Last week, our Firm wrote about Ontario’s announcement that they would create three paid days of leave in response to public pressure. Ontario has now amended the Employment Standards Act, 2000 (the “ESA”) to create three paid days of leave for COVID-19 related purposes (the “New Leave”).
On April 29, Ontario passed Bill 284, COVID-19 Putting Workers First Act, 2021, which created the necessary ESA amendments. We present the key takeaways here.
How Many Days Can an Employee Take?
Employees covered by the ESA will now be entitled to the New Leave – three days of paid leave for specific COVID-19 related purposes. These are deemed to be taken in whole days, meaning that if an employee only takes part of a day under this leave, it counts as a whole day under their entitlement.
How Much Does an Employee Get Under the Benefit?
Employees who take the New Leave will receive the lesser amount of $200.00 per day and either of:
- the wages the employee would have earned had they not taken the leave; or
- if the employee receives performance-related wages, the greater of the hourly rate (if any) and the minimum wage that would have applied for the number of hours the employee would have worked had they not taken the leave.
The government can also prescribe different amounts by regulation.
When Can an Employee Take a Leave?
An employee can take the New Leave in the following COVID-19-related circumstances (the “Eligible Purposes“):
- Where the employee is under individual investigation, supervision, or treatment related to COVID-19. That includes taking time to be vaccinated, and recover from any side effects of vaccination effects.
- The employee is following a public health order under s. 22 or 35 of the Health Protection and Promotion Act (for example, if they are ordered by local public health to self-isolate).
- The employee is in quarantine, isolation, or is subject to a control measure (such as self-isolation) as a result of information or direction related to COVID-19 issued to the public in whole or part by a public health official, a qualified health practitioner, Telehealth Ontario, the Government of Ontario, the Government of Canada, a municipal counsel, or a board of health.
- The employee is under a direction from their employer in response to a concern that the employee may expose others in the workplace to COVID-19.
- The employee is providing care or support to a designated type of person (like an immediate family member) because that person is under individual investigation, supervision, or treatment related to COVID-19 or the individual is in quarantine, isolation, or subject to a control measure at the information or direction of an approved source.
The New Leave can be taken anytime between April 19, 2021 to September 25, 2021, with the Government leaving room to extend that period through regulation if they deem it necessary. For employees who want to take the New Leave retroactively between April 19 and April 29 (when the law passed), they must inform their employer in writing that they want to do so by no later than May 13, 2021.
Does an Employee Get to Choose Whether They Take a Paid Leave?
The default rule is that the employee will receive their three paid days under the New Leave before any unpaid leave entitlements under the ESA that might otherwise apply (like the three days of unpaid ESA sick leave or a virtually unlimited unpaid infectious disease emergency leave (IDEL)). However, the employee can choose to take the unpaid leave first if they like (the employer does not get this option of controlling this). The employee must advise the employer in writing if they want to do this, and they must make this notice before the end of the pay period that the leave occurred in.
What About Employees Who Already Have Contractual Sick Pay?
a) Legislative Reductions in Entitlements under the New Leave
The ESA has been amended to provide that:
If, on April 19, 2021, an employee is entitled to take paid leave under an employment contract in any of the circumstances for which the employee would also be entitled to take a leave under [the New Leave], the employee’s entitlement [to the New Leave under the ESA] is reduced by the employee’s entitlement under the contract.
[This reduction] applies only if the employer is required under the employment contract to pay the employee for the paid leave an amount that is equal to or greater than what the employee would be entitled to under [the ESA].
In other words, an employee’s ESA entitlement to the New Leave will be reduced by the amount of paid time off they had available to them on April 19, 2021 from their employer for the Eligible Purposes.
b) Key Dates Impacting Reductions in Entitlements
The key date that is considered in determining whether the reduction applies is April 19, 2021. If an employee’s contractual entitlements for 2021 were exhausted before April 19, 2021, then it appears that the reduction will not apply and an employee will still be entitled to the full benefits of the New Leave under the ESA.
