In March of 2021, the Ontario Court of Appeal released a long-awaited and precedent-setting decision in Ontario Nurses’ Association v. Participating Nursing Homes, 2021 ONCA 148 (“Participating Nursing Homes“).

Contrary to practices previously endorsed by the Pay Equity Commission, the Court of Appeal determined that public sector employers who achieved pay equity using the “proxy method” have an ongoing obligation to revisit comparator information of the “proxy employer” to maintain pay equity. The matter has been remitted to the Pay Equity Hearings Tribunal (the “Tribunal”) to specify what procedures should be used to ensure that pay equity is maintained under “proxy plans” with ongoing reference to male comparators.

This is the second of a two-part series. Part One provided an overview of the pay equity maintenance obligation. This Part Two will explain how the Court of Appeal’s decision in Participating Nursing Homes affects the pay equity maintenance obligation for “proxy employers” in the broader public sector.

Participating Nursing Homes

In 1995, the Participating Nursing Homes (“PNH”) established pay equity for their female employees using the proxy method. After lengthy negotiations, the PNH, the Ontario Nurses’ Association, and Service Employees International Union, Local 1 (collectively, the “Unions”) reached an agreement to achieve pay equity, and pay equity was established for all female job classes at the PNH by 2005.

After 2005, the Unions alleged that a gender-based wage gap between employees of the PNH and the proxy employer had re-emerged. The Unions argued that pay equity had not been maintained, and insisted that the PHN continue to revisit proxy information to properly maintain pay equity. The PNH disagreed, arguing that the Act only required them to use the proxy method to establish pay equity — not to maintain it.

The Unions eventually applied to the Tribunal to compel PNH to continue to revisit proxy information during the pay equity maintenance process. The Unions’ primary position was that the Act required ongoing reference to proxy information during the maintenance process. In the alternative, the Unions argued that the Act’s failure to require ongoing reference to proxy information was contrary to s. 15 of the Canadian Charter of Rights and Freedoms (“Charter“).

The Tribunal agreed that employers who achieved pay equity using the proxy method had an obligation to maintain pay equity, but maintained that “traditional approach” (outlined above) was adequate. However, the Tribunal’s decision was overturned on judicial review by the Ontario Divisional Court. The Divisional Court agreed that ongoing pay equity maintenance obligations applied to proxy plans, but concluded that it was contrary to Charter values not to require proxy employers to continue to monitor male comparators. According to the Divisional Court, male comparators must continue to be monitored to ensure women subject to proxy plans could seek redress for unjustified pay inequities that emerge after their proxy plan is established.

The Unions appealed the Divisional Court’s decision to the Ontario Court of Appeal. The Court of Appeal agreed with the Divisional Court’s conclusion but did not base its reasoning on Charter values. Applying the basic principles of statutory interpretation, the Court of Appeal reasoned that “[t]he scheme of the Act is built on the fundamental premise that in order to redress systemic gender discrimination in compensation, there must be a comparison between male and female job classes”.  To this end, the Court of Appeal concluded that the proxy plan maintenance process must continue to monitor male comparators to adequately address the fundamental purposes of the Act.

We will be monitoring the Tribunal’s response to the Ontario Court of Appeal’s decision and will keep you apprised of any new procedures that are established for ensuring that pay equity is maintained under “proxy plans” with ongoing reference to male comparators.

Many thanks to Alissa Scarcello for her assistance with this article.

On May 13, 2021, the Ontario government announced that it will extend the province-wide Stay-at-Home Order (O. Reg. 265/21) by two weeks, until June 2, 2021. The government announced that all public health and workplace safety measures under the province-wide emergency brake will remain in effect during this time.

On April 7, 2021, in response to a rise in COVID-19 infections, the Ontario government had declared a third provincial emergency under the Emergency Management and Civil Protection Act, and issued a Stay-at-Home-Order (the “Order”), effective Thursday, April 8, 2021 and set to expire on May 19, 2021. See here our discussion on the current Order.

The official announcement from the province can be found here.

On May 20, 2021, the Ontario government announced a “Three-Step Roadmap to Safely Reopen the Province” which outlines its plan to gradually lift COVID-19 public health restrictions based on province-wide vaccination rates and improvements in key public health and health care indicators. The full announcement can be found here, which includes a link to the Roadmap.

