Employers can take a number of steps to lessen the impact for a pregnant worker who loses her job
Terminating a pregnant employee is never an easy task. But there are steps an employer can take, in how it handles severance pay and determining the termination date, that can go a long way in making things easier for the employee and the organization.
The federal Employment Insurance Act affords benefits for both pregnancy and parental leave. But the woman must meet certain conditions to be eligible for these benefits. It is often difficult for her to do so if the employer terminates her employment at the wrong time.
Part of the act provides for the payment of benefits to women who prove their pregnancies in accordance with the regulations. To qualify for benefits, a claimant must have been employed in insurable employment for 600 or more hours in her qualifying period and must suffer an interruption of earnings. Such an interruption occurs at the beginning of a week in which there is a reduction of more than 40 per cent in her regular weekly earnings because she ceases to work due to pregnancy. Therefore, if a pregnant employee is fired within months of the date of her intended leave, she may not qualify for benefits because she will not have enough insurable hours.
Another problem comes when severance pay is handed out. If a woman’s employment is terminated and a severance package given while she is on leave, the legislation stipulates any money received while in receipt of parental benefits will be deducted from those benefits. The case of Krock v. Canada (Attorney General) illustrates this issue.
Krock was an appeal to the Federal Court of Appeal from an umpire’s decision that Krock was ineligible for pregnancy benefits during a period when she received severance pay. Krock had lost her job in a restructuring and her employer paid a lump-sum severance payment equivalent to about one-year’s salary. Krock then applied for pregnancy benefits. The benefits were denied upon the basis she was receiving employment income during pregnancy leave.
The Federal Court of Appeal found the receipt of wages operated as a general bar to, or reduction of, all Employment Insurance benefits. Therefore, if an employee who is on pregnancy leave has her employment terminated, and receives severance during that leave, she will lose out on some or all of her benefits because the severance will be deducted from the benefits.
Despite the fact employers may argue a severance allows the employee to receive money, this may not help her when it comes time to return to work and she finds herself without a job. Most women on pregnancy leave do not have the time or energy to look for another position. Further, the stress of the termination while on leave and the requirement to find another position reduces the enjoyment of experiencing the birth of the child.
On the flip side, there are some employees who use the fact they are pregnant to their advantage. These employees will argue discrimination and reinstatement on the basis of pregnancy. Fortunately, for employers, the law affords some protection.
If the employee can prove sex is a consideration in a decision to dismiss a person, or where it influences the treatment by the employer, discrimination or harassment will likely be found. If the employer can prove sex is not a consideration, the employer may be successful. Likewise, in employment standards decisions regarding re-instatements, if the employer can show it is not based on pregnancy but rather on the business being shut down or discontinued, the employer will probably be successful.
There are a number of ways in which management and payroll can assist pregnant employees while helping to minimize liability for the employer:
•Develop a corporate policy for hiring new employees. A policy should be developed which can be circulated amongst management responsible for the hiring and firing of employees. The policy should include questions which should and should not be asked during the interview process. For example, it is illegal for employers to ask if a candidate is pregnant, has a family or plans to have one in the future.
•Educate employees. From the hiring process to return-to-work after pregnancy and parental leave, employers need to educate staff about what is right and wrong. Ensure management is aware of the various legislative protections available to pregnant employees. If the issue involves the pregnant employee returning to the workplace after leave, ensure she returns to the position most recently held. Do not demote the employee or place her in a less comparable position. Remember, if her work is carved up, and all parts of the job when pieced together would still add up to the old position, the employer will be found to be in breach of its duty.
•Distribute severance packages at the end of pregnancy and parental leave. Due to the problems faced by women regarding insurable hours and deductions made under the federal Employment Insurance Act, if the employer chooses to terminate a woman’s employment while she is on pregnancy or parental leave, it would be very helpful to have the severance package paid to the employee at the end of the leave rather than during the leave. This should not cause any problems for the employer and will greatly assist the woman in keeping her benefits.
Legal protection for pregnant workers
While there are many legal protections for pregnant employees, they remain one of the more vulnerable groups in the workforce. Legal protections are outlined in provincial and federal statutes and under common law. In Ontario, the Human Rights Code prohibits discrimination and harassment on the basis of sex. During the initial interview process, it is illegal for a potential employer to ask if a woman is pregnant, has a family or plans to have a family. Employers are also prohibited from firing a woman because she is pregnant or plans to become pregnant.
