Bill 71 2008

An Act to amend the Employment Standards Act, 2000

Note: This Act amends the Employment Standards Act, 2000.  For the legislative history of the Act, see the Table of Consolidated Public Statutes – Detailed Legislative History on www.e-Laws.gov.on.ca.

Her Majesty, by and with the advice and consent of the Legislative Assembly of the Province of Ontario, enacts as follows:

   1.  Subsection 58 (1) of the Employment Standards Act, 2000 is repealed and the following substituted:

Notice, 50 or more employees

   (1)  Despite section 57, if the employer terminates the employment of 50 or more employees at the employer's establishment in the same four-week period, the employer shall give notice of termination, in the prescribed manner,

  (a)  when a mass layoff agreement has been signed in accordance with subsections (1.1) and (1.2),

           (i)  at least 16 weeks before the termination, if the number of employees whose employment is terminated is 50 or more but fewer than 200,

          (ii)  at least 20 weeks before the termination, if the number of employees whose employment is terminated is 200 or more but fewer than 500, and

         (iii)  at least 24 weeks before the termination, if the number of employees whose employment is terminated is 500 or more; or

  (b)  if no mass layoff agreement has been signed in accordance with subsections (1.1) and (1.2), at least 52 weeks before the termination.

Mass layoff agreement, mandatory provisions

   (1.1)  A mass layoff agreement shall deal with,

  (a)  retraining packages;

  (b)  severance enhancements;

   (c)  termination pay;

  (d)  early retirement;

  (e)  plant-saving restructuring options, including worker buyouts;

    (f)  transfers to other establishments of the employer; and

  (g)  any other prescribed matter.

Same, execution

   (1.2)  A mass layoff agreement shall be signed,

  (a)  by the employer; and

  (b)  on behalf of the employees whose employment is terminated,

           (i)  by every trade union representing any of the employees, and

          (ii)  by every employee who is not represented by a trade union, or by the employee's duly appointed representative.

   2.  (1)  Subsections 64 (1) and (2) of the Act are repealed and the following substituted:

Entitlement to severance pay

   (1)  An employer who severs an employment relationship with an employee shall pay severance pay to the employee if the employee was employed by the employer for one year or more and,

  (a)  the severance occurred because of a permanent discontinuance of all or part of the employer's business at an establishment and the employee is one of 25 or more employees who have their employment relationship severed within a six-month period as a result; or

  (b)  the employer has a payroll of $1 million or more.

Payroll

   (2)  For the purposes of subsection (1), an employer shall be considered to have a payroll of $1 million or more if,

  (a)  the total wages earned by all of the employer's employees in the four weeks that ended with the last day of the last pay period completed prior to the severance of an employee's employment, when multiplied by 13, was $1 million or more; or

  (b)  the total wages earned by all of the employer's employees in the last or second-last fiscal year of the employer prior to the severance of an employee's employment was $1 million or more.

   (2)  Clause 64 (4) (c) of the Act is amended by striking out "50 or more employees" and substituting "25 or more employees".

   3.  (1)  Subsection 65 (1) of the Act is amended by striking out "a regular work week" in the portion before clause (a) and substituting "two regular work weeks".

   (2)  Subsection 65 (5) of the Act is repealed.

   (3)  Subsection 65 (6) of the Act is amended by striking out "subsections (1) and (5)" in the portion before clause (a) and substituting "subsection (1)".

Commencement

   4.  This Act comes into force on the day it receives Royal Assent.

Short title

   5.  The short title of this Act is the Employment Standards Amendment Act, 2008.

 

EXPLANATORY NOTE

The Bill makes several amendments to the Employment Standards Act, 2000.

Subsection 58 (1) of the Act requires an employer who terminates the employment of 50 or more employees in the same four-week period to give notice of termination "for the prescribed period".  Notice periods are prescribed in Ontario Regulation 288/01, which requires eight weeks notice if up to 199 employees are being terminated, 12 weeks notice for 200 to 499 employees, and 16 weeks for 500 or more employees.  The Bill provides for increased notice periods (16, 20 and 24 weeks, respectively), building them into the Act itself, and adds the requirement of a mass layoff agreement between labour and management, dealing with such matters as retraining and restructuring options.  If no mass layoff agreement is reached, a uniform 52-week notice period applies instead of the 16, 20 and 24-week periods.

Section 64 of the Act provides that an employee is entitled to severance pay if he or she has worked for the employer for at least five years and the employer has a payroll of at least $2.5 million.  The Bill reduces the qualifying period of employment to one year and the payroll level to $1 million.

Under section 65 of the Act, severance pay is calculated as one week's pay for each year of employment.  The Bill increases this to two weeks' pay for each year of employment.  Subsection 65 (5) of the Act, which caps severance pay at a 26-week maximum, is repealed.