COVID-19 and Employment Law Issues in Ontario Arising from the Pandemic

There are some important carve-outs and other changes to the ESA as well, which people should get legal advice on if they need it.  Some of them are discussed in more detail below.

Q#1: Who is deemed to be on the Layoff-related IDEL leave? Do I have to do anything to be on IDEL?
Most non-unionized employees will be now be deemed to be on “leave”, instead of being temporarily “laid off”, where:
  • the employee’s hours of work are temporarily reduced or eliminated by the employer due to COVID-19, and,
  • as a result, the employee is not performing the duties of his or her position.
Such employees will be deemed to be on what is called Infectious Disease Emergency Leave (“IDEL”), and will not be deemed as being temporarily laid off even if that’s what many businesses and employees have considered it to be thus far.
Employees now on IDEL are now just assumed/deemed to be on it, without being required to state that fact.   
Q#2: Who is Not Eligible for Layoff-related Infectious Disease Emergency Leave?

Employees are not deemed to be on IDEL in the following situations:  
  • where the employer dismisses the employee on or after March 1, 2020 (Note: employers are still able to permanently dismiss whomever they choose to dismiss according to existing common law and statutory laws);
  • where a layoff is necessitated by a permanent discontinuance of all the employer’s business at an establishment on or after March 1, 2020;
  • where the employee resigns in accordance with s. 63(1)(e) of the ESA after receiving notice of termination on or after March 1, 2020;
  • where the employee resigns following a constructive dismissal before May 29, 2020; and,
  • where a deemed termination as a result of the expiry of an applicable temporary layoff period (i.e. the 13 week or 35 week mark) occurs before May 29, 2020.
In addition, employees who have been given written notice of termination will not be considered to be on IDEL unless the employer and employee both agree to withdraw the notice of termination.                                                                                                                                       
Employees who take the position that they have been more permanently separated from the employers, and who are not deemed to be on IDEL, may be able to proceed with claims for severance, etc., and should get legal advice immediately on what to do.            
Q#3: How long will this IDEL leave last? 
No one knows (except maybe the politicians) how long the IDEL leave will be deemed to last.  The COVID-19 period is defined as the period beginning March 1, 2020 and ending on the date that is six (6) weeks after the current Declaration of Emergency in Ontario is terminated or disallowed.  
That means that it will last a while yet.  Hopefully, though, federal benefits such as EI or CERB continue to support most people in this situation.  

Q#4: Will my benefits or EI change while I’m on Layoff/IDEL leave? Or anything else?

Where an employee is deemed to be on IDEL, most requirements and protections that normally apply to leaves under the ESA will also apply during the COVID-19 period.  (See s. 51 of the ESA for more information or the Ontario Government’s ESA Guide).

If you have general eligibility, you should also be continue to be able to receive EI or CERB benefits during your IDEL leave

As for certain employment benefits, during the IDEL leave the rules are different: if the employee stopped participating in certain benefit plans as of May 29, 2020 (i.e. pension plans, life insurance plans, accidental death plans, extended health plans, dental plans) the employee does not have to receive those benefits during the IDEL period.

Correspondingly, if the employer stopped making contributions to any employee benefits plans as of May 29, 2020, the employer does not have to reinstate those contributions during the COVID-19 period.
The Regulation, however, does not attempt to retroactively change any benefits and explicitly states that it will not affect any payments or benefits the employee may have received from the employer between March 1, 2020 to May 29, 2020, so there is no need to fear having to pay existing unpaid premiums or the like.
If changes to employee benefits need to be made after May 29, 2020 the standard requirement to get consent in writing from the employee is required.  

Q#5:  Can I be terminated while on Layoff/IDEL leave?  What about Human Rights, e.g. bona fide medical conditions like anxiety?

It’s possible for terminations to occur, but I urge employers to get legal advice and to work with employees to find alternate solutions if possible.  Moreover, while unlikely, and despite the carve-outs in the new Regulation, it’s possible that courts could find that an employee was on a deemed IDEL leave before being terminated, especially if it’s after the new Regulation can into being on May 29, 2020.

