The Ontario government has announced that it will introduce legislation, The Fair Workplaces, Better Jobs Act, 2017, in the coming days to reform the province’s employment standards legislation. The announcement follows last week’s release of the Changing Workplaces Review Final Report which contained a myriad of recommendations for reforms to benefit employees.[1]

The key changes to the Employment Standards Act, 2000 (“ESA”) that the government has indicated will be included in the proposed legislation are summarized below.

Minimum Wage Hike

Ontario’s minimum wage rate would increase to $15.00 by January 1, 2019. If passed, the current rate of $11.40 will increase to $14.00 on January 1, 2018 and increase again to $15.00 on January 1, 2019 under the proposed legislation. While this is a significant increase, it is consistent with planned increases in Alberta. At $12.20, Alberta has the highest minimum wage among Canada’s provinces. Alberta will increase its minimum wage to $13.60 on October 1, 2017 and to $15.00 on October 1, 2018.

Misclassifying Prohibited

Misclassifying employees as independent contractors would be prohibited under the  ESA and subject to a range of penalties, including prosecution, public disclosure of a conviction and monetary penalties. In addition, the person receiving the worker’s services would have the burden of proving that the worker is not an employee in the event of a dispute. This change will enable workers who believe they have been misclassified to more easily pursue claims against the employer without resorting to litigation.

Hurdle Removed for Related Employers

The ESA’s “related employer” provision would be rewritten such that separate but related legal entities could be treated as one employer if they simply carry on associated or related business activities. Currently, separate entities will only be treated as one employer if they have also acted in manner which has the intent or effect of defeating the purpose of the ESA. Eliminating the “intent or effect” test removes a significant barrier to establishing that separate entities are related employers.

Part-Time Workers Entitled to Same Pay as Full-Time Workers

Part-time, casual, temporary and seasonal employees would be entitled to the same rate of pay as comparable full-time employees of the same employer. Exceptions to this rule would be permitted for seniority, merit, systems that set pay by quantity or quality of production, or other objective factors that justify a difference in pay. Employers would need to respond to an employee’s pay review request with either a written explanation or an adjustment in pay. Employees would be protected from reprisal for inquiring about their pay.

Similarly, agency employees would be entitled to the same rate of pay as comparable permanent workers of the employer and have protection from reprisal. Agency workers would also be entitled to one weeks’ notice where their assignment is terminated early, if the assignment was scheduled to last longer than three months.

Scheduling Requests Permitted

Employees with three or more months’ service would have a “right to request” changes in their work hours or location, with protection from reprisal. At present, the ESA does not contain rules regulating how employers set work schedules. The Federal Government made a similar proposal in Budget 2017 which would permit employees to request more flexible work arrangements.

Incremental Changes

Other incremental changes to the ESA, which employers are likely to feel on their bottom-line, are also proposed:

  • increasing vacation time to 3 weeks of paid vacation after 5 years of employment;
  • increasing the student minimum wage to $14.10 by January 1, 2019;
  • increasing the liquor servers’ minimum wage to $13.05 by January 1, 2019;
  • extending personal emergency leave to all employers, including those with less than 50 employees;
  • increasing family medical leave to up to 27 weeks in a 52-week period; and
  • providing a leave of up to 104 weeks for child death from any cause.

Enforcement Efforts to be Strengthened

Up to 175 additional Employment Standards Officers would be hired to carry out inspections and investigate potential non- compliance with the ESA. A goal of inspecting 1 in 10 Ontario workplaces has been set.

Publication of Names of Non-Compliant Employers

In addition to greater flexibility for enforcement officers to issue administrative monetary penalties, the names of individuals who have been issued a penalty would be publishable along with a description of the contravention and the amount of the penalty.

Ontario Premier Kathleen Wynne has indicated that the proposed legislation will be introduced in the coming days. It is anticipated that it could take months before the legislative changes are brought into force.

[1] Ontario’s Changing Workplaces Review is an independent review commissioned by the Ontario government in early 2015. The Special Advisors appointed to undertake the Review, Mr. Justice John Murray and Michael Mitchell, were given a mandate to identify potential reforms to the Employment Standards Act, 2000 and the Labour Relations Act, 1995 to ensure that these statutes reflect modern realities. Within this broad mandate, their key focus has been identifying legislative amendments needed to protect vulnerable workers in precarious jobs.