Canada: Massive Overhaul Of The Canada Labour Code Pending

A massive overhaul of the Canada Labour Code (CLC) is pending, with significant amendments coming into force on September 1, 2019, just prior to the Canadian federal election in October.

The CLC is the statute that sets out labour and employment laws (including minimum employment standards) that apply to federally regulated employers whose activities are of an inter-provincial nature or national concern, such as navigation and shipping; the regulation of trade and commerce; banking; airlines; railways; radio and television broadcasting; inter-provincial transport; and immigration. 

Federal Government Decides to Modernize CLC

In 2017, the Minister of Employment, Workforce Development and Labour (Minister) began to address how to modernize the CLC to better respond to how Canadians work today.  Between May 2017 and March 2018, the Minister and officials from the Labour Program of Employment and Social Development Canada consulted with unions and labour organizations, employers and employer organizations, academics, other experts, and advocacy groups to get their perspectives on how federal labour standards should be modernized. 

The federal government released a report in August 2018 titled, "What we heard: Modernizing federal labour standards" (Report), that summarized the shared perspectives.  The common theme was this:  The way Canadians work has changed due to competitive global markets, the widespread use of digital technologies, and the shift away from traditional employment to new types of work arrangements including gig and on-demand work. Federal labour standards required modernization to better reflect these 21st century realities. The Report addressed the following specific subjects: leaves and annual vacation; work-life balance; non-standard employment; termination of employment provisions; and wages and benefits.

Simultaneously with the consultations, Parliament proposed amendments to the CLC in the following omnibus bills:

Bills C-44, C-63 and C-86 all amend Part III of the CLC (addressing standard hours, wages, vacations and holidays), while Bill C-65 amends Part II of the CLC (occupational health and safety). A small fraction of the amendments has already been proclaimed into force.  A significant number of the remaining amendments come into force on September 1, 2019, prior to the October election.  The Governor-in-Council's orders fixing "in force" dates have not been implemented with respect to the balance of amendments, which are also significant in number.    

Set out below is a summary of the key CLC amendments in each of the omnibus bills that received Royal Assent. Known "in force" dates are noted. 

Part 1:  Amendments to Part III of the CLC (Standard Hours, Wages, Vacations and Holidays)

BILL C-44

STATUS: Proclaimed partially in force December 3, 2017 and April 1, 2019—balance pending

Some CLC amendments in Bill C-44 came into force on December 3, 2017, and others on April 1, 2019; the remainder will come into force on a day to be fixed by order of the Governor-in-Council.  Listed below are some of the more significant amendments. 

The following amendments relating to new and expanded leaves of absence came into force on December 3, 2017:

  • Parental Leave:  Unpaid parental leave to care for the worker's newborn or adopted child was increased to up to 63 weeks;
  • Aggregate Amount of Maternity and Parental Leave:  The aggregate amount of maternity and parental leave that can be taken by one or two employees for the same birth or adoption was increased to a maximum of up to 78 weeks;
  • Maternity Leave: A woman's right to begin maternity leave was increased to up to 13 weeks prior to her due date;
  • Leave to Care for Critically Ill Child: Eligibility to take leave to care for a critically ill child was expanded from a parent to a family member of a critically ill child; and
  • Leave to Care for Critically Ill Adult:  A new leave of up to 17 weeks to care for a critically ill adult family member was created. 

The following key amendment came into force on April 1, 2019: 

  • Internal Self-Audit Orders:  The Minister may order an employer to conduct an internal self-audit of its practices, books, payrolls and other records to verify compliance or to prevent non-compliance with Part III of the CLC, and to provide the Minister with a report of the results. 

The following key amendments Bill C-44 proposed are not yet in force: 

  • Monetary Penalties to Promote Compliance: A comprehensive monetary penalty system to promote compliance with Part II and Part III of the CLC will be established;  and
  • Complaint Procedure for Employer Reprisals:  A procedure under Part III of the CLC to complain to the Canada Industrial Relations Board will be established for any employees who believe their employer has taken specified reprisals against them.

