Client Update: Proposed reform of Ontario’s labour and employment statutes

Mark Tector and Annie Gray

This morning, May 30, 2017, Ontario Premier Kathleen Wynne announced her government’s intention to introduce sweeping legislative reform of labour and employment laws.

If passed, the proposed Fair Workplaces, Better Jobs Act, 2017 would usher in a range of amendments to Ontario’s Employment Standards Act, 2000 (“ESA”) and Labour Relations Act (“LRA”).

Underlying recommendations

The proposed changes come in response to the final report of the Changing Workplaces Review, which was released on May 23, 2017 and contains a total of 173 recommendations.

First commissioned in 2015, the Review was touted as Canada’s first-ever independent review of employment standards and labour relations statutes in a single process.

The Review responds to concerns it identified in the current labour market, including precarious work, income disparity between part-time and full-time workers and the disproportionate impact of those realities on women, youths, seniors and ethnic minorities.

Proposed changes

If passed, highlights from the proposed legislation include the following:

Employment Standards

Minimum wage increase

• To $14/hour as of January 1, 2018 and $15/hour as of January 1, 2019, with annual increases thereafter at the rate of inflation (currently, the minimum wage in Ontario is $11.40/hr).

Equal pay for equal work

• Casual, part-time, temporary and seasonal employees would be paid the same wage as full-time employees when performing the same job for the same employer.
• Temporary Help Agency employees would be guaranteed pay equal to the client’s permanent employees for the same job.
• All employees would be protected from reprisal for making wage inquiries.
• Exceptions to the general rule would exist for wage differences based on systems of seniority, merit or measures of production.
• If passed, these proposals would come into effect as of April 1, 2018.

Termination of temporary assignment

• Temporary Help Agencies would be required to provide at least one week’s notice when an assignment originally scheduled to last longer than 3 months will be terminated early.
• If less than one week’s notice is provided, the employee will have to be paid the difference unless s/he is offered reasonable work of at least one week’s duration during the notice period.
• This proposal would come into force, if passed, as of January 1, 2018.

Scheduling

• Employees with more than 3 months of employment would be entitled to request scheduling or location changes with protection against reprisal.
  • If less than 4 days’ notice is given, employees can refuse to accept shifts.employees would need to be paid 3 hours at their regular wage:
  • when given less than 3 hours upon reporting to work (if the employee regularly works in excess of 3 hours per day).
  • when a shift is cancelled less than 48 hours in advance.
  • for every 24 period in which they are on-call but not called in to
    work.
• This proposal would come into effect on January 1, 2019.

Employee misclassification

• Employers who inaccurately classify employees as independent contractors would be subject to specific penalties including prosecution, public disclosure of convictions and fines.
• Where proper classification is in dispute the employer would bear the burden of proof.
• There will be no change to the ESA definition of “employee” to specifically include “dependant contractors.”

Related employer provision

• Ontario’s related employer provision would no longer require that the “intent or effect” of the business arrangement be to defeat the purpose of the ESA.

Vacation and holiday pay

• Employees with more than 5 years of employment with the same employer would be entitled to 3 weeks of paid vacation (currently, it is 2 weeks with no increase over time).
• The formula for calculating holiday pay would be simplified.
• Both these changes would take effect as of January 1, 2018.

Paid leaves

• There would no longer be a 50 employee threshold for entitlement to personal emergency leave.
• Employees would be entitled to 10 personal emergency days per year, 2 of them paid.
• There would be a new, separate leave for child death or crime-related disappearance, with a maximum duration of 104 weeks.
• Family medical leave would increase from 8 weeks in a 26-week period to 27 weeks in a 52-week period.

Enforcement

• Enforcement would be enhanced, including with an increase in administrative penalties and publication of information regarding contraventions and accompanying penalties.
• 175 more Officers would be hired by 2020-21 with the goal of having all claims resolved within 90 days.
• The province will launch an educational program regarding rights and obligations and provide compliance assistance to employers.

Certification

• Card-based certification would apply to temporary help agencies, building services and home care and community services industries.
• It would be easier for a union to be certified where employers contravene the LRA.
• There would be easier access to first contract arbitration, as well as a new mediation component.
• First contract mediation-arbitration applications would be prioritized over displacement and decertification applications.
• Unions with the support of at least 20% of employees would be provided with employee lists and contact information .
• The Board would be allowed to conduct votes outside the workplace, including with the use of technology.
• Officers would be empowered to provide directions regarding the voting process.

Other protections and procedures

• Successor rights would extend to retendering of building services contracts.
• Employers would be required to reinstate employees at the conclusion of a strike or lock out.
• Employers could not discipline or discharge employees without just cause between the time of certification and conclusion of a first contract, or the period between the date when employees are in a strike/lock-out position and the completion of a new agreement.
• Maximum fines would increase to $5,000 for individuals and $100,000 for organizations.

Statutory exemptions and special industry rules relevant to both employment standards and labour relations will be considered through consultations with stakeholders.

What this means for you

Our clients who conduct business in Ontario need to be aware of these extensive proposed changes for their own workplaces.

More broadly, however, the changes currently proposed in Ontario respond to a labour and employment landscape that is largely shared across Canada and may inform legislative changes in other provinces, including the Maritimes. Alberta has already followed in Ontario’s footsteps by announcing a similar labour and employment overhaul and it is plausible that significant revisions could follow in jurisdictions across Canada.

The foregoing is intended for general information only. If you have any questions about how this may affect your business, please contact a member of our Labour & Employment practice group.