(This is not legal advice and is for informational purposes only.)
After a state of emergency was declared by the Ontario government on March 17, 2020, many businesses instituted temporary layoffs. The reasons were twofold: their businesses were being forced to close, but many were also forced to reduce costs as a result of a downturn in business. In most cases, employees who were temporarily laid off were not provided a date as to when they would be recalled back to work.
Now that the province is re-opening, businesses are looking at their present and future staffing needs. Despite some financial assistance from the provincial and federal governments including wage subsidies and access to credit, many businesses will have to permanently lay off some of their employees.
So what does this mean for the workers who will not be recalled? Do they have any recourse?
For provincially regulated workers subject to the Employment Standards Act, 2000 (“ESA”), a temporary layoff can generally last for up to 13 weeks in any period of 20 consecutive weeks. This layoff period can be extended for up to 35 weeks in a 52-week period if during the temporary layoff period, the employer makes substantial payments to the employee, continues group benefits coverage, continues to pay into the employee’s pension plan or provides supplemental EI benefits. Should the temporary layoff period last beyond 13 weeks (or 35 weeks as applicable), the employee is deemed dismissed and the employer is automatically required to provide a severance page.
As a result of pandemic, the Province recently enacted a new regulation essentially placing temporary layoffs on hold for up to six weeks after the day that the Province’s emergency order is lifted. Employees on layoff or reduced hours or pay due to COVID-19 are deemed to be on an infection disease emergency leave. This has the practical effect of extending the length of time employees are on temporary layoff. These temporary rules apply retroactively to March 1, 2020. The new regulation is meant to ensure that businesses are not forced to terminate employees if they are unable to recall workers back to work right away.
Non-unionized employees who are on temporary layoff due to COVID-19 are now automatically deemed to be on an unpaid “infectious disease emergency leave”. This is a job-protected leave, meaning that the employer is obligated to reinstate the employee to their position if the job still exists, or to a comparable one if it no longer exists.
If the temporary layoff becomes permanent, the employer has a legal obligation to provide the employee with advance notice of termination or payment in lieu (a severance package). The amount of notice or severance entitlement can be significant, depending on the employee’s age, position, length of service, their contract of employment, and the availability of comparable jobs in the market place.
If you have been temporarily laid off and are concerned you may not be recalled back to work, speak to an employment lawyer about your legal rights.