On July 27, 2016, the Ontario government released the Changing Workplace Review Interim Report ("Report"). This is a comprehensive review of Ontario's two key pieces of employment and labour legislation: the Employment Standards Act, 2000 (ESA) and Labour Relations Act, 1995 (LRA). It discusses a myriad of reform options, including many that are significant and would involve drastic changes in our workplace laws. It bears close attention.
Written by Special Advisors C. Michael Mitchell and John C. Murray, the Report draws inspiration from academic research, experiences in other jurisdictions and the Special Advisors' own professional experience. The issues tackled in the Interim Report are extensive and the options to address them vary widely in their scope and potential effect.
Some of the more controversial options being looked at, by way of example, include:
- Making "dependent contractors" subject to the ESA;
- Making parties liable for the ESA violations of their contractors or sub-contractors;
- Making franchisors liable for ESA violations of their franchisees;
- Changing or eliminating current exclusions from the ESA, such as those for managers, supervisors, IT professionals, and residential care workers;
- Introducing mandatory paid sick leave;
- Increasing the minimum vacation pay standard;
- Requiring that part-time and casual employees be paid the same as full-time employees unless certain justifications can be demonstrated;
- Providing protection against termination without just cause, with reinstatement rights, to non-union employees;
- Imposing restrictions and requirements regarding employee work schedules;
- Giving unions access to employees lists, to help them organize;
- Allowing unions to submit electronic "evidence" that employees have joined up;
- Enabling unions to be certified, without majority or even "adequate" support, if an employer has violated the LRA, and without considering whether a second vote would reflect employees' true wishes; and
- Making certain contractors "successor employers", bound to their client's union agreements.
Here is a summary (PDF).
Employment Standards Act
The Interim Report seeks to address the big issue of employer liability when complex business arrangements may disadvantage employees. In the face of modern corporate structures and business models including affiliates, subcontracting, outsourcing, franchising and the rise of temporary help agencies, the Report contemplates various ways of broadening the circumstances in which companies doing business together could be held to be jointly liable for ESA violations. Some options involve significant reallocation of liabilities for employee costs.
Another particularly creative idea to have made its way in the Interim Report would be the introduction of an "oppression remedy" to protect employees where a business arrangement is unfairly prejudicial to employees. An example might be where the employer is insolvent or has insufficient assets to meet some of its obligations. This type of broad remedy could potentially target a third party in which a principal or related person of the employer holds assets.
The issue of misclassification of employees also figures prominently in the Report. There are concerns about individuals being incorrectly branded independent contractors, whether intentionally or not. The Special Advisors note that Canadian law recognizes three categories of worker classification (employees, independent contractors and dependent contractor), but the ESA recognizes and protects only employees. The Report identifies a range of options to remedy this issue, including covering dependent contractors under all or parts of the ESA; putting the onus on employers to prove that a person is truly a contractor; or simply more proactive enforcement of the ESA where there is a question about employee status.
The various exemptions under the ESA, such as those for managers and supervisors, are also extensively discussed. In many cases, the very existence of exemptions were questioned by stakeholders. The Report does not shy away from examining the rationale and scope of exclusions for managers and supervisor as well as IT professionals.
The complex system of rules surrounding hours of work and overtime pay have been the object of some debate, with some favouring more broad-based industry exemptions and an increased emphasis on human rights and health and safety. Options under consideration include:
- Reducing the weekly overtime trigger from 44 to 40 hours;
- Placing greater limits on overtime averaging agreements;
- Changing or removing current requirements for written consent to work longer than daily or weekly maximum hours; and
- Eliminating or changing the requirement for Ministry approval for excess hours.
Scheduling standards under consideration include:
- Requiring employers to offer additional hours to existing part-time employees before hiring new employees;
- Providing employees with the right to request schedule changes at certain intervals, which the employer would be required to consider;
- Requiring all employers to provide advance notice in setting and changing work schedules; and
- Requiring employers to get consent from workers in order to add hours or shifts after the initial schedule is posted.
Vacation entitlements could be increased to follow other jurisdictions.
The Special Advisors also discuss the possibility of introducing paid sick leave in Ontario.
The personal emergency leave also received some attention, with some stakeholders advocating removing the 50-employee threshold.
One of the lengthier discussions in the Report pertains to temporary help agencies. A plethora of options are being considered to provide more protection to workers, including requiring agency employees to be paid equal wages as those employed by the ultimate customer, capping the use of assignment workers, and extending termination and severance pay entitlements to individual assignments.
The Report also emphasizes the challenges of enforcing the ESA. Independent reports have been commissioned to address this, and it appears likely that significant changes to the enforcement sections of the ESA could be proposed.
Labour Relations Act
One of the more fundamental questions discussed in the Interim Report is the issue of related and joint employers in the LRA context. As it stands, related or associated businesses can be considered to be one and the same employer if certain criteria are met under the "common control or direction" test. That model has been questioned by unions, who claim it is problematic when dealing with franchisees, temporary help agencies and certain other contractual situations where there is an economic dependency on a third party "calling the shots". Among the options considered are the creation of a rebuttable presumption that a temporary help agency's client is the employer. Regarding franchises, the Report considers whether franchisors and franchisees should always be declared joint employers, or whether this should be the case only in certain sectors where there are many "vulnerable workers".
The Special Advisors have also considered whether the current unionisation process is adequate. Lobbying on this is not surprising given the erosion of union membership in the private sector. The return to card-based certification (as opposed to the secret ballot system which exists outside of the construction industry) is one option favoured by the labour community, as is access to employee lists during an organizing drive. More flexible certification voting options (off-site, telephone, and online voting) are also being considered.
First contract arbitration is another hot topic in the Report. Options include granting arbitration either as an automatic right after a defined period of time once the parties reach a strike or lock-out position, or in circumstances where remedial certification (without majority support) has been ordered by the OLRB due to employer misconduct.
A few of the other issues explored by the Special Advisors include:
- the expansion of successor rights to certain contracting out or tendering situations (for instance, in situations like security, cleaning or food services);
- giving the OLRB an explicit power to consolidate multiple bargaining units;
- prohibiting the employment of replacement workers during a strike; and
- moving towards some kind of sectoral bargaining model in some industries.
Next Steps for Stakeholders
The Special Advisors received about 300 submissions from various stakeholders, and identified approximately 50 issues and 225 options to address them. While it appears that employee and labour advocates made extensive submissions to the Special Advisors, the authors make a point of noting that the employer community did not provide its own views on many aspects of this important review.
Any interested parties have until October 14, 2016 to make submissions in the course of this province-wide consultation before the final report is tabled. Submissions can be made by email at CWR.SpecialAdvisors@ontario.ca by fax (416-326-7650) or by mail (Changing Workplaces Review, ELCPB 400 University Ave., 12th Floor, Toronto, Ontario M7A 1T7).
Also, we have arranged a consultation opportunity for our clients with the Special Advisors on October 5, 2016, in Toronto. If you are interested in participating in person, or contributing comments in writing, please contact email@example.com.