After considerable anticipation, the federal government has finally announced that several changes to the Canada Labour Code will come into effect Sept. 1, 2019.
The alterations — made through the Budget Implementation Act, 2017, No. 2 and the Budget Implementation Act, 2018, No. 2 — will impact federally regulated employers.
The amendments “aim to support employees in achieving better work-life balance and benefit employers through increased productivity, decreased absenteeism, enhanced recruitment and retention and more flexible and effective workforce utilization,” said the government.
In addition to the changes highlighted in the January 2019 story “Bill C-86 brings major changes” in Canadian HR Reporter — including new leaves, pay equity requirements and alterations to vacation pay — the amendments coming into force this fall involve provisions around scheduling, overtime and flexible work arrangements.
But while the changes are similar to those brought in by the Ontario government, the federal sector looks a lot different than the provinces, says Christopher Pigott, a partner at Fasken in Toronto.
“These are 24-7, continuous-operation types of industries that do not exist to the same extent in the provinces. They’re also, as compared to the provinces, heavily unionized companies. And so, you’ve got companies — airlines, telecommunications, rail companies — that have longstanding and very mature and sophisticated collective agreements and relationships with their unions. So, I think that we are in for potentially a significant amount of disruption in the federal sector.”
The alterations were developed and brought into force quite quickly, without a lot of consultation or thought put into how they will play out on the ground, he says.
“Most federal employers were not averse to changes and modernization of labour standards at all. What many federal employers are upset about is the fact that there wasn’t consultation — or at least extensive consultation. And there seems to have not been any thought put into these sorts of specific examples, specific disruptions… and whether or not carefully tailored exceptions can be created to ensure that these challenges don’t play out in a negative way.”
A high percentage of the federal sector is unionized, and the code is the floor of rights that people have, says Jodi Gallagher, a partner at Hicks Morley in London, Ont.
“There’s going to be a lot of collective agreements that don’t have a lot of these items. And so, it is bringing up the floor of rights that people have,” she says. “I have a number of clients that are in bargaining right now… And these clients have had to make cost estimates and be aware of what the changes are.”
One of the major changes involves scheduling, as employers must now give 96 hours’ written notice of an employee’s work schedule and 24 hours’ written notice of a shift change.
It’s a dramatic move, says Ilan Burkes, partner at Harris & Company in Vancouver.
“Economies are changing, and you look at a lot of collective agreements, they’re kind of shifting away from that. Employers are trying to be as nimble and flexible as possible, and now the code will go the opposite direction and require that employees be given [notice] 96 hours in advance before scheduling changes,” he says.
“A lot of collective agreements have this type of language, but what you’d find in those collective agreements is a provision where, if the employer fails to adhere to that, then they have to pay overtime. Here, the employee could just refuse to work that shift.”
The 24-hour provision will not apply in situations that the employer could not reasonably have foreseen, for example, those that present or could reasonably be expected to present an imminent or serious threat to the life, health or safety of any person, among other things, says Gallagher.
Employers will have to change their mindset to comply with these provisions, she says, “because the exceptions are relatively narrow. And so, it requires a different thought process and planning.”
It’s not clear how these exceptions will be interpreted, but there “appears to be a relatively high onus on the employer to justify a change,” says Burkes.
“Operationally, especially on the scheduling side, I think that a lot of [employers] are going to have to think very carefully about how they schedule now, which is something they probably didn’t have to do as much before.”
Another major change gives employees the right to refuse overtime for family responsibilities. The code is “relatively descriptive” on what that means — but this issue has already been addressed in a lot of collective agreements and “quite carefully circumscribed,” says Pigott.
“[The code] doesn’t create certainty as to how these situations will unfold on the ground in a couple of months. And, in some cases, the specificity that’s included in the legislation is at odds with the collective agreement provisions or the practices on the ground in specific industries and specific company. So… how do those inconsistencies, how do those conflicts work themselves out? We just don’t know.”
In general terms, the Canada Labour Code will trump a collective agreement, unless the code specifically says the agreement can be different, he says.
