Canada: Bill C-86 Proposed Changes To Federal Labour And Employment Laws

Workplaces subject to the Canada Labour Code need to prepare for major changes to a range of statutory provisions governing everything from work scheduling to leave entitlements to termination of employment, among many others. The changes will begin to take effect in September 2019.

According to the Government of Canada, no less than 18,000 Canadian employers are subject to the Canada Labour Code (the "Code"). On December 13, 2018, Bill C-86, A second Act to implement certain provisions of the budget tabled in Parliament on February 27, 2018 and other measures ("Bill C-86") received Royal Assent. As a result, substantial changes to the Code concerning basic employment standards, non-standard employment relationships and terminations are to be phased in over time. Affected employers should be aware that some of these changes come into effect September 1, 2019, They should also continue to monitor the implementation dates of the rest of the changes.

Some of the key changes are described below.

Leaves

Effective September 1, 2019, there will no longer be a minimum length of service requirement for certain Code leaves (including maternity leave, parental leave, critical illness leave, leave related to death or disappearance of a child, and general holiday pay). On the effective dates noted below, new or amended leave provisions will also be introduced, including the following:

Additionally, on a date yet to be determined, Bill C-86 will introduce a parental sharing benefit to increase the amount of parental leave by up to 8 weeks if that leave is divided among two parents (this change reflects the proposed increases to parental leave entitlements under the recently updated Employment Insurance Act).

Scheduling and Hours of Work

Hours of Work

Effective September 1, 2019 there will be new employee entitlements pursuant to the Code with respect to breaks and rest periods, including:

• unpaid breaks of 30 minutes for every 5 hours of work (such breaks must be paid if the employer requires the employee to be at their disposal during the 30 minute period and the breaks are subject to postponement or cancellation in the case of an emergency);
• minimum 8 hour rest period between work periods or shifts (the rest period is subject to postponement or cancellation in the case of an emergency); and
• unpaid breaks for breastfeeding, pumping breastmilk or for medical reasons (an employee must provide evidence to support requests for unpaid breaks for medical reasons and an employer may request a written medical certificate setting out the length and frequency of such breaks).

Notice of Schedule

Bill C-86 will require employers to provide employees with a minimum of 96 hours advance written notice of their work schedule subject to emergencies. For unionized employees the terms of the collective agreement prevail. The implementation date of this change has yet to be fixed.

Vacation Pay

Effective September 1, 2019, the length of continuous service required for three weeks' paid vacation will be reduced from 6 to 5 years. After 5 years of employment, an employee will be entitled to 3 weeks' vacation and the associated vacation pay will increase to 4 weeks after 10 years of employment. Bill C-86 amends the Code to recognize the continuity of employment to calculate vacation pay entitlements and expressly references an employee's prior service with a provincially regulated entity that becomes subject to the Code as a result of a sale of the business. Additionally, a new "retendering of contract" provision in Bill C-86 will recognize service if an employee continues to perform work for a contractor that becomes subject to the Code.

Termination of Employment

Individual Termination

The current termination of employment provisions of the Code, which provide for 2 weeks' notice of termination, will be replaced on a date to be determined with a graduated notice system similar to the scheme found in most provincial employment standards' legislation. Depending on the number of years of continuous service, employees who have completed at least 3 months of service will be entitled to between 2 and 8 weeks written notice of termination, pay in lieu of notice at their regular rate of wages for their regular hours of work, or some combination thereof.

Group Termination

Pursuant to the Code, employers are required to give notice of individual termination, as well as group termination in the event that 50 or more employees from a single industrial establishment are dismissed within a 4-week period. On a date to be determined – but not sooner than September 1, 2019 – Bill C-86 will supplement the existing requirement to provide up to 16 weeks of written notice to the Minister and employees (and to a trade union if any) with a concurrent requirement to provide affected employees at least 8 weeks' notice, pay in lieu of notice, or a combination thereof.

Unjust Dismissals

We also note that recent changes to the Code arising from a separate piece of legislation, Bill C-44, An Act to implement certain provisions of the budget tabled in Parliament on March 22, 2017 and other measures ("Bill C-44"), received Royal Assent on June 22, 2017. These changes recently introduced an avenue for employees to complain about reprisals or threats by an employer to be dismissed, suspended, laid off, demoted, disciplined or otherwise penalized for:

• exercising or seeking to exercise rights under Part III of the Code (which cover hours of work, wages, vacations, and holidays);
• making a complaint under Part III of the Code;
• providing information to the Minister or inspector in exercise of their Part III powers, duties, and functions; or
• testifying or planning to testify in a proceeding under Part III.

Additionally, while unjust dismissal claims are currently referred to adjudicators, Bill C-44 transferred the powers, duties and functions of adjudicators to the Canada Industrial Relations Board (the "Board").

Bill C-86 will impact the complaint mechanism in place for complaints of unjust dismissal. The Board will have the power to reject complaints that:

• are not within its jurisdiction;
• are frivolous, vexatious or not made in good faith;
• have been settled between the employer and the employee;
• can be resolved by other means that the Board considers should be pursued;
• have been adequately dealt with by a court, tribunal, arbitrator or adjudicator; or
• have been suspended and the employee failed to comply with measures specified by the Board within the specific time period.

Miscellaneous

There are a number of other proposed changes to the Code by Bill C-86, including:

• Equal Pay for Equal Work: a requirement that part-time, casual, temporary, seasonal, and full-time employees receive equal pay for equal work under certain circumstances, as well as the right to request a review of wages;
• Reverse Onus: a requirement that an employer have the onus of establishing that an individual is not their employee in event of a complaint of a breach of Part III of the Code (standards, hours, wages, vacations and holidays);
• Minimum age: an increase of the minimum age of employment from 17 to 18 years of age (subject to certain exceptions);
• Written employment statements: a requirement to provide employees with a written statement containing information relating to their employment that is prescribed by regulation, as well as any updates, as they may be, within a specified time-period;
• Medical documents: leaves of absences may be supported by certificates from a broader class of "health care practitioners" rather than "qualified medical practitioners"; and
• Temporary Help Agencies: new requirements and liabilities for employers who use temporary help agencies including equal pay for temporary help agency employees where they are performing substantially the same kind of work as an employee of the employer, as well as limitations on agencies including a prohibition on preventing employees from establishing an employment relationship with a client organization.

Introduction of a Pay Equity Act

Bill C-86 will also introduce, on date still to be determined, a new framework for pay equity. The Pay Equity Act (the "PEA") would apply to federally regulated employers with more than 10 employees, including the federal private and public sectors, the federal public service, Parliamentary workplaces and Ministers' offices. Among other things, the PEA would require affected employers to evaluate their compensation practices by establishing and maintaining a pay equity plan. Employers with a 100 or more employees (or less for unionized employers) would also have to establish a pay equity committee.

Final Thoughts

As outlined above, the amendments to the Code arising from Bill C-86 are not yet in force. In the interim, federally regulated employers should be proactively reviewing their current practices to ensure their readiness for the changes that become effective September 1, 2019. Additionally, federally regulated employers should prepare to implement the remaining changes introduced by Bill C-86 and continue to monitor for announcements regarding their implementation dates. We will endeavour to keep you apprised of such further developments.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.