 6, 2009.
Section 56(5) of the Employment Standards Act, 2000 provides that where a termination is triggered because of a lay-off that exceeds a period of temporary lay-off, the employment is deemed to have been terminated on the first day of the lay-off.
As a result, if a lay-off commenced prior to November 6, 2009 and the number of weeks of lay-off that occurred on or after November 6, 2009 are sufficient to trigger a termination in accordance with s. 56(1)(c) (i.e., more than 13 weeks in a period of 20 consecutive weeks or 35 weeks in a period 52 consecutive weeks) the deemed termination date will be November 6, 2009 rather than the first day of the lay-off.
Section 6 provides that with respect to applying the mass notice provisions to assignment employees, the four-week periods within which the 50 or more terminations must occur in order to trigger mass notice entitlements must end before November 6, 2009 or begin on or after November 6, 2009.
As a result of this section and paragraphs 4.1 through 4.3 of s. 74.11, s. 58(1) of the Employment Standards Act, 2000 and s. 3(1) of O Reg. 288/01 would apply to determine the mass notice entitlements of assignment employees if they were one of at least 50 employees terminated in a four-week period ending before November 6, 2009, assuming they were not exempt from notice because they were an "elect to work" employee. Paragraphs 4.2 and 4.3 of s. 74.11 would apply to determine the mass notice entitlements of assignment employees if they were terminated in a four-week period beginning on or after November 6, 2009. For a discussion of how mass notice entitlements are triggered pursuant to s. 58(1) of the Act see ESA Part XV, s. 58. For a discussion of how mass notice entitlements are triggered pursuant to paragraphs 4.2 and 4.3 of s. 74.11, see ESA Part XVIII.1, s. 74.11.
Subsection 7(1) provides that for the purposes of determining whether a severance of employment has been triggered in accordance with s. 63(1)(c), only a lay-off or part of a lay-off that occurs after November 5, 2009 is to be taken into account. Section 63(1)(c) defines a severance as occurring when an employer lays an employee off for 35 weeks or more in any period of 52 consecutive weeks. Similarly, for the purposes of the 52-consecutive week period within which the 35 weeks of lay-off must fall, only those weeks that begin on or after November 6, 2009 are taken into account.
Subsection 7(2) provides that for the purposes of determining whether a severance has been triggered in accordance with s. 63(1)(d), only a lay-off that occurs after November 5, 2009 is to be taken into account. Section 63(1)(d) defines a severance as occurring when an employee lays an employee off because of a permanent discontinuance of all of the employer’s business at an establishment.
Finally, s. 7(3) provides that where a severance is triggered under s. 63(1)(e), only a notice of termination given after November 5, 2009 is to be taken into account. Section 63(1)(e) defines a severance as occurring when an employer gives an employee notice of termination as required under s. 57 or s. 58 of the Employment Standards Act, 2000 and the employee resigns, giving the employer at least two weeks' written notice of the resignation, with such notice to take effect during the statutory notice period.
Subsection 8(1) clarifies that nothing in this regulation can be construed to exclude time spent with an agency prior to November 6, 2009 for the purposes of determining entitlements under Part XV that vary with or are dependent on how long an assignment employee has been employed by a temporary help agency.
Subsection 8(2) states that as a result, references to "period of employment", "continuous employment" or "employment, whether or not continuous and whether or not active" and references to "number of years or months of employment" in Part XV will include employment with an agency prior to November 6, 2009.
This regulation came into effect on November 15, 2018.
Pursuant to this regulation, the ESA 2000 does not apply to a player on a major junior ice hockey team
, if the conditions set out in subsection (2) are met.
The regulation applies only to the major junior ice hockey team’s hockey players. It does not apply to any other individual on a major junior ice hockey team (e.g. equipment managers, trainers, coaches).
The Program is aware of major junior ice hockey teams in the Ontario Hockey League, although there may be others. However, in order for the ESA 2000 to not apply pursuant to this regulation, the condition in subsection (2) must be met.
The ESA 2000 will not apply only if the player on a major junior ice hockey team and the team – or the league in which the team is a member – have entered into an agreement (which pursuant to s. 1(3) of the ESA 2000 must be in writing) that provides that the player is entitled to receive a scholarship for a post-secondary educational program.
The agreement must provide a scholarship for each season the player plays on the team for the condition to be met.
The condition can be met even if the agreement contains eligibility criteria that the player must meet in order to qualify for the scholarship. The regulation does not establish any restrictions on the eligibility criteria that can be included in the agreement and does not establish any minimum amount of money that must be paid in order to qualify as a scholarship.
The condition will be met so long as there is a written agreement in place that contains provisions that provide for the scholarship; it does not matter whether the player ultimately meets the criteria and receives a scholarship.
There may be a period of time where an individual is a player on a major junior ice hockey team but has not entered into a written agreement that meets the condition set out in subsection (2). If there is an employment relationship during that period of time, the ESA 2000 will apply during that period.
This regulation sets out special rules regarding the terms and conditions of employment for employees employed in in the provision of land ambulance services or air ambulance services as defined in the Ambulance Act, RSO 1990, c A.19. Currently, the regulation’s scope is limited to hours free from work and eating periods.
O Reg 491/06 came into effect on October 20, 2006.
Section 1 defines the industry to which O Reg 491/06 applies to mean the industry of providing land or air ambulance services as defined in the Ambulance Act, RSO 1990, c A.19.
"Land ambulance services" and "air ambulance services" as defined in s. 1 of the Ambulance Act includes all services provided by an ambulance service in connection with the transportation of persons by land and air respectively. The definitions would not include a patient transfer service that provides transportation only for medically stable patients not suffering from a trauma or an acute onset of illness that could endanger their life, limb or function.
Section 1 of the Ambulance Act defines "emergency medical attendant" as a person employed by or a volunteer in an ambulance service who meets the qualifications for an emergency medical attendant as set out in the regulations, but does not include a paramedic or a physician, nurse or other health care provider who attends on a call for an ambulance.
Section 1 of the Ambulance Act defines "paramedic" as a person employed by or a volunteer in an ambulance service who meets the qualifications for an emergency medical attendant as set out in the regulations, and who is authorized to perform one or more controlled medical acts under the authority of a base hospital medical director, but does not include a physician, nurse or other health care provider who attends on a call for an ambulance.
Section 2 narrows the scope of O Reg 491/06 by restricting its application to unionized employees who work as emergency medical attendants or paramedics as defined in the Ambulance Act, RSO 1990, c A.19. The regulation does not apply to other employees in the industry such as dispatchers or clerical workers, and would not apply to emergency medical attendants or paramedics who are not represented by a union.
Section 3 states that O Reg 491/06 sets out terms and conditions of employment that apply to employers and employees in the defined industry of ambulance services.
Section 4(1) of O Reg 491/06 provides that, where the employer and the bargaining agent in the defined industry agree, s. 4(2) applies instead of s. 18(1) of the Employment Standards Act, 2000. Section 18(1) reads as follows:
Under s. 4(2) of O Reg 491/06, the period of at least 11 consecutive hours free from performing work in each day (in s. 18(1) of the Act) is replaced by a period of at least eight consecutive hours free from performing work in each day. See ESA Part VII, s. 18(1) for a discussion of the meaning of "day".
There can be no substitution of s. 4(2) for s. 18(1) of the Act unless the employer and the bargaining agent agree. Agreements to substitute s. 4(2) for s. 18(1) of the Act must be in writing in order to be valid. See ESA Part I, s. 1(3) and s. 1(3.1) for a discussion of the requirements regarding written agreements.
Like s. 18(1) of the Act, which it replaces, the provision for daily rest in s. 4(2) of O Reg 491/06 is an employment standard as defined in s. 1(1) of the Act and cannot be contracted out of or waived (s. 5(1)). The employer and the bargaining agent could not, for example, agree to a daily rest period of six hours.
For a discussion on how the 11-hour daily rest operates, see ESA Part VII, s. 18(1). Substitute "8 hours" for "11 hours" each time it appears in order to understand the operation of the eight-hour daily rest period under s. 4(2) of O Reg 491/06.
The requirement in s. 4(2) for at least eight consecutive hours off work in each day operates together with the hours of work provisions in sections 17, 18 and 19 of Part VII of the Act.
Section 18(2) of the ESA 2000 sets out an "on-call exception" to s. 18(1) of the Act. This exception also applies if the daily rest period is eight consecutive hours as per s. 4(2) of O Reg 491/06, when it replaces the 11-hour daily rest requirement in s. 18(1) in the defined industry.
Under s. 18(2), the requirement that an employee have at least 11 hours free from performing work in each day (in accordance with s. 18(1) of the Act) or at least eight hours free from performing work in each day (in accordance with s. 4(2) of O Reg 491/06) does not apply to an employee who is on call and is called in during a period he or she would not otherwise have been expected to work. The on-call exception is an exception only to the requirement to provide 11 or eight consecutive hours free from work each day as per s. 18(1) of the Act or s. 4(2) of O Reg 491/06. It does not operate as an exception to any other hours of work provisions.
For a discussion of the on-call exception, see ESA Part VII, s. 18(2). Substitute s. 4(2) of O Reg 491/06 for s. 18(1) of the Act, and substitute eight hours for 11 hours, wherever the references appear.
Section 17(1) of the ESA 2000 provides for maximum daily hours of work of eight hours per day or, if there is an established workday that is longer than eight hours, the number of hours in that work day. However, under s. 17(2) of the Act, employers and employees (or bargaining agents) can agree, in writing, that the employee will work up to a specified number of hours in excess of the daily limit. For such an agreement to be valid, s. 17(5) requires that non-unionized employees first be provided with a copy of the Ministry of Labour’s information sheet on hours of work and overtime and that the agreement contains a statement by the employee acknowledging such receipt.
For further details about the maximum daily hours of work, agreements to vary from the maximum daily hours and the requirement to provide the Ministry’s information sheet, see ESA Part VII, s. 17.
Section 17(1) of the ESA 2000 provides for maximum weekly hours of work of 48 hours. In order for hours in excess of 48 hours to be worked, the employer and employee (or bargaining agent) must agree, in writing, that the employee will work up to a specified number of hours in excess of the weekly limit. For such an agreement to be valid, s. 17(5) requires that non-unionized employees first be provided with a copy of the Ministry of Labour's information sheet on hours of work and overtime and that the agreement contains a statement by the employee acknowledging such receipt.
For further details about the maximum weekly hours, agreements to vary from the maximum weekly hours and the requirement to provide the Ministry's information sheet, see ESA Part VII, s. 17. For a discussion of agreements to work in excess of 48 hours per week and the approval of the Director of Employment Standards, see ESA Part VII, ss. 17(3) to 17.3(1).
Section 18(3) of the Act requires employers to provide employees with a minimum period free from work of eight hours between successive shifts, with two exceptions. First, an employee may work successive shifts without the eight-hour free period if the total number of hours worked on the successive shifts is 13 or less. Second, the employer and employee (or bargaining agent) can agree, in writing, to forego the eight-hour period entirely or to reduce its length. For a discussion of the interaction of s. 18(3) with the required daily rest in s. 18(1) of the Act, see ESA Part VII, s. 18(3).
Per s. 4 of O Reg 491/06, a bargaining agent and employer in the defined industry could agree in writing to a minimum daily rest of 8 eight hours (instead of the 11 hours in s. 18(1) of the Act). The bargaining agent could then agree in writing to work an eight and a 10-hour shift back to back, without any break between them. The agreement in writing would comply with s. 18(3) of the Act, but if it resulted in employees receiving a daily rest of less than eight consecutive hours (per the agreement under s. 4 of O Reg 491/06), the schedule would be in violation of O Reg 491/06 and, therefore, would not be permitted. In other words, the bargaining agent in the defined industry cannot agree to have employees work hours under s. 18(3) of the Act that would result in the employee getting less than the eight consecutive hours free from work each day stipulated in s. 4(2) of O Reg 390/05.
Section 18(4) of the ESA 2000 establishes weekly or bi-weekly free time requirements for employees. The free time periods must be at least either 24 consecutive hours in every "work week" or 48 consecutive hours in every two consecutive "work weeks".
See ESA Part VII, s. 18(4) for a discussion of the weekly/bi-weekly rest period provisions.
Section 19 of the ESA 2000 allows employers to require employees to work more daily or weekly hours than are permitted under s. 17 of the Act, or to work during a free period (daily, in between shifts and weekly or bi-weekly) as required by s. 18 of the Act (and s. 4(2) of O Reg 491/06) in any of the specified circumstances, but only so far as is necessary to avoid serious interference with the ordinary working of the employer’s establishment or operations.
For a discussion of the exceptional circumstances, see ESA Part VII, s. 19.
Section 5 of O Reg 491/06 provides that s. 20 of the Employment Standards Act, 2000 does not apply in certain circumstances. Section 20 of the ESA 2000 states:
Under s. 20, an employer is required to provide an eating period of at least 30 minutes, timed so that no employee works longer than five consecutive hours without receiving an eating period, or, if the employer and employee agree (not necessarily in writing), two eating periods that together total at least 30 minutes within the same period of five consecutive hours.
Section 5(1) of O Reg 491/06 provides that the requirement under s. 20 of the ESA 2000 does not apply if the employer and bargaining agent agree in writing to a term that addresses the employees’ entitlements to an eating period in one of the ways described in s. 5(2).
This regulation sets out special rules regarding the terms and conditions of employment for employees employed in the automobile manufacturing, automobile parts manufacturing, automobile parts warehousing and automobile marshalling industries. Currently, the regulation’s scope is limited to hours free from work and personal emergency leave.
O Reg 502/06 came into effect on November 3, 2006. Section 1(1) sets out the definitions for the purposes of the regulation.
Section 1(1) defines the industries to which O Reg 502/06 applies, to mean the industries of automobile manufacturing, automobile parts manufacturing, automobile parts warehousing, and automobile marshalling. See, however, O Reg 502/06, s. 2, which narrows the scope of application of the regulation to employees in the defined industries who are directly involved in the activities set out in the industry definitions.
Section 1(1) defines "automobile manufacturing" to mean assembling automobiles. Automobile has its regularly understood meaning, but also includes vans and trucks with a Gross Vehicle Weight Rating of 14,000 pounds (6350 kg) or less.
Section 1(1) defines "automobile marshalling" to mean the receiving of assembled automobiles from automobile manufacturers, storing the automobiles before delivery to purchasers or persons who sell to purchasers, organizing automobiles for delivery and arranging for delivery.
Section 1(1) defines "automobile parts manufacturing" to mean producing automobile parts that are supplied directly to employers in the automobile manufacturing industry or the automobile parts warehousing industry. It also includes producing elements of automobile parts that are supplied directly to automobile parts producers. An example of a part supplied to an automobile manufacturer might be a tire. An example of an element of a part supplied to parts manufacturer might be a rim that is supplied to the tire manufacturer. In the industry, those who produce parts supplied directly to automobile manufacturers are commonly called "Tier One" parts manufacturers, while those who produce elements of parts supplied to Tier One manufacturers are commonly called "Tier Two" parts manufacturers.
"automobile parts warehousing" means receiving automobile parts from employers in the automobile parts manufacturing industry, storing the parts before delivery to employers in the automobile manufacturing industry, organizing them for delivery, and delivering them or arranging for delivery;
Section 1(1) defines "automobile parts warehousing" to mean receiving automobile parts from automobile parts manufacturers, storing the parts before delivery to employers in the automobile manufacturing industry, organizing the parts for delivery and delivering them or arranging for delivery.
Section 1(1) defines “qualified health practitioner” to mean a person who is qualified to practise as a physician (a medical doctor), a registered nurse or a psychologist either under the laws of Ontario or another jurisdiction in which care or treatment is being provided to the employee or a relative of the employee.
Where care or treatment is provided in Ontario:
Where care or treatment is provided in a jurisdiction other than Ontario, the question of whether the person providing it is a “qualified health practitioner” is determined with reference to the laws of that other jurisdiction.
Section 1(2) states that for the purposes of O Reg 502/06, a person is employed in the defined industries if his or her employer engages in the activities as set out in the definition of automobile marshalling industry and the automobile parts warehousing industry, even if other activities constitute the majority of the employer’s activities. It similarly states that a person is employed in the automobile parts manufacturing industry if his or her employer produces any automobile parts or elements of automobile parts that are supplied as described in the definition of automobile parts manufacturing, even if the production of other things constitutes the majority of the employer’s production.
Section 2 narrows the scope of O Reg 502/06 by restricting its application to employees employed in the defined industries:
While generally it will be fairly obvious whether an employee is directly involved in an activity referred to in the industry definition, determining whether an employee who is not directly involved is nevertheless doing work that is essential to such an activity can be more difficult. Examples of employees who may be considered to be doing such work include:
Examples of employees who would generally not be considered to be doing work that is essential to activity referred to in the industry definition include employees who:
Section 3(1) of O Reg 502/06 provides that, where the employer and employee in the defined industries agree, ss. 3(2) and (3) applies instead of s. 18(1) of the Employment Standards Act, 2000. Section 18(1) reads as follows:
Under ss. 3(2) and (3), if the employer and the employee (or bargaining agent representing employees) agree in writing, the daily rest period on one day in each work week may be shorter than eleven consecutive hours but must be at least eight consecutive hours. On all other days of the work week, the daily rest period must be at least eleven consecutive hours.
Like s. 18(1) of the Act, the daily rest requirements in s. 3(2) and s. 3(3) of O Reg 502/06 constitute an employment standard as defined in s. 1(1) of the Act and cannot be contracted out of or waived (s. 5(1)). For example, an employer and employee (or bargaining agent) in the defined industries could not agree to a six-hour daily rest period on one day in each work week or to have two days each work week with an eight-hour daily rest period.
