On October 26, 2023, the Working for Workers Act, 2023 (the “Act”) came into effect and amended various employment-related statutes in Ontario, including the Employment Standards Act, 2000 (the “ESA”), the Occupational Health and Safety Act (the “OHSA”), and the Employment Protection for Foreign Nationals Act, 2009 (the “EPFNA”). Most notably, these amendments include changes to clarify how the ESA’s “mass termination” provisions apply to employers with fully remote workers, as well as increases to the maximum penalties for violations of the OHSA and EPFNA, among other changes.
Employers should carefully review the changes set out below to determine how their business may be impacted, in order to ensure compliance with applicable requirements and avoid costly fines.
Changes to the ESA Impacting Mass Terminations of Employment and Reservist Leave
The Act amended the ESA by adding provisions to clarify how the ESA’s “mass termination” provisions apply to employers with fully remote workers, and by broadening when Canadian Forces reservists are entitled to take a job-protected reservist leave.
By way of background, employees are entitled to a greater amount of notice of termination (or pay in lieu of notice) under the ESA if they are dismissed as part of a “mass termination”, which is where an employer dismisses 50 or more employees at the employer’s “establishment” within the same four-week period. Additionally, where a mass termination occurs, the employer must give notice to the Director of Employment Standards, post prescribed information in a conspicuous place in their workplace, and abide by other related requirements. However, with the rise of work-from-home arrangements during the COVID-19 pandemic, it was unclear whether the dismissal of fully remote workers counts towards the 50-worker threshold for the ESA’s mass termination provisions. This is because it was unclear whether they could be considered to be working at any particular “establishment” of their employer.
The Act has resolved this uncertainty by clarifying that the ESA’s definition of “establishment” includes “a private residence of the employer’s employee if the employee performs work in the private residence and the employee does not perform work at any other location where the employer carries on business”. In other words, an employee who works exclusively from home is considered to be employed at the employer’s establishment, such that they will count towards the 50-employee threshold for the mass termination provisions if they are dismissed. This has major implications for employers with lots of remote workers who may need to substantially downsize their workforce because they will be more likely to trigger the mass termination provisions of the ESA, in which case they will face increased liability in terms of providing notice and/or termination pay, in addition to having to follow various other requirements.
On the other hand, the Act’s expansion of when Canadian Forces reservists are entitled to job-protected reservist leaves will generally be less impactful on employers’ businesses, but it is still important for employers to be cognizant of the newly expanded eligibility criteria. In particular, the Act amended the ESA to provide that reservists are now entitled to a reservist leave where they are in treatment, recovery or rehabilitation in respect of a physical or mental health illness, injury or medical emergency that results from participation in a prescribed operation or activity. Moreover, reservists will become eligible to take reservist leave after completing only two months of employment, whereas they previously needed to have at least three months of service to be eligible.
The Maximum Fines for Corporations under the OHSA Have Increased
As noted above, the Act also amended the OHSA to increase the maximum fines that may be imposed against corporations for violating any of the OHSA’s requirements. Although this is particularly relevant for employers that operate safety-sensitive workplaces, given that large fines are typically imposed in cases involving serious injury or death, all Ontario employers operating through a corporation now face higher potential liability for failing to meet their health and safety obligations.
By way of background, all Ontario employers have a broad duty to take every reasonable precaution for the health and safety of their workers, in addition to a myriad of more specific health and safety obligations. Where an employer, manager, or supervisor fails to comply with the OHSA, or an order issued by an occupational health and safety inspector, they can be liable to fines and/or imprisonment as prescribed by the OHSA.
The Act increased the maximum fine for corporations under the OHSA, such that the maximum penalties are now: (i) a maximum fine of $500,000 or imprisonment of no more than twelve months, in the case of individuals; and (ii) a maximum fine of up to $2,000,000, in the case of corporations. Previously the maximum fine for a corporation was $1,500,000. Thus, it is now more important than ever for employers to ensure that they are meeting their health and safety obligations, including by taking every reasonable precaution for the health and safety of their workers.
The Maximum Penalties under the EPFNA Have Increased
In addition to the above, the Act also increased the maximum penalties for persons who are convicted of violating the Employment Protection for Foreign Nationals Act, 2009 by taking possession of any property of a foreign national which the foreign national is entitled to possess.
By way of background, the EPFNA prohibits employers and recruiters from taking possession of any property of a foreign national which the foreign national is entitled to possess, such as a passport or work permit, in addition to various other prohibitions in relation to foreign workers. Prior to the Act coming into effect there were maximum penalties that applied to any contravention of the EPFNA, but the Act has increased the maximum penalties that apply to contravening the prohibition on taking a foreign national’s property in particular.
Pursuant to the Act, the maximum penalties for taking possession of a foreign national’s passport, work permit, or other property which they are entitled to possess are now: (i) a fine of up to $500,000 or imprisonment of up to twelve months, in the case of individuals; and (ii) a fine of up to $1,000,000, in the case of corporations. Consequently, it is now even more important for employers employing foreign nationals to ensure that their managers, supervisors, and recruiters do not breach the Act.
The Bottom Line
If you have any questions regarding the amendments discussed above, or if you require any assistance with ensuring that your business is meeting its statutory obligations, please do not hesitate to contact us for expert legal advice and guidance.