Amendments to the Canada Labour Code Receive Royal Assent
In November, we informed readers about proposed amendments to the Canada Labour Code contained in the Jobs and Growth Act, 2012. The Act has been passed and received Royal Assent on December 14, 2012.
The provisions of the Act amending the Code will come in to force on a future date to be fixed by an order of the Governor in Council. When the provisions come in to force, the Code will be amended to:
- Change the timeline for the payment of vacation pay after termination. Employers will be required to pay unpaid vacation pay within 30 days of the date on which an employee ceases to be employed.
- Change the method of calculating holiday pay. Most employees will be entitled to holiday pay equal to one-twentieth of their wages (excluding overtime) in the four week period before the general holiday. Employees paid, in whole or in part, on the basis of commission, will generally be entitled to be paid holiday pay equal to at least one-sixtieth of their wages (excluding overtime) in the 12 week period before the general holiday.
- Formalize the process for unpaid wages and other minimum standards complaints, excluding unjust dismissal claims. Employees will generally have six months from the date of an alleged violation to file a written complaint with an inspector. Inspectors will be authorized to mediate complaints. Inspectors will also be able to reject a complaint if, among other things, he or she is satisfied that the complaint is outside his or her jurisdiction, the complaint is frivolous, vexatious, or made in bad faith, or the complaints relates to a matter covered by a collective agreement. If a complaint is rejected, the employee may, within 15 days, request a review of that decision. The rejection may be confirmed or rescinded by the Minister.
- Limit payment orders. An inspector’s power to make payment orders will be limited to the amounts allegedly owing in the 12 month period before a complaint was made, or the date the employee was terminated. If an employee has not complained, an inspector’s power to make a payment order is limited to the amounts allegedly owing in the 12 month period before the date the inspector began his or her investigation. The 12 month limit is extended to 24 months in cases of unpaid vacation pay.
- Create a new level of review for payment orders or notice of unfounded complaints. A person who is affected by a payment order, or who was issued a notice of unfounded complaint may file a written request for review within 15 days. The decision may be confirmed, rescinded or varied on review. The review decision may be appealed to a referee appointed by the Minister, but only on a question of law or jurisdiction.
The amendments requiring certain complaints to be filed within six months, and limiting payment orders to amounts owing in the last 12 months have the potential to be particularly significant for federally-regulated employers. Currently, the Code contains no limitation periods on the filing of complaints, and no limit on the number of months for which unpaid wages may be claimed.
We will update readers again when the amendments are in force.