On December 2, 2021, Bill 27, also known as the Working for Workers Act, 2021, received Royal Assent. The omnibus bill introduced a number of amendments to employment legislation in Ontario, including the Employment Standards Act, 2000 (ESA).
With help from Caravel Lawyer, Ben Rovet, we’ve outlined what these amendments mean for businesses in Ontario and the impact they’ll have on business owners and their employees.
- The Right To Disconnect
The Right to Disconnect has been the most publicized of the changes to the ESA. The legislation amends the ESA to require larger organizations to codify or develop a policy regarding employees’ right to disconnect from work. The amended legislation defines “disconnecting from work” as:
“… not engaging in work-related communications, including emails, telephone calls, video calls or the sending or reviewing of other messages, so as to be free from the performance of work.”
The ESA now mandates that employers with 25 or more employees must have a written policy regarding its practices and expectations on disconnecting from work.
Employers with 25 or more employees as of Jan. 1, 2022, must implement this policy by June 2, 2022. From 2023 onwards, employers with 25 or more employees on Jan. 1 of any year must have a written policy in place before March 1 of that year.
The Ontario government has indicated the changes to the ESA do not provide employees with a “new” right to disconnect from work and be free from the obligation to engage in work-related communications. The only express requirement is that employers implement a right to disconnect policy, but, unless later set out in regulations, the legislation does not contain any specific standards or parameters around “disconnecting from work”. The ESA does require that employers include the date the policy was prepared, the date any changes were made, and employers must ensure that it applies to all employees.
It’s at the employer’s discretion to determine the content of the policy, as long as it complies with the existing rights set out in the ESA concerning work hours, break periods, vacation with pay, public holidays and when work is deemed to be performed.
Although the policy must apply to all of an employer’s employees in Ontario (including management and executives), the employer isn’t required to have the same policy for all employees. This means an employer can have different policies to cover different groups of employees.
The government has provided some examples of what the policy might address.
What this means for your business
The substance of these policies is somewhat ambiguous, and as of yet, there is no mention of scope, procedures or consequences for violating the policy. There will hopefully be more direction in the future from the Province on how these policies will be enforced in the workplace. Still, it’s a small step in the right direction for creating common expectations around work-life balance for employees.
In the meantime, employers with 25 or more employees have six months after the day Bill 27 receives Royal Assent (December 2, 2021) to comply with the written policy requirement. During this 6-month period, employers should ensure their policies are updated in line with the ESA regulations and ensure they communicate with employees about this policy update.
- Non-Compete Agreements
Effective October 25, 2021, employers are prohibited from entering into employment contracts or other agreements with an employee that include a non-compete agreement.
A non-compete agreement is defined as:
“an agreement, or any part of an agreement, between an employer and employee that prohibits the employee from engaging in any business, work, occupation, profession, project or other activity that competes with the employer’s business, after the employment relationship between the employee and the employer ends.”
The new legislation prohibits entering into non-competition agreements before the employment relationship begins, during the employment relationship, and after it ends.
There are two exceptions to this requirement: upon the sale or lease of a business and for those who hold the title of chief executive or president.
What this means for your business
Prior to this amendment, non-competition clauses were already extremely difficult to enforce under common law, and courts were reluctant to support what is often described as ‘restraint of trade.’
Now that this new legislation expressly prohibits employers from entering into non-compete clauses, business owners should review existing employment contracts and ensure any non-compete clauses are removed if they’re no longer valid.
They should also review job titles and job descriptions to ensure those in an executive position meet the definition of “executive” under the new legislation.
Ensuring your organization is covered for Bill 27
If you need help ensuring your employment contracts align with the new Working for Workers legislation, we can help. Caravel has over 70 qualified and experienced lawyers, including those specializing in employment contracts. Get in touch with our team to find out more.