The Government of Canada recently amended the Canada Labour Code as part of its omnibus budget implementation bill, Bill C-45. The bill, titled the Jobs and Growth Act 2012, was first introduced in October, and received Royal Assent on December 14, 2012. The resulting amendments to the Code focus on three areas: vacation pay, holiday pay and the complaint process.
Prior to the amendments, there were no deadlines for an employer to provide employees with unpaid vacation pay after their employment ended. Now, an employer must provide an employee with unpaid vacation pay within 30 days from the date on which the employee is no longer employed.
Holiday pay under the Code has been changed in a number of respects by Bill C-45. The Code now includes the term “holiday with pay”, which modifies the calculation of holiday pay. For employees who receive regular wages, this new calculation provides for the payment of one-twentieth of the wages earned over the four weeks preceding the week in which the holiday falls, excluding overtime. For commission-based employees, the calculation is one-sixtieth of the wages earned, not including overtime, over the 12 weeks preceding the week in which the holiday falls. Employees are not entitled to receive holiday pay in the first 30 days of their employment.
The complaint process under the Code has been amended in a number of ways concerning time limits. Complaints related to unpaid wages and other amounts must be brought within six months. Orders for the payment of wages or other monies are limited to the 12-month period preceding the date the complaint was made, the employee was terminated, or an investigation was commenced. An exception to this rule provides that an order for vacation pay is limited to the 24-month period preceding the complaint, termination, or investigation.
The complaint process amendments also affect the powers of inspectors investigating complaints. Inspectors now have the power to assist parties in settling complaints, to suspend investigating the complaint if the inspector feels the parties should attempt other measures, and to reject a complaint based on a reason listed in the Code. Finally, the amendments set the time frame for applying for a review of a complaint at 15 days, with the review being heard by a referee appointed by the minister.
These amendments will come into force on a future date, to be fixed by an order of the Governor in Council. We will be sure to alert our clients when the changes come into effect.
If you have any questions concerning the information presented in this article, please contact Kirsten Hume, Partner.