TORONTO – The Ontario government is taking action to protect jobs by helping businesses avoid costly payouts and potential closures and continues offering protection to workers that are laid off due to COVID-19. These measures are being adopted through the extension of regulatory amendments that were put in place at the outset of the pandemic and through the introduction of a new regulation.

“Business owners continue to face challenging times during this pandemic, with many struggling to keep their doors open. Having to come up with termination and severance pay at this time could drive many of them under,” said Monte McNaughton, Minister of Labour, Training and Skills Development. “Our government will continue to provide businesses with the support they need until they can reopen and return to full operations. We want to ensure employees have jobs to return to when the economy rebounds from the COVID-19 economic crisis.”

For employers with non-unionized employees, the government is extending regulatory changes brought forward under the Employment Standards Act to July 3, 2021.The regulation’s changes include putting non-unionized employees on job-protected leave during the COVID-19 outbreak any time their hours of work are temporarily reduced by their employer due to the pandemic to prevent temporary layoffs from becoming permanent. Under the Act, temporary layoffs become terminations when they exceed the permitted period. Previously set to expire on January 2, 2021, the extension of this amendment ensures that workers remain employed while providing relief to employers.

To support the hospitality industry and other hard-hit industries, the government is creating a special industry regulation allowing employers to negotiate alternative arrangements with unions for putting termination and severance pay into trust for laid-off employees. Employers with laid-off unionized workers need to put all potential termination and severance payments in a trust after 35 weeks while employees wait to be recalled to their jobs.

Given the unique challenges that many employers in the tourism and hospitality industries are facing as a result of COVID-19, the government is providing employers and unions the option to use those funds to help keep business doors open. The provision is only available if unions and employers both agree to create alternative arrangements. For instance, an employer and union could agree to only 50 per cent of termination and severance pay being put into trust. Employers will not be able to implement these changes unilaterally.

 “Allowing unions and employers in the hospitality, tourism and trade show industries to work together to develop a solution based approach during this crisis is critical to keep them open and allow them to fully recover,” said Lisa MacLeod, Minister of Heritage, Sport, Tourism and Culture Industries. “This initiative supports our government’s commitment laid out in the 2020 Ontario Budget to provide unprecedented support for people and jobs during this challenging time. These actions will help us lay the groundwork for a robust long-term economic recovery for the province.”