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					HIGHLIGHTS of the EMPLOYMENT STANDARDS ACT: A User’s Guide
May, 2006

Objective
• To gain familiarity with the highlights of this Ontario legislation which governs workplace practices • To minimize legal risks by learning about this legislation which forms the basis of our employment policies/contracts

A User’s Guide to the Highlights of the Act

Definition
• a statute (provincial law) • establishes a minimum standard for every employment contract • ensures fairness in workplace practices

A User’s Guide to the Highlights of the Act

Purpose of the Act
• To protect employees • To eliminate the need to negotiate • To ensure fairness in workplace practices

A User’s Guide to the Highlights of the Act

Jurisdiction
• Covers most Ontario employees with the exception of federal employees and a few others such as police officers, prison inmates, co-op students • It must be posted in the workplace • The Ministry of Labour enforces the ESA and its regulations, provides information, investigates potential violations and resolves complaints
A User’s Guide to the Highlights of the Act

Topics Covered
• • • • • • • Record Keeping Minimum Wage Hours of Work Overtime Vacation Public Holidays Leaves: maternity, parental, emergency, family medical • Termination Notice/Severance Pay
A User’s Guide to the Highlights of the Act

Record Keeping
• All employers in Ontario are required to keep written records about each person they hire for a specified period of time

A User’s Guide to the Highlights of the Act

Minimum Wage
• The lowest hourly wage an employer can pay employees • As of February 1,2006: $7.75/hour = general minimum wage $7.25/hour = student minimum wage • As of February 1, 2007:
$8.00/hour = general minimum wage $7.50/hour = student minimum wage
A User’s Guide to the Highlights of the Act

Hours of Work
• ESA dictates the maximum number of hours an employee can be required to work • In general, cannot exceed 8 hours per day OR more than 48 hours per week • Employers and employees can agree in writing to exceed these up to a maximum of 60 hours per week

A User’s Guide to the Highlights of the Act

Hours of Work (cont’d)
• ESA dictates the # of hours an employee must be free from work (daily, between shifts/weekly or biweekly) • Daily: must have 11 consecutive hours off work (Therefore, the max. number of hours worked in any 24-hour period cannot exceed 13 which includes: 12 hours of work and two 30-minute meal breaks) • Exception: not applicable to someone “called in” during a period they would not normally work
A User’s Guide to the Highlights of the Act

Hours of Work (cont’d)
• Between shifts: requirement of 8 hours off between shifts • Exception: does not apply if total time worked on both shifts does not exceed 13 hours (employer & employee can agree in writing for a shorter period off between shifts)

A User’s Guide to the Highlights of the Act

Hours of Work (cont’d)
• Weekly or Bi-weekly: employees must have a min. of 24 consecutive hours off each week; OR • 48 consecutive hours off every two weeks • Exception: only in exceptional circumstances involving a “serious interference” with operations

A User’s Guide to the Highlights of the Act

Overtime
• In general, hours worked in excess of 44 in a work week are to be paid as overtime • Overtime pay is 1.5 times the regular rate of pay (“time and a half”) • Calculated on a weekly (not daily) basis or over a longer period under an “averaging agreement” where an employer and employee agree in writing to average the hours of work over a 4-week period to determine overtime
A User’s Guide to the Highlights of the Act

Overtime (cont’d)
• Compensation for overtime:
– Can be monetary: 1.5 x hourly rate; or – Paid time off work (“time off in lieu”); 1.5 hours of paid time off work for each hour worked
– Must be taken within 3 months of being earned, or within 12 months with permission

– Employees cannot waive their right to overtime pay under the ESA
A User’s Guide to the Highlights of the Act

Vacation
• Vacation time off: 2 week yearly entitlement after 12 months of work (unpaid) • Can be taken one week at a time, or 2 weeks together, or, if the employer and employee agree in writing, in periods of less than a week • 12 months include time away from work due to illness, layoff, and other approved leaves • Timing of vacation decided by the employer, but to be scheduled no later than 10 months after the vacation has been earned (i.e. 22 months)
A User’s Guide to the Highlights of the Act

