Big Changes for COVID-19 Layoffs in Ontario: New O. Reg 228/20 Infectious Disease Emergency Leave Curtails Constructive Dismissal Claims

new Infectious Disease Emergency Leave regulationAs many of our readers and clients know, we have been cautioning that the legality of certain layoffs and job changes necessitated by COVID-19 is uncertain. Generally, layoffs are only legal if the employment contract gives the employer the right to layoff, and many other job changes, such as reductions in hours or pay, raise the risk of constructive dismissal. We anticipated that at some point the Ontario government may weigh in and change the law – on Friday they did.  

Note that none of these changes apply to unionized employees. 

O.Reg 228/20

On May 29, 2020, the Ontario government tabled a new Infectious Disease Emergency Leave regulation under the Ontario Employment Standards Act (“ESA”). This new regulation, O. Reg 228/20 changes the previous Infectious Disease Emergency Leave O. Reg. 66/20 which established job protection for workers who needed time off due to various impacts of COVID-19. See our blog on the Infectious Disease Emergency Leave for more details. This previous, more limited leave applies for the period January 25, 2020 to March 1, 2020 and to unionized workers. Job protection means that workers who assert their right to this leave cannot be terminated for not working. 

  1. Reg 288/20 has changed things up quite a bit and greatly expanded job protection under the leave, as well as changed the impact of layoffs and job changes. 

The Really Big Change for Employers

  • The expansion of job protection widens an employer’s options regarding terminations and layoffs for employees who may be redundant due to COVID slowdowns. 
  • Employees who have had their hours reduced or cut altogether due to COVID slowdowns starting March 1, 2020, and onwards, and lasting until six weeks after the day that the State of Emergency in Ontario is terminated, are now – in most cases – deemed to be on the Infectious Disease Emergency Leave. 

So upcoming terminations could be impacted and an employee’s ability to do anything about past layoff and job changes – which could have been constructive dismissals under the ESA – are curtailed with certain exceptions. 

A note about benefits: employers who did not continue their employees’ participation in benefit plans when job changes were made (hours reduced, laid off etc.) prior to May 29, 2020 do not have to re-instate those benefits. Otherwise, benefits should be continued during the leave. 

Impact on Employees Who Were Laid Off or Had Hours or Pay Reduced

Many employees were unlawfully laid off or had their pay or hours cut – either partially or completely. Normally these types of drastic job changes would entitle an employee to assert a constructive dismissal claim and their right to notice of termination (notice pay and possibly severance pay). O.Reg 288/20 takes away that right going forward from May 29, 2020,  as far as the ESA is concerned – a constructive dismissal claim could still go forward under the common law. These employees will now be deemed to be on the  Infectious Disease Emergency Leave. 

Similarly, employees on layoff are now deemed to be on an unpaid leave of absence – the Infectious Disease Emergency Leave. This will not be the case however if the layoff has already lasted too long (generally more than 13 weeks) or the employee has already asserted a constructive dismissal in response to the layoff within a reasonable period.  

Being on a leave gives these employees the right to return to their job – should it still exist – when the leave is over. The leave will be over on the day that is six weeks after the end of the State of Emergency in Ontario. 

Terminations Prior to May 29, 2020

Employees who were terminated prior to May 29, 2020, are not impacted. These terminations stand. Similarly, if employees were on layoffs that expired prior to May 29, 2020 (lasted longer than 13 weeks in most cases) or where employees asserted constructive dismissal and resigned within a reasonable time these employees will not be deemed to be on the Infectious Disease Emergency Leave. Wrongful dismissal actions will still go ahead for these employees. 

Upcoming Terminations and Layoffs 

O.Reg 288/20 says as of March 1, 2020, an employee whose hours of work are temporarily reduced or eliminated for reasons related to the designated infectious disease are deemed to be on the Infectious Disease Emergency Leave. They, therefore, have job protection under the leave and cannot be terminated. They have a right to return to their job, or a comparable job, when the leave is over – should their job still exist. 

The regulation also says that an employee is not on leave if their employment is terminated on or after March 1, 2020. This suggests that employers can still proceed with upcoming terminations in most cases but would also have the option of putting employees on the leave and recalling them at some point or terminating them if their job no longer exists six weeks after the State of Emergency is over. 

Employees on the Infectious Disease Emergency Leave following May 29, 2020, should have their benefits continued. They do not need to be otherwise paid and will be eligible for the CERB. 

