Temporary Layoff Exemption Extended to July 3, 2021

On May 29, 2020, the Government of Ontario introduced a regulation under the Employment Standards Act, 2000 (“ESA”), that provided relief to any employer that had temporarily laid off or reduced the wages and/or hours of a non-union employee, due to COVID-19. The regulation largely exempts any such layoff or reduction from being deemed a termination of employment, such that there is no obligation to provide ESA notice or severance pay. The employee is deemed to be on an Infectious Disease Emergency Leave (“IDEL”).

If this regulation had not been passed, any such layoff or wage/hour reduction would have crystallized into a termination of employment, triggering ESA notice and severance pay obligations.

Initially, the regulation applied to a temporary layoff or reduction in wages and/or hours between March 1, 2020 and September 4, 2020 (the “COVID-19 Period”). The COVID-19 Period was then extended to January 2, 2021, and now again to July 3, 2021.

The net result is that an employee who has been laid off or had their wages and/or hours reduced for COVID-19 related reasons can continue to be on an IDEL until July 3, 2021, without triggering termination and severance pay obligations under the ESA (unless the employee is laid off due to a permanent discontinuance of business, in which case the employee is entitled to severance pay under the ESA).

For a Briefing Note from Sherrard Kuzz, please click here.