Employment Law FAQs 

The following FAQs are intended to provide answers to the most commonly asked employment law questions received by NCLI. They will be updated periodically as new questions arise.

Federal Layoffs

I am employed by the Federal government or a federally regulated entity. Was my employer allowed to lay me off?

Does the Canada Labour Code apply to me?

The regulations set out in the Canada Labour Code only apply to you if you work in a federally regulated industry. If you are a full-time or part-time employee in industries under federal jurisdiction such as the railways, banking, federal crown corporations, etc., then the Code applies to you.

The regulations set out in the Canada Labour Code only apply to you if you work in a federally regulated industry. If you are a full-time or part-time employee in industries under federal jurisdiction such as the railways, banking, federal crown corporations, etc., then the Code applies to you. This is a helpful infographic that provides a list of federally regulated industries. Another useful page explaining the Canada Labour Code can be found here too.

If your employer is not the Canadian Federal Government or a federally-regulated entity mentioned in the hyperlinks we provide in the paragraph above, you may be a provincially-regulated employee, in which case, please scroll to the  section below.

Was my employer allowed to lay me off?

If your employer has laid you off and your workplace is not unionized (meaning, not represented by a trade union), you should first look at your employment contract. If your employment contract allows your employer to lay you off for a temporary period, make sure that this period is not more than the Canada Labour Code. Your employer is not allowed to contract out of the standard set by the Code. Usually, a temporary lay-off period can last three months or less. If the lay-off exceeds three months, it will only be valid if

  1. your employer notifies you in writing at the time of the lay-off or shortly before that you will be recalled at a fixed date within 6 months and you are then recalled to work; OR
  2. during the time you are laid off, you continue to receive payments from your employer for an amount agreed by you and them; OR
  3. during the time you are laid off, your employer continues to make payments on your behalf to your pension plan; OR
  4. you receive supplementary unemployment benefits or you would be entitled to them but are disqualified under the Employment Insurance Act; OR
  5. if you are unionized, if your lay-off lasts no longer than 12 months and throughout the term of your lay-off, you maintain recall rights pursuant to a collective agreement.
Am I affected by new federal regulations respecting layoffs during COVID-19?

It is important to note that these regulations have been recently changed due to COVID-19.  The Minister of Labour has announced that temporary layoff periods will be extended so that employers have more time to recall their employees.

If you were laid off prior to March 31, 2020, the lay-off period has been extended to December 30, 2020 or six months (whichever comes first) [http://gazette.gc.ca/rp-pr/p2/2020/2020-07-08/html/sor-dors138-eng.html].

If you were laid off between March 31, 2020 and September 30, 2020, the period is extended until December 30, 2020 (unless your employer provided you a later recall date at the time of your lay off).

If your lay-off period had already reached its maximum duration before June 22 (the date on which the regulations were amended), you have the right to termination notice and pay. Remember that a laid-off employee is deemed terminated when they are not called back to work before their lay-off period is elapsed. These amendments have also not been extended for lay-offs that happen after September 30, 2020 as of writing [http://gazette.gc.ca/rp-pr/p2/2020/2020-07-08/html/sor-dors138-eng.html].

    What are my rights and recourses against my employer?

    If your employment contract does not allow your employer to explicitly or implicitly lay you off, you can choose to contest the lay-off decision in a civil proceeding. Without a provision allowing lay-offs through the employment contract or collective bargaining agreement, lay-offs can be considered to be a fundamental change in the employment relationship. However, keep in mind that a judge may rule a lay-off to be a constructive dismissal (thereby ending the employment relationship and entitling you to termination notice and pay). In that case, you would lose the right to return to work.

    If your temporary lay-off period has been exhausted and you have been deemed terminated, you have rights to termination notice and pay. You are considered to be terminated on the first day of the lay-off. You may be entitled to receive pay in lieu of notice and severance pay.

    Under the Canada Labour Code, you are entitled to two weeks’ prior notice or two weeks wages at your regular rate if you have completed at least 3 months of continuous employment. You are also entitled to severance pay if you have completed at least 12 months of continuous employment. You are entitled to two days’ wages for each year you worked for the employer or five days wages (whichever is greater).

    If your employer refuses to pay your termination or severance pay, you can file a complaint with the Labour Program to recover unpaid wages within six months from the last day your employer had to pay you. You can file a complaint here [https://www.canada.ca/en/employment-social-development/services/labour-standards/reports/filing-complaint.html#s01].

