An in-depth look at the Emplyoment Standards Amendment Act
Changes to Ontario’s hours-of-work aren’t coming into force on the first of the new year as had been planned. Instead, they will now come into force on Mar. 1, 2005.
Bill 63, known as Employment Standards Amendment Act (Hours of Work and Other Matters), 2004, was passed by the Ontario legislature and received royal assent on Dec. 9, 2004.
It sets out a new set of rules that employers must follow if they want their employees to work excess daily or weekly hours, or if they want to average an employee’s working hours to determine overtime pay entitlements.
These rules will amend and replace the current provisions of the Employment Standards Act, 2000 (“the ESA 2000”) dealing with hours of work and overtime. The new rules are summarized below:
Maximum daily and weekly hours
Bill 63 prohibits employers from requiring or permitting employees to work more than 48 hours per week, unless:
-the employees have agreed to do so in writing;
-the employer has given the employees an information sheet published by the Ministry of Labour setting out their rights and the employer’s obligations respecting hours of work and overtime pay; and
-the employer has applied for, and received, consent for excess working hours by the director of employment standards.
The first two criteria also apply to agreements to work excess daily hours (that is, more than eight hours per day).
Overtime averaging agreements
Effective Mar. 1, 2005, employers will also be required to apply for approval to engage in overtime averaging agreements for the purposes of determining an entitlement to overtime pay.
Seeking approval for excess working hours
An employer seeking applying for approval for excess working hours must complete the following five steps:
1. The employer must first provide its non-union employees with the Ministry’s publication, “Information for Employees About Hours of Work and Overtime Pay”.
2. Next, the employer must enter into written agreements with each employee (or with any union representing the employees, as applicable) to obtain their consent to work the excess hours requested, or to average their working hours over two or more weeks.
3. The employer must obtain and fill out the “Hours of Work and Averaging Hours” application, which is available on the Ministry website.
4. The application must be served on the director of employment standards. Service may be done by e-mail, verifiable mail (for example, registered mail, Xpresspost or Priority Courier), facsimile, or hand-delivery. The appropriate addresses and contact numbers are listed on the application form.
5. At least one copy of the application must be posted, on the date of service, in every workplace where the affected employees work. The application must remain posted until the employer receives approval from the director.
Rights and obligations pending approval
Pending approval from the director of employment standards, and upon satisfaction of the conditions listed below, an employer can permit its employees to work up to 60 hours per week. The nine conditions are:
1. The employer and employee have entered into valid, written agreements respecting excess hours or averaging of weekly hours;
2. The employer has served the “Hours of Work and Averaging Hours” application on the director of employment standards, in a form permitted;
3. The application specifies the individual employees or occupational groups being requested to work extra hours or to average their working hours;
4. Thirty days have passed since the application was served on the director;
5. The employer has not received a notice that the application was refused;
6. The employer’s most recent application, if there had been any, was not refused;
7. The employer’s most recent application, if there had been any, was not revoked;
8. The employer has posted a copy of the application in accordance with the legislation; and
9. The employee(s) do not work more than the lesser of the following: the hours of work specified in the application; the number of hours the employee agreed to work in writing; or 60 hours.
The same basic criteria are applicable in the case of averaging applications except that there is no requirement to post a copy of the application, and employers are only entitled to average over a two-week period pending the director’s approval.
Transitional rules
Until Mar. 01, 2005, the current provisions of the ESA 2000 continue to apply. An employer can continue to have its employees work up to 60 hours in a week, or to average employees’ weekly hours over two or more weeks, in accordance with prior written agreements.
However, employers should apply for new approvals for these practices as soon as possible. For employers who do submit an application well in advance of Mar. 01, 2005, the 30-day period referred to above shall not be deemed to have passed until Mar. 01, 2005.
Existing agreements to work excess hours, or to average overtime hours, will be honoured and will continue in accordance with their terms, after Mar. 01, 2005, with the following exceptions:
-the employer must have applied to the director for approval before Feb. 28, 2005 in order to continue its existing arrangement on or after Mar. 01, 2005;
-the employer cannot permit employees to work in excess of 60 hours per week, until approval for that arrangement has been received; and
-the employer must provide its employees with a copy of the Ministry of Labour’s information sheet by no later than June 1, 2005. This requirement does not apply to unionized employees.
