III. Employment Standards Policy and Legislative Reform: The Employment Standards Act and Related Legislation

////III. Employment Standards Policy and Legislative Reform: The Employment Standards Act and Related Legislation
III. Employment Standards Policy and Legislative Reform: The Employment Standards Act and Related Legislation2017-03-03T18:36:57+00:00

This Chapter considers possible reforms for the Employment Standards Act and related legislation. It covers policy considerations, establishing a broader basic floor of minimum rights and expanding knowledge of employee rights and employer obligations. Enforcement is a central ingredient to effective employment standards and both proactive and reactive enforcement systems must respond adequately. Finally, this Chapter discusses mechanisms that support ESA compliance and enforcement both generally and in respect of specific classes of vulnerable workers. 

  

A.    Broad Policy Considerations

Employment standards in Ontario are regulated through the Employment Standards Act, 2000 (ESA) which sets out the minimum rights of workers and the obligations of employers.[235] The ESA regulates a wide variety of work-related issues, including minimum wages, employment records, hours, vacation, leaves of absence, termination and severance and includes relevant enforcement provisions as well as special protections for workers at temporary help agencies. Although the legislative framework provides for basic minimum protections for many workers, extensive exemptions and special rules for workers in specific industries have been enacted, primarily through regulations. The ESA applies to all workers; however, it is most significant for non-unionized employees, since unionized workers often have higher standards and mechanisms to enforce contracts. 

The ESA came into force in Ontario in 1969, combining several work-related statutes.[236] Since its enactment, it has frequently been amended. Legislative changes in the 1970’s to early 1990’s mostly expanded legislative protections for workers with the introduction of termination notice requirements, severance pay provisions, pregnancy leave and bankruptcy protection.[237] Not all changes made during this period expanded rights, however, as lower minimum wage rates were introduced for servers in the hospitality industry.

Reforms introduced in the mid-1990s promoted increased “flexibility” for employers with shorter limitation periods and limits on the amount that could be claimed for lost wages. The Ontario government imposed a multi-year minimum wage freeze over this same period.[238] Government statements at the time of these legislative changes emphasized flexibility, but also highlighted the need to protect the most vulnerable workers. As well, certain leave provisions were expanded and clarified. 

When the Employment Standards Act, 2000 was introduced, major changes were put in place with the introduction of increased parental leave provisions, anti-reprisal protections and personal emergency leave.[239] Some restrictions were removed for eligibility for public holidays and certain enforcement provisions were introduced. At the same time, the maximum number of hours worked per week could be increased by agreement between employee and employer, breaks and vacation periods could be divided into smaller time periods, and overtime could be averaged over a four-week period.

In response to the growth in temporary help agencies, new protections for temporary help agency workers were introduced through the Employment Standards Amendment Act (Temporary Help Agencies), 2009.[240] These provisions require agencies to provide workers with information about the agency, the assignment and working conditions and they prohibit workers from being charged fees. Temporary help agency workers are now covered under the ESA provisions relating to public holiday pay, termination and severance. As well, restrictions have been removed from client employers entering into employment contracts with workers. 

The ESA saw further amendments in 2010 under the Open for Business Act, 2010.[241] The Act created a number of obligations for employees seeking to make a claim under the ESA with the result being that claimants are now usually required to approach their employers before an ESA claim will be investigated, although in certain cases, such as vulnerable employees, the obligation may be waived. Employment Standards Officers (ESOs) were also given the ability to facilitate settlements at an early stage in the proceedings upon consent of the parties. According to Vosko et al, up to 80% of cases are resolved at the early stage through compliance with an ESO determination of wages owing, settlement, withdrawal or denial of complaint. Workers’ advocates are concerned that claimants feel pressured to settle for less than is owed. Further, they regard negatively any pre-order activities that do not result in a formal finding against the employer. From their perspective, it is important that formal records be kept of non-compliant employers for future enforcement proceedings.[242] 

Much has been written and said about the workplace relationship regulatory scheme. While the following comments heard by the Fairness at Work panel relate to the Canada Labour Code system, they are reflective of the two divergent views that have emerged about the ESA.[243] 

In hearings, briefs and research reports, two broad views of the workplace relationship emerged. On the one hand, many employers tended to emphasize its contractual, consensual, bilateral character. “Let us work these matters out with our employees,” they might say, or, “Our employees are happy with their working conditions,” or even, “Terms and conditions should be a matter of contract between employer and employee.” On the other hand, many unions, workers and advocacy groups tended to emphasize the inherent imbalance of power between workers and employers that, in their view, prevents fair dealing in the labour market in general, and in most employment relationships in particular. They argue that regulation is needed to undo the results of this imbalance, from which no fair consensual or contractual understandings could possibly emerge. The first position may be somewhat closer to the way the law has historically regarded employer-employee relations; the second may often be closer to the realities of the contemporary world of work. However, neither perspective can be ignored. In life, as in law, workplace relations are shaped both by contract and by regulation.[244] 

In a similar vein, the LCO’s research and consultations revealed a great deal of concern among workers’ advocates and academics that the ESA claims process, as currently configured, places too onerous a burden on employees to self-advance their own claims. Workers’ advocates argued for a system that places less responsibility on employees to pursue individual claims, tipping the balance in favor of increased government initiated inspections, investigations and prosecutions. From this perspective an ideal enforcement model is envisioned as both expeditious and consistent with an emphasis on mandatory, deterrent responses. Workers’ advocates and academics also favored expanding legislative protections. Employers, on the other hand, expressed concern about the impacts that increased regulation and the resultant increased expenses would have on their businesses which must compete in a global economy. Employers favored compliance support for businesses under the existing enforcement provisions. Workers themselves were primarily concerned about accessing the protections in the current legislation and fear of reprisal.

Since the enactment of the original ESA, government has been cognizant of the need to balance workers’ and employers’ interests. In 1968, at the introduction of the legislation, the Minister of Labour made the following comments: “when it comes down to considering improvements in standards of employment, we must improve but also maintain a balance that will help us to keep industry and to attract new industries to the province.”[245]  

This balancing act has been the driving force behind the multiple amendments to the ESA over the years. The result is an Act that sets out broad employment protections but limits them through special rules and exemptions. Some sections of the Act do not apply to smaller businesses. Sector specific rules or exemptions have been enacted for certain industries such as agriculture, construction, residential care workers and restaurants and accommodation. In other cases, casual, temporary or part-time workers may not qualify for certain protections due to insufficient hours or the discontinuous nature of their employment. The result is a legislative framework that, some argue, no longer meets its objective in providing a basic floor of minimum rights for all workers.  

In the meantime, the struggle to find the balance continues. As noted in Fairness at Work:  

What, then, to make of the argument that state regulation also has its limits, that if regulation places excessive burdens on business and cripples the economy, we will all be worse off ­- vulnerable workers, their employers and all the rest of us? This is not merely a legitimate concern; it is a crucial question. Nonetheless, most people agree that at some undefined point this concern must be set aside, and moral or normative concerns must be allowed to trump economic or business concerns. In this day and age, in a country with Canada’s affluence and moral aspirations, we are not likely to tolerate certain kinds of working conditions.[246]

For the LCO, the question is whether in today’s economy and moving forward into the future, Ontario is striking the right balance and, if not, what new direction should be taken.

 

B.    Basic Floor of Minimum Rights

1.    Reducing and Updating Exemptions

As we have noted, the ESA purports to legislate minimum employment standards but contains a multitude of special rules and exemptions. In some cases, exceptions are industry specific, where the ESA sets out differential treatment for certain categories of workers.[247] For example, there are four categories of agricultural workers: farm workers, harvesters, near farmers and landscape gardeners. All but farm workers are entitled to minimum wage. Harvesters are entitled to public holidays but farm workers, near farmers and landscape gardeners are not. There are special rules set out for construction workers and many other industries. Hours of work, eating periods and overtime pay are other areas where there are specific exemptions for certain industries. Farm workers and harvesters are exempt from all of these.  