The Roadmap outlines three steps to easing public health measures, guided by the following principles:

• Step 1: An initial focus on resuming outdoor activities with smaller crowds where the risk of transmission is lower, and permitting retail with restrictions. This includes allowing outdoor gatherings of up to 10 people, outdoor dining with up to four people per table and non-essential retail at 15% capacity.
• Step 2: Further expanding outdoor activities and resuming limited indoor services with small numbers of people where face coverings are worn. This includes outdoor gatherings of up to 25 people, outdoor sports and leagues, overnight camps, personal care services where face coverings can be worn and with capacity limits, as well as indoor religious services, rites or ceremony gatherings at 15% capacity.
• Step 3: Expanding access to indoor settings, with restrictions, including where there are larger numbers of people and where face coverings cannot always be worn. This includes indoor sports and recreational fitness; indoor dining, museums, art galleries and libraries, and casinos and bingo halls, with capacity limits.

The province will remain in each step for at least 21 days. If at the end of the 21 days, the following vaccination thresholds have been met, along with positive trends in other key public health indicators, the province will move to the next step:

• Step 1: 60% of adults vaccinated with one dose.
• Step 2: 70% of adults vaccinated with one dose and 20% vaccinated with two doses.
• Step 3: 70 to 80% of adults vaccinated with one dose and 25% vaccinated with two doses.

At this time, the province expects to enter Step 1 of the Roadmap the week of June 14, 2021. The province will confirm closer to the expected start of Step 1. Further, effective May 22, the province will reopen certain outdoor recreational amenities, including golf courses, driving ranges, tennis and basketball courts, and soccer fields. Otherwise, the restrictions imposed by the province-wide emergency brake and Stay-at-Home Order will remain in effect. See here for our discussion of the current Stay-at-Home-Order in place in Ontario.

On May 20, 2021, the government of British Columbia passed Bill 13, Employment Standards Amendment Act (No. 2), 2021, which amends the Employment Standards Act, 1996 to provide employees with three days of paid sick leave for reasons related to COVID-19, as well as a permanent paid sick leave for any illness or injury.

Eligibility for Paid Leave for Reasons Related to COVID-19

Full-time and part-time employees are eligible for up to three days of paid sick leave if they are unable to work for the following reasons related to COVID-19:

• the employee is diagnosed with COVID-19 and is acting in accordance with an order or instructions of a medical health officer or advice of a medical practitioner, nurse practitioner or registered nurse;
• the employee is in quarantine or self-isolated as required by law; and/or
• the employee is being directed to stay home by their employer due to exposure-related risks.

Employers will be required to pay employees their full wages for the duration of the leave. Employers without an existing paid sick leave program/policy will be able to seek reimbursement of up to $200 per employee per day from the government. Employers with employees earning more than $200 per day will be responsible for covering the excess daily wages.

This leave is in addition to the three days of unpaid leave that are already available to workers under the ESA, is separate from the workers’ compensation system and will not impact WorkSafeBC’s employer premiums or its accident fund. It will only be in effect until December 31, 2021. WorkSafe BC will administer the reimbursement program. Details on this program and how employers can register will be made available in June.

Permanent Paid Sick Leave Day

Bill 13 also introduces provisions for a permanent paid sick leave program for workers who cannot work due to any illness or injury starting January 1, 2022. While Bill 13 does not provide any further details relating to the number of paid days and other supports for this permanent leave, the Government of British Columbia has announced that details will be determined following consultations with relevant stakeholders over the next several months. We will continue to monitor for further information.

Key Takeaways

Employers should review the amendments to the ESA and review existing policies and practices to address the availability of this leave. Eligible employers should also monitor WorkSafe BC’s website for details on the reimbursement program and how to register and apply for a reimbursement.

Because employees are not required to provide a doctor’s note in order to take a COVID-19 related sick day, employers should train human resources staff on validating and managing COVID-related leave requests and remind staff about the sensitive nature of the information being collected and the need to maintain privacy and confidentiality.

Governments across Canada are rapidly responding to the impact that COVID-19 continues to have on economic and employment life. The provinces and territories are regularly amending COVID-19 related economic measures and extending minimum protections and other provinces have started to introduce paid sick days for reasons related to COVID-19. For example, the Ontario government passed Bill 284, COVID-19 Putting Workers First Act, 2021 amending the Employment Standards Act, 2000 (the “ESA“) to require employers to provide employees with up to three days of paid leave if they miss work for reasons related to COVID-19. Similarly, provinces such as Manitoba, have added a paid leave for COVID-19 vaccinations. We continue to monitor changes as other provinces and territories introduce similar leaves.

The provincial stay-at-home order expired on June 2, 2021. However, as of June 7, 2021, all measures which were in place under the province-wide emergency break continue to remain in effect, including restrictions on gatherings, businesses, services and activities. You can find a list of the current restrictions under the emergency break here.

