This seventh series of FAQ about employment law during COVID-19 addresses questions surrounding terminations of employment.
Is it legal for an employer to terminate employment during COVID-19?
Yes. This pandemic has not altered an employer’s fundamental right to terminate an employee’s employment for any reason.* If a termination is done on a without cause basis, employers still must provide notice of termination or pay in lieu of notice, and severance pay, if applicable. This is often referred to as the severance package.
*There are some reasons that, if relied upon for termination, would be illegal. These include discrimination (human rights) or reprisal for employees asserting their workplace rights.
Can an employer terminate an employee for COVID-19-related reasons?
No. The Ontario government amended the Ontario Employment Standards Act to include COVID-19 protections. These protections prevent an employer from terminating someone’s employment, and include employees who are being tested for COVID-19, are taking care of someone who has COVID-19, are taking care of someone otherwise affected by COVID-19 (like children), and others. These protections allow the employee to take an unpaid leave of absence from work until the pandemic is over or their specific situation for taking a COVID-19 related leave is over.
If the reason is strictly related to a downturn in business due to COVID-19, then it is legal for an employer to dismiss an employee by providing a severance package.
How does discrimination/human rights affect terminations during COVID-19?
The Ontario Human Rights Code will always apply to employment terminations in Ontario. The Code provides that employers cannot consider a prohibited ground such as employee’s age, sex, disability, or race when it decides to terminate an employment relationship.
In addition to the protections provided by the Employment Standards Act, employees are protected by the Code during COVID-19. For example, if COVID-19 is considered a disability, then an employer would not be permitted to dismiss an employee because they have COVID-19. Further, if an employee has parental obligations that require them to work from home, an employer may not be allowed to terminate their employment for refusing to work at the office.
How does health and safety affect terminations during COVID-19?
Due to the health and safety considerations that this pandemic has brought to Ontario, employers and employees need to be aware that employees have the right to refuse unsafe work under the Ontario Occupational Health and Safety Act. Terminating an employee for raising a health concern at work, including improper protection from COVID-19, is illegal.
Does being terminated during COVID-19 give an employee a larger severance package?
Potentially.
No - if an employee has an employment contract that contains an enforceable termination clause, then COVID-19 would not affect how much notice or severance they are entitled to upon termination.
Yes - if the employee does not have an enforceable termination clause in their contract, they are entitled to notice of termination under the common law. As notice under the common law is supposed to be the length of time it takes for a dismissed employee to find comparable work, this notice period would likely be longer if someone is terminated during the pandemic.
What should an employer consider when thinking about terminations?
As many companies take a serious look at their workforce in this challenging economy, employers must consider each employee’s situation and ensure that when it comes to terminations, they do not consider any illegal reasons.
What should an employee consider when they have received a severance package?
The legal considerations remain largely the same when considering whether to accept a severance package, which is mainly whether the termination clause in the employment contract is enforceable. Here is a helpful guide to calculate how whether a severance offer is fair or not.
Jason Wong is a Toronto Employment Lawyer practicing exclusively employment, labour, and human rights law. If you are an employee or employer who has questions about employment terminations during COVID-19, please contact Jason at jason@wongemploymentlaw.com or 647-242-5961.