On May 17, 2007, the Ontario government passed into law Bill 69, the Regulatory Modernization Act, 2007 (the Act). This law will come into force on January 17, 2008, and will significantly affect both the scope of government’s workplace investigations and the penalties and sentences for employers who do not comply with applicable legislation.
Although introduced by the Ministry of Labour, the Act will affect all of Ontario’s enforcement ministries and related agencies (the Designated Ministries), including the Ministry of Labour and the Ministry of the Environment.
Purpose of the Act and Effect on Employers The Act is intended to improve information sharing among the Designated Ministries and to reduce duplication in information collection and compliance activities by the Designated Ministries. While the purpose of the Act is to increase government efficiency in the enforcement of legislation, there is a potentially significant impact on employers.
In particular, the Act will permit the Designated Ministries to:
- share information collected in the course of their investigations with other Designated Ministries;
- share observations made in the course of their investigations with other Designated Ministries;
- consider an employer’s compliance record, including previous convictions and penalties imposed under other legislation, when determining appropriate sentences for legislative violations; and
- make available to the public the information collected in the course of their workplace investigations, including an employer’s compliance record.
1. Information sharing
The Act permits the Designated Ministries to collect and use information obtained by other Designated Ministries in the course of their investigations and compliance activities. This information (collectively called the Shared Information) includes but is not limited to:
- statistical information about an employer and the sector or industry in which an employer operates;
- information about the issuance or renewal, a refusal to issue or renew, or a suspension, revocation or cancellation of a permit, license or other similar approval that an employer may be required to have under legislation;
- complaints against an employer under any legislation enforced by the Designated Ministries;
- information regarding audits, tests and investigations performed by other Designated Ministries; and
- information regarding an employer’s compliance with legislation, including information about prior convictions and penalties.
Such information may only be collected and used for the purposes stated in the Act, which include but are not limited to:
- compiling information regarding an employer’s compliance with designated legislation;
- assisting with determinations regarding an employer’s entitlement or eligibility for a legislative license, permit, certificate or other approval;
- assisting with sentencing; and
- making public the Shared Information.
2. Observation sharing
In addition to permitting Designated Ministries to share information, the Act also permits Designated Ministries to share observations made during their workplace investigations. For example, if an investigator inquiring into a human rights complaint observes an employment standards violation in the course of the human rights investigation, he or she is permitted to record the violation and disclose it to the Ministry of Labour. Accordingly, the Act significantly broadens the scope of workplace investigations and an employer’s exposure to charges of legislative violations.
3. Compliance record and sentencing
The Act also permits government prosecutors to rely on an employer’s prior convictions and penalties as an aggravating factor when determining the appropriate sentence for a current conviction. For a prior conviction to be an aggravating factor, the Act requires that the prior conviction be “relevant” to the current conviction. However, since the Act does not provide a definition of “relevant,” it is not clear what constitutes a relevant prior conviction. Accordingly, it may be possible that an employer with a clean record with the Ministry of Labour may receive a substantial fine in relation to an employment-related conviction if the employer has a poor environmental record.
4. Publicizing of Information
The ability of the Designated Ministries to publicize information collected during their workplace investigations may lead to unwanted negative publicity for employers.
What Can Employers Do?
To guard against the government’s expanded investigatory powers, employers should take the following steps:
- Review workplace policies and procedures to ensure compliance with relevant legislation.
- Appoint a company representative who will act as a liaison between the company and all government inspectors who may visit or otherwise investigate the workplace. Such an appointment will ensure consistency with respect to the information and messaging shared with government inspectors.
- Take account of the current government inspections occurring in the workplace and reconsider the strategy for them, knowing that prior convictions may be used by government prosecutors in relation to sentencing for other legislative violations.