This fall, we have seen a plethora of government announcements and court decisions in the employment law sphere, many of which will undoubtedly impact employers and employees across Ontario well into the New Year. As we close out 2021, we’ve compiled a list of some of the most recent and most significant employment law developments below for your reference.
1. Ontario Passes the Working for Workers Act, 2021 (the “Act”). The Act, originally introduced on October 25, 2021, received Royal Assent on December 2, 2021. It makes several notable changes to Ontario’s Employment Standards Act, 2000 (the “ESA”), including imposing a ban on employers entering into an employment contract or other agreement with an employee that is, or includes, a non-competition agreement. The Act does contemplate two limited exceptions to the non-competition ban, namely: (i) in circumstances where there is a sale of a business and, as a part of the sale, the purchaser and seller enter into a non-competition agreement and the seller becomes an employee of the purchaser immediately after the sale; and (ii) in relation to executive level employees. An “executive” is narrowly defined in the Act as “any person who holds the office of chief executive officer, president, chief administrative officer, chief operating officer, chief financial officer, chief information officer, chief legal officer, chief human resources officer or chief corporate development officer, or holds any other chief executive position.”
The Act also introduced a new policy requirement for employers that employ at least twenty-five (25) workers on January 1 of any year. Specifically, these employers will now have to implement a written policy on disconnecting from work that includes the date the policy was prepared and the date any changes were made to the policy. While the Act does not dictate the substantive content of the disconnecting from work policy, it is possible that specific policy requirements may ultimately be set out in regulations to the ESA in the coming months. Employers with at least twenty-five (25) employees have until June 2, 2022, to prepare the initial version of the policy, and must provide a copy of the policy to each employee within thirty (30) days of completing the policy or making any changes to the policy, once implemented. It must also be provided to new hires within thirty (30) days of their start date.
2. Federal Government Implements Mandatory COVID-19 Vaccine Policy for Public Service Employees. On October 6, 2021, the Treasury Board released its previously announced Policy on COVID-19 Vaccination for the Core Public Administration Including the Royal Canadian Mounted Police. The policy required public servants in the core public administration to attest to their vaccination status by October 29, 2021. Those who did not disclose their status or who were not fully vaccinated could be placed on a leave without pay as early as November 15, 2021, unless they were unable to be vaccinated for reasons related to a prohibited ground as defined under the Canadian Human Rights Act. The federal government also introduced similar requirements for employees in the federally regulated transportation sector, and recently announced an intention to introduce regulations under the Canada Labour Code which would make vaccination mandatory in all federally regulated workplaces, starting sometime in early 2022.
3. Guidance Released on ROE Codes for Employees who Refuse to Comply with Mandatory Vaccination Policies. Employment and Social Development Canada (“ESDC”) recently issued new guidance for employers on coding of Records of Employment (“ROE”) for employees whose employment ends after failing to comply with a mandatory vaccination policy in the workplace. Per ESDC, if an employee fails to report to work because they refuse to comply with the employer’s mandatory COVID-19 vaccination policy, employers should use code E (quit) or code N (leave of absence). Additionally, when an employer suspends or terminates an employee for not complying with its mandatory COVID-19 vaccination policy, the guidance confirms that employers should use code M (Dismissal or Suspension).
What’s particularly interesting about the guidance is it indicates that employees who refuse to comply with their employer’s mandatory vaccination policy may not be eligible for employment insurance benefits, though the guidance does note that ESDC may contact the employer to request additional information about how the policy was adopted and communicated to employees, whether employees were notified that failure to comply would result in loss of employment, whether the policy’s application was reasonable in the circumstances, and whether there were any exceptions to the policy’s application.
4. Ontario Extends the “COVID-19 Period” for Infectious Disease Emergency Leave to July 30, 2022. On December 7, 2021, the provincial government announced that it would be extending the “COVID-19 period” for the purposes of the infectious disease emergency leave provisions of the ESA to July 30, 2022. With this latest extension of the COVID-19 period to July 30, 2022, provincially regulated employers can continue to unilaterally place their employees on unpaid leave (or reduce their hours of work or pay), so long as it is for reasons related to COVID-19, without having to provide them with their minimum termination and severance entitlements pursuant to the ESA until at least July 31, 2022. For more on this, please refer to our previous blog post on Infectious Disease Emergency Leave. The government also extended its paid COVID-19 sick days program until July 31, 2022. As part of this program, employees can receive up to three days of paid leave for reasons related to COVID-19, including if they need to get tested, vaccinated, self-isolate, or care for a family member.
5. Another Appeal Decision Confirms an Illegal “Just Cause” Termination Provision Voids Entire Termination Clause. In Lamontagne v. J.L. Richards & Associates Limited, 2021 ONSC 8049, the Divisional Court upheld the Superior Court’s finding that the “just cause” termination provision in the employment agreement at issue was an illegal attempt to contract out of the employee’s minimum entitlements pursuant to the ESA and, as such, rendered the entire termination clause void. The “for cause” termination clause at issue stated that: “Employment may be terminated for cause at any time, without notice.” In its decision confirming that the clause was unenforceable, the Divisional Court noted that a reasonable interpretation of the language in the clause was that the employee did not have a right to payment in lieu of notice if dismissed for cause – even if the employee’s conduct did not constitute wilful misconduct under the ESA, which is the standard an employer is required to establish in order to deprive an employee of their ESA minimum entitlements. The decision serves as further confirmation that the Ontario Court of Appeal’s ruling in Waksdale v. Swegon North America Inc., 2020 ONCA 391, in which it held that if any portion of an employee’s termination provision is illegal it renders all of the termination provisions void, is here to stay.
Disclaimer: As always, this post does not constitute legal advice and we would encourage you to seek professional legal advice from one of our knowledgeable lawyers before making any decisions with respect to your own case.