Major changes coming to the Canada Labour Code

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Employment Alert

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The Canada Labour Code (“the Code”) prescribes the minimum labour standards for federally regulated workplaces. On October 29, 2018, the Federal Government introduced in First Reading Bill C-86, in order to amend a number of provisions of Part III of the Code. Bill C-86 received Royal Assent on December 13, 2018, and thus began the so-called “modernization” of the Code. The amendments will likely come into effect by the end of 2019, though the timeframe is not entirely clear at this point.

The amendments are to the benefit of employees, with increases in leave provisions, termination notice and vacation pay, and the implementation of an equal pay rule. A general overview of some of the key amendments to the Code are detailed below:

Termination

The individual notice of termination requirements have been increased. The current notice periods will be replaced with the following:

Continuous Service Requirement

Notice Period

3 months of continuous service

2 weeks’ notice

3 years of continuous service

3 weeks’ notice

4 years of continuous service

4 weeks’ notice

5 years of continuous service

5 weeks’ notice

6 years of continuous service

6 weeks’ notice

7 years of continuous service

7 weeks’ notice

8 or more years of continuous service

8 weeks’ notice

 

Vacation pay

Vacation pay entitlements have been increased, and the current vacation pay entitlements will be replaced with the following:

Continuous Service Requirement

Vacation Entitlement

1 year

2 weeks’ vacation or 4% vacation pay

5 years

3 weeks’ vacation or 6% vacation pay

10 years

4 weeks’ vacation or 8% vacation pay

 

Leaves of absence

Personal Leave: Employees will be eligible for five days of personal leave, with the first three days being paid (after three months of continuous employment), in the following circumstances:

  • treating personal illness or injury;
  • carrying out responsibilities related to the health or care of any of their family members;
  • carrying out responsibilities related to the education of any of their family members who are under 18 years of age;
  • addressing any urgent matter concerning themselves or their family members;
  • attending their citizenship ceremony under the Citizenship Act; and
  • any other reason prescribed by regulation.

Medical Leave:  Employees will be eligible for up to 17 weeks unpaid leave in the following circumstances:

  • personal illness or injury;
  • organ or tissue donation; and
  • medical appointments during work hours.

In the event an employee is absent for three days or longer, the employer may require a certificate issued by a health care practitioner certifying that the employee was incapable of working for the period of time in which they were absent from work. The pension, health, disability benefits and seniority of an employee who is absent by reason of medical leave continue to accumulate during the entire period of the medical leave. 

Victims of Family Violence: This leave has been amended to provide that the first five days of leave for victims of family violence must be paid after three months of continuous employment.

Continuous Service Requirements: Employees will no longer be required to have completed six months of continuous service with their employer before being entitled to maternity leave, parental leave, a leave related to the death or disappearance of a child, or a leave related to critical illness.

Continuous employment

The current continuous employment provisions will be expanded to provide for continuous employment where an employee is employed in connection with the operation of a work, undertaking or business both before and after a lease or transfer from one employer to another, if the work, undertaking or business is federal, or if it becomes federal due to the lease or transfer. Furthermore, if due to a contract being awarded through a retendering process, a second employer becomes responsible for carrying out any federal work, undertaking or business that was previously carried out by the first employer, an employee who was employed in relation to the operation before and after the retendering is deemed to be continuously employed with one employer.

The Pay Equity Act

Bill C-86 seeks to introduce new legislation known as the Pay Equity Act. This Act would require all federally regulated employers with 10 employees or more to provide male and female employees with equal pay for work performed which is of equal value. This rule will apply unless there are objective reasons to justify a differential wage rate, such as employee seniority and length of service, geographic location or the existence of a merit-based compensation plan. Upon employee request, an employer will also have to offer a written justification detailing the difference in wage rate. Employers are further required to establish and maintain a pay equity plan.

The Pay Equity Act will create the position of Pay Equity Commissioner, who will have jurisdiction to monitor the implementation of and compliance with the Act, and authority to conduct or order compliance audits or investigations.

Rest periods

Employees will be entitled to an unpaid 30-minute break during every work period of five or more consecutive hours, except in case of emergency. Employers will also be required to provide a rest period of at least eight hours except in the case of emergency. An employee will further be entitled to any unpaid break necessary for medical reasons or for an employee who is nursing to nurse or express breast milk.

Right to refuse overtime

Under this amendment an employee may refuse to work overtime where such overtime conflicts with a “family responsibility”, defined as the health or care of a family member or the education of a family member who is less than 18 years of age.

Bill C-86 will result in the most significant changes to the Code seen in decades and will be sure to have an effect on employers. The DLA Piper (Canada) Employment team will continue to keep you updated on further developments and the possible impact on your organization.

This article provides only general information about legal issues and developments, and is not intended to provide specific legal advice. Please see our disclaimer for more details.