NOTICE EMPLOYERS: FREE ½ hour consultation to review your employment contracts until May 8th 2024. Read More
The law as it relates to employment contracts has evolved substantially over the course of the past few years. A termination clause in an employment contract that was enforceable two years ago is likely not enforceable today. What that means is if you want to terminate an employee the termination pay and severance pay will not be limited to the Employment Standards Act but rather the common law. To give you an example of the difference between the ESA and the common law is as follows:
Let’s use the example that you want to terminate an employee without just cause a middle manager of 55 years old who has worked for your organization for 15 years the cost to you to terminate this employee under the ESA with an enforceable termination clause in your employment contract would be 8 weeks plus benefits. If the termination clause in the employment contract is not enforceable the cost to terminate this same employee, you will likely be somewhere between 12 and 15 months’ pay in lieu of notice. That is a substantial cost between an enforceable employment contract and one that is not enforceable.
Bill 148: “Fair Workplaces, Better Jobs Act”
Question: What is Equal Pay for Equal Work?
1. Bill 148 – “A Plan for Fair Workplaces and Better Jobs”
Bill 148 has made a number of changes to both the Employment Standards Act, 2000 and the Labour Relations Act, 1995. The Bill was passed on November 22, 2017.
One of the significant changes is referred to as “equal pay for equal work.”
2. Equal Pay for Equal Work:
Under the Employment Standards Act, when two employees perform substantially the same kind of work (similar work conditions, skills, and responsibility), an employer CANNOT pay one them less than the other on the grounds of:
i) Sex; and/or
ii) Employment.
3. Difference in Rate of Pay:
A difference in rate of pay is a difference in:
1. Hourly rate;
2. Salary;
3. Overtime rate; and/or
4. Commission rate.
4. Similar Work Conditions:
Similar work conditions include a similar:
i) Work environment (office or outdoors);
ii) Exposure to Weather (rain/snow; or
iii) Health and Safety Hazards (chemicals/heights).
5. Similar Skills:
Similar skills refer to the knowledge, physical skills, and motor skills needed to perform a job. Examples include:
i) Education;
ii) Training;
iii) Experience; and/or
iv) Manual dexterity.
6. Similar Responsibilities:
Similar responsibilities refer to the employee’s accountability and authority needed to perform his or her job. Examples include:
i) The number of decisions that he/she needs to make;
ii) Being accountable for the safety of other staff members;
iii) Acting in a supervisory capacity; and
iv) Being responsible for money;
7. Example:
Sam and Joe work as full-time Construction Laborers for Construction Co. in Timmins, Ontario. Joe started working for Construction Co. in 2007, and Sam started working for Construction Co. in 2016.
Both Sam and Joe have a Building Construction Technician Diploma from Canadore College. They are both responsible for blueprint reading, estimating residential structures, and wood framing.
While Sam and Joe perform the same work, work in the same establishment, use the same skills to perform their job, and have substantially the same responsibilities, Joe makes two times per hour what Sam makes.
Does this constitute a violation of equal pay for equal work under the Employment Standards Act?
8. Answer
In this case, the difference in rate of pay for substantially the same job is due to the seniority system. Joe has worked for Construction Co. since 2007, whereas Sam only started working for Construction Co. in 2016. As such, there is no violation of equal pay for equal work under the Employment Standards Act.
9. Suzanne Desrosiers Professional Corporation:
For assistance in updating your employment policies and procedures and/or providing training to staff members, please contact Suzanne Desrosiers today, at suzanne@sdlawtimmins.com or 705-268-6492.
2. Equal Pay for Equal Work:
Under the Employment Standards Act, when two employees perform substantially the same kind of work (similar work conditions, skills, and responsibility), an employer CANNOT pay one them less than the other on the grounds of:
i) Sex; and/or
ii) Employment.
3. Difference in Rate of Pay:
A difference in rate of pay is a difference in:
1. Hourly rate;
2. Salary;
3. Overtime rate; and/or
4. Commission rate.
4. Similar Work Conditions:
Similar work conditions include a similar:
i) Work environment (office or outdoors);
ii) Exposure to Weather (rain/snow; or
iii) Health and Safety Hazards (chemicals/heights).
5. Similar Skills:
Similar skills refer to the knowledge, physical skills, and motor skills needed to perform a job. Examples include:
i) Education;
ii) Training;
iii) Experience; and/or
iv) Manual dexterity.
9. Suzanne Desrosiers Professional Corporation:
For assistance in updating your employment policies and procedures and/or providing training to staff members, please contact Suzanne Desrosiers today, at suzanne@sdlawtimmins.com or 705-268-6492.