Final Thoughts 

For many employers, this is good news. It simplifies the legal risk associated with the necessary job changes so many have had to make. Where there is limited work available, most employees who were not already terminated or who did not assert a constructive dismissal within a reasonable period will now be on the Infectious Disease Emergency Leave. Note that the law is unclear on what “within a reasonable period” means and this may be different in different situations. 

For employees, many of whom may have thought that they were in a legal position to assert their termination entitlements are now not. Common law rights remedies for illegal layoffs and constructive dismissal still stand, but it’s fair to say that access to justice has been impeded.  

If you need help understanding how O.Reg 288/20 impacts your situation get in touch for a consultation. 

COVID-19 and Proposed Amendments to the Workplace Safety and Insurance Act, 1997

COVD-19 and WSIBOntario potentially has another new COVID-19 related law on the horizon, this time related to worker’s compensation. On May 19, Bill 191, Workplace Safety and Insurance Amendment Act (Presumption Respecting COVID-19), 2020 passed first reading in the Ontario Legislature. 

COVID-19 a Presumptive Occupational Disease for Essential Workers

If the Bill is passed, it will amend the Workplace Safety and Insurance Act, 1997 to add a presumption that COVID-19 is an occupational disease for workers working for essential businesses as deemed by an Order under the Emergency Management and Civil Protection Act

You can see all the Orders made under the Emergency Management and Civil Protection Act listed under the Regulations under this Act tab. 

If the Bill is passed, the new presumption would mean that COVID-19 cases would more easily be deemed to have arisen from the infected person’s work, therefore, entitling them to WSIB coverage. It would also vacate COVID-19 claims from essential workers that had been denied prior to the Bill coming into force. Vacating a denied claim would mean that the worker could refile their claim and have it determined taking advantage of the new presumption.  

Current WSIB Treatment of COVID-19 Claims

As it stands currently, the WSIB has been individually adjudicating WSIB claims rising from COVID-19. You can learn more about how the WSIB makes these adjudication decisions by reading the WSIB’s Adjudicative approach to COVID-19 claims document

The WSIB has information on their website breaking down which industry/sector COVID-19 WSIB claims are coming from. Currently, nursing and residential care facilities top the list for number of claims, with 619 having been allowed, 31 not allowed and 1,179 pending. In all sectors, the WSIB has allowed 983 claims, not allowed 275 and has 2,439 claims pending. 

Private Member’s Bills Don’t Usually Pass

Notably, Bill 191 is a private member’s bill and most private member’s bills do not pass into law, so it does remain to be seen whether the Bill will pass. This bill was brought by Niagara Falls NPD MPP Wayne Gates.  We will keep you updated.

Do you have questions about the impact of COVID-19 on your workplace? Get in touch for a consultation. 

A Guide for Employers During COVID-19 – May 22 update

A Guide for Employers during COVID-19A Guide for Employers during COVID-19

This Guide sets out the key employment law issues to consider, as well as the government’s financial relief options to explore to get through this deep economic crisis.  (Last Updated May 22, 2020).

Further free resources can be found here.

Should you need legal advice on how to manage your workplace during the COVID-19 outbreak, please get in touch.

Government Benefits and Bringing Employees Back: The CERB and CEWS

This week in Ontario many businesses are re-openingThis week in Ontario many businesses are re-opening. Employers and employees alike have questions about going back to work and the intersection of re-starting businesses with the various government subsidies that have been tiding many people over. 

Bringing Employees Back to Work Using the Canada Emergency Wage Subsidy (CEWS)

Many employers have laid off a good portion of their workforce and now with re-opening are looking to bring some of those workers back. Businesses that have been hit hard financially may be able to take advantage of the CEWS while earnings are still uncertain as business ramps back up. Getting the CEWS for employees who have been laid off is a little complicated because of the definition of an eligible employee. But first, let’s look at eligible employers. 

Eligible Employers 

Most employers are eligible for the subsidy, including individuals, partnerships, taxable corporations, non-profits and registered charities. Check out the government’s webpage on who is an eligible employer.

A reduction in revenue of either 15% or 30%, depending on the eligibility period, is required. This can be calculated using the corresponding month in 2019 or the average revenue from January and February 2020. 

Eligible Employees 

An eligible employee is an employee who has not been without pay for more than 14 consecutive days in the eligibility period. The eligibility periods are as follows: March 15 to April 11, April 12 to May 9, and May 10 to June 6. The CEWS has been extended to August 29, 2020, so we can expect another eligibility period from June 6 to August 29 to be added, however, this is not currently reflected on the government websites as they likely still need to determine the dip in profits required for this period. If an employer is applying for the CEWS for one of these periods they need to have paid their employee for all the time during that period, other than 14 consecutive days. 

