Ontario has made a temporary change to its employment laws in response to the coronavirus pandemic.
While many small and medium-sized businesses welcomed the change, some employees were concerned it would affect their basic rights.
Shortly after the regulation was announced, my employment law team was flooded with questions from workers and businesses alike. It has become clear that this change has spread confusion about basic employment rights and has likely opened a Pandora’s box of severance pay claims against businesses in the province.
Here’s what employees and employers need to know about the changes to Ontario’s employment laws.
What is Ontario’s new temporary layoff regulation and how does it change the law?
On May 28, the Government of Ontario filed a temporary amendment to update the province’s infectious disease emergency leave.
The emergency leave was created to provide an unpaid and unlimited job-protected leave of absence for employees who are home sick from work, self-isolating or undergoing quarantine due to COVID-19. It also extends to workers who need time off to care for children or other relatives.
The new regulation allows an employer in the province to reduce a non-unionized employee’s pay or hours of work in response to the COVID-19 pandemic without facing a potential constructive dismissal claim resulting in severance pay for the employee.
A company can also put an employee on a temporary layoff without facing a potential constructive dismissal claim.
The regulation now considers an employee whose pay or hours have been reduced or who’s been placed on a temporary layoff to be on infectious disease emergency leave. An employee on this leave no longer has the ability to claim that a significant change to their employment has resulted in their termination.
The temporary change is retroactive to March 1 and expires exactly six weeks after Ontario ends the emergency order it currently has in place.
In other words, if you experience a pay cut or are put on a layoff now or within the six-week period after the emergency order is lifted, you can’t pursue a constructive dismissal claim.
So now my employer has the right to cut my pay or put me on a temporary layoff?
No. Despite the new regulation and what many businesses believe, your employer does not have the legal right to cut your pay, reduce your hours or put you on a temporary layoff before, during or after the coronavirus pandemic.
The regulation only prevents you from seeking recourse through the provincial ministry of labour.
But I thought the new Ontario regulation eliminates my right to severance pay?
The temporary layoff regulation in Ontario has cancelled an employee’s ability to collect their minimum severance pay, normally guaranteed by provincial employment laws, if their work has been impacted by COVID-19.
An employee who sees their pay cut or is put on a layoff is now considered to be on infectious disease emergency leave, rather than dismissed.
The regulation does not impact an employee’s full severance pay as governed by our country’s common-law system. This system is determined by our courts and is not directly impacted by provincial employment laws and new regulations.
You still have the right to claim constructive dismissal and seek full severance pay, under common law, if your employer makes a significant change to your job as a result of the coronavirus pandemic. A significant change could be a reduction in your wages, a change of hours or a temporary layoff.
How much severance pay should I get?
The amount you are owed is based on numerous factors, including your age, position and length of employment at the company, and can be as much as 24 months’ pay.
How do I get severance pay if unwanted changes have been made to my job?
If considerable changes have been made to your job, immediately contact an employment lawyer.
At Samfiru Tumarkin LLP, our employment lawyers have been pursuing constructive dismissal claims on behalf of many individuals across Ontario and securing full severance packages for our clients.
I’m an employer. Can I cut my employee’s pay or put them on a layoff?
An employer does not have the legal right to make significant changes to any aspect of an employee’s job. A change to the fundamental terms of their employment gives the worker the opportunity to treat the change as a constructive dismissal or termination, allowing them to leave their job with full severance pay.
What employers need to know about Ontario’s new temporary layoff regulation
Companies operating in Ontario should not be misled by the recent changes to the infectious disease emergency leave. The new regulation does not give employers carte blanche to make changes to their staff.
In fact, employers who choose to inappropriately apply the province’s new regulation may receive more claims for constructive dismissal than anticipated.
Questions about severance pay or a temporary layoff?
Check the Pocket Employment Lawyer from Samfiru Tumarkin LLP for a better understanding of how much severance you may actually be owed .
Contact the firm or call 1-855-821-5900 to secure assistance from an employment lawyer in Ontario or British Columbia. Get the advice you need — and the compensation you deserve — during this crisis.
Lior Samfiru is an employment lawyer and partner at Samfiru Tumarkin LLP, one of Canada’s leading law firms specializing in employment law and disability claims.