COVID-19 has had and continues to severely impact the Canadian economy. Many employers are now implementing, or at least considering, temporary layoffs because of the voluntary or forced operational shutdowns. Below you’ll find some key information regarding temporary layoffs in British Columbia, Alberta, and Ontario.
What is a Temporary Layoff?
In general, layoffs refer to a period of time where the contract between an employer and employee is temporarily suspended. This means that the employer will stop giving work and compensation for the duration of the layoff. However, the contractual relationship between the employer and employee is maintained, not terminated. In addition, there is an expectation that the employee will be recalled in which work and compensation may continue.
Note that in British Columbia, there no provisions implemented that allow temporary layoffs unless:
- it is agreed to by the employees;
- it is explicitly mentioned in the employee’s written agreement; or
- it is allowed under a collective agreement.
Unfortunately, the definitions for temporary layoffs differ from province to province. The following questions may help with any confusion you may have.
What is it?
A week of layoff is a reduction of 50% or more of an employee’s regular weekly wages, averaged over the previous 8 weeks.
A week of layoff is a reduction of 50% or more of an employee’s regular weekly wages, averaged over the previous 12 consecutive weeks.
How Long do they Last?
Up to 13 weeks in any period of 20 consecutive weeks; or, for an employee who has a right of recall under a collective agreement, within the specified period in the employment contract or collective agreement that includes recall rights for employees in which the employee has a right to be recalled.
Up to 60 days within a 120-day period.
However, that period does not apply if either of the following apply:
(i) after the layoff starts, an employer pays the employee wages or an amount instead of wages;
(ii) the employer makes payments for the benefit of the laid-off employee in accordance with a pension or employee insurance plan or the like;
(iii) there is a collective agreement binding the employer and employee containing recall rights for employees following layoff.
Up to 13 weeks in any consecutive 20-week period. Otherwise, up to 35 weeks in any consecutive 52-week period, if the following conditions are met:
(i) the employee continues to receive payments from the employer,
(ii) the employer continues to make payments for the benefit of the employee under a retirement or pension plan or an insurance plan,
(iii) the employee receives supplementary unemployment benefits,
(iv) the employee is employed elsewhere during the layoff and would be entitled to receive supplementary unemployment benefits,
(v) the employer recalls the employee within the time approved by the director,
(vi) in the case of an employee who is not represented by a trade union, the employer recalls the employee within the time set out in an agreement between the employer and the employee.
Are Notices Required?
Yes. There is no mention in the Alberta Employment Standards Code of a requirement on the part of the employer to provide the employee a written notice of temporary layoff; however, the Court of Appeal of Alberta has defined minimum obligations of the employer intending to lay off an employee.
Does an Employer’s Obligations Change Depending on Number of Layoffs?
When 50 or more employees’ employment is terminated within any two-month period, group termination entitlements apply.
When 50 or more employees’ employment is terminated within a 4-week period, group termination entitlements apply.
At Sodagar & Co., we can help you understand the subtleties and differences across jurisdictions when it comes to temporary layoffs. We recognize that businesses are needing to constantly adapt due to the COVID-19 outbreak. Therefore, we want to help protect you and your business, employees and employers. Again, we are able to service your needs remotely. To read more about our response to the coronavirus, click here.