In other cases, non-standard workers do not qualify for certain protections of the Act because of discontinuous employment or insufficient time worked. While precarious employment is not “synonymous with non-standard employment”, labour insecurity is often associated with engagement in non-standard and/or discontinuous forms of work.[248] As it stands, most provisions of the ESA do not explicitly exclude non-standard employees. In fact, there are a number of provisions that explicitly take into account discontinuous periods of employment. There are, however, instances where ESA coverage is dependent upon a qualifying period. For example, persons holding multiple part-time positions may work 60 hours a week but never qualify for overtime pay as they do not work more than 44 hours a week for any individual employer. Similarly, persons in successive temporary positions may never qualify for two weeks’ vacation as they may never work 12 months at any given position. Termination notice requires at least three months employment. Severance pay requires five years of employment and the employer must have a payroll of $2.5 million or the discontinuance must be part of a mass termination. In this case, not only does length of service determine eligibility but size of the business enterprise is a determinative factor in qualifying for protection. While these qualifying periods may serve those in standard employment relationships, the growing numbers of workers in non-standard employment may need additional types of coverage. 

An example of legislative amendments recognizing new work realities were the changes that made termination and severance provisions applicable to employees of temporary employment agencies. Under The Employment Standards Amendment Act (Temporary Help Agencies), 2009 that came into force on November 6, 2009, workers who obtain work through temporary help agencies are deemed to be the assignment employees of the agency, who is the employer. As a result, severance and termination provisions under the Employment Standards Act are applicable to these employees as long as the employment relationship between the agency and employee continues, whether or not the employee is working on an assignment with a client of the agency. 

The web of special rules under the ESA are so complex that the Ministry of Labour has developed extensive interpretive material to assist in identifying which standards are applicable to any given work situation. It is likely that each industry specific exemption was put in place in response to a perceived industry need relevant at the time of enactment. From workers’ advocates point of view, however, “most of the exemptions relate to the regulation of overtime pay, hours of work and minimum wage, enabling a regulatory regime that allows employers to minimize the costs and scheduling of labour.”[249]

In our view, legitimate concerns have been raised about the current relevance of the exemptions. Time has passed and the Act has been amended on a piecemeal basis over an extended period of time. The result is an Act that is difficult to comprehend and navigate. The effect has eroded Ontario’s intended legislative message of commitment to broadly available minimum workplace protections. In the LCO’s view, it is time to update, review and streamline the ESA’s exemptions. It is important to determine whether each is based on legitimate, current public policy and industry considerations. Industrial exemptions that are no longer relevant or justified should be repealed. For part-time, casual and temporary workers, given the proliferation of this type of non-standard work, serious efforts should be made to identify and close gaps in protections.  

The Law Commission of Ontario recommends that:

1. a) The Ontario government, in consultation with labour and owner/management stakeholders, update, review and streamline the exemptions within the ESA and related regulations including a review of existing occupational specific exemptions, with the objective of ensuring any exemptions are justified on current public policy and industry considerations; and

b) the review develop and use principles that aim to promote a broadly available minimum floor of basic workers’ rights, including that justifications for exemptions be balanced against the need to reduce precarious work and provide basic minimum standards to a broader sector of the working population.

Public policy considerations should take into account a modern understanding of the new economy and of the negative implications of precarious work and particularly its disproportionate impact on racialized persons, women, the disabled, Aboriginal persons, youth, recent immigrants and those working in certain sectors. Each exemption should be reviewed with these considerations in mind with the overall objective of reducing vulnerability and providing a more uniform and broadly available set of minimum rights for Ontario’s workers. An Innovative Solutions for Precarious Work Advisory Council as recommended at Recommendation 28 could provide the Ministry of Labour with advice on the relevance, justification and impact of sector specific exemptions and special rules.  

The ESA would benefit from a broad policy statement in a preamble to the Act to underscore the government’s commitment to ensure basic minimum employee protections, support compliance and foster public, employer and employee awareness and education. A similar amendment was made to the Occupational Health and Safety Act in response to the Dean Report, in which a new section was added outlining the Minister of Labour’s powers in regard to the promotion of occupational health and safety and prevention of diseases, promotion of public awareness, fostering a commitment to health and safety among employer and workers and education.[250] 

The Law Commission of Ontario recommends that:

2. The Ontario government consider codifying within the ESA a broad policy statement highlighting its commitment to protecting basic minimum employment rights, supporting compliance and fostering public, employer and employee awareness and education.

 

2.     Minimum Wage 

As the legislative framework for minimum employee protections, the ESA is the source of minimum wage determinations. According to Statistics Canada, in 2009, 8.1% of Ontario workers earned minimum wage. The Canadian average was 5.8%.[251] As of March 31, 2010, the rate in Ontario for minimum wage is $10.25 an hour for most jobs, the highest provincial minimum wage in Canada (along with British Columbia), with only Nunavut and the Yukon being higher at $11.00 and $10.30 an hour, respectively.[252] The minimum wage has been raised by approximately 50% from $6.85 in early 2004 in part to offset earlier freezes and to ensure minimum wages were outpacing inflation.[253] For some years leading up to the increases, advocates had called for bringing the minimum wage up to $10.00. After seven increases, in February 2011, the government announced that it would not raise the minimum wage further but instead would “appoint a committee representing both business and workers to provide advice on the minimum wage in advance of the 2012 budget.”[254] However, the budget has since been tabled and this Committee appears not to have been convened.

Some workers’ advocates and academics are continuing to call for additional increases to minimum wage, in some cases up to $14.55 per hour.[255] Other suggested possibilities have included tying the minimum wage to the low income cut-off (LICO) index, with annual cost of living adjustments or regulating the rate through a body independent of government or having the minimum wage adjusted for inflation.[256] Employers and others have cautioned about the negative impacts of steep increases.[257] In its 2011 report, the Canadian Federation of Independent Business took the position that substantial increases in minimum wages tend to hurt rather than help low income employees in small and medium businesses where employers must absorb the additional costs through reduced hours, reduced training or job cuts.[258] Many minimum wage earners are employed in such enterprises and they would bear the costs of such increases. The work of the proposed Committee would have been instructive had it been implemented. In the absence of any clear direction on minimum wage, we are of the view that it is crucial that such work be commenced by this minimum wage Committee.

The Law Commission of Ontario recommends that:

3. The Ontario government convene the minimum wage Committee, or similar body, to review minimum wage issues and recommend a transparent and fair process for determining future adjustments to minimum wage that balances business, economic, labour and poverty issues.

3.     Same Pay for Equal Work

The LCO’s consultations and research revealed the need for a response to the situation of part-time workers receiving lower pay than full-time workers. While there are often legitimate business reasons to hire part-time employees, some employers appear to use part-time employment to hire workers at a lower rate.[259] Unless there is a justification for the difference based on skill levels, experience or job description, Arthurs argues that such discrepancies are unfair to part-timers and, ultimately, will reduce the standards of full-time workers as well.[260] The negative impacts of this situation are exacerbated by the fact that part-time work is highly gendered and that, among part-time workers, women are more likely to be low-paid.[261] As noted earlier, while choice is a factor for many women engaging in part-time work, the choice is frequently illusory where women are bound by home and care-giving responsibilities. 

Findings also suggest that single parents, often women, racialized workers and recent immigrants are more likely to find themselves in part-time, temporary work.[262] Paying part-time workers at a lower rate than full-time workers disproportionately creates vulnerability in traditionally disadvantaged groups. Within the Project Advisory Group, some members commented upon the need for such provisions to be extended to all workers including casual, temporary and part-time. This would appear to be justifiable in the absence of some clear basis for distinguishing the work done on the basis of experience, skill or job description.

The Law Commission of Ontario recommends that:

4. The Ontario government consider amendments to the ESA to require all workers in equivalent positions to be paid at least at the same rate as their permanent full-time equivalents.

