The Ministry of Labour ("MOL") has announced that
starting in September 2014, it will embark on a three-month random
spot audit in industries that the MOL considers to be "known
to hire a high proportion of vulnerable or temporary foreign
workers, including restaurants, building services, personal care
services (e.g., hair, aesthetics, massage services), business
support services (e.g. collection agencies, call centres) and
horticulture (e.g., nurseries, greenhouses)." The MOL
considers employees in these sectors to be particularly vulnerable
to exploitation and has taken an interest in ensuring employers are
complying with basic employment standards.
The MOL will be checking for compliance with the requirements of
the Employment Standards Act, 2000 (the "ESA")
and will have a particular focus on compliance with public
holidays, vacation pay, minimum wage, record keeping and payment of
Spot audits, although concerning, are not uncommon. The
MOL's announcement of the current spot audit is a good reminder
that under the ESA, the MOL has the broad power to send an
investigator into any workplace in Ontario, at any time, without
prior notice or a warrant, to conduct an inspection of the
employer's records (including removal and copying of records)
and to question any person in order to evaluate the company's
compliance with employment standards, including record keeping. An
employer cannot refuse to cooperate with any investigation, and the
MOL can seek a warrant to enter a workplace if necessary. Depending
on the results of an audit, the MOL can make orders ranging from
ordering the employer to comply with the ESA to payment of back
wages of up to a maximum of $10,000 per employee. In extreme cases,
such as falsification of records or providing misleading
information, an employer can be liable for an offence and a fine of
up to $100,000 (up to $500,000 for multiple offences) and/or
imprisonment for up to 12 months.
The spot audit is also a good reminder to take a minute to
consider your organization's current internal record retention
policy to ensure it is in compliance with the record keeping
requirements of the ESA. The ESA requires employers to keep and
retain the following records:
The employee's name and address, for 3 years
The employee's date of birth, if the employee is a student
and under 18 years of age, for the earlier of 3 years after the
employee's 18th birthday or 3 years post-employment.
The date on which the employee began his or her employment, for
3 years post-employment.
The number of hours the employee worked in each day and each
week, for 3 years after the day or week to which the information
Wage statements, including vacation pay, for 3 years after the
information was given to the employee.
Vacation time and vacation pay records, for 3 years after the
record was made.
All documents related to an employee's statutory leave of
absence, for 3 years after the leave ended.
These record keeping requirements are minimum standards only and
your internal policy may exceed these time frames. Moreover, the
ESA does not govern record keeping in respect of many other
employment-related documents, such as employment applications,
employment agreements, evaluations, medical records, training
course and tax records, pension plans (including CPP), benefit
enrolment and health and safety records. Your record retention
policy should endeavour to cover all records reasonably related to
the employment relationship.
The content of this article is intended to provide a general
guide to the subject matter. Specialist advice should be sought
about your specific circumstances.
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