April 22, 2020

McLennan Ross Update for Wednesday

By McLennan Ross Labour & Employment Team

What we are seeing

  • The Government of Canada has posted a summary of key information for employers regarding the Canada Emergency Wage Subsidy (CEWS). This summary assists in determining who is an eligible employer, how to determine if there has been sufficient reduction in eligible revenue of a business to qualify for the subsidy and how to determine eligible revenue. The summary can be found here.
  • The Government of Canada has also provided information regarding the changes to the Canada Summer Jobs program, including an increase in the percentage of wages to be reimbursed, the ability to offer part-time placements and an extension of the eligible employment period. This additional information can be found here

 What we are hearing

  • Employers are looking for guidance on how to operate and still be in compliance with Occupational Health and Safety rules and restrictions. Alberta Occupational Health and Safety has provided some limited general guidance to assist employers. A more fulsome source of information may be found at the Canadian Centre for Occupational Health and Safety website here. CCOHS has recently published a number of tip sheets by industry which employers may find more useful than the generic provincial guidance.

 What we are saying

  • There was a recent article in The Globe and Mail regarding what an employee can do if an employer is perceived as using COVID-19 as an excuse to get rid of that employee. The responses provided by the two non-management side lawyers were in the context of a layoff as opposed to an immediate termination and were generally unobjectionable. One of the lawyers rightly acknowledged that absent a reason that would be considered discrimination, an employer does not need to provide a reason to terminate an employee on a without cause basis. The other suggested that a temporary layoff absent a legitimate business need due to the pandemic is likely a constructive dismissal, which is also arguably correct in that factual vacuum. It is perfectly legitimate for an employer to terminate an employee based on COVID-19. 
  • Our frequent recommendation to employers is to not advise employees of the reason for a without cause termination, other than in general terms. The current state of emergency does not dictate a deviation from this general practice, although it is usually easier for employees to understand if they are being terminated for economic reasons, as opposed to specific concerns or problems with their performance. For a temporary layoff, the Alberta Employment Standards Code does not require economic justification, or indeed any justification, for an employer to rely upon the Code’s temporary layoff provisions. The Code only states that the employer can issue a temporary layoff notice to maintain an employment relationship with the employee who is being directed not to come to work. Note that we have warned previously that the issuance of a temporary layoff notice – whether due to COVID-19 or under any other circumstance - could be considered constructive dismissal despite being permissible under the Code, depending on the circumstances. Read the full article here.
  • A point missed by the two lawyers in The Globe article is that practically, it would likely be against the best interests of the employee to push the point and argue that the termination or layoff was not due to COVID-19. Some of the emergency relief supplied by the Government of Canada for terminated or laid off employees, such as the Canada Emergency Response Benefit, is expressly stated to be available only to “eligible workers who have lost their income due to COVID-19.”

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