4.     Benefits

Arthurs suggested that the government investigate a range of possibilities for developing new vehicles such as a benefits bank or other mechanisms for delivering benefits coverage to non-standard workers through an employee and/or employer purchased group insurance plan or plan delivered by a public agency.

Whatever is the right model, some way must be found to provide benefits coverage for vulnerable workers who do not now have access to it. Moreover, it would be better if the solution were found sooner rather than later. As unionization rates decline, as more workers move from large firms to small firms, as more workers move from regular employment to non-standard contracts or self-employment, the case for a new approach to benefits insurance comes to rest on a new basis: not only do vulnerable workers need protection, but so too does a growing proportion of the entire workforce.[263]

One proposal that has been suggested to address temporary workers’ need for benefits is to require employers to pay a premium for short term contracts. Whether this notion, which is in place in France for temporary agency workers and fixed term contract workers, who receive an additional percentage of their pay (10% and 6% respectively) at the completion of the work assignment, could be adapted for some or all short term workers to compensate for the lack of benefit, may be a future consideration for the government after consultation with employee and employer stakeholders. We recognize that such an innovation would have significant cost implications for employers. Therefore consideration of such an initiative would necessarily require an extensive analysis of the costs and benefits to all parties in order to determine the best course of action. A review of the initiative’s experience in France in the face of the recent economic turmoil would also be warranted. The Innovative Solutions for Precarious Work Advisory Council (Recommendation 28) could consider these issues.

The Law Commission of Ontario recommends that:

5. The Ontario government, in consultation with labour, management and insurance representatives, explore options for the provision of benefits for non-standard and other workers without benefits coverage, with consideration given to the concepts of a benefits bank and mandatory short-term contract premium for temporary workers, among other options.

 
5.     Emergency/Medical Leaves       

Personal Emergency Leave for Non-Standard Employees

The personal emergency leave provisions of the ESA provide for an annual 10 days of unpaid leave for illness, injury, medical emergency, bereavement or urgent situations related to close relatives. These provisions are only applicable to employees whose employer regularly employs 50 or more employees. While not explicit in the Act, the Ministry of Labour indicates that part-time employees are eligible for the full 10 days annually even where the employment has commenced part-way through the year.[264] The ESA Policy and Interpretation Manual is silent about the eligibility of temporary employees for personal emergency leave. By contrast, the manual is explicit that family medical leave, for example, is available to contract employees.[265]  

Family medical leave is an eight week leave to provide care or support to prescribed family members for serious medical conditions with a significant risk of death. Unlike personal emergency leave, it is not restricted to larger businesses. Family caregiver leave, another eight week leave introduced in the Legislature in December 2011 will, if passed, provide up to eight weeks of unpaid job protected leave for employees to provide care and support to a sick or injured family member with “a serious medical condition”. Death need not be imminent and there is no restriction for those working in small businesses. Family caregiver leaves represent a relatively recent legislated recognition of workers’ family responsibilities. Yet these leaves are not dependent upon the size of the employer’s enterprise as is the case with personal emergency leave. 

In the LCO’s consultations, respondents noted that the lack of access to personal emergency leave is particularly difficult for vulnerable workers who often work in smaller businesses.[266] The example of pregnant women attending medical appointments was raised as a particularly critical gap. Some employer organizations noted that the leave provisions did not necessarily benefit lower wage workers as the provisions were primarily accessed, and in some cases inappropriately used, by workers in higher-skilled positions. Some members of the Project Advisory Group supported extending personal emergency leave to all employees and enacting provisions for paid sick leave.  

The LCO believes that personal emergency leave should be available to all workers notwithstanding the size of the enterprise. We are aware, however, that smaller enterprises may be operating with much less flexibility than larger ones. Employers have also raised concerns about their ability to maintain competitiveness in the face of lower regulations in neighbouring jurisdictions.[267] One suggested possibility is to legislate extended personal emergency leave while, at the same time, categorizing available leaves into more defined categories as is the case in Prince Edward Island. Prince Edward Island’s employment standards legislation provides three days per year for illness and injury; in addition, after five years of employment, one day of paid sick leave is available. Three unpaid days of leave are available for bereavement, one day of which is paid in the case of the death of an immediate family member.[268] The downside for workers is that more defined limits would be placed on the amount of leave that could be taken for any given category; however, the protection would be extended to all. We note that Prince Edward Island is the only Canadian province to have introduced provisions for paid sick leave in employment standards legislation and the provisions are very limited. Project Advisory Group members raised the issue about how to ensure that part-time, temporary and casual workers are extended some form of these benefits and that such availability is clearly communicated to employees. 

The Law Commission of Ontario recommends that:

6. The Ontario government review personal emergency leave provisions in the ESA to determine ways to extend the benefit to workers in workplaces with fewer than 50 employees (including part-time, casual and temporary employees.)

 

Extended Medical Leave

Some members of the Project Advisory Group believe that the Employment Standards Act should protect workers in cases of long-term illness. Anecdotal evidence was cited about promising European models for mandatory employer paid insurance plans. Also raised was the possibility of a legislated requirement for employers to extend benefits to non-standard workers when full-time employees were covered. Saskatchewan’s legislation requiring benefits for some part-time employees was raised, although the significant limits to that legislation are notable. In declining to recommend that employers provide benefits to non-standard workers, Arthurs comments are useful. 

No doubt some employers decide to deny coverage to non-standard workers purely and simply in order to lower their payroll costs. However, it is also likely that providing coverage for non-standard workers and those employed by SMEs [small and medium-sized enterprises] is more complicated and expensive than for regular full-time workers in larger enterprises. The actuarial problem of spreading risks from across a small group, the administrative diseconomies of small-scale plans and the problem of pro-rating certain benefits for part-time workers all represent potential disincentives to employers considering whether to provide benefits coverage to non-standard workers. These problems are severely exacerbated by the difficulties of collecting premiums from and providing benefits to a transient population, such as temporary and agency workers. It is not completely clear whether the barriers to benefits coverage that I have identified are real or merely hypothetical. However, I am not prepared to recommend that employers be required to provide benefits to non-standard workers unless and until I am convinced it is practicable for them to do so.[269]

 

C.    Knowledge of Rights and Obligations

1.     Public Awareness, Education and Outreach

In Fairness at Work, Arthurs observed  

the best prospects for securing compliance with labour standards involve programs to educate workers and employers concerning their rights and responsibilities…Where possible, these programs ought to be undertaken in cooperation with employer, worker or advocacy organizations.[270] 

Lack of workers’ and employers’ knowledge about their rights and responsibilities was a frequent theme raised in the LCO’s consultations by government, employers, workers, community service providers, workers advocates and academics alike.[271]   

The Ministry of Labour has made very extensive efforts to respond to concerns about lack of knowledge through the development of its ESA website providing multilingual information, special tools and contact information about the Ministry’s telephone line. Despite these efforts, the consultations demonstrated that limited access to computers, limited literacy and language skills, as well as fear of reprisals, created barriers for workers’ access to the system. In our consultations with temporary foreign workers, the LCO heard that some had received no information about their rights prior to arrival in Canada and did not know who to turn to for assistance.

Further efforts to increase public education would be an effective method for getting the message out. As an example, Working on the Edge proposed the promotion of employees’ rights and employers’ responsibilities through a Ministry of Labour public education campaign.[272] A campaign featuring ads, posters and information sessions would raise the profile of the legislation for both workers and businesses highlighting government support for protecting vulnerable workers and for supporting employers with ESA compliance. Based on the information we received during our consultations, the LCO notes the importance of active rather than passive public education. Emphasis by the Ministry of Labour on actively bringing the information to workers and employers rather than reliance primarily on the Ministry’s website would have a greater impact. Both employer and worker stakeholders noted concerns about over-reliance on the internet for disseminating public information. Not everyone has access to the internet and rural Ontario does not always have access to high speed internet. Public education materials and sessions should be situated where the workers and employers are, in public places such as subways, buses, television and in workplaces. Existing government-employer-employee committees can be another way to disseminate information. Such a campaign could be initiated as part of a larger provincial strategy that we recommend in Recommendation 52.