Susan Sorensen is an associate with Toronto-based law firm Borden Ladner Gervais LLP. She can be reached at (416) 367-6017.
Bill 63, known as Employment Standards Amendment Act (Hours of Work and Other Matters), 2004, was passed by the Ontario legislature and received royal assent on Dec. 9, 2004.
It sets out a new set of rules that employers must follow if they want their employees to work excess daily or weekly hours, or if they want to average an employee’s working hours to determine overtime pay entitlements.
These rules will amend and replace the current provisions of the Employment Standards Act, 2000 (“the ESA 2000”) dealing with hours of work and overtime. The new rules are summarized below:
Maximum daily and weekly hours
Bill 63 prohibits employers from requiring or permitting employees to work more than 48 hours per week, unless:
-the employees have agreed to do so in writing;
-the employer has given the employees an information sheet published by the Ministry of Labour setting out their rights and the employer’s obligations respecting hours of work and overtime pay; and
-the employer has applied for, and received, consent for excess working hours by the director of employment standards.
The first two criteria also apply to agreements to work excess daily hours (that is, more than eight hours per day).
Overtime averaging agreements
Effective Mar. 1, 2005, employers will also be required to apply for approval to engage in overtime averaging agreements for the purposes of determining an entitlement to overtime pay.
Seeking approval for excess working hours
An employer seeking applying for approval for excess working hours must complete the following five steps:
1. The employer must first provide its non-union employees with the Ministry’s publication, “Information for Employees About Hours of Work and Overtime Pay”.
2. Next, the employer must enter into written agreements with each employee (or with any union representing the employees, as applicable) to obtain their consent to work the excess hours requested, or to average their working hours over two or more weeks.
3. The employer must obtain and fill out the “Hours of Work and Averaging Hours” application, which is available on the Ministry website.
4. The application must be served on the director of employment standards. Service may be done by e-mail, verifiable mail (for example, registered mail, Xpresspost or Priority Courier), facsimile, or hand-delivery. The appropriate addresses and contact numbers are listed on the application form.
5. At least one copy of the application must be posted, on the date of service, in every workplace where the affected employees work. The application must remain posted until the employer receives approval from the director.
Rights and obligations pending approval
Pending approval from the director of employment standards, and upon satisfaction of the conditions listed below, an employer can permit its employees to work up to 60 hours per week. The nine conditions are:
1. The employer and employee have entered into valid, written agreements respecting excess hours or averaging of weekly hours;
2. The employer has served the “Hours of Work and Averaging Hours” application on the director of employment standards, in a form permitted;
3. The application specifies the individual employees or occupational groups being requested to work extra hours or to average their working hours;
4. Thirty days have passed since the application was served on the director;
5. The employer has not received a notice that the application was refused;
6. The employer’s most recent application, if there had been any, was not refused;
7. The employer’s most recent application, if there had been any, was not revoked;
8. The employer has posted a copy of the application in accordance with the legislation; and
9. The employee(s) do not work more than the lesser of the following: the hours of work specified in the application; the number of hours the employee agreed to work in writing; or 60 hours.
The same basic criteria are applicable in the case of averaging applications except that there is no requirement to post a copy of the application, and employers are only entitled to average over a two-week period pending the director’s approval.
Transitional rules
Until Mar. 01, 2005, the current provisions of the ESA 2000 continue to apply. An employer can continue to have its employees work up to 60 hours in a week, or to average employees’ weekly hours over two or more weeks, in accordance with prior written agreements.
However, employers should apply for new approvals for these practices as soon as possible. For employers who do submit an application well in advance of Mar. 01, 2005, the 30-day period referred to above shall not be deemed to have passed until Mar. 01, 2005.
Existing agreements to work excess hours, or to average overtime hours, will be honoured and will continue in accordance with their terms, after Mar. 01, 2005, with the following exceptions:
-the employer must have applied to the director for approval before Feb. 28, 2005 in order to continue its existing arrangement on or after Mar. 01, 2005;
-the employer cannot permit employees to work in excess of 60 hours per week, until approval for that arrangement has been received; and
-the employer must provide its employees with a copy of the Ministry of Labour’s information sheet by no later than June 1, 2005. This requirement does not apply to unionized employees.
Susan Sorensen is an associate with Toronto-based law firm Borden Ladner Gervais LLP. She can be reached at (416) 367-6017.