This complicates matters when trying to use the CEWS for employees who have been laid off. Many businesses closed during these periods were not paying employees at all, meaning that their employees will not meet the definition of an eligible employee because they have been without pay for more than 14 days in the eligibility period. 

Eligible employers can still take advantage of the CEWS by re-hiring employees retroactively and paying them for all but 14 consecutive days of the period they are applying for – effectively bringing the previously laid-off employee into the definition of an eligible employee. 

For example, if an employer wants to use the CEWS going forward, they can apply for the period May 10 – June 6. To be eligible they will need to show a 30% reduction in revenue. The employer will need to re-hire previously laid-off employees and pay them a lump sum to account for their pay during the period. The employer can exclude 14 days of pay if the employee was not working. The wage subsidy will then cover 75% of the employee’s wage, up to a maximum of $847 per week, per eligible employee including retroactive payments during the eligibility period. 

Currently, the wage subsidy is available from March 15, 2020, to August 29, 2020 and can be received retroactively for time that has already passed. 

Employees on the Canada Emergency Response Benefit (CERB)

Many laid-off employees will have been receiving the CERB. An employee will usually not be eligible for the CERB if they are also being paid. This is something that employees should be aware of when rehired, particularly if they are re-hired and paid retroactively – ie for time that has already passed. 

If employees who are re-hired already received the CERB for the same period for which they are now being paid, the employee will likely be required to re-pay any CERB payments received for the same period.  

There is a lot of good information on government websites, but accessing government benefits and getting back to work brings up lots of questions! Get in touch to set up a consultation so we can help you navigate bringing employees back to work. 

Considerations for Employers as We Return to Work

considerations for employers as the provinces are opening back upThe provinces are opening back up and various guidance has been issued to employers regarding how to do so safely, but the virus still exists and it’s still contagious. Governments who have been encouraging people to stay home are now contemplating how to get people to go out when really conditions regarding the virus have not drastically changed. This juxtaposition will have an impact on workplaces. 

Employee Work Refusals

We can anticipate that some employees will refuse to come back to work, even if they have been recalled and even where the employer has followed government guidance on how to make a return to work safe. What should employers do with these employees?

In Ontario, the Occupational Health and Safety Act (OHSA) allows employees to refuse to work where she or he believes that conditions are unsafe. You can read more about the right to refuse unsafe work in the Ontario Guide to OHSA.

Does the Existence of the Coronavirus Make Work Unsafe?

Whether or not the existence of the coronavirus is sufficient to constitute a valid reason for an employee to refuse work is an open question, but the threshold in Ontario is high – work must be dangerous and not merely risky. 

Work could be dangerous to a particular employee if he is somehow especially vulnerable. Work could also be dangerous if the employer is not taking precautions or following appropriate guidance. 

Calling in the Ministry of Labour

There is a specific process to follow when an employee asserts a work refusal under OHSA, with calling in the Ministry of Labour (MOL) to make the determination being a final step. We can expect the MOL might be pretty busy as more and more people are expected to go back to work. 

If a workplace is determined safe, and an employee continues to refuse to return to work, then in many cases an employer may be able to terminate the employment relationship. Employers do need to keep in mind that some employees may be entitled to job protection under the Ontario Infectious Disease Emergencies Leave.   

Employee Privacy Concerns

Employee privacy also needs to be kept front of mind as workers return. For example, is it a reasonable invasion of the employees’ privacy to take their temperature as they walk through the door each morning? What if one employee falls ill? Do all the other employees have a right to know who the sick employee is? The answers to these and other questions that will come up as we slowly try to adjust will depend on the specific circumstances, bearing in mind the need to balance safety and the individual employee’s privacy rights. 

Do you have questions about how to return your employees to work? Get in touch for a consultation. 

A Guide for Employers During COVID-19 – May 8 update

A Guide for Employers during COVID-19A Guide for Employers during COVID-19

This Guide for Employers During COVID-19 sets out the key employment law issues to consider, as well as the government’s financial relief options to explore to get through this deep economic crisis.  (Last Updated May 8, 2020).

Further free resources can be found here.

Should you need legal advice on how to manage your workplace during the COVID-19 outbreak, please get in touch.