The Ministry of Labour currently conducts some outreach information sessions with worker and employer groups. Programs like these, particularly those that feature person-to-person contact between the Ministry and the employment community, should be supported and expanded. Increasing ESA access through direct personal contact as well as partnerships between the Ministry and employment community have been proposed by various commentators.[273] The Ministry of Labour is well-positioned to continue to expand its current outreach programs and to develop community partnerships through the implementation of initiatives aimed at workers in industries and groups that are disproportionately affected by precarious employment including temporary foreign workers, recent immigrants, youth, the disabled, racialized persons, Aboriginal persons and women. 

A number of commentators have advocated a model based on the New York Wage Watch Program, initiated as a pilot in 2009 by the New York State’s Department of Labour.[274] This Program is a formal partnership program between government and community agencies to hold workers’ rights sessions, provide employers with compliance information, distribute literature and refer cases of encountered violations to the Department of Labour. It is an innovative project that trains community members who work closely with workers and employers on the ground and with government agencies tasked with administering labour laws. The program has attracted some controversy in that it is framed as an information and education program, yet opponents have expressed concerns that it is, in reality, a form of community enforcement that is being used as a mechanism for union organization.[275] Further, opponents contend that the program was implemented without consulting the employer community. In our view, a program that builds community-government partnerships to increase knowledge of rights and responsibilities would be beneficial. Consistent with the Drummond Report’s recent recommendation for more stakeholder and community group involvement in policy development, implementation of any such program would require consultation with employer and workers’ organizations and careful study of the effectiveness and impacts of New York’s program.[276]

As recommended in Recommendations 13 and 24, expansion of the workers’ rights services of the Legal Aid Ontario clinic system and/or community agencies serving vulnerable workers would be another option for enhancing capacity for educational sessions and the development of government-community partnerships. The objective would be to heighten ESA awareness. It would have the potential for decreasing fear among workers in pursuing legitimate ESA claims resulting in increased access to justice. 

The Law Commission of Ontario recommends that:

7. The Ministry of Labour:

a) launch a public awareness campaign on Employment Standards Act rights and responsibilities;

b) to support workers’ and employers’ needs for additional information about the ESA, continue to offer and to expand capacity for providing outreach through ESA informational/educational sessions including but not limited to those in high risk sectors and groups; and

c) develop partnerships with employer, employee and community organizations to enhance worker and employer knowledge of ESA rights and responsibilities.

 

2.     ESA Handout at Outset of Working Relationship

A simple, virtually no cost strategy for increasing ESA knowledge and supporting compliance in the workplace could be achieved through a handout provided to employees at the outset of the working relationship. Currently, s.2(3) of the Employment Standards Act requires employers to display an informational poster in the workplace that outlines ESA rights and responsibilities and provides the Ministry of Labour contact information. This poster is available in printable form as a one-page document on the Ministry of Labour website. Employers can obtain it on the website free of charge and in multiple languages. We suggest an amendment to the ESA that requires employers at the outset of the working relationship to not only display the poster, but also give it in document format to all new employees both in English and the language of the worker, if available. In our view, this would increase the likelihood that basic ESA information would be made more accessible to workers. It would increase the chance that workers would take the document home, read it and possibly other family members would read it as well. Such an action has the potential for fostering conversation and inquiry. It may lead more workers to review the Ministry website. By providing such a handout at the outset of the working relationship, employers would set the stage for establishing a sense of commitment to ESA compliance in the workplace.

The Law Commission of Ontario recommends that:

8. The Ontario government amend the ESA to require employers to provide the ESA poster in document format to all new employees in English and, to the extent possible, in the language of the employee.

 

3.     Setting Out the Terms of the Employment Relationship

Arthurs emphasized the importance of employers and workers having a clear understanding of the terms of employment; he recommended a legislated requirement that employers provide non-unionized employees with written notice of rates of pay, hours of work, general holidays, annual vacations and conditions of work at the outset of the employment relationship. An obligation to set out in writing the status and terms of the working relationship would increase the likelihood of compliance by 

reminding employers of their obligation to obey the law, and by alerting employees to the possibility of taking remedial action if the law is violated…Clear understandings will facilitate legal recourse for the injured party and perhaps make the job of the defendant easier….[277]

Temporary agency workers must receive information describing work assignment, hours of work and rate of pay under s.74.6 of the ESA.[278] Now, pursuant to the new federal requirements, temporary foreign workers (NOC C and D and live-in caregivers) must receive this type of information in standard form employment contracts. This suggests government awareness of the protective effect of this type of written record for vulnerable workers. In our view, the requirement should be extended to all employees. A clear description of the terms of the employment received at the outset of the relationship has the potential for increased compliance and, if necessary, assistance in asserting ESA rights. In the Chapter on self-employment, a similar recommendation for independent contractors will be discussed.

The Law Commission of Ontario recommends that:

9. a) The Ontario government amend the ESA to require employers to provide all employees with written notice of their employment status and terms of their employment contract; and

b) the Ministry of Labour develop standard forms to support employers in this task.

 

D.   ESA Enforcement

1.     The Existing Model: A Critique

In this section, we describe Ontario’s general approach to employment standards enforcement and the challenges associated with it. Later, we discuss collateral issues arising from current ESA enforcement.   

Ontario’s ESA regulation model has been described as “a mix of ‘hard’ and ‘soft’ law approaches” with “soft” referring to the “government’s reliance on voluntary employer compliance or self-regulatory behaviour from firms” and the “hard” law approach including “orders to pay, compliance orders, and fines or prosecution”.[279] Arthurs observed that worker activists and academics tend to view the employment relationship as essentially an unequal power imbalance rather than one of equal parties to a contract, and because of this, they support a system which primarily focuses on investigation and prosecution of employment standards violations as public responsibilities similar to the criminal justice system. Such advocates reject the idea of a self-enforcement model that places, in their view, too much responsibility on individual claimants.  However, the reality is more complex. A purely public enforcement system such as the criminal justice system focuses on the public interest objective of achieving justice for society as a whole. Individual compensation to the harmed party plays a lesser role.  In our view, a purely public law model is not workable for employment standards because a key objective must be compensating individuals for their loss. Therefore, the system must, necessarily, retain elements of the civil justice process. As Arthurs points out, the system is a hybrid of regulation and contract, of public and private law.[280] 

Arthurs perceives the success of the existing model as highly dependant upon its ability to ensure compliance. 

Labour standards ultimately succeed or fail on the issue of compliance. Widespread non-compliance destroys the rights of workers, destabilizes the labour market, creates disincentives for law-abiding employers who are undercut by law-breaking competitors, and weakens public respect for the law.[281]

Ontario’s Ministry of Labour works to promote the “soft law” approach of voluntary compliance through its Education, Outreach and Partnership strategy. The Ministry’s website outlines of the goals of the strategy:

  • To create an environment where employers and employees understand their rights and obligations under the Employment Standards Act, 2000 (‘ESA’).
  • To increase employer awareness of responsibilities under the ESA by providing employers with the resources and tools to help them comply.
  • To encourage compliance with the ESA.

The Ministry’s approach demonstrates its understanding of the link between education and compliance. 

The Education, Outreach & Partnership (EOP) initiative began formally in 2009. Yet engagement with employers and employees covered by the Employment Standards Act, 2000 (ESA) has been part of the Employment Standards Program from its early history. It has long been recognized that education and compliance go hand in hand.[282]

Information is provided through a multi-lingual phone service administered through Employment Ontario which served 350,000 people in 2009-2010. The Ministry responded to 9,000 email inquiries in 2010 and the Ministry’s website has very extensive tools, videos and explanatory materials with many resources available in 23 languages.[283] The Ministry also engages in direct informational sessions with groups of employers and employees. 

However, as Doorey points out, this approach has its limitations.  

