Work Refusals and Covid-19: Risky Business Indeed

Work Refusals and Covid-19: Risky Business Indeed

Covid-19 has put workers and employers in a difficult position.  Many have lost their jobs, and others find themselves trying to work remotely for the first time, surrounded by their school-aged children. But what about those still going in to work?  Some workers are feeling afraid and uncomfortable, watching those around them be told to stay home, while they go out into a minefield.

What happens if a worker refuses to go to work?  For this blog, we will assume that the employer has done everything right in terms of complying with WorkSafe BC and Public Health Authority recommendations.  But the worker still feels uncomfortable.  What happens if that worker refuses to work or walks away from their job?

 

Refusal to work can be a quit

Repeating our assumption that the employer is complying with all government recommendations and requirements, fear or discomfort alone does not give the worker the right to refuse to come to work. If an employer is willing to continue employment, but the worker refuses to work out of fear or discomfort, then they may be in effect quitting their job.  This would mean employment and all benefits come to an end, with no termination or severance pay.

There would be exceptions to this if the worker falls within the new protected leaves under the BC Employment Standards Act.  For example, if they are uncomfortable coming to work, AND they have minor school-aged kids at home that need care.  In this case the requirement to care for children would be the basis for an unpaid leave from work, and the worker may be eligible for CERB.

 

CERB can be lost due to work refusal

Today, applications for CERB opened, to the great relief of many.  Under the current legilsation, Canada Emergency Response Benefit (“CERB”) is payable to workers who have “ceased working for reasons related to COVID-19” for at least 14 straight days.

When considering refusing to work due to fear or discomfort, workers need to understand that CERB may be denied or clawed back.  The legislation specifically states that quitting a job voluntarily does not meet the requirement of “ceased working for reasons related to COVID-19.”

 

EI can be lost due to work refusal

For many workers, Employment Insurance (“EI”) would be available if they were laid off due to lack of work or went on a medical leave.  EI is generally not available to a worker who quits.  The exception to this is a worker may quit and still get EI if they are able to prove that they had “just cause” to leave that job. What is “just cause” to quit your job and still get EI?  To paraphrase a Federal Court of Appeal judge, just cause means convincing the Canadian taxpayers that they should pay you money for your decision to become jobless. That sounds like a high bar to meet, but it is not impossible.

Under EI law, you may have “just cause” to quit your job if you can prove two things:

  • Your workplace was a danger to your health and/or safety; and
  • You had exhausted all reasonable avenues before quitting.

A work refusal due to fear and discomfort, rather than an objective safety risk, is not likely to be “just cause.”

 

Work refusals are risky for workers and employers

The stakes are very high for workers and business for work refusals.  We recommend that any worker considering a refusal to work get good legal advice before taking that step.  A loss of access to 16 weeks of CERB is $8,000, not to mention loss of potential severance pay.

For employers faced with a work refusal, there is also risk.  With the changing workplace safety requirements, it can be hard to know if you are compliant.  Any negative treatment of a worker after they make a safety complaint could be a Discriminatory Action, and get you in hot water with WorkSafe BC.  If you are aware that the worker could be entitled to a protected leave and ignore that, there is risk of an Employment Standards complaint.

Need help navigating work refusals?  We advise both workers and employers with proactive advice to avoid large losses down the road.

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].

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Forced Vacation Time? Another Covid-19 Consideration

Forced Vacation Time? Another Covid-19 Consideration

Can an employer require employees to take vacation time where is a slowdown in work? This is a question we are getting regularly from workers and businesses.  There is no simple answer, but we have set out some information below.

(This 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.)

Can an employer force its employees to take vacation?

Maybe. Look at the employment contract and any vacation policies and see what they say about vacation scheduling. Unless the contract or policy gives the employee the right to choose their vacation time, then yes, employees can be forced to take vacation if work is slow. The BC Employment Standards Branch says this:

Employers can choose when employees take vacation. You must schedule an employee's vacation in periods of one week or more, unless they ask for a shorter amount of time.

An employee earns annual vacation during the first year they're employed. After 12 months, they get two weeks of vacation. After five years, they get three weeks of vacation.

Employers may:

      • Cancel employee vacations due to a shortage of employees
      • Require employees to take vacation if there isn't enough work for staff

How does forced vacation impact layoff or termination?

Whether you are an employer or employee you should keep these provisions of the Employment Standards Act in mind as well:

Scheduling Vacation

Section 67(1) prohibits an employer from scheduling an employee’s vacation to coincide with notice of termination of employment.

Section 59 of the Act prohibits an employer from granting time off as a bonus or sick time and later reducing an employee’s vacation entitlement as a result of the previously granted leave.

If the employee is going to be let go permanently, vacation has to be paid out and cannot be scheduled to coincide with termination notice or lay, per section 67(1) of the Employment Standards Act.