      Initiating civil proceedings

      You can also initiate civil proceedings (typically referred to as “going to court”) against your employer. Aside from notice and severance pay, you may be able to recover moral or punitive damages at common law. A court will determine the reasonable notice period you are entitled to based on your particular case and factors such as the length of your employment, age, experience, qualifications and the nature of your work. Your reasonable notice period at common law may be longer than the minimum you are entitled to under the Canada Labour Code.

      If you work for a federally regulated employer, you have an additional remedy to contest your dismissal. If you have worked for your employer for more than 12 months, and you consider your dismissal to be unjust, you can file a complaint under the Unjust Dismissal scheme [https://www.canada.ca/en/employment-social-development/services/labour-standards/reports/complaint-dismissal.html]. You can request your employer to provide a written statement explaining the reasons for your dismissal. Your employer has to reply to you within 15 days. You can also lodge a complaint by filling out this form. You have 90 days from the day were dismissed to file a complaint. Adjudicators have a wider range of remedies available to them than the courts. Therefore, if you file a complaint of unjust dismissal, you may be able to receive back pay and the adjudicator may also order your reinstatement. 

      If you were dismissed due to lack of work or discontinuance of function, this scheme will not apply to you. You can file a complaint, but your employer would have to show that the dismissal was for economic reasons.

      This page has tried to lay out the multiple options before you. Given that each case is different, you may benefit from discussing your case with a lawyer who may be able to advise on which option is better for you.

      Provincial Layoffs (Ontario)

      I am not employed by the Federal government or a federally regulated entity. Was my employer allowed to lay me off?

      Was my employer allowed to lay me off?

      Due to the global COVID-19 pandemic, many individuals have been temporarily laid off of work to limit the spread of the virus. This has left many employees confused regarding what their rights are, and worried that they will face termination during these uncertain times.

      The information below applies only if you are not an employee of the Federal government or a federally-regulated entity. You can find whether you are a federally-regulated entity by looking at this list [https://www.canada.ca/en/services/jobs/workplace/federally-regulated-industries.html]. If still unsure, we offer guidance to determine whether you are a federally-regulated employee here [Federal employee post]

      First, you should determine whether you are:

      • actually considered to be laid off at law, or
      • whether you are considered on infectious disease emergency leave.

      Usually, a temporary layoff in Ontario should be no more than 13 weeks in a period of 20 consecutive weeks, or 35 weeks within a period of 52 weeks so long as you are still receiving substantial payment and benefit contributions from your employer, and you are recalled within a reasonable time.

      If you are not represented by a trade union (unionized), your employer would have to recall you within the time set out in your employment agreement. If you are not represented by a trade union (non-unionized), your employer cannot contract out of temporary layoff periods.

      Ontario Regulation 228/20

      Many employee’s that have been laid off due to COVID-19 are not considered to be on temporary layoff due to the new Ontario Regulation 228/20 [https://www.ontario.ca/laws/regulation/r20228] which was filed on May 29, 2020. Under the Regulation, non-unionized employees who experience a reduction or elimination of work hours after March 1, 2020 are considered to be on temporary infectious disease emergency leave.

      Usually, after the temporary layoff period exhausts itself, employees are considered to be terminated on the first day of the layoff. The new Regulation avoids this so that employees can retain their jobs after the COVID-19 pandemic.

      This Regulation is only operative from March 1, 2020 until six weeks after the emergency orders declared by the Ontario government are terminated. Currently, all emergency orders in Ontario have been extended to July 29, 2020.

      What happens if I am actually laid off and not on infectious disease emergency leave?

      If you have determined that you are actually laid off and not on infectious disease emergency leave, it is important for you to know that unionized employees may be lawfully subject to layoffs of more than 35 weeks within a 52-week period without being considered terminated. If you have the right to be recalled under your employment contract or your collective agreement and you have been laid off for a period more than 35 weeks, you can elect to either:

      • receive either termination pay,
      • receive severance pay, or
      • retain the right to be recalled to work.

      An employer cannot lay you off simply to avoid or delay making termination payments or providing termination notices. If an employer has indicated through their conduct that they have no genuine intention of recalling you to work, courts could consider this to amount to termination. This could occur if you are laid off when there is no genuine lack of work.

