It’s official. With Premier McGuinty’s introduction of “Family Day,” Ontario joins Alberta, Saskatchewan, and British Columbia in providing an additional statutory holiday for all provincially regulated employees on the third Monday of February. The first of these holidays in Ontario will fall on February 18, 2008.

What does this mean for employers in Ontario? Put simply, Family Day will be recognized by the Ontario Employment Standards Act, 2000 (the “ESA”) as a mandatory “statutory” holiday. There were eight paid holidays recognized in Ontario in 2007. Every employee must be guaranteed these holidays as a minimum entitlement and there are specific rules within the ESA as to how holiday pay is calculated and paid, and when holidays may or may not be worked. With the addition of Family Day, employees will now be guaranteed at least nine paid days off. Therefore, if your employees’ contracts currently provide for only the original eight days off, a ninth day must be recognized.

Many Ontario employers already provide their employees with more than the minimum. As a result, recognition of Family Day raises some significant issues. Are Ontario employers obligated to recognize an additional holiday or can an employer assert that one of the current additional days given should be deemed to be for the new Family Day? Section 5(2) of the ESA contains the following provision, which is generally known as the “greater right or benefit” provision:

If one or more provisions in an employment contract or in another Act that directly relate to the same subject matter as an employment standard provide a greater benefit to an employee than the employment standard, the provision or provisions in the contract or Act apply and the employment standard does not apply.

This section applies equally to non-union and unionized workplaces and thus to both individual employment contracts and policies as well as collective agreements. Where the contract contains rights that are greater than the minimum required under the ESA, those additional rights prevail. Currently, many employment contracts, policies and collective agreements include not just the “original eight” Ontario statutory holidays, but also an additional paid day off for the August “Civic Holiday” (which is commonly recognized, but not a mandatory statutory holiday, for the first Monday in August). Other contracts are more general, however, providing employees with a “floater day” as a holiday.

Does Family Day require employers who already provide more than the “original eight” to add one more paid holiday on top of the current complement?

For non-union Ontario employers that already provide more than the “original eight,” the new Family Day may give their employees an extra day off, in addition to those already provided by contract or policy. Should the total number of paid holidays equal or exceed the total number of holidays required by the ESA, however, the employer may be able to assert that it is already providing an equal or greater benefit. As a result, these employers may try to deem one of their current “floaters” as covering the new Family Day. Employers wishing to move a floater day to the new Family Day should, however, remain cognizant of the ESA’s requirements when requiring employees to work a public holiday in exchange for another day off. Should such employers wish to limit the total number of paid holidays, they would also still be best served by giving their employees notice of any change to the holiday policy or practice to address and include Family Day as part of their current benefit. However, the Ministry of Labour has yet to give its direction in this regard.

The issue is also unclear if your workplace is unionized, and will depend on the exact wording of the collective agreement. Some collective agreements, for example, contain a “total” number of days off that include holidays and “floater days” in excess of the “original eight.” For example, a collective agreement that lists the current eight statutory holidays in Ontario, plus two “floater days” means those employees are entitled to a total of ten paid holidays off per year. In this case, the employer is already providing its employees with a “greater right or benefit” and by doing so, there is an argument that there is no further contractual obligation to provide an additional or eleventh day off for Family Day; essentially, the extra day would be covered by one of the already existing floater days as agreed upon with the union. This assumes, however, that the collective agreement does not state that the employer must consult with the union about designating floater days or otherwise specify the dates upon which such holidays must be taken (during an annual shutdown for example).

What the media has portrayed as simply a new mandatory entitlement is demonstrably not so clear. The obligations of employers in Ontario can differ depending on the wording of their contracts, policies and past practice. Because of this, employers should be cautious when broaching the subject with employees. The announcement of the new holiday has been received favourably and will likely have boosted morale in your workplace, given that most employees are likely expecting this extra day off in the middle of winter. As a result, the legal answer of what an employer in Ontario could do may be contrary to the human resources reality of what the company should do.