COVID-19: Pandemic Pay Update

The second pandemic pay program, which began on October 1, 2020, is set to expire on August 23, 2021. The program, which is limited to specific categories of frontline workers, grants developmental services workers (frontline and supervisors working on the front line) an additional $3 per hour. Ontario Premier Doug Ford, while taking questions from the press on July 5, committed to making the program permanent. However, he did not qualify what he meant by “permanent”, i.e., whether the program will continue for the duration of the pandemic or will evolve into permanent wage increases.

If the latter interpretation reflects the government’s intention, there are certain key issues the government must consider before rolling out permanent wage enhancements:

  1. The government must be prepared to commitment to fund the wage increase permanently and to fund its peripheral or “roll-up” costs (such as correlated increases in overtime, benefits paid as a percentage of wages, vacation, public holidays, sick time, pension/RRSP contributions, EI, CPP and WSIB premiums, etc.).
  2. The government must ensure that any permanent enhancement applies across all sectors that share staff.  If DS sector workers were to be excluded and Long-Term Care Home and Retirement Home sector workers remain, DS sector staffing levels could be negatively impacted by the appeal of higher paying jobs elsewhere, further exacerbating existing recruitment and retention challenges.
  3. A permanent exemption from Bill 124’s compensation and salary restriction, given that a permanent $3 per hour raise would exceed the 1% cap on compensation and salary growth. The temporary suspension of Subsections 11 (1) and (2) of Bill 124 in Reg. 195/20 would need to become permanent, likely through an amendment to Bill 124 itself.
  4. A commitment from the government to fund a similar increase for supervisors and managers as a permanent increase for frontline workers only will in many cases result in extreme compression amongst job classes and in some cases result in supervisors and managers making less than the employees they supervise.
  5. Finally, the government must consider the impact of permanent wage enhancement on pay equity for employers in the proxy pay equity system and those that achieved pay equity through internal comparison methods.   Unilaterally and arbitrarily applying a permanent increase of a fixed dollar amount across all workers holding designated classifications without reference to the pay equity implications would have long range implications for compensation within agencies, sectors and across sectors.

As August 23 is upon us, we certainly hope that the government will soon release its plan to the public, which must take into account the foregoing key issues.

PooranLaw will continue to monitor legal developments related to pandemic pay. In the meantime, if you require legal assistance in determining how these new rules apply to you or your organization, we encourage you to reach out to your regular PooranLaw lawyer, or any member of our team.

Note: This article provides general information only and does not constitute, and should not be relied upon as, legal advice or opinion. PooranLaw Professional Corporation holds the copyright to this article and the article and its contents may not be copied or reproduced in any form, in whole or in part, without the express permission of PooranLaw Professional Corporation.