Will vacation impact Employment Insurance?

Employees and employers should consider the Employment Insurance ramifications of taking vacation or forcing employees to take vacation if layoffs are expected.  If the employee is going to be temporarily laid off but eventually return to work, forcing them to take their vacation before the lay-off will delay their 7 day “interruption in earnings” of no work and no pay, which is required to qualify for E.I. Employees may also want to keep some vacation time for after things start up again.

 

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].

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So you have been laid off, what are your options?

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.)

  1. 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.
  1. 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:

  1. have been laid off due to shortage of work;
  2. 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
  3. have experienced an “interruption of earnings” which means no work and no pay for 7 days.

 

  1. 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.

  1. 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].

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E.I. and Covid-19 Layoffs

E.I. and Covid-19 Layoffs - 5 Tips for Workers and Businesses

 *This blog post is current to 8:00 AM on March 17, 2020. Forte Law is offering virtual legal services, including zoom video meetings or telephone consultations, so you can get legal advice from your home or office. *

As many workers and businesses are facing the idea of layoffs for the very first time, understanding the basics of Employment Insurance (E.I.) can be helpful.

Employees may be eligible for Employment Insurance (“E.I.”) benefits if they meet the following:

  1. They have experienced an IOE. An Interruption of Earnings or IOE is where an employee has had 7-straight days of no work and no pay with an employer.
  2. They have worked at least 700* hours in the last 52 weeks (about 5-straight months of full-time work)

*This is the amount needed in Metro-Vancouver. For other regions please check here.

As we each do our part to flatten the curve, we offer employees and employers the following 5 tips to help each other navigate through these difficult times.

 

Employees

  1. If you have experienced an IOE or believe you will, apply for EI ASAP.

It takes time for your EI claim to be processed. You can apply even if you don’t have your ROE, click on this link, scroll down to the very end and click "apply online". There will be a huge demand for EI, so get your application in early.

That said, if your hours are reduced or you have been out of work for less than 7 days, you should think twice before applying, since you have not met the qualifying conditions and may not be eligible for E.I.

  1. Create a MyServiceCanada account

You can create your MyServiceCanada account once you have submitted your application and received your 4-digit access code in the mail. MyServiceCanada account lets you see your ROE, the status of your claim, how much EI you get paid, and how long you can get paid.

  1. Stay on top of your EI Reports

You must continue to complete your EI Reports in order to get paid. You can complete them online

  1. Look for work while you are collecting EI

You have a legal requirement to do so if you wish to continue collecting E.I.

  1. You are allowed to work part-time and still be paid E.I. in some circumstances

See explanation here.

 

Employers

  1. ROEs can only be issued after an IOE

If you are laying off an employee because of a temporary closure, the employee will need to have gone through 7 days without work or pay before you can issue the employee an ROE. ROEs that are issued before an interruption of earnings has occurred may require verification from an E.I. Agent and can delay an employee’s E.I.

  1. Consider issuing web ROEs

This is a stressful time for your employee to be out of a job and the last thing they want is to have their EI delayed because of a missing ROE - submit the ROE online - that way everyone (the employee, yourself, and Service Canada gets a copy).

  1. Complete the ROE correctly

If you are laying off employees, complete Block 16 with code "A" and check off either “unknown” or a specific date in Block 14. Make sure you don't check off "not returning" as this can be seen as a termination of employment.

  1. Issue the ROE on time

You have 5 days after the employee experiences an “interruption of earnings” to issue an ROE, so this means you would issue them between 7 and 12 days after the layoffs.

  1. Consider offering some work for employees who are a few hours short of the insurable hours minimum

At present, the law is clear: if an employee does not have enough hours, they will not get E.I. even if they are one hour short. While employers are under no obligation to do so, offering an employee a few more hours of work so that they have enough insurable hours to qualify for EI can go a long way in helping out an employee. Generally speaking, a happy employee is less inclined to sue their employer.

 

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].

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Covid19 Layoffs What are the Rules

Covid-19 Layoffs in BC – What are the Rules?

*This blog was revised effective May 7, 2020*

We have seen the economic impact of Covid-19 in BC, with industries like travel and many others in crisis.  Layoffs have been happening in many sectors, and more could be coming.  What are the rules?  The rules about temporary layoffs have been well-established in BC for many years.  The BC government has recently provided some guidance on how these rules should be applied during the Covid-19 pandemic.   With our courts closed, it will be some time before we will be able to predict how judges will view this issue, taking into account Covid-19’s health and economic impacts.

(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.)

