In the second video of Ottawa Business Journal‘s Coping with COVID-19 series, publisher Michael Curran explores the employment law considerations of temporary layoffs.
The panel discussion included three employment lawyers: Jill Lewis of Nelligan Law, Karin Page of Perley-Robertson Hill & McDougall and Joel Rocque of Emond Harnden LLP.
What follows is an edited transcript of the panel discussion.
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OBJ: Jill, let’s start with you. The Premier of Ontario declared a state of emergency earlier Tuesday, which effectively ordered the closure of certain types of businesses such as restaurants and bars. I presume this doesn’t change anything from an employment law context.
LEWIS: Absolutely, Michael, employment laws pertain even more so than in regular circumstances. Employers and employees are still governed by the Employment Standards Act if they are provincially regulated, the Canada Labor Code if they are federally regulated and occupational health and safety, Human Rights Code etc. So yes, these are very sensitive times, but these are the times that we need to understand our rights and obligations under our current legislation and laws.
OBJ: Karin, what are employers required to do to protect the health of their employees in the workplace?
PAGE: Generally speaking, employees still have a requirement and obligation to attend to work, barring any prohibition on such a workplace by a government authority or public health authority. So it’s really coming down to employers deciding what accommodations employers are going to make under the circumstances. Many employers are deciding questions like this. Can some of our operations be taken offline? Can we work remotely? Will we make adjustments to our workplace? As you’ve seen, restaurants are adjusting to just being take-out only. It’s very fluid, obviously, and you will start seeing more employees asking for certain accommodations. Perhaps they’re not comfortable working in tight quarters close to other coworkers. It’s incumbent on employers to see what they can do to enhance the health and safety situation.
OBJ: Joel, let’s come to you next. We’ve already seen in the news and social media that some businesses have suspended their operations. So if a business is taking this difficult decision, they might also feel it’s necessary to issue temporary layoff notices to their employees. What should they consider and what steps must they take.
ROCQUE: Thanks, Michael. The provincial government’s declaration of a state of emergency is kind of forcing the hands of many employers, especially in the restaurant industry and leisure-type businesses, such as theatres and arenas. They no longer have a choice but to close their doors. So at that point one of the things that employers want to look at is layoffs. So a layoff is sort of putting the employment relationship on ice. What you would be required to do is issue a letter of layoff to your employees. You’re not required in the letter to indicate how long the layoff is going to last, but you should be aware that layoffs can last up to 13 weeks, except in certain situations. If you’re maintaining health benefits, for example, your layoff can last a little bit longer than 13 weeks.
OBJ: Jill, I appreciate these are complicated issues, but do you have anything to add on the subject of layoffs?
LEWIS: The one thing I will add is that under the Common Law, lawyers are not allowed to lay off their employees unless it specifically states so in their contracts. This can be incredibly complicated. So even though we have the ability to do it under the ESA, if your contract doesn’t state you have permission, then that employee may deem that temporary layoff as a constructive dismissal. In this case, you would have to pay their statutory notice, possibly statutory severance and possibly a common law notice period. So I do think it’s very important for employers to be seeking advice right now with their lawyers to determine how much liability they are exposed to by laying off certain employees.
OBJ: Karin, let’s give you an opportunity to weigh in on the topic of temporary layoffs.
PAGE: I know one of the frequent questions I’ve been getting is this. Should we be laying off employees or just reducing people’s hours. That’s an important consideration because if you significantly reduce someone’s hours, they will still be eligible for Employment Insurance, but at a greatly reduced rate. So from a practical perspective, it may be better to fully lay off some employees and then try to maintain the hours of other employees. As Jill mentioned, you know if you have that contractual right in your contracts to temporarily layoff employees, that’s even better. I would just add that the employee also has a duty to mitigate their losses. So before they claim constructive dismissal, they should probably be seeking legal advice because in these times it’s not like they can quickly go out and find alternate work. They might be better off accepting the temporary layoff and hoping that they get recalled sooner rather than later.