For a discussion on how the 11-hour daily rest operates, see ESA Part VII, s. 18(1).
The requirement in s. 3(2) and s. 3(3) to allow for at least eight consecutive hours off work on one day in a work week and 11 consecutive hours off on all other days in that work week operates simultaneously with the hours of work provisions in Part VII of the Act, as follows:
Section 18(2) of the ESA, 2000 sets out an "on-call exception" to s. 18(1) of the Act. This exception also applies if the daily rest period for one day in the work week is between eight and 11 consecutive hours and 11 consecutive hours for all other days in the work week in accordance with s. 3(2) and s. 3(3) of O Reg 502/06.
Under s. 18(2), the requirement that an employee have at least 11 hours free from performing work in each day (in accordance with s. 3(2) of O Reg 502/06) and at least eight hours free from performing work on one day each work week (in accordance with s. 3(3) of O Reg 502/06) does not apply to an employee who is on call and is called in during a period he or she would not otherwise have been expected to work. The on-call exception is an exception only to the requirement to provide 11 or eight consecutive hours free from work each day as per s. 18(1) of the Act or s. 3(2) and s. 3(3) of O Reg 502/06. It does not operate as an exception to any other hours of work provisions.
For a discussion of the on-call exception, see ESA Part VII, s. 18(2).
Section 17(1) of the ESA 2000 provides for maximum daily hours of work of eight hours per day or, if there is an established workday that is longer than eight hours, the number of hours in that work day. However, under s. 17(2) of the Act, employers and employees can agree, in writing, that the employee will work up to a specified number of hours in excess of the daily limit. For such an agreement to be valid, s. 17(5) requires that non-unionized employees first be provided with a copy of the Ministry of Labour’s information sheet on hours of work and overtime and that the agreement contains a statement by the employee acknowledging such receipt.
For further details about the maximum daily hours of work, agreements to vary from the maximum daily hours and about the requirement to provide the Ministry’s information sheet, see ESA Part VII, s. 17.
Section 17(1) of the ESA 2000 provides for maximum weekly hours of work of 48 hours. However, under s. 17(3) of the Act, employers and employees can agree, in writing, that the employee will work up to a specified number of hours in excess of the weekly limit.. For such an agreement to be valid, s. 17(5) requires that non-unionized employees first be provided with a copy of the Ministry of Labour's information sheet on hours of work and overtime and that the agreement contains a statement by the employee acknowledging such receipt.
For further details about the maximum weekly hours, see ESA Part VII, s. 17(1). For a discussion of agreements to work in excess of 48 hours per week, agreements to vary from the maximum weekly hours and about the requirement to provide the Ministry's information sheet, see ESA Part VII, s. 17.
Section 18(3) of the Act requires employers to provide employees with a minimum period free from work of eight hours between successive shifts, with two exceptions. First, an employee may work successive shifts without the eight-hour free period if the total number of hours worked on the successive shifts is 13 or less. Second, the employer and employee can agree, in writing, to forego the eight-hour period entirely or to reduce its length. For a discussion of the interaction of s. 18(3) with the required daily rest in s. 18(1) of the Act, see ESA Part VII, s. 18(3).
Per s. 3 of O Reg 502/06, an employee and employer in the defined industry could agree in writing to a minimum daily rest of 8 eight hours on one day during each work week and 11 hours of daily rest on all other days in the work week (instead of the 11 hours in s. 18(1) of the Act). That employee could, under s. 18(3) of the Act, then agree in writing to work an eight and a 10-hour shift back to back, without any break between them. The agreement in writing would comply with s. 18(3) of the Act, but if it resulted in the employee receiving a daily rest of less than eight consecutive hours on the one day or 11 consecutive hours on the other days in the work week (per the agreement under s. 3 of O Reg 502/06), the schedule would be in violation of O Reg 502/06 and, therefore, would not be permitted. In other words, an employee in the defined industry cannot agree to work hours under s. 18(3) of the Act that would result in the employee getting less than the eight consecutive hours free from work on one day and 11 consecutive hours free from work on all other days during the work week as stipulated in s. 3(2) and s. 3(3) of O Reg 502/06.
Section 18(4) of the ESA 2000 establishes weekly or bi-weekly free time requirements for employees. The free time periods must be at least either 24 consecutive hours in every "work week" or 48 consecutive hours in every two consecutive "work weeks".
See ESA Part VII, s. 18(4) for a discussion of the weekly/ biweekly rest period provisions.
Section 19 of the ESA 2000 allows employers to require employees to work more daily or weekly hours than are permitted under s. 17 of the Act, or to work during a free period (daily, in between shifts and weekly or biweekly) as required by s. 18 of the Act (and s. 3(2) and 3(3) of O Reg 502/06) in any of the specified circumstances, but only so far as is necessary to avoid serious interference with the ordinary working of the employer’s establishment or operations.
For a discussion of the exceptional circumstances, see ESA Part VII, s. 19.
Under s. 20 of the ESA 2000, an employer is required to provide an eating period of at least 30 minutes, timed so that no employee works longer than five consecutive hours without receiving an eating period, or, if the employer and employee agree (not necessarily in writing), two eating periods that together total at least 30 minutes within the same period of five consecutive hours.
For further details about eating periods, see ESA Part VII, s. 20.
Note that this section was revoked effective January 1, 2019. As of January 1, 2019, the provisions of s. 50 (sick leave), s. 50.0.1 (family responsibility leave) and s. 50.0.2 (bereavement leave) apply to employees within the defined industries as established by s. 1.
The discussion of this section — which established special rules relating to the now-repealed personal emergency leave standard that was formerly in s. 50 —– is being maintained in this publication since employees may still have a complaint relating to a situation that arose when section 4 was in force. The text appears in red to highlight that this section has been revoked.
Note that this text relates to s. 4 as it read from January 1, 2018 to December 31, 2018. (Section 4 read differently prior to January 1, 2018.)
Subsection 4(1) of O Reg 502/06 specifies that s. 4 creates special rules relating to personal emergency leave for employees employed in the defined industries.
For employees in the defined industries who are eligible for personal emergency leave, the special rules modify the number of days to which they are entitled and provides an exemption from the right to be paid for the first two days of personal emergency leave in each calendar year if certain criteria are met. All the other aspects of personal emergency leave will apply, such as the right of reinstatement to the same job after the leave, anti-reprisal protection and the requirement of the employer to continue benefit contributions, etc., as specified in ESA Part XIV, ss. 51-53 .
Like ESA Part XIV, s. 50, which it modifies, the provision for personal emergency leave in O Reg 502/06, s. 4 is an employment standard as defined in ESA Part I, s. 1(1) and cannot be contracted out of or waived as per ESA Part III, s. 5(1). However, this prohibition is subject to the greater right or benefit provision established by ESA Part III, s. 5(2). Accordingly, an employment standard need not be complied with if the employee is receiving a greater right or benefit with respect to that particular standard. The principle that applies in making the determination is the same principle that governs in any greater right or benefit determination, i.e., do the relevant contractual provisions, taken in their entirety, give the employee a better deal than the corresponding employment standard taken in its entirety.
If an employer’s benefit is considered a greater right or benefit than that created under O Reg 502/06 it will be enforced by the Program. For more information on the greater right or benefit analysis, see ESA Part III, s. 5(2) and the specific commentary on greater right or benefit in the context of personal emergency leave.
Note that if an employer offers a benefit plan for sick days, bereavement days, etc., and the employee opts to claim benefits under that plan, it is Program policy that the employee has in effect designated the absence also as a personal emergency leave day (unless the employee is also entitled to another leave under the Employment Standards Act, 2000, e.g., domestic or sexual violence leave. In that case, the employee is free to decide which leave to designate) and it will reduce the employee’s personal emergency leave entitlement accordingly. For example, if an employer offers three paid sick days under a benefits plan and the employee is absent three days because of the flu and claims benefits under the plan, the employee is considered to have used three of their personal emergency leave days.
Note also that there is nothing in the ESA 2000 or O Reg 502/06 that would prohibit an employer from subtracting any personal emergency leave days that are taken from any paid days provided by a benefit plan offered by an employer. Notably, while this is not prohibited under the ESA 2000, an employment contract may address the issue of whether any personal emergency days count against any contractual leave entitlements.
Employees in the defined industries are entitled to a maximum limit of seven days of personal emergency leave per calendar year as a result of any of the events in paragraphs 1, 2 and 3 occurring. The triggering events are the same as those established in ESA Part XIV, s. 50. For more information regarding the definition of a “personal illness, injury or medical emergency” or “urgent matter”, please refer to ESA Part XIV, s. 50(1), paras. 1 to 3.
The question arises as to whether the seven day entitlement should be prorated for employees who started their employment partway through a calendar year. As per ESA Part XIV, s. 50, which it modifies, there is nothing in O Reg 502/06, s. 4 to suggest that employees who are eligible for personal emergency leave should be entitled to less than seven days a calendar year in this situation. Accordingly, it is Program policy that there should be no pro-rating of the seven day entitlement.
In addition to the entitlement of up to seven days of personal emergency leave within a calendar year because of personal illness, injury or medical emergency, or the illness, injury, medical emergency or urgent matter of a specified list of relatives, employees are entitled to take personal emergency leave of up to 3 days because of the death of a person described in paragraphs 1 to 7 of s. 4(4). Note that as in the general personal emergency leave provisions outlined in ESA Part XIV, s. 50, this group of relatives does not include an uncle or an aunt of the employee, unless that individual is dependent on the employee for care and assistance.
The entitlement to a leave “because of the death of an individual” is up to three days per incident: if an employee’s brother and parent died in the same calendar year, the employee would be entitled to up to six days of unpaid personal emergency leave. If the same employee had a health crisis and needed to take seven days of leave due to a medical emergency, they would be entitled to a total of 13 days of personal emergency leave within a calendar year, instead of the 10 days that the employee would have normally been entitled to per ESA Part XIV, s. 50. If no death of any person described in s. 4(4) occurs within a calendar year, the maximum entitlement to personal emergency leave for reasons other than a death as specified in s. 4(2) is seven days. The employee would not be entitled to “use” the bereavement portion of the personal emergency leave for any other purpose than the death of an individual described in s. 4(4).
This subsection defines the group of individuals who will be considered a “relative” for the purposes of O Reg 502/06. It is identical to the list of relatives found at ESA Part XIV, s. 50(2).
Subsection 4(5) requires employees to notify their employers ahead of time that they will be taking personal emergency leave. If the employee is not able to provide notice before taking the leave, they will be required to notify the employer “as soon as possible” after commencing the leave. The same requirements exist in relation to the general provisions of personal emergency leave at ESA Part XIV, s. 50; similarly, the Program takes the position that if an employee fails to provide notice to the employer (either before or after starting the leave), the entitlement to the leave will not be invalidated. For more information on these sections, please see the commentary at ESA Part XIV, s. 50(3).
4(9) The two days of paid leave mentioned in subsection (7) must be taken first in a calendar year before any of the days of unpaid leave can be taken under this section.
Subsections (7), (8) and (9) are nearly identical to ESA Part XIV, ss. 50(5), (6) and (8). Subsection 4(7) specifies that the first two days of personal emergency leave taken in the calendar year must be paid, while the remainder of the days taken are unpaid. Subsection 4(8) establishes the rule for new employees who have been employed by the employer for less than one week, and s. 4(9) clarifies that the paid days of leave are to be taken before the unpaid days in a calendar year in the case of employees who have been employed for one week or longer. See the commentary at ESA Part XIV, s. 50(5), s. 50(6) and s. 50(8).
Subsection 4(10) provides a special rule that applies when a contract of employment contains particular terms. If the contract of employment provides for any of the entitlements in ss. 4(1) paragraphs 1(i), 1(ii) or 1(iii), then the employer is not obligated to pay the employee for the first two days of personal emergency leave taken within a calendar year.
Note that the contract of employment may contain “two or more days as one or more of the following”, meaning that the contract can “mix and match”, and meet the requirement by providing one extra day of vacation and one personal sick day, for example. At least two days in total must be given by the contract, but they can be any combination of vacation, holiday or days for personal illness/personal medical appointments so long as they are paid in accordance with s. 4(10) paragraph 2.
Section 4(10) paragraph 1(i) refers to paid vacation days in excess of the basic entitlements of ESA Part XI. If a contractual entitlement provides something less than what an employee would get under ESA Part XI in terms of the number of days (for example, a paid vacation day subject to a “use it or lose it” requirement), then it will not meet the requirements of s. 4(10) paragraph 1(i) and the employee will be entitled to paid personal emergency leave.
Section 4(1) paragraph 1(ii) refers to “holidays in excess of the employee’s entitlement under Part X of the Act”. This may include additional holidays that are not defined public holidays under the ESA 2000, such as the August Civic holiday or Remembrance Day, or company holidays, for example, when an employer shuts down operations between Christmas Day and New Year’s Day, or provides an additional company-wide holiday on the Friday before a public holiday under the ESA 2000. However, for an employer to rely on s. 4(10) paragraph 1(ii), note that the employee must be paid at least the amount specified in s.4 (10) paragraph 2.
If the contract of employment contains one or more days for the employee to take a day off due to personal illness or to attend a personal medical appointment, and the day is paid in accordance with s. 4(10) paragraph 2, the employee will not be entitled to paid personal emergency leave. In order to qualify, the day or days provided by the contract of employment must include personal illness or a personal medical appointment as a valid use, but can include other purposes (for example, for the illness of a child or for a non-medical use).
If an employment contract provides for excess vacation days, company holidays or personal illness days, the employer will not be able to rely on the exemption from paid days of personal emergency leave unless the days provided by the contract are paid. Section 4(10) paragraph 2 specifies how much the employee must be paid for these days in order for them to qualify, and the approach is similar to that taken for the calculation of public holiday pay. The amount of pay for the day must be something similar to what the employee would be paid for a regular day of work: it must be no less than the regular wages earned in the pay period before the day (whether it is a company holiday, vacation day, or personal illness day) divided by the number of days the employee worked in that period.
As “regular wages” is a defined term and does not include vacation pay, if the employee is on vacation for the entire pay period preceding the day, then the amount the employee must be paid will be based on the regular wages earned in pay period prior to the vacation.
This subsection clarifies that if an employee is not entitled to be paid for the first two days of personal emergency leave taken in the calendar year because the employee’s contract of employment contains at least two of the days described in s. 4(10), the employee still has the right to take personal emergency leave without pay.
This subsection allows the employer to count any part of a day taken as personal emergency leave as a full day for the purpose of determining how much leave an employee has taken, and how much leave they have remaining in a calendar year. The employer is not obligated to do so: for example, if an employee takes half of a day to attend a funeral of a relative who meets any of the requirements determined by O Reg 502/06, the employer may either consider the employee to have taken the exact number of hours the employee was absent, or the entire day. If the employer chooses to designate the absence as a full day of personal emergency leave, the employee would, of course, remain entitled to be paid wages for any hours actually worked on the day of deemed leave. If the day of leave was one of the first two taken in the calendar year, the employee would be entitled to be paid personal emergency leave pay only for the hours taken as leave.
This subsection is identical to ESA Part XIV, s. 50(7) — refer to commentary on that section for more information.
This subsection defines the amount of personal emergency leave pay an employee who is eligible for paid leave is entitled to.
Subsection 4(13) is identical to the provisions of ESA Part XIV, s. 50(9). For more information on this section and examples of personal emergency leave pay calculation, please see the commentary at ESA Part XIV, s. 50(9).
Subsection 4(14) excludes overtime pay or a shift premium (for example, an extra amount paid for working evenings or weekends) from inclusion when calculating personal emergency leave pay. The employee would be entitled to be paid for hours of personal emergency leave using their regular rate of pay, and not for example 1.5 times their regular rate per the overtime provisions of the ESA 2000.
Under ESA Part X Public Holidays, employees who agree to, or are required to work on a public holiday may be entitled to receive premium pay of at least one and one half times their regular rate for hours worked on that day. The effect of this subsection is that, despite the entitlement in s. 4(13) to be paid “the wages the employee would have earned had they not taken the leave”, the employee is not entitled to any premium pay that they would have earned by working on the public holiday had the leave not been taken.
Subsections 4(14) and (15) are identical to the provisions of ESA Part XIV, s. 50(10) and (11). For more information on these sections and examples of personal emergency leave pay calculations involving overtime pay and shift premiums, see the commentary at ESA Part XIV, s. 50(10) and for examples of personal emergency leave pay calculations involving public holiday premium pay, see the commentary at ESA Part XIV, s. 50(11).
These subsections are identical to ESA Part XIV, s. 50(12) and (13) — refer to "personal emergency leave" commentary on those sections for more information.
This regulation sets out the conditions for when an employee takes family medical leave or critical illness leave with respect to a person who considers the employee to be like a family member.
The family medical leave provision in ESA Part XIV, s. 49.1(3) paragraph 12 and critical illness leave in the definition of family member at ESA Part XIV, s. 49.4(1) both define “family member” for the purpose of determining eligibility for the leave, and include “a person who considers the employee to be like a family member.”
If an employee wishes to take either critical illness leave or family medical leave to care for such a person, the employee must provide a copy of a “document provided to an agency or department of the Government of Canada for the purposes of claiming benefits under the Employment Insurance Act” to the employer if the employer requests it. At the time of writing, the Employment Insurance (“EI”) benefit that is available to employees who wish to take family medical leave is the compassionate care EI benefit, and in order to qualify for EI benefits when an employee takes family medical leave to care for someone who considers the employee to be like a family member, the employee must complete an attestation form for Service Canada. Whether or not the employee intends to apply for the EI benefit, it is this form that must be provided to the employer if the employer asks for it.
In the case of critical illness leave, the requirement is the same: if the employer requests a copy of the document that the employee provided to Service Canada to support an application for EI benefits to care for a critically ill family member when that person is someone who considers the employee to be like a family member, then the employee must provide it to the employer.
