Employment Law Amendments Increase Employer Flexibility
On July 29, 2020, the Alberta government passed Bill 32: Restoring Balance in Alberta’s Workplaces, making sweeping changes to Alberta’s Employment Standards Code and Labour Relations Code. The changes take effect on various dates, with most changes to the Labour Relations Code effective on July 29, 2020 (with some taking effect upon Proclamation) and most changes to the Employment Standards Code taking effect on November 1, 2020 (with some effective August 15, 2020). Generally speaking, the Bill is aptly named, providing greater employer flexibility and rights, as well as simplifying many regimes within the two statutory regimes. This Employer Alert will overview the key changes with a focus on non-unionized workplaces.
Key Changes for Non-Unionized Employers
Changes Effective August 15, 2020
Layoffs can now last for 90 days (as opposed to 60 days) within a 120-day period. If a layoff is a result of COVID-19, the layoff may be up to 180 consecutive days.
Group Terminations of Employment
Group Terminations are simplified, as terminations of 50 or more employees in a four-week period will follow a single set of rules. Employers must give written notice to the Minister of Labour and Immigration “at least 4 weeks before the date on which the first termination is to take effect,” unless the Employer is unable to do so within that time, in which case they must give written notice as soon as is reasonable and practicable in the circumstances.
Variances and Exemptions
The Director will have increased authority to grant variances and exceptions across a wider range of provisions.
Changes Effective November 1, 2020
Vacation and Holiday Pay in Average Daily Wages
Employees will still receive general holiday (referred to here by the more commonly used term “stat holiday”) pay, but employers will not have to include vacation or stat holiday pay in the calculations of average daily wages. Instead, average daily wages will be the employees’ total earned wages excluding vacation pay and stat holiday pay averaged over the number of days they worked in either of the following periods:
- The four weeks immediately before the stat holiday, or
- Four weeks ending on the last day of the pay period that occurred just before the general holiday.
The employer may choose which calculation period to use. This has the effect of reducing stat holiday pay when an employee was off work on vacation or another stat during the reference period for calculating the stat holiday pay.
Final Pay Following Termination of Employment
Employers will now have more time to provide their final pay to an employee upon termination. Employers will be required to pay employees their final earnings the later of:
- 10 consecutive days after the end of the pay period in which the termination of employment occurs; or
- 31 consecutive days after the last day of employment.
Payroll – Deductions and Overpayments for Employer Flexibility
Employers can correct payroll errors or recover vacation pay paid in advance of an employee being entitled to it by providing written notice to employees that deductions will be made to their paycheques. Employees will not have to provide written consent to authorize the deductions. A deduction for overpayment must be made within six months of the overpayment.
Deductions under this change may only be made for overpayments or vacation pay advances paid to an employee after November 1, 2020. These are welcome new “common sense” exceptions to the general rule requiring written consent before making a deduction from pay.
Hours of Work Averaging Agreements are now replaced with Averaging Arrangements and no longer require an employee’s consent. Both are designed to allow employees to work shifts exceeding 8 hours without paying overtime so long as the average time worked over a defined period of time is 40 hours per week or less. Employers may now require or permit an employee or group of employees to work a schedule including an averaging arrangement on two weeks’ advance written notice, including notice given at the time of hire. An averaging arrangement may now span 52 weeks. Averaging arrangements no longer require an end date. An averaging arrangement may also permit an employer to amend the schedule of daily and weekly hours of work provided that it specifies the manner and notice required to do so.
Employers will have much more flexibility when using Averaging Arrangements. Not only can the averaging take place over longer periods, but they can also have more flexibility to actually change the shift schedule during the 52-week period. Most importantly, employers can unilaterally impose such schedules without getting employee consent, which was a common stumbling block under the previous regime.
Averaging Agreements made prior to November 1, 2020 will continue to be valid until they either expire or is cancelled. Either party to an Averaging Agreement may cancel it with 30 days’ notice to the other party. The new Averaging Arrangement provisions also eliminate the employee’s right to terminate averaging.
The list of jobs for 13 and 14-year-olds in the Regulation eligible for lower minimum wage (i.e. $13 per hour) will expand to include positions usually approved by Director permit. This includes positions in the restaurant and food services industry, on the condition that they are working with someone at least 18 years old. Light janitorial work in offices, coaching and tutoring are also added.
Whilst employees working shifts under 10 hours continue to be entitled to one 30-minute break, employers will only be required to provide an employee working a shift of 10 hours or more with at least two rest periods of at least 30 minutes each.
