O.REG 228/20 UNDER THE EMPLOYMENT STANDARDS ACT, 2000
STATUTORY LAYOFFS AND CONSTRUCTIVE DISMISSAL DURING COVID-19
By Leanne Standryk
Since the beginning of March 2020 and increasingly so after Ontario Premier Doug Ford declared a state of emergency under the Emergency Management and Civil Protection Act on March 17, 2020 our labour and employment department has been focused on advising clients on all things Covid-19 related to the workplace. A topic du jour, managing temporary lay-offs and avoiding potential claims of constructive dismissal.
On May 29, 2020 the Ontario Government quietly introduced O.Reg. 228/20: Infectious Disease Emergency Leave under the Employment Standards Act 2000 (the “ESA”) which replaces an earlier Regulation 66/20. The Regulation introduces temporary amendments to the layoff provisions of the ESA to permit workplaces to respond to the continued impact of COVID-19.
Deemed Emergency Leave.
The new Regulation applies retroactively to deem employees whose hours of work have been temporary reduced or eliminated due to COVID-19 on or after March 1, 2020 to be on a “infections disease emergency leave” (“IDEL”).
The IDEL was introduced to the ESA previously under O.Reg 66/20 and is considered a statutory protected leave with the same protections traditionally available to employees on other job protected leaves contemplated by the ESA, including the right of reinstatement. The exception however under the IDEL is that employers are exempt from the customary requirement to continue contributions to benefit plans while the employee is leave provided that the employer was not making plan contributions prior to May 29, 2020 for the employee while on a COVID-18 related lay-off.
Constructive Dismissal
Reg.228/20 also introduced an amendment to the termination provisions of the ESA in that the reduction of employee hours or wages due to COVID-19 does not constitute a constructive dismissal for the purposes of the ESA even if the reduction exceeds the period contemplated by the temporary lay-off provisions of the ESA.
The Regulation goes on to proscribe that any complaint filed with the Ministry alleging constructive dismissal due to a reduction or elimination of hours or wages due to COVID-19 is deemed not to have been filed. This particular provision however is not retroactive to May 29, 2020. Therefore, any layoff that exceeds the statutory minimum period or reduction of wages that occurred prior to May 29, 2020 may be treated as a constructive dismissal for the purposes of the ESA.
What is important for employers to understand is that these provisions apply specifically to the statutory scheme and arguably do not amend the current principles at common law. Therefore while O.Reg.228/20 provides employers with limited protections from complaints under the statutory ESA regime, any lay-off, reduction in hours or wages not otherwise expressly permitted by contract or past practice may still result in employer liability for constructive dismissal at common law.
We remain committed to supporting our clients with timely communication of details as they become known. We are available to answer your questions and provide assistance specific to your workplace. Please contact us at 905-641-1551.