A number of changes to the Canada Labour Code (the "Code") and its regulations have recently come into effect or will be coming into effect over the next year. Many of these changes have been set for a long period of time, having been initiated primarily through the Budget Implementation Act 2018, No. 2.
We have provided below a summary of key, recent and pending changes to the legislation, along with action items to be considered for those federally regulated employers impacted by the updates.
Reimbursement of Reasonable Work-Related Expenses - Summary of Updates:
Section 238.1 of the Canada Labour Code (the "Code") and its related provisions at Section 23.1 of the Canada Labour Standards Regulations (the "Regulations") have been amended to require employers to provide reimbursement for reasonable work-related expenses incurred on or after July 9, 2023. The accompanying Interpretations, Policies and Guidelines (the "IPG") provides guidance on these requirements.
The IPG states that to be eligible for reimbursement by the employer, an expense must meet the following four (4) criteria:
- The employee does not have to pay the expense as per a written agreement or collective agreement (for example, a cost for which the employee is responsible, such as the cost of a lost uniform);
- The employee must have paid the expense out-of-pocket (payment with an employer allowance, cash advance, or employer credit or purchasing card, for example, would not be considered "out-of-pocket");
- The expense must be work-related; and
- The expense must be reasonable.
The IPG states that the above factors must be assessed as a whole (to the extent relevant) and weighed on the specific facts. The IPG also provides further guidance regarding the assessment of whether an expense is work-related or reasonable.
As further detailed in, below, the Code now requires employers to provide their employees with a written employment statement with information concerning their employment. This statement should include, among other things, information about how the employee can claim reimbursement of reasonable work-related expenses.
Timing of Repayment
For unionized and non-unionized employees, eligible expenses must be reimbursed as specified in a collective agreement or written agreement (if and as applicable), or, if there is no such collective agreement or written agreement, within 30 days after the employee submits their expense claim to the employer.
Federally regulated employers should review their expense reimbursement policies and practices, and any other relevant documentation provided to employees on hire (e.g. employment and collective bargaining agreements) to confirm whether they comply with the above-noted Code-amendments. If not, this documentation should be updated to ensure compliance with the new provisions.
Provision of Information Related to Employment and Termination of Employment - Summary of Updates:
Section 253.1 of the Code now requires that an employer provide its employees with a copy of materials made available by the Minister of Labour (the "Minister") containing information respecting employers' and employees' rights under the Code. If these materials are updated, the employee must be provided with an updated copy of the materials within 30 days. These materials must also be posted in the workplace, in a readily accessible place where they are likely to be seen by employees.
For existing employees, the Minister's materials must be provided 90 days from the later of (i) July 9, 2023 (i.e. October 7, 2023), and (ii) the date the materials are published by the Minister.
Terminated employees must also be provided, not later than their last day of employment, with a copy of the Minister's most recent materials relating to terminations of employment.
No action needs to be taken at this time, as the relevant materials have not yet been published by the Minister. We are continuing to monitor for the release of same and will post any updates on this blog.
Provision of Employment Statement - Summary of Updates:
Section 253.2 of the Code now requires an employer to provide to their employees, within the first 30 days of employment, a written statement containing information relating to their employment. In accordance with the Regulations, the written statement must include the following information in respect of the individual employee:
- Names of the parties to the employment relationship;
- Job title and a brief description of duties and responsibilities;
- Address of the employee's ordinary place of work;
- Date on which the employment commences;
- Term of the employment;
- Duration of the probationary period, if any;
- Description of the necessary qualifications for the position;
- Description of any required training for the position;
- Hours of work for the employee, including information on the calculation of those hours and rules regarding overtime hours;
- Rate of wages or salary and the rate of overtime pay;
- Frequency of pay days and the frequency of payment of any other remuneration;
- Any mandatory deductions from wages; and
- Information about how the employee can claim reimbursement of reasonable work-related expenses.
While a template employment statement is available here, the federal Labour Standards Program website states that employers are not required to use this template and can provide the above information through other documents, or a combination of documents (for example, a written employment agreement or offer letter, policy manual, or collective agreement).
The written statement must be updated within 30 days of any change being made to the information contained therein. The employer is required to retain a copy of the written statement for 36 months following the employee's termination from employment and has a duty to provide the employee with a copy of such statement on request.
