June 17, 2020

McLennan Ross Update for Wednesday

By McLennan Ross Labour & Employment Team
What we are seeing
  • The Federal Government announced that the Canadian Emergency Response Benefit (CERB) is being extended by two more months. Although the Government is attempting to encourage people to look for jobs and to go back to work when possible to do so, it stated that it wanted to ensure the financial safety net of the CERB was not removed too early. The government stated that it will strengthen the attestation recipients must complete stating that they are actively seeking work. It will be necessary to monitor if they continuation of the CERB results in Alberta employers reopening their businesses and finding a shortage of available labour despite the unemployment rate of over 15%.
  • The Alberta Government introduced Bill 24 (COVID-19 Pandemic Response Statutes Amendment Act, 2020) today. Among other things, this legislation extends the temporary layoff period from 120 days to 180 days. Though this legislation has just been introduced, and still must be passed, it will be effective today. 
  • Alberta's state of public health emergency, which had been in place since early March, lapsed on June 15, 2020. The declaration of a state of public health emergency under the Alberta Health Act permitted the Alberta Chief Medical Officer to issue a number of public health orders to be followed by Albertans to respond to the emergency. The declaration also granted the Government of Alberta the power to suspend, modify, or temporarily replace the application or operation of all or part of an enactment. The Government used this power to pass Ministerial Orders that modified such legislation as the Employment Standards Code and Regulations.
  • The Lapsing of the state of public health emergency does not result in the termination of the public health orders or the Ministerial Orders. The public health orders expressly state that they will remain in place until rescinded by the Chief Medical Officer. The power to grant the Ministerial Orders under the Alberta Health Act expressly allows the Orders to continue in effect for 60 days after the expiry of the state of public health emergency. Most of the Ministerial Orders state that they will remain in effect (unless extended by further Order) until the earlier of August 14, 2020 or 60 days from the date of the lapsing of the state of public health emergency unless expressly terminated earlier by the Government of Alberta.

What we are hearing
  • British Columbia has been slightly ahead of Alberta in the reopening of its economy and is slowly moving toward Stage 3 of its plan. It may be a good indication of what Alberta will experience as it moves through Stage 2 of its own strategy.
  • Key information from B.C. includes:
    • The number of new cases has stayed static for the past 10 days and has remained under 20 per day. Compare this with Alberta, which is still seeing new cases between 30 and 50 per day, although it has recently dropped to around 20; 
    • There have been no cases of COVID-19 connected to schools reopening on June 1, 2020;
    • Group gatherings remain limited to a maximum of 50 people with room for physical distancing, and this looks to remain a reality in the months to come; and
    • The next phase could be in late June or July, but will be entirely dependent on the number of new cases at that time.

What we are saying
  • With the widespread impact of the pandemic on Alberta businesses, historically unusual requests for changes to how business has been conducted may now seem understandable. This state of flux appears to have created a situation where cyber criminals are attempting to benefit. 
  • We have seen a proliferation of cyber fraud where criminals have hacked the email system of a supplier of goods or services. The hacker then mirrors an existing and legitimate email account and starts to send emails to clients advising that due to some issue, the company has had to change its banking information and that all future payments should be sent to a new bank account, which belongs to the hacker. The hacker also sets up a rule within the email account such that all replies to the fraudulent emails sent out by the hacker will be automatically be forwarded to the hacker and deleted from the legitimate email account. 
  • In some instances, because the email is coming from a legitimate email account, the request to direct payment to the hacker's bank account is successful, causing a loss. 
  • Businesses should be aware of this cyber fraud and direct employees to verify via telephone any request to change banking details. Businesses should also consult with their insurance brokers to discuss this and other new types of cyber fraud to ensure that they know the extent of existing coverage. To date, there is no case that allocates liability for a loss such as the above between the supplier whose email account was hacked and the customer who did not verify the change in banking information. 
  • If you require assistance in determining the extent an existing policy provides coverage against cyber security incidents or have questions regarding the sufficiency of your policy more generally, please contact someone in the McLennan Ross LLP Insurance and Risk Management Group.

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