This regulation was in effect from December 17, 2020 until July 30, 2022. It was revoked on July 31, 2022. Information about O. Reg. 764/20 remains in this publication for reference purposes only.
O. Reg. 764/20 – Terms and Conditions of Employment in Defined Industries – Hospitality, Tourism and Convention and Trade Show Industries– came into effect on December 17, 2020. It was originally set to self-revoke on December 17, 2021, but was later extended to self-revoke on July 31, 2022.
O. Reg. 764/20 applies only to employees who are represented by a trade union, and employers of those employees, in the following industries: hospitality, tourism, and convention and trade show industries. It does not apply to the Crown and certain public bodies as defined in the regulation.
O. Reg. 764/20 creates a special rule that permits employers and trade unions to agree that the regulation applies instead of some of the provisions in s. 67 of the ESA. Section 67 of the ESA governs the interaction between recall rights, termination and severance pay and establishes a requirement for payment of termination pay and severance pay into trust where recall rights are retained. The agreement can be made with respect to a single employee, a group or groups of employees, or all employees.
If the employer and the trade union agree to have the regulation apply with respect to an employee, the requirement in s. 67(7) of the ESA that the employer pay the termination pay and severance pay to which the employee is entitled into trust will not apply. This exemption from the requirement to pay the money into trust happens automatically when the employer and trade union agree to apply the special industry rule.
Note that although the regulation does not require the employer to pay into trust the termination pay and severance pay to which the employee is entitled, the trade union and employer are not prohibited by the regulation from bargaining a trust arrangement with respect to any or all of the pay to which the employee is entitled. Unlike s. 67(7), the regulation does not contemplate that any such trust arrangement would involve paying the money into trust with the Director of Employment Standards. Therefore, the Director will not accept any money into trust where the regulation applies.
In addition, where the employer and the trade union agree to have the regulation apply with respect to an employee:
Where a trade union and employer agree to have the regulation apply with respect to an employee, if the employee individually elects to retain recall rights and the trade union does not elect to retain the right to recall on behalf of that employee, the only practical difference for that employee between being subject to the regulation and being governed by s. 67 is that there is no obligation on the employer to pay into trust the termination pay and severance pay to which the employee is entitled. (Note, however, that if the employee elected to retain recall rights before the trade union and employer agreed to have the regulation apply to that employee, the employer may have already paid the termination pay and severance pay into trust. In that case, where the money was paid to the Director of Employment Standards in trust, it will be held and released in accordance with s. 67 of the ESA. Where the money is being held in a private trust, it will be held and paid in accordance with the trust arrangement.)
This regulation was in effect from December 17, 2020 until July 30, 2022. It was revoked on July 31, 2022. Information about O. Reg. 764/20 remains in this publication for reference purposes only.
Section 1 defines the industries to which O. Reg 764/20, pursuant to s. 2, applies.
Section 1 provides a definition of “defined industries” (as referenced in s. 2) to mean the hospitality industry, the tourism industry and the convention and trade show industry. It also defines each of those industries.
The definitions of those three industries are inclusive. This means that there may be activities or businesses that are not explicitly set out within the definitions that fall within them.
This regulation was in effect from December 17, 2020 until July 30, 2022. It was revoked on July 31, 2022. Information about O. Reg. 764/20 remains in this publication for reference purposes only.
Subsection 2(1) narrows the scope of O. Reg. 764/20 by restricting its application to employees in the defined industries who are represented by a trade union, and to their employers.
It does not matter for the purpose of s. 2 whether or not the unionized employees are covered by a collective agreement. So long as the employees are represented by a trade union, the regulation applies.
If a trade union representing employees in one of the defined industries enters into an agreement with the employer pursuant to ss. 4(1) of this regulation and is subsequently decertified while this regulation is still in effect, the regulation would stop applying with respect to the employees who are no longer represented by a trade union on the date of the decertification, and s. 67 of the ESA 2000 would apply to the employees and employer as of that date.
Section 1 of the ESA 2000 defines “trade union” to be an organization that represents employees in collective bargaining under a number of labour relations statutes. See s. 1 of the ESA 2000 for details.
Subsection 2(2) further narrows the scope of O. Reg. 764/20 by providing that it does not apply to the Crown, a Crown agency or an authority, board, commission or corporation, at least one of whose members is appointed by the Crown, or to any employees of such an employer.
For a discussion of the exemption that applies to the Crown and certain public bodies in the context of ss. 4(4.1) of the ESA 2000 and s. 2.1 of O. Reg. 285/01, see O Reg 285/01 s. 2.1. Note, however, that the exemption in this regulation differs from the exemptions for the Crown and certain public bodies in the context of ss. 4(4.1) of the ESA 2000 and s. 2.1 of O. Reg. 285/01. In those contexts, all of the members of an authority, board, commission or corporation must be appointed by the Crown for the exemption to apply. Here, the regulation will not apply so long as at least one of the members has been appointed by the Crown.
This regulation was in effect from December 17, 2020 until July 30, 2022. It was revoked on July 31, 2022. Information about O. Reg. 764/20 remains in this publication for reference purposes only.
Section 3 states that O. Reg. 764/20 sets out terms and conditions of employment that apply to unionized employees and their employers in the industries defined in s. 1.
This section must be read in conjunction with ss. 4(1) of O. Reg. 764/20, which provides that the special rules regarding the application of recall rights in the regulation applies with respect to an employee only if the trade union and employer agree that it applies. If there is no such agreement, s. 67 of the ESA 2000 applies with respect to that employee. Depending on the agreement negotiated by the employer and trade union, it is possible that some unionized employees of an employer are governed by this regulation while other employees of the employer who are represented by the same trade union are governed by s. 67 of the ESA 2000.
This regulation was in effect from December 17, 2020 until July 30, 2022. It was revoked on July 31, 2022. Information about O. Reg. 764/20 remains in this publication for reference purposes only.
Subsection 4(1) of O. Reg. 764/20 provides that, if the employer and the trade union that represents an employee in the defined industries agree, subsections (2) to (7) of this regulation apply to that employer and employee instead of subsection 67 (3), (4), (5), (7), (8) and (9).
The trade union and employer can enter into an agreement with respect to a single employee, a group or groups of employees, or all employees: the regulation does not impose any restrictions in this regard.
If the employer and the trade union agree to have the regulation apply with respect to an employee, where an election to retain recall rights has been made the requirement in s. 67(7) of the ESA that the employer pay the termination pay and severance pay to which the employee is entitled into trust will not apply. This exemption from the requirement to pay money into trust happens automatically when the employer and trade union agree to apply the special industry rule.
Note that although the regulation does not require the employer to pay into trust the termination pay and severance pay to which the employee is entitled, the trade union and employer are not prohibited by the regulation from bargaining a trust arrangement with respect to any or all of the pay to which the employee is entitled. Unlike s. 67(7), the regulation does not contemplate that any such trust arrangement involves paying the money into trust with the Director of Employment Standards. Therefore, the Director will not accept any money into trust where the regulation applies.
In addition, where the employer and the trade union agree to have the regulation apply with respect to an employee:
Where a trade union and employer agree to have the regulation apply with respect to an employee, if the employee individually elects to retain recall rights and the trade union does not elect to retain the right to recall on behalf of that employee, the only practical difference for that employee between being subject to the regulation and being governed by s. 67 is that there is no obligation on the employer to pay into trust the termination pay and severance pay to which the employee is entitled.
The employer and trade union can enter into an agreement under this subsection with respect to an employee even if that employee already made an election to retain recall rights, and even if that employee made the election before O. Reg. 764/20 came into force. For example, if an employee elected to retain recall rights while subject to s. 67, the employer and trade union can subsequently enter into an agreement under this subsection with respect to that employee. If they do, the regulation applies rather than the system set out in s. 67. This means, for example, that upon entering into the agreement the employer is no longer subject to the requirement in ss. 67(7) to pay the employee’s termination and severance pay into trust, and as per ss. 4(4) of this regulation, where the union has made an election on behalf of some or all of the employees it represents, the employees may not renounce the employees’ right to be recalled and be paid termination and severance pay to which the employee is entitled before the date agreed to by the employer and union. Note that where money is already being held in trust by the Director of Employment Standards pursuant to s. 67 in respect of a particular employee, there is no authority for the Director to return those funds to the employer if the employer and union come to an agreement under this regulation in respect of that employee’s recall rights; the Director can only pay out the funds in accordance with s. 67 of the Act. Where money is being held in a private trust, it will be held and paid in accordance with the trust arrangement.
If the employer and trade union enter into an agreement under ss. 4(1) with respect to an employee, the provisions of the ESA 2000 and this regulation governing the interaction between recall rights and termination pay and severance pay that would apply to the employer and employee affected by the agreement are as set out below.
(Note: although ss. 67(6) of the ESA 2000 is not displaced when the employer and trade union enter into an agreement under ss. 4(1) of O. Reg. 764/20, the text of ss. 67(6) is not set out below because it applies only to non-unionized employees and as such is not relevant.)
ss. 67(1) of ESA 2000 This section** applies if an employee who has a right to be recalled for employment under his or her employment contract is entitled to,
ss. 67(2) of ESA 2000 Clause (1) (b) does not apply if the employer and employee have agreed that the severance pay shall be paid in instalments under section 66.
4. (2)Subject to subsections (3) and (4), the employee may elect to be paid the termination pay or severance pay forthwith or to retain the right to be recalled.
4. (3)If the employee is entitled to both termination pay and severance pay, the same election shall be made in respect of each.
4. (4)A trade union may elect to retain the right to be recalled on behalf of some or all of the employees it represents and if such an election is made, the following rules apply:
4. (5) If no election is made on an employee’s behalf under subsection (4) and the employee elects to be paid under subsection (2), the employee shall be deemed to have abandoned the right to be recalled.
4. (6) If the employee accepts employment made available under the right of recall, the employee shall be deemed to have abandoned the right to termination pay and severance pay.
4. (7) Subject to the limit set out in paragraph 2 of subsection (4), if the employee renounces the right to be recalled or the right expires, the employer shall pay the termination pay and severance pay to which the employee is entitled forthwith to the employee and, if the right to be recalled had not expired, the employee shall be deemed to have abandoned the right.
** Because ss. 4 (2)-(7) of O. Reg. 764/20 replace certain subsections of s. 67, the reference in ss. 67(1) of the ESA to “This section” means s. 67 and ss. 4(2)-(7) of O. Reg. 764/20.
Subsection 67(1) sets out the circumstances in which the provisions regarding the election of recall rights apply. This section is subject to s. 67(2) of the Employment Standards Act, 2000, discussed in subsection (2) below.
Subsection 67(1) states that s. 67 will apply where an employee has the right to be recalled for employment under a contract of employment (which includes a collective agreement) and either a) or b) below applies. (Where a trade union and employer agree to have O. Reg. 764/20 apply to an employee who falls under ss. 67(1), the reference in ss. 67(1) to “This section” means ss. 67(1), (2) and ss. 4(2)-(7) of O. Reg. 764/20.)
Employees who are entitled to termination pay because of a temporary lay-off that equals or exceeds 35 weeks in a period of 52 consecutive weeks (ss. 56(2)(b) or ss. 56(2)(c)) are subject to s. 67. In that case, the employer of such an employee is also subject to s. 67.
This section does not apply if the termination pay comes due for reasons other than as a result of a lay-off that equals or exceeds 35 weeks in a period of 52 consecutive weeks. Therefore, it will not apply where, for example, there is a termination because of a lay-off that exceeds 13 weeks in a 20-week consecutive period (ss. 56(2)(a)). In that case, the employee is not required under the Act to make an election in order to receive termination pay after 13 weeks of lay-off and will not be deemed under the Act to have abandoned the right to be recalled in accepting that payment. If the employee is entitled to severance pay, however, he or she will be required to make an election with respect to the payment of the severance pay and the retention of recall rights. It should also be noted that a collective agreement or contract of employment may provide for the loss of recall rights as a consequence of an employee’s acceptance of termination pay that comes due other than as a result of a lay-off that equals or exceeds 35 weeks in a period of 52 consecutive weeks.
Subject to ss. 67(2), employees who are entitled to severance pay under ss. 64(1) of the Act are subject to the provisions of s. 67. The employee's employer is likewise subject to the provisions of s. 67.
Section 67(2) provides that, despite ss. 67(1)(b), the provisions of s. 67 (and of ss. 4(2)-(7) of O. Reg. 764/20) will not apply with respect to the severance entitlement where an employer and an employee have agreed to pay an employee severance pay in instalments under s. 66. See ESA Part XV, s. 66 for a detailed discussion of severance instalment plans under s. 66 of the Act. As such, an employee who agrees to accept severance pay by instalment will not be required to make an election as between the payment of his or her severance pay and retaining the right to recall, and the employer will not be required to pay the severance pay into trust.
However, s. 67 and ss. 4(2)-(7) of O. Reg. 764/20 will apply where an instalment plan is in place because the Director has approved the payment of severance pay by instalments (as opposed to it being in place as a result of employee agreement). Accordingly, in that case, the employee must elect either to be paid the severance pay (by instalment) or retain his or her recall rights. If that employee also has the right to termination pay because of a lay-off of 35 weeks or more, the same election must be made with respect to both the termination pay and severance pay entitlements - see ss. 4(3) of O. Reg. 764/20. Note that if that employee does not make an election, or elects to be recalled, it is Program Policy that the employee has not abandoned the right to be recalled even though the employer pays the employee severance pay by instalment under a plan approved by the Director, since the employee has not expressly elected to be paid the severance pay under ss. 4(2) of O. Reg. 764/20.
This subsection provides that subject to ss. 4(3) and (4) of O. Reg. 764/20, an employee may choose to have the termination pay or severance pay to which the employee is entitled paid to him or her immediately, or instead may choose to retain the right to be recalled.
Subsection (3) provides that where an employee is entitled to both termination pay and severance pay, the employee must make the same election in respect of both of those payments.
Subsection (4) provides that a trade union may elect to retain the right to be recalled on behalf of some or all of the employees it represents, so long as the employee has not already elected to be paid termination or severance pay.
This provision does not apply with respect to the employee's severance pay entitlement if the employee and employer have agreed to (as opposed to the Director approving) the payment of severance pay by instalment under s. 66 of the Act. In that event, ss. 67(2) of the Act provides that the provisions of s. 67 - and ss. 4(2) of this regulation since it only applies where s. 67 is triggered - do not apply with respect to the severance pay entitlement.
As noted earlier, there is no provision in the regulation corresponding to the obligation in ss. 67(7) of the ESA 2000 requiring that, where recall rights are retained, the employer pay the termination pay and severance pay to which the employee is entitled into trust.
This subsection, combined with ss. 67(1), provides that if an employee is entitled to termination pay on or after 35 weeks of lay-off in a period of 52 consecutive weeks and to severance pay, the employee must make the same election with respect to both.
Note, however, that this requirement does not apply if the employee and employer have agreed to (as opposed to the Director approving) the payment of severance pay by instalment under s. 66 of the Act. In that event, ss. 67(2) of the Act provides that the provisions of s. 67 - and ss. 4(2) of this regulation since it only applies where s. 67 is triggered - do not apply with respect to the severance pay entitlement.
This subsection provides that the trade union may elect to retain the recall rights on behalf of one, some or all of the employees it represents, and establishes rules in paragraphs 1-3 with respect to that election.
Paragraph 1 of ss. 4(4) provides that such an election is binding on the employee in respect of whom the election is made unless the employee elected to be paid the termination and severance pay to which the employee is entitled before the trade union made the election. If an employee made the election to be paid first, that election stands and cannot be overridden by the trade union’s election.
That is the only situation under the regulation where the trade union’s election to retain the right of recall on behalf of an employee is not binding. A trade union may elect to retain the right of recall on behalf of an employee – and have the rules set out in paragraphs 1, 2 and 3 of this subsection apply – even if the employee had already elected to retain those rights pursuant to ss. 4(2) of this regulation or ss. 67(3) of the ESA (in the case where the employee made the election before the trade union and employer entered into an agreement under ss. 4(1) of this regulation to have the regulation apply to that employee, including a situation where the election was made before this regulation came into force).
Paragraph 2 of ss. 4(4) provides that if the trade union elects to retain the right to be recalled on behalf of an employee, that employee cannot renounce the right to be recalled before the date agreed to by the employer and the trade union.
If the employer and trade union do not agree on such a date, the employee may renounce the recall right and elect to be paid termination pay and severance pay at any time.
Because this regulation revokes on December 17, 2021 as per s. 5 of the regulation, an employee will be able to renounce the recall rights as of December 17, 2021. An employer and trade union cannot agree to restrict the ability to renounce recall rights beyond that date. See the discussion of s. 5 below.
Paragraph 3 of ss. 4(4) provides that the trade union cannot renounce an employee’s right of recall on behalf of that employee. The regulation only authorizes the trade union to retain an employee’s right of recall on the employee’s behalf.
Note that although there is no requirement in the regulation corresponding to the requirement in ss. 67(7) of the ESA 2000 that the employer pay the termination pay and severance pay to which the employee is entitled into trust where either the employee or the union on behalf of an employee elects to retain recall rights under this regulation, the trade union and employer are not prohibited by the regulation from bargaining a trust arrangement with respect to any or all of the pay to which the employee is entitled. Unlike s. 67(7), the regulation does not contemplate that any such trust arrangement would involve paying the money into trust with the Director of Employment Standards. Therefore, the Director will not accept any money into trust where the regulation applies.
Subsection 4(5) provides that where the union did not elect to retain recall rights on an employee’s behalf and the employee elects to be paid termination pay that became due because of a lay-off of 35 weeks in a period of 52 consecutive weeks, or severance pay, the employee will be deemed to have abandoned his or her right to be recalled.
