Top 20 Employment Law Frequently Asked Questions

Author’s Note: This article is written to address the questions of provincially regulated employees in a non-unionized setting. 

Employment law can be overwhelming to understand, that’s why the team at SV Law has dedicated this month’s blog to answering the Top 20 Employment Law FAQs that we are asked most often.

Keep reading to shed some light on this topic.

1. Do I need an employment contract? 

The Employment Standards Act, 2000 (“ESA”) is commonly referred to as “minimum standards legislation”, meaning that provisions apply with or without a written contract and parties are not able to work around the provisions set out in the ESA. 

The ESA stipulates and enforces minimum employment standards (with certain exceptions based on the field of work) that apply whether or not a written employment contract exists. As such, a written employment contract is not required. That said, both employers and employees can benefit from having clear written terms that outline the employment relationship. 

2. When should an employment contract be signed? 

An employment contract must be signed prior to the employee commencing employment. Failure to sign the contract before the employee starts working can cause the contract to be unenforceable. 

If an employment contract is provided/signed after an employee has already been working for the employer, the employer should give the employee something of value, (legally called “consideration”), such as a signing bonus, in order to make the contract enforceable. Determining the adequacy of such a consideration will vary in every case. It is recommended to consult an employment law lawyer before presenting employment contracts to existing employees. 

3. How much time should an employer provide an employee to review an employment contract?

There is no rule or minimum time required, however, employers should give employees a reasonable amount of time to review an employment contract so they may seek independent legal advice, if they wish to do so. Generally speaking, a few days should be considered as a minimum.

4. Do employers need to have an employee handbook? 

Although many employers have an employee handbook which usually contains various employment policies, it is not a mandatory requirement. However, there are certain employment policies that are required, such as a workplace harassment policy and program. The Ministry of Labour can fine employers who do not have mandatory policies in place, or who do not keep them up-to-date. 

5. Are employers obligated to investigate reports of workplace harassment? 

Yes, the Occupational Health and Safety Act, requires employers to have a workplace harassment policy and program that sets out how incidents or complaints of workplace harassment will be investigated and addressed. 

6. What is the difference between “notice” and “severance”? 

When an employee is terminated without cause, i.e. in the absence of misconduct, the employee is entitled to a notice of termination or pay in lieu of notice. In addition to notice, an employee may be entitled to severance pay, as outlined in the ESA, if certain criteria are met. Severance usually only applies to employers with a large payroll. You can read more about the notice of termination, severance, and termination pay in our previously published article here. 

7. What is working notice?

As stated above, when an employee is terminated without cause, the employee is entitled to notice or pay in lieu. If an employee is entitled to four weeks of notice, the employer can notify the employee that their employment will be terminated in four weeks time and let the employee continue to work through that period. This four week period of work is referred to as “working notice”. Alternatively, the employer can notify an employee that their employment is being terminated immediately and pay the employee the wages that would have been earned during the four week notice period.

8. What is “common law reasonable notice”? 

The common law is the law developed by the courts. Judges have formulated a framework for awarding notice that is different from what is set out in the ESA. Employers often try to limit employees’ entitlement to common law reasonable notice because it is typically greater than the minimum notice required by the ESA. 

If an employee does not have an employment contract with a carefully crafted termination provision, the courts may rule that reasonable notice of termination is required. Reasonable notice is determined on a case-by-case basis and is dependent on the circumstances and a number of factors such as length of service, age of the employee, character of employment, and availability of comparable employment. You can read more about common law reasonable in our article here. 

9. When can an employer deem that an employee has resigned?

In most cases an employee will clearly communicate their resignation with written notice to their employer. However, in some circumstances it is not as clear, such as an employee who has engaged in an unexplained absence from work. 

Whether the employee’s conduct amounts to a resignation is determined on a case-by-case basis considering all of the facts. Canadian courts have held that an employee’s resignation must be voluntary, clear, and unequivocal in order to be used as a defence to a wrongful dismissal case. If there is uncertainty or confusion regarding a resignation, the employer has a duty to act in good faith to take steps to determine the employee’s intention. 

10. How much notice does an employee have to give when resigning? 

Employees are required to provide their employer with reasonable notice of their resignation. This requirement is intended to permit an employer to make arrangements for the employee’s departure and minimize disruption to the workplace. There is a common belief that employees are required to give two weeks notice of resignation, but this is not a written rule that applies to most circumstances.

