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Some Comments on the Stronger Workplaces for a Stronger Economy Act (Ontario)

The Ontario Liberals introduced a Bill yesterday targeting ‘vulnerable workers’.  It’s Bill 146, given the short title, the Stronger Workplaces for a Stronger Economy Act, 2013.  There was considerable media coverage of the Minister’s press conference.  Here’s the front page story from the Toronto Star.  The Minister claimed that some of the ideas were taken from the recently released Law Commission of Ontario report on Vulnerable Workers and Precarious Work. 

Since the December holiday break is about to begin, and there’s a real likelihood that the opposition parties will provoke an election in the new year, the prospects for this bill passing aren’t great.  But it at least begins a discussion and includes some real ideas.  The Bill includes 5 substantive parts:

It introduces new protections for foreign nationals working in Ontario by extending protections for live-in caregivers in the Employment Protection for Foreign Nationals Act to other foreign nationals working or looking for work in Ontario, such as temporary foreign workers.

It changes the definition of a “worker” in the Occupational Health and Safety Act to include people who are performing work for no

Minister of Labour, Yasir Naqvi

Minister of Labour, Yasir Naqvi

pay, such as unpaid trainees (commonly called ‘unpaid interns’).  This closes what the media called “a loophole” in the OHSA that protected only workers who are paid.  This is an obvious improvement, though frankly I suspect it has been overplayed in the media.  Most ‘unpaid interns’ are working in workplaces side by side with other ‘paid’ employees, who were always covered by the OHSA.  This means the employers and their policies and practices were already governed by the OHSA.  There are some individual worker rights in the OHSA, like the right to refuse unsafe work, but hardly any nonunion employees ever exercise those rights in practice.  So this change is an obvious one to make, since there’s no reason why an unpaid worker should not be covered by the OHSA, but it won’t spark any great revolution in the treatment of unpaid workers.

It reduces the “open period” for  decertifications and union “raids”  in the construction industry from 3 months at the end of a collective agreement to 2 months. This change has nothing to do with vulnerable workers, and was just slipped into this bill for convenience’s sake I presume.

It amends the Workplace Safety and Insurance Act to clarify responsibilities for  workers who are injured during a job placement arranged by a temporary help agency by attributing the costs to the employer where the injury occurs and assessing wages by reference to income earned from the agency.

Proposed Amendments to the ESA

By far the most extensive and interesting provisions relate to the Employment Standards Act. There are some new, interesting and good things in here.  The amendments to the ESA can be separated into three categories for the sake of discussion.

1. Extended Damages

Firstly, the Bill replaces the current 6 month cap (in Section 111) on back wages with a 2 year limit, while also removing the $10,ooo cap on damages for unpaid wages.   These changes will allow workers to recover a greater proportion of their actual lost wages when employers have violated the ESA over an extended period of time.

2.  New Temp Agency Record Keeping and Joint and Several Liability for Temp Agency Workers

Secondly, the Bill imposes new rules on temp agencies.  It creates new record keeping responsibilities for temp agencies to track and record every hour worked by a worker and retain those records for three years. It also  introduces the concept of “joint and several liability” in the case of employees sent to work for an employer by a temp agency.  This makes sense, since from the employee’s perspective, it doesn’t matter which business is responsible for the wages, as long as one of them is.  In practice, this law will cause employers that use temp agencies to make clear arrangements as to which of them will be responsible for ESA compliance.  It’s a good change.

3.  New Information Disclosure Requirements (Posters) and “Self Audits”

The remaining parts of the ESA reforms engage a theory I pushed in my short submission to the Law Commission study.  An important reason why the ESA has poor compliance is that employers and employee don’t understand the rules. Employers don’t bother to learn them, and employees don’t even know where to look.  This is a basic failure of legal modelling.  The point I have been arguing for years is that with some simple changes, the ESA could harness the employer as a source of “legal learning”.  It can do this by:  (1) requiring employers to distribute information to employees describing their legal entitlements under the ESA, and how to enforce them; and (2) requiring employers to learn and explain how they are complying with the ESA.  The specific legal design I advocated to achieve these outcomes differs from what appears in Bill 146, but the basic spirit is there.

Here’s what the new law would do. First, it would require employers to provide each employee with a “poster” prepared by the Ministry of Labour that describes ESA entitlements.  At present, the employer is only required to post the document in the workplace.   This should put more information about the law into the hands of employees, and tell them how to learn more. I had proposed two new mandatory forms to be provided by employers to employees: (1) a statement of employment at the beginning of employment and a (2) a statement of the end of employment.  Both forms would describe what the ESA entitles the employee and what the employee is actually receiving.

The idea behind my proposal was twofold. First, it would force employers to learn the law and whether they are complying with it. And, second, it would educate employees on their legal entitlements.  Bill 146 doesn’t go as far as my proposal, but it steps in that direction by requiring distribution of the ESA poster to every employee, and by another new tool:  the employer “self-audit”.