Note, however, that this provision does not apply if the employee and employer have agreed to (as opposed to the Director approving) the payment of severance pay by instalment under s. 66 of the Act. In that event, ss. 67(2) provides that the provisions of s. 67 (including ss. 4(5) of this regulation) do not apply with respect to the severance pay entitlement.
Subsection (6) provides that where the employee accepts a recall to work, the employee is deemed to have abandoned the right to termination pay and severance pay.
Subsection (6) deals only with the issue of what happens to the entitlement to termination and severance pay when an employee accepts a recall; neither it, nor any other provision in s. 67 or Reg. 764/20, has any bearing on what constitutes a termination within the meaning of s. 56 or what constitutes a severance within the meaning of s. 63. See the Court of Appeal decision in United Steel v National Steel Car Limited, 2013 ONCA 401 (CanLII), where the Court rejected the employer's argument that s. 67 means that an employee who accepts a recall cannot have any of the time spent on lay-off prior to the recall taken into account in determining whether there was a subsequent termination or severance. See ESA Part XV, s. 63(1) of the Manual for further discussion of this case.
Sometimes situations will arise in which the employer recalls an employee who had elected to retain recall rights – or on whose behalf the union had elected to retain recall rights - and the employee refuses to return to work. Because the employee's refusal occurs after the point at which the employee became entitled to termination pay or severance pay, the employee's refusal to accept the recall cannot disentitle him or her to that termination pay or severance pay. Specifically, none of the exemptions in ss. 2(1) or 9(1) of O. Reg 288/01 apply to exempt such an employee from termination or severance pay to which he or she is already entitled. While paragraph 7 of s. 2(1) of O. Reg 288/01 provides that an employee on a temporary lay-off is exempt from the termination provisions if he or she does not return to work when recalled, it does not apply to a refusal to return to work that occurs after the point at which the right to termination pay has crystallized. Further, there is no exemption from severance pay in O. Reg 288/01 that corresponds to paragraph 7 of s. 2(1) of that regulation.
Accordingly, an employee who has been recalled after his or her termination or severance entitlements have crystallized may refuse to return to work and then - subject to the restriction in paragraph 2 of ss. 4(4) of this regulation that prevents an employee on whose behalf the trade union elected to retain the right to be recalled from renouncing that right before the date agreed upon by the employer and trade union – the employee may renounce his or her recall rights, in which case he or she will be entitled to receive his or her termination or severance pay.
Alternatively, an employee could refuse the recall but retain the recall rights (if he or she did not lose them under the terms of the contract or collective agreement for having refused to return to work when recalled). If the employee's refusal resulted in the automatic termination of recall rights under the terms of the contract or collective agreement, then the result would be the same as if the recall rights had expired, i.e., the employer would have to pay the employee the termination and severance pay to which the employee is entitled.
Situations may also arise in which a long service employee who had been laid off for 35 weeks in a period of 52 consecutive weeks elects to retain recall rights - or the union elects to retain them on the employee’s behalf - and then, after more than 13 weeks elapse, accepts a recall, only to have the employer terminate the employee's employment two weeks later. How is the employee's length of service calculated for purposes of notice of termination in this case? Because of the "period of employment" rule in s. 8 of O Reg 288/01, only the last two weeks of employment would be considered in calculating the employee's period of employment. As a result, the employee would be entitled under the ESA to one week's notice or one week's termination pay. (Note: While the employee's period of employment is only two weeks, the employee was "continuously employed for three months or more" within the meaning of s. 54 and so meets the s. 54 threshold for being is entitled to notice or termination pay in accordance with s. 57(a).)
Subsection 4(7) provides that where the employee renounces the right to be recalled (subject to the restriction in paragraph 2 of ss. 4(4) that prevents an employee on whose behalf the trade union elected to retain the right to be recalled from renouncing that right before the date agreed upon by the employer and trade union), or the rights expire, the employer is required to pay the employee the termination pay and severance pay to which the employee is entitled immediately, and the employee is deemed to have abandoned the right to be recalled.
This regulation was in effect from December 17, 2020 until July 30, 2022. It was revoked on July 31, 2022. Information about O. Reg. 764/20 remains in this publication for reference purposes only.
Section 5 of O. Reg. 764/20 provides that Reg. 764/20 is revoked on the first anniversary of the day it is filed. As the regulation was filed on December 17, 2020, it will be automatically revoked on December 17, 2021.
As such, employees, unions and employers who had been operating under the terms of this regulation will be subject to the provisions in s. 67 of the ESA 2000 as of December 17, 2021.
This means, for example, that as of December 17, 2021, employees have the exclusive right to elect to retain their recall rights, employers are required to pay the termination pay and severance pay of employees who have retained their recall rights into trust in accordance with s. 67(7), and employees’ ability to renounce their recall rights and be paid termination and severance pay will no longer be restricted by any agreement that may have been entered into by the union and the employer under this regulation establishing a date before which those rights could not be renounced.
This regulation was in effect from December 17, 2020 until July 30, 2022. It was revoked on July 31, 2022. Information about O. Reg. 764/20 remains in this publication for reference purposes only.
This regulation was in effect from December 17, 2020 until July 30, 2022. It was revoked on July 31, 2022. Information about O. Reg. 764/20 remains in this publication for reference purposes only.
The Regulation was filed on December 17, 2020.
This section contains definitions for certain terms used in the Employment Protection for Foreign Nationals Act, 2009 (EPFNA).
Note that EPFNA was amended effective November 20, 2015 by the Stronger Workplaces for a Stronger Economy Act, 2014, S.O 2014, c. 10 to broaden the scope of the legislation. Prior to November 20, 2015, EPFNA's name was the Employment Protection for Foreign Nationals Act (Live-in Caregivers and Others), 2009, and it applied only to foreign nationals employed or attempting to find employment in Ontario as live-in caregivers. Effective November 20, 2015, the newly named EPFNA applies to all foreign nationals employed in Ontario or attempting to find employment in Ontario pursuant to an immigration or foreign temporary employee program.
Some of the defined terms in the EPFNA have the same meaning as in the Employment Standards Act, 2000.
For the purposes of EPFNA, the term "director" is defined in the same way as in ESA Part XX, s.79.
Similarly, the use of the term "Director of Employment Standards" in EPFNA has the same meaning as "Director" in the Employment Standards Act, 2000. See ESA Part I, s. 1 for more information.
"Employment standards officer" has the same meaning in both acts. An employment standards officer is someone appointed under Part III of the Public Service of Ontario Act, 2006, S.O. 2006, c. 35, Sched. A. For a discussion on the authority to appoint employment standards officers, please see ESA Part XXI, s. 86.
A "foreign national" is defined as an individual who is neither a Canadian citizen nor a permanent resident within the meaning of the federal Immigration and Refugee Protection Act, S.C. 2001, c. 27 ("IRPA"). IRPA defines a permanent resident as a person who has acquired permanent resident status and has not subsequently lost that status per s. 46 of IRPA. The issue of whether a person is a Canadian citizen or a permanent resident can be assessed by requesting and reviewing certain documentation.
EPFNA defines the term "prescribed" as meaning established by regulations under EPFNA.
The term "recruiter" means a person who meets the criteria of acting as a recruiter as described in s. 2 of EPFNA. See the discussion of s. 2 of EPFNA for more information.
Subsection 1(2) clarifies how certain provisions of the Employment Standards Act, 2000, which are incorporated into EPFNA by reference, are to be interpreted. The subsection provides that where EPFNA incorporates a reference to a provision of the Employment Standards Act, 2000, the provision must be incorporated with necessary modifications. Subsection 1(2) goes on to specify that those modifications include the following:
For more information on the Director of Employment Standard's ability to delegate under EPFNA, see Delegation of Powers for further information.
Section 2 establishes when a person is "acting as a recruiter" for the purposes of the Act. A person is acting as a recruiter for the purposes of the Employment Protection for Foreign Nationals Act (Live-in Caregivers and Others), 2009 (EPFNA) if he or she:
In terms of distinguishing the first two bullets above, the first relates to a person finding or attempting to find or assisting in finding or attempting to find an individual for a position, whereas the second bullet relates to a person finding or attempting to find or assisting in finding or attempting to find a position for an individual.
As set out in clause (d), a person is acting as a recruiter for the purposes of EPFNA if he or she refers another person to someone who finds, or attempts to find, either an individual for employment or employment for an individual. This may arise, for example, where a person refers a potential employer to a recruitment agency for assistance in finding a foreign national for employment as a live-in caregiver.
This provision was amended by the Stronger Workplaces for a Stronger Economy Act, 2014, S.O 2014, c. 10, effective November 20, 2015 to reflect the broadened scope of the Employment Protection for Foreign Nationals Act (Live-in Caregivers and Others), 2009 (EPFNA). EPFNA formerly applied only to foreign nationals employed or attempting to find employment as live-in caregivers. (Prior to its amendment, this section also provided for the application of the Act to foreign nationals in other prescribed employment but none was prescribed prior to the amendment of this section.)
This provision lists the persons to whom the EPFNA applies. It must be read in conjunction with ss. 3(2) and 3(3) which provide that the EPFNA does not apply to employers or recruiters if the Employment Standards Act, 2000 would not apply in respect of the employment of the foreign national. Note also that s. 3(4) provides that EPFNA applies to the Crown only in such circumstances as are prescribed, and that at the time of writing, no regulation to prescribe such application has been made.
Subsection 3(1) sets out the persons to whom the EPFNA applies (subject to ss. 3(2), (3) and (4)) as follows:
Subsection 3(1) is intended to capture employment that is or would be permitted to be performed by a foreign national in Ontario under an immigration or temporary foreign employee program. It therefore refers to foreign nationals who are employed pursuant to such programs or who are attempting to find employment pursuant to such programs.
Generally, foreign nationals employed in Ontario pursuant to an immigration or foreign temporary employee program will require a work permit to work in Ontario. As a result, a foreign national as defined in s. 1(1) of the EPFNA who has a work permit allowing him or her to work in Ontario would be covered under the EPFNA (subject to ss. 3(2), 3(3) and 3(4)).
Immigration programs are administered by the federal government and would generally refer to programs that enable foreign nationals to obtain permanent residency in Canada. Under these programs, a foreign national may be permitted to apply for a work permit while their Permanent Resident (PR) application is being finalized, which would enable them to obtain employment in Ontario. For example, this would include the Family Sponsorship Program.
It should be noted that there may be immigration programs that permit a foreign national to work in Ontario without a work permit. Whether or not such a foreign national is working pursuant to an "immigration program" would have to be determined on a case by case basis. Further, even where the work is performed pursuant to an immigration program, the application of EPFNA is subject (as noted above) to ss. 3(2), 3(3) and 3(4). Of particular note in these situations would be ss. 3(2) and 3(3), which limit the application of EPFNA to foreign nationals whose employment would be covered under the Employment Standards Act, 2000. See above and below sections for a discussion of those subsections.
Foreign temporary employee programs refer generally to programs administered by the federal government intended to enable foreign nationals to obtain work permits so that they may legally perform work in Ontario on a temporary basis. A work permit will therefore be determinative evidence that a foreign national is employed pursuant to such a program. Some of the foreign temporary employee programs administered by the federal government at the time of writing are described below:
The Program's position is that a foreign national as defined in s. 1(1) of EPFNA will be considered to be attempting to find employment pursuant to an immigration or foreign temporary employee program if the individual possesses a work permit, has made an application for a work permit or there is evidence to demonstrate that the foreign national has communicated with a recruiter about finding employment in Ontario.
In order for the EPFNA to apply to an “employer”, that employer must ultimately employ a foreign national pursuant to an immigration or temporary foreign national employee program (or person acting on their behalf).
In other words, the obligations of an employer under the EPFNA apply only with respect to foreign nationals that are actually employed by the employer. For example, the prohibitions against cost recovery in s. 8 apply only to prohibit an employer from recovering costs incurred in employing or attempting to employ a foreign national who is (or was) in fact employed by the employer.
In order for the EPFNA to apply to a “recruiter”, that recruiter must be acting as such in connection with the employment of a foreign national in Ontario pursuant to an immigration or foreign temporary employee program.
One question that has arisen related to the application of the EPFNA to “recruiters” is whether a foreign government that participates in arranging for its own citizens to work in Ontario as foreign nationals could be considered a “recruiter” and therefore subject to the EPFNA as such. While a foreign government could, depending on the circumstances, be considered a “recruiter” as described in the EPFNA, the EPFNA (as provincial legislation) cannot generally be enforced against a foreign government because of the application of the federal State Immunity Act, R.S.C. 1985, c. S-18.
Subsection 3(2) specifies that EPFNA applies to every person who employs a foreign national in Ontario pursuant to an immigration or foreign temporary employee program if the Employment Standards Act, 2000 applies or would apply in respect of the employment of the foreign national. In determining whether the Employment Standards Act, 2000 applies or would apply in respect of employment, reference must be made to s. 3 of the Employment Standards Act, 2000, which sets out to whom the Act applies. Generally, the Employment Standards Act, 2000 applies with respect to an employee and his or her employer if the employee's work is performed in Ontario or if work outside of Ontario is a continuation of the work performed in Ontario, and the employer's undertaking falls within provincial employment law jurisdiction and the employer does not enjoy diplomatic immunity. See ESA Part III, s. 3 for more information on the application of the Employment Standards Act, 2000.
Subsection 3(3) specifies that EPFNA applies to every person who acts as a recruiter in connection with the employment of a foreign national in Ontario pursuant to an immigration or foreign temporary employee program if the Employment Standards Act, 2000 would apply in respect of the employment of the foreign national. In determining whether the Employment Standards Act, 2000 applies or would apply in respect of employment, reference must again be made to s. 3 of the Employment Standards Act, 2000 which sets out to whom the Act applies. Generally, the Employment Standards Act, 2000 applies with respect to an employee and his or her employer if the employee's work is performed in Ontario or if work outside of Ontario is a continuation of the work performed in Ontario, and the employer's undertaking falls within provincial employment law jurisdiction and the employer does not enjoy diplomatic immunity. See ESA Part III, s. 3 for more information on the application of the Employment Standards Act, 2000.
Subsection 3(4) establishes that EPFNA applies to the Crown in such circumstances as may be prescribed by regulation. However, at the time of writing, no regulations have been made pursuant to this provision; therefore, unless a regulation is made, EPFNA does not apply to employment with the Crown. For information on the meaning of the Crown, see ESA Part III, s. 3(4).
On January 1, 2018, the Fair Workplaces, Better Jobs Act, 2017, S.O. 2017 c. 22 amended s. 4 of the Employment Protection for Foreign Nationals Act, 2009 (EPFNA) to remove the requirement that the intent or effect of the arrangement as previously described in s. 4(1) must be to defeat, either directly or indirectly, the purpose of the EPFNA. This provision is analogous to ESA Part III, s. 4 which the Fair Workplaces, Better Jobs Act, 2017 similarly amended. Some small differences in wording are as follows:
Because of the substantial similarity between EPFNA s. 4 and ESA Part III, s. 4, the Program’s policies with respect to the interpretation of ESA Part III, s. 4 may be applied to this provision with necessary modifications.
Subsection 5(1) prohibits contracting out of or waiving of any requirement or prohibition in the Employment Protection for Foreign Nationals Act, 2009 (EPFNA) that is for the benefit of a foreign national. Any such contracting out or waiver would be void. This provision must be read in conjunction with s. 5(2), which defines the term "protective measure".
For a discussion of the similarly-worded "no contracting out" provision in the Employment Standards Act, 2000, see ESA Part III, s. 5 of this Manual; that discussion applies to the interpretation of this provision with necessary modifications.
This provision defines the term "protective measure" to mean a requirement or prohibition under EPFNA that applies to an employer, recruiter or person acting on behalf of an employer or recruiter, for the benefit of a foreign national.
The protective measures are found in ss. 7 to 13 of EPFNA.
The provisions in s. 6 of the Employment Protection for Foreign Nationals Act, 2009 (EPFNA) are analogous to those contained in s. 8 of the Employment Standards Act, 2000. Subsection 6(1) provides that subject to s. 21, EPFNA does not affect any civil remedy available to a foreign national against his or her employer or against a recruiter. Subsection 6(2) establishes the requirement that notice of a civil proceeding against an employer or recruiter under EPFNA be served on the Director of Employment Standards on an approved form before the proceeding is set down for trial. Subsection 6(3) incorporates provisions of the Employment Standards Act, 2000 which set out how the notice of civil proceeding must be served and when the service is effective.
The Program's policy with respect to the interpretation of s. 8 of the Employment Standards Act, 2000 applies to s. 6 of EPFNA with necessary modifications. See ESA Part III, s. 8 for more information.
Subsection 7(1) prohibits a recruiter from directly or indirectly charging any fee to a foreign national employed or attempting to find employment pursuant to an immigration or foreign temporary employee program for any service, good or benefit provided to the foreign national. This prohibition therefore includes fees charged by a recruiter for both "optional" and "mandatory" services such as orientation sessions, assistance or instruction with respect to resume or job interview preparation, image consulting, first aid training sessions, and cooking classes. Where such services are provided by a recruiter to a foreign national, they must be provided free of charge.
The Act does not restrict recruiters from charging fees to employers or prospective employers for recruitment services or for other services. Note, however, where such arrangements are made, the fees must be recorded in compliance with the record-keeping requirements as set out in ss. 14 and 15 of the Employment Protection for Foreign Nationals Act, 2009 (EPFNA).
As noted, s. 7(1) prohibits recruiters from “directly” charging any fee as well as “indirectly” charging any fee to a foreign national. An example of a situation where a recruiter “indirectly” charges a fee would include a situation where the recruiter charges a fee for services related to obtaining a work permit for the foreign national but asks the employer of the foreign national to collect those fees on its behalf through payroll deductions. Not only would the recruiter in this situation be in contravention of s. 7(1) but the employer making the deductions on behalf of the recruiter would be in contravention of s. 7(3).
