So you have been laid off, what are your options?
News broke last week that more than 500,000 Canadians applied for EI within a few days. With layoffs rolling out widely as a result of the economic impact of Covid-19, we are writing this blog to provide some basic information on workers’ rights and options.
(The blog is relevant only to non-union workers in provincially regulated industries in professions/occupations/industries covered by the Employment Standards Act. This information will apply to most non-union workers in BC.)
You may not have to accept a temporary layoff
This might seem like a ridiculous statement. You cannot insist on keeping your job or getting paid, so by refusing a temporary layoff, what that likely means is your employment will end permanently. The upside to a permanent termination of employment is you may be entitled to severance pay, which can range from very little or nothing (if you have worked a short time in an entry level position) to up to 24 months’ pay (in exceptional circumstances). Talk to an employment lawyer to understand how much you might be owed, as it is fact specific and depends on the Employment Standards Act, your employment contract, and your age, length of service, nature of your job and availability of alternative employment.
There are some real downside risks to refusing a temporary layoff and hoping for severance pay.
- Your job is over permanently, and you will not have a job to return to when your employer rebuilds capacity or reopens.
- If your employer can prove that Covid-19 has been an unforeseen circumstance that has made continuing your employment “impossible,” it may be found that no severance pay is owed under Section 65(1)(d) of the Employment Standards Act.
- Severance could be difficult or impossible for your employer to fund and if many employees refuse layoffs and insist on severance, this could be the last straw that makes them go under.
- If your employer does not agree to pay, enforcing severance pay rights beyond the Employment Standards Act minimums will be slow and difficult in the coming months, with courts largely shut down.
If you accept the temporary layoff, apply for regular EI right away
There is a huge demand on our Employment Insurance system right now, so make sure you get your application in ASAP. While expansions of coverage have been announced, based on the EI system that has always been in place, you likely currently qualify for EI if you:
- have been laid off due to shortage of work;
- have at least 700 hours of insurable earnings in the last 52 weeks (700 hours is for the Vancouver region and the number of hours to qualify varies across the Province); and
- have experienced an “interruption of earnings” which means no work and no pay for 7 days.
You can work to supplement EI after 7 calendar days of no work and no earnings
Once your EI begins, you can take on work to supplement EI. Remember, you must have 7 days of no work and no pay to be eligible for EI, so wait this out before taking on any work. Jim Wu of our office wrote a detailed article on LinkedIn about how working while EI impacts your claim here: https://lnkd.in/gYXbv7D. We will be posting this article on our website shortly.
If you accept a temporary layoff, it ends after 16 weeks
The BC Employment Standards Act limits temporary layoffs as a result of Covid-19 to 16 weeks maximum (extended from 13 to 16 weeks, effective May 4, 2020). At that point, employers will need to provide termination pay unless they have returned you to work. As discussed above, it is possible that Section 65(1)(d) of the Act will apply to mean no termination pay is owed if there is an “unforeseen circumstance” that has made continuing your employment “impossible.” This exception could also potentially apply at the end of the 16 week layoff period.
We have written a few other blogs on Covid-19 layoffs which you may also find helpful, available at https://fortelaw.ca/blog/
This blog is not intended to serve as legal advice, and only provides general information. Every situation must be considered on its own facts.
Need legal advice? Contact us by phone at 604 535-7063 or email [email protected].