…many employers weigh the costs of compliance against the relatively low probability of being found in non-compliance and the weak penalties associated with a breach, and make an economic decision not to comply…The MOL already provides considerable resources on its various websites, and offers telephone assistance to provide advice to workers. However, few vulnerable employees know how to find these websites or even to look for them, even assuming that they have access to the Internet, or know about the telephone service. While the MOL has done a good job of translating some of the information into multiple languages, the general MOL website is in English and difficult for non-English speaking workers to navigate. More fundamentally, a model intended to aid vulnerable workers that places the burden on employees to conduct internet research and then claim their legal entitlements will always be ineffective.[284]

Our consultations revealed frequent reports of a lack of employment standards enforcement.[285] We heard about wages below minimum wage for temporary help agency and temporary foreign workers. Temporary foreign workers reported unpaid wages. Temporary agencies were reported as continuing to charge fees despite the new provisions prohibiting this practice.[286] Non-status workers were subject to multiple violations.[287] The LCO was made aware of “agents” who place temporary foreign agricultural workers with employers, creating a triangular employment relationship similar to the temporary help agency relationship. Employers do not pay more than minimum wage of $10.25 per hour to the agent, and the worker receives less from the agent (as low as $7.50 per hour).[288] Issues related to unpaid wages, vacation pay, termination pay, overtime and public holidays were the main complaints reported to the Ministry of Labour.[289] Some suggest that ESA violations are widespread.[290] 

What is strikingly clear from workers’ experiences is the “everydayness” of substandard working conditions. Workers do not come forward with just one experience of employer violations. When reviewing previous job experiences, it becomes clear that people in low-wage and precarious work experience violations of labour standards in job after job…workers go from one bad job to the next with no protection against employers’ violations.[291] 

Despite these reports, the LCO’s research and consultation revealed that many employers are compliant with the legislation.  

These findings do not indicate that all or most employers violate ES [employment standards]. Many employers do comply with the ESA. However, the prevalence of violations undermines employers who do comply with minimum labour standards and contributes to a downward pressure on wages and working conditions.[292]

Advocates have pointed out, accurately, in our view, that the current process overemphasizes investigating individual complaints of employer violations.[293] Detection of violations is largely through workers’ self-enforcement and individual claims. This approach has been described as “expensive and risks overloading available capacity.”[294]

There is general consensus that proactive enforcement is a much more effective mechanism for ensuring the protections of the ESA than the reactive system of responding to individual complaints. It has been suggested that the value of proactive inspections is demonstrated by the fact that violations were found in 40% to 90% of such inspections.[295] The success of this method is also attributed to the fact that 92% to 99% of confirmed unpaid wages are recovered through proactive processes whereas only about half are recovered through the individual claims process.[296]  

In Fairness at Work Arthurs said

I received many submissions to the effect that the [federal] Labour Program’s enforcement strategy ought to be more proactive. Instead of concentrating on processing workers’ complaints, inspectors ought to take the initiative randomly auditing sectors or enterprises that exhibit a profile of non-compliance, or making a concerted effort to enforce particular provisions of Part III [of the Canada Labour Code] that seem to be violated with unusual frequency. These submissions make good sense, and I accept them.[297]

The occupational health and safety regime has been identified as a system that places stronger emphasis on proactive enforcement activities than the ESA system.[298] In arguing for more proactive enforcement under the ESA regime, Vosko et al make the point that although it may seem reasonable to prioritize stronger protection for health and safety over employment protections which can be remedied through financial compensation, the differences should not be overstated, given the negative impacts on quality of life associated with prolonged precarious work.[299]

There appears to be widespread agreement that Ontario should shift its focus to concentrate more on proactive enforcement activities. We agree. However, the need will continue for a model that also responds to individual complaints.  

Compliance is likely to be secured through a range of strategies. Strategies should include information, education, persuasion and proactive monitoring – all designed to encourage compliance without coercion. But they should also include effective remedies and sanctions – administrative, civil and criminal – with gradations of severity. Sanctions should be used when non-coercive strategies fail to produce the desired results, especially in the case of egregious violations. Compliance strategies should operate proactively for the most part, rather than being invoked when violations have already occurred. And they should address root causes and patterns of persistent non-compliance as well as isolated violations.[300]

….Still, it is very difficult to turn away a complainant with a seemingly meritorious case.[301]

The Law Commission of Ontario recommends that:

10. The Ministry of Labour’s ESA enforcement continue to use a range of strategies including voluntary compliance, proactive inspections and responding to individual complaints. However, there should be greater emphasis on proactive enforcement processes.

 

2.     Specific Issues Arising from Current Enforcement

Approaching Employer Prior to Claim

As we have noted, the primary method of enforcement under the ESA’s current structure, the individual claims process, has been the subject of considerable negative commentary. The views of most academics and advocates are in line with Professor Eric Tucker’s comments: “most workers are unlikely to be assertive protagonists”.[302] In other words, vulnerable workers, in insecure employment, are not well-placed to make complaints. It has been suggested that the individual claims system is made more problematic by the fact that historically the Ministry of Labour has encouraged employees to attempt recovery of wages on their own.[303] Not surprisingly, workers’ advocates have taken a very dim view of the enactment of changes under the Open for Business Act that had the effect of imposing further obligations on many claimants before an investigation is commenced.[304] Pursuant to the amendments that took effect in January 2011, the Director of Employment Standards can require the complainant to take certain steps such as communicating with the employer about the violation, and providing information about the employer’s response. While not explicit in the legislation or the ESA Policy and Interpretation Manual, it is apparent from statements on their website that the Ministry of Labour has made a general policy decision to require all claimants to contact their employers about the violation unless a decision is made to waive the requirement.[305] The Ministry of Labour materials make clear that exceptions can be made for vulnerable workers such as live-in caregivers, youth, persons with disabilities, workers with language barriers, those who fear their employers, those with reasons relating to the Human Rights Code or those with other appropriate reasons.[306] Exceptions can also be made for such situations as when the claim is close to the six month limitation period or the employer cannot be located. These exceptions can be granted, upon request, presumably as an exercise of the Director’s (or delegate’s) discretion. It is unknown how frequently these exceptions are requested and/or granted. 

While the LCO did not hear of any instances in which the Ministry had declined to exercise its discretion in appropriate cases, it is apparent from the materials we reviewed that workers’ advocates believe that the process is a strong disincentive to workers making a claim. As a case in point, the Color of Poverty Campaign and Metro Chinese and Southeast Asian Legal Clinic supported the removal of all mandatory requirements for workers to attempt self-enforcement of ESA violations with employers prior to filing an ESA claim.[307] We are not clear whether advocates are basing their objections on actual situations where the Ministry failed to waive the requirement for vulnerable workers or whether they believe workers are simply discouraged at the outset from bringing claims by even the possibility of having to approach the employer. It is also possible that the Ministry’s willingness to waive the requirement for vulnerable workers is not well known among employee and worker-side stakeholders. While the Ministry of Labour website refers to the exceptions, elsewhere it is emphasized that most employees must approach employers. Online commentary and information about the ESA among stakeholders revealed that the exceptions are often not mentioned.[308] In any event, it may be that, as a matter of principle, advocates object to a requirement that workers request special protection as an exception rather than having it granted as of right. 

Whatever the specific basis for their objections, workers’ advocates have little confidence in the current system. The LCO was unable to determine whether there had been any impact on claims since the implementation of the Open for Business Act (OBA). Data available from the Ministry of Labour are not yet available for the relevant period. In our view, this issue is significant enough to warrant a review. Consistent with the findings of the Drummond Report recommending ministries improve data collection and engage in evidence-based policy development, we are of the view that an evaluation should be undertaken to assess the impact of the OBA changes with the goal of determining whether claims had declined during the post-OBA period and, if so, whether the policy change was the precipitating factor.[309] If so, this would justify reconsideration of the policy decision requiring, as a general rule, that employees approach their employers before embarking on an ESA claim.

