Written By Carl Cunningham, Sara Parchello, John Gilmore, Amanda McLachlan and Archana Ravichandradeva
The Alberta Government has clarified that employees will be entitled to a 14-day leave that is unpaid if they are quarantined due to COVID-19. This retreats from a prior press release from Premier Jason Kenney on March 13, 2020 stating that the leave would be paid. As a result, the current amendments to various employment standards legislation continue to focus on job protected leaves instead of an entitlement to a paid leave. Additionally, the Ontario government released details of the legislation governing its unpaid job-protected leave. Our updated blog is below.
Businesses across Canada have been hard hit by the COVID-19 pandemic. With the Dow Jones having had its biggest point drop in history on March 16, and the TSX down by almost 10 percent, many businesses across industries have been left reeling from investor uncertainty arising from the current state of the economy, reduced customer demand (and therefore revenue), and increasing pressure to reduce operations to support efforts to increase social distancing among customers and employees alike.
In this update to our series of blogs on COVID-19 responsiveness, we consider the difficult questions facing businesses regarding the continuity of their operations in the face of revenue challenges, as well as steps that may be taken to protect themselves, employees and their bottom line during these uncertain and trying times.
Are companies required to pay employees if they are sick or under quarantine?
In most provinces there is a difference between an employee's right to a statutory job-protected leave and a potential contractual entitlement to pay during a period of sickness or quarantine. However, in these extraordinary times, many employers are considering paying staff during a quarantine period even if the employee is not strictly entitled to a sick leave benefit.
Under applicable employment standards legislation, employees are generally entitled to a certain number of days of unpaid (but job-protected) sick leave. For example, in Ontario the Employment Standards Act, 2000 (Ontario ESA) provides that all eligible employees are entitled to three days of unpaid sick leave for every calendar leave, as well as three days of unpaid family responsibility leave relating to an illness, injury or emergency concerning a family member. If the condition worsens, there may be a right to a longer critical illness leave.
On March 18, 2020, the government of Ontario amended the Ontario to include a new section on leaves due to an "infectious disease emergency". This unpaid and job-protected leave is open to employees who are:
- under individual medical investigation, supervision or treatment related to a designated infectious disease;
- is acting in accordance with an order under the Health Protection and Promotion Act;
- under quarantine or isolation implemented as a result of information or directions related to the designated infectious disease issued to the public, in whole or in part, or to one or more individuals, by a public health official, a qualified health practitioner, Telehealth Ontario, the government of Ontario, the government of Canada, a municipal council or a board of health;
- under a direction given by their employer in response to a concern of the employer that the employee may expose other individuals in the workplace to the designated infectious disease;
- providing care or support to select individuals because of a matter related to the designated infectious disease (this includes providing care to children due to school or day care closures); or
- affected by travel restrictions related to the designated infectious disease and, under the circumstances, cannot reasonably be expected to travel back to Ontario.
While employees do not have to provide a medical certificate to access this leave, employers are enabled to ask for evidence "reasonable in the circumstances".
On March 17, 2020 Alberta amended its Employment Standards Code to include an Employment Standards (COVID-19 Leave Regulation), which provides an unpaid 14-day leave to employees who are in self-isolation or self-quarantine as a result of COVID-19. There is no requirement for the employee to provide written notice before commencing this leave, and the leave may be extended if necessary.
On March 17, 2020, the B.C. government also announced that it is looking to amend its Employment Standards Act to enable greater worker support as the spread of COVID-19 shutters businesses and facilities; however, no details have been formally introduced at this time.
On March 17, 2020, the government of Saskatchewan amended the Saskatchewan Employment Act to guarantee access to unpaid-protected leave to employees during the COVID-19 pandemic, which the province has deemed a "public health emergency".
Employers must be vigilant in requiring employees who may present a risk in the workplace to self-isolate. In addition to providing direction to employees exhibiting symptoms of COVID-19 of the need to quarantine or self-isolate themselves, employers should remind employees of any available sick-leave benefits pursuant to his or her contractual entitlements. It is important to ensure that employees who are sick or required to self-isolate are aware of potential paid sick-leave benefits available to reduce the risk of potentially ill employees attending at work for fear of potential financial hardship. This is a further reason many employers are opting to pay employees who are required to quarantine, even in the absence of a contractual duty to do so.
If your business does not offer paid sick-leave, it may still be prudent to consider other entitlements that may assist employees in guarding against financial hardship, such as available vacation pay or flex-time arrangements.
Additionally, for employees who are not eligible for a paid leave from their employers, the federal government announced on March 18, 2020, that it would introduce the Emergency Care Benefit. This will provide up to $900 bi-weekly for up to 15 weeks as income support to workers who are quarantined, sick, providing childcare, or providing care to those who are sick, and who do not qualify for sickness benefits under Employment Insurance. Application for this benefit will be available in April 2020, and will be administered through the Canada Revenue Agency.
Can companies force employees to go home?
Employers should focus on all available opportunities to allow employees to tele-work, wherever possible. If an employer has reasonable concerns about an employee's health status that are consistent with the most recent advice from the Public Health Agency of Canada, it may ask the individual to go home and refrain from attending at the workplace. However, any requests made in this regard must be reasonable and consistent with the need to maintain a safe and healthy environment.
What does Employment Insurance cover?
Employment insurance (EI) provides sick-leave benefit coverage for qualifying employees pursuant to the federal Employment Insurance Act. Eligible employees who face a reduction in normal weekly earnings of at least 40 percent due to illness, injury or quarantine may be eligible for up to 15 weeks of income replacement EI-sickness benefits. In order to qualify, employees must have accumulated 600 insured hours of work in the 52 weeks prior to the start of the claim.
