On December 2, 2021, Bill 27, Working for Workers Act, 2021, received Royal Assent and amended the Employment Standards Act, 2000 (“ESA”) to incorporate the “right to disconnect”. The amendment does not create a legal right to disconnect. Rather, it obliges employers with twenty-five or more employees (as of January 1, 2022) to introduce a written “disconnecting from work” policy (the “Policy”) by June 2, 2022. In the amendment, disconnecting is defined as “not engaging in work-related communications, including emails, telephone calls, video calls or the sending or reviewing of other messages, so as to be free from the performance of work.”

Employer guidelines

The Ontario Ministry of Labour (the “Ministry”) published an online guide (the “Guide”) to assist employers with developing an ESA compliant policy.

The Guide clarifies two aspects of the amendment. First, employees do not have a new right to disconnect from work communications after regular hours. Rather, employers who engage employees with work communications outside of regular work hours are required to adhere to existing compensation and working time limits under the ESA. Second, the Guide clarifies that all employees are subject to the policy, including managers. Employers can implement multiple policies for different employee categories so long as all employees are covered.

The relevant amendments to the ESA are as follows:

WRITTEN POLICY ON DISCONNECTING FROM WORK

 Interpretation

 21.1.1 In this Part,

“disconnecting from work” means not engaging in work-related communications, including emails, telephone calls, video calls or the sending or reviewing of other messages, so as to be free from the performance of work.

 Written policy on disconnecting from work

 21.1.2 (1) An employer that, on January 1 of any year, employs 25 or more employees shall, before March 1 of that year, ensure it has a written policy in place for all employees with respect to disconnecting from work that includes the date the policy was prepared and the date any changes were made to the policy.

 Copy of policy

(2) An employer shall provide a copy of the written policy with respect to disconnecting from work to each of the employer’s employees within 30 days of preparing the policy or, if an existing written policy is changed, within 30 days of the changes being made.

 Same

(3) An employer shall provide a copy of the written policy with respect to disconnecting from work that applies to a new employee within 30 days of the day the employee becomes an employee of the employer.

 Prescribed information

 (4) A written policy required under subsection (1) shall contain such information as may be prescribed.

Transition

 (5) Despite subsection (1), an employer shall,

(a)  have until the date that is six months after the day the Working for Workers Act, 2021 receives Royal Assent instead of March 1 to comply with the requirements of subsection (1); and

(b)  determine whether it employs 25 employees or more as of the January 1 immediately preceding the date described in clause (a).

[….]

Transitional regulations

141 (2.0.3.5) The Lieutenant Governor in Council may make regulations providing for any transitional matter that the Lieutenant Governor in Council considers necessary or advisable in connection with the implementation of the amendments made by the Working for Workers Act, 2021. 2021, c. 35, Sched. 2, s. 33 (1).

Employers can still send communications outside regular work hours, provided they comply with existing ESA rules when assigning and remunerating employees for engaging with work communications. Accordingly, the policy must explain how time spent on after-work communications will be traced, guaranteeing weekly maximum hours of work are observed and compensation for that time is paid.

Further, nothing in the amendment prevents an employer from providing greater rights under the policy than required by the ESA. Thus, the policy can grant an employee the right not to engage with work communications even when the ESA permits it. For instance, an employer can include a provision stating that employees are not required to read emails after clocking off. In such a case, employers will be bound by the prescribed terms in their policy, not the less stringent terms of the ESA.

What to include in  disconnecting from work policies

What the policy must include:

The policy must: (1) address “disconnecting from work”; (2) set out the date that the policy was prepared; and (3) set out the date of any revisions to the policy

What the policy may include:

The policy can set out clear expectations pertaining to responding to emails, phone calls, or any other form of work communication that is outside the employee’s regular hours of work.

An adequate disconnecting from work policy might include:

• Who is covered by the policy;
• How after work communications engagement is being monitored and tracked for remuneration purposes;
• How employees will be given notice of the policy, and when reviews of the policy will be conducted;
• What hours employees may disconnect from communications;
• The circumstances employees may be required to work beyond their regular hours of work, including remaining connected, and also how they will be compensated;
• Times in which an employee should be free from work communications;
• The implementation of staggered or flexible hours of work to meet an employer’s requirements while ensuring compliance with overtime and maximum work hours under the ESA.

Employer consequences for failing to comply

At present, there is no defined penalty for an employer who contravenes their own policy. However, the Ministry’s interpretation is that only employers who provide greater rights under the policy than what the ESA provides are subject to discipline under the ESA.

With respect to the requirement to have the policy in place, like any other provision of the ESA, actual failure to produce and circulate the policy could result in the employer being ordered by the Ministry to comply within a set period of time. Employers could also be fined. In extreme cases, employers found to be in violation of the same provision numerous times could potentially face a fine of up to $100,000 for incorporated employers and $50,000 for non-incorporated employers.

Employers with 25 employees or more have until June 2, 2022 to draft and distribute a policy that complies with their obligations under the ESA, including pay for work outside of regular hours and overtime pay.  Importantly, beginning in 2023 and for every year thereafter, employers with 25 or more on January 1 of any year must have a written policy on disconnecting from work in place before March 1 of that year.

With limited guidance provided by the legislature, organizations should consider retaining experienced legal counsel to craft a policy that complies with the amendments without compromising the organization’s mandate.

