Ontario enacts temporary change to layoff regulations to help businesses with recovery

Ontario Gov

On Monday, the Ontario provincial government announced temporary changes to its labour laws, a move its hopes will protect employees from permanent layoffs and businesses from potential closures.

“This regulatory change will protect businesses from being forced to permanently lay off their employees due to COVID-19.”

Typically, the province’s Employment Standards Act requires businesses to terminate employees who have been laid off for 13 weeks and pay them severance. The government has enacted a new regulatory amendment to the Employment Standards Act, meant to ensure that businesses are not forced to terminate employees after their temporary layoff periods have expired.

Non-union employees will now be considered on ‘Infectious Disease Emergency Leave’ during COVID-19 if their work hours are temporarily reduced or eliminated by their employer because of the pandemic. Workers will remain employed and will be able to receive legal protections and still be eligible for federal emergency income support programs.

“As we take the necessary steps to safely and gradually restart the economy, we need to make sure business owners can reopen their doors and workers have jobs to go back to,” said Monte McNaughton, Ontario’s minister of labour, training, and skills development. “This regulatory change will protect businesses from being forced to permanently lay off their employees due to COVID-19 and suffer a financial loss that could shutter their operations for good.”

RELATED: What Canadian provinces are doing to support businesses amid COVID-19

The amendment applies retroactively to March 1 and will expire six weeks after the declared state of emergency ends in the province.

According to Statistics Canada, 379,000 Ontario workers were temporarily laid off in April 2020, a year-over-year increase of 2,496 percent.

Ontario noted that its financial accountability office estimates about 2.2 million provincial employees were directly affected by pandemic-related shutdowns, with around half of those facing job losses and the other half seeing “sharply reduced hours.”

A number of Canadian startups that have made pandemic-related layoffs have made the decision to enact temporary layoffs, in the hops of rehiring those employees when things turn around. In some cases, companies have been able to rehire employees.

Meagan Simpson

Meagan Simpson

Meagan is the Associate Editor for BetaKit. A tech writer that is super proud to showcase the Canadian tech scene. Background in almost every type of journalism from sports to politics. Podcast and Harry Potter nerd, photographer and crazy cat lady.