canada-labour-code-changes-for-employee-rights

Recently, the federal government significantly updated the Canada Labour Code, which brings it more in line with (and even exceeds) some of the employment law requirements set out in the Ontario Employment Standards Act, 2000. Most importantly, the new employment standards involves an increase in the the amount of notice of termination of employment (or compensation in lieu of notice of termination) applicable to employees working for federally regulated employers if their employment is terminated without cause.

In sum, the amendments to the Canada Labour Code will require employers to (a) reimburse reasonable work-related expenses; (b) provide employees with materials regarding employer and employee rights and entitlements at the time of hire, upon termination, and whenever updated materials are made available by the Ministry of Labour; (c) post these materials in readily accessible places; and (d) provide employees with written statements containing information regarding the terms and conditions of their employment.

What’s different under the new Canada Labour Code provisions?

Currently, an employer must provide an employee with at least two (2) weeks written notice of their intention to terminate the employment of an employee. In lieu of written notice, the employer must pay two weeks wages at the regular rate to the employee. Additionally, an employee is also entitled to receive two (2) days’ pay at the employee’s regular rate of wages for each full year of employment, with a minimum of 5 days’ pay.

Specifically, as of February 1, 2024, the current 2-week notice period required under the Canada Labour Code will be replaced with a progressively increasing notice of termination system similar to that in provincial employment standards legislation.

Notice of Termination
Period of employment	Termination Notice Required
At least 3 months of service with the employer, up to 3 years	2 weeks
At least 3 years of service with the employer, up to 4 years	3 weeks
At least 4 years of service with the employer, up to 5 years	4 weeks
At least 5 years of service with the employer, up to 6 years	5 weeks
At least 6 years of service with the employer, up to 7 years	6 weeks
At least 7 years of service with the employer, up to 8 years	7 weeks
At least 8 years of service or more with the employer	8 weeks

Employment Statement

Employers must now also provide employees with written statements regarding certain terms and conditions related to their employment within the first 30 days of employment. Employers have up to October 7, 2023 to provide an employment statement to employees who were employed as of July 9, 2023.

This written statement must consist of relevant information about the employee’s job, including:

the names of the parties to the employment relationship;
the job title of the employee and a brief description of their duties and responsibilities;
the address of the ordinary place of work;
the date on which the employment commences;
the term of the employment;
the duration of the probationary period, if any;
a description of the necessary qualifications for the position;
a description of any required training for the position;
the hours of work for the employee, including information on the calculation of those hours and rules regarding overtime hours;
the rate of wages or salary and the rate of overtime pay;
the frequency of pay days and the frequency of payment of any other remuneration;
any mandatory deductions from wages; and
information about how the employee can claim reimbursement of reasonable work-related expenses.

Employers must provide an updated statement within 30 days of any change to the information in an original (or prior) statement.

How Notice of Termination of Employment Works

The employer’s requirement to provide an employe with written notice (or pay in lieu of notice) does not apply to:

This requirement applies to any employee whose employment is being terminated except as follows:

an employee who has not completed 3 consecutive months of continuous employment
an employee who terminates their own employment (resigns or abandons their job)
an employee who is dismissed for just cause
an employee who is on a lay-off that does not constitute a termination of employment
where the contract provides an end and that the work ends on that date

An employer must provide notice of termination in writing (that is, a written termination letter or severance package). The notice of termination (or compensation in lieu of notice) must include the employee’s regular wages for their regular hours of work, or a combination of both.

Reimbursement of Reasonable Work-Related Expenses

Employers will be required to reimburse employees for reasonable work-related expenses, unless such expenses are deemed ineligible for reimbursement under the Standards Regulation, written agreement or employment contract between the employer and employee.

Specifically, to be eligible for reimbursement, an expense must meet the following 4 eligibility criteria. To determine what types of expenses are “work-related” or “reasonable” and must be reimbursed, employers must consider a list of factors, including:

1. The employee does not have to pay the expense

2. The employee paid the expense out-of-pocket

3. The expense is work-related

Whether the expense is connected to the employee’s performance of work
Whether the expense enables an employee to perform work
Whether incurring the expense is required by the employer as a condition of employment or continued employment
Whether the expense satisfies a requirement for the employee’s work imposed by an occupational health or safety standard
Whether the expense is incurred for a legitimate business purpose and not for personal use or enjoyment

4. The expense is reasonable

Whether the expense is connected to the employee’s performance of work
Whether the expense enables an employee to perform work
Whether the expense is incurred at the request of the employer
Whether any amount of expense is incurred beyond the amount necessary to enable the performance of the work
Whether the expense is one that is normally reimbursed by employers in similar industries
Whether the employer authorized the expense in advance
Whether the expense is incurred by the employee in good faith
Whether the claim includes documentation, such as a receipt or invoice, that indicates that the expense was incurred

Employers must reimburse employees for eligible work-related expenses within 30 days of the employee submitting the claim, unless another time frame is established by a collective agreement or by a written agreement between the employee and the employer.

Importantly, this obligation only applies to eligible work-related expenses incurred on or after July 9, 2023.

Ministry of Labour Material on Employer and Employee Rights and Obligations

Employers to provide employees with materials made available by the Ministry of Labour.

Firstly, employers must provide all current employees with materials made available by the Ministry of Labour containing information regarding employer and employee rights under Part III of the Code within 30 days after an employee’s first day on the job.. When the Ministry makes updated materials available, employers must provide updated materials to all employees within 30 days of them being made available.

Secondly, employers must post these materials in readily accessible places where they will likely be seen by employees.

Lastly, employers must provide a terminated employee with the materials made available by the Ministry of Labour relating to termination of employment, by no later than their last day of employment.

Failure to Comply

Employers who do not comply with these new Canada Labour Code employment requirements may be subject to administrative monetary penalties, which will be based on the type of violation, the size of the employer, and the employer’s compliance history.

Call a Toronto Employment Lawyer

In Ontario employment law, it is always prudent for employers (and employees) to speak with an experienced employment lawyer when they would like to know what legal rights you have as an employer or employee in Ontario. If you are an employee who believes you were wrongfully dismissed or want to negotiate your severance package, please speak with our experienced wrongful dismissal lawyer in Toronto regarding your legal rights and options as an employee, including negotiating your severance package to obtain the severance compensation you deserve, as well as wrongful dismissal claim.

Contact a Toronto human rights lawyer by phone 647-822-5492 or fill out the contact form to the side. Our employment lawyer in Toronto would be happy to assist in your employment law matter as quickly as possible.

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