The extension will last another eight months until March 31, 2023.
Eligible workers will continue to get up to $200 a day for up to three days if they need to get tested, vaccinated, get booster shots, self-isolate or care for a family member who is ill from COVID-19, the government said.
The government said it will keep reimbursing eligible employers for the paid leave days.
Earlier in July, Premier Doug Ford was urged to extend the program as it was slated to end on July 31.
The provincial Worker Income Protection Benefit program was first introduced in April 2021 during the Alpha-Delta-driven wave of COVID-19 and extended amid the Omicron stage of the pandemic.
Since the program was implemented, government data shows around half-a-million workers have relied on the program to call in sick without interrupting their pay.
Previously, as of June 24, the government had said 470,000 workers have claimed a sick day, costing the province $189 million. The province said the bulk of the claims were made in the manufacturing, retail and health-care sectors, and the majority of which came from employees in Mississauga, Toronto and London.
— With files from Global News’ Colin D’Mello