The ‘self-audit’ is the most novel piece of the law.  I like it.  It gives an ESO the power to order an employer to conduct a ‘self-audit’ of its records to determine if it is in compliance with the Act or Regulations (new s. 91.1).  The employer must conduct the audit and report its findings to the ESO.  This is brilliant, because it forces the employer to do much of the initial legwork of investigating a complaint, saving ESO time and resources, while forcing employers to learn the law.  It potentially achieves the same benefits I was going for in my proposal.  It forces ‘self-learning’ , or self-reflection to use the language of regulatory theory.  The self-audit must include an explanation of how the employer calculated whether it was in compliance (this was in proposal too).  Providing false information would violate a new section of the ESA.  The ESO can still conduct their own investigation, and make a finding that the employer is in contravention.

The “self-audit” could be a useful new tool for enforcement, provided that ESO do their jobs of critically assessing the audits, and not just accepting whatever the employer concludes.  [Query whether an employee (through their representative perhaps) can demand to see a copy of the audit.  Will the audits become part of the evidentiary record in ESA proceedings?  I'd presume so, but the Act doesn't say anything about this.] 

The self-audit device could be used to police “unpaid internships”, and indeed that may be the intention of the government.  ESO could order every workplace using interns to prepare an audit of whether the intern is properly being treated as a non-employee under the Act.  Many of these audits, if conducted properly, will disclose that the interns should rightly be treated as employees.  The beauty of this device is that it could lead to “interns” receiving their ESA entitlements without them having to instigate the complaint themselves.  This is important, since hardly any employees file ESA complaints for fear of reprisals.  Virtually every ESA complaint by nonunion employees is filed by ex-employees.  The audit device could be used to promote compliance during employment without the employees having to instigate the process.  All is required is an ESO letter to the employer ordering the employer to explain how it is complying with the law.

 Final Thoughts:  Much Ado About Nothing?

As just described, I think there’s some good things in this Bill.  If used to it’s full potential, it adds some important new weapons for employees and inspectors in the fight to improve compliance with the ESA.  The ‘self audit” in particular has great potential, if used effectively.

On the other hand, the Bill is quite modest.  For example, despite all the recent media attention on the exploitation of “unpaid interns”, Bill 146 leaves the definition of “employee” that creates the means for employers to treat trainees as free labour untouched.  In my opinion, the government should have tightened up the level of oversight over unpaid trainees by adopting a simply three step plan, as I described earlier this week.  The Bill also rejects calls from many who participated in the Law Commission study for an anonymous complaint system to permit workers to report violations without the risk of filing a complaint.

More importantly, most vulnerable workers still have no effective access to collective voice and representation in their workplaces. They are alone and in great fear of losing their jobs.  Organizations like the Workers’ Action Centre deserve a lot of credit for lobbying efforts in support of these changes.  Organizations like this, and unions, could do a lot more for vulnerable workers if they were given additional tools to advocate on their behalf.  Most vulnerable, low wage workers don’t have a realistic change of accessing full-fledged collective bargaining, because our laws governing unionization make it impossible  for them to unionize.  But it’s possible to legislate a secondary collective representation model that allows organizations that defend workers to obtain an audience with employers and to act collectively on their behalf, outside of formal collective bargaining.  I’ve explained that model in this paper, called Graduated Freedom of Association, for you labour law geeks.   The stark reality is that an ESA model that depends primarily on individual, vulnerable workers enforcing their own legal rights by picking fights with their employers will always be a deficient model.  Stronger collective voice or relentless enforcement by the state are the only real options to protect vulnerable workers from predatory employers.

Issues for Discussion

What do you think of the new rules and tools in Bill 146?

Will this law lead to noticeable improvements in working conditions for Ontario’s most vulnerable workers?

Would you have done more, or something different?

Will Bill 146 address the problem of exploitation of unpaid interns?


3 Responses to Some Comments on the Stronger Workplaces for a Stronger Economy Act (Ontario)

  1. Dan McGarry Reply

    December 9, 2013 at 5:20 pm

    Without addressing the other aspects of this Bill and it pros and cons, if passed as it stands it could eliminate many independent staffing services.

  2. Fernando Reis Reply

    December 9, 2013 at 9:50 pm

    The Liberals keep rewarding the construction unions for their support. The construction sector has card based certification and now the decertification period has reverted to 6 months. Why not apply a consistent standard for all bargaining units? Furthermore, the proposed changes to the Labour Relations Act still do not address the needs of agricultural workers and domestics.

  3. Pingback: UQAM | Blogues |, le blogue juridique » Archives du blogue » Agences de placement et travailleurs étrangers : un pas en avant en Ontario

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