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LeClaire & Associates COVID-19: Status Update 17

Friday, September 4, 2020 - 19:06

Temporary Layoffs – Further Important Considerations

  • September 4, 2020: We recently wrote about the end of the ‘COVID-19 Period’ - as defined in Regulation 228/20 (a Regulation to the Employment Standards Act (“ESA”)), and its particular relevance to temporary layoffs.
  • What other aspects should employers consider if they have to continue with their temporary layoff arrangements beyond September 4, 2020? As a good practice, affected employees who have not been recalled should be provided with a fresh notice of layoff which would serve to clearly distinguish their future periods of layoff (after September 4, 2020), from the previous period of Declared Emergency Leave (“DEL”) - which is what temporary layoffs were converted to between March 1 and ending on September 4, 2020.
  • What is the effect of having employees on a temporary layoff from September 5, 2020? Up until today, September 3, 2020, it appeared that the statutory time limits around temporary layoffs would once again need to be adhered to in order to avoid any deemed termination from being triggered – i.e. a maximum period of 13- weeks in a 20-week period, or a maximum of 35-weeks in any 52-week period, provided that in the latter instance some form of payment or benefits were also continued for the duration thereof. Secondly, it became apparent that the potential risk for claims of constructive dismissal would again become possible where there was no agreement or permissive wording that provided for the right to temporarily layoff. This is because associated claims for constructive dismissal were temporarily excluded by the Regulation and for the duration of the COVID-19 Period. However, this may be about to change once again.
  • HOT OFF THE PRESS: Minister Monte McNaughton Announced today, September 3, 2020 that the Ontario government would continue to assist businesses by preventing temporary layoffs from automatically becoming permanent job losses – promising to extend this protection to employers until January 2, 2021. At the time of this blast being prepared, no further information was available other than at the below link. It is apparent that this announcement will be followed up with a further regulation, which will hopefully confirm under what circumstances employers will be entitled to continue their existing layoff arrangements.
  • Absent this anticipated regulation and any further protections, should employers in any event be considering the inclusion of permissive language around temporary layoffs? This would be a prudent approach to mitigate against the future risk of any claims of constructive dismissal, especially where temporary layoffs are implemented or continued in the absence of such an agreement. For new hires, this is easily achieved through an update to any existing template contract of employment, however for existing employees a more considered approach may be required, taking into account the possibility of notice and even the provision of additional legal consideration (i.e. something of value being exchanged) in order to ensure its enforceability. In the interim, employers are also reminded of the Canada Emergency Wage Subsidy (“CEWS”), which for qualifying businesses, aims to keeps employees on the payroll and avoid the need to resort to temporary layoffs at all.

  • What about employees who were initially placed on a temporary layoff (and later converted to DEL), who have since been recalled but have indicated an inability to return to the workplace? In cases where an employee’s continued absence from the workplace will be at their own instance, it will be important to consider whether there are any accommodations that an employer should consider. This would help to avoid potential claim/s under the Human Rights Code, particularly in relation to allegations of discrimination based on disability and/or family status. Where the issue is not one requiring an accommodation, it would again be prudent that the employer confirm with the employee (in writing), that they are no longer on any form of temporary layoff, but rather on a continued leave of absence, if approved. Alternatively, and in certain circumstances the failure to return to work after a recall could also constitute job abandonment.

Updates: Canada Emergency Response Benefit (“CERB”)

  • Extension: In August 2020, the Federal Government announced that the CERB would be extended from 24 weeks to a total of 28 weeks of coverage. It is hoped that this will address the many applicants who anticipated exhausting their CERB entitlements by the end of August 2020.

The Federal Government has also proposed three (3) new benefit programs

  • First - The Canada Recovery Benefit (“CRB”): The CRB aims to provide $400 per week for up to 26 weeks, to workers who are self-employed or not eligible for EI, and who still require income support and who are available and looking for work. This benefit will support Canadians whose income has dropped or not returned due to COVID-19. The benefit will allow Canadians to earn more income while on claim (a current criticism of the CERB).
  • Second - The Canada Recovery Sickness Benefit (CRSB): The CRSB aims to provide $500 per week for up to two weeks, for workers who are sick or must self-isolate for reasons related to COVID-19. This does not appear to include elective self-isolations where employees have not received a direction to isolate
  • Third – The Canada Recovery Caregiving Benefit (CRCB): The CRCB will provide $500 per week for a period of up to 26 weeks per household and for eligible Canadians unable to work because they must (1) care for a child under age 12 due to the closures of schools or daycares because of COVID19; (2) a family member with a disability or a dependent because their day program or care facility is closed due to COVID-19; or (3) a child, family member with a disability, or a dependent who is not attending school, daycare, or other care facilities under the advice of a medical professional due to being at high-risk if they contract COVID-19. As a result, these types of leave appear to tie in with qualifying criteria for IDEL. What remains to be seen is whether an employee could qualify for CRCB (or perhaps even continue to apply for the CERB) in instances where they themselves elect not to send their children to school / daycare and as precautionary measure. Currently, the answer appears to be no, but the political winds may change on this issue.

Further updates will follow as soon as new information is confirmed. For specifics questions, please feel free to reach out to us directly at – /

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