If you are an employee that was placed on leave at the beginning of the pandemic, you may still find yourself in a state of limbo, in which your employment status is uncertain. Similarly, if you are an employer that placed employees on leave for reasons related to COVID-19, many of those employees could still, years later, be willing to return to their jobs. However, on July 30, 2022, some of this uncertainty will end, and employees and employers alike will need to make decisions on the status of their employment relationships.
This uncertainty stems from the Infectious Disease Emergency Leave (“IDEL”), a regulation under the Employment Standards Act, 2000 (“ESA”), enacted by the Ontario government in the early days of the pandemic. IDEL provides, among other things, that a temporary reduction or elimination of an employee’s wages or hours of work by the employer, for reasons related to the pandemic, does not constitute a layoff or constructive dismissal, provided it occurs during the “COVID-19 period”. As a result, many layoffs were retroactively converted into leaves under IDEL.
Under IDEL, the “COVID-19 period” began on March 1, 2020, and while the end date was extended several times, it is currently scheduled to end on July 30, 2022. At this time, it does not appear that the end date will be extended further.
Therefore, by July 30, 2022, the deeming provisions of IDEL will come to an end. If you are an employee who was placed on IDEL, you need to decide whether you would wish to return to your position if you are recalled by your employer. If you are an employer who had placed employees on IDEL, you cannot simply do nothing when the “COVID-19 period” ends, as this could expose you to significant liability. Therefore, you have an important decision to make about the status of those employees:
- will you terminate their employment,
- recall them to work, or
- will you attempt to place those workers on a temporary layoff to give the organization more time to decide on their permanent status?
As the end of IDEL is approaching fast, these are questions that need to be assessed now, ahead of July 30th.
Some considerations about the end of IDEL are discussed below:
Recalling an Employee from IDEL
An employee can be recalled from IDEL in a manner similar to recalls from layoff. As a matter of best practice, recall notices should always be given in writing, and should clearly indicate the date the employee is expected to return.
If an employee is recalled but refuses to return, this may constitute a resignation from their employment. In such circumstances, it is advisable to seek legal advice to ensure that the matter is handled appropriately and that the employer’s actions could not be construed as dismissing the employee.
More information about recalling employees from layoffs can be found here.
Terminating an Employee who was placed on IDEL
An employer may choose to dismiss an employee who had been placed on IDEL, without cause, by providing the employee with reasonable notice or pay in lieu thereof. This includes the employee’s minimum statutory notice under the ESA, and Severance Pay if applicable. As well, the employee will be entitled to reasonable notice under common law, unless there is an enforceable employment contract that defines or limits the employee’s entitlements upon termination (recent developments in this area of law can be found here and here).
Further information on an employee’s entitlements upon termination can be found here.
Placing an Employee on Layoff
A further option is to transition from IDEL to a temporary layoff, beginning on July 30, 2022, to give the employer more time to decide on their permanent status.
However, it is important to note that such a layoff would not be protected under the IDEL regulation, and unless there is an agreement to the contrary, it could be construed as constructive dismissal. As found by the Ontario Court of Appeal in Elsegood v. Cambridge Spring Service (2001) Ltd.:
At common law, an employer has no right to lay off an employee. Absent an agreement to the contrary, a unilateral layoff by an employer is a substantial change in the employee’s employment, and would be a constructive dismissal.
The Limits of IDEL
Even if an employee is recalled and returns to work, they may still have a claim against their employer for their lost wages during the period that they were on IDEL. Similarly, if an employee resigns from their employment and/or accepts a new position elsewhere in response to being placed on IDEL, they may have a claim against their former employer for constructive dismissal.
This is due to the fact that while IDEL certainly applies to constructive dismissal under the ESA, it is unclear whether it applies to constructive dismissal under common law. As we have written about previously, there are conflicting Court decisions about this issue. The one “employer-friendly” decision on this issue was recently overturned by the Court of Appeal on procedural grounds. However, the Court of Appeal declined to rule on the critical issue – whether or not leave under IDEL constitutes constructive dismissal under common law.
As it currently stands, there are two Court decisions stating that leave under IDEL constitutes constructive dismissal under common law, and no upheld decisions stating otherwise. Nonetheless, we will not have full clarity on this issue until there are further Court rulings.
Certain IDEL Provisions Still in Effect
Finally, it is important to note that certain provisions of the IDEL regulation will continue to be in effect after July 30, 2022. Employees who are unable to work for reasons related to COVID-19 will continue to be entitled to unpaid leave, similar to other statutorily protected leaves pursuant to the ESA. However, after July 30, 2022, all entitlements to paid leave for reasons related to the COVID-19 pandemic will end.
Conclusion
Whether you are an employee or an employer, you may have some big decisions to make with the upcoming end of IDEL’s “COVID-19 period”. If you are an employee, we can help you navigate what to do if your employer asks you to return to work, or if they keep you on leave past the end of the period.
If you are an employer that placed employees on IDEL, you cannot simply do nothing when the “COVID-19 period” ends on July 30, 2022, as this could expose you to significant liability. We can help you with implementing difficult and sometimes complicated decisions about the status of your employees.
If you have any questions about your situation or if you would like to get legal advice, please feel free to contact us.
