GWL Updates: Government Orders & Termination Provisions

It seems 2021 is off with a bang in the world of employment law, so we thought we would reach out to you with some updates to keep you informed of the changes.

State of Emergency

The Ontario government invoked a state of emergency pursuant to s. 7.0.1(1) of the Emergency Management and Civil Protection Act (“EMPCA”) and Regulation 7/21. 

Under the EMPCA the state of emergency lasts 14 days unless extended for a further 14 day period by the Lieutenant Governor in Council.  At the end of that further 14 day period, the state of emergency can be extended by a further 28 days by MPPs and a vote in Queen’s Park.

Stay-At-Home Orders

The Ontario government has made important announcements about its new “stay-at-home order”, which may impact employers. The stay-at-home order requires everyone to remain at home with exceptions for essential purposes, such as going to the grocery store or pharmacy, accessing health care services, for exercise or for essential work. This order and other new and existing public health restrictions are aimed at limiting people's mobility and reducing the number of daily contacts with those outside an immediate household.

Most notably, the stay-at-home order requires all businesses to ensure that any employee who can work from home, does work from home.

The updated framework can be found in this handy document: https://files.ontario.ca/moh-enhanced-provincewide-shutdown-2021-01-12-v2.pdf. In particular, this document notes:

Work from Home Except Where Necessary- Each person responsible for a business or organization that is open shall ensure that any person who performs work for the business or organization conducts their work remotely, with limited exception, for instance, where the nature of their work requires them to be on-site at the workplace.

We will continue to monitor and provide updates of further changes as they arise.

Case Update: On Termination Clauses in Employee Contracts

As many of you may remember, last summer the Ontario Court of Appeal issued a decision in a case called Waksdale v. Swegon North America Inc., 2020 ONCA 391 (“Waksdale”), that flipped the enforceability of many termination provisions in employment contracts on their head. The Court of Appeal had ruled that an employee’s contract with a  termination agreement that contains a “just cause” provision that contracts out of Ontario’s minimum employment standards laws could render the entire termination provision unenforceable. This meant that many termination provisions in employment agreements could be found to be unenforceable and employers could be liable for greater severance obligations under the “common law”. For some employers, there was still hope as the employer in Waksdale sought leave to appeal of the decision to the Supreme Court of Canada.

This week, the Supreme Court of Canada dismissed the employer’s application for leave to appeal to the Supreme Court of Canada and the case will not be argued further.

What does this mean for employers?

The Ontario Court of Appeal’s decision remains as the current law. As employers, you should take a closer look at your contracts and have them reviewed by legal counsel. It may be necessary for you to refresh your contracts and discuss best strategy on the appropriate way to roll them out for old and new employees, particularly in the unpredictable environment of the pandemic where many employers are facing changes regularly.

We hope that you have found this helpful. As always, you can always reach out to us should you have any questions.