The federal government recently announced that it would be waiving the mandatory one-week waiting period applicable to EI-sickness benefits for employees who are ill, injured or under quarantine as a result of COVID-19.
Specific details pertaining to the proposed legislative amendments have not yet been released. Accordingly, it remains unclear whether the proposed changes will apply to employees who voluntarily self-isolate or who are asked by their employers to self-isolate even though they are not ill or displaying symptoms of COVID-19 or because they have been in contact with individuals diagnosed with the virus. We expect that further details will be announced over the next few days and will provide a further update once such details become available.
Can companies reduce employee hours or pay as a result of the financial impact of COVID-19?
Employers can likely reduce employee hours and pay to counter the financial ramifications of COVID-19. While ordinarily unilateral changes to employee compensation or job requirements could lead to constructive dismissal allegations, the unprecedented nature of the current situation suggests that courts, tribunals and labour boards may show greater flexibility toward employers who are required to make difficult management decisions of this nature. We anticipate, generally speaking, that the risks arising from the implementation of decreased pay or working hours on a short-term basis will be low. However, it is important that any action taken by an employer not be punitive in nature and not be applied on an uneven basis from a human rights perspective. We recommend however that employers discuss any proposed changes with legal counsel before taking action.
What are the rules on layoffs for companies?
Companies will generally be entitled to layoff non-union employees on a temporary basis in accordance with applicable Provincial employment standards legislation if contractual language or past practice permits. There is a risk that unilateral layoffs of non-union employees may be treated as a termination of employment, which may trigger entitlement to termination pay and/or other obligations. However, given the unprecedented and novel situation facing the country, many employers may be forced to proceed with temporary layoffs protect their bottom line. Employers can mitigate the risk of a temporary layoff being treated as a termination of employment by providing advance notice (as much as possible) of the temporary layoff, and, where applicable, by continuing a substantial portion of the employees pay or benefit entitlements during the temporary layoff period.
In Ontario, the ESA permits temporary layoffs for a duration of up to 13 weeks' in any period of 20 consecutive weeks. Employers can extend this period for up to 32 weeks' in certain circumstances, including by continuing the provision of benefits.
Pursuant to Alberta's Employment Standards Code, temporary layoffs can extend for a period of up to 60 days within a 120-day period.
British Columbia's Employment Standards Act requires that a layoff may only occur if the layoff is part of an employment contract or the layoff is a normal part of the industry. Generally, a temporary layoff can extend for up to 13 weeks in any 20-week period before the layoff will be considered termination.
In many provinces, specific rules will apply to large-scale layoffs and terminations. According, it is important that you consult with your legal provider prior to implementing widespread temporary layoffs.
Do employers have to pay employees who choose to follow through on non-essential travel, now that the federal government is advising against all travel?
The Canadian government has implemented clear restrictions on all non-essential international travel. Notwithstanding the ban on travel, employees may remain entitled to pay and statutory vacation time during this time. Employers should remind employees returning from abroad that they are subject to a 14-day self-isolation period. Currently, as outlined above, only Alberta employers are required to pay employees who are subjected to a 14-day isolation.
Can an employer suspend benefit coverage for people who choose to travel if the company has advised against it? What benefits would this apply to?
As detailed above, effective March 13, 2020, the government of Canada has requested all Canadians to avoid travel outside of Canada. As of March 16, 2020, anyone, including Canadian citizens and permanent residents, who exhibits symptoms abroad will be restricted from returning to Canada. Employers should be prohibiting international travel at this time as well as any non-essential travel within Canada.
Insurers have also begun to review coverage plans in light of the pandemic. A number of insurers have adopted March 13, 2020 (the date on which COVID-19 was declared a pandemic), as the demarcation point for the rules governing out of country benefit coverage:
- If travel began prior to March 13, insurers are “generally” continuing out of country coverage, and emergency illnesses related to COVID-19 are treated as any other emergency illness. This applies to travel anywhere out of Canada.
- If the travel out of Canada started after March 13, a number of insurers will not cover emergency expenses related to COVID-19 (or for some insurers, for any reason).
- Individuals who were already out of country for non-essential travel on March 13 and whose travel coverage will expire while they remain under quarantine or travel restrictions, may be entitled to extensions of coverage depending on the terms of their plan or the insurer’s decision.
Employees exhibiting COVID-19 symptoms may be considered unfit for work for the purpose of short-term disability benefit coverage, and therefore able to access short-term benefit coverage, if applicable. Employees who are not covered through a group insurance plan could be eligible for a protected leave of absence depending on their province of residence. However, employers should be mindful of the potential for changes to be made to disability and insurance coverage eligibility in the coming weeks.
Are there additional supports for companies during this time?
- The government of Canada has announced that it will introduce enhancements to the Work-Sharing Program at an estimated cost of $12 million to help employers who are experiencing a downturn in business due to COVID-19, and their workers.
- Establishment of the Business Credit Availability Program (BCAP)— this program will support financing in the private sector through the Business Development Bank of Canada (BDC) and Export Development Canada (EDC) to provide financing and credit insurance solutions to Canadian businesses.
- Certain other programs have been implemented through BDC.
- Enhancements to the Bankers’ Acceptance Purchase Facility—this facility will provide key funding for small and medium-sized businesses.
- It is also anticipated that the federal government may take steps to reconvene the House of Commons to implement further emergency economic measures for Canadian citizens and businesses.
This post is intended to provide general information about the subject, but is not intended to provide legal advice in respect of particular circumstances. Please consult the authors or other members of the Bennett Jones Employment Services group in the event that you have employment law-related questions arising out of the COVID-19 pandemic.
This article was updated on March 19, 2020, following the release of text of the COVID-19 Leave Regulation by the Government of Alberta.