The Law Commission of Ontario recommends that:

11. The Ministry of Labour:

a) engage in data collection and evaluation to determine the impact of the policy requiring employees to approach employers prior to initiating an ESA claim; and

b) consider reversal of policy if evaluation reveals negative impacts such as declines in claims attributable to the policy changes.

12. The Ministry of Labour improve communication about the vulnerable worker exemptions to approaching employers at the outset of an ESA claim.

Expediting and Facilitating ESA Claims

Lengthy time periods for resolution of ESA claims were identified as problematic in the consultations.[310] In an effort to improve, the Ministry of Labour launched a task force in August 2010 to deal with a backlog of 14,000 employment standards complaints. Completion was targeted for March 2012. This process has been criticized by some for encouraging workers to accept settlements for less than they are owed, a method that is viewed negatively by workers’ advocates.[311]

Person-to-person assistance for workers preparing their claims has been promoted as a means of increasing ESA accessibility and potentially expediting the claims-making process, thereby counteracting the effects of lack of internet access and/or language barriers. Appropriate claims information may ultimately assist adjudicators in the decision-making process.[312] A related proposition by Professor David Doorey envisioned the concept of one-stop shopping for employees seeking advice and assistance with ESA matters and a corresponding office for employers, or alternatively, a properly resourced office offering service to both.[313] Direct personal assistance could take the form of additional resources for legal aid clinics or government funded offices serving workers and employers functioning in a similar role to that played by the Office of the Worker Advisor and the Office of the Employer Advisor in workplace safety and insurance matters. However the service is structured, it would be important to provide workers with assistance in asserting their claims and to employers in responding, ensuring that the requisite information, in the proper format, is submitted to the Ministry. Properly documented claims and responses would work to expedite and improve the quality of the claims process. As Professor Doorey highlights, support for employers is also important. In our view, small enterprises could particularly benefit from this service. 

The Law Commission of Ontario recommends that:

13. The Ontario government facilitate and expedite the ESA claims-making process, by providing a mechanism for workers and employers to obtain person-to-person assistance in the claims process through additional support services such as Legal Aid Ontario clinics, Office of the Employment Standards Advisor and/or other types of worker and employer support services.

Limitation Period and Monetary Cap

Section 111 of the ESA sets out a six month limitation period for bringing claims related to wages. The limitation periods for recovery of wages are longer for cases of repeat violations and for recovery of vacation pay. For contraventions where reinstatement/compensation are sought as a remedy, the general limitation period is two years under s.96(3). The mandatory time limits may be extended in exceptional cases of fraudulent concealment where the employee has been misled.[314] The ESA also imposes a monetary cap of $10,000.

The shorter limitation period for recovery of wages may expedite the bringing of claims which could have benefits for all parties. Earlier claims are likely to be easier to investigate. Employers benefit from having claims outstanding on their books for a much shorter term. But claimants who delay have no recourse under the ESA and are left to seek relief in the civil courts. Many will be unable to navigate the small claims court process. Furthermore, as others have observed, most claims are made after workers leave the job and some workers leave jobs being owed “substantial amounts of unpaid wages and entitlements. However, the $10,000 cap on monies recoverable under the ESA leaves these workers without remedy through the [employment standards] claim process.”[315] “Job dislocation and difficulties learning how to pursue ES rights” make the six month limitation period a significant obstacle to accessing ESA protections.[316]

These obstacles coupled with recent increases in minimum wages suggest justification for expanding the ESA’s six month limitation period to two years for recovery of wages and increasing the monetary cap to $25,000.[317] This would bring the ESA cap in line with the small claims court cap. In our view, there does not appear to be a sufficiently strong justification for capping the ESA at a lower rate than the small claims court cap and for imposing shorter limitation periods on recovery of wages than for vacation pay or other ESA remedies. Providing for a two-year limitation period for all claims would create consistency with other limitation periods within the Act and would respond appropriately to concerns about obstacles faced by workers due to the limitation caps.

The Law Commission of Ontario recommends that:

14. The Ontario government:

a) expand time limitations to two years for all ESA remedies; and

b) raise the ESA monetary cap to $25,000.

 

Third Party and Anonymous Complaints

Hardly any nonunion employees file ESA complaints. The ESA enforcement mechanisms are used almost exclusively by unionized employees who can file grievances under a collective agreement and by former employees, who have been dismissed by their employer or who have quit.[318]  

The Auditor General made a similar point.[319] This is evidence of a system that does not meet the needs of protecting workers while they are still employed. As a partial remedy, it has been proposed that the Ministry of Labour accept third-party and anonymous complaints 

to initiate inspections in order to minimize threats to workers whose rights are being violated. Implementing this recommendation would mean that the most precariously employed workers, facing heightened threats of reprisal, are not obliged to take on their employers….[320] 

We agree. We believe it desirable that the Ministry of Labour arrange for a mechanism to accept third party information. Such information could be used as a basis to determine where proactive inspections should be targeted. Accepting third party or anonymous complaints would also be one way to respond to the many serious concerns we have heard regarding reprisals. Any system developed would require built-in checks and balances to ensure that unfounded complaints did not trigger costly and unwarranted inspections. It would be important to develop policy criteria for determining whether information supplied by third parties either on its own or together with other information available to the inspectors was a sufficient foundation to warrant launching an inspection. 

The Law Commission of Ontario recommends that:

15. The Ministry of Labour:

a) develop a mechanism – such as a hotline – for ESOs to receive third-party and/or anonymous complaints which could trigger proactive inspections; and

b) develop corresponding policy criteria to ensure that unfounded complaints did not trigger unwarranted inspections.

 

Reporting on ESA enforcement practices in 2004, the Auditor General expressed concern that the Ministry of Labour was focusing its efforts almost entirely on investigating individual complaints against former employers even though previous proactive inspections had uncovered violations in 40% to 90% of cases. As mentioned earlier, this concern has been echoed by others.[321] The Auditor General found there had been no significant improvements since a 1991 audit had revealed deficiencies in investigations, proactive inspections and prosecutions. The 2004 Report recommended increased proactive inspections, improved guidance to ESOs on enforcement and that the Ministry assess the impact of making employers pay for investigations when violations are found. In its follow-up 2006 Report, the Auditor General found progress in some areas but found no implementation of the recommendation that non-compliant employers pay for inspections. However, the Ministry committed to consider this change in future legislative reviews. The Auditor General noted that the Ministry of Labour had increased proactive inspections from 151 in 2003-2004 to 2,355 in 2004-2005 and 2,560 in 2005-2006. The Auditor General considered these to be the new benchmarks “upon which to establish future targets”.[322] However, these inspections have since dropped to fewer than half that amount. There were only 1,093 for 2010-2011.[323] The Ministry of Labour currently indicates:

  • The Dedicated Enforcement Team will conduct a minimum of 1800 proactive inspections in 2011-12 (up from 1100 in 2010-2011) and will focus on repeat violators and high risk sectors for vulnerable workers.
  • As the ES Program moves into a more proactive compliance model, the ES Program will consult with stakeholders about our inspection activities and sector plans.[324]

The prioritization of high-risk industries with vulnerable workers has been recommended in workplaces where intervention will have a high impact and deterrence will take effect.[325] Enforcement sweeps and educational campaigns are supported, targeting “fissured” industries where decisions are downloaded from major employers to a complex network of smaller employers such as are found in the hospitality, janitorial, construction and agricultural sectors.[326] 

As mentioned, it would be effective for the Ministry of Labour to ensure that the disproportionate representation of vulnerable workers in certain industries and groups are considered in identifying areas for targeting increased proactive inspections. For example, our consultations revealed reports of temporary foreign workers being regularly required to work late and on weekends without receiving either overtime or vacation pay. In some instances, migrant workers who worked alongside Canadian workers reported that the Canadian workers were rarely asked to work overtime and, we were advised, they were generally treated better. We heard of instances where migrant workers’ attempts to raise such concerns with employers resulted in employers’ retaliation by insisting they work additional hours with the threat of termination if they refused. We heard accounts of sexual abuse of women employees in the workplace.[327] 

The 1991 audit specifically identified the lack of expanded investigations as a major issue. It noted that when violations were detected, the investigation was not extended to determine whether other employees had experienced similar violations. In its 2004 report, the Auditor General found no significant increase in the number of expanded investigations for confirmed violations. 

