Temporary Layoffs in the wake of COVID-19

By Sean O’Donnell

These blog posts are meant to provide educational content and are not to be taken as legal advice.

How are temporary layoffs being treated differently, if at all, in the face of COVID-19?

Let’s be clear. When an employee is temporarily laid off and there is no layoff provision in the employment agreement or a written agreement to the layoff in advance of same (as well as some other “legal” layoffs), this technically amounts to a constructive dismissal. Further, if the temporary layoff lasts longer than the periods outlined in s. 56(2) of the Employment Standards Act, 2000 (the “ESA”) (in Ontario), this would also be considered a termination under s. 56(1)(c) of the ESA. 

The relevant time periods under s. 56(2) of the ESA are:

  1. No more than 13 weeks in any period of 20 consecutive weeks; and
  2. More than 13 weeks in any period of 20 weeks, if the layoff is less than 35 weeks in any period of 52 consecutive weeks, and certain other criteria are met.

However, Canadians are chartering through unprecedented territory. Will the courts find it “reasonable” for employees to quit and sue for constructive dismissal given the circumstances? Courts may be hesitant to award lengthy common law reasonable notice periods despite there being a “technical” termination. What was considered reasonable four weeks ago may not be reasonable today, or a month from now. When the circumstances change as drastically as they have, courts will be alive to this, adapting accordingly, with all factors being considered. Additionally, how are the courts going to treat mitigation requirements during this pandemic? These are the types of questions that need addressing. 

Although courts have traditionally been employee friendly, in the wake of COVID-19, and its vast impact on essentially all industries and employers, we foresee a balanced approach by the courts which recognizes the unprecedented nature of the social and employment climate. 

It is important to be informed, not afraid, in times like this. No one is immune from this pandemic, and we all have an important role to play. If we do our part, and encourage others to do theirs, we will come out of this stronger and more resilient than before. If you wish to discuss your specific situation, please contact us.