Significant Changes to Ontario Employment Legislation Proposed

The Fair Workplaces, Better Jobs Act, 2017 (Bill 148) continues on its path to becoming law in Ontario. Bill 148 was introduced by the Ontario government on June 1 in response to the final report of the Changing Workplaces Review. In this review, special advisors made 173 recommendations for amendments to Ontario's Employment Standards Act, 2000 (ESA) and Labour Relations Act, 1995. Bill 148 was considered in a number of Standing Committees on Finance and Economic Affairs sessions over the summer, and on September 11 it was amended and ordered for a second reading. Once passed, the majority of the proposed changes to the ESA are scheduled to come into force on January 1, 2018.

What You Need To Know

If passed, Bill 148 will have significant implications for employers in Ontario. Some highlights of the proposed legislation include the following:

• Raising general minimum wage to $15 by 2019: Bill 148 will increase the general minimum wage to $14 per hour on January 1, 2018 and $15 per hour on January 1, 2019, followed by annual increases at the rate of inflation.
• Mandating equal pay for part-time and full-time employees: Bill 148 will require employers to pay casual, part-time, temporary and seasonal employees equally as full-time employees when performing the same job. Exceptions will be available where a wage difference is based on seniority or merit.
• Requiring employers to follow new scheduling rules: Bill 148 will require employers to pay employees for three hours of work if their shift is cancelled within 48 hours of its scheduled start time (unless in certain circumstances beyond the employer's control). Additionally, Bill 148 will require employers to pay "on-call" employees for three hours at their regular rate of pay for each 24-hour period they are on call and either not called into work or called in but required to work less than three hours.
• Prohibiting employers from misclassifying employees as "independent contractors": Bill 148 will impose measures aimed at addressing cases where employers misclassify employees as independent contractors. Employers that improperly misclassify their employees as independent contractors could be subject to monetary penalties and prosecution. Notably, in the event of a dispute, the employer would be responsible for proving the individual is not an employee.
• Expanding vacation and leave provisions: Bill 148 will ensure employees are entitled to three weeks of paid vacation after five years of service with the same employer, simplifying the formula for calculating holiday pay and providing 10 personal emergency leave days per year for all employees, including two paid days. There would be no change to paid vacation entitlements for employees with fewer than five years of service. Bill 148 now also introduces a standalone leave for domestic or sexual violence (lasting up to 10 days and up to 15 weeks per calendar year), amends pregnancy leave (for employees who suffer a still-birth or miscarriage) and increases parental leave by 26 weeks.
• Increasing penalties for non-compliance: Bill 148 will increase flexibility around the administrative monetary penalties employment standards officers can issue against employers who violate the ESA. The government also intends to amend a regulation under the ESA to increase the maximum administrative monetary penalties from $250, $500 and $1,000 to $350, $700 and $1,500, respectively. The proposed changes would allow the director of employment standards to publish the names of employers who have been issued a penalty.

The government has also announced an intention to hire up to 175 more employment standards officers and launch a new program to educate employees and small and medium-sized businesses about their rights and obligations under the ESA, and to provide compliance assistance to new employers with a focus on small and medium-sized businesses.

We will provide further updates as Bill 148 proceeds towards becoming law.