Major Changes Coming to Employment Legislation in Ontario
The Ontario government has tabled the Working for Workers Act, 2021 (“Bill 27”). If passed, Bill 27 will make significant changes to employment-related legislation in Ontario, including new rules on how employees conduct their work duties at home; the use of non-competition clauses in employment agreements; and new licensing requirements for recruiters and temporary help agencies.
The Right to Disconnect: Changes to How Employees Work from Home
Bill 27 will amend the Employment Standards Act, 2000 (the “ESA”) and require employers with 25 or more employees to have a written policy about employees disconnecting from work at the end of the workday. Under Bill 27, “disconnecting from work” means not engaging in work-related communication, including e-mails, telephone calls, video calls or the sending or reviewing of other messages, so as to be free from the performance of work. The Ontario government explained that the goal of this amendment is to help employees spend more time with their families outside of work.
Bill 27 does not provide the details of what information the written policy must contain. However, Bill 27 specifies that employers will have six months after the day Bill 27 is passed to determine whether they have at least 25 employees and to comply with the requirement to implement a right-to-disconnect policy. Thereafter, on January 1 of each year, employers will have to determine whether they employ at least 25 employees and ensure a written right-to-disconnect policy is put into place before March 1 of that year.
If passed, Bill 27 will require employers to provide a copy of the written policy to each of its employees within 30 days of preparing the policy (or, if an existing written policy is changed, within 30 days of the changes being made). Employers will also need to retain copies of every written right-to-disconnect policy required under the ESA for three years after the policy ceases to be in effect.
A Ban on Non-Competition Clauses in Employment Agreements
Bill 27 will amend the ESA to prohibit the use of non-compete agreements in certain circumstances. Bill 27 defines “non-compete agreement” as an agreement, or any part of an agreement, between an employer and an employee that prohibits the employee from engaging in any business, work, occupation, profession, project or other activity that is in competition with the employer’s business after the employment relationship between the employee and the employer ends.
If Bill 27 is passed, the ESA will prohibit employers from entering into an employment contract or other form of agreement with an employee that is, or that includes, a non-compete agreement. If an employer contravenes this requirement, the non-compete agreement will be void. An exception to the prohibition on non-compete agreements will be allowed in the contexts of business sales, such that a purchaser and seller will be allowed to enter into a non-compete agreement prohibiting the seller from engaging in activity that is in competition with the purchaser’s business after the sale. This exception will be granted even if the seller becomes an employee of the purchaser.
As of the date of this blog, it is not clear whether the prohibition on non-compete agreements will retroactively apply to such agreements already in place.
Proposed New Rules for Temporary Help Agencies
Bill 27 will also amend the ESA to prohibit individuals from operating as a temporary help agency or acting as a recruiter without a license for that purpose. Clients, employers, and prospective employers will also be prohibited from knowingly engaging or using the services of an unlicensed temporary help agency or recruiter.
The Director of Employment Standards (the “Director”) will have the authority to issue, revoke, and suspend licenses. The Director will also have authority to refuse to issue or renew a license if the Director has reasonable grounds to believe that
- the applicant will not carry on business with honesty and integrity and in accordance with the law;
- the applicant has made a false or misleading statement or provided false or misleading information in the application; or,
- if any other prescribed circumstances exist.
If the Director refuses to issue or renew a license, or revokes or suspends a license, the Director will be required to serve notice of the refusal, revocation or suspension to the applicant and provide written reasons for same.
The Director will also be required to publish and maintain a record of information related to licensing under the ESA amendments, including:
- the name of every person licensed under the ESA, the date the person’s licence was issued or renewed and the date the person’s licence expires;
- the name of every person whose licence has been revoked or suspended under the ESA and the date of the revocation or suspension; and,
- any other prescribed information.
Licences granted by the Director will expire one year after the date it was issued or renewed, or on the expiration of a longer period that may be prescribed. The Director’s authority to issue, revoke, and suspend licenses will be subject to appeal to the Ontario Labour Relations Board.
Bill 27 will also prohibit recruiters or persons acting on behalf of a recruiter from making reprisals against prospective employees on a variety of grounds, such as because the prospective employee:
- asked the recruiter to comply with the ESA and its regulations;
- gave information to an employment standards officer; or,
- made inquires about whether a person holds a licence to operate as a temporary help agency or to act as a recruiter as required by the ESA.
Among other amendments, Bill 27 will amend the Occupational Health and Safety Act to require business orders to allow delivery workers to use a company’s washroom if they are delivering or picking up items (with some exceptions), and to allow the surpluses in the Workplace Safety and Insurance Board’s Insurance Fund to be distributed over certain levels of businesses to help them cope with the impacts of COVID-19. There are also proposed amendments to the Fair Access to Regulated Professions and Compulsory Trades Act, 2006 to remove Canadian experience requirements for internationally trained individuals to help them get licenced in a regulated profession and access jobs that match their qualifications and skills.
Bill 27 is still under review by the Ontario legislature and may be subject to change. We will continue to monitor its progress. Employers should seek legal advice if they have any questions about Bill 27 and how it may impact their workplace.
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