Vacation (cont’d)
• Vacation Pay: minimum of 4% of “gross wages” (excluding vacation pay) earned in a 12-month period for which vacation is received • Can be paid at any time if employer and employee are in agreement • Wages on which vacation pay is based include all compensation: regular earnings, overtime pay, public holiday pay, pay in lieu of notice, but NOT severance, travelling/living allowances and benefit plan payments
A User’s Guide to the Highlights of the Act

Vacation (cont’d)
• Vacation and public holidays: if a public holiday falls during a vacation period, the entitlement is: - a substitute day off work with public holiday pay, or - payment of public holiday pay for that day without giving the employee a substitute day off work (if the employee agrees)
A User’s Guide to the Highlights of the Act

Vacation (cont’d)
• Vacation entitlement accrues during pregnancy and parental leave • Vacation pay may be NIL, as 4% of no earnings during a leave = $0 • If an employee quits or is terminated, the 4% vacation pay must be paid out to them within 7 days
A User’s Guide to the Highlights of the Act

Public Holidays
• 8 statutory holidays: New Years, Good Friday, Victoria Day, Canada Day, Labour Day, Thanksgiving, Christmas Day, Boxing Day.

A User’s Guide to the Highlights of the Act

Public Holidays (cont’d)
• To become disqualified for public holiday entitlements, an employee must:
– Fail, without reasonable cause to work all of their regularly scheduled day of work before or after the public holiday (first and last rule) – Fail, without reasonable cause to work their entire shift on the public holiday if they agreed to or were required to work that day

A User’s Guide to the Highlights of the Act

Public Holidays (cont’d)
• Calculation example of public holiday pay:
– Nancy works 5 days/week and earns $100/day. She worked her last regularly scheduled work day before and after the holiday. Her public holiday pay, therefore, is: – $100/day x 5 days = $500. per week – $500/wk x 4 weeks = $2000. – $2000. total wages divided by 20 = $100. – Nancy is entitled to $100. public holiday pay
A User’s Guide to the Highlights of the Act

Public Holiday (cont’d)
• Scenarios: • (a) when a public holiday falls on a work day but the employee does not work it: she gets the day off with pay • (b) when it falls on an employee’s non-work day: she gets a substitute day off with pay or gets paid for the day with no substitute day off
A User’s Guide to the Highlights of the Act

Public Holiday (cont’d)
(c) When an employee agrees, in writing, to work on a public holiday: - she is paid her regular wages for all hours worked + receives another regular work day off with public holiday pay; OR, if the employee agrees in writing: gets public holiday pay + premium pay for all hours worked (but no substitute day off) for a total of 2.5x her regular rate.
A User’s Guide to the Highlights of the Act

Leaves
• Pregnancy Leave: • 2 pieces of legislation impact: Employment Insurance and Employment Standards • EI Act governs the monetary piece of the leave • ESA governs the protection of an employee’s job • No employee can be penalized in any way for taking a pregnancy or parental leave
A User’s Guide to the Highlights of the Act

Pregnancy Leave (cont’d)
• Pregnant employees have a right to up to 17 weeks of unpaid time off work • Both parents have the right to take parental leave (unpaid time off work): birth mothers who took pregnancy leave are entitled to 35 weeks; those who did not, are entitled to 37 weeks • both parents can be on leave at the same time
A User’s Guide to the Highlights of the Act

Pregnancy Leave (cont’d)
• Qualify if hired 13 weeks before expected date of delivery • Timing: can start no earlier than 17 weeks before the due date, but no later than the date of delivery – must be taken all at once • Notice: employee needs to provide a minimum of 2 weeks’ written notice of going on leave or 4 weeks’ written notice if resigning
A User’s Guide to the Highlights of the Act

