Employees should not assume that their employer can lay them off as there are several decisions from the courts that state layoffs should not be used by employers unless it can be demonstrated that an employee has contracted for this with the employer (either directly or indirectly). Specifically, unilateral and fundamental changes to the terms of employment are generally illegal without an employment agreement, and usually, this in and of itself is insufficient without adequate compensation and/or notice.
Having said this, many employers initially relied on the “layoff” during the COVID-19 era. In proceeding this way, many employers likely decided to lay off employees in the hope that either the employees will agree with (and they can then argue that there was no dispute about the legality) or alternatively, a court will sympathize with employers because of the unforeseen nature of COVID-19 and its dramatic impact on the economy.
The reality is that employees can equally (and reasonably) argue that they should not be the ones to suffer as a result of the downturn and that this is a critical time for employees to receive termination pay to support their families through this extraordinarily difficult time. This is particularly the case since there is no telling how long it will take for an employee to find comparable employment in the COVID-19 era and termination pay is specifically intended to help employees during difficult transitionary periods (and to provide greater support when comparable employment is not plentiful).
The bottom line is that an employee should not assume that an employer has an unrestricted right to lay off employees and, in fact, being laid off may be viewed as an unjust removal of employees’ rights to economic support.
It is important to note, however, that on May 29, 2020, the Government of Ontario introduced Ontario Regulation 228/20 – Infectious Disease Emergency Leave. This Regulation automatically converted temporary layoffs occuring from March 1, 2020, onwards to a job-protected leave.
During the leave, the timelines for temporary layoffs as set out under the ESA do not apply as employees are considered to be on a job-protected leave and not a temporary layoff. This leave applies during the duration of the COVID-19 Period, which is expected to end on July 3, 2021. Beginning on July 4, 2021, treatment of legislation in relation to temporary layoffs and constructive dismissals will resume as previously applied before COVID-19.
Finally, and assuming a layoff is deemed to be legal, if an employer does not return the employee to work within the timeframe allowed for under the law in the relevant province (and comply with any other conditions relating to the layoff) then the employer automatically becomes liable for termination pay.
If you have concerns regarding your employer and how they have handled your employment during COVID-19, or if you believe you have been wrongfully dismissed or any other questions, please contact Toronto employment lawyers, Sultan Lawyers at 416-214-5111 or via email at firstname.lastname@example.org.