“But the decision needs to be made by an arbitrator... so you need to have litigation and an arbitrator finding that, yes, the collective agreement provides different entitlements than the code. But, overall, those collective agreement entitlements are more generous than what the code reports and, therefore, they’re allowed to continue in force. And so, in either scenario, we’ve got a lot of uncertainty.”
While most people would agree with the right to refuse overtime, says Burkes, the question should be: Who’s going to adjudicate that?
“If the employer says, ‘No, you’re coming to work,’ I guess it’s a complaint that’s filed. And the collective agreements have provisions that are set up to address these types of disputes. The Canada Labour Code doesn’t really have that type of system in place to adjudicate this. And that’s the concern I have. I’m not sure what will happen if the employer and the employee are at odds as to whether there is a true family responsibility issue that arises within the meaning of the code.”
In the collective agreement context, the employer can mandate that an employee work a shift, and the worker can then grieve this, he says.
“What happens here? I’m not entirely sure.”
The code also allows for overtime to be compensated via paid time off.
“It goes to the current practices,” says Pigott. “There’s always been a requirement to pay overtime… but for these 24-7, continuous operations, the expectation was not that you would necessarily be giving employees significant paid time off for working overtime. So, it really could impact how employers structure shifts and schedules and their expectations around when employees will be available for work.”
The change captures current practices in many workplaces, says Gallagher.
“The code was silent about essentially banking overtime. And this issue came up in some of the litigation we’ve seen around compensation for overtime. So, this provision is really codifying what many employers do already. It’s not a surprising or new concept that you can bank overtime. And that you’d have to agree [to] in writing... and here there are parameters around how quickly it has to be used or paid out,” she says.
“It resolves the question mark that was there, because of the silence of the code…. So, I wouldn’t say it’s a significant change; it’s just clarifying how it needs to work.”
Changing work conditions
As part of the changes, employees with at least six months of continuous service will be able to formally request a change in working conditions, such as work schedule or location. Employers must then respond in writing, either granting or denying the request or setting out an alternative change, says Gallagher.
“Employers are going to see a lot of requests for people to work from home or changes to their work schedules,” she says. “This is a broader provision than a change to a work schedule because of, for example, child care. So, the duty to accommodate from a family status perspective, I think, is a different situation. Here, it doesn’t have to be related to a family status or a child-care or elder-care situation.”
And that would be dealt with differently because it’s not a human rights consideration, she says.
“It doesn’t give a right to the change,” says Gallagher. “There might be a perception… that it’s actually a right to change your work schedule, work location or other conditions of your employment, when really it’s a right to ask for that and a write to get an answer in writing, so you can’t be ignored.”
Currently, an employee has an entitlement under the Canadian Human Rights Act to request a change if they, for example, have a disability, family responsibility or religious characteristic that entitles them to accommodation circumstances, says Pigott.
“Someone can make a request for a change in their work arrangement, their schedule, their work location, and the employer is required to consider it,” he says. “And while the employer doesn’t have to grant the request, it must provide good faith reasons as to why the change is not possible.”
One consideration for employers in looking at these changes is the looming federal election. As seen in provinces such as Alberta and Ontario, Conservative governments have repealed previous changes made by the Liberals, says Pigott.
“The question now becomes — at the federal level — will we see the provincial story play itself out? If a Conservative government is elected this fall, will we see the Conservatives… take another look at the changes that are coming into force on Sept. 1 and take action?
“These abrupt shifts back and forth, I don’t think anyone in the employer community welcomes that, because the employers are the ones that need to adjust their operations on the ground,” he says. “And the shifting sands of labour standards changes… you want stability, that’s the important thing.”
It’s frustrating for employers because there’s so much change at hand, much of which has been put through in a very confusing way, says Gallagher.
“And then there’s a question mark, because of the election — how much of this is actually going to remain in place afterwards?”
The risk is that employers may bargain some of these components into a collective agreement without caveats, and then a rollback happens, she says.
“They need to be careful about how they deal with these issues. You can say, ‘To the extent it’s provided under employment standards legislation,’ ‘to the extent it’s provided under the Canada Labour Code,’ or you can essentially remain silent. And then the code minimum is going to apply... And then if the code minimum goes away, it no longer applies.”