Re-opening Your Business During COVID-19

re-opening business during COVID-19Many provinces across Canada have started the process of re-opening businesses. In Ontario, a select few seasonal businesses have been allowed to open this week with restrictions. These include seasonal businesses and some essential construction. Check out the Provincial News Release for the details. 

While the list is still very short, we can be sure that, eventually, society will be back up and running, but it may look a little different. 

Guidance from the Government

The Federal and Provincial governments have released an agreed-upon set of common principles to follow with respect to re-opening. The statement includes a commitment to support and monitor workplace protocols that are in place to keep Canadians safe at their jobs, and prevent the introduction and spread of COVID-19.

Further to this, the Ontario government has released a very detailed resource on the protection of workers, customers and the public from COVID-19. The guidelines are sector-specific and include workplace posters.

The Ontario government also launched a website where businesses can request a temporary rule or regulation change to help “remove obstacles and streamline Ontario’s ability to respond to the outbreak.” 

Consideration For Employers

In addition to following any of the specific government guidelines noted in the links above, employers can start to think about some of the following:

  • Who’s going to be in charge? Consider establishing a working group to take charge of re-opening and becoming familiar with the government’s guidance. It’s a big job and should not be done ad hoc! 
  • What will you do if you have to scale back? Make sure your plan is fluid and considers things like another shutdown or scale back. 
  • Keeping workers safe should be a priority. Consider how to change the layout to allow for physical distancing, as well as if workers need to stagger hours or work in shifts. 
  • Communicate with workers, customers etc. Stakeholders should be kept in the loop. Employees should know what the plan is so that they feel safe returning to work.
  • Establish policies so that everyone in the workplace knows how to follow guidelines. 
  • Consider how to deal with workers who refuse to return to work, in spite of your planning. While these will likely all require a case by case analysis, it’s a good idea to turn your mind to the possibility that not all workers will comply with returning to work. 

For further information and resources on re-opening, we invite you to join us at our next free SpringForward webinar “Pivoting After Quarantine: Recalling, Restructuring & Rebuilding” on Wednesday, May 20th at 10:30 AM EST.

If you have questions about the legal impacts of COVID-19 on your business and workforce get in touch to schedule a consultation. 

Welcome Jessyca Greenwood to the SpringLaw team

SpringLaw is super excited to share that Jessyca Greenwood has joined our team!  Jessyca brings with her over a decade of experience as a trial lawyer with a focus on criminal law, professional misconduct, mental health advocacy, and the complex way these areas intersect with the workplace.

Jessyca’s skills as a fierce advocate will fuel our expanding litigation practice.

Through her busy practice, she brings a deep knowledge of the impact mental health has on businesses, workers, and employers, and will continue to broaden SpringLaw’s expertise in mental health advocacy, crisis management and workplace safety. Her experience with regulatory law and professional misconduct will support our executive and professional employee practices.

Jessyca’s tech-savvy and uber-efficient approach to her client matters syncs up with SpringLaw’s online virtual platform, and we are excited to grow our practices together.

We’re so thrilled to have her on board!

Jessyca can be reached at jgreenwood@springlaw.ca.

How Can I Afford Legal Advice if My Business is Sinking?

Can I Afford Legal AdviceHow Can I Afford Legal Advice?

Many employers are facing rock hard choices right now: layoff on shaky legal ground or go bankrupt? Let some employees go, but how to afford termination pay? Offer more than ESA minimums to get a release or risk a claim down the road?

Since early March 2020, we’ve found ourselves regularly telling clients what the technical legal answers are, and then we quickly move to the COVID-19 business reality solution. This new world order is not going away anytime soon and I fully anticipate some new law coming out of this unique moment. Employers cannot afford payroll but employees cannot mitigate their job loss in this job market – so everyone is turning to the pandemic economic crisis as the reason for paying less termination pay or for demanding more of a package. Courts will have to somehow reconcile these competing interests, each of which is based on the same underlying issues caused by COVID-19.

Now is the moment for businesses to get creative, think about what the world will look like in a year, and to consider what people they need on board to get there. Most business owners we’re talking to have already been knee-deep in doing just that. Most business owners have typically already spent hours trying to reconfigure the numbers for a reset before they contact us. 

The Free Help

By the time we get the call, the typical client has already read through all the free info available:

But many businesses still need legal help for their snowflake issues.

The Self-Serve Option

In this hard cash crunch moment, employers are looking to more affordable options besides the traditional $400+ an hour legal advice. The quarantine has forced the business world to quickly move online and to get a lot more comfortable with online solutions, including legal solutions. 

