What do Ontario's new layoff regulations mean for you?

job application

The province has announced a temporary change to its labour laws to help businesses avoid permanently laying off workers and paying out severance.

"Terminations triggered when temporary layoffs exceed the permitted length under the Employment Standards Act can result in costly payouts which, for many businesses, could be the difference between survival and closure," the province says in a news release.

The ESA requires businesses to terminate employees who have been laid off for 13 weeks without benefits,  or 35 weeks with benefits, and requires the business to pay severance.

But under this new change, layoffs related to COVID-19 are no longer considered layoffs. Instead, they are Infectious Disease Emergency Leave.

The amendment to the law will expire six weeks after the province's declared state of emergency ends.

Employment Lawyer Howard Levitt of Levitt LLP says the change means the layoff clock doesn't start until that six weeks is up.

"So, employees who were on what they thought would be a 13 week layoff, it might end up being a many-month layoff," he explains.

However, he says this change does not stop workers from taking their employer to court for severance pay.

"If anything I think this incentivises employees to claim constructive dismissal in terms of their wrongful dismissal damage rights, in other words in a court context rather than an employment standards context, that much more quickly."