Like most if not all leaves under the ESA, employees who are deemed to be on IDEL leaves may have a right to return to their job or a similar job, if theirs no longer exists.  The regulation suggest that employees who are terminated are not deemed to be on an IDEL leave but I’m not sure that it will be interpreted this way in every case.  So the employer may have to be ready to prove no one replaced the IDEL employee who was terminated after May 29, 2020, even if the Regulation does not appear to require this on its face.  In essence: while it is unlikely due to how the Regulation is written and the carve-outs it has, the employer ought to still be ready to prove the job was eliminated and that no similar job is available (and that the jobs were not given to a new person hired).

But where an employee is deemed to be on IDEL leave, most requirements and protections that normally apply to leaves under the ESA will also apply during the COVID-19 period. What this means is that upon the conclusion of an employee’s leave, the employer has to reinstate the employee to the position the employee most recently held with the employer, if it still exists, or to a comparable position, if it does not.   If the position is discontinued, or there is no comparable position (due to e.g. mass layoffs) then these job protections probably won’t help but it is recommended to still get legal advice.

Subject to the above comments, employers can still proceed with individual terminations and do not need to prove that the whole business is closing are anything like that.  

Still other issues may arise, such as employees who resort to the Human Rights Code (see OHRC website for more information).   Please get legal advice if you are, or could be, dealing with a documented medical restriction due to a condition.

Also, keep in mind that some employees may meet specific criteria for COVID-19-related job protections if they have to be away from work due to, among other things, caring for children who are out of school or daycare, who are in self-isolation, and who are caring for family with COVID-19 symptoms, and other prescribed reasons.  Technically such employees need to let the employer know (ideally in writing) that they are taking the leave or on this leave, but employers should be wary about turning a blind eye to what they know or ought to know.  A good article by my colleague on this issue and certain work refusals is here.

Q#6: What if my termination does not really have to do with COVID-19 and my employer is just using it as a cover-up excuse?

Employers and employees should be mindful that the recent COVID-19 driven changes to the ESA, are specifically tied to work reductions due to COVID-19.  Employers cannot use the Regulation as a convenient cover for layoffs or constructive dismissals that are not really because of COVID-19.   Business decisions that were going to be made already or that the employer finds convenient but have nothing to do with COVID-19 in reality may be successfully challenged by employees. 

It should also be noted that the Regulation does not affect temporary layoffs and/or terminations of employment due to an expiration of the temporary layoff period under the ESA before May 29, 2020.
For almost everyone else, the normal rules are that: employees who are temporarily laid off, or who experience a 50% reduction in wages they would earn at their regular rate in a regular work week, are considered to be on temporary layoff under the ESA.   

The COVID-19 Regulation temporarily replaced the normal rules for most employees who are put on temporary layoff are deemed to have their employment terminated where the layoff lasts longer than 13 weeks in any period of 20 consecutive weeks, or longer than 35 weeks in any period of 52 consecutive weeks where the employee continues to receive substantial payments or benefits.  Therefore, a reduction or elimination of hours or a reduction of wages in these circumstances due to COVID-19 will not be considered a layoff for most employees.

Q#7: What happens to Unionized employees dealing with COVID-19 layoffs?

The old elements of the ESA still set the minimum entitlements for unionized workers, but usually the collective bargaining agreement is the greater source of entitlements and benefits for such union workers.   Still, even under CBAs layoffs could still create deemed terminations in some businesses, given that the above deemed IDEL leave does not apply to unionized workers. 

However, a lot of unionized workers may have benefits, or other perks, which may allow the temporary layoff to last up to 35 weeks in any period of 52 consecutive weeks, before such workers are deemed terminated.  35 weeks is a long time but maybe not in the age of COVID-19 so this is an issue to watch out for is you’re unionized and laid off. 

A termination in the unionized context isn’t always the end of the story either.  Employees may be able to grieve terminations that occur, and employers ordinarily have to prove a permanent discontinuance of the position or just cause to termination.  If that is not the case, which it won’t be for many employees, then affected employees may be able to bump lower seniority workers or get their jobs back through grievance arbitration.   
Q: What about Constructive Dismissal – can a temporary layoff still be deemed a Constructive Dismissal

While it is an uphill battle for many employees to make the argument that layoffs due to COVID-19 are a termination at common law (under judge-made law) it is still possible to make that argument and though there may be some debate it appears that the ESA still does not affect civil remedies – meaning employees still have resort to the courts in constructive dismissal situations. 

