What does the Fair Workplaces, Better Jobs Act mean for your business?

On November 22, 2017, the Government of Ontario passed Bill 148, the Fair Workplaces, Better Jobs Act, 2017. This legislation introduces significant amendments to Ontario’s Employment Standards Act and the Ontario Labour Relations Act. Some of these changes were effective as of January 1, 2018 while others are coming into effect later this year or next year. It is important that businesses operating in Ontario take time to understand what these changes involve and how they impact workplace policies and practices.

What has changed?

Below is a list that highlights some of the changes to the Employment Standards Act that are part of this new legislation. This is not an all-inclusive list however, it does provide a summary of significant changes.

  • The minimum wage was increased to $14.00 an hour effective January 1 and will increase to $15.00 an hour on January 1 2019.
  • After 5 years of service, an employee will be entitled to 3 weeks of vacation time and 6% of vacation pay.
  • There are changes to Personal Emergency Leave (PEL). For example, the 50-employee threshold that previously existed has now been removed so that the leave provisions now apply to every employer in Ontario regardless of the number of employees. In addition, the first two days of  personal emergency leave can now be taken with pay. Lastly, employers are now prohibited from requesting a doctor’s note in relation to personal emergency leave absences.
  • Scheduling requirements have been added which require employers to provide at least 3 hours of regular pay in situations where an employee attends work and then actually works less than 3 hours or has an entire shift cancelled within 48 hours of the shift start time and to provide at least 3 hours of regular pay to an employee who is on-call and is not called in or is called in but works less than 3 hours
  • An individual who is working through an agency is entitled to receive the same rate of pay as an employee of the agency’s client, when the agency employee is doing the same work as the client’s employee.  Differences in rates of pay between agencies and employees, for the same work, will be acceptable when the differences are based on seniority, a merit system, production standards or some other objective rationale. This change also applies to part-time, casual or temporary employees that the employer hires. In these circumstances, employees must receive the same rate of pay as a full time employee who is performing the same work.
  • An employer who incorrectly identifies an individual as an independent contractor when that individual is in fact an employee, will be subject to fines or penalites.
  • The calculation for public holiday pay is based on wages paid in the pay period prior to the public holiday, divided by the days worked in that pay period.
  • The Employment Standards Act currently provides for job-protected leaves in various circumstances. Several leaves, such as pregnancy, parent and family medical leaves have changed. In addition, the Domestic Violence & Sexual Assault Leave is a new leave. This leave entitles an individual to take up to 17 weeks of leave with the first 5 days of the leave being paid.

What actions can we take?

These changes provide an opportunity to review several aspects of your human resources policies and practices. Initially, we recommend that organizations do the following:

  • Conduct a complete review of all employment policies. While the legislation affects a few policies in particular, it is an opportunity to review all employment policies as many policies are related.
  • Assess your compensation structure. Regardless of whether or not your organization already pays at a rate at or above the minimum wage, many employers are taking this time to review their overall pay structure and now that the minimum wage has changed, are assessing the differentials that exist between jobs and job levels.
  • Assess HR and operational practices. In order to implement the changes, there may be changes required to various operational practices. For example, changes to scheduling practices or absence tracking may be needed.

We have provided an overview of some of the changes to the Employment Standards Act however, it is not a complete list included in the Bill. How each change in the Bill impacts an organization will differ from business to business. It is recommended that managers consult with an HR Professional or an employment  lawyer to discuss the specific impact within one’s workplace and to identify actions that must be taken to be compliant.

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