Changes Are Coming to Employment Law in Ontario: Part 2 – Is Your Business Ready?
In my last blog post I commented on some of the changes coming to employment law in Ontario. The bill has passed 2nd reading and is well on its way to becoming law. This post looks at some of the other proposed changes. Employers should review their policies and be ready to implement the required changes. For assistance in reviewing your workplace policies, please contact me for a free initial consultation.
The proposed changes include:
Expanded employee rights surrounding scheduling.
The proposed amendments limit employers’ powers to call in shift workers on short notice, for short shifts and have employees ‘on call’ without paying them. For example:
- Employees who usually work more than 3 hours per day must get paid for at least 3 hours if their shift is cut short.
- Employees can refuse to take shifts on less than 4 days’ notice without repercussion.
- If a shift is cancelled within 48 hours of its start, employees must get paid for at least 3 hours.
- Employees who are ‘on call’ but are not called in to work would be entitled to 3 hours of pay for every 24 hour ‘on call’ period.
These changes eliminate some of the loopholes where employers did not have to compensate employees for wasted time. In some industries it is common practice not to pay employees if they are ‘on call’ but not called in. This leaves employees waiting around, forgoing plans on the off chance that they may be called in to work. The flip side of this arrangement was that these kinds of positions usually demanded a higher salary. This compensates them for the possibility of being called in. With that bargaining chip now off the table, it will be interesting to see whether wages for these kinds of employees fall as a result.
Penalties for misclassifying employees as independent contractors.
Some employers retain workers as independent contractors as opposed to employees for the tax savings and limited employment standards benefits. The new rules penalize employers in new ways for improperly classifying a worker as an independent contractor. For example, public prosecution, publication on a ‘wall of shame’, and increased monetary penalties.
In my experience, the Ministry of Labour has a very expansive view of who is an employee and a narrow view of who is an independent contractor. In many cases, employers have been hit with retroactive obligations to pay contributions when an independent contractor suddenly complains that they should have employee benefits. These expanded penalties will likely drive employers to hire people as employees rather than independent contractors. Bad news for independent contractors who are typically paid more and are able to write off more expenses. Good news for government coffers.
Recognition of electronic agreements.
Currently, the Employment Standards Act, 2000 usually requires any agreements between employer and employee to be in writing. This not only includes the employment agreement itself, but agreements to work overtime, extra shifts, take on new kinds of work, etc. The proposed amendment seeks to clarify that an electronic agreement qualifies. This brings the law into the 21st century and is a positive.
As there are many changes proposed, I am splitting this post into several parts. You can look out for other parts of this series on the News & Insights part of the page.
You can view the Ministry of Labour’s press release from May 30, 2017 here, although it is a bit dated as there have been subsequent debates which have lead to amendments. If you’re into that sort of thing, you can find the amendments here.
Disclaimer: None of the foregoing should be considered legal advice. If you would like legal advice on anything in this post, contact me here.