Termination of Ontario’s declaration of emergency: effect on temporary layoffs and deemed ‎terminations due to COVID-19‎

On July 24, 2020, the Ontario Government’s provincial declaration of emergency in response to the COVID-19 Pandemic terminated, and the Reopening Ontario (A Flexible Response to COVID-19) Act, 2020 came into force.

Under O. Reg. 228/20: Infectious Disease Emergency Leave (the “Regulation”), which was filed under the  Employment Standards Act, 2000 (the “ESA”) on May 29, 2020, the termination of the provincial declaration of emergency on July 24, 2020 means that important temporary changes to the ESA under the Regulation will end after September 4, 2020.

The Regulation amends the provisions of the ESA that relate to Infectious Disease Emergency Leave, temporary layoffs and deemed terminations of non-unionized employees in order to provide employers with temporary relief from the notice of termination and severance pay provisions of the ESA during the “COVID-19 Period”.

The COVID-19 Period is defined as starting March 1, 2020 and ending six (6) weeks after the day on which the provincial declaration of emergency terminates. Accordingly, the following changes under the Regulation will end after September 4, 2020:

1.‎ Temporary layoffs deemed to be Infectious Disease Emergency Leave

The Infectious Disease Emergency Leave was added to the ESA on March 19, 2020 to provide unpaid, job-protected leave for employees who are not performing the duties of their position because of prescribed reasons related to COVID-19. Under the Regulation, employees whose hours of work have been temporarily reduced or eliminated during the COVID-19 Period as a result of COVID-19 are deemed to be on an Infectious Disease Emergency Leave and not a temporary layoff under the ESA.

After September 4, 2020 when the COVID-19 Period ends, these employees will no longer be deemed to be on an Infectious Disease Emergency Leave and will be considered temporarily laid off under the ESA if their hours of work continue to be temporarily reduced or eliminated. Subject to certain exceptions, a temporary layoff can last no more than thirteen (13) weeks in any period of twenty (20) consecutive weeks, after which the temporary layoff will be deemed a termination of employment. The employer will then be subject to the notice of termination and severance pay provisions of the ESA.

Employees who are terminated or laid off during the COVID-19 Period because of the permanent discontinuance of all of the employer’s business at an establishment are not deemed to be on an Infectious Disease Emergency Leave, and will remain entitled to notice of termination and severance pay, as applicable.

2.‎ Reduction or elimination in hours and/or reduction in wages not considered constructive ‎dismissal

Constructive dismissal occurs when an employer unilaterally imposes significant adverse changes to the terms and conditions of employment, such as a significant reduction in hours or wages. Under the Regulation, (a) a temporary reduction or elimination of an employee’s hours of work or (b) a temporary reduction in wages due to COVID-19 will not constitute constructive dismissal under the ESA if the temporary reduction or elimination occurred during the COVID-19 Period.

With the termination of the provincial declaration of emergency on July 24, 2020, employees who experience a temporary reduction or elimination of their hours of work or a temporary reduction in wages due to COVID-19 after September 4, 2020 will be entitled to claim constructive dismissal under the ESA. ‎

3.‎ Ministry of Labour complaints deemed not filed

Under the Regulation, a complaint filed with the Ministry of Labour alleging that a:

(a) temporary reduction ‎or elimination of an employee’s hours of work by the employer, or

(b) temporary reduction in an ‎employee’s wages by the employer

constitutes the termination or severance of an employee's ‎employment is deemed not to have been filed if the reduction or elimination occurred during the COVID-‎‎19 Period for reasons related to COVID-19.‎

Employees who experience a temporary reduction or elimination of their hours of work or temporary ‎reduction in wages due to COVID-19 after September 4, 2020 will be able to file a complaint with the ‎Ministry of Labour alleging that the temporary reduction or elimination constitutes the termination or ‎severance of their employment. ‎

Conclusion

The termination of the provincial declaration of emergency creates significant considerations for ‎employers who temporarily reduced or eliminated employees’ hours of work or temporarily reduced ‎employees’ wages during the COVID-19 Period in response to the COVID-19 Pandemic. For further ‎information on this Regulation and how it may impact your workplace, we encourage you to reach out to ‎any member of the Toronto Labour and Employment Team.‎

We will continue to monitor and provide updates as soon as they become available. The COVID-19 situation is rapidly evolving with new measures being adopted ‎or modified at both ‎the ‎federal and provincial level. For further information, please consult our ‎Coronavirus Resource ‎Centre.

This article provides only general information about legal issues and developments, and is not intended to provide specific legal advice. Please see our disclaimer for more details. ‎