Finally, as noted in the discussion of the scope of the EPFNA and specifically, s. 3(1) of the Act, a foreign government acting as a “recruiter” as described in the EPFNA is (unless certain exceptions under the State Immunity Act apply) immune from liability for any contraventions of the EPFNA including the prohibition against charging fees. As a result, a foreign government charging fees to its citizens who, as foreign nationals are seeking employment in Ontario pursuant to an immigration or temporary foreign employee program, would not be liable for a contravention of s. 7(1). In addition, a person acting on behalf of such a foreign government is likewise immune. (See the discussions at section 3(1) of the EPFNA and subsection 7(3) below.)
Subsection 7(2) provides that a recruiter would be permitted to charge a fee if it was permitted by regulation.
At the time of writing, no fees have been prescribed. Recruiters are therefore prohibited from charging fees of any kind to any foreign nationals employed or seeking employment pursuant to an immigration or foreign temporary employee program.
Subsection 7(3) prohibits a person acting on behalf of a recruiter from collecting a fee illegally charged by the recruiter. Whether a person is acting on behalf of a recruiter is a question of fact.
At the time of writing, recruiters are prohibited from charging fees of any kind to foreign nationals employed or attempting to find employment pursuant to an immigration or foreign temporary employee program. Therefore, persons acting on behalf of a recruiter are prohibited from collecting any fee on behalf of the recruiter.
An example of someone acting on behalf of a recruiter would arise where a recruiter charges a fee for services related to obtaining a work permit for a foreign national but asks the employer of the foreign national to collect those fees on its behalf through payroll deductions. In that case, the employer making the deductions on behalf of the recruiter would be in contravention of s. 7(3). (Note as well the recruiter in this situation would be in contravention of s. 7(1).
Finally, as noted in the discussion of the scope of the EPFNA and specifically, s. 3(1) of the Act, a foreign government acting as a “recruiter” as described in the EPFNA is (unless certain exceptions under the State Immunity Act apply) immune from liability for any contraventions of the EPFNA including the prohibition against charging fees. Further, a person acting on behalf of such a foreign government is similarly immune from liability under s. 7(3). (See the discussions at section 3(1) of the EPFNA and subsection 7(1) above.)
This provision prohibits employers from recovering or attempting to recover (either directly or indirectly), any costs incurred in hiring, or attempting to hire, a foreign national pursuant to an immigration or foreign temporary employee program. Employers are therefore prohibited from passing on to the foreign national any recruitment costs and other costs incurred in arranging to become or attempting to become the foreign national’s employer; employers would also be prohibited from recovering any prescribed costs (though no other costs have been prescribed as of the time of writing). The provision must be read subject to s. 8(2) which permits costs prescribed by regulation to be recovered. Ontario Regulation 348/15, which came into force on November 26, 2015, provides certain exceptions to the prohibition against cost recovery by employers.
Recovering or attempting to recover a cost indirectly could include, for example, ostensibly charging the foreign national a fee for something that was not a cost incurred in the course of arranging to become the employer but which in fact was intended to reimburse the employer for such a cost under another name. It could also include having another person recover the cost on behalf of an employer.
It should be noted that although the provision states that it prohibits recovery of costs incurred in "attempting to become an employer," the prohibition does not apply with respect to costs incurred by a prospective employer unless the employer ultimately employs the foreign national. That is because the scope of the Employment Protection for Foreign Nationals Act, 2009 is limited in its application under paragraph 2 of s. 3(1) to "a person who employs a foreign national".
Subsection 8(2) provides that the prohibition against cost recovery by employers would does not apply with respect to costs that are permitted by regulation. Ontario Regulation 348/15, which came into force on November 26, 2015, provides that employers who employ a foreign national in Ontario under an employment contract made pursuant to the federal government’s “Seasonal Agricultural Worker Program” (SAWP) are permitted to recover from the foreign national costs of air travel and of work permits, if the contract allows for these deductions. Please note that any such cost recovery is limited to the amounts as specified within the contract.
Subsection 9(1) provides that an employer of a foreign national employed pursuant to an immigration or foreign temporary employee program, or anyone acting on the employer's behalf, is prohibited from taking or keeping property that the foreign national is entitled to possess. The prohibition in s. 9(1) applies even if the property is taken or retained with the consent of the employee. Subsection 9(3) gives two examples of property that cannot be taken or kept: a passport and a work permit.
Subsection 9(2) establishes the same prohibition against taking and retaining property for a recruiter or person acting on the recruiter's behalf.
Subsection 9(2) provides that a recruiter, or anyone acting on the recruiter's behalf in connection with the employment of a foreign national pursuant to an immigration or foreign temporary employee program, is prohibited from taking or keeping property that the foreign national is entitled to possess. This prohibition applies even if the property is taken or retained with the consent of the employee. Subsection 9(3) gives two examples of property that cannot be taken or kept: a passport and a work permit.
Subsection 9(1) establishes the same prohibition against taking and retaining property for an employer or person acting on the employer's behalf.
Subsection 9(3) provides two examples of property that employers, recruiters, and persons acting on their behalf are prohibited from taking or keeping from a foreign national who is employed or attempting to find employment pursuant to an immigration or foreign temporary employee program. The examples provided are a passport and work permit. It is important to note that this provision does not purport to limit the property described in ss. (1) and (2) to these two documents. Employers, recruiters, and those acting on their behalf are prohibited from taking or keeping any property the foreign national is entitled to possess.
While a passport may be the property of the issuing country, the person to whom the passport is issued is generally entitled to possess the document.
Subsection 10(1) prohibits employers and anyone acting on their behalf from reprising against foreign nationals employed pursuant to an immigration or foreign temporary employee program for asking a person to comply with the Employment Protection for Foreign Nationals Act, 2009 (EPFNA), for making inquiries about, exercising or seeking the enforcement of their rights under EPFNA, for giving information to an employment standards officer or for participating in a proceeding under EPFNA. This includes intimidating, penalizing or attempting or threatening to intimidate or penalize the employee for doing any of the activities listed in clauses (a) to (f) above.
Subsection 10(1) is very similar to s. 74 of the Employment Standards Act, 2000, except that it contains no clauses corresponding to those Employment Standards Act, 2000 clauses that are not relevant to EPFNA (i.e., the clauses dealing with proceedings under the Retail Business Holidays Act, R.S.O. 1990, c. R.30, leaves of absence and garnishment orders).
It is important to note that foreign nationals who are employed pursuant to an immigration or foreign temporary employee program have protection from reprisals related to the Employment Standards Act, 2000 (including the provisions related to the Retail Business Holidays Act, etc.) through s. 74 of the Employment Standards Act, 2000 because they are "employees" under the Employment Standards Act, 2000.
In the Employment Standards Act, 2000 context, the Program applies a four-step test for determining whether an employer or a person acting on behalf of the employer has committed an act of reprisal. The test has been modified to fit the context of EPFNA as set out below:
If all five questions are answered in the affirmative, a breach of s. 10(1) is established. (Note that s. 10(3) places the burden of proof on the employer in a proceeding involving an alleged reprisal, except where the burden of proof relates to a review of a notice of contravention at the Ontario Labour Relations Board or a prosecution in court).
Information on Employment Standards Act, 2000 reprisal can be found in ESA Part XVIII of this Manual. In particular, four of the five steps outlined here are discussed in further detail. The discussion of reprisals under the Employment Standards Act, 2000, including the discussion of enforcement and heads of damage, can be applied to this provision with necessary modifications.
Subsection 10(2) establishes an anti-reprisal scheme respecting recruiters and those acting on their behalf. It prohibits recruiters and anyone acting on their behalf from reprising against foreign nationals employed or seeking employment pursuant to an immigration or foreign temporary employee program for asking a person to comply with EPFNA or the Employment Standards Act, 2000, for making inquiries about, exercising or seeking the enforcement of their rights under EPFNA or the Employment Standards Act, 2000, for giving information to an employment standards officer or for participating in a proceeding under EPFNA or the Employment Standards Act, 2000. This includes intimidating, penalizing or attempting or threatening to intimidate or penalize the foreign national for doing any of the listed activities in clauses (a) to (f) above.
Note that in addition to prohibiting reprisals related to EPFNA, this subsection specifically prohibits recruiters and persons acting on their behalf from reprising against foreign nationals for reasons related to inquiries about, exercising or enforcing their rights under the Employment Standards Act, 2000. This latter prohibition is necessary because section 74 of the Employment Standards Act, 2000 (which prohibits reprisals related to the Employment Standards Act, 2000) would not otherwise apply to recruiters or persons acting on their behalf, because they are not "employers".
In the Employment Standards Act, 2000 context, the Program applies a four-step test for determining whether an employer, or a person acting on behalf of the employer, has committed an act of reprisal. The test has been modified to fit the context of EPFNA in relation to recruiters or persons acting on behalf of recruiters as set out below:
If all five questions are answered in the affirmative, a breach of s. 10(2) is established.
Information on Employment Standards Act, 2000 reprisal can be found in ESA Part XVIII of this Manual. In particular, four of the five steps outlined here are discussed in further detail. The discussion of reprisals under the Employment Standards Act, 2000, including the discussion of enforcement and heads of damage, can be applied to this provision with necessary modifications.
This provision places the legal burden of proof that a person did not contravene s. 10 on that person, except in proceedings referred to in s. 4 (which are Ontario Labour Relations Board reviews of notices of contravention and prosecutions). Subject to s. 10(4), the effect of this provision is to require the employer, recruiter, or person acting on behalf of the employer or recruiter, to rebut the claim of the foreign national that he or she has been the subject of a reprisal. The person (which includes a corporation) against whom the contravention is alleged must establish, on a balance of probabilities, that he, she, or it did not contravene s. 10 of EPFNA.
Subsection 10(4) provides that a person who is alleged to have contravened the anti-reprisal provisions does not have the burden of proof to establish that he or she did not contravene s. 10 in two situations:
Where a person is prosecuted for contravening s. 10, the onus of proof that applies is set out in s. 43 of EPFNA.
This section was amended by the Stronger Workplaces for a Stronger Economy Act, 2014, S.O 2014, c. 10, to reflect the Employment Protection for Foreign Nationals Act (EPFNA)'s broader scope, effective November 20, 2015.
Subsection 11(1) provides that an employer who does not use the services of a recruiter in hiring a foreign national pursuant to an immigration or foreign temporary employee program is required to give certain information documents published by the Director of Employment Standards under s. 12 to the foreign national before his or her employment starts.
The documents published by the Director describe the rights and obligations of foreign nationals under EPFNA, the obligations of their employers and recruiters under EPFNA, and certain rights and obligations of foreign nationals and their employers under the Employment Standards Act, 2000.
Subsection 11(2) provides that if a recruiter contacts, or is contacted by, a foreign national regarding employment pursuant to an immigration or foreign temporary employee program, the recruiter is required to give certain information documents published by the Director of Employment Standards under s. 12 to the foreign national. The documents must be provided as soon as is practicable after the recruiter first makes contact with the foreign national. What is "as soon as is practicable" will depend upon the circumstances.
The documents published by the Director describe the rights and obligations of foreign nationals under EPFNA, the obligations of their employers and recruiters under EPFNA, and certain rights and obligations of foreign nationals and their employers under the Employment Standards Act, 2000.
This provision states that where the language of a foreign national is a language other than English, the employer or recruiter is required to enquire as to whether the Director of Employment Standards has prepared a translation of the documents published under s. 12 into that language. If the documents have been translated into that language, the employer or recruiter is required to provide a copy of the translation together with the English version to the foreign national.
This provision is a transitional provision that requires an employer to provide certain information documents to all foreign nationals who are covered under the "new" EPFNA effective on November 20, 2015 and who are employed by the employer on that date.
This provision requires the employer to give such employees a copy of the documents published under s. 12 as soon as is practicable after that date. What is "as soon as is practicable" will depend upon the circumstances.
In accordance with s. 11(3), if the foreign national's language is a language other than English, the employer would be required to provide the foreign national with a translated copy, if a translation is available, as well as the English version of the documents published under s. 12.
This amended subsection provides that if the Director has published different information documents for different categories of foreign nationals under s. 12(3), such foreign nationals are entitled to be provided with the appropriate information documents in accordance with s. 11.
Subsection 12(1) provides that the Director of Employment Standards must prepare and publish a document that provides information about the rights under the Employment Protection for Foreign Nationals Act, 2009 of foreign nationals and the responsibilities of employers and recruiters of such foreign nationals.
Subsection 12(2) provides that the Director of Employment Standards must prepare and publish a document that outlines the rights and responsibilities of employees and employers under the Employment Standards Act, 2000 that are particularly relevant to foreign nationals employed pursuant to an immigration or foreign temporary employee program and the employers of such foreign nationals.
This provision was added to s. 12 by the Stronger Workplaces for a Stronger Economy Act, 2014, S.O 2014, c. 10, effective November 20, 2015. It enables the Director of Employment Standards to prepare and publish different documents for different categories of foreign nationals and their employers.
This subsection provides that if the Director believes that the document published under this section regarding rights and obligations is out of date, he or she will prepare and publish a new document.
Where a person has been convicted of an offence under the Employment Protection for Foreign Nationals Act, 2009, this section authorizes the Director to publish or otherwise make available to the public including publication on the internet the name of the convicted person, a description of the offence, the date of the conviction, and the sentence received by the person.
Subsection (3) deems any disclosure made under subsection (1) to be in compliance with s. 42(e) of the Freedom of Information and Protection of Privacy Act, R.S.O. 1990, c. F.31. That provision reads as follows:
An employer of a foreign national who is employed pursuant to an immigration or foreign temporary employee program is required to record the following information:
This provision should be read with in conjunction with s. 14(2) which establishes how long the records must be kept and s. 14(3) which requires that all records be readily available for inspection by an employment standards officer.
At the time of writing, regulations have not been made under the Employment Protection for Foreign Nationals Act (EPFNA) prescribing other employment or additional information that must be recorded.
Subsection 14(2) requires an employer to retain, or arrange for another person to retain, the required records for a period of seven years after the earlier of the following two events:
The federal Immigration and Refugee Protection Act, S.C. 2001, c. 27 and its regulations govern the process by which a person may be granted permanent resident status or Canadian citizenship.
It is the responsibility of the employer to record and retain information for record-keeping purposes. Where an employer makes an arrangement for another person, such as a bookkeeper or accountant, to retain the records, the employer’s responsibility to create the records is not removed.
This provision should be read in conjunction with s. 14(3) which requires that records be readily available for inspection by an employment standards officer, even where another person retains the records.
Subsection 14(3) is intended to prevent unnecessary delays in the production of an employer’s records during an investigation under EPFNA. The provision therefore requires the employer to ensure the records made under s. 14(1) are "readily available for inspection", even if the employer has arranged for another person to retain the records.
Where an employer has arranged for another person to retain the records, it remains the employer’s responsibility to make them readily available, upon the request of an employment standards officer.
A recruiter of a foreign national for employment pursuant to an immigration or foreign temporary employee program is required to record the following information:
This provision should be read in conjunction with s. 15(2) which establishes a duty to keep certain documents associated with charging an allowable prescribed fee, s. 15(3) which establishes how long the records must be kept, and s. 15(4) which requires that all records be readily available for inspection by an employment standards officer.
At the time of writing, regulations have not been made under the Employment Protection for Foreign Nationals Act (EPFNA) prescribing allowable fees, or additional information that must be recorded.
If a regulation was to be made allowing a fee under s. 7(2), s. 15(2) would require a recruiter who charged such a fee to retain any documents related to the fee, such as invoices and statements of account.
This provision would only be relevant if an allowable fee was prescribed. At the time of writing, no such regulation exists. At the time of writing, EPFNA prohibits recruiters from charging any fees to foreign nationals to whom EPFNA applies.
Subsection 15(3) requires a recruiter to retain, or arrange for another person to retain, the required records and documents for a period of seven years after the recruitment services have been provided.
It is the responsibility of the recruiter to ensure the information in s. 15(1) is recorded and that this information and any documents described in s. 15(2) are retained, whether or not the recruiter makes arrangements for another person, such as a bookkeeper or accountant, to retain the records or documents.
This provision should be read in conjunction with s. 15(3) which requires that records and documents be readily available for inspection by an employment standards officer, even if another person retains them.
Subsection 15(4) is intended to prevent unnecessary delays in the production of a recruiter’s records during an investigation under EPFNA. The provision therefore requires the recruiter to ensure the records and documents required to be kept under ss. 15(1) and 15(2) respectively are "readily available for inspection", even if the recruiter has arranged another person to retain the records and documents.
Where a recruiter has arranged for another person to retain the records or documents, it remains the recruiter’s responsibility to make them readily available, upon the request of an employment standards officer.
This provision is substantially the same as s. 131(1) of the Employment Standards Act, 2000. It prohibits a person from making, keeping or producing false records or other documents required to be kept under the Employment Protection for Foreign Nationals Act, 2009; it also prohibits a person from "going along with" making, keeping or producing such documents.
The Program’s interpretation of s. 131(1) of the Employment Standards Act, 2000 can be applied to this provision with the necessary modifications. See ESA Part XXV, s. 131 for more information.
Subsection 17(1) provides that ss. 18, 18.1 and 19 of the Employment Protection for Foreign Nationals Act, 2009 (EPFNA) (director liability and indemnification of directors) do not apply with respect to persons described in ss. 80(2), (3), or (4) of the Employment Standards Act, 2000. This exempts the following people from the application of ss. 18, 18.1 and 19:
For a discussion of ss. 80(2), (3) and (4) of the ESA 2000 please see ESA Part XX.