      Employers are not required to recall employees, nevertheless. Many temporary layoffs result in termination when employers cannot provide work for employees. However, if you find yourself in such situation, you could be entitled to pay in lieu of notice and could have a claim for wrongful dismissal.

      What are my rights and recourses?

      If you believe your employer has wrongfully laid you off, or your layoff resulted in termination, you may have the following rights and recourses.

      Employees do not have the right to reasonable notice that they will be laid off. However, once the temporary layoff period (see “Was my employer allowed to lay me off” above) is exhausted, they are considered to be terminated on the first day of the layoff. If so, employees are entitled to receive either pay in lieu of notice or severance pay.

      Pay in lieu of notice is a lump sum, equal to the amount of money you would have received during the reasonable notice period for termination. This reasonable notice period varies according to the length of time you have been an employee of your employer.

      Under Ontario’s Employment Standards Act, the reasonable notice period is dependent upon your period of employment. If you worked with that employer for less than one year, you would be entitled to a notice period of at least one week. In contrast, if you worked with that employer for a period of eight years or more, you would be entitled to notice at least eight weeks prior to termination. When your employer is distributing pay in lieu of notice, they must continue to contribute to any benefit plans that you would regularly be entitled to.

      In contrast, employees are entitled to severance pay only if they were employed by that employer for five years or more and the severance either occurred due to permanent discontinuance of business at an establishment resulting in 50 or more employees jobs being severed within 6 months, or the employer has a payroll greater or equal to $2.5 million.

      Severance pay is calculated differently than termination pay. It is calculated by multiplying your wages from a regular work week by the sum of these two numbers: the number of complete years you have been employed by that employer, and the number of months of employment beyond those completed years divided by 12. Put another way, the severance pay you are entitled to is equal to:

       

      If you were terminated without notice, your severance pay would be calculated as if you were employed for the notice period to which you were entitled and did not receive.

        Where can I file a claim?

        If you are unhappy with the situation surrounding your layoff or subsequent termination and believe it violates the Employment Standards Act, you can file a complaint with the Ministry of Labour in a written or electronic form.

        However, note that you cannot file a complaint under the Act if you are also filing a civil proceeding (typically referred to as “going to court”) for wrongful dismissal relating to the same termination. This is the same for complaints filed regarding your entitlement to termination or severance pay.

        If you would rather commence a civil proceeding, you can withdraw your complaint within two weeks after it is filed. All complaints under the Act must be brought forth within two years of the alleged breach of the Act. If you chose to file a complaint under the Act, you will have to represent yourself.

        Note that this route may limit your possible financial recovery, as you cannot claim certain damages that common law can provide such as moral or punitive damages. You may need to consult a lawyer to know which option is best for you.

        The common law will enforce your rights to pay in lieu of notice or severance pay if courts find you are entitled to it. Therefore, if your employer is refusing to distribute pay in lieu of notice after the temporary layoff period is exhausted, you can take recourse under the common law.

        As mentioned above, pay in lieu of notice is contingent upon the notice period you are entitled to. When determining the reasonable notice period, courts are likely to consider all facts at hand, including the length of your service, your age, experience and qualifications, and the nature of your employment. The common law notice period beings to run on the first day of your layoff.

        In unionized workplaces, collective agreements usually anticipate layoffs, which allows employers to impose them. However, in non-unionized workplaces, layoffs longer than the temporary layoff periods may amount to wrongful dismissal.

        If you would rather commence a civil action as opposed to filing a complaint under the Employment Standards Act, it is important to note that the general limitation period on the commencement of civil actions is two years from the date on which the claim was discovered. For wrongful dismissal actions specifically, the cause of action arises on the date of notice of termination or layoff. Therefore, employees can bring a civil proceeding forth within no later than two years from the date they received notice.

        This may be a more beneficial route for employees, as they can claim for moral and punitive damages in addition to wrongful dismissal damages and are not required to self-represent.

         

        Prepared by Bradley Smith, Laurent Crépeau, Mehlka Mustansir and Michaila Francesca Graziani. 

        Disclaimer: Although this legal summary has been prepared with the utmost care, we do not assume any liability for the content being correct, complete and up to date. Our summary cannot replace legal advice in individual cases. We are at your disposal for specific legal advice.