In the summer of 2014, the provincial government introduced a bill called the Stronger Workplaces for a Stronger Economy Act, 2014 (“Bill 18”). Bill 18 has received first and second reading, and on October 20, 2014, it was carried on division with an order referring it to a Standing Committee for further study. Bill 18 must pass third reading and royal assent before becoming law. If Bill 18 becomes law, it will have a significant impact on employment law issues in Ontario.
Here is an overview of the most significant proposed changes under Bill 18 and the legislation that it affects.
Employment Standards Act, 2000 (the “ESA”)
- Minimum wage will be increased on an annual basis to account for changes to the Consumer Price Index instead of on an irregular basis, which is how the government has addressed this issue to date.
- Temporary help agencies will be jointly and severally liable with their clients for certain unpaid wages owing to the agency’s employees. Currently, employees can only make a claim against the agency and not the client.
- An employment standards officer may:
- order the payment of certain wages that became due within two years (rather than within six months) before the date of the claim; and
- order an unlimited amount of unpaid wages and other monetary awards (by removing the existing $10,000 cap for such orders).
Employment Protection for Foreign Nationals Act (Live-In Caregivers and Others), 2009 (the “EPFNA”)
- The title will be shortened to “Employment Protection for Foreign Nationals Act, 2009”.
- Correspondingly, the application of the Act will be expanded to include “foreign nationals employed in Ontario or attempting to find employment in Ontario”. Currently, this legislation only applies to foreign nationals working in Ontario as in-home caregivers. To date, the government has not enacted any regulations to provide for protection of any “other” foreign nationals.
Occupational Health and Safety Act (the “OHSA”)
- In certain circumstances, unpaid workers (commonly known as “interns”) will be considered “workers” and thus will be covered by the protections of the legislation. As described in greater detail below, these workers are not currently covered by the OHSA.
Main Highlights for Employers
It is interesting that two of these proposed changes appear to be a direct result of recent public attention to Ontario’s workplace laws while another change is a reversal of a previous government’s decision to limit the powers of employment standards officers. These three highlights are discussed in greater detail below.
- Expanded “Unpaid Worker” Protection
Following in the wake of the Ministry of Labour’s blitzes regarding unpaid workers earlier this year and the resulting media attention, the provincial government has proposed new health and safety protection for these workers.
Previously, unpaid workers (a narrowly defined group of workers) were not covered by either the OHSA or the ESA. Bill 170, a private member’s bill, was introduced in March 2014, and proposes new protections for unpaid workers under the ESA, including imposing limits on hours of work; and providing entitlements to eating periods, vacation, and leaves of absence. Bill 18 goes one step further and provides protection under the OHSA for the previously unrecognized group of unpaid workers.
- Foreign Workers Covered By Same Legislation As Foreign Live-In Caregivers
The use of foreign workers by Ontario employers has been a hot-button topic over the last year. While the sentiment has been largely anti- foreign worker, under Bill 18, the government plans to expand the protections for foreign live-in caregivers to all foreign workers. The change to the EPFNA means that:
- recruiters may not charge fees to foreign workers;
- employers may not deduct costs from or penalize a foreign worker; and
- neither employers nor recruiters may withhold the foreign worker’s property, including a passport or other government paperwork.
- Removal of the $10,000 Cap on Wage Orders
Prior to 1996, there was no limit on the amount of damages that an employment standards officer could award. However, as part of a number of pro-employer changes implemented through the Employment Standards Improvement Act in 1996, the government imposed a $10,000 limit on monetary orders made following a violation of then-ESA.
With the proposed removal of the $10,000 cap, the government has recognized the obvious increase in the value of wage orders (in part due to inflation) and the fact that the cap represents an unreasonable restriction on an employment standards officer’s ability to effectively address unpaid wage claims.
That being said, there have been a number of instances in which employment standards officers have inelegantly applied the law with respect to unpaid wages. If the cap no longer exists, the consequences of such dubious decisions will be much more costly to Ontario employers. When an employee believes he or she is owed significant wages by an employer, that employer will now face the potential of a claim in Superior Court, in Small Claims Court or to the Ministry of Labour, the latter of which has no negative cost consequences to an employee.
Next Steps for Employers
Bill 18 sets out a number of proposed changes to employment standards laws. Assuming that these changes will come into force, employers should take the following steps:
- Employers should prepare for the changes that may arise from the ban on charging recruitment fees and the elimination of the cap on wage orders, which could result in changes to their ability to recruit employees and the types and amounts of unpaid wage claims they are subject to, respectively.
- Employers should reassess their policies and practices to confirm that they reflect the (then current) law.
- Finally, employers should ensure that they notify their employees and, in particular, their managers about the changes and the impact of those changes on their business.