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Ontario’s Employment Standards are Changing: What It Means for Your Business

23/08/2017


​​​​​​On May 30, 2017, the Ontario government introduced legislation (Bill 148, The Fair Workplaces, Better Jobs Act) proposing significant amendments to the province’s Employment Standards and Labour Relations acts. If passed, the legislation will have far-reaching consequences for Ontario’s employers across all industry segments. Highlights of the changes include:     

  • Increases to the General Minimum Wage from the current rate of $11.40 per hour to $14 per hour on January 1, 2018, and then $15 per hour on January 1, 2019. Special minimum wage rates (e.g. for liquor servers, students under 18) will also increase by different amounts.
  • Increases to Paid Vacation - from 2 to 3 weeks for those with over 5 years at the same employer.
  • Expansion of Sick Days (Personal Emergency Leave - PEL) to all workplaces (including those with under 50 employees), with the requirement for two of the ten PEL days to be paid and employers to be prohibited from asking for a doctor’s note.
  • Changes to Overtime Payment Practices requiring that employees with more than one position be paid at the rate for the position they are working during the overtime period.
  • Changes to Shift Scheduling and Payment Practices including:
    • The right for employees to request schedule or location changes and to refuse shifts scheduled with less than 4 days’ notice.
    • The requirement for a minimum of three hours pay if the shift is shortened, cancelled, or an employee is “on-call” and not called in.
  • Equal Wages for Part-Time, Casual, Temporary, Seasonal and Full-Time Employees unless discrepancies are due to a seniority system, merit system, or a system that determines pay by quantity or quality of production or other factors. Temporary Help Agency employees must also be paid equally to permanent employees performing the same job.

How You’ll Be ​Affected
Key potential impacts on Ontario businesses go beyond the direct financial cost and companies need to prepare. The key impacts can be grouped as follows:

  • Increases to Labour Costs due to: minimum wage increases, the introduction of equal pay for all groups of employees (including Temporary Help Agency employees), changes to vacation and sick-leave entitlements, and scheduling and on-call payment requirements.
  • Employee Confusion and Questions: As Bill 148 inches closer to its expected passage there will be more and more media coverage. Employees will understandably become curious about how they might be affected. For example, what if an employee currently makes $15/hr – over $3 more than the current minimum wage. What will happen to their wage in relation to the new minimum wage? 
  • Preparation to Ensure Compliance in a planned way rather than last minute panic. This includes updates to HR Policies, Programs and Processes, preparation of communication materials for management and employees, a clear understanding of the impacts on your organization’s finances, including strategies to mitigate/ off-set the costs.

What can you do now?
The biggest area of action for any business is to assess the financial impact by calculating the increase to salary costs and necessary adjustments to the business financial model. But don’t stop there, businesses should also do their own self-assessment of how each change will impact them by simply creating a list of items you’ll have to look at based on the anticipated changes – e.g., HR Policies to update, or revisions to scheduling procedures.​ In addition, every business should develop a communications plan for what they should say to their employees to help them have the right expectations through the changes. ​ 

How can we help?
Anticipating that the Fair Workplaces, Better Jobs Act (Bill 148) will be tabled this fall, MNP’s Human Resources specialists are watching closely and anticipating how best to prepare for these upcoming changes. MNP will be hosting a webinar in October to help you plan strategically to be compliant, and offer practical steps you can take to make the transition as smooth as possible. 

Alan Lambert, Partner, Consulting Services
T: 416.515.5053
E: Alan.Lambert@mnp.ca