  1. Layoffs (permanent or temporary) generally trigger severance pay

In almost all employment relationships, it has long been the law that a temporary or permanent layoff triggers a worker’s right to severance pay and so is the same as termination, being “let go”, or “getting fired.”  The primary exceptions to this have been temporary layoffs in industries where temporary layoffs are the norm, if you have a written employment contract that includes the right to temporary layoffs, or if the employee agrees to the temporary layoff.  If permitted, 16 weeks (extended from 13 to 16 weeks, effective May 4, 2020) is the longest a “temporary layoff” can be per the Employment Standards Act before termination pay must be provided.

But what if Covid-19 has made the contract of employment “impossible to perform”?  Read on.

  1. Economics or financial circumstances of the business are not relevant, unless the employment contract is “impossible to perform” or the contract has been “frustrated”

To date, economic circumstances of the business have not generally been taken into account in determining whether or how much termination notice or pay is owed.  Even if a business was closing, termination notice or pay was required, and the amount was not impacted.  Now there is a question of whether a little-used section of the Employment Standards Act might apply to relieve the requirement for termination notice or pay for some businesses impacted by Covid-19.  Section 65(1)(d) of the Act states that notice of termination or pay in lieu is not required when the employment contract is “impossible to perform due to an unforeseeable event or circumstance.”

The BC government has issued a statement saying that decisions about whether section 65(1)(d) applies during the Covid-19 pandemic will be made on a case-by-case basis.  The exception may apply where a business closure or staffing reduction is directly related to Covid-19 and there is no way for employees to perform work in a different way (for example, by working from home).  The exception will not apply if an employer terminates an employee for reasons that are not directly related to Covid-19 or if the employee’s work could still be done in another way (perhaps by working remotely).  This means that in order for section 65(1)(d) to apply, the employer will still have to prove that the contract was “impossible to perform.”  Impossibility is a high standard, and while it could be met for a business ordered to shut down, it may not apply where a business still has work and is rolling out layoffs in anticipation of future work slowing.

Section 65(1)(d) of the Act only applies to determine whether the minimum termination notice or pay of up to 8 weeks is owed under the Act.  It is difficult to predict whether our courts will also find a way to relieve businesses from common law severance pay obligations.

There is speculation about whether Covid-19 may cause a “frustration of contract”.  Frustration occurs in employment contracts where through no fault of the employee or the employer, the essence of employment (work in exchange for pay) is impossible. Prior to Covid-19, uncertain economic conditions or employer finances were not considered a “frustration of contract” to justify dismissal of an employee without notice or severance, but it is hard to predict what our courts will do in future with this.

  1. How much notice of termination or severance pay is owed?

For most non-unionized workers, the amount of notice of termination or severance pay owed is based on the Employment Standards Act minimums, plus an additional amount for common law notice (unless limited by a valid contract).  If an employer can prove it is impossible for the employment contract to be performed due to unforeseen circumstances, we may see the Employment Standards Branch, and even possibly our courts, finding no termination or severance pay is owed.  If the “impossibility” standard is not met, then we expect the usual rules for calculating how much the employee gets will apply, which are summarized below.

Section 63 of the Employment Standards Act applies to set the minimums for notice of termination/severance pay, ranging from zero for workers who have been employed less than 3 months, to 8 weeks for those with 8 years or more of employment.  Section 65 of the Employment Standards Act has higher notice requirements for group terminations of 50 workers or more.

Written employment contracts can put a cap on the amount of notice of termination or severance pay, but many contracts are invalid.  Some common reasons for contracts failing are (1) if the contract was not signed before the employee started and nothing new was provided in exchange for signing the contract, (2) if the termination clause is vague or poorly worded, or (3) if the termination clause could fall below the Employment Standards Act minimums at any point.

If there is no valid employment contract, common-law notice/severance pay is applicable.  The amount is determined based on the worker’s age, length of service, nature of their job and availability of alternative employment.  As explained above, the financial circumstances of the business are not generally considered in determining the amount owed.  In the event of an extreme industry downturn, there actually may be more notice or severance pay owed since the availability of alternative employment is considered.

Employees who are laid off have a duty to mitigate.  That means they have to take reasonable steps to look for a new job, and whatever they are owed in common-law severance would be reduced by earnings from new employment during that severance period.  Most of these cases never get to court, but mitigation is a key factor in negotiating packages.

  1. What about working notice?

Employers are allowed to give working notice, which is a notice of termination at a specific future date.  If they give enough advance notice, or the worker quits before their last day, no further severance pay is owed.  This can be a cost-effective way for businesses to roll-out layoffs, as the workers continue to perform work and add value during the working notice period.

  1. Economic circumstances may impact severance pay negotiations

While there is some uncertainty in whether the economic circumstances of the business will be taken into account in determining whether severance is owed, the practical reality is that businesses and workers may be able to agree to a severance package that is fair in the circumstances.  If the business is truly unable to pay the amount of severance that might be owed, workers may decide to accept this and agree to less so that they at least get paid something.

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].

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