Subsection 17(2) indicates that shareholders who are parties to a unanimous shareholder agreement may be considered directors for the purposes of ss. 18, 18.1 and 19 of EPFNA to the extent that they have control over the affairs of the corporation relating to obligations under EPFNA. The shareholders are considered to have the discretion or power to manage or supervise the management of the business and affairs of the corporation where the unanimous shareholder agreement restricts the directors’ powers to supervise or manage the same activities.
This provision is similar to s. 81(1) of the Employment Standards Act, 2000, the major difference being that it applies in respect of illegally recovered costs rather than wages. The Program’s interpretation of s. 81(1) of the Employment Standards Act, 2000 can be applied to this provision with necessary modifications. See ESA Part XX, s. 81.
This provision is also similar to s. 81(1) of the Employment Standards Act, 2000, the major differences being that it applies to the directors of a recruiter or the directors of a corporation acting on behalf of the recruiter rather than the directors of an employer and that it applies in respect of illegally charged fees rather than wages. The Program’s interpretation of s. 81(1) of the Employment Standards Act, 2000 can be applied to this provision with necessary modifications. See ESA Part XX, s. 81.
This provision is similar to s. 81(2) of the Employment Standards Act, 2000, the major differences being that it applies to directors of recruiters or corporations acting on behalf of recruiters, as well as employers, and that it applies in respect of illegally charged fees or illegally recovered costs. The Program’s interpretation of s. 81(2) of the Employment Standards Act, 2000 can be applied to this provision with necessary modifications. See ESA Part XX, s. 81.
This provision is similar to s. 81(9) of the Employment Standards Act, 2000, the major difference being that it applies in respect of illegally charged fees and illegally recovered costs. The Program’s interpretation of s. 81(9) can be applied to this provision with necessary modifications. See ESA Part XX, s. 81.
This provision is substantially the same as s. 81(10) of the Employment Standards Act, 2000. The Program’s interpretation of s. 81(10) can be applied to this provision with the necessary modifications. See ESA Part XX, s. 81.
Subsection 18.1(1) provides that where a recruiter uses the services of another recruiter in connection with the recruitment or employment of a foreign national, and where that other recruiter charged fees to a foreign national in contravention of s. 7(1) of EPFNA:
This provision is similar to s. 81(2) of the ESA 2000, the major differences being the entities to whom it applies and that it applies in respect of illegally charged fees. The Program's interpretation of s. 81(2) of the ESA 2000 can be applied to this provision with necessary modifications. See ESA Part XX, s. 81.
This provision is similar to ss. 81(9) of the ESA 2000, the major difference being that it applies in respect of illegally charged fees. The Program's interpretation of ss. 81(9) can be applied to this provision with necessary modifications. See ESA Part XX, s. 81.
This provision is substantially the same as ss. 81(10) of the ESA 2000. The Program's interpretation of ss. 81(10) can be applied to this provision with the necessary modifications. See ESA Part XX, s. 81.
Subsection 18.1(5) creates the authority for an employment standards officer to issue an order to repay fees to recruiters and directors (if any) who have liabilities under s. 18.1.
It provides that ss. 24(2) (Order to repay fees) and ss. 24(7) (Orders against directors) apply with necessary modifications. See EPFNA, s. 24.
Section 19 provides that ss. 82 and 83 of the Employment Standards Act, 2000 apply with respect to director liability under the Employment Protection for Foreign Nationals Act, 2009.
Sections 82 and 83 of the Employment Standards Act, 2000 prohibit contractual and corporate governance provisions purporting to relieve directors from the duty to act in accordance with the Employment Standards Act, 2000 or purporting to relieve directors from liability for breach of the Employment Standards Act, 2000, allow (subject to certain restrictions and conditions) indemnification of directors, and provide that the Employment Standards Act, 2000 does not affect any civil remedies that a director may have against a person or vice versa. See ESA Part XX for a more detailed discussion of these provisions.
Subsection 20(1) provides that a person who wishes to file a complaint with the Ministry of Labour alleging a violation of the Employment Protection for Foreign Nationals Act, 2009 (EPFNA) must do so using a form approved by the Director of Employment Standards. This provision is substantially the same as s. 96(1) of the Employment Standards Act, 2000. For a discussion of the Program’s interpretation of s. 96(1) of the Employment Standards Act, 2000, which can be applied to this provision with necessary modifications, see ESA Part XXII, s. 96.
The EPFNA claim form may be filed online, is available for download and can be ordered through Publications Ontario.
This provision states that if the complaint is not filed in the approved form, then the complaint shall be deemed not to have been filed.
This provision is substantially the same as s. 96(2) of the Employment Standards Act, 2000. The Program’s interpretation of s. 96(2) of the Employment Standards Act, 2000 can be applied to this provision with the necessary modifications. See ESA Part XXII, s. 96.
Subsection 20(3) establishes a prohibition against a person filing a complaint with the Ministry under EPFNA where the employee has previously commenced a civil proceeding in court seeking a remedy for the same matter. (Section 21 establishes the converse prohibition, i.e., the barring of a person from commencing a civil action where the person has previously filed a complaint with the Ministry under EPFNA in respect of the same matter). This provision is similar to s. 98(1) of the Employment Standards Act, 2000. The Program’s interpretation of s. 98(1) of the Employment Standards Act, 2000 can be applied to this provision with necessary modifications. See ESA Part XXII, s. 98.
Subsection 20(4) imposes a three and a half year limitation period on filing a complaint under EPFNA.
Subsection 20(5) allows a regulation to be made that would change the general limitation period for filing a complaint, as set out in s. 20(4). It also allows for different limitation periods to be established by regulation for different classes of complaints. At the time of writing, no such regulation has been made.
Subsection 21(1) establishes that a person who files a complaint with the Ministry of Labour under the Employment Protection for Foreign Nationals Act, 2009 (EPFNA) is not allowed to commence a civil action in court seeking a remedy for the same matter (but see s. 21(2)). This prevents a person from seeking a remedy with both the Ministry and the courts in relation to the same matter.
This provision is similar to s. 97(1) of the Employment Standards Act, 2000. The Program’s interpretation of s. 97(1) can be applied to this provision with necessary modifications. See ESA Part XXII, s. 97.
Subsection 21(2) provides a two-week "cooling off" period in which the foreign national can withdraw the EPFNA complaint that he or she has filed with the Ministry, and thus preserve his or her right to commence a civil action in court. This two-week period could be used by the foreign national to consult a lawyer to determine whether the filing of the EPFNA complaint is advisable, given the potential impact on the complainant’s right to file a civil action.
This provision is similar to s. 97(4) of the Employment Standards Act, 2000. The Program’s interpretation of s. 97(4) can be applied to this provision with necessary modifications. See ESA Part XXII, s. 97.
This provision is similar to s. 102 of the Employment Standards Act, 2000.
Note that the language of s. 22(1) is permissive as far as the employment standards officer is concerned: the officer may require the persons listed in s. 22(2) to attend the meeting. The officer is not required by legislation to hold s. 22 meetings in preference to other methods of resolving claims or conducting an inspection.
That said, it is important to recognize that if a foreign national is employed as a live-in caregiver, the foreign national will both work and reside in a private residence. As per s. 34(2) of the Employment Protection for Foreign Nationals Act, 2009 (EPFNA), which incorporates s. 91(3) of the Employment Standards Act, 2000, certain rules apply to an employment standards officer seeking to enter premises used as a dwelling or living quarters. If the premises are used as a dwelling or living quarters, then the officer must have the consent of the person occupying the premises or must obtain a search warrant under s. 92 of the Employment Standards Act, 2000 before entering and inspecting.
For this and other reasons, an officer may find it preferable in such situations to conduct the investigation at a place other than the private residence. In that regard, s. 22(1) provides the authority to require attendance at a meeting, (which could be held at a government office) as long as written notice of the meeting is provided and the reason for the meeting is captured by one of the five listed circumstances:
The Statutory Powers Procedure Act, R.S.O. 1990, c. S.22 does not apply to meetings convened under s. 22(1), although the rules of natural justice generally do apply (as they generally do to any other aspect of the investigation process).
This provision describes the persons who may be required to attend a meeting held under s. 22(1).
This provision states that ss. 102(3) to (9) of the Employment Standards Act, 2000 apply with respect to s. 22 meetings. Those subsections deal with topics such as requirements for notice of the meeting, the requirement to bring or make available documents or other records for the meeting, and direction on the use of technology during a meeting. For a discussion of ss. 102(3) to (9) of the Employment Standards Act, 2000 see ESA Part XXII, s. 102.
Section 23 provides that s. 112 of the Employment Standards Act, 2000 applies if a foreign national and another person reach a settlement with regard to a contravention or alleged contravention of the s. 34(2) of the Employment Protection for Foreign Nationals Act, 2009, and they inform an employment standards officer of the terms of the settlement in writing.
Section 112 of the Employment Standards Act, 2000 provides that where an employee and an employer enter into a settlement, inform an employment standards officer of the settlement in writing and do what they agreed to do under the settlement, the settlement is binding but may be overturned by the Ontario Labour Relations Board where it can be established that fraud or coercion was involved.
Please see ESA Part XXII, s. 112 for a discussion of s. 112 of the Employment Standards Act, 2000.
Employment standards officers have the authority to make orders and other arrangements described in s. 24 when it is determined that there has been a contravention of the Employment Protection for Foreign Nationals Act, 2009 (EPFNA).
Subsection 24(2) establishes an employment standards officer's power to issue an order or make arrangements with a recruiter or other person to repay fees to a foreign national or prescribed person if they find that a recruiter or other person has contravened EPFNA s. 7, which prohibits the charging of fees. At the time of writing no persons were prescribed.
Specifically, an officer can:
Where an order is issued or an arrangement made to repay the amount of the fees directly to the foreign national, it must be done in accordance with ESA Part XXII, s. 103(1) to 103(3). Those subsections establish the circumstances in which an officer may arrange direct payment to the employee or issue an order to pay, set out the administrative costs that must be paid when an order is issued requiring payment to the Director in trust and provide that a single order may be issued where monies are owing to more than one employee.
ESA Part XXII, s. 103(5) to (10) and s. 105 apply with respect to an order or arrangement for the repayment of illegally charged fees. Those provisions address the contents of the order, service of the order, notice to the employee about the order, compliance requirements and the effect of the order and also provide that where an arrangement for repayment is made (i.e., where no order is issued) and the employee cannot be located, the employer must pay the amount owing to the Director of Employment Standards in trust.
Subsection 24(2) must be read in conjunction with EPFNA s. 1(2) which provides some guidance on what modifications must be read in where provisions of the Employment Standards Act, 2000 are incorporated into EPFNA by reference. In the context of a contravention of the prohibition against the charging of fees, a reference in the Employment Standards Act, 2000 to an order to pay wages under ESA Part XXII, s. 103 is to be read as a reference to an order to repay fees and a reference to an employer is to be read as a reference to a recruiter or person collecting fees on behalf of a recruiter.
Subsection 24(3) establishes an employment standards officer's power to issue an order or make arrangements to repay costs recovered by an employer where they find that the employer has contravened EPFNA s. 8, which prohibits employers’ recovery of certain costs.
Specifically, an officer can:
Where an order is issued or an arrangement made to pay the amount of the costs recovered by the employer directly to the foreign national, it must be done in accordance with ESA Part XXII, s. 103(1) to 103(3). Those subsections establish the circumstances in which an officer may arrange direct payment to the employee or issue an order to pay, set out the administrative costs that must be paid when an order is issued requiring payment to the Director in trust and provide that a single order may be issued where monies are owing to more than one employee.
ESA Part XXII, s. 103(5) to (10) and s. 105 apply with respect to an order or arrangement for the repayment of illegally recovered costs. Those provisions address the contents of the order, service of the order, notice to the employee about the order, compliance requirements and the effect of the order and also provide that where an arrangement for repayment is made (i.e., where no order is issued) and the employee cannot be located, the employer must pay the amount owing to the Director of Employment Standards in trust.
Subsection 24(3) must be read in conjunction with EPFNA s. 1(2) which provides some guidance on what modifications must be read in where provisions of the Employment Standards Act, 2000 are incorporated into the EPFNA by reference. In the context of a contravention of the prohibition against recovering certain costs, a reference in the Employment Standards Act, 2000 to an order to pay wages under ESA Part XXII, s. 103 is to be read as a reference to an order to repay illegally recovered costs.
Subsection 24(4) establishes an employment standards officer's power to issue an order for compensation if they find that any person has contravened the anti-reprisal provisions contained in EPFNA s. 10. The officer can order the foreign national to be compensated for any loss they incurred as a result of the contravention.
See ESA Part XVIII for a discussion of compensation orders in the context of the Employment Standards Act, 2000.
This provision also states that ESA Part XXII, s. 104(3) and (4) apply to compensation orders issued under EPFNA s. 24(4). Section 104(3)(a) provides that an order may be issued requiring a person to pay the amount of compensation to the Director in trust and such order will include administrative costs as set out in s. 104(3)(a)(ii). As a result, an order issued under s. 24(4) requiring the payment of compensation to the Director in trust will include administrative costs. However, no administrative costs are attached to an order issued under s. 104(3)(b) which requires the person to pay the amount of the compensation directly to the employee. As a result, there are no administrative costs included in an order issued under s. 24(4) if it requires the person to pay the amount of compensation directly to the foreign national.
Further, ESA Part XXII, s. 103(3) and (5) to (9) also apply to orders under EPFNA s. 24(4). Subsection 103(3) provides that a single order can be issued with respect to more than one employee. Subsections 103(5) to (9) address the contents of the order, service of the order, notice to the employee about the order, compliance requirements and the effect of an order.
Subsection 24(4) must be read in conjunction with EPFNA s. 1(2) which provides some guidance on what modifications must be read in where provisions of the Employment Standards Act, 2000 are incorporated into EPFNA by reference. In the context of a contravention of the anti-reprisal provision of EPFNA, a reference in the Employment Standards Act, 2000 to an order under ESA Part XXII, s. 104 is to be read as a reference to the corresponding order described in EPFNA ss. 24(4) or 24(5).
Subsection 24(5) establishes an employment standards officer's power to issue a reinstatement order if they find that an employer or person acting on behalf of an employer has contravened the anti-reprisal provisions contained in EPFNA s. 10. Where a reprisal under EPFNA has been found, the officer can issue an order requiring the foreign national to be reinstated into their position. The provision states that an officer may issue a reinstatement order in addition to an order for compensation. Thus, in addressing a contravention of the anti-reprisal provisions, an officer may issue an order for compensation, an order for reinstatement or both.
For a discussion of reinstatement orders in the context of the Employment Standards Act, 2000, including when an order for reinstatement is appropriate, see ESA Part XVIII.
This provision states that ESA Part XXII, s. 104(4) applies to a reinstatement order issued under EPFNA s. 24(5). As a result, ESA Part XXII, ss. 103(3) and (5) to (9) also apply with respect to orders under EPFNA s. 24(5). Subsection 103(3) provides that a single order can be issued with respect to more than one employee. Subsections 103(5) to (9) address the contents of the order, service of the order, notice to the employee about the order, compliance requirements, and the effect of an order.
Subsection 24(6) establishes an employment standards officer's power to issue a compliance order if they determine that a person has contravened a provision of EPFNA.
ESA Part XXII, s. 108 applies with respect to a compliance order under EPFNA. It empowers an employment standards officer to order that the person stop violating the legislation or take or stop taking action specified in the order by a date specified in the order. Section 108 provides that a compliance order cannot require the payment of wages or compensation. By referentially incorporating ESA Part XXII, s. 103(6) to (9), s. 108 also addresses service of the order, notice to the employee about the order, compliance requirements and the effect of the order. Further, s. 108 provides that other orders may be issued in addition to a compliance order and provides that the Director of Employment Standards may apply to court for an injunction to enforce the order.
Subsection 24(6) must be read in conjunction with EPFNA s. 1(2) which provides some guidance on what modifications must be read in where provisions of the Employment Standards Act, 2000 are incorporated into EPFNA by reference. In the context of a compliance order, a reference to an order under ESA Part XXII, s. 108 is to be read as a reference to the corresponding order described in in EPFNA s. 24(4) or s. 24(5).
ESA Part XXII, s. 106 and 107 apply with respect to the s. 24(7) order. ESA Part XXII, s. 106 provides for the issuance of orders against directors for wages owed by employers. Where an order to pay wages has been made against the employer, or where the employer is insolvent and a claim has been filed with a court-appointed receiver or trustee in bankruptcy, an employment standards officer can issue an order against some or all of the employer's directors for amounts for which directors are liable. ESA Part XXII, s. 107 provides for the issuance of orders against any directors who were not the subject of an order issued under s. 106 where the order against the employer and the directors who were subject of the s. 106 order remains unpaid and there has been no application for review.
Subsection 24(7) must be read in conjunction with EPFNA s. 1(2) which provides some guidance on what modifications must be made where provisions of the Employment Standards Act, 2000 are incorporated into EPFNA by reference. References in the Employment Standards Act, 2000 to an order under ESA Part XXII, s. 106 or s. 107 are to be read as a reference to the corresponding order described in s. 24(7).
Subsection 24(8) provides that ESA Part XXII, s. 109 applies where an order is issued requiring payment to the Director of Employment Standards in trust.
Section 109 requires the Director of Employment Standards to pay the money received in trust to the employee named in the order, unless the person against whom the order was issued has applied for a review of that order with the Ontario Labour Relations Board. If an order was issued with respect to more than one employee and less than the full amount has been paid, the amount that was paid (including the amount for administrative costs) is distributed proportionately among the employees. No proceeding may be launched against the Director for acting in accordance with s. 109.
