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By Peter Menyasz
Ontario has proposed a broad overhaul of its employment standards and labor relations law, including an increase in the minimum wage to C$15 ($11.10) an hour, equal pay for equal work for part-time and temporary workers, and expanded access to card-based certification of union bargaining units.
Bill 148, the Fair Workplaces, Better Jobs Act, would significantly update the province's Employment Standards Act and Labour Relations Act, including a two-stage increase in the minimum wage that would be completed by Jan. 1, 2019. Most of the bill's provisions would take effect on Jan. 1, 2018.
The historic legislative update will improve working conditions, particularly for vulnerable employees, during a time when the province's economy is booming but workers are struggling to support their families on part-time, contract, or minimum wage work, the provincial government said June 6.
“These changes will ensure every hard-working Ontarian has the chance to reach their full potential and share in Ontario's prosperity,” Labour Minister Kevin Flynn said in a statement. “Fairness and decency must continue to be the defining values of our workplaces.”
Bill 148 responds to the final report of the province's two-year Changing Workplaces Review, the first-ever independent review of 2000's Employment Standards Act and 1995's Labour Relations Act, the government said.
The report estimated that more than 30 percent of the province's workers were in “precarious” work in 2014, making it hard for them to earn a decent income and interfering with their opportunities for decent working conditions. Currently, more than half of the workers earning less than C$15 ($11.10) an hour are aged 25-64 and the majority are women.
Over the past 30 years, part-time work has grown to represent nearly 20 percent of total employment in the province, and in 2016 the median hourly wage was C$13 ($9.60) for part-time workers, compared to C$24.73 ($18.30) for full-time workers. The proposed legislation would provide higher pay for more than 25 percent of all workers in the province, according to the report.
The province's minimum wage is currently C$11.40 ($8.44) an hour, and the bill calls for a first-stage increase to C$14 ($10.36) Jan. 1, 2018.
The Ontario Legislature passed Bill 148 at first reading on June 1, then used a special order to have it referred for review by the Finance and Economic Affairs Committee before debate at second reading. The committee has announced hearings for June 23, July 10-14 and 17-21, and Aug. 21-25.
Labor unions welcomed the proposed employment standards and labor relations updates, while the business community warned that the proposed changes would harm the province's economy.
Unifor, Canada's largest union with more than 310,000 members of which more than 50 percent are in Ontario, called for all political parties to support the proposals and make a strong commitment to helping the province's at-need workers.
“Ontario workers have waited long enough for fairness on the job,” Jerry Dias, the union's president, said June 1 in a statement. “Basic decency at work should not be a partisan issue.”
The union said it will push for additional improvements to the proposed legislation, including simplified card check union certification for retail and fast food workers, an increase to three weeks of vacation for all workers and creation of paid leave for domestic violence survivors.
The Ontario Federation of Labour congratulated the government for its plan to increase the minimum wage and update employment standards.
“It is time to put legislation in place that will guarantee decent conditions in the workplace for all workers, as well as decent pay,” association president Chris Buckley said June 1 in a statement.
The Ontario Chamber of Commerce, however, said that Bill 148 calls for “unproven” reforms without provisions to protect against “unintended consequences” and warned that the changes would lead to job losses, higher consumer costs, and economic hardship.
Jointly with the Keep Ontario Working coalition, a group of industry associations representing various business sectors, the Chamber stressed that the government can't regulate prosperity.
“The reforms outlined in the Fair Workplaces and Better Jobs Plan thus far do not provide the balance needed to help ensure a competitive environment,” the Chamber said. “We must work cooperatively with government to identify the scale of the economic impact of these changes and help employers transition into any new policy regime.”
The legislature is in recess until Sept. 8, most of the employment standards changes are to take effect Jan. 1, 2018, and a provincial election is set for June 7, 2018, so the government will likely move quickly to adopt the bill, George Vassos, a partner with Littler Mendelson PC, said June 11.
“Likely too quickly for most employers,” Vassos told Bloomberg BNA. “All of this will likely be in place before the election in 2018.”
The Keep Ontario Working coalition has proposed that a comprehensive economic impact analysis of the proposed reforms be conducted, but it's unclear whether the government will heed its warnings, Vassos said. So far, the legislative committee is the only consultation the government has announced, he said.
There may, however, be room for employers to secure changes to some elements of the legislation, Vassos said. For example, the bill proposes requiring equal pay for equal work for temporary help agency workers, but the advisory group urged that this not be applied during the first six months of a temporary assignment.
“This is one area where the government might bend, especially if the advocacy is loud and compelling,” Vassos said.
In the meantime, it will be important for employers to provide appropriate employee training on any changes that are passed, Vassos said. Employers would also be well advised to review their existing independent contractor relationships and any potential misclassification problems, given the increased scrutiny those issues will receive, he said.
“Employers will also have to review hiring letters, employment contracts, policies, and handbooks to ensure compliance with the final amendments,” Vassos said.
The government's clear emphasis on enforcement, including the plan to hire 175 more employment standards officers by 2021, means increased scrutiny of employers, Vassos said.
“Every employer would be well advised to conduct an Employment Standards Act self-audit with respect to existing obligations even before we get to the Bill 148 amendments,” he said.
Vassos noted that the Ministry of Labour announced June 6 a 30-day jail sentence and a C$25,000 ($18,500) fine for an employer that operated two businesses in Brampton, Ontario that failed to pay 43 workers a total of C$140,000 ($104,000) in wages.
“A jail term has been rare in the past,” he said. “We may well see more of this for employers who do not pay what is owed.”
Although Bill 148 only applies to employers operating in Ontario, the proposed changes respond to a labor and employment landscape that is largely similar across Canada and may lead to similar legislative changes in other provinces, Halifax-based law firm Stewart McKelvey LLP said in an analysis of the bill.
“Alberta has already followed in Ontario's footsteps by announcing a similar labor and employment overhaul, and it is plausible that significant revisions could follow in jurisdictions across Canada,” the analysis said.
Other proposed employment standards changes in Bill 148, which would take effect as soon as the bill becomes law, include:
The government has also committed to hiring an additional 175 employment standards officers over the next five years and to setting by 2020-2021 a requirement to complete all employment standards cases within 90 days of filing.
Proposed labor relations changes, which would take effect six months after the bill becomes law, include:
The employment standards changes will have a particularly negative impact on smaller businesses, whose profit margins tend to be quite limited, which could make the updated statute a “job-killer,” Ron Minken, head of Markham, Ontario-based Minken Employment Lawyers, said June 9.
“Very much so,” Minken told Bloomberg BNA. “It might be easier not to have an employee.”
In addition, the elimination of exemptions for lawyers, accountants, and other professionals will be hard on those businesses and could lead to lower employment levels, he said.
The proposals are an election move from Premier Kathleen Wynne’s government, which in the current economic climate wanted to provide something positive for a wide range of voters, Minken said.
Sara Kauder, a lawyer with the Minken firm, said the equal pay for equal work provisions will make it much harder for smaller employers to function, since many of them depend heavily on part-time and/or temporary employees.
The wage changes also leave an open question as to whether the government will move to provide those employees with benefits similar to those of full-time employees, Kauder told Bloomberg BNA.
“A lot of people currently aren’t eligible for benefits,” she said. “If all of these categories of work are deemed to be the same, what happens with all of the other kinds of perks?”
To contact the reporter on this story: Peter Menyasz in Ottawa at email@example.com
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The text of Bill 148 is available here.
For more information on Ontario HR law and regulation, see the Ontario primer.
Copyright © 2017 The Bureau of National Affairs, Inc. All Rights Reserved.
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