On June 7, 2021, the Ontario government announced that the province will enter Step 1 of the Roadmap to Reopen at 12:01 a.m. on Friday, June 11, 2021. Under Step 1, non-essential retail will be permitted to operate at 15% capacity, and essential and other select retail will be permitted at 25% capacity. Restrictions regarding the sale of certain goods will be lifted for both essential and non-essential retail. Children’s day camps will also be permitted to operate in a manner consistent with safety guidelines from the Chief Medical Officer of Health.

The province will remain in Step 1 for at least 21 days to evaluate any impacts on public health. If certain public health conditions are met, the province will move to Step 2 of the Roadmap. You can find our blog post on the province’s three-step Roadmap to Reopen here.

Employers should continue to pay close attention to the latest public health restrictions to understand how they affect their business. If you have any questions about what the current restrictions mean for your business, please contact our team.

In a recent decision, the British Columbia Supreme Court (“BC Court“) ruled that Canada Emergency Response Benefit (“CERB”) payments earned during the notice period would be deducted from wrongful dismissal damages. This decision stands in stark contrast to that recently issued in Ontario, where the Superior Court of Justice (“Ontario Court“) refused to deduct CERB benefits from a damages award. The apparent inconsistency between the cases will have to be resolved in future litigation. In the meantime, employers should consider in each case whether it is appropriate to adopt the approach in Hogan when structuring severance packages.

The BC Decision

In Hogan v. 1187938 B.C. Ltd, 2021 BCSC 1021 (“Hogan“), Mr. Hogan was temporarily laid off and subsequently terminated from his employment with an automotive dealership. Mr. Hogan sued the dealership for constructive dismissal.

The BC Court held that the dealership’s unilateral decision to layoff Mr. Hogan amounted to a constructive dismissal, and as a result, he was entitled to pay in lieu of 22 months of reasonable notice. The dealership argued that all CERB benefits earned by Mr. Hogan during the notice period should be deducted from the damages it was ordered to pay.

The BC Court agreed with the dealership. CERB is not a private insurance benefit for which the employee paid premiums. Further, unlike Employment Insurance benefits, which are subject to repayment following receipt of a severance payment, there is no evidence to suggest that CERB benefits will need to be repaid. Therefore, if Mr. Hogan received both CERB benefits and wrongful dismissal damages during the reasonable notice period, he would end up in a better position than he would have been had he been given advance notice of termination.

Applying the general rule of damages for breach of contract, the BC Court found that Mr. Hogan should be put in the same position he would have been in had the dealership not breached the employment contract. This requires deducting CERB benefits from the damages ultimately awarded.

The Ontario Decision

The Ontario Superior Court of Justice took a seemingly different approach in Iriotakis v. Peninsula Employment Services Limited, 2021 ONSC 998 (“Iriotakis“). In that case, the Ontario Court refused to deduct CERB benefits from wrongful dismissal damages. The Ontario Court looked at the disparity between the CERB benefits the employee earned, and the overall amount of money the employee lost as a result of being terminated. A large portion of the employee’s earnings were based on commissions, most of which he was not entitled to during the reasonable notice period. As a result, the Ontario Court determined that it would not be equitable to reduce the employee’s damages by the CERB benefits he earned during that time. In Iriotakis, the Ontario Court emphasized that their decision was specific to the facts of the particular case—facts which were distinguished from Hogan.

Key Takeaways

To date, Hogan and Iriotakis are the only two decisions in Canada on the issue of whether CERB benefits should be deducted from wrongful dismissal damages. Although the two cases are factually distinct, the principles set out in these cases are difficult to reconcile. The BC Court took a principled approach, ensuring the plaintiff was not put in a better position than he would have been had the defendant complied with its common law obligation to provide him with reasonable notice (or payment in lieu). Conversely, the Ontario Court took a fact-based approach, and decided it would not be fair to deduct CERB benefits from the plaintiff’s damages, given the plaintiff’s limited entitlements from the employer post-termination, relative to his actual pre-termination earnings.

It will be interesting to see how courts across Canada continue to address this issue, particularly in light of the discrepancy between the different approaches taken in British Columbia and Ontario. Given the volume of employment litigation arising from the pandemic, we suspect that there will be many more decisions on this issue.

On June 24, 2021, the Ontario government announced that the province will enter Step Two of the Roadmap to Reopen two days earlier than expected, at 12:01 a.m. on Wednesday, June 30, 2021. Under Step Two, the following is permitted to operate:

• essential and other select retail at 50% capacity;
• non-essential retail at 25% capacity;
• personal care services where face coverings can be worn at all times and with other restrictions, at 25% capacity; and
• overnight camps for children, so long as they operate consistently with the safety guidelines provided by Ontario’s Chief Medical Officer of Health.