This provision creates the authority to make a regulation that would set a maximum amount for an order to repay fees or an order to repay costs. It also provides that different maximum amounts could be established by regulation for different classes of contraventions or complaints. At the time of writing, no such regulations have been made.
This provision indicates that if a maximum amount for an order to repay fees or an order to repay costs is established by regulation, an employment standards officer would be prohibited from issuing an order for an amount greater than the prescribed maximum.
At the time of writing, no such regulation had been made and there is no maximum amount established for an order to repay fees or for an order to repay costs.
Subsection 25(1) provides that where a foreign national files a complaint, an employment standards officer is prohibited from issuing an order to repay fees or an order to repay costs if the contravention occurred more than three and a half years before the complaint was filed.
It is important to distinguish the limitation periods established under the Employment Protection for Foreign Nationals Act, 2009 from those under the Employment Standards Act, 2000. For example, where a complaint relates to unpaid wages under the Employment Standards Act, 2000, s. 111 of the Employment Standards Act, 2000 provides that an order cannot be issued for wages that came due to the complainant more than six months/one year or up to two years prior to the filing of the complaint. The different recovery periods under the Employment Standards Act, 2000 apply depending upon whether the unpaid wages came due prior to or on or after the date amendments made to s. 111 by the Stronger Workplaces for a Stronger Economy Act, 2014, S.O. 2014, c. 10 came into force (February 20, 2015).
This provision establishes a limitation period in respect of the recovery of illegally charged fees and illegally recovered costs through an order to pay where an employment standards officer who is investigating a complaint finds a contravention of the legislation in respect of a non-complainant while conducting the investigation.
It provides that where an officer is investigating a complaint filed by foreign national A, and during the course of that investigation finds a violation in respect of foreign nationals B and C, the officer may issue an order to repay fees or an order to repay costs in relation to foreign nationals B and C only if the contravention occurred in the three and half year period preceding the date foreign national A filed his or her complaint.
This provision is similar to s. 111(2) of the Employment Standards Act, 2000 as amended by the Stronger Workplaces for a Stronger Economy Act, 2014 although the limitation period in s. 111(2) is two years (with respect to wages that came due on or after February 20, 2015.). The Program's interpretation of s. 112(2) can be applied to this provision with the necessary modifications. See ESA Part XXII.
Subsection 25(3) provides that where during the course of an inspection (as opposed to the investigation of a complaint), an employment standards officer finds a contravention, he or she may issue an order to repay fees or an order to repay costs only for those contraventions that occurred in the three and a half year period preceding the date the inspection began.
This provision allows for the making of a regulation that would extend or shorten the limitation periods that apply to the recovery of illegally charged fees or illegally recovered costs through an order to pay as set out in ss. (1) to (3). It also provides that different time limits could be prescribed for different classes of complaints or contraventions.
At the time of writing, no such regulation has been made.
Subsection 26(1) imposes an obligation on an employment standards officer to notify a complainant of his or her decision not to issue an order to repay fees or costs, a compensation order, a reinstatement order, or a compliance order in respect of a complaint. The officer must notify the complainant in accordance with s. 110(1) of the Employment Standards Act, 2000 which requires that a letter advising of the refusal be served in accordance with s. 95 of the Employment Standards Act, 2000. (Note that the notification obligation does not apply in the case of non-complainants.)
For a discussion of ss. 95 and 110(1) of the Employment Standards Act, 2000, see ESA Part XXI and ESA Part XXII.
This provision provides that where no order is issued within two years after the complaint was filed, then the employment standards officer shall be deemed to have refused to issue an order on the day before the two-year limitation period expires. Therefore, if during the two years after the foreign national files a claim, the officer neither issues an order, nor refuses to issue an order, then the officer will be deemed to have refused to issue an order on the day before the two-year period expired.
This provision is meant to address the unfortunate and rare event that an employment standards officer has neither issued an order nor refused to do so during the two-year limitation period set out in s. 28 of the Act. By deeming the officer to have refused to issue an order, the provision triggers the right of the foreign national to apply for a review by the Ontario Labour Relations Board under s. 29(3). The foreign national would have 30 days from the day before the two-year period expires in which to apply for a review of the officer’s deemed refusal.
Section 27(1) permits an employment standards officer to issue a notice of contravention requiring payment of a specified penalty to a person that the officer believes has contravened the Employment Protection for Foreign Nationals Act, 2009 (EPFNA). This provision was amended by the Fair Workplaces, Better Jobs Act, 2017, S.O. 2017, c. 22, effective January 1, 2018. The applicable penalties for a notice of contravention issued under this section are set out in O. Reg. 47/10.
The officer's power to issue a notice of contravention is discretionary. However, once the officer decides to issue the notice of contravention, the officer must set out the penalty as prescribed in the regulation. See ESA Part XXII, s. 113(1.1) for a discussion of an officer’s discretion regarding notices of contravention.
Note that the officer may issue a notice of contravention to any person they believe has contravened the Act. Person is defined in ESA Part I, s. 1. The word "person" indicates that the notice may be issued against an individual or a corporation. However, s. 27(1) must be read subject to s. 27(2) which states that ESA Part XXII, s. 113(9) applies to the issuance of a notice of contravention. Section 113(9) provides that a notice of contravention may not be issued where the contravention is by a director or officer of a corporation.
O. Reg. 47/10 prescribes penalties for contraventions of the EPFNA as follows:
For a contravention of EPFNA s. 14 or s. 15 identified to have occurred prior to January 1, 2018:
For a contravention of any other provision of EPFNA, the penalties set out are multiplied by the number of foreign nationals affected. For contraventions occurring prior to November 28, 2015, this provision applies only if the affected employees are live-in caregivers, as prior to November 28, 2015 EPFNA only applied to live-in caregivers.
For a contravention of EPFNA s. 14 or s. 15 identified to have occurred on or after January 1, 2018:
For a contravention of any other provision of the Act identified to have occurred on or after January 1, 2018, the above listed penalties apply, but the penalty is multiplied by the number of employees affected.
This section states that if a range has been prescribed as the penalty, the employment standards officer shall determine the amount of the penalty from within that range in accordance with any prescribed criteria. At the time of writing, no range has been prescribed and in accordance with s. 27(1.1) officers are therefore required to apply the penalties currently prescribed in O. Reg. 47/10.
This section provides that ESA Part XXII, s. 113 (2), (3), (7) and (9) apply to a notice of contravention issued under EPFNA.
Subsections 113(2), (3), (7) and (9) provide that:
Subsection 27(3) provides that where a notice of contravention is issued against a person, the person is deemed to have contravened the provision in question if that person fails to make an application for a review of the notice of contravention within 30 days after the date of service of the notice, or, where on a review of the notice, the Ontario Labour Relations Board finds that the person contravened the provision. In the latter case, this would occur if the Ontario Labour Relations Board affirms the notice or amends it.
Subsection 27(4) creates an obligation to pay the penalty set out in the notice of contravention (either by the officer where there is no review or where there is a review as affirmed or amended by the Ontario Labour Relations Board) to the Minister of Finance if the contravention is deemed to have occurred under s. 27(3).
It also requires payment of any collector's fees and disbursements added to the amount of the penalty under ESA Part XXIV, s. 128(2). In other words, once the notice of contravention has been sent for collection, any authorized collector's fees and disbursements are deemed to have been added to the amount set out in the notice of contravention.
ESA Part XXII, s. 113(6.1) applies to this penalty and establishes the time period within which the payment of the penalty to the Minister of Finance must be made. In the event that the notice is not appealed, the payment is due 30 days after the notice was issued. In the event the notice is appealed, the payment is due 30 days after the Ontario Labour Relations Board has found that there was a contravention.
This section permits the Director of Employment Standards to publish the name of the person or business that a notice of contravention has been issued to, as well as a description of the contravention, the date of the contravention, and the penalty for the contravention.
Note that the publishing of this information is restricted to situations where a person is deemed to have contravened EPFNA in accordance with s. 27(3). Such contraventions only occur when the recipient fails to file for a review of the notice with the Ontario Labour Relations Board within the period set out in EPFNA s. 30, where the person has filed for a review and the Board finds that they did in fact contravene the provision set out in the notice. As a result, the publishing of this information cannot simply occur once the notice was issued, but only after the application for review has been upheld or the period for review has expired.
This subsection clarifies that the authority to publish the information set out in s. 27(5) includes authority to publish on the Internet.
This subsection states that where the Director has published information under s. 27(5) that such publication is deemed to be permitted under the Freedom of Information and Protection of Privacy Act, R.S.O. 1990, c. F.31
This provision establishes a two-year limitation period on the Ministry's ability to issue an order to repay fees, an order to repay costs, an order for compensation or a notice of contravention. The two-year period for issuing the above-listed orders commences with the following:
It should be noted that the legislation does not impose a limitation period with respect to an officer's ability to issue an order for reinstatement or an order for compliance. For more information on the Program's policy around the issuance of those orders, which can be applied in the context of the Employment Protection for Foreign Nationals Act, 2009 (EPFNA), see ESA Part XXII, s. 114.
Subsection 28(2) provides that ss. 114 (2) to (5) and s. 115 of the Employment Standards Act, 2000 apply to the limitation periods set out in s. 28(1) and to the amendment or recession of an order or notice of contravention.
Subsection 114(2) provides that where a complaint is filed by one employee and a second employee files a complaint about substantially the same contravention, the second employee is treated as a non-complainant for purposes of the limitation period on the issuance of orders, thus, in the context of EPFNA, attracting the application of s. 28(1)(b); s. 114(3) provides that this rule does not apply if an order had already been issued or notification of a refusal to issue an order had already been made in respect of the first complaint. Subsections 114(4) and (5) provide that orders and notices of contravention, respectively, cannot be amended or rescinded after the expiry of the limitation period applicable to the issuance of orders and notices without the consent of the employer and employee (in the case of orders) or the consent of the employer (in the case of notices of contravention). Subsection 115 addresses the meaning of "substantially the same" as that term is used in s. 114. See ESA Part XXII for a more detailed discussion of these provisions.
Subsection 29(1) provides that a person against whom an order has been issued is entitled to a review of the order by the Ontario Labour Relations Board if he or she meets the conditions set out in s. 116(1) of the Employment Standards Act, 2000. Subsection 116(1) of the Employment Standards Act, 2000 establishes that a person is entitled to a review if:
For a discussion of s. 116(1) of the Employment Standards Act, 2000, see ESA Part XXIII.
Subsection 29(1) should be read in conjunction with s. 29(5) which incorporates by reference, amongst other Employment Standards Act, 2000 provisions, ss. 116(4) and 116(5) of the Employment Standards Act, 2000. Section 116(4) sets out a 30-day time limit for applying for a review, and s. 116(5) allows the Ontario Labour Relations Board to extend the time allowed to apply for a review, if it considers it appropriate to do so.
This provision provides that a foreign national in respect of whom an order to repay fees, an order to repay costs, an order for compensation or an order for reinstatement has been issued is entitled to a review of the order by the Ontario Labour Relations Board if he or she fulfils the conditions under s. 116(2) of the Employment Standards Act, 2000.
Subsection 116(2) of the Employment Standards Act, 2000 establishes the right of an employee in respect of whom certain orders have been issued to a review of the order if the application for review is made in writing and is made within thirty days of service of the order. Therefore, a foreign national seeking a review of an order to repay fees, an order to repay costs, an order for compensation or an order for reinstatement must, within thirty days of the service of the order, apply to the Board for a review of the order in writing.
For a more detailed discussion of s. 116(2) of the Employment Standards Act, 2000 see ESA Part XXIII.
Note that foreign nationals have no entitlement to a review of an order issued against a director under s. 24(7) or to a review of a compliance order issued under s. 24(6).
Subsection 29(3) provides that a foreign national who has filed a complaint alleging a contravention of the Act can apply to the Ontario Labour Relations Board for a review the employment standards officer’s decision not to issue an order to repay fees, an order to repay costs, an order for compensation or an order for reinstatement if he or she meets the conditions set out in s. 116(3) of the Employment Standards Act, 2000.
Subsection 116(3) of the Employment Standards Act, 2000 provides employees who have filed a complaint alleging a contravention of the Employment Standards Act, 2000 with an entitlement to a review of an employment standards officer’s decision not to issue certain orders. The application for a review must be made in writing within thirty days after service of the letter advising the employee of the officer’s refusal to issue an order. The 30-day time period applies where an employment standards officer refuses to issue an order, as well as where there is a deemed refusal to issue an order under s. 110(2) (which corresponds to s. 29(2) of EPFNA). It is important to note that subsection 116(3) of the Employment Standards Act, 2000 only applies where the employee in question has filed a complaint. Subsection 29(3) thus makes these principles apply in the context of EPFNA, as well.
See ESA Part XXIII for the Program’s interpretation of s. 116(3).
This subsection provides that even though foreign nationals have the right to a review under subsections (2) and (3), there is no right to a review of an order issued against a director under s. 24(7), nor is there a right to a review of an employment standards officer’s refusal to issue an order against a director under s. 24(7). See the discussion at EPFNA s. 24(7).
Subsection 29(5) establishes that ss.116 (4) to (9), and ss. 117 and 118 of the Employment Standards Act, 2000 apply with respect to a review.
In very general terms, those provisions address the limitation periods for applications for review to the Ontario Labour Relations Board, allow the Board to extend the limitation period, require the Board to hold review hearings and establish certain requirements for hearings at the Board, specify the parties to the review, allow the Board to establish its own practice and procedure, provide that money held in trust pending a review must be held in an interest-bearing account and paid out with interest in accordance with a settlement or Board decision, and provide that the chair of the Board may make rules of practice and procedure.
For a discussion of these provisions, see ESA Part XXIII.
Subsection 29(6) provides that the Ontario Labour Relations Board has the powers set out in ss. 119 and 120 of the Employment Standards Act, 2000 on a review of an order or a refusal to issue an order under this Act. Section 119 deals with such matters as quorum, posting of notices and, most importantly, gives the Board the powers conferred on employment standards officers and authorizes the Board to substitute its findings for those of the officer whose decision is under review. Section 120 deals with such matters as interim orders, interest and judicial review of Board decisions.
For a detailed discussion of the powers of the Board, see ESA Part XXIII.
This provision establishes the right of a person against whom a notice of contravention has been issued to a review of the notice of contravention as provided for in s. 122(1) of the Employment Standards Act, 2000. Subsection 122(1) of the Employment Standards Act, 2000 provides that the written application for review must be made within thirty days of the service of the notice, unless the Ontario Labour Relations Board considers it appropriate to extend the time limit.
It is important to note that it is only the person against whom the notice has been issued, and not the foreign national to whom the contravention relates, who can apply for a review.
For a discussion of s. 122(1), see ESA Part XXIII.
Subsections 122(2) to (7) of the Employment Standards Act, 2000 apply to a request for review of a notice of contravention. In very general terms, those provisions relate to reviews of notices of contravention at the Ontario Labour Relations Board and to the powers of the Board on such reviews.
For a more detailed discussion of ss. 122(2) to (7), see ESA Part XXIII.
This provision provides that ss. 123 and 124 of the Employment Standards Act, 2000 apply to the Ontario Labour Relations Board and its duties under the Employment Protection for Foreign Nationals Act, 2009.
Section 123 of the Employment Standards Act, 2000 provides that a Board member, employee or registrar cannot be compelled to give evidence in a civil proceeding, Board proceeding or other administrative proceeding with respect to information obtained while exercising his or her powers or performing his or her duties under the Employment Standards Act, 2000 unless the Board consents. It also provides that a labour relations officer cannot disclose information or material received under the Employment Standards Act, 2000 without Board authorization.
Section 124 of the Employment Standards Act, 2000 provides that where the Board has not made a decision six months after a proceeding was commenced, a party can apply to terminate the proceeding. If the proceeding is terminated, the chair can reinstitute the proceeding on such terms as he or she considers appropriate.
For a discussion of ss. 123 and 124 of the Employment Standards Act, 2000 see ESA Part XXIII.
This provision allows a regulation to be made that prescribes how the Employment Protection for Foreign Nationals Act, 2009 may be enforced where an employer of a foreign national is bound by a collective agreement. At the time of writing no such regulation has been made.
This provision allows a regulation to be made that provides that a settlement made on behalf of an employee by a trade union representing the employee is binding. At the time of writing no such regulation has been made.
This subsection provides that the Director of Employment Standards may exercise the powers conferred upon him or her under the Employment Protection for Foreign Nationals Act, 2009 (EPFNA) and that he or she is required to perform the duties imposed on him or her under this Act.
This provision makes ss. 85(2) and (3) and ss. 88 and 88.1 of the Employment Standards Act, 2000 applicable to the Director of Employment Standards in relation to EPFNA.
Subsections 85(2) and (3) of the Employment Standards Act, 2000 allow the Director or the Deputy Minister, in the Director's absence, to name a Ministry of Labour employee as Acting Director, with the Director's powers and duties, if the Director is absent or unable to act or if the office is vacant.
Section 88 of the Employment Standards Act, 2000 provides for certain powers and duties of the Director of Employment Standards including the making of policies respecting the interpretation, administration and enforcement of the Employment Standards Act, 2000; the delegation of powers and duties to employment standards officers; the establishment of interest rates for purposes of the Employment Standards Act, 2000; and the disbursement of money held in trust in circumstances where no other provision of the Employment Standards Act, 2000 addresses such disbursement. For a more detailed discussion of s. 88 see ESA Part XXI.
Section 88.1 of the Employment Standards Act, 2000 allows the Director of Employment Standards to transfer the investigation of a complaint or inspection from one employment standards officer to another employment standards officer. For a more detailed discussion of s. 88.1, see ESA Part XXI.
