A Primer on IDEL Legislation. Wrongful Dismissal or Layoffs
In response to the health and economic effects of the COVID-19 Pandemic, the Ontario government introduced Infectious Disease Emergency Leave (“IDEL”) legislation on June 1, 2020. It allowed employees, who were affected by COVID-19 illness, to pursue a protected leave of absence while tending to their health or to the health needs of a loved one. While innocuous, IDEL also gave employers the right to unilaterally declare extended layoffs if the business required it for pandemic-related reasons.
Prior to the introduction of IDEL, so long as an employee condoned layoffs forming an essential component of the employment relationship (such as by way of signing an employment contract which included a layoff provision, or agreeing to being placed on layoffs on previous and regular occasions), the Employment Standards Act, 2000 (the “ESA”), only allowed employers to conduct temporary layoffs for 13 weeks maximum.
The ESA does permit employers to extend a layoff to a maximum of thirty five (35) weeks, however, employers first needed to meet very stringent technical requirements to subject an employee to such an extended temporary layoff (for example, continuing any existing benefits over the extended layoff period, and ensuring the employee is in receipt of Employment Insurance or other related unemployment assistance).
The ongoing pandemic left the province locked down and without a clear plan for reopening the economy, with thousands of employees subject to temporary layoffs which were set to expire, as the pandemic dragged on throughout 2020. This put employers between a rock and a hard place.
We were, therefore, neither surprised with the timing of IDEL legislation nor the provisions that allow employers to unilaterally conduct extended layoffs during the pandemic. The Government originally set IDEL to expire on September 4, 2020, but extended IDEL on a number of occasions, most recently to conclude on or before January 1, 2022.
Employees on IDEL are not considered terminated. You are therefore not entitled to ESA termination and severance entitlements or any other forms of compensation from employers. And the legislation includes hurdles for anyone who might challenge the layoff as constructive dismissal.
Extended Layoffs Emboldening Employers
At a glance, all of this looks like a step backwards for employee rights in Ontario. Unsurprisingly, it has emboldened some employers to take the spirit of the law beyond its intentions. A few have brazenly attempted to conflate extended layoffs with terminations, counting on employees not knowing any better. Since the Government introduced IDEL, we have witnessed an infuriating rise in illegal layoffs and wrongful dismissals in Ontario.
Incredibly, even some in the legal community have jumped on this bandwagon to opine that employers could technically subject an employee to an extended thirty-five (35) week layoff upon the conclusion of the IDEL in January, leaving employees hanging out to dry until late 2022! In our opinion, this would not only be disingenuous, it would also be quite short-sighted. We caution any employer considering this strategy to think twice. IDEL may have some provisions that work in your favour, but the ESA still protects employees in powerful ways.
Protections for Employees on Extended Layoff
First of all, the legislation has made IDEL a “protected leave.” Employers should not gloss over this salient point. Just like maternity and sick leave, this entitles employees to reinstatement upon return. Anyone let go during or shortly after returning from such leaves of absence have strong cases for remedial action. The Ministry of Labour has not hesitated in the past to issue orders of reinstatement along with back-pay in wages. Asking employees to forego their right to reinstatement can succumb employers into paying out expensive severance packages and legal bills.
Secondly, employers may only rely on IDEL for pandemic related reasons. You cannot place workers on extended layoffs, while the business continues to operate, and even thrive, with a new crew at the helm.
And finally, employers who find themselves in dire straits can legally terminate employees during these times. IDEL temporarily obstructs employees from seeking their ESA mandated minimum entitlements. However, Ontario employees always received a second layer of protection under our precedent based common law legal system. Based upon thousands of judgments by the courts, judges have routinely issued decisions which have evolved employee’s right in addition to their minimum protections and entitlements afforded under the legislation. We have consistently relied on the common law to secure the maximum entitlements for our clients. Almost always, it vastly exceeds ESA provisions. This remedial avenue remains unaffected by IDEL, and available to terminated employees, presently.
In fact, in the two landmark decisions of Coutinho v. Ocular Health Centre Ltd 2021 ONSC 3076 and Taylor v. Hanley Hospitality Inc. o/a Tim Hortons, 2021 ONSC 3135, the Courts confirmed the prevailing theory of plaintiff counsel that an employee may challenge being unilaterally placed on IDEL as an unlawful layoff which is tantamount to a constructive dismissal, thereby entitling them to common law reasonable notice of dismissal (i.e., severance pay).
This was welcome news to employees, as it reassured them that they do not have to simply accept forcefully being placed on a temporary layoff, under the guise of it being related to the COVID-19 Pandemic without recourse. Rather, they can challenge being subject to IDEL without delay, and seek their severance.
Unfortunately, the Court in Taylor v. Hanley Hospitality Inc. o/a Tim Hortons, 2021 ONSC 3135 reached an opposing conclusion, and ruled that as a result of the IDEL legislation, placing an employee on IDEL is not akin to a constructive dismissal. We understand, however, that this decision is being appealed to the Ontario Court of Appeal, where we are hoping the Ontario Court of Appeal will “settle the score” and issue a binding verdict, reaffirming an employee’s right to challenge being subject to IDEL as a constructive dismissal, entitling them to severance pay.
Employee Due Diligence During Extended Layoffs
Employees put on extended layoffs under IDEL should apply for federal government financial assistance programs right away. Contact us if you are facing hurdles with getting a Record of Employment from your employer. If you suspect something is not right about your layoff, then the most helpful thing you can do for yourself is to contact us for clarity. We can review your circumstances and advise you of your rights.
Do not wait until after IDEL expires to see what happens. Unfortunately, employers who treat workers unfairly follow a predictable set of behaviours. If you have a case, then we can use the time to guide you so we can file an airtight case without delay when IDEL expires. For example, we will counsel you to remain in regular contact with your employer about your employment status and recall date. This due diligence will help us establish that you did not willingly accept the layoff, a fundamental requirement for determining whether yours was lawful.
These are precarious times for employees, and the latest IDEL extension will arrive as a nasty slap in the face. If you understand your rights, you can level the playing field with your employer. And we can help you in this regard.
