Layoffs: Employee Rights

Ontario’s Employment Standards Act authorizes employers to “temporarily” lay off workers for certain periods of time.

June 24, 2019

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If the worker is not returned to work within those certain periods of time, the worker is considered “terminated”.

This type of “termination” (a statutory termination if you will) obligates the employer to pay statutory minimums (e.g. s. 57 “termination pay” —- which is typically a lot less than what an employee might be entitled to at common law).

Now, there are two significant periods of “temporary layoff” time under the ESA.

For one, an employer can lay an employee off for 13 weeks in any period of 20 consecutive weeks.  During this time, the employer does not have to pay any salary or continue any benefits.

Secondly, an employer can lay an employee off for more than 13 weeks but less than 35 weeks in any period of 52 weeks.   However, the employer must provide the employee with, for example, substantial payments, group benefits (for greater certainty, see s. 56(2)(b) of the ESA).

However, the common law treats a “layoff” (from the very date the employee is laid off) as a loss of employment — and a loss of employment is usually considered a constructive dismissal, unless:

a) your employment contract expressly permits layoffs; or
b) circumstances exist such that the right to lay you off is “implied” into your contract of employment (i.e. you have been laid off before, it is common practice in your particular industry. etc.)

If you have been laid off, it is imperative that you seek legal advice as soon as possible.

You may have significant entitlements.

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