Bill 148 overhaul affects public holiday pay, employee leaves, minimum wage
Editor’s note: The Ontario government passed Bill 47 on Nov. 21. The Making Ontario Open for Business Act received royal assent the same day.
Payroll professionals in Ontario will have to adjust to more employment standards changes if proposed amendments become law.
The provincial government has tabled a bill that would repeal a number of amendments to the Employment Standards Act, 2000 that the previous government implemented earlier this year through Bill 148, with some changes scheduled to take effect in 2019.
The government said new Bill 47 would eliminate provisions in labour laws that are too burdensome for employers and that stand in the way of job creation.
“The Making Ontario Open for Business Act, 2018, will, if passed, remove job-killing regulatory burdens for businesses while continuing to maintain strong protections for workers,” said Jim Wilson, then-minister of economic development, job creation and trade, when he tabled the bill on Oct. 23.
“This legislation will broadly repeal certain changes to employment standards and labour relations that the previous government made through Bill 148.”
Payroll-related amendments in Bill 47 include:
Public holiday pay: The formula for calculating public holiday pay would legislatively revert to the one used before Bill 148 took effect on Jan. 1, 2018. That formula requires employers to calculate public holiday pay as the total amount of regular wages earned and vacation pay payable to an employee in the four workweeks before the one with the public holiday, divided by 20.
Employers have been using the formula since July 1 after the Ministry of Labour temporarily reverted to it while reviewing public holiday pay and problems with Bill 148’s formula that employer groups and the Canadian Payroll Association raised.
The Bill 148 formula required employers to calculate holiday pay as the total amount of regular wages that an employee earned in the pay period immediately before a public holiday, divided by the number of days the employee worked in that period.
There were complaints that the formula was complicated, that it over-rewarded part-time workers, and that it caused problems when calculating pay for some commission employees.
While the formula proposed in Bill 47 has been criticized in the past for being too complex, the ministry said it is a formula with which most employers are already familiar.
With the previous formula to be re-inserted in the employment standards legislation, it is not yet known if the Ministry of Labour will continue with its review of public holiday pay.
Leaves: The bill would eliminate personal emergency leave and replace it with specific leaves for sickness, family responsibility, and bereavement. Personal emergency leave provides employees with up to 10 days off each year to deal with personal and family health issues and other urgent matters. Employers must pay employees for the first two days of the leave.
The new leaves would be unpaid. They would provide up to three days of sick leave, three days of family responsibility leave, and two days of bereavement leave. Bill 47 specifies which family members would be covered for the leaves, including the employee’s spouse, children, parents, grandparents and grandchildren.
Minimum wage: The general minimum wage rate would remain $14 an hour and there would be no further rate increases until Oct. 1, 2020, when the rate would go back to being indexed to inflation. Under the previous government, the general minimum wage rate was slated to rise to $15 on Jan. 1, 2019.
Other minimum wage rates, such as the student rate and the liquor server rate, would also remain at their current levels.
Equal pay for equal work: Bill 47 would eliminate provisions that prohibit employers from paying part-time, casual and temporary employees at a lower pay rate than their full-time employees when the workers do the same work in the same workplace, under similar conditions and the work requires the same skill, effort, and responsibility. It would also eliminate a similar prohibition related to employees working for temporary help agencies. The provisions have been in place since April 1.
Employers would continue to be required to provide equal pay for equal work on the basis of sex.
Scheduling: The bill would repeal a number of scheduling requirements due to come into force on Jan. 1, 2019. Provisions affected include those that would give employees the right to request changes to their work schedule or work location and allow them to refuse to work or be on call on a day that they were not already scheduled if their employer did not give them at least 96 hours of advance notice.
Bill 47 would also repeal provisions that would require employers to pay employees three hours of pay if they cancel a scheduled shift or an on-call shift with less than 48 hours of notice.
Another provision to be repealed would require employers to provide at least three hours of on-call pay if employees were available to work, but were not called in or were called in, but worked fewer than three hours.
Bill 47 would require employers to pay employees for three hours if they regularly work more than three hours a day and are required to report for work, but work fewer than three hours.
Business groups had complained that the previous government’s scheduling provisions were too onerous and would take away their flexibility to set work schedules.
Some of the changes in Bill 148 would remain intact, including a requirement that employers provide employees with at least three weeks of paid vacation after five years of service with them.
Enhancements to parental leave, family medical leave and critical illness leave that align with employment insurance rules would also remain in place, as would the right to a job-protected leave for domestic or sexual violence.
Reaction to Bill 47 has been mixed from business and labour groups, respectively.
“The government of Ontario is taking the right steps in building labour legislation that is both reasonable for employers and fair to workers,” said Rocco Rossi, president and CEO of the Ontario Chamber of Commerce.
“As Ontario’s business advocate, our position has always been clear: Bill 148 was too much, too fast. The compounding labour reforms and unintended consequences came at too high a cost to Ontario’s economy.”
The Canadian Federation of Independent Business (CFIB) also praised the government, saying that many small companies without an HR department faced challenges trying to comply with Bill 148’s requirements.
“Since Jan. 1, businesses have been struggling to manage not only a 21 per cent increase in the minimum wage in only three months, but also a multitude of other major labour changes,” said Plamen Petkov, CFIB’s vice-president for Ontario.
In contrast, workers’ rights advocates called Bill 47 a betrayal of workers.
“Fair scheduling, equal pay for equal work, paid sick days. These rights are not frivolous — they are (a) practical, minimum standard for fairness,” said Jerry Dias, president of Unifor.
“Perhaps the most mean-spirited is the fact that the government has said they will freeze the minimum wage for two years. This is a real-dollar wage cut that will make life harder for millions,” said Pam Frache, co-ordinator of the Workers’ Action Centre in Toronto.
The Ontario branch of the Canadian Union of Public Employees (CUPE) called on the government to reverse course.
“(Bill 47) will hurt thousands of working people, hurt their families and it will ensure that Ontario’s economy only benefits those at the very top,” said Fred Hahn, president of CUPE Ontario.
“If the premier really wants to protect workers, he will rethink his plan.”
The proposals in Bill 47 would take effect on the later of Jan. 1, 2019, and the date the bill receives royal assent.
