Employment Standards Act Compliance
The Employment Standards Act (ESA) is the Ontario law that governs most workplaces in Ontario. The purpose of the ESA is to protect employees and provide them minimum protections. Because the ESA is not drafted very well and can be complicated at times, employers often breach the law without even knowing it.
The Ministry of Labour has wide-ranging powers to inspect and enforce the ESA, often at an employer’s expense. Liabilities can add up if an employer continues to breach the ESA. Lack of knowledge will not be a defence.
In order to manage their workforce properly, employers must ensure they are aware of all the laws of the ESA, or at least know someone who does. Here are only a few important laws with employers need to know:
Vacation with Pay: Vacation time and vacation pay are two separate things. Employers can schedule an employee’s vacation whenever they want but must apply them in one-week blocks. Exceptions apply.
Buying a Business: Employers who purchase a company, including only some assets of the company, and continue to employ the previous employees must count the employees’ previous tenure. Exceptions apply.
No Deduction from Wages: Did an employee makes a mistake? Employers cannot deduct wages because of the mistake. To deduct wages at all, employers must receive an employee’s written authorization.
Overtime Pay: Employers must pay overtime at a rate of 1.5 times an employee’s pay if they work over 44 hours in a week. Even salary employees. Exceptions apply.
Records: Employers must keep detailed records including hours worked, vacation, authorizations, etc.
Sick Leave: Employees must be given three days each year for sick leave. They can be unpaid, and employers can require reasonable evidence to support the leave. The ESA also allows pregnancy leave, parental leave, family responsibility leave, bereavement leave, and others.
Termination: When dismissing an employee without cause, employers must give a minimum amount of notice of termination, or termination pay, and severance pay if applicable. Employers could be liable to pay much more severance under the common law without proper employment contracts.
This is only a brief list. Further, the brief descriptions provided may not apply to all circumstances.
Employment Standards Officer Investigations
Under the ESA, an employee can file a complaint with the Ministry of Labour if they think an employer has breached the ESA. These are often unpaid wages or termination complaints. An ESA Officer will investigate the issue and it is vital for employers to participate in the investigation. The ESA officer can make binding orders against an employer, including issuing a fine, a notice of contravention, and an order to pay.
If an employer disagrees with an ESA Officer’s decision or their reasons for the decision, an employer has the right to file an application for review at the Ontario Labour Relations Board. At the Labour Board, an employer can overturn the ESA Officer’s decision.
Employment Standards Legal Services
ESA compliance is a critical part of managing an effective workforce. Based in Toronto, Jason Wong is an employment lawyer who regularly assists employers to make sure they understand their obligations. Employers also regularly seek his help in managing employment standards investigations and Labour Board matters. If your business requires employment standards assistance, you can reach Jason at 647-242-5961 or jason@wongemploymentlaw.com.