A number of other restrictions will be eased under Step Two. The province’s announcement along with a full list of permitted activities under Step Two can be found here.

The province may remain in Step Two for 21 days to evaluate any impacts on public health. However, Ontario has already surpassed the vaccination targets required for Step Three. You can find our blog post on the province’s three-step Roadmap to Reopen here.

Employers should continue to pay close attention to the latest public health restrictions to understand how they affect their business. If you have any questions about what the current restrictions mean for your business, please contact our team.

On July 9, 2021, the Ontario government announced that the province will enter Step Three of the Roadmap to Reopen on Friday, July 16, 2021, five days earlier than expected. Under Step Three, the following is permitted to operate:

• indoor dining with no limits on the number of patrons per table with physical distancing and other restrictions still in effect;
• indoor meeting and event spaces with physical distancing and other restrictions still in effect and capacity limited to 50% or 1,000 people (whichever is less);
• essential and non-essential retail with capacity limited to the number of people that can maintain a physical distance of two meters;
• personal care services, including services requiring the removal of a face covering, with capacity limited to the number of people that can maintain a physical distance of two meters;
• museums, galleries, historic sites, aquariums, zoos, landmarks, botanical gardens, science centres, casinos/bingo halls, amusement parks, fairs and rural exhibitions, festivals, with capacity limited to 50% indoors and 75% outdoors;
• concert venues, cinemas, and theatres permitted to operate at:
  • up to 50% capacity indoors or a maximum limit of 1,000 people for seated events (whichever is less)
  • up to 75% capacity outdoors or a maximum limit of 5,000 people for unseated events (whichever is less); and up to 75% capacity outdoors or a maximum of 15,000 people for events with fixed seating (whichever is less).
• indoor food or drink establishments where dance facilities are provided, including nightclubs and restobars, permitted up to 25% capacity or up to a maximum limit of 250 people (whichever is less).

A number of other restrictions will be eased under Step Three. The province’s announcement along with a full list of permitted activities under Step Three can be found here.

The province will remain in Step Three for at least 21 days and until 80% of the eligible population has received at least one dose of a COVID-19 vaccine and 75% have received their second, with no public health unit in the province having less than 70% of people fully vaccinated. Other key public health and health care indicators must also continue to remain stable. Upon meeting these thresholds, the vast majority of public health and workplace safety measures, including capacity limits for indoor and outdoor settings and limits for social gatherings, will be completely lifted. Only a small number of measures are expected to remain in place following the end of Step Three, including passive screening (e.g. posting signs at all entrances informing people to screen themselves for COVID-19 before entry), and having a safety plan for businesses. Face coverings in indoor public settings and physical distancing requirements remain in place throughout Step Three. You can find our blog post on the province’s three-step Roadmap to Reopen here.

Employers should continue to pay close attention to the latest public health restrictions to understand how they affect their business. If you have any questions about what the current restrictions mean for your business, please contact our team.

The Toronto Order

The Toronto class order made pursuant to Section 22 (5.0.1) of the Health Protection and Promotion Act (“Toronto Order“), which can be found here, requires owners, operators or occupiers of a business to notify Toronto Public Health via the online COVID-19 Workplace Reporting Tool as soon as they become aware of 5 or more COVID infections in the workplace within a 14-calendar-day period. The Toronto Order grants discretion to the City to order a full or partial closure of the workplace, or shift/work area mass dismissal, when there has been 5 or more confirmed or probable COVID cases within a 14-calendar-day period. Once closed, the owners, operators and/or occupiers of a workplace cannot attend the workplace unless necessary to:

• comply with any applicable laws;
• allow for inspections, maintenance and repairs to be carried out;
• allow for security services to be provided;
• to deal with critical matters relating to the closure of the workplace if they cannot be done remotely; and
• access materials, goods, or supplies that may be necessary for the business or organization to continue to operate remotely.

Licensed child care programs, schools, school boards, healthcare providers and entities are exempt from the Toronto Order. A number of additional workplaces may be exempt from the Toronto Order, including emergency services (fire, paramedics, police), shelters, critical infrastructure, and other workplaces as determined necessary to remain open for reasons of health, safety or otherwise by Toronto Public Health.

Businesses who fail to comply with the order may face a fine of up to $25,000 for every day or part of each day the offence occurs or continues, and individuals may receive a fine of up to $5,000 per day.

Toronto Public Health has not published a timeline for when the Toronto Order will expire.

Neither the Toronto Order nor the Peel Region Order described below prevent businesses from continuing to operate under remote work arrangements.

Asymptomatic workers of businesses that have been ordered to close in Toronto and Peel Region must self-isolate for a minimum period of 10 days, and in Peel Region, for as long as the workplace remains closed.