To be effective in fulfilling its mandate, the Ministry has an obligation to protect the employment rights of currently employed workers who may be reluctant to file claims. 

Greater ministry emphasis on extending investigations of a substantiated claim to cover other employees of the same employer to determine whether additional violations had taken place would be an effective means of enforcing the employment standards legislation.[328]

However, as of 2006, there had been no significant improvements in the number of expanded investigations conducted by the Ministry.[329] We are not aware of any significant improvement since that time. 

The Law Commission of Ontario recommends that:

16. The Ministry of Labour:

a) substantially increase proactive inspections particularly in higher risk industries based on established benchmarks;

b) develop strategic, proactive enforcement initiatives that target high-risk for violation workplaces, including those comprised of concentrations of temporary foreign workers, temporary agency workers, recent immigrants, racialized workers, youth, the disabled and Aboriginal people, as well as areas known for high-rates of substandard practices;

c) conduct expanded investigations when violations are detected; and

d) ensure enforcement activities include follow-up on previous violations.

17. The Ontario government consider amending the ESA to allow for orders requiring employers found in violation of the ESA to cover the costs of investigations and inspections.

 

3.     Penalties

There are a variety of sanctions that may be engaged to respond to ESA violations. They include orders to pay wages, orders for compensation, compliance orders, notice of contravention and prosecution. Employment Standards Officers have the discretion to use or not use the above options.[330]

The Auditor General noted that in the five years leading up to 2004, there had been only 63 convictions under the ESA. Prosecutions were not commenced even when the amounts owing were high. In its 2004 Report, the Auditor General recommended that the Ministry of Labour provide better direction to employment standards officers regarding the appropriate use of enforcement measures, including notices of contravention and prosecutions, and better monitor the use of these measures for consistency of application. After the Auditor General’s Report, prosecutions reached a high of 594 in 2006-2007 and 505 in 2008-2009 but dropped to 196 in 2010-2011, only 4 of which were prosecutions under Part III of the Provincial Offences Act resulting in more serious fines.[331] The prosecutions are overwhelmingly of the Part I type, resulting in fines of $360.00 or less.[332] Workers’ advocates are of the view that “tickets are not an effective cost for violations in the first place, nor will they act as a deterrent to ongoing or future violations.”[333]

Commentators agree that the system must have and utilize effective penalties and sanctions.[334] Some observers promote stronger policy or legislative standards with less discretion placed in the hands of ESOs.[335] Other suggestions include set legislated fines for confirmed violations even in the settlement process and increased prosecutions. In general, the consultations revealed dissatisfaction with the existing use of penalties that were considered to be ineffective at deterring non-compliant employers. Advocates do not support the current widespread use of tickets under Part I of the POA which are perceived as providing inadequate incentives to compliance. Instead, they advocate for fines that double or triple the amount owed and for the payment of interest on all unpaid wages, a power which ESOs currently do not have. Advocates consider the 10% administrative fee levied on orders to pay wages to be an insufficient motivation for non-compliant employers to repay wages. [336] 

The LCO agrees that effective sanctions must be utilized to achieve compliance. The 196 prosecutions in 2010-2011 resulted from approximately 17,000 complaints.[337] The ESA Policy and Interpretation Manual that is directed at ESOs, lawyers, human resource professionals and others explains the legislation and case law. This manual, however, provides very little specific policy direction to ESOs in terms of use of the various sanctions. While, on the one hand, ESOs must have flexibility to be able to respond appropriately to the myriad of individual circumstances they encounter, they also need clear policy direction on when to initiate prosecutions, particularly where deterrence is required in the case of repeat offenders and wilful non-compliance with payment orders. Some commentators have called for mandatory prosecution policies. We do not agree. Such policies can have unanticipated negative consequences by injecting unnecessary rigidity into the system. We do, however, believe that ESOs should be provided with specific policy direction and education emphasizing deterrence in selecting penalties and sanctions, particularly for repeat violations and wilful non-compliance.

The Law Commission of Ontario recommends that:

18. The Ministry of Labour strengthen ESO policy direction with supporting education to emphasize deterrence in terms of prosecution, penalties and sanctions for repeat violators and those who wilfully fail to comply with payment orders.

 

4.     Resources

In the long-run, better front-end enforcement may work to decrease individual claims by increasing compliance. In the meantime, increased proactive enforcement will require resources. However, this raises the question, as others have noted, about the adequacy of funding for Ontario’s ESA enforcement.[338] The majority of resources continue to be devoted to responding to individual complaints rather than compliance or proactive activities. Ontario’s 2011 budget indicated, 

…[S]ince 2009, the government has invested 4.5 million annually to increase the number of employment standards officers in the province. The government has also invested an additional $6 million over two years to help reduce the backlog of employment standards claims and improve the protection of Ontario’s employees, thereby reducing hardship for workers and their families.[339]  

According to the Ministry of Labour, more resources will be shifted to inspections once the backlog is dealt with, which was anticipated to have been completed by March 2012.[340] However, the $6 million in backlog funding to employ more employment standards officers was provided for a specified two year period that ended in March 2012. This raises questions about the extent to which adequate resources will be available going forward for effective proactive inspections and other enforcement activities. 

The Law Commission of Ontario recommends that:

19. The Ontario government ensure adequate resources for ESA compliance and enforcement, with a particular emphasis on proactive enforcement.

E.     Mechanisms to Support Compliance and Enforcement

1.     Employee Voice and Participation

Professor Anil Verma argues that “employee voice can be a powerful tool in ensuring better labour standards.”[341] Other commentators agree. Building upon this concept, the LCO has considered ways to increase ESA awareness and compliance by way of improved “employee voice” through joint employee-employer work councils. This framework exists in Ontario under the Occupational Health and Safety Act in the form of the joint health and safety committee scheme.[342] Importing such a system into the ESA could be beneficial for enhancing compliance particularly in non-unionized workplaces populated by low wage workers.

Roy Adams proposes implementing the German model of employee work councils.[343] Under the German model, work councils are a mandatory, elected body in German workplaces with five or more employees. The council has legislated rights regarding consultation, information and participation. Participation rights, referred to as co-determination, allow for joint decision-making jurisdiction over a wide variety of issues, including hours, occupational health and safety, training, job classification, and individual and mass dismissals. Work councils co-exist with unions.[344] Unless approved by the collective agreement, work councils do not engage in bargaining over wages.[345] Adams suggests this model is considered successful by both management and unions; he offers its resilience following economic downturns in the 1980s and 1990s as a marker of this success.[346] In his 2006 paper, Professor Verma noted that while the European Union had used this model to design various measures to increase worker participation, the German government had been evaluating the work council system in the face of increased international competition and has made legislative changes to adapt it to changing circumstances.[347] In many cases, the changes have strengthened the system. The election procedure was simplified, work councils could now be set up for more types of business relationships such as joint work councils operating across related businesses, or divisional councils could be created for specific products or business types. The scope of council activities has been increased and equity and discrimination policies have been introduced. Professor Verma concluded that “work councils were not perfect vehicles for dealing with the pressures of globalization” nor could there be a wholesale transfer of the German model to the Canadian workplace. However, he noted the value of the principles upon which work councils are founded for joint workplace decision-making.[348]

Building upon this concept, it would be possible to create a model for work councils in the Ontario workplace aimed at increasing employee participation and knowledge, for initiating discussions between employers and employees on ESA matters and potentially for resolving disputes. If effectively implemented, the existence of the council would work to reduce worker isolation by creating a system of support and representation in the workplace. ESOs could rely on the work council as a source of information during investigations and/or inspections. The introduction of work councils would necessitate the training of employee and employer representatives. This alone could benefit the workplace through increased knowledge. Establishing ESA work councils could be facilitated by “piggy backing” onto the existing structure of OHSA joint committees.  