BILL C-63

STATUS:  Proclaimed in force September 1, 2019

On June 12, 2019, the federal government announced that amendments to the CLC in Bill C-63 (and related amendments in Bill C-86—see below) will come into force on September 1, 2019.  Key amendments to the CLC in Bill C-63 include:

  • Flexible Work Arrangements: After six consecutive months of continuous employment, an employee may make a written request to change the number of work hours, schedule, location of work, and other terms and conditions prescribed by regulation.  The employer has the right to refuse the request in specified circumstance,s such as if the requested change would result in the employer incurring additional burdensome costs, or have a detrimental impact on the quality or quantity of work; if the employee would not have sufficient work; or if the reorganization of work among employees is not possible. 
  • Overtime:  An employee may agree with the employer that the employee will be granted not less than 1.5 hours of paid time off for each overtime hour worked.  In addition, subject to exceptions in certain emergencies, employees may refuse to work overtime if they must fulfill a family responsibility provided they have taken reasonable steps to carry out the family responsibility by other means. 
  • Shift Change:  Subject to exceptions in certain emergencies, an employer must provide 24 hours' notice in writing of an employee's shift change. 
  • Family Responsibility Leave: [Bill C-63 provided for Family Responsibility Leave, however Bill C-86 replaced it with Personal Leave—see below.]
  • New and Expanded Leaves of Absence:  New job-protected leaves of absence are added and some that already exist are expanded.  New leaves are Family Violence Leave (up to 10 days unpaid every year), and Aboriginal Practices Leave (up to five days every year after three months of continuous employment).  Bereavement Leave is made more generous in number of days and available time frame (up to five days from the date of death to six weeks after the day of the funeral, burial or memorial service, whichever is latest; if the employee has completed three consecutive months of continuous employment, the first three days are paid).
  • Vacation:  An employee's vacation may be postponed or interrupted to take a leave of absence. 

BILL C-86

STATUS:  Partially proclaimed in force September 1, 2019—balance pending

As CLC amendments in Bill C-63 will come into force on September 1, 2019, related amendments in Bill C-86 will come into force on the same date.  These amendments include:

  • 96 Hours' Notice of Work Schedule:  Employees must be provided 96 hours' written notice of their work schedule before the start of the employee's first work period or shift under that schedule, subject to exceptions for emergencies and, for unionized employees, subject to applicable terms in a collective agreement that specify a different time frame for providing the work schedule. 
  • Breaks for Nursing or for Medical Reasons:  Employees are entitled to unpaid breaks for nursing, to express breast milk, or for medical reasons.
  • Breaks for Every 5 Hours of Work:  Employees are entitled to unpaid breaks of 30 minutes for every five consecutive hours of work.  However, these breaks must be paid if the employee must be at the employer's disposal during the break.  Breaks may be postponed or cancelled in an emergency. 
  • Rest Periods:  Rest periods of at least eight hours are required between work periods/shifts and may be postponed or cancelled in an emergency. 
  • Vacation Entitlement:  Minimum vacation of three weeks (and 6% vacation pay) is required after five years of employment (previously after six), and minimum vacation of four weeks (and 8% vacation pay) is now required after 10 years of employment.
  • Minimum Length of Service Requirement:  The minimum length of service requirement will be eliminated for maternity leave, parental leave, leave related to the death or disappearance of a child, and holiday pay. 
  • Court or Jury Duty Leave:  A new unpaid court or jury duty leave will be available to attend court as a witness or a juror, or to participate in jury selection.  The duration of the leave is indefinite.  
  • Medical Leave:  A medical leave of up to 17 weeks replaces sick leave.  Although the maximum duration of the leave remains the same, the circumstances in which it is available are wider ranging.  Anti-reprisal provisions apply.
  • Personal Leave:  Every employee is entitled to a personal leave of up to five days in each year for treating their illness or injury; carrying out responsibilities related to the health or care of any of their family members; carrying out responsibilities related to the education of any of their family members who are under 18 years of age; addressing any urgent matter concerning themselves or their family members; attending their citizenship ceremony; and for any other reason prescribed by regulation.  If the employee has completed three consecutive months of continuous employment, the first three days are paid.
  • Continuity of Employment:  Continuity of employment occurs when a work, undertaking or business becomes federally regulated or in cases of contract re-tendering.