11. Can an employee on disability or medical leave be fired? 

Technically yes, however, employers need to be very careful as dismissing an employee who is on a medical or disability leave, or on modified duties, may give cause for an Ontario Human Rights Code Application. 

Employers should only terminate an employee on medical leave with the guidance of an employment law lawyer. The employer must show, with evidence, that the employee’s disability was not a factor causing termination, (for example, where the company is dissolving and all employees are being dismissed). 

12. Does an employer need cause to terminate an employee? 

No, an employer can terminate an employee for any reason so (i) long as the employer provides adequate notice or pay in lieu of, and (ii) the reason for termination does not amount to a violation of the Human Rights Code or the Occupational Health and Safety Act (i.e. discrimination, retaliation, etc.)

An employer will have to provide the employee with proper notice of pay in lieu thereof, except where the employer has sufficient grounds to terminate an employee with cause. The standard for dismissal with cause is very high. In most cases that do not involve gross misconduct on the part of the employee, the standard for a dismissal with cause will not be met. 

Employers are strongly encouraged to consult an employment law lawyer before terminating an employee with cause. Similarly, employees who have been terminated with cause should consult an employment law lawyer if they suspect that their employer did not have adequate grounds to support a dismissal with cause. 

13. Are employees entitled to EI benefits if they have been fired?

Employees who have been dismissed with cause will not typically be entitled to EI benefits. However, an employee that is dismissed with cause may be entitled to EI benefits if Employment and Social Development Canada believes that there is insufficient grounds to justify a dismissal with cause. More information about EI eligibility can be found online here. 

14. How much vacation time are employees entitled to? 

Employers and employees are free to negotiate an employee’s vacation entitlements provided that the arrangement complies with the minimum vacation entitlements set out in the ESA. This law outlines that an employee with less than 5 years of service is entitled to two weeks of paid vacation and employees with five or more years of service with the same employer are entitled to 3 weeks of paid vacation.

15. What should an employer consider before going “pet-friendly”? 

Many employers are intrigued about how furry, four-legged friends can boost workplace morale and productivity. However, there are a number of considerations that an employer should consider before going pet-friendly. More information about what should be included in an employer’s pet-friendly workplace policy can be found in our article here. 

16. How do I fill out an ROE for a departing employee? 

Block-by-block instructions for completing a Record of Employment can be found on the Government of Canada’s website, here. 

17. Where can I find reliable information about the Employment Standards Act, 2000?

A basic guide to Ontario’s employment laws can be found on the provincial government’s website here: Your guide to the Employment Standards Act.

18. What is constructive dismissal? 

Constructive dismissal is sometimes referred to as a “forced resignation”. Constructive dismissal can arise when (i) the employer breached an express or fundamental term of the employment contract, which may or not be in written form, or (ii) the employer’s conduct demonstrates a clear violation of the employment contract. In either of these circumstances, the employee may resign as a result of the employer’s conduct and can alleged that the resignation was not voluntary, and it is, in effect, a termination. The employee will be responsible for proving that they were constructively dismissed. If the claim of constructive dismissal fails, the employee will be found to have terminated the employment relationship voluntarily and will not be entitled to any wrongful dismissal damages. Some examples of conduct that may give rise to constructive dismissal are: a demotion, a substantial reduction in compensation, or an intolerable workplace. 

19. Is everyone entitled to the same minimum wage? 

Most employees are eligible for the general minimum wage, which is currently $14.00 per hour in Ontario. However, students, liquor servers, homeworkers, hunting, fishing, and wilderness guides all have different minimum wage rates. More information about minimum wage can be found online here. In addition, the Employment Standards Self-Service Tool may be used to check compliance with rules on minimum wage.

20. Are there special laws for certain types of employees? 

Yes. Unionized employees are governed by a collective agreement and the Ontario Labour Relations Act. A collective agreement is a written agreement that sets out the employment terms and conditions for unionized employees. The union and the employer must also file a copy of the agreement with the Minister of Labour. Collective agreements are published on the Collective Agreements e-Library website.

In addition, federally regulated employees, such as bank employees, are subject to different statutes and rules. 

For any matters relating to employment law, SV Law’s team of experienced lawyers are available to help. If you have questions or feel that you have been treated unfairly, contact us here or call toll-free at 866-316-9569. (link number in mailchimp)

Written by Marni Outerbridge & James Prosser