For existing employees, the written employment statement must be provided within 90 days of July 9, 2023 (i.e. by October 7, 2023).
Federally regulated employers should review the employment documentation that is provided to employees during the onboarding process and on-hire, to ensure that it includes the information set out above. Going forward, federally regulated employers should ensure that the employment documentation provided on commencement of employment to new hires includes the required information. We would be pleased to assist in determining whether the employment documentation currently in use is sufficient for these purposes.
Termination of Employment – Individual Termination Summary of Updates:
The current termination of employment provisions of the Code, which provide for two (2) weeks' notice of termination, will be replaced effective February 1, 2024, with a graduated notice system similar to the scheme found in most provincial employment standards legislation.
The new provisions will be set out in a new Section 230(1.1) of the Code, further to which employees will be entitled to the following notice of termination, pay in lieu of notice, or some combination thereof, as follows:
(and/or Payment in Lieu)
Completed Period of Continuous Employment
In addition to the above, an employee will remain entitled to statutory severance pay pursuant to the Code, if they have completed at least 12 consecutive months of continuous employment before their termination of employment. For eligible employees, severance pay under the Code is equal to two (2) days' regular wages for each full year that an employee has worked prior to their termination of employment, with a minimum payment equal to five (5) days' wages.
Statement of Benefits
Effective February 1st, 2024, employers will also be required to provide employees with a statement of benefits, similar to what is currently required in the group termination context, at the time of termination of employment, that includes the terminated employees':
- vacation benefits;
- severance pay, and
- any other benefits and pay arising from their employment.
The above statement will be required to be given in accordance with the following timing requirements:
- For an employee who receives written notice of termination, as soon as possible, but not later than two (2) weeks before the date of the termination of their employment;
- For an employee who receives payment in lieu of notice, not later than the date of the termination of their employment; and
- For an employee who receives a combination of notice and payment in lieu of notice, as soon as possible, but not later than two (2) weeks before the date of the termination of their employment unless the period of notice is shorter, in which case, the day on which notice is given to the employee of the date of the termination of their employment.
We recommend that federally regulated employers seek the assistance of legal counsel in reviewing their template employment agreements prior to February 1, 2024, to ensure that they are consistent with the new individual notice of termination provisions in the Code. If not, such agreements can be updated with legal assistance.
Provision of Menstrual Products - Summary of Updates:
Effective December 15, 2023, pursuant to the Regulations Amending Certain Regulations Made Under the Canada Labour Code (Menstrual Products): SOR/2023-78, several provisions of the Code's occupational health and safety regulations will be amended to require employers to provide, at no cost, menstrual products, including clean and hygienic tampons and menstrual pads in each toilet room in the workplace, along with a covered container for disposal of such products. Where the foregoing is not feasible, the employer will be required to provide the menstrual products in another location in the same workplace that is controlled by the employer and is accessible by employees at all times, and which offers a reasonable amount of privacy.
The Minister has indicated via press release that guidance materials regarding these provisions will be developed in consultation with employers and made available online prior to December 15, 2023; such materials have not yet been released.
Federally regulated employers should ensure that menstrual products as outlined above, and appropriate containers for disposal, are made available in the workplace at no cost to employees by December 15, 2023. We will continue to monitor for the release of the Minister's guidance.
Expanded Hours of Work Exemptions - Summary of Updates:
New exemptions from and modifications to the Code's Hours of Work Provisions Regulations will come into effect in 2024. These amendments are aimed at ensuring that sectors with continuous operations or unique scheduling practices are provided with flexibility in scheduling. As such, only certain classes of employees who are employed in the banking, telecommunications and broadcasting, rail transportation, and air transportation sectors will be impacted by these changes (exemptions already apply to the road transportation, postal/courier, marine, and grain sectors). The new exemptions relate to the provisions requiring 96 hours' notice of work schedules, 24 hours' notice of shift schedules, 30-minute breaks every five (5) hours of work, and eight (8) hour rest periods between a work period or shift, and are specific to each class of affected employee and sector.
These amendments will come into force on January 4, 2024 (with respect to the rail transportation, banking, and telecommunications sectors) and June 4, 2024 (with respect to the air transportation sector).
As the above exemptions to the Hours of Work Provisions Regulations are specific to the impacted class of employee and relevant sectors, employers in these sectors would be advised to consult with legal counsel to determine whether any of such exemptions apply to their employees.
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.