Parental Leave
• Both parents are entitled (up to 35 or 37 weeks) of unpaid leave • To qualify, must have been hired at least 13 weeks prior to the leave • Definition of parent: birth or adoptive parent, or same sex partner treating child as their own • Notice: employee to provide 2 weeks written notice, but NOT obliged to give return date • If resigning, must provide 4 weeks’ written notice
A User’s Guide to the Highlights of the Act

Parental Leave (cont’d)
• Timing: for birth mothers, it follows the pregnancy leave unless the baby’s coming into her care is delayed (i.e. hospitalized) • All other parents must begin the leave no later than 52 weeks after the baby is born or comes into their care

A User’s Guide to the Highlights of the Act

Parental Leave (cont’d)
• Rights: - to return to the same or comparable job if the old one no longer exists - must be paid at least as much as before - must receive any scheduled increases awarded in her absence - to continue in benefits/pension plans - service/seniority continue - continued accrual of vacation time - period of leave is not included in probationary period
A User’s Guide to the Highlights of the Act

Emergency Leave
• Up to 10 days of unpaid time off work/calendar year because of illness, injury, certain emergencies, other urgent matters • 10 days do not need to be consecutive • A partial day off constitutes a full day taken • Employee needs to provide notice in advance whenever possible • Employer may ask for proof of need for leave

A User’s Guide to the Highlights of the Act

Family Medical Leave
• Possible 8-week leave to provide care or support to a family member with serious medical conditions • Significant risk of death within 26 weeks • Need of certificate from qualified health practitioner • Need to provide notice, but leave not dependent on notice • Timing: begins no earlier than 1st day of 26-week period and ends on last day of 26 week period or last day of the week in which family member dies
A User’s Guide to the Highlights of the Act

Termination and Notice
• For employees continuously employed for more than 3 months: must provide written notice of termination or termination pay (= pay in lieu of notice) or a combination of both • Intended as replacement income for a period of time • Statutory notice period is based on years of employment (less than 3 months = 0 notice required; 3 months to one year = 1 week notice required; 1-3 years = 2 weeks notice required; up to 8 years of work requiring a maximum of 8 weeks of notice.
A User’s Guide to the Highlights of the Act

Notice
• During notice period conditions of employment must not be altered • Vacation may not be scheduled during the notice period, unless the employee agrees • Benefits must continue during notice period • Calculation of “regular wages” for pay in lieu of notice for those without a regular work week: average regular wages over a 12-week worked period immediately preceding the date of notice
A User’s Guide to the Highlights of the Act

Notice (cont’d)
• “regular wages” do not include vacation pay, overtime, public holiday pay, premium pay, termination pay or severance pay • Notice not required for employees if: dismissed for just cause; free to choose without penalty whether or not they work when offered work; hired for a specific length of time and purpose, unless the contract ends early; refuses reasonable alternate employment; does not return to work when recalled; cannot complete work due to unforeseen circumstances (i.e. flood or fire); is terminated as a result of a strike or lockout
A User’s Guide to the Highlights of the Act

Severance Pay
• Compensation paid to qualified employees whose employment has been severed after working for the employer for 5 or more years • Separate from termination pay (pay in lieu of notice) • Compensates for loss of seniority and job related benefits and recognizes long service
A User’s Guide to the Highlights of the Act

Severance (cont’d)
• Severance pay is not required under almost identical circumstances to notice not being required • Calculation of severance pay: employees regular wages x # of completed years of employment (partial years included) • Maximum severance is 26 weeks • For those without regular wages for a regular work week, average the regular wages received over the 12 weeks worked immediately prior to when employment was severed
A User’s Guide to the Highlights of the Act

Severance (cont’d)
• Severance should be paid 7 days after the employee is terminated or on the next regular pay date, whichever is later • Severance may be paid in installments with Ministry approval

A User’s Guide to the Highlights of the Act

Thank you!
• Please contact Staff Relations with any questions pertaining to the Employment Standards Act. We would be pleased to help.

A User’s Guide to the Highlights of the Act


				
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