The code provides protection for employees who have been denied promotions or opportunities on the basis of pregnancy as well as protection for employees who may be harassed or subjected to comments regarding their pregnancies.
If the Ontario Human Rights Commission finds a pregnant employee has been discriminated against or harassed on the basis of her pregnancy, the employer will be found to be in breach of the code.
Despite these protections, discrimination and harassment for pregnant employees continues to exist. Even though many employers may not admit it, pregnancy often enters into the hiring and firing equation. Pregnant employees may also be subject to harassing behaviour from colleagues or supervisors.
Ontario’s Employment Standards Act, 2000, provides a variety of protections including the right to be reinstated to the position held prior to the pregnancy leave. In particular the act stipulates an employee returning from pregnancy leave must be returned to the position she most recently held if it still exists or to a comparable position.
Some employers try to avoid this obligation by arguing the job no longer exists because of a restructuring. But a recent decision in an employment standards complaint makes it clear the employer has a mandatory obligation to reinstate the employee.
In Chateau v. Canadian Special Olympics Inc., Chateau was employed as the national program director from 1995 to 2002. Her employment was terminated after she returned from parental leave. At a meeting she was told her position had been eliminated and she was offered a package. In reality, no part of the operation had ceased. The work had only been redistributed.
The employer argued the termination of Chateau’s employment was due to strategic reorganization. But the employment standards officer disagreed. Given that the duties previously performed by Chateau were now being performed by other colleagues, the officer held Chateau’s job still existed and the employer had breached its duty. In the decision, the officer made it clear there is an obligation on the part of the employer to reinstate the employee to a comparable position. Only if an employee’s position is no longer there, as in the case where the business shuts down or the business is discontinued, can the employer escape that obligation. The fact that another person is performing the employee’s work is not a valid reason under the legislation for denying reinstatement. Merely carving up the employee’s position and redistributing duties does not mean the job no longer exists.
Natalie MacDonald is an associate with Grosman, Grosman & Gale, a Toronto-based law firm specializing in employment law. She can be reached at (416) 364-9599 or [email protected]. Look for her next column in the Nov. 3, 2003 Guide to HR Technology.
The federal Employment Insurance Act affords benefits for both pregnancy and parental leave. But the woman must meet certain conditions to be eligible for these benefits. It is often difficult for her to do so if the employer terminates her employment at the wrong time.
Part of the act provides for the payment of benefits to women who prove their pregnancies in accordance with the regulations. To qualify for benefits, a claimant must have been employed in insurable employment for 600 or more hours in her qualifying period and must suffer an interruption of earnings. Such an interruption occurs at the beginning of a week in which there is a reduction of more than 40 per cent in her regular weekly earnings because she ceases to work due to pregnancy. Therefore, if a pregnant employee is fired within months of the date of her intended leave, she may not qualify for benefits because she will not have enough insurable hours.
Another problem comes when severance pay is handed out. If a woman’s employment is terminated and a severance package given while she is on leave, the legislation stipulates any money received while in receipt of parental benefits will be deducted from those benefits. The case of Krock v. Canada (Attorney General) illustrates this issue.
Krock was an appeal to the Federal Court of Appeal from an umpire’s decision that Krock was ineligible for pregnancy benefits during a period when she received severance pay. Krock had lost her job in a restructuring and her employer paid a lump-sum severance payment equivalent to about one-year’s salary. Krock then applied for pregnancy benefits. The benefits were denied upon the basis she was receiving employment income during pregnancy leave.
The Federal Court of Appeal found the receipt of wages operated as a general bar to, or reduction of, all Employment Insurance benefits. Therefore, if an employee who is on pregnancy leave has her employment terminated, and receives severance during that leave, she will lose out on some or all of her benefits because the severance will be deducted from the benefits.
Despite the fact employers may argue a severance allows the employee to receive money, this may not help her when it comes time to return to work and she finds herself without a job. Most women on pregnancy leave do not have the time or energy to look for another position. Further, the stress of the termination while on leave and the requirement to find another position reduces the enjoyment of experiencing the birth of the child.
On the flip side, there are some employees who use the fact they are pregnant to their advantage. These employees will argue discrimination and reinstatement on the basis of pregnancy. Fortunately, for employers, the law affords some protection.