Hearing the demand for quick solutions for savvy business owners who prefer the convenience and speed of accessing legal guides and templates online, we launched Pivot DIY in early April. We sell this offering for $450+HST, intentionally low and affordable for small businesses needing to rightsize their workplace asap. 

We see this as the way of the future – accessing legal help online, off-hours, at the user’s convenience. Business owners and entrepreneurs are increasingly turning to self-serve and DIY solutions, confident in their own ability to sort through the main stuff, and picking up the phone or sending an email to their lawyer for the more nuanced questions. 

The reality is most businesses have far more legal issues in common that not. If you can get at that broad common info at a very affordable price, you can use your business sense for much of the rest. For the truly unicorn snowflake issues, lawyers are awesome. But there are some great options to consider before the unicorns arrive.

Whether you have unicorns at your door or you want a new way of accessing DIY online legal services, we’re here to help.

Rightsizing Your Workforce During COVID-19

resources for employers during COVID-19

Unchartered Workplace Waters

For many entrepreneurs and small businesses, the impact of COVID-19 has resulted in unprecedented losses in a short period of time.  It has been a time of incredible stress, uncertainty and countless questions about how you can stay afloat, best manage your team and, eventually, rebuild. 

At SpringLaw, we have been navigating these unchartered waters with our employer clients.  We know how small businesses have been struggling and how business owners are laying up at night wondering how they will see it through to the other side of this tremendous business disruption.

You Are Not Alone!

As an employer, you know you need to pivot and resize your business. You want to do best by your employees, your business model and your own employment.

You care deeply about your team and your “baby” – your business, along with your reputation and keeping a roof over your family’s head.  You want to be ethical and empathetic, but know you must also be pragmatic and that your decisions must be legally sound. 

You are likely thinking, among many other things:

  • Do I need to layoff or terminate my staff?  What’s the difference?  How do I do it?
  • What government relief is available to me and how do I best use it?
  • When and how can I recall my team?
  • OMG the paperwork!!!

You are not alone!  Many, many businesses are grappling with these tough decisions.  You know they need to be made, but you need a starting point, a roadmap and some guidance on how to navigate this challenging journey, while also managing a payroll cash crunch and a tightened budget.

Pivot DIY – A Budget-Friendly, Easily Accessible Solution for You!

To assist you through this unprecedented time, SpringLaw has launched a new business solution to help you survive and thrive – Pivot DIY.  This toolkit gives small business owners and entrepreneurs the strategies, how-to guides and templates to help you weather the impact of COVID-19 on your business and workforce.

This solutions toolkit has been crafted by experienced, licensed Canadian employment lawyers. Designed for this moment of business uncertainty, Pivot DIY is a user-friendly, easy to read, up to date resource relevant to today’s business crisis.

What’s Included?

Templates Written by Ontario Lawyers:

  • Termination Letter & Release
  • Layoff Notice
  • Recall Notice

Trusted How-To Guides and Resources:

  • How to pivot your workforce (and business) in the era of COVID-19
  • Guide to Termination Letters & Releases
  • Guide to Layoffs – Are they legal? Pros, cons, risks
  • Guide to Firing an Employee (includes Checklist & Script for Conducting Terminations & Layoffs)
  • Resources cheatsheet for you to give employees to help with their own pivots
  • Checklist of Government Resources for Benefits &  Funding Help
  • Access to our frequently updated videos & resources about small business in the COVID-19 era

Empowerment:

  • Take the direction of your business back into your hands
  • Pivot with the right number of people, explore the options for reducing hours or pay, accessing government relief & other temporary measures to survive
  • Get templates to work with to save you time
  • Deal with your team with dignity, fairness & with strategic vision
  • Position your business to move into the forever-changed economy focused on your core team & clarity of mission

You’ve Got This!

Whether you want to go fully DIY with your pivot or you want a cost-effective headstart before speaking to a lawyer, Pivot DIY is available to you right now for an affordable, set price.

Pivot DIY empowers you to take back the direction of your business by providing you with the tools (scripts, templates, guides, checklists, information etc) you need to resize and rebuild in the new 2020 business landscape. 

All this is available right now, at the budget-friendly, one-set price of $450+HST.  You can gain access to all the templates, guides and other resources now and get to work right away on your pivot.

Click here to learn more about Pivot DIY,  view our free COVID-19 resources, and immediately access your solutions toolkit.

Stay healthy, safe and well!

LexBlog