Subsection 34(1) parallels s. 33(1), concerning, in this case, the powers and duties of employment standards officers. This section provides that employment standards officers may exercise the powers conferred upon them under theEmployment Protection for Foreign Nationals Act, 2009, S.O. 2009, c. 32 (EPFNA), and are required to perform the duties imposed on them under EPFNA.
This provision establishes that ss. 89 and 90 of the Employment Standards Act, 2000 apply to employment standards officers insofar as EPFNA is concerned.
Section 89 of the Employment Standards Act, 2000 requires employment standards officers to follow the policies established by the Director of Employment Standards respecting the interpretation, administration and enforcement of EPFNA and provides that an officer is not required to hold a hearing when exercising those powers or making a decision under EPFNA.
Section 90 of the Employment Standards Act, 2000 establishes that an employment standards officer is not a competent or compellable witness in a civil proceeding. An officer therefore cannot be made to testify in a civil action regarding any information obtained under EPFNA or to produce records or other documents made or received under EPFNA, except insofar as his or her duties under the EPFNA require such testimony or production. For example, if needed in a judicial review proceeding. For a more detailed discussion, see ESA Part XXI.
This subsection provides that a prosecution of an employment standards officer for a failure to follow the policies established by the Director, as required by s. 89(2) of the Employment Standards Act, 2000 (which is incorporated into EPFNA by reference through s. 34(2)), may only be commenced if the Deputy Attorney General provides his or her consent.
Subsection 34(4) states that a document that appears to be the consent of the Deputy Attorney General to prosecute an employment standards officer is admissible as evidence of his or her consent.
Subsection 35(1) provides that an employment standards officer may enter and inspect any place for the purposes of investigating a possible contravention or to perform an inspection to ensure the Employment Protection for Foreign Nationals Act, 2009 (EPFNA) is being complied with. Nothing in the provision limits the officer to a single visit in carrying out the investigation or inspection.
Note: there are limitations on this right of entry due to the incorporation of certain Employment Standards Act, 2000 provisions as set out in s. 35(2) below.
This provision provides that ss. 91(2) to (10) of the Employment Standards Act, 2000 which deal with investigation and inspection powers under the Employment Standards Act, 2000, apply with respect to investigations and inspections under EPFNA. Subsection 91(2) limits an officer’s right to enter and inspect in the case of any part of a place used as a dwelling to instances in which the occupier of the dwelling consents or a warrant has been issued. Other provisions of s. 91 that apply to EPFNA investigations and inspections require officers to produce evidence of their appointment on request; address the examination, demand and removal of records; and provide that a copy of a record certified by an officer as a true copy has the same evidentiary value as the original. For a more detailed discussion of these provisions, see ESA Part XXI.
Subsection 36(1) provides that a justice of the peace may issue a warrant authorizing an employment standards officer to enter a premises on the same grounds as are set out s. 92(1) of the Employment Standards Act, 2000. These grounds are:
For a discussion of an officer's right of entry and investigation and inspection powers under the Employment Standards Act, 2000, see ESA Part XXI.
This provision establishes that ss. 92(2) to (6) of the Employment Standards Act, 2000 apply to warrants. Those provisions deal with topics such as expiry of warrants, when warrants may be executed and access to police assistance in executing a warrant, and provide that ss. 91(4) to (13) of the Employment Standards Act, 2000 (which relate investigation and inspection powers) apply to an officer when executing a warrant. For a detailed discussion of ss. 92(2) to (6) see ESA Part XXI.
This provision mirrors s. 91(11) of the Employment Standards Act, 2000 and prohibits any person from hindering, obstructing or interfering with an investigation or inspection being conducted by an employment standards officer.
This provision mirrors s. 91(12) of the Employment Standards Act, 2000 and prohibits a person from refusing to answer an employment standards officer’s questions or from providing false or misleading information to the officer.
This provision is similar to s. 91(13) of the Employment Standards Act, 2000 and ensures that an officer may interview a person separately from any other persons on matters the officer thinks may be relevant to the investigation or inspection; this is intended to help to prevent "tailoring" of evidence or intimidation of persons, by the presence of others, who may have evidence. Clause 91(6)(e) of the Employment Standards Act, 2000 gives an employment standards officer the right to question any person on matters relevant to an investigation or inspection.
This provision is identical to s. 131(2) of the Employment Standards Act, 2000. It prohibits any person from providing false or misleading information under the Employment Protection for Foreign Nationals Act, 2009 (EPFNA). It has a general application in prohibiting any person, whether it is an employer or recruiter (including a corporation), a foreign national, a director or officer or agent, or any other person, from providing false or misleading information under EPFNA. It covers situations where the information is provided voluntarily, as well as pursuant to a demand or a summons, and regardless of whether the information is required to be kept by EPFNA or not.
This provision allows employment standards officers to require the posting of notices or copies of a report.
The notice referred to in clause (a) might, for example, consist of a general outline of all of the provisions of the Employment Protection for Foreign Nationals Act, 2009 or, on the other hand, may focus on one or more provisions that the officer feels are of particular relevance. The copy of the report or part of a report referred to in clause (b) may be a copy of the officer’s report (or excerpts of it) concerning his or her investigation or inspection.
Section 39 provides that s. 95 of the Employment Standards Act, 2000 applies with respect to service of documents under the Employment Protection for Foreign Nationals Act, 2009. For a discussion of s. 95 of the Employment Standards Act, 2000, which addresses issues such as methods of service, the effective date of service, the Ontario Labour Relations Board’s powers around service, and certificates of service, see ESA Part XXI.
Sections 125 to 129 of the Employment Standards Act, 2000, which are all provisions dealing with collections, apply to the collection of money which a person is liable to pay under the Employment Protection for Foreign Nationals Act, 2009. For a discussion of the Program’s interpretation of ss. 125 to 129 of the Employment Standards Act, 2000 see ESA Part XXIV.
Section 41 of the Employment Protection for Foreign Nationals Act, 2009 (EPFNA) is similar to s.132 of the Employment Standards Act, 2000 and applies to every person (a term which includes a corporation), who violates a provision of EPFNA, or disobeys an order made under EPFNA. An individual who is found guilty of an offence is liable to a fine of not more than $50,000 or 12 months in jail, or both.
A corporation that is found guilty of an offence is liable to a fine of not more than $100,000 for a first conviction, $250,000 for a second conviction, and $500,000 for a third or subsequent conviction.
Prosecutions under EPFNA may be initiated under Part I or Part III of the Provincial Offences Act, R.S.O. 1990, c P.33 ("POA"). A Part I prosecution can only be commenced by a person who has been appointed a provincial offences officer. Part I prosecutions are commenced by filing a certificate of offence with the Ontario Court of Justice and serving the accused with either an offence notice ("ticket") or summons. A ticket may only be used where a set fine for the offence in question has been established by the Chief Justice of the Ontario Court of Justice. At the time of writing, no set fine has been established for offences under EPFNA. However, a provincial offences officer may use the Part I summons procedure for EPFNA offences. The POA provides that where the summons procedure is used in respect of an offence under an Act, the provisions of the Act respecting maximum fines and terms of imprisonment do not apply; instead the POA provides that the maximum fine that can be imposed on conviction is $1,000. A sentence of imprisonment cannot be imposed if the summons procedure is used. If a prosecution is commenced under Part III of the POA, the s. 41 provisions regarding maximum fines and (in the case of an individual) maximum terms of imprisonment would apply.
Section 42 provides that a prosecution cannot be commenced under the Employment Protection for Foreign Nationals Act, 2009 (EPFNA) more than two years after the offence was committed or alleged to have been committed.
The date on which an offence has been committed or is alleged to have been committed is a question of fact. For example, a contravention of s. 10 (reprisal) would occur on the date the employer penalized the foreign national for exercising or attempting to exercise a right under EPFNA (e.g., the date the employee was terminated for having refused to pay costs the employer incurred in becoming his or her employer). A contravention of EPFNA's prohibition against a recruiter charging a fee in connection with the employment of a foreign national would occur on the day the fee is charged. A contravention of EPFNA's requirement to comply with an order to pay would occur once the order becomes final and binding (which, in the case where no application for review is made, is at the expiry of the period for applying for a review).
In the case of a prosecution under Part I of the Provincial Offences Act, R.S.O. 1990, c P.33 ("POA"), the prosecution is considered to commence when a certificate of offence is filed with the court office. In the case of a prosecution under Part III of the POA, the prosecution is considered to commence when a document called an "information" is laid under oath before a provincial judge or a justice of the peace.
In a prosecution for a prohibited reprisal, if the prosecutor establishes that the accused acted in a way that a reasonable person in the position of the foreign national would consider intimidating or punitive, or that the accused attempted or threatened to act in that way, the court could find that a person engaged in a prohibited reprisal in the absence of evidence to the contrary. In other words, if the prosecutor establishes those facts, the court can, in its discretion, shift the onus to the person who is alleged to have contravened s. 10.
Subsection 44(1) states that where a person is convicted of contravening s. 9 or 10, the justice of the peace or the provincial judge making the conviction shall, in addition to the fine or term of imprisonment, order specific action that the person must take or refrain from taking to remedy the contravention. (Thus, the court could order that the person convicted return the property that was taken or retained to the foreign national who has the right to possess the property.)
In addition to the powers granted to the court under s. 44(1), if an employer is convicted of contravening s. 10, s. 44(2) authorizes, but does not require, the court to order that the employee be paid any wages that are owing to the employee. The section also authorizes the court to order that the employee be reinstated or compensated by the employer, or both.
Note that pursuant to s. 45(1), where a person is convicted of contravening a provision of the Employment Protection for Foreign Nationals Act, 2009 (EPFNA) other than s. 10 (reprisal), the court is required to order the person to pay any amount owing to the foreign national with respect to the contravention.
Subsection 44(3) sets out the fine for a failure to comply with a court order made under s. 44(1) of EPFNA. For example, if the court, on conviction for a violation of s. 10, orders the employer to reinstate the foreign national with compensation for lost wages and benefits, and the employer fails to comply, the court may further order the person, if an individual, to pay a fine of up to $2,000 for each day that he or she failed to comply with the order of the court. In the case of a corporation, the court could order that a fine of up to $4,000 be paid for each day the person failed to comply with the court's order. For example, if the court orders that a certain amount of money be paid by August 1st, and the person did not do so until September 1st of that same year, the person could be fined up to $124,000, if a corporation, or $62,000, if an individual, for the failure to comply in a timely manner with the order of the court. The fine would be in addition to any fine or term of imprisonment imposed pursuant to s. 41.
Subsection 45(1) provides that where a person is convicted of contravening a provision of the Employment Protection for Foreign Nationals Act, 2009 (EPFNA) other than a conviction for a violation of s. 10 (reprisal), the court is required to assess any amount owing to the affected foreign national(s), in addition to any penalty (i.e., fine or term of imprisonment or both) imposed.
For example, where a recruiter had not paid an order to repay fees and accordingly committed an offence that resulted in a conviction under s. 41, the court is required (in addition to any fine or jail sentence that may be ordered) to assess the amount owing and to order the recruiter to pay the amount owing to the Director of Employment Standards in trust.
The court could not order the person convicted to pay the ten per cent administration costs portion of the order to repay fees, since the section refers specifically to an "amount owing to a foreign national affected by the contravention". However, the court's assessment of the amount owed to the foreign national(s) could include interest.
Subsection 45(2) indicates that the Director of Employment Standards must attempt to collect any money that is ordered to be paid under s. 45(1) and distribute it to the foreign national if the collection action is successful.
Subsection 45(3) provides that the Director of Employment Standards may file the court order issued under s. 45(1) in a court of competent jurisdiction. The order then becomes enforceable as an order of the court for the purposes of enforcement. This means, for example, that a writ of seizure and sale could be issued so that the defaulting person's assets could be seized and sold in order to satisfy the amounts owing.
Where a recruiter, person acting on behalf of a recruiter or an employer is a corporation and an order to repay fees or costs has been issued against a director of the corporation, s. 46(1) provides that the director is guilty of an offence if he or she fails to comply with the order, either as issued, where no application for review is made, or as amended or affirmed by the Ontario Labour Relations Board, where a review takes place and the Board amends or affirms the order.
The provision should be read in conjunction with s. 46(2) below which establishes a maximum fine for directors under s. 46.
Subsection 46(2) provides that a director convicted under s. 46(1) is liable to a fine of not more than $50,000. (Note that directors convicted under s. 46(1) are not liable to imprisonment.)
Subsection 47(1) provides that where a corporation contravenes any provision of the Act or the regulations, an officer, director or agent of the corporation (or a person acting or claiming to act in such a role) who authorizes, permits or acquiesces in the contravention is a party to and guilty of the offence and is liable on conviction to the penalty provided for the offence, i.e., a maximum of $50,000 fine and/or 12 months' imprisonment. This applies whether the individual's role in relation to the corporation's contravention is active, e.g., authorizing the act that constituted the contravention, or passive, e.g., being aware of the act but failing to take steps that he or she could have taken to prevent it.
Subsection 47(2) provides that the individual officer, director or agent may be convicted under this provision even though the corporation has not been prosecuted or convicted. Thus, a corporate director could be prosecuted under s. 47, even though a prosecution has not been commenced against the corporation under s. 41.
The key to s. 47 is that the officer, director or agent of the corporation must be a person who "authorizes, permits or acquiesces" in a contravention of the Employment Protection for Foreign Nationals Act, 2009 (EPFNA) by the corporation.
These provisions have the same wording as ss. 137(1) and (2) of the Employment Standards Act, 2000. For a discussion of the Program's interpretation of those provisions, which can be applied to EPFNA with necessary modifications, see ESA Part XXV.
These provisions indicate that where an individual is convicted of an offence under s. 47, the court may, in addition to any other penalty, assess the amount owed by the corporation in relation to the foreign national(s), and may order the individual to pay the amount assessed to the Director of Employment Standards in trust, who is required to attempt to collect the amount and, if successful, to distribute it to the foreign national(s). Please note that unlike s. 45(1), this section does not require the court to make an assessment and order the payment of wages to the Director upon conviction.
These provisions are similar to ss. 137(4) and (5) of the Employment Standards Act, 2000. For a discussion of the Program's interpretation of those provisions, which can be applied to EPFNA with the necessary modifications, see ESA Part XXV.
Subsection 47(5) provides that a prosecution under s. 47 of an officer, director or agent of a corporation (or person acting or claiming to act in such a capacity) that has contravened the legislation can only be commenced with the consent of the Director of Employment Standards. This power has been delegated pursuant to s. 33(2) of EPFNA which incorporates s. 88 of the Employment Standards Act, 2000 by reference.
This provision states that a document that appears to indicate the consent of the Director of Employment Standards (or his or her delegate pursuant to s. 33 of the Act) to prosecute under s. 47 is admissible as evidence of the Director's consent.
In a prosecution under s. 47, where the prosecutor establishes that an officer, director or agent (or person claiming to act in that capacity) was aware of the corporation's contravention of the legislation, the court may conclude that the individual authorized, permitted or acquiesced in the contravention in the absence of evidence to the contrary. In other words, if the prosecutor establishes that the individual was aware of the contravention, the court can, in its discretion, shift the onus to the individual.
Section 48 indicates that s. 138 of the Employment Standards Act, 2000 applies to prosecutions commenced under the Employment Protection for Foreign Nationals Act, 2009.
Subsection 138(1) of the Employment Standards Act, 2000 provides that the prosecutor can choose to have the prosecution of an offence conducted in the area where the accused resides or carries on business, rather than where the offence occurred as would normally be the case under the Provincial Offences Act, R.S.O. 1990, c P.33. For example, if the accused is a recruiter who lives in Hamilton and who is alleged to have illegally charged a foreign national a recruitment fee in Toronto, the Crown could require that the case heard in Hamilton.
Subsection 138(2) of the Employment Standards Act, 2000 provides that the Attorney General or his or her agent may, by giving notice to the clerk of the Ontario Court of Justice, require that the prosecution be heard by a judge of that court rather than by a justice of the peace.
Section 140 of the Employment Standards Act, 2000 applies with respect to documents, records and certificates of the Director of Employment Standards under the Employment Protection for Foreign Nationals Act, 2009.
Section 140 of the Employment Standards Act, 2000 states that a copy of an order, notice of contravention ("NOC") or record signed by an employment standards officer or by the Ontario Labour Relations Board constitutes evidence of the order, NOC or record. It also provides that certain certificates (e.g., certificate that an employer failed to pay an order) that appear to be signed by the Director of Employment Standards constitute evidence of facts indicated in the certificate.
See ESA Part XXVI for a more detailed discussion of s. 140 of the Employment Standards Act, 2000.
This section allows for the making of regulations under the Employment Protection for Foreign Nationals Act, 2009 (EPFNA). Subsection 50(1) was amended by the Stronger Workplaces for a Stronger Economy Act, 2014, S.O. 2014, c. 10, effective November 20, 2015 with the addition of the reference to a "class of persons" in clause (b) and the addition of clauses (c) and (d). At the time of writing, no regulations have been made pursuant to this subsection. It was further amended by the Fair Workplaces, Better Jobs Act, 2017, S.O. 2017, c. 22 to allow for the making of regulations governing the penalties attached to notices of contravention under EPFNA s. 27(1).
This subsection allows for any regulations made under s. 50(1) to apply only if certain conditions are met.
This section permits regulations to be made establishing different penalties or ranges of penalties for different contraventions as well as establishing different methods of determining those penalties and ranges. It also permits regulations to be made establishing different penalties, ranges of penalties and methods for establishing such penalties or ranges for contraveners who are individuals and contraveners that are corporations. Finally, it allows regulations to be made that prescribe the criteria an officer shall or may consider when imposing a penalty. At the time of writing, no ranges of penalties, methods, or criteria have been established and officers are therefore required in accordance with EPFNA s. 27(1.1) to apply the penalties prescribed in O. Reg. 47/10.