Upcoming and Significant Changes to Ontario Workplace Regime

Authored by Philip A.S. Milley, Associate Director, Legal Affairs 

In 2015 the Ontario government initiated a Changing Workplaces Review, which resulted in a 416-page report (the “Report”) containing several recommended changes to the regulation of employment and labour in the province. The Report has garnered much attention from employees and employers alike due to the wide-sweeping and significant changes that are proposed. On June 1, 2017, the Minister introduced Bill 148, Fair Workplaces, Better Jobs Act, 2017, which proposes in introduce several of the recommendations contained in the Final Report.

A primary policy objective of the legislation is to balance the power dynamic between employers and employees[i]. The government intends to address the common case of employees forgoing rights as the result of ignorance or risk of adverse treatment and reprisal from employers for doing so. While many commentators consider the proposed changes a win for employees’ others are concerned that this legislation tips the balance too far in favour of employees. Many are concerned about higher operating costs and other unforeseen impacts on employers.

The new legislation is due to come into force on January 1, 2018, which will introduce changes to both the Employment Standards Act, 2000 SO 2000 c 41 and the Labour Relations Act, 1995 SO 1995 c 1 Sch A.

Legislative Changes

Most charities will be interested in the changes to the Employment Standards Act as these are the laws that apply to non-unionized workplaces. The changes that occur to the Labour Relations Act will bear no impact on non-unionized workplaces. As a result, only the most significant changes that impact non-unionized workplaces are reviewed below. The legislative changes are as follows:

1. Increase to Minimum Wage: Minimum wage will increase on January 1, 2018 to $14.00 and again on January 1, 2019 to $15.00. Minimum wage is also to be subject to an annual inflation adjustment on October 1 of every year starting in 2019. (s. 23.1)
2. Three Weeks Paid Vacation: Increase of paid vacation entitlement from two to three weeks for employees of five or more years of service. (Part XI)
3. New Calculation for Public Holiday Pay: A simplified calculation method for public holiday pay. (Part X s. 24-29)
4. Fewer Exceptions to Minimum Wage: Section 1 of the ESA will be amended to either eliminate or increase lower pay rates permitted for certain types of employees including, among others, students. (s. 23.1)
5. Equal Pay for Equal Work: Employment status, such as casual, part-time, temporary and seasonal will no longer be a basis to pay lesser rates. Subject to limited exceptions, employees will be entitled to the same pay as full-time employees for the same work. (Part XII)
6. Longer Leaves:
   1. Personal emergency leave will be extended to all employees. In addition, the first two days are required to be paid. (Part XIV S. 50)
   2. Family medical leave is increased from eight weeks to 27 weeks. (Part XIV)
   3. Entitlement to 104 weeks of unpaid leave for circumstances where an employee’s child dies or disappears related to crime. (Part XIV S. 49.5 and 49.6)

7. No More Sick Notes: Employers will not be permitted to request sick notes from an employee taking personal emergency leave. (s. 50)
8. Increased Employee Rights regarding Shifts: Various employee rights including:
   1. To request scheduling changes. (Part VII s. 1)
   2. To refuse shifts assigned with less than four days’ notice. (Part VII s. 2)
   3. To receive three hours’ pay for shifts less than three hours for being on-call when not called in for at least three hours, and for shift cancellations on less than 48 hours notice. (Part VII s. 2)
9. Fines for Misclassification of Employees: Bill 148 prohibits an employer from misclassifying employees as independent contractors and, therefore, will be subject to fines (s. 5.1). Employers will bear the burden to prove that an individual is an independent contractor as opposed to an employee.
10. New Public Holiday: Family Day, which is to be the third Monday in February, is included in the definition of public holiday. (s. 1(1))

Not all Recommendations are Incorporated into the Bill

Bill 148 incorporates many, but not all, of the recommendations contained in the Final Report. Some recommendations not included, include:

1. Definition of Employee: A broader definition of “employee” which was recommended to include dependent contractors, was not included.
2. Increased Fines: Bill 148 provides that fines for contraventions are to be determined within a penalty range set by the regulations. It is expected that maximum fines will increase from $250, $500 and $1,000 to $350, $700 and $1,500 for various violations. (s. 113)
3. ESA Exemptions: The Final Report recommended that the wide-ranging set of exemptions to the ESA minimum protections be addressed. Bill 148 does not address any of these exemptions and exempt many classes of employees from the ESA minimum protections. The exemption for “holders of religious office” is maintained. It is important to watch whether any developments to this exemption will occur at a future date.

What this Means for Charities

Charities with provincially-regulated employees in Ontario will be interested in the upcoming changes to the Employment Standards Act as the changes will have a significant impact on your ministry. It is likely that increased operational and administration costs will be necessary. Your charity should be prepared to implement and address necessary changes before the legislation comes into force.

[i] https://news.ontario.ca/mol/en/2017/05/statement-from-minister-flynn-on-the-release-of-the-changing-workplaces-review-final-report.html?_ga=2.208069013.660405729.1503082989-481818795.1478179051