With Ontario's first Family Day on February 18, 2008, employers must decide how they will deal with this new statutory holiday and communicate their decision to employees and customers alike. Family Day falls on the third Monday of every February and is the ninth paid public holiday under the Employment Standards Act, 2000 (ESA).
The starting assumption is that you will need to provide your employees with another paid public holiday (i.e., in addition to New Year's Day, Good Friday, Victoria Day, Canada Day, Labour Day, Thanksgiving Day, Christmas Day and Boxing Day). However, depending on how many paid holidays you currently provide your employees, and depending whether your business is union or non-union, Family Day need not necessarily result in an additional cost for your business.
Only employees of provincially regulated businesses in Ontario are eligible for this additional public holiday. Federally regulated employers that are subject to the Canada Labour Code (e.g., banks, telecommunications) have no legal obligation to provide their employees a paid day off on Family Day.
Certain professions (e.g., police officers) are exempt from parts of the ESA and accordingly may not be not entitled to a paid day off on Family Day.
Assuming the ESA applies, employees will generally qualify for public holiday entitlements unless they fail without reasonable cause to work their entire shift on (1) their last regularly scheduled days of work before or after the public holiday (i.e., the last and first rule) or (2) the public holiday if they agree to or are required to work that day.
Employers cannot contract out of the ESA, but you are permitted to provide a greater right or benefit in a contract of employment that will apply instead of the minimum standards of the ESA. Ever since the government announced the creation of Family Day, there has been significant discussion about whether employers who offer employees 10 or more paid holidays per year can require employees to work on Family Day. The answer will vary depending on factors such as the specific terms of your employment contracts/collective agreements, whether your employees are union or non-union and how many paid holidays you currently provide your employees. That said, below is a high-level review of whether you are required to provide a paid day off as Family Day based on how many paid holidays you currently provide employees:
If you currently provide employees with 8 paid holidays (the statutory minimum number of paid holidays prior to the introduction of Family Day), you must recognize Family Day as a paid public holiday.
If you currently provide employees with 9 paid holidays (the new statutory minimum following the introduction of Family Day) that means you are providing either a “floating” holiday or paying for a non-statutory holiday such as Civic Holiday or Remembrance Day. If providing nine paid holidays, you are not providing a “greater” right or benefit for the purposes of the ESA and the company must recognize Family Day as a paid public holiday. However, if you want to avoid the cost of providing your employees with an additional paid public holiday you can review your contracts, collective agreements and/or policies to determine if there are any restrictions on your ability to (1) unilaterally assign a “floating” holiday to be taken on Family Day; or (2) stop paying employees for a non-statutory holiday employees currently receive (e.g., Civic Holiday in August). If you adopt this course of action, be sure to think about the employee relations aspects of the decision to unilaterally re-assign the “extra” paid holiday.
If you currently provide your employees with 10 or more paid holidays you are arguably already providing a “greater” right or benefit to your employees and may not be required to recognize Family Day as a paid public holiday. Employers need to carefully consider whether there are any contractual restrictions (i.e., employment contracts, collective agreements, policies) which restrict their ability to argue the employer already provides employees with a greater right or benefit.
Based on arbitration decisions interpreting collective agreements and the prior version of the ESA, some employers will advise their employees that they are not required to recognize Family Day. In our view, employers should not just assume that this means there is no risk if they advise their employees that they are not entitled to Family Day. First, based on the provisions in the ESA that grant unions the right to act as the employee's agent for the purposes of entering into agreements, there may be a distinction between union and non-union employees. A collective agreement may require the union's agreement to any issues related to changes in paid holidays. Second, portions of the ESA dealing with the greater right or benefit concept have been amended since several arbitration decisions on this issue were decided (such as, National Steel Car (1990), 10 LAC (4th) 353 and Boise Cascade Canada Ltd., [1992] E.S.C. No. 3109). Third, while 10 paid public holidays seems to be a greater right than 9 paid public holidays, it may be argued that the purpose of this amendment is to provide an opportunity for the employee to be off with his/her family. If that purpose cannot be achieved (e.g., a day off when their family is off ), then there may not be a greater right. In summary, this issue is likely to be the subject of several grievances and/or employment standards complaints in the next few months and there is some merit in waiting to see how the greater right or benefit argument is interpreted prior to taking an aggressive position.
Finally, regardless of a potential exception to the obligation at law to provide employees with Family Day, employers also need to consider whether that is an appropriate decision from an employment relations perspective. Family Day has generated significant media attention and there could be a potential deterioration in employee morale if employees do not receive Family Day off with pay. Accordingly, this is an appropriate time to communicate with your employees. If you are providing employees with the day off with pay, try to use this as an opportunity to earn some goodwill. Conversely, if you will require employees to work on Family Day we recommend reminding employees about the greater right or benefit they receive (e.g., 10 paid holidays instead of 9 paid holidays) and explaining the business reasons (e.g., demands of federally regulated clients such as banks) for why your company must operate on Family Day. Given that February 18, 2008, is President's Day in the United States of America, the holiday is unlikely to cause any problems for your customers there.
Family Day is quickly approaching. If you have not yet reviewed your employment contracts, collective agreements and/or policies regarding public holidays, now is the time to do so. Employers need to decide whether or not any of those documents need to be revised or re-negotiated. In addition, communications to employees, and potentially customers, need to be considered. If you have any questions regarding whether your employees qualify for public holiday pay, whether they are required to work on public holidays, how to calculate public holiday pay, or any other employment matters, the lawyers in our employment services practice would be pleased to assist you.