Experts warn of employer responsibilities, legal obligations in these situations
Employers had better tread lightly when handling temporary layoffs, according to experts.
Under the rule – embedded in employment law across several provinces – employers can temporarily lay off workers during slowdowns in business operations or off-seasons. However, they must bring workers back, according to a CBC report.
"The idea is that the relationship is going to resume," said Brittany Taylor, an employment lawyer and partner at Rudner Law, in the report.
During that time, the temporarily laidoff workers remain in employers’ payroll records, but services and compensation pause for a period, she added. Meanwhile, the workers are free to work another job, or seek employment insurance.
Temporary layoffs became a common thing among employers during the COVID-19 pandemic.
One thing that employers should get if they are going to temporarily lay off a worker is their consent, said Taylor.
While employees are not required to give their consent, the employer can instead terminate the employee if they don't have enough work or resources to keep them on board, she said, according to CBC.
How do you handle employees after temporary layoffs?
And if an employee agrees to be temporarily laid off, companies should bring them back, said Michelle McKinnon, partner at Cassels Brock & Blackwell LLP in Vancouver, in the report.
"If you don't bring them back and the layoff extends beyond the maximum period, then at that point it becomes a termination of employment," she said. That could trigger the requirement for the employer to pay severance and legal consequences could arise, she said.
And when termination is triggered, it is counted retroactive to the first day of the seasonal layoff. That means the severance compensation will then depend on the age of the employee and how long they've worked for the company, she told the CBC.
Intel, Tesla, Cisco, Indeed and Citigroup, among others, have announced layoffs this year, with many citing poor business performance as the reason.
The new rule requiring federally regulated employers to give longer notice of termination for employers who have spent a long time in their employ took effect Feb. 1.