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Waterous Holden Amey Hitchon LLP

The End of the Temporary Lay-Off

– Caitlin Turner
cturner@waterousholden.com

As a result o f the COVID-19 pandemic, Waterous Holden Amey Hitchon LLP Brantford, 20 Wellington St., Brantford.
the Employment Standards Act, 2000
(ESA) was amended so that employers If the employment contract does not have a the notice period, an employee is entitled to
could temporarily lay-off employees for valid ESA limitation clause, an employee is the value of all benefits of their employment.
the duration of the state of emergency, likely to be entitled to pay-in-lieu of notice in This includes their wage or salary, group
plus six weeks. While it is certainly not accordance with the common law. Common benefits, pension contributions, car
business as usual, the declared state law (judge-made) notice is much more allowance, and, depending on the terms of
of emergency ended on July 24. Any generous to employees than the ESA. How the contract, any bonus that would have
employee who is not recalled back to much compensation an employee is entitled been earned through the notice period.
work before September 5, 2020 can to under the common law is dependent If an employee is being offered a termination
consider their employment terminated. upon many factors, including the employee’s package that exceeds their entitlement
age, length of service, position within the
At a minimum, an employee who is not organization, and market conditions. The under the ESA it is important that they sign
recalled to work will be entitled to pay-in- upper limit on notice is usually considered to a release. The release should cover all claims
lieu of notice pursuant to the ESA. How be two years. that an employee could make related to their
much an employee is entitled to under the employment under the common law and all
ESA depends on their years of service and In modern times, judges have not relevant statutes. Before signing a release,
the size of the employer’s business. For an considered the financial position of the the employee should be given a reasonable
organization with less than 50 employees employer to be relevant when calculating opportunity to consult a lawyer.
or a payroll of less than $2,500,000, an an employee’s entitlement to pay-in-lieu of Ending an employee’s employment can
employee could be entitled to up to 8 notice. We are, however, in unprecedented definitely be expensive. It can be even
weeks of pay-in-lieu of notice. For larger times. During the recession of the 1980’s the more expensive when litigation ensues. It
organizations an employee with more than courts were receptive to consideration of the is generally in the best interests of both the
5 years of service would also be entitled employer’s ability to pay when calculating employer and the employee to negotiate a
“severance” of up to 26 weeks’ wages. the notice period. It is difficult to predict mutually agreeable settlement that allows
how the courts will balance the competing
An employee does not need to sign a interests of employers and employees during both parties to plan their futures and move
release in order to receive the ESA minimum these uncertain times. forward in an amicable manner.
payment. A release the provides only the
ESA minimum is unlikely to be enforceable. It is important to bear in mind that during

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18952_BCC-InTouch_sep2020-FPV.indd 11 2020-08-27 4:20 PM