Canada: Rolling Back The Clock On Labour Reform In Ontario

On Oct. 23, 2018, the Ontario Government introduced Bill 47: Making Ontario Open for Business Act, 2018 ("Bill 47").  Bill 47 seeks to repeal most of the amendments to the Employment Standards Act, 2000 ("ESA") enacted by what we have now come to refer to as Bill 148, formally entitled the Fair Workplaces, Better Jobs Act, 2017 ("Bill 148"), passed in the final stretch of the Liberal's most recent term in power.

Bill 148 made significant and controversial amendments to the ESA and Labour Relations Act ("LRA"), most of which were not well received by employers.  Bill 148, introduced in June of 2017, stalled for several months leading up to and following first reading. Bill 148 then rapidly went through second and third reading, finally being passed on November 22, 2017, leaving very little time for employers to prepare for the changes, many of which took effect immediately or on January 1, 2018.  Employers were, however, provided limited lead time before the Equal Pay for Equal work provisions came into effect on April 1, 2018.   Employers have been preparing for the last of the changes, scheduling and on-call provisions, presently set to come into effect January 1, 2019, which, as a result of Bill 47, may never see the light of day.   

It is expected that the Progressive Conservative government has every intention of having Bill 47 passed before the current sitting of the Legislature ends on December 13, 2018, with the changes to be effective on January 1, 2019. 

What does this mean for employers?   Many of the changes will not require employers to once again revamp a large number policies which were just revised as a result of Bill 148.   The greatest change to existing policies that will result from Bill 47, if passed, is the proposed annihilation of Personal Emergency Leave (paid and unpaid), to be replaced by three new shorter, entirely unpaid leaves.  Yes, Personal Emergency Leave will be eliminated in its entirety.  It will be replaced by:  a) 3 day unpaid Sick Leave; b) 3 day unpaid Family Responsibility Leave; and c) 2 day unpaid Bereavement Leave. Details regarding these leaves are set out in the table below.   

One of the most significant challenges for employers will be for those who have already implemented changes to pay practices due to the Equal Pay for Equal Work provisions, and who would like to revert to former pay practices in place prior to April 1, 2018.  Unfortunately, even if Bill 47 passes, employers will not have the automatic right to reduce the pay of employees who received an increase as a result of Bill 148 Equal Pay for Equal Work provisions.   At common law, any pay increases have now very likely become implied terms/entitlements of employees' terms of employment. If employers unilaterally reduce an employee's pay, the employer may face a successful constructive dismissal claim. Accordingly, even if the Equal Pay for Equal Work provisions are repealed, employers should carefully consider and seek legal advice before reducing any employee's pay, even if it is to restore it to pre-Bill 148 rates.  

Employers should also be aware that the Ontario government has opted to maintain some limited aspects of Bill 148, including the expansion of vacation entitlement for employees with 5 years of service (from 2 weeks to 3 weeks), and the addition of domestic or sexual violence leave, which provided employees up to 10 individual days and 15 weeks of leave each calendar year.

The chart below summarizes the key changes to the Ontario Labour and Employment Legislation subsequent to Bill 148 and the proposed amendments by Bill 47:

ESA Provisions

Bill 148 Changes

Proposed Bill 47 Changes

Minimum Wage

$14/hour (Jan. 1, 2018)

$15/hour (Jan. 1, 2019)

Freezing the minimum wage at $14 as of January 1, 2019;

33-month pause in minimum wage increases with annual increases, tied to inflation, to restart in 2020.

Scheduling and On Call

(To be in effect as of January 1, 2019)

Right to request changes to schedule or work location after an employee has been employed for at least three months.

Right to refuse requests or demands to work or to be on-call on a day that an employee is not scheduled to work or to be on-call with less than 96 hours' notice.

Requirement to pay employees a minimum of 3 hours' pay in the event of cancellation of a scheduled shift or an on-call shift within 48 hours before the shift was to begin.

Requirement to pay employees a minimum of 3 hours' pay for being on call even if they are not called to work.

Provisions to be repealed, including the new record keeping requirements associated with these provisions.

The former 3-hour "show up pay" rule will still apply.

Independent Contractors

Reverse onus on the employer as to the classification of employees.

To be repealed in its entirety.

Equal Pay for Equal Work

(Part XII of the ESA)

Equal pay for equal work on the basis of employment status (part-time, casual, and temporary) and assignment employee status (temporary help agency status).

Employees may request a review of their rate of pay requiring either an adjustment of the rate of pay or a written response setting out the reasons the employer disagrees with the employee.

