As we approach the third anniversary of the first response to COVID-19 in Canada, many of the employment law changes that arose during 2020 have been adapted to suit the evolving landscape and are still in effect. As we can all attest, staying up to date on the various changes to the Employment Standards Act (“ESA”) and the common law has been a complicated task. Below, we offer a review of where things stand currently regarding paid sick days, Infectious Disease Emergency Leave, constructive dismissal, the pandemic’s impact on common law notice periods, and considerations around remote work.
Infectious disease emergency leave & paid sick days
First coming into effect on May 29, 2020, Ontario Regulation 228/20 Infectious Disease Emergency Leave (O. Reg 228/20) (“IDEL”) introduced a number of changes to the Employment Standards Act (“ESA”). It entitled an employee who was unable to work for reasons related to COVID-19 to three paid sick days, for which the employer could be reimbursed by the Workplace Safety and Insurance Board. It also stipulated that during the “COVID-19 period”, a non-unionized employee who had their hours of work temporarily reduced or eliminated due to COVID-19 would be deemed to be on an Infectious Disease Emergency Leave and not laid-off or constructively dismissed under the ESA. These provisions exempting lay-offs under IDEL from being considered constructive dismissal ended on June 30, 2022. So keep in mind, the temporary lay-off provisions of the ESA once again apply, and a lay-off of more than 13 weeks in any period of 20 consecutive weeks, or a lay-off of more than 35 weeks in any period of 52 consecutive weeks (with certain benefits continued) will be considered a termination.
Paid sick days
Currently, paid sick days under the ESA are still in effect until March 31, 2023. Accordingly, Ontario employers are obligated to continue providing employees with up to three days of paid leave if they are unable to work for reasons related to COVID-19, including caring for family members. There has not yet been any indication of whether paid sick days will be extended past March 31, 2023.
The change to the law of constructive dismissal under O. Reg 228/20 was welcome news to the many employers who had been forced to make sudden and unexpected changes to their businesses during COVID-19. However, we have seen over the past three years that the impact of these amendments to the ESA on the common law doctrine of constructive dismissal is unclear.
To date, this issue has been addressed in three court decisions. First, in April 2021, the decision in Coutinho v Ocular Health Centre Ltd., 2021 ONSC 3076 (Coutinho) was released. In Coutinho, the Ontario Superior Court determined that a layoff related to COVID-19 could be constructive dismissal at common law and that the employee’s common law claim for constructive dismissal was not displaced by the amendment to the ESA made under O. Reg. 228/20. Accordingly, while an employee who had been placed on a lay-off under IDEL could not bring a complaint at the Ministry of Labour, they could still bring a claim for constructive dismissal in court under the common law.
Then, in June 2021, the Court ruling in Taylor v Hanley Hospitality Inc., 2021 ONSC 3135 (Taylor) came to the opposite conclusion to the one in Coutinho, and held that the amendment to the ESA did displace the common law doctrine of constructive dismissal in the context of COVID-19, meaning that an employee could not succeed in bringing a claim for constructive dismissal to the Ministry of Labour, or in court. However, this employer friendly decision was appealed, and in May 2022, the Ontario Court of Appeal set aside the Superior Court’s ruling (Taylor v Hanley Hospitality Inc., 2022 ONCA 376). Due to other procedural issues, the Court of Appeal declined to address the issue of constructive dismissal at common law in the context of the changes to the ESA made by O. Reg. 228/20.
Given the lack of clarity from the Court, this is still a volatile area. Employers would be wise to keep some room in their budgets for litigation risk when dealing with lay-offs that occurred over the past two years.
Impact on notice periods and employee mitigation obligations
As most employers know, if you don’t have an employment contract with a valid termination clause, a common law assessment of the appropriate notice applies when an employee is terminated, resulting in a greater entitlement than under the ESA. When the courts assess an employee’s length of reasonable notice owed at common law, they take into consideration various factors which affect how long it might take that employee to find new employment. This is a fact-specific exercise, and depends on the circumstances of each person. The courts further consider what steps the person has taken to try to find a new job and mitigate the damages arising from their termination. Of course, the pandemic has had a far reaching impact on the job market and has changed how long it takes for many people to find work.
In several recent cases, the Courts have considered how COVID-19 plays into assessing notice periods and mitigation. In Williams v. Air Canada, 2022 ONSC 6616,the Court considered how the pandemic impacted the length of the notice period, and the availability of alternate employment. The Court held that “the economic uncertainty caused by the pandemic is a factor that may lengthen an employee’s notice period.” They also found that Ms. Williams had not failed to mitigate her damages, because they were mindful that her “re-entry into the job market, as well as her job search, took place during the COVID-19 pandemic, with unprecedented restrictions and lockdowns, and associated economic uncertainty.”
In Gracias v. Dr. David Walt Dentistry, 2022 ONSC 2967, the Court took a slightly more nuanced approach, and while it was recognized that the pandemic was harmful for the overall economy, the Court noted that the pandemic’s effect across different industries was not uniform. Accordingly, the Court held that it was a matter of evidence whether or not the pandemic harmed the industry specific to each employee. In this case, the evidence that the Court considered in determining whether the industry had been impacted was the number of job applications submitted by the plaintiff.
In September 2022, another decision was released supporting this more context specific approach. In Nassar v. Oracle Global Services, 2022 ONSC 5401, the Court reiterated that there must be evidence that demonstrates that the plaintiff was “in fact hampered in [their] efforts to obtain new employment” in order for the Court to extend the length of the notice period. Specifically, they held that it is “not enough to suggest in a general way that the pandemic hampered employment efforts without supporting evidence on behalf of the wrongfully dismissed employee.”
As we continue to observe the return of some industries to a more pre-COVID status, it seems likely that Courts will continue to require specific evidence that plaintiffs’ job opportunities were in fact impacted by the pandemic before extending the notice period. The good news for employers is that while many employees asserting wrongful dismissal will likely claim that their notice period should be increased because of COVID, without some supporting facts they may not be successful.
Remote work policies
The shifts that were made by many companies to remote work during the pandemic will likely have a lasting impact on the way workplaces are structured. While by now we have all become more adept at the technical side of working remotely, there are many legal considerations for employers in extending remote work. Regardless of whether an employee is working on-site or remotely, the employer has to comply with all applicable employment standards legislation, including the ESA and the Occupational Health and Safety Act. Employers should also consider other issues such as the legal jurisdiction that may apply when an employee is working outside the province or the country. Creating a remote work policy addressing these and other issues is an advisable step for employers who have ongoing remote work arrangements.
Employers also need to be prepared to respond to employee requests to continue working remotely with the proper consideration of human rights issues. As employers should be aware, there is a duty under the Ontario Human Rights Code (“the Code”) to accommodate employees with disabilities up to the point of undue hardship. An employee request for accommodation to work from home due to disability typically cannot be refused by an employer if the employee can complete the essential duties of the job, and the employer cannot demonstrate that the accommodation would cause undue hardship to the business.
The way we work, and employment law as a whole has changed dramatically since 2020. We’re now starting to return to the pre-2020 state of the law in some regards, but a few changes made during the pandemic may be with us to stay. Employers should continue to keep an eye out for updates to legislation, and new rulings from the courts on these evolving issues. As always, feel free to reach out to the lawyers at Simes Law for assistance in navigating the ever changing world of employment law.
- Three years later – a review of employment law and the pandemic - March 7, 2023
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