In an effort to help businesses avoid permanently laying off their employees, the Ontario government will be temporarily amending labour laws under the Employment Standards Act. This decision, announced on Monday, June 1, is made amidst fears the severance costs that would otherwise be payable by law would put many businesses that are struggling to stay afloat during the pandemic into bankruptcy.

Currently, the Employment Standards Act (Ontario) requires businesses to terminate employees who have been laid off for 13 weeks. The law then requires the employer to pay severance to workers. The amendment will see non-unionized workers who have had their hours reduced or eliminated placed on a temporary leave that preserves their employment. Additionally, workers will still be eligible for federal emergency income support programs.

This amendment will apply retroactively to March 1, 2020 and does not include unionized workers who are covered by collective agreements.

HazloLaw-Business Lawyers will continue to monitor the situation for updates.