Rest periods may be taken at a time agreed upon by the employer and the employee. If there is no agreement, then the employer may determine when the rest period is to be taken. If an employee is entitled to two rest periods and there is no agreement as to when it must be taken, the second rest period may only be taken after the first five consecutive hours.
As before, the employer and employee may agree to split a 30-minute rest period into two 15-minute periods.
Vacations Entitlement during a Leave of Absence
An employee’s statutory leaves of absence will now be included when calculating their years of employment for vacation entitlement.
Written Statement of Earnings
Employers may use electronic pay statements so long as the employee has confidential access and can print a paper copy.
Takeaways for Non-Unionized Employers
Employers should review the new changes and ensure that they integrate them into their internal systems and policies. In particular, employers should be aware of or do the following when the changes take effect:
- Ensure the length of temporary layoffs respect the new rules on duration.
- Adjust calculations of stat holiday pay to exclude vacation and holiday pay in averaging earnings starting November 1, 2020.
- If employees are currently under an Averaging Agreement, plan ahead to provide the necessary notice to cancel existing ones and change them over to an Averaging Arrangement.
- Where electronic pay statements are preferred, ensure that payroll systems are prepared to begin distributing electronic statements.
Key Changes for Unionized Employers
Altering Employment Standards Requirements
Through collective agreements, employers and unions will be allowed to alter some of the basic Employment Standards Code standards. Specifically, they can alter the rules pertaining to hours of work, notice of work times, days of rest, and overtime hours under hours-of-work averaging arrangements.
First Contract Arbitration
The Board will only order first contract arbitration if a certain threshold test is met. First contract arbitration remains a last option.
The Board may order now only remedial certification of a trade union as a bargaining agent if no other remedy or remedies are sufficient to counteract the impacts of the employer’s misconduct and the true wishes of employees cannot be determined.
The Reverse Onus Rule
Where a complaint against the employer alleges that an employee has been terminated for unionizing activity, the burden of proof remains on the employer to prove the termination was not in breach of the LRC.
Where a complaint against the union (or person acting on behalf of the union) alleges that the trade union coerced, intimidated, or violated opt-in provisions in relation to an employee, the same reverse burden of proof now lies on the trade union.
Consequences of Prohibited Practices by a Union;
If an application for certification is refused by the Board, withdrawn by the applicant, or is not actively pursued by the applicant and an unfair labour practise complaint is proven against the union, the union may not re-apply for certification for six months.
Union Disciplinary Powers
Unions must not expel, suspend or take disciplinary action against or impose a penalty on a member who refuses to pay dues, assessment or fees related to prescribed activities, including social causes or issues, charities or non-governmental organizations, and groups affiliated or supportive of a political party.
The Powers of an Arbitrator
Arbitrators will no longer have the power to provide relief from time limits under the Labour Relations Code. Arbitrators will no longer be directed to make decisions in accordance with the principles of Canadian labour arbitration.
The Powers of the Alberta Labour Relations Board
The Board may dismiss an application summarily for improper motive or an abuse of process. The Board may dismiss a denial of fair representation complaint if the complainant has refused to accept a settlement that is fair and reasonable.
The Board must complete a certification application within six months, but the Chair may extend that time limit in exceptional circumstances.
Renewing a Collective Agreement
If the Labour Relations Board recognizes that employees have provided consent, an employer can work with a union to renew a collective agreement before its expiration date.
New Rules for Union Dues and Secondary Picketing During Strikes, Lockouts, and Picketing
During an illegal strike, union dues will be suspended, and in the event of an illegal lockout, employers will be required to pay employees’ union dues. There are additional criteria for determining whether picketing is lawful. Unions will also have to obtain the permission of the Labour Relations Board before picketing at a secondary business.
Changes to Complaint Process
An employer will have the reverse onus to disprove employee complaints only when the complaint is about unfair termination or discipline. A union will have the same reverse onus to prove that it is not culpable when defending against allegations of coercion or intimidation.
Financial Transparency and Dues for a Political Purpose
Unions must provide financial statements to their members, as soon as possible after the end of every fiscal year, making it easier for members to see how their unions are spending money. Members may opt-in or opt-out of a portion of dues that are for certain prescribed purposes.
Alberta Labour Relations Board Standard of Review of Arbitration Awards
The legislated standard of review (i.e. fairness and reasonableness) for arbitration awards are repealed, allowing the Board and courts to determine the standard of review that should be used in reviewing arbitrator decisions.
N.B. The above is only a brief summary of the major amendments to employer flexibility and does not cover all changes. Employers should get legal advice on the details of all changes before making changes to their business.