Ontario Terminated the COVID-19 Declared Emergency and it will have catastrophic effects on CERB layoffs due to the Waksdale decision starting September 4th

Editors Note: On September 3rd the Ontario government issued a press release changing the date and extending the suspension until January 2021. 

Ontario’s Reopening Ontario (A Flexible Response to COVID-19) Act, 2020 (the “Act”) came into effect on July 24, 2020 and the Declared Emergency ended on the same day.

The new regulation under the Employment Standards Act, 2000 (ESA) deemed an employee to be on a job-protected Infectious Disease Emergency Leave when the employer has temporarily reduced or eliminated their hours of work because of COVID-19.  The regulation affects how the termination, severance and constructive dismissal rules under the ESA apply during the COVID-19 period.  These temporary rules will expire six weeks after the Declared Emergency ended, i.e. on September 4, 2020.  They do not apply to employees represented by a trade union.”

This has set off a chain reaction for most employers and could very well trigger costly severance and termination obligations. Employers are strongly encouraged to review all  employee contracts with an experienced employment lawyer to protect the interests of all involved, there are a number of major changes employers should be aware of including the recent  Waksdale decision from  the Ontario Court of Appeal.

Although many emergency orders remain in effect, Section 17 of the Act defines a new stage in the pandemic trajectory by terminating the COVID-19 Declared Emergency in Ontario. The termination of the Declared Emergency has a direct impact on both the Declared Emergency Leave (the “DEL”) and the Infectious Disease Emergency Leave (the “IDEL”). With everything that employers need to consider for reopening regarding health and safety measures, it can be easy to ignore employment law issues until there is a problem. However, in doing so, employers leave themselves open to costly lawsuits and reputational issues.

Understanding the DEL and the IDEL

Declared Emergency Leave (the “DEL”)

The DEL entitles employees to “an unpaid, job-protected leave of absence” for various reasons during a declared emergency. Once a Declared Emergency has been terminated, employees are no longer entitled to the leave after the date that the emergency is terminated. The only exception is when an order made under s. 7.0.2 of the Emergency Management and Civil Protection Act (“EMCPA”) that applies to the employee is extended beyond the duration of the declared emergency.

When an employee can no longer rely on the DEL, the employee may still be entitled to another similar situational leave such as sick leave, family responsibility leave, family caregiver leave, family medical leave, critical illness leave, bereavement leave, or infectious disease emergency leave.

When a leave is not available to an employee to deal with a situation caused by COVID-19, employers still have a duty to accommodate. For example, an employee may have difficulties putting their kids into day-care due to their limited capacity. Employers may need to accommodate the employee’s need to take care of their children by offering alternative options.

Infectious Disease Emergency Leave (the “IDEL”)

Under this temporary rule, “a non-unionized employee whose employer has temporarily reduced or eliminated their hours of work because of COVID-19 is deemed to be on a job-protected IDEL.” The IDEL expires six weeks after the Declared Emergency ends. In this case, the six-week period will end on September 4, 2020. After the six-week period, the employee will no longer be deemed on leave. In this situation, you have three ultimate options as an employer – to call back the employee, to terminate the employee and end your relationship, or you can lay off your employee, which leaves the door open for a return to work.  Effective September 4, 2020, the temporary layoff rules start again.

As of September 4, 2020, the employer must call the employee back to work, or the employee could claim constructive dismissal unless there is a written contract or internal policies allowing temporary layoffs.

Unlike the DEL, the IDEL remains effective until September 4, 2020, six weeks after the termination of the Declared Emergency in Ontario

What this means for employers

Most businesses are entering into uncharted territory as the economy reopens. Employers are responsible for keeping up to date with legislative changes and the legal ramifications if those changes are not adhered to. Regarding employment contracts, the COVID-19-related changes, in addition to the recent game-changing Waksdale decision invalidating many termination clauses, has made well-drafted contracts a necessity. Relying on outdated, vague, and template contracts will leave many employers in a difficult situation resulting in costly termination payouts. All employers must consult an experienced employment lawyer and be prepared make immediate changes to contracts.

With the frequent changes related to COVID-19, both employers and employees need to understand their rights. If you are unsure how Ontario’s Reopening Ontario (A Flexible Response to COVID-19) Act, 2020 affects you, contact Hum Law Today.