On December 2, 2021, Bill 27, Working for Workers Act, 2021 (“Bill 27“) received Royal Assent. Employers must make changes to both employment agreements as well as company-wide policies. We previously outlined several changes that employers could anticipate once legislature passed Bill 27 on November 30^th. Below you will find more details on specific steps employers are required to take regarding an employee’s right to disconnect as well as changes to non-compete rules.

Employee’s right to disconnect from work

Likely the most well-publicized of the anticipated changes, Schedule 2 of Bill 27 amends the Employment Standards Act, 2000 to give employees of larger businesses the right to disconnect after hours.

Employers with 25 or more employees will be required to have a written policy with respect to disconnecting from work. The term “disconnecting from work” is defined to mean “not engaging in work-related communications, including emails, telephone calls, video calls, or the sending or reviewing of other messages, so as to be free from the performance of work.”

Next Steps: According to the transition provision of Bill 27, employers with 25 or more employees have six months after the day Bill 27 receives Royal Assent to comply with the written policy requirement. During this 6-month period, it is important for employers to update policies and communicate with employees. This will avoid workflow interruptions due to the implementation of new Disconnecting Policies.

General prohibition on non-compete agreements

Reflecting the common law position on the enforceability of non-compete restrictive covenants, Schedule 2 of Bill 27 prohibits non-compete agreements between employers and employees, with two noted exceptions. The first exception regards the sale (or a lease) of a business. Non-compete agreements between the seller and purchaser may be allowed as a part of the sale where the seller becomes an employee of the purchaser immediately thereafter. The second exception is that a non-compete agreement is not prohibited between an employer and its executives. “Executive” is defined in the Bill 27 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.”

Whether a person fits within the definition of executive is likely to become the focal point of future disputes over whether a non-compete agreement is enforceable.

Next Steps: Employers should consider the following actions:

1. Review existing employment agreements and update post-employment covenants to protect their business interests if non-compete agreements are no longer valid due to Bill 27.
2. Update job titles and job descriptions to ensure their executive positions undoubtedly meet the definition of “executive” under Bill 27.
3. Enhance internal protection for proprietary information, such as client lists, know-how, etc.
4. Prepare for any fallout related to former employees working for competitors now that they are not under the constraint of a non-compete agreement.
5. Adjust employment agreement templates accordingly for future use with special consideration for enhancing post-employment covenants for sales and other positions where a non-compete agreement is no longer allowed.
6. If an employer is paying a former employee to adhere to an existing non-compete agreement, consider negotiations with the former employee to wrap up this deal.

 

If you need guidance from an experienced employment lawyer, call today at (416)214-2329 or email info@thehumlawfirm.ca or Complete our Free Assessment Form Here

On November 30, 2021, the Ontario legislature passed the long anticipated Bill 27, Working for Workers Act, 2021 (“Bill 27”).  Bill 27 is expected to receive royal assent soon, and employers should prepared to make changes to both employment agreements as well as company-wide policies. Below are some key changes to note.

Employee’s right to disconnect from work

Likely the most well-publicized of the anticipated changes, Schedule 2 of Bill 27 amends the Employment Standards Act, 2000 to give employees of larger businesses the right to disconnect after hours.

Employers with 25 or more employees will be required to have a written policy with respect to disconnecting from work. The term “disconnecting from work” is defined to mean “not engaging in work-related communications, including emails, telephone calls, video calls, or the sending or reviewing of other messages, so as to be free from the performance of work.”

General prohibition on non-compete agreements

Reflecting the common law position on the enforceability of non-compete restrictive covenants, Schedule 2 of Bill 27 prohibits non-compete agreements between employers and employees, with two noted exceptions. The first exception regards the sale (or a lease) of a business. Non-compete agreements between the seller and purchaser may be allowed as a part of the sale where the seller becomes an employee of the purchaser immediately thereafter. The second exception is that a non-compete agreement is not prohibited between an employer and its executives. “Executive” is defined in the Bill 27 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.”

Whether a person fits within the definition of executive is likely to become the focal point of future disputes over whether a non-compete agreement is enforceable.

Updated requirements regarding the use of recruiters

Also important are changes related to recruiters and the protection of foreign nationals. The first of these changes is in Schedule 1 of Bill 27, amending the Employment Protection for Foreign Nationals Act, 2009. The amendment in against recruiters or employers knowingly using the services of a recruiter who has charged a fee to a foreign national. Such activity would contravene subsection 7(1) of the Employment Protection for Foreign Nationals Act, 2009.

Updated licensing requirements for recruiters

Bill 27 also adds licensing requirements for persons operating either as a temporary help agency or as a recruiter. There are also prohibitions against recruiters, employers, prospective employers or temporary help agency’s clients knowingly engaging or using the services of an unlicensed temporary help agency or recruiter.

Updated qualifications requirements for foreign nationals

Schedule 3 of Bill 27 amends the Fair Access to Regulated Professions and Compulsory Trades Act, 2006. Among other things, it prohibits regulated professions from requiring Canadian experience as part of the qualifications for registration unless an exemption from the prohibition is granted.  This amendment reflects the Ontario Human Rights Commission’s Policy Statement Removing the “Canadian experience” barrier, which considers such requirements to be prima facie discriminatory.

Rights for delivery workers

Schedule 5 of Bill 27 amends the Occupational Health and Safety Act. With exceptions, it requires the owner of a workplace to provide access to a washroom to workers making deliveries to or from that workplace.

 

If you need guidance from an experienced employment lawyer, call today at (416)214-2329 or email info@thehumlawfirm.ca or

Complete our Free Assessment Form Here