Project Advisory Group members had a mixed reaction to the general idea of introducing work councils and specifically, to utilizing the existing OHSA scheme for their implementation. Some members representing labour interests indicated that OHSA committees are not operative or effective in many workplaces, while employer members noted that health and safety committees work well in non-unionized environments and that most employees do not operate in a state of fear of the employer. However, they raised concerns about the costs of such councils. Some members of the Project Advisory Group representing labour interests were of the view that introducing a work council scheme into non-unionized workplaces could create issues of intimidation and reprisal. However, they suggested that these could be addressed with well-enforced, anti-reprisal processes. 

In our view, work councils present an opportunity to introduce a beneficial mechanism that is adaptable to the changing nature of the modern workplace. To test their effectiveness, we propose the implementation of an ESA work council pilot project. We suggest the model would be most beneficial in the non-unionized workplace in a sector with high concentrations of vulnerable workers. Implementation through a partnership of government, employers and employees would increase the likelihood of a successful pilot and province-wide expansion into non-unionized workplaces. 

The Law Commission of Ontario recommends that:

20. The Ministry of Labour:

a) implement a joint labour-management employment standards work council as a pilot in a number of select non-unionized workplaces with high concentrations of vulnerable workers;

b) evaluate the pilot; and

c) if successful, implement ESA work councils in non-unionized workplaces.

2.     Focusing on the Top Echelon of Industry

David Weil’s 2010 report on Strategic Enforcement to the U.S Department of Labor’s Wage and Hour Division recognized that, because of the extreme effects of competition, companies were shifting away from direct employment to subcontracting, use of temporary workers and temporary agency workers, resulting in a weakening of the impact of traditional approaches to enforcement. This “fissuring” of employment by using external workers, in Weil’s view, requires a response directed at “higher levels of industry structures in order to change behaviour at lower levels, where violations are most likely to occur.”[349] The report supports a coordinated approach to strategic enforcement, identifying and prioritizing workplaces with high concentrations of vulnerable workers, who are unlikely to complain, and in sectors where employer behaviours are likely to be changed. One strategy discussed is government reaching out to the top echelons of the industry or company through non-confrontational communications highlighting the government’s commitment to employment standards and the important role played by the top level of industry. 

Weil’s report proposes targeting branded companies to encourage leadership within their fields for employment standards compliance. Such companies rely on their “brand” to create a unique product with a loyal client base willing to pay a premium for the brand. Good image is important to branded companies and governments can leverage this interest in maintaining a good image to encourage companies to act as leaders within their branded field by prioritizing employment standards compliance for external workers affiliated with their company. Leading employers could be featured in public campaigns and provided with additional incentives through forms of special recognition. Furthermore, among such companies, publicising the results of compliance or non-compliance would provide a significant incentive to comply among competing companies and brands within the sector.  

Weil’s report proposes the coordination of enforcement activities among branches or franchises of a branded company. In situations where violations are detected, Weil recommends that part of the resolution could involve a comprehensive agreement covering all outlets/branches of a particular company. Communications about enforcement targets and resolutions such as the above could be made highly visible within industries that employ vulnerable workers. In this way, pressure to comply could be brought to bear on supply chains. To be effective, deterrent penalties would be required when violations are detected.[350] Other ways to engage supply chains are discussed under the Chapter on Health and Safety.

The Law Commission of Ontario recommends that:

21. The Ministry of Labour:

a) explore processes of reaching out to and focusing on the top echelon of industry to address ESA non-compliance among workers affiliated with the company particularly those subcontracted to small enterprises and temporary agency workers; and

b) identify and provide recognition and incentives for companies that are leaders in extending employment standards compliance to external workers particularly those subcontracted to small enterprises and temporary agency workers.

 

3.     Responding to Temporary Foreign Workers: Fear of Repatriation

Temporary foreign workers have specific concerns due to the fact that their ability to work in Canada is often directly tied to an individual employer. If an employee is terminated, some temporary foreign worker programs allow for the employee to find other employment within a specified period, although there are significant limitations on their ability to transfer. The SAWP contract provides for repatriation when the employer, in consultation with the government agent, terminates the employment based on non-compliance, refusal to work or any other sufficient reason. While there are processes in place to avoid early termination (described below in more detail), when and if these processes fail, SAWP workers must return immediately to their home countries. Reports and studies from researchers, academics and advocates have found that concerns about termination, repatriation or non-contract renewal can act as an effective disincentive for workers to access legal remedies intended to protect such workers.[351] Repatriation need not be expressly threatened by the employer, it can be implicit in the conduct of employers. Or, the fear arises simply from the migrant workers’ temporary status; workers know they can be sent home or not asked back. This, we were told, effectively mutes any worker’s complaints about breaches of employment standards, health and safety legislation or housing standards.[352]

If repatriation is achieved without an opportunity for an appeal or independent review, it effectively denies the worker avenues of legal redress available under Ontario law, such as seeking protection from the anti-reprisal provisions found in the ESA.[353] When workers are no longer in Ontario, it is difficult to exercise these legal rights. 

Concerns about repatriation were also raised in the Dean Report in its review of Occupational Health and Safety.[354] In response, the Report recommended expediting the hearing of reprisal complaints at the Ontario Labour Relations Board which could order interim reinstatement. This is being accomplished through recent legislative changes to the OHSA. In our view, a similar process should be made available in the context of the Employment Standards Act. This would assist all workers facing reprisal but most particularly temporary foreign workers whose vulnerability is more acute. 

While the process of “naming” in SAWP can have benefits for workers and employers, it also can serve to create concern among employees that they will not be “named” by the employer to return to Canada the next year or that they will be refused by their home country’s Ministry of Labour. Workers indicated that with the availability of agricultural labourers through the NOC C and D Pilot Project, there is another pool of workers who can replace an existing SAWP worker.

Despite concerns about repatriation, rates of actual termination of SAWP workers are not high. Of the approximately 15,000 SAWP workers in each of 2009 and 2010, F.A.R.M.S. advised that only 73 and 120 respectively were repatriated for breach of contract and for all reasons only about .5% are repatriated.[355] Therefore, F.A.R.M.S. and liaison officers did not perceive termination as a tool used by SAWP employers to exercise undue control over workers. Furthermore, they considered termination as an avenue of last resort. Before termination is exercised, we were advised that employers will often try to resolve issues directly with workers. Where that is unsuccessful, employers will often contact F.A.R.M.S., who will work with the employer and liaison officer to seek to resolve the issue or to negotiate a transfer of the worker to another employer (with the approval of Human Resources and Skills Development Canada [HRSDC]). However, we were advised that transfers did not occur frequently.[356] F.A.R.M.S. noted that termination has negative consequences for employers in terms of administrative costs, travel and other costs to hire a SAWP worker and they emphasized the role of liaison officers in resolving workers’ issues.[357] Liaison Services supported these views advising that termination and repatriation, at will by the employer, does not occur. Under the employment contract, the Liaison Officer must be consulted before termination occurs and, where an employer is acting unreasonably, F.A.R.M.S. will intercede and discuss the matter with the employer. It is also possible that workers will no longer be made available to that employer, although this has occurred only rarely.

Even though there appear to be clear mechanisms in place under SAWP to minimize terminations and rates of termination are very low, our consultations and research nevertheless revealed significant concerns about job loss and repatriation among these workers.[358] It is the fear itself that has been identified in the research as the primary barrier to workers asserting their rights, making them vulnerable to exploitation by non-compliant employers.[359] Compared to SAWP, NOC C and D workers may have slightly more mobility in that they are eligible to initiate job transfers if they can find another eligible employer who is willing and able to obtain a labour market opinion (LMO) and engage successfully in the process for hiring a temporary foreign worker. 

In our view, the most effective response to workers’ fear of repatriation would be