Based on the inclusion of this precise date, arguably the reduction is based solely on what was available to employees on April 19, 2021, regardless of the fact that an employee might use any contractual paid time off for non-COVID-19 purposes thereafter, with the result that the employee would not have paid time available to them for IDEL when they need it. A strict wording of the language favours this interpretation fixing entitlements on the April 19, 2021.
c) Contractual payments must be Equal or Greater than the value of the New Leave
The other requirement for the reduction to apply, is that the employer’s existing paid time off be equal or greater than the ESA prescribed benefit (i.e. a full day’s pay or $200 for the day, whichever is less). If the benefit the employee has available is not at least a full-day’s pay or $200, whichever is less, then the reduction would not apply.
d) Reductions due to existing coverage for ANY Eligible Purposes
A final consideration, is whether the reduction will apply if the employer provided sick leave doesn’t cover all of the Eligible Purposes where the New Leave would apply. The ESA says that the the New Leave will be reduced if the employee has a right to employer paid time off in ANY of the circumstances on April 19, 2021. Furthermore, on the Ministry of Labour’s website, the government interprets the word “any of the circumstances” as meaning “one or more of the circumstances”.
If the government’s intention was to reduce entitlement to the New Leave where employees have paid time off available for even just one of the Eligible Purposes (and thereby reduce the government’s bill for the New Leave given their commitment to reimburse employers as discussed below), then this language opens the door to a narrow interpretation. For instance, if an employer’s sick leave program covers 10 days of illness only but not time off for vaccination, self-isolation, quarantine etc., arguably the New Leave would still be reduced due to the existing sick leave program.
At the same time, the ESA is remedial legislation and legally speaking should be interpreted broadly and in a manner that achieves its purposes of protecting employees. How legal decision makers (arbitrators, employment standards officers, or the Labour Board) will interpret this remains to be seen.
Hopefully, the government will issue interpretative guidance affirming this broad interpretation quickly to reduce the risk for employers that choose to honour a more employee friendly interpretation of the New Leave in the expectation of the government footing the bill.
Who Pays for Sick Leave?
Employers are required to provide pay for the New Leave directly to employees as part of regular payroll. However, employers can claim reimbursement for the New Leave from the WSIB. However, the WSIB will not reimburse employers for any contractually provided sick days that the Employer would have had to pay under the existing leave and benefit programs the employer had in place on or before April 19, 2021.
The WSIB will also not reimburse employers if the employee also received WSIB benefits on the day they received the New Leave with pay.
How Do Employers Get Reimbursements from the WSIB?
In order to claim reimbursement of COVID-19 paid leave from the WSIB, an employer must complete an application form and an attestation. When these are available, they will be posted on the WSIB website or the Government of Ontario’s webpage for this type of leave.
These documents must confirm:
- What dates that the leave was taken;
- That payments were made;
- What dates the payments to the employee were made were made; and
- Confirming that the employee on or after April 19 did not have an employment contract providing the leave.
Submission for reimbursement must be made within 120 days of the date that the leave was paid to the employee, and no later than January 25, 2022 or a later date if prescribed by regulation.
What Do Employees Get if they Take the Leave on a Holiday?
If an employee takes the ESA paid COVID-19 leave on a holiday, they will not be entitled to the ESA holiday premium.
Are Overtime Premiums or Shift Premiums Payable When Employees Take the Paid Leave?
If the ESA paid COVID-19 leave falls on a day when an employee would receive overtime or a shift premium, the employee will not receive either while on the leave. They will just receive straight pay.
Does this Benefit Violate Bill 124’s Wage Restraints?
This new benefit exempts itself from Bill 124’s application. So, it does not count towards 1% compensation limits.
Can Employers Cut Their Paid Sick Leave in Light of this Benefit?
If employers cut their paid sick days in light of this new benefit, they will not be entitled to any more reimbursement than they would have received before the cut (if any). In other words, an employer can’t reduce their contractually provided benefits in order to get the government to pay for what the employer would have been paying had they not reduced their contractual benefits.
How does this Interact with the Federal Canada Recovery Sickness Benefit?
At present, if an employee receives paid sick leave from their employer in a given week, they will not be entitled to receive the Canada Recovery Sickness Benefit. It remains to be seen if that will be changed.
There are many questions yet to be answered with this New Leave, particularly related to how it interacts with existing employer benefits. Hopefully, the Ministry of Labour will release an interpretive guide to the New Leave quickly and the WSIB will issue decisions early so that employers can avoid conflict, complaints and unexpected extra costs.
In the meantime, employer’s wishing to adopt a broad interpretation of the New Leave (benefiting their workers and our community by reducing the potential for spread of infection) would be well advised to seek legal advice about how to do so while reducing the risk of getting stuck with the bill if the government decides to take a narrower approach. This may include advice on how to complete the government’s forms, how to address the issue of recovering unfunded overpayments from employees, managing grievances and coming to letters of understanding with any unions involved.
PooranLaw will continue to monitor legal developments related to COVID-19 paid leave. 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.