If the employee can prove sex is a consideration in a decision to dismiss a person, or where it influences the treatment by the employer, discrimination or harassment will likely be found. If the employer can prove sex is not a consideration, the employer may be successful. Likewise, in employment standards decisions regarding re-instatements, if the employer can show it is not based on pregnancy but rather on the business being shut down or discontinued, the employer will probably be successful.
There are a number of ways in which management and payroll can assist pregnant employees while helping to minimize liability for the employer:
•Develop a corporate policy for hiring new employees. A policy should be developed which can be circulated amongst management responsible for the hiring and firing of employees. The policy should include questions which should and should not be asked during the interview process. For example, it is illegal for employers to ask if a candidate is pregnant, has a family or plans to have one in the future.
•Educate employees. From the hiring process to return-to-work after pregnancy and parental leave, employers need to educate staff about what is right and wrong. Ensure management is aware of the various legislative protections available to pregnant employees. If the issue involves the pregnant employee returning to the workplace after leave, ensure she returns to the position most recently held. Do not demote the employee or place her in a less comparable position. Remember, if her work is carved up, and all parts of the job when pieced together would still add up to the old position, the employer will be found to be in breach of its duty.
•Distribute severance packages at the end of pregnancy and parental leave. Due to the problems faced by women regarding insurable hours and deductions made under the federal Employment Insurance Act, if the employer chooses to terminate a woman’s employment while she is on pregnancy or parental leave, it would be very helpful to have the severance package paid to the employee at the end of the leave rather than during the leave. This should not cause any problems for the employer and will greatly assist the woman in keeping her benefits.
Legal protection for pregnant workers
While there are many legal protections for pregnant employees, they remain one of the more vulnerable groups in the workforce. Legal protections are outlined in provincial and federal statutes and under common law. In Ontario, the Human Rights Code prohibits discrimination and harassment on the basis of sex. During the initial interview process, it is illegal for a potential employer to ask if a woman is pregnant, has a family or plans to have a family. Employers are also prohibited from firing a woman because she is pregnant or plans to become pregnant.
The code provides protection for employees who have been denied promotions or opportunities on the basis of pregnancy as well as protection for employees who may be harassed or subjected to comments regarding their pregnancies.
If the Ontario Human Rights Commission finds a pregnant employee has been discriminated against or harassed on the basis of her pregnancy, the employer will be found to be in breach of the code.
Despite these protections, discrimination and harassment for pregnant employees continues to exist. Even though many employers may not admit it, pregnancy often enters into the hiring and firing equation. Pregnant employees may also be subject to harassing behaviour from colleagues or supervisors.
Ontario’s Employment Standards Act, 2000, provides a variety of protections including the right to be reinstated to the position held prior to the pregnancy leave. In particular the act stipulates an employee returning from pregnancy leave must be returned to the position she most recently held if it still exists or to a comparable position.
Some employers try to avoid this obligation by arguing the job no longer exists because of a restructuring. But a recent decision in an employment standards complaint makes it clear the employer has a mandatory obligation to reinstate the employee.
In Chateau v. Canadian Special Olympics Inc., Chateau was employed as the national program director from 1995 to 2002. Her employment was terminated after she returned from parental leave. At a meeting she was told her position had been eliminated and she was offered a package. In reality, no part of the operation had ceased. The work had only been redistributed.
The employer argued the termination of Chateau’s employment was due to strategic reorganization. But the employment standards officer disagreed. Given that the duties previously performed by Chateau were now being performed by other colleagues, the officer held Chateau’s job still existed and the employer had breached its duty. In the decision, the officer made it clear there is an obligation on the part of the employer to reinstate the employee to a comparable position. Only if an employee’s position is no longer there, as in the case where the business shuts down or the business is discontinued, can the employer escape that obligation. The fact that another person is performing the employee’s work is not a valid reason under the legislation for denying reinstatement. Merely carving up the employee’s position and redistributing duties does not mean the job no longer exists.
Natalie MacDonald is an associate with Grosman, Grosman & Gale, a Toronto-based law firm specializing in employment law. She can be reached at (416) 364-9599 or [email protected]. Look for her next column in the Nov. 3, 2003 Guide to HR Technology.
