Ontario Employers Operating in Multiple Jurisdictions – Court Rules Severance Pay Under the ESA is not Limited to Ontario Payroll

This legal case has changed how severance may be calculated if you are an Ontario Employer. Take a read to see if it affects you…

Ontario employers with a payroll of $2.5 million or more are required under Section 64 of the Ontario Employment Standards Act, 2000 (the “ESA”) to pay statutory severance pay to terminated employees who have five or more years of service.
In Hawkes v Max Aicher (“Hawkes”) the Divisional Court overturned an earlier Ontario Labour Relations Board (“OLRB”) decision and found that the $2.5 million threshold is not limited to an employer’s payroll in Ontario, but instead, based on an employer’s global payroll. In this context, ‘global payroll’ means the total payroll of the employer including Ontario, all payrolls in provinces outside of Ontario and payrolls throughout the world as well as the payrolls of related companies to the employer. The Court, in coming to its decision, noted that there is nothing in the provision itself that limits the calculation to Ontario payroll. The Court, to support its finding, cited previous decisions by the Supreme Court of Canada, which stand for the principal that the ESA should be characterized as benefits-conferring legislation and interpreted in a broad and generous manner in order to extend its protection to as many employees as possible.
This decision is somewhat surprising because it contradicts a number of OLRB decisions. Although, it is noteworthy the OLRB has essentially ignored a similar court decision from 2014. With two such decisions on the books, it will be interesting to see if the OLRB will follow Hawkes or if the legislature will amend the ESA to address the inconsistencies between the OLRB’s historical approach and cases like Hawkes.
Key Takeaways: We understand that this case is likely to be appealed. However, for the time being, it appears there is now more caselaw in support of the position that the severance pay calculation is based upon global payroll rather than Ontario payroll. With this in mind, Ontario employers will need to be prepared to pay severance pay where their global payroll exceeds $2.5 million annually. Strategically, Ontario employers may decide to wait until they are ordered to pay severance pay by the OLRB or a court, or simply pay it out upon termination to avoid any potential issues.
If you have any questions regarding this, or terminations in general, do not hesitate to reach out to speak with an e2r™ Advisor.  READ MORE

Ontario Extends Deemed IDEL Yet Again

The article below will explain more about the Ontario IDEL extension.

The Ontario government has once again extended the deemed Infectious Disease Emergency Leave (“IDEL”), which had been set to expire on July 3rd, 2021, and now will end on September 25, 2021.

This is good news for employers who have employees on this job-protected leave and are not prepared to bring them back in the near future but are not necessarily wanting to terminate.

This leave was first created in March 2020, retroactive to January 25, 2020, and has been set to expire and extended several times since.  If the leave does end on September 25, 2021, employees on the leave will be converted to a temporary layoff.

It is also important to note the possible constructive dismissal risks associated with this leave, which we discussed in a recent Alert found here.


Ontario Employers with over 20 staff are required to do this by June 30th, 2021

Just a reminder that the AODA is coming into effect at the end of the month for Ontario employers with over 20 staff.  If you’re over 50 employees there are additional requirements.  The article below summarizes well so you can see what is required.

The Accessibility for Ontarians with Disabilities Act, 2005(the “AODA”) requires Ontario businesses and non-profits with 20 or more employees to submit an accessibility compliance report every three (3) years. Beginning in 2014, accessibility compliance reports were required to be filed in 2017 and again in 2020, but as mentioned in our previous article, the deadline to file the 2020 accessibility compliance report was extended to June 30, 2021 by the Ontario government. With the deadline now fast approaching, organizations must review any accessibility areas they need to address in order to certify compliance with AODA requirements by this new deadline (to the extent they have not already done so).

Click here to view full article. 

Ontario Employers can now obtain their Paid Sick Day reimbursement from WSIB

If you are an Ontario employer, the WSIB site is now open to submit your claim for sick day reimbursement.  Read below for more…

This is the online application for employers, allowing businesses to be reimbursed for providing paid infectious disease emergency leave in accordance with section 50.1.1 of the Employment Standard Act (ESA), 2000.

As an employer, you may be eligible to be reimbursed for payment up to a maximum of $200 per day for up to three (3) days per employee, made to an employee for paid infectious disease emergency leave taken under subsection 50.1.1(1.2) of the ESA.