This may be lots of situations where constructive dismissals at courts may be an option.   As merely one example: it might be a constructive dismissal if the employee refuses to continue working in a situation where the employer is being too cavalier about not taking safety precautions and putting health and safety protocols in place, especially when public health officials are suggesting or requiring said protocols be implemented.  But the key is really being able to point to what the employer is supposed to be doing based on public guidelines for the specific industry in question, and proving that the employer is refusing to implement them, or acting so recklessly that it effectively refusing to enforce guidelines.

However, if we forgot about going to court, and absent any safety issues or non-COVID-19 layoffs or constructive dismissals: the main takeaway regarding constructive dismissals is that the new Regulation states that a temporary reduction or elimination of hours or a reduction of wages due to COVID-19 during the COVID-19 period does not constitute a constructive dismissal under the ESA.    Importantly, this exemption does not apply to an employee who has already resigned following a constructive dismissal before May 29, 2020 and, again, does not appear to affect any court claim one might chose to initiate.  In other words: the Regulation generally does not affect an employees’ rights under the common law to claim constructive dismissal as a result of reduced hours or reduced compensation or layoffs. Consequently, an employee could still take the position that he/she has been constructively dismissed as a result of changes made to their compensation, hours or a layoff (unless their employment contract permits such changes or they have consented to the changes).

Q#8: What about existing Complaints to the Ministry of Labour (the “Ministry”) that may have been filed by employees?

If an employee has filed a complaint with the Ministry alleging termination due to a reduction or elimination of hours or a reduction of wages, the Regulation states that such complaints will be deemed to not have been filed if the change(s) occurred during the COVID-19 period for reasons related to COVID-19. 
However, this does not apply if the complaint relates to the following: 
  • the employer dismisses the employee;
  • a layoff is necessitated by a permanent discontinuance of all the employer’s business at an establishment;
  • the resignation of an employee after receiving notice of termination on or after March 1, 2020;
  • the employee resigns following a constructive dismissal before May 29, 2020; and,
  • a deemed termination as a result of the expiry of an applicable temporary layoff period occurs before May 29, 2020.
Q#9: I own a business.   With these new amendments can I pick and choose who to leave off work or who to terminate?  Any concerns about who I chose?

It is possible to proceed with terminations and whatever associated cost they will entail even with the new changes to layoffs (but please get legal advice on terminations before proceeding with termination). 
See also: Q#5 above for important information.  And, keep in mind there may be constructive-dismissal and/or human-rights risks if, as an employer, your decisions are creating adverse negative effects for certain employees on the basis of bona fide safety concerns, or on the basis of e.g. age, family status, disability (e.g. anxiety), race, or other protected human rights ground.  So please get legal advice about how to structure returns-to-work or terminations.  

While this is by no means a complete list: here are some further issues for employers to consider before proceeding with terminations.  First, while the new Regulation suggests otherwise, courts may still find that the employer needs to prove that the job was eliminated, and no other similar job was available (i.e. no one was hired later for the position).  It is also quite possible that employees while laid off have become responsible for care of children who are out of school or daycare and that may be why they are resisting a return to work.   Be careful in these situations.  Or they may be caring for children or parents, or other family members, who may or may not be dealing with COVID-19.  Others may have to self-isolate due to exposure or symptoms.  Anyone in these kind of situations will have job-protected rights to leave from work, under s. 50.1 of the ESA, if they make it known as soon as possible.   As a result such workers should not be terminated if it’s because they have taken, or need, a COVID-19-related s. 50.1 leave, or are likely needed the leave but have not advised yet. 
So, if it’s clear that if someone needs the IDEL (ESA s. 50.1) leave, but hasn’t formally said so, employers would be wise to tread carefully and to ask if it’s obvious.   If the person is asserting the right to the leave implicitly or explicitly, and they have told you as much, then termination is barred and not a wise course of action, unless multiple positions are being eliminated permanently and this position is one of many.  But I would caution employers to get advice before proceeding.  Again, a good article by my colleague on this issue and certain work refusals is here.

More updates will likely be forthcoming as the Ontario Government’s response to the COVID-19 pandemic evolves and stay tuned for updates to these answers.

Thank you and I hope these answers are of some assistance.

Please contact me if you need legal advice, or have a case, at 905-572-5806 or
Wesley Jamieson
Wesley Jamieson
P: 905.572.5806