The Peel Region Order

Similarly, the Peel Public Health Order (“Peel Order“) which can be found here, allows the city to order closure of a workplace with 5 or more confirmed COVID cases within a 14 calendar-day period, if workers could reasonably have acquired the infection at the workplace, or there is no obvious source of infection outside of the workplace. The Peel Order allows the City to order closure for a 10 day calendar period.

The Peel Order requires owners, operators or occupiers of a workplace to notify Peel Public Health at 905-799-7700 or 905-584-2216 (for Caledon) if there are 2 or more COVID cases identified in the workplace within a 14-calendar day period.

As with the Toronto Order, the Peel Order allows for temporary access to a closed workplace, for similar purposes as those outlined in the Toronto Order (i.e. complying with applicable laws, allowing for inspections, etc.). The Peel Order also does not apply to schools/childcare, emergency infrastructure, healthcare facilities, shelters, etc. The potential fines that may be issued against businesses and individuals pursuant to the Peel Region Order are identical to those under the Toronto Order.

The Peel Region Order came into effect as of April 23, and will remain in effect for as long as Peel Region is in the Grey-Lockdown or Shutdown Zone under the COVID-19 Response Framework.

In March 2021, the Ontario Court of Appeal released a long-awaited and precedent-setting decision in Ontario Nurses’ Association v. Participating Nursing Homes, 2021 ONCA 148 (“Participating Nursing Homes“).

Contrary to practices previously endorsed by the Pay Equity Commission, the Court of Appeal determined that public sector employers who achieved pay equity using the “proxy method” have an ongoing obligation to revisit comparator information of the “proxy employer” to maintain pay equity. The matter has been remitted to the Pay Equity Hearings Tribunal (the “Tribunal”) to specify what procedures should be used to ensure that pay equity is maintained under “proxy plans” with ongoing reference to male comparators.

This is the first of a two-part series. Part One will provide an overview of the pay equity maintenance obligation. Part Two will explain how the Court of Appeal’s decision in Participating Nursing Homes affects the pay equity maintenance obligation for “proxy employers” in the broader public sector.

What is Pay Equity Maintenance?

Ontario’s Pay Equity Act (the “Act”) was legislated to address historic gender discrimination in compensation for women employed in “female job classes”. The Act requires all public and private sector employers with 10 or more employees to establish and maintain pay equity. Broadly speaking, pay equity is achieved under the Act when female job classes are provided with “equal pay for work of equal value” (“pay equity”).

Pay equity is distinct from “equal pay for equal work” (“equal pay”). Equal pay compares pay for workers who are in the same (or similar) job, whereas “pay equity” compares the pay provided to workers in different jobs. In particular, pay equity compares compensation provided to “female job classes” and “male job classes”.

The Act provides three methods of comparison to achieve pay equity:

1. the job-to-job method;
2. the proportional value method; and
3. the proxy method.

The job-to-job method and proportional value method involve comparisons between female job classes and male job classes within the same “establishment”. In contrast, the proxy method requires eligible employers to compare their female job classes to female job classes of another employer (“proxy employer”) in a different establishment. The proxy method is less common than the other two methods of comparison because it is only available to certain broader public-sector employers who do not have internal male job classes.

Once pay equity comparisons are made, the Act requires employers to increase the job rates of female job classes to achieve pay equity. After that, the employer must “maintain compensation practices that provide for pay equity” (“pay equity maintenance”). The Act does not provide details for satisfying the pay equity maintenance obligation, so the Pay Equity Commission has developed guidance to assist employers in this regard.

Traditional Approach to Pay Equity Maintenance Under the Proxy Method

Under the proxy method, pay equity is initially achieved by comparing the job rates of female job classes of the “seeking employer” to the job rates of the “proxy employer”. During this initial process, a compensation/value formula (“formula”) is established, in part, by comparing a “key female job class” of the seeking employer to a similar female job class of the proxy employer. Traditionally, however, the Pay Equity Commission has not required employers who achieved pay equity using the proxy method to revisit their proxy employers for updated comparator data (“proxy information”) to maintain pay equity. Rather, seeking employers have only been required to revisit the formula internally, comparing their “key female job class” to their other female job classes. Using this internal pay equity maintenance process, proxy employers must implement pay equity adjustments only when there is a change in the compensation of their key female job class, or a change in the value of any of their female job classes.

Stay tuned for Part Two in which we will explain how the Court of Appeal’s decision in Participating Nursing Homes affects the pay equity maintenance obligation for “proxy employers” in the broader public sector.

Many thanks to Alissa Scarcello for her assistance with this article.