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Navigating the Legal Landscape of Temporary Layoffs: What Ontario Workers Need to Know

Navigating the Legal Landscape of Temporary Layoffs: What Ontario Workers Need to Know

byLecker & Associates | Fired, Laid-off, or Forced out , In the News

Lion Electric’s recent decision to temporarily lay off over 160 employees has highlighted the challenges businesses face in uncertain times and, more importantly, has raised significant legal questions. For employees affected by such layoffs, or those facing similar circumstances, it is essential to understand the legal framework surrounding temporary layoffs in Ontario.

What Are Temporary Layoffs?

A temporary layoff occurs when an employer suspends an employee’s work without ending their employment. Such layoffs often respond to economic downturns, supply chain disruptions, or other unforeseen business challenges. Unlike a termination, a temporary layoff is meant to be short-term, with an expectation of recalling the employee within a specific timeframe.

In Ontario, the Employment Standards Act, 2000 (ESA) governs temporary layoffs. Pursuant to the ESA, employers may temporarily lay off employees for up to 13 weeks in a consecutive 20-week period or up to 35 weeks in a 52-week period if specific conditions are met. If the layoff exceeds these timelines, it may be deemed a termination, requiring the employer to provide termination pay or severance.

Importantly, employers cannot impose temporary layoffs unless:

  • The employment contract explicitly permits layoffs;
  • Layoffs are standard practice in the industry; or
  • The employee has previously accepted a layoff with the same employer.

What Should Employees Do During a Temporary Layoff?

If you have been temporarily laid off in Ontario, here are key steps to take:

  1. Review Your Employment Contract: Check whether your contract includes a clause allowing temporary layoffs. If it does not, the layoff may amount to a constructive dismissal, entitling you to claim termination pay or severance.
  2. Request Written Documentation: Ask your employer for a written notice outlining the reasons for the layoff, its expected duration, and whether benefits will be maintained during the layoff period.
  3. Monitor Layoff Timelines: Keep track of the layoff’s duration to ensure it does not exceed ESA limits. Exceeding these limits without recall could entitle you to termination or severance pay.
  4. Seek Legal Advice: Consult an employment lawyer to understand your rights and assess whether your layoff constitutes constructive dismissal.

Government Support

If you are temporarily laid off, you may qualify for various support programs, including:

  • Employment Insurance (EI): Eligible employees can apply for EI benefits to receive temporary income support. Prompt application is crucial to avoid delays.
  • Employer-Provided Benefits: Some employers may choose to continue health or retirement benefits during a layoff. Confirm your employer’s policy on this matter.
  • Government Assistance Programs: Governments may introduce targeted relief programs for industries or workers affected by large-scale layoffs. Stay updated on available options.

What Happens if You Find a New Job During a Layoff?

If you secure new employment during your layoff period, it may have legal implications for your relationship with your original employer. Such implications include:

  1. Voluntary Resignation: Accepting a new job may signal that you have voluntarily ended your employment with the original employer. This could forfeit your recall rights or any potential termination pay.
  2. Mitigation of Damages: If you later pursue a wrongful dismissal claim, the income earned from your new job may reduce the damages or compensation you are entitled to.
  3. Communicate Clearly: Notify your original employer if you decide not to return. This prevents misunderstandings and ensures clarity in any future legal discussions.

Temporary layoffs, such as those announced by Lion Electric, can create significant uncertainty for employees. Understanding your legal rights and the resources available to you is essential in navigating these challenging times.

If you are facing a temporary layoff or believe your layoff violates your legal rights, our team of experienced employment lawyers are here to help. We can provide tailored advice to protect your rights, assess your entitlements, and explore your options, whether it’s negotiating a return to work or pursuing a wrongful dismissal claim.

Call 416-223-5391 or schedule a confidential and no-charge initial assessment with us. 

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I’m extremely grateful for all the help and guidance I received with my employment matter. Matthew Fisher was incredibly knowledgeable, supportive, and genuinely dedicated to fighting for me. They took the time to explain everything clearly, answer all of my questions, and guide me through every step of the process. Eslita was excellent — very responsive, organized, and proactive with communication, which made everything feel smooth and well-managed. I truly appreciate the time, effort, and care that went into my case. I would absolutely recommend Matthew to anyone who needs someone knowledgeable and committed to fighting for their rights.
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Awesome Team ⭐⭐⭐⭐⭐ "Thank you so much to Soniya Ponniah and Ashley Hussey at Lecker & Associates. You provided wonderful support, guidance, and clear communication throughout this employment law matter. Your exceptional legal counsel and strategic management led directly to a successful and highly agreeable resolution. I highly recommend your legal services. Thank you again!"
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⭐⭐⭐⭐⭐ Excellent Employment Law Firm I had an excellent experience working with Lecker & Associates regarding an employment matter. From the beginning, I was treated with professionalism, respect, and genuine care. I would especially like to thank Ms. Soniya Ponniah and Ashley Hussey for their outstanding guidance, communication, and support throughout the entire process. They took the time to answer my questions, kept me well informed, and made sure I understood each step along the way. Their professionalism and attention to detail gave me confidence that my matter was in capable hands. What stood out to me most was how responsive, knowledgeable, and respectful they were. Dealing with an employment matter can be stressful, and having experienced professionals supporting and guiding you makes a significant difference. I am extremely grateful for the service I received and would confidently recommend Lecker & Associates to anyone seeking professional and knowledgeable employment-law assistance. A sincere thank you to Ms. Soniya Ponniah, Ashley Hussey, and the entire Lecker & Associates team for your exceptional service, professionalism, and support.
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Mr. Whittingham has incredible to work with regarding my employment matter. I have been thoroughly impressed by his legal knowledge, insight, professionalism and strategy. He’s been instrumental in helping me navigate my issue. Nathan has helped me every step along the way while we traverse the case. Ultimately helping me find a tailored legal solution that best fits my case. I can’t recommend Nathan Whittingham enough along with the rest of the Lecker and Associates team. Thank you for helping me navigate this stressful legal situation.
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I had the pleasure of speaking with Nathan Whittingham regarding my previous employment experience. He was very helpful and understanding of the issues I am facing, and he provided valuable advice on several related topics. I would be very pleased to have him represent me as my paralegal in the future.
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I highly recommend Ian Hurley, Nathan Whittingham and the team at Lecker & Associates. After having a terrible experience with my previous counsel from another law firm, I approached Ian with recommendation from a friend. Ian and his team graciously agreed to take over my case. Ian demonstrated that he truly understood and cared about my situation and provided clear and reasonable advice. He and his team handled everything with patience, efficiency, and professionalism. They set realistic expectations and delivered. Within less than 3 months, Ian was able to reach an acceptable settlement when it took my previous lawyer over a year to get nowhere. I'm truly grateful to Ian, Nathan and his team for helping me move forward and finally put a difficult chapter behind me. I would recommend Lecker & Associates to anyone who's in need for a professional, knowledgeable, and dedicated legal team.
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