Set out below are key Bill C-86 amendments to the CLC that will become effective on a day to be fixed by order of the Governor-in-Council:

  • Group Terminations: The current 16-week notice to the Minister of a group termination (i.e., a termination of 50 or more employees from a single industrial establishment within a four-week period) will be supplemented with a requirement to also provide individual notice at least eight weeks in advance to all "redundant employees," pay in lieu of notice, or a combination of the two. (The effective date of this amendment may not be before September 1, 2019.)
  • Individual Terminations: The current two-week notice period in an individual termination will be replaced by a graduated notice scheme that will depend on the number of years of continuous employment.  After three consecutive months of continuous employment, the employee will be entitled to written notice of between two and eight weeks, pay in lieu of notice, or a combination of the two. 
  • Temporary Help Agencies: Employers that use temporary help agencies will be required to provide equal pay to agency employees who perform substantially the same work as an employee of the employer.  A temporary help agency will be prohibited from preventing its employees from establishing an employment relationship with an organization that is a client of the agency.  Agency employees will have a right to request a review of their wages. 
  • Equal Pay for Equal Work:  Part-time, casual, contract or seasonal employees may not be paid less than what is paid to full-time employees who perform the same job, unless a justifiable exception such as seniority or merit applies.  Part-time, casual, contract or seasonal employees will have a right to request a review of their wages.
  • Burden of Proof in Misclassifications:  When an employee makes a complaint that Part III of the CLC (standards, hours, wages, vacations and holidays) has been breached, and the employer alleges the complainant is not an employee, the employer will have the burden of proof. 
  • Minimum Age of Employment: The minimum age of employment will be increased from age 17 to age 18.

Part 2 – Amendments to Part II of the CLC (Occupational Health and Safety)

BILL C-65

STATUS: Not yet proclaimed in force

Bill C-65 is not yet in force, and will come into force on proclamation.  The federal government issued a press release on April 26, 2019, stating that these new workplace violence and harassment obligations will come into force in 2020. 

Bill C-65 defines "harassment and violence" as:

...any action, conduct or comment, including of a sexual nature, that can reasonably be expected to cause offence, humiliation or other physical or psychological injury or illness to an employee, including any prescribed action, conduct or comment.

When it becomes law, Bill C-65 will require federally regulated employers to make substantial changes to how they address workplace violence and harassment.  Among other things, the Bill will require employers to conduct a workplace assessment to identify risks of harassment and violence, to implement preventive measures to protect against these risks, and to prepare workplace harassment and violence policies that designate a person to receive complaints.  Mandatory prevention training will be required for all employees, including those who have supervisory or managerial responsibilities.  Employers will be responsible for investigating, recording, reporting, and responding to occurrences of harassment and violence, and for providing support to affected employees.  Harassment and violence obligations will apply to former employees if the occurrence becomes known to the employer within three months after the former employee ceases to be employed. 

On April 27, 2019, the federal government published draft Work Place Harassment and Violence Prevention Regulations that will apply to all federally regulated workplaces under Part II of the CLC.  Comments were requested within 30 days of publication. The main elements of the draft Regulations include a requirement that employers develop a workplace harassment and violence prevention policy, conduct a workplace assessment, implement preventive measures and emergency procedures, identify, develop and deliver harassment training, make available information regarding support measures, keep records of occurrences, and report aggregated data on occurrences resolved through early resolution and conciliation to internal committees or representatives.  Finally, the draft Regulations outline a resolution process. 

Part 3:  Expert Panel Will Recommend Even More CLC Amendments

In a February 2019 press release, the federal government announced that its work to modernize the CLC will continue. An independent Expert Panel has been established to make additional recommendations, expected this summer, with regard to the following issues highlighted in the consultations: federal minimum wage; labour standards protections for non-standard workers; the "right to disconnect" outside of work hours; collective voice for non-unionized workers; and, access and portability of benefits.

Bottom Line for Employers

Evidently, the federal government's strategy is to modernize the CLC through a patchwork of amendments that are being phased in incrementally.  As a result, federally regulated employers are encouraged to become familiar with the amendments and to closely monitor the "in force" dates to ensure compliance.  Employers are also encouraged to become familiar with additional amendment recommendations the Independent Panel is expected to announce.  In fact, where possible and appropriate, employers are advised to implement a strategy of "compliance in advance" to avoid a last-minute scramble.

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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