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Ontario Makes Temporary Changes to Layoff Rules During Pandemic

The COVID-19 crisis has forced many businesses to shut their doors; and many others have seen sharp reductions in their revenue. This in turn has triggered widespread layoffs as well as reductions in work hours.

In order to avoid triggering terminations and to help businesses stay afloat and keep them out of insolvency, the Ontario Government has implemented temporary changes to the labour laws.

What the changes mean for employers and employees

The changes will mean that terminations of non-unionized workers will not be triggered after a 13-week layoff or reduction in hours and that employers will not have to make severance payments as a result.

Instead, employees may be placed on a temporary leave and they will still be able to collect emergency government assistance. These amendments to the labour laws will expire six weeks after Ontario’s state of emergency ends at which time, employers will either need to bring their employees back to work or pay them severance.

The purpose of these changes is to help as many businesses as possible avoid bankruptcy and to preserve as many jobs as possible.

The amendments will be retroactive to March 1, 2020 and will not apply to unionized environments where workers are covered by collective agreements.

In a statement to the press, Labour Minister Monte McNaughton said “We’ve heard loud and clear from employers that they don’t want to be forced to terminate their employees. We have to step in to make sure workers have jobs to return to.”

The current state of unemployment in Ontario

It is estimated that so far during the shutdown 1.1 million workers in the province have lost their jobs and that another 1.1 million workers have had their hours sharply reduced.

According to Statistics Canada, in April alone, the Province’s job numbers plummeted by 689,200 which has brought employment numbers to their lowest point since 2009 and the unemployment rate to 11.3% – the highest it has been since 1993.[i]

The new measures were called for by a number of business advocacy groups including the Ontario Chamber of Commerce and the Canadian Federation of Independent Business who feared that once terminations were triggered, there would be widespread bankruptcies as many small and medium sized businesses would be unable to make the severance payments.

Previous employment measures taken during the COVID-19 pandemic

In March, Premier Doug Ford announced that employees should not lose their jobs if they have to quarantine or self-isolate and employers were banned from requiring a doctor’s note from those who were self-isolating. The ban also protected those who were caring for a sick spouse or for children who were home from school. These measures are retroactive to January 25.

Minken Employment Lawyers is your source for expert advice and advocacy on today’s employment law issues. If you have any questions on COVID-19 and your workplace or are planning on reopening and bringing your employees back to work, please contact us today at contact@minken.com or call us at 905-477-7011. Sign up for our newsletter to receive up-to-date COVID-19 information , including new legislation and Court decisions impacting your workplace.

Please note that this article is for informational purposes only and does not constitute legal advice.

[i] https://toronto.ctvnews.ca/ontario-makes-temporary-change-to-layoff-regulations-to-help-businesses-amid-pandemic-1.4963066

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