Northern Exposure

Ontario labor and employment laws to undergo significant amendments

by Sophie Arseneault and Christian Paquette

In Canada’s most populous province, labor and employment matters are governed by two fundamental statutes: the Employment Standards Act (ESA) and the Ontario Labour Relations Act (LRA). The ESA sets out minimum rights and obligations of employers and employees in the province. The LRA governs a host of matters regarding labor relations from certification and collective bargaining to unfair labor practices and decertification.

After nearly two years of public consultations and thorough reflection as to how to update this legislation in the face of changing workplaces, the Ontario government received 173 recommendations on May 23 from the two special advisors it had appointed to the task.

The Ontario government’s reaction was swift: It immediately announced its intention to make important legislative changes as a result of these recommendations. On June 1, the government introduced a bill before the Legislative Assembly – The Fair Workplaces, Better Jobs Act, 2017 – with the aim of amending the ESA and the LRA to “create more opportunity and security” for workers.

The most significant of those anticipated legislative changes are outlined below.

Proposed changes to employment standards

  • Increased minimum wage: With few exceptions, the minimum wage will be raised to $14 an hour as of 2018, and to $15 an hour as of 2019, making Ontario the most generous province in that regard alongside Alberta. Wages would continue to increase with inflation otherwise.
  • Equal pay for equal work for casual, part-time, temporary and seasonal employees: These changes aim to ensure not only that these employees receive the same salary as their full-time coworkers, but that they also be able to ascertain this by requesting a review of their salary if they believe they don’t, without fear of reprisal.

Temporary Help Agency (THA) employees would be entitled to both the same wages as their permanent counterparts and to notice of termination (or pay in lieu) of one week if their assignment is scheduled last more than three months.

These changes will no doubt have a profound impact for employers as well as temporary help agencies and those employers using them. The changes would come into force on April 1, 2018.

  • Scheduling rights: Employees would be entitled to request schedule or location changes after three months of service. Employers are not required to accept. The amendment aims to protect employees making such requests against reprisals.

Employees will have the right to refuse shift work or “on call” work presented to them with less than 96 hours of notice.

Employees with shifts canceled in less than 48 hours or employees reporting to work only to work less than three hours (where they normally work more than that) will be entitled to three hours of pay.

“On call” employees who are ultimately not called into work would also be entitled to three hours of pay per 24-hour period.

The changes aim to foster more predictability for employees. An employer receiving such a request must discuss it with the employee and notify the employee of its decision within a reasonable time period. An employer denying the request must provide its reasons for the denial to the employee. It is unclear how many requests employees can make.

  • Overtime: For those employees holding several positions, the rate of pay used to calculate the overtime pay will be that of the actual position performed. Blended overtime rates will be eliminated which, while simplifying administration, may increase labor costs for some employers.
  • Employee misclassification as contractors: Employers faced with a dispute on the classification of a contractor will have the burden of proving the individual is not an employee. Employers who fail to do so could now be faced with prosecution, public disclosure of a conviction and fines.

The legislative amendments, slated to come into force on January 1, 2018, will no doubt cause employers to think carefully before engaging contractors.

  • Facilitate joint liability of related businesses: As of January 1, 2018, it will be easier to take action against a related business for the ESA violation of another business. The current criteria of “intent or effect” of defeating the ESA will be eliminated, making it easier to collect monies from third-party related businesses.
  • Increased paid vacation: Come January 1, 2018, Ontario will join those very few Canadian jurisdictions that offer more generous vacation entitlements: Employees will be entitled to three weeks of paid vacation after five years of service.
  • Paid emergency leave: All employers will be required to grant 10 days of personal emergency leave days to employees, regardless of the size of their workforces. Significantly, two of these personal emergency days must now be paid and employers will no longer be allowed to request sick notes from qualified health practitioners but can still require employees to provide “reasonable evidence.” This change would be effective on January 1, 2018. Interestingly, the report had only recommended that doctor’s notes be paid by employers.
  • Extended family medical leaves: The leave, used to provide support or care to dying family members, would be increased to 27 weeks in a 52-week period as of January 1, 2018.
  • Electronic agreements: A welcome change for employers, the ESA will now make it clear that “agreements” between employers and employees can be made electronically as of January 1, 2019, by email for instance, including with respect to work hours and overtime.
  • Focus on Enforcement: Various measures are anticipated in connection with the enforcement of the legislation. Notably, the Ministry of Labour (MOL) noted that penalties for noncompliance would increase from $250, $500, and $1,000 to $350, $700, and $1,500. These amounts will be determined by regulation. Wage collection, whether by the government or an authorized collector, will also be facilitated through various means as of January 1, 2018.

Beyond these legislative amendments, the government has also signaled its intention to invest heavily in enforcement of the ESA by hiring up to 175 ESA officers who are responsible, notably, for conducting workplace audits and investigating complaints.

The MOL has also announced its intention, as part of this overhaul, to conduct a more fulsome review of various ESA exemptions and special industry rules as early as this fall. This review would include exemptions in place for managers and supervisors.

Proposed changes to the Labor Relations Act

  • Return to card-based union certification model: Certification will now be card-based in specific industries: the temporary help agency industry, the building services sector, and home care and community services industry.

As noted by the special advisors, card-based certification outcomes are dramatically better for unions, and these changes will presumably have a significant impact in these workplaces.

  • Facilitating automatic certification: Unions can now be more easily certified when an employer violates the LRA.
  • First contract arbitration: The amendments aim to make first contract arbitration more accessible, along with mediation.
  • Secret ballot voting: Votes outside the workplace will now be permissible, including by telephone and electronically, with the OLRB empowered to give directions regarding the voting process.
  • Access to employee lists and contact information: A union will now be able to file an application with the OLRB to have access to an employee list. If the OLRB is satisfied that the union has garnered the support of 20 percent of employees it will have a right to access employee lists. This list must include the name of each employee in the proposed bargaining unit, phone number, and personal email if it was provided to the employer.
  • Bargaining unit structure where multiple units: Similar to the federal sector and of interest to employers, the Ontario Labor Relations Board will be empowered to change the structure of bargaining units where they are no longer appropriate, and to consolidate newly certified bargaining units under a single employer after the filing of an application by employers or unions.
  • Enhanced protection regarding lawful strikes/lockouts and just cause: The current six-month limitation for a right to return to work after a legal strike or lockout would be removed.

Equally significant is the requirement for employers to prove just cause when disciplining or firing an employee from the date employees are in the position of a lawful strike/lockout until a first collective agreement is reached, as well as during the period between certification and conclusion of a first contract.

All changes to the LRA are to come into force six months after the day the Fair Workplaces, Better Jobs Act, 2017 receives Royal Assent.

What’s next?

To the surprise of many, the Ontario government swiftly introduced the bill before the Assembly breaks for the summer. The matter has also been speedily referred to the Standing Committee on Finance and Economic Affairs. This may be employers’ last opportunity to be heard about the proposed changes before they become law, given the governing party’s majority at the Legislative Assembly. Employers will therefore want to monitor this matter closely as it progresses through the committee and as matters related to exemptions under the ESA will become open to comments and discussions between the government and various stakeholders.

It will be interesting to see whether, as a result of the committee’s work other recommendations of the special advisors make their way in this bill or in future amendments to the ESA and the LRA. With the business community and labor organizations both concerned about the scope of the special advisor’s recommendations, it remains to be seen whether Ontario’s government will strike the balance it wishes to achieve in this important endeavor.

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