Repealing equal pay for equal work on the basis of employment status (part-time, casual, and temporary) and assignment employee status (temporary help agency status).

Maintaining the requirement for equal pay on the basis of sex.

Personal Emergency Leave

Employees are entitled to 10 job protected days off from work (of which 2 are paid) to deal with:

a) personal illness, injury or medical emergency;

b) death, illness, injury or medical emergency of a prescribed individual;

c) urgent matter that concerns a prescribed individual. 

To be repealed in its entirety – no more Personal Emergency Leave.

To be replaced with:

Sick Leave:  employees with 2 consecutive weeks of employment may take up to 3 unpaid days of leave annually to deal with personal illness, injury or medical emergency. Family Responsibility Leave:  employees with 2 consecutive weeks of employment may take up to 3 unpaid days of leave annually to deal with illness, injury, medical emergency, or urgent matter relating to a prescribed individual.

Bereavement Leave:  employees with 2 consecutive weeks of employment may take up to 2 unpaid days of leave annually to deal with death of a prescribed individual.

For each of these types of leave, an employer will be permitted to request reasonable evidence from the employee to support the requested leave.

Also, Bill 47 is clear that where the employee has a paid or unpaid leave entitlement under their employment contract, such leave taken under the contract will also count for statutory purposes.

Public Holiday Pay

Bill 148 changed the prior calculation of public holiday pay from January 1, 2018 up to July 1, 2018.  It was restored to the pre-Bill 148 calculation as of July 1, 2018 being:  the total amount of regular wages earned and vacation pay payable to the employee in the four work weeks before the work week in which the public holiday occurred, divided by 20.

Bill 47 will confirm that the old calculation (the pre-Bill 148 calculation), restored as of July 1, 2018, is the lawful calculation for Ontario. 

Sheltered Workshops

Exclusion from the ESA of individuals who perform work in a simulated job or working environment if the primary purpose is the individual's rehabilitation. (this provision was to be repealed on January 1, 2019)

Delaying the January 1, 2019 repeal of the exclusion. The repeal would instead come into force on proclamation of Bill 47.

Penalties for Contravention*1

Maximum administrative penalties for contraventions of the ESA $350/$700/$1500

Reverting to previous administrative penalties for contraventions of the ESA by decreasing the maximum penalties to $250/$500/$1000

LRA Provisions

Bill 148 Changes

Proposed Bill 47 Changes

Application for employee lists

Permits a trade union to obtain a list of the employees of an employer and certain related information

To be repealed

Card-based Certification

Provides for an alternate trade union certification process in the building services industry, the home care and community services industry and the temporary help agency industry

To be repealed

Remedial Certification

The Board was empowered to certify the trade union as the bargaining agent of the employees in the bargaining unit if it determined it could be appropriate for collective bargaining

To be repealed

Requiring the OLRB to determine whether a vote or new vote would be a sufficient remedy, or whether the only sufficient remedy would be to certify the union.

Successor Rights

Application of  successor employer rights to other types of service providers that directly or indirectly receive public funds

To be repealed

Return-to-work Rights

Reinstatement of employee at conclusion of strike/lock-out

Reinstatement of an employee if an application is made within six months following commencement of a lawful strike, subject to conditions

First Collective Agreement Mediation and Mediation-Arbitration

Provides for first collective agreement mediation and mediation-arbitration and provision for educational support

To be repealed;

To be replaced with pre-Bill 148 conditions for access to first agreement arbitration (where it appears to the OLRB that collective bargaining has been unsuccessful for specified reasons).

Fines

Increased maximum fines for offences under the LRA to $5,000 for individuals and $100,000 for organizations.

Returning to the previous maximum fines for offences under the LRA by decreasing the fines to $2,000 for individuals and $25,000 for organizations.

As indicated above, Bill 47 proposes to roll-back many of the changes introduced by Fair Workplaces Act. The proposed amendments also seek to provide greater flexibility to employers in structuring their workplaces, requiring compliance with less stringent rules, and reducing penalties for non-compliance. Of course all of the above is subject to the new provincial government continuing to be in power and on the pretext that Bill 47 becomes law.

A quick link to Bill 47 can be accessed here.

Read the original article on GowlingWLG.com

Footnote

1 Note that while Bill 47 does not specifically revoke or amend regulation 289/01: Penalties And Reciprocal Enforcement, this information is provided in the  note released by the Ministry of Labour addressing highlights of Bill 47 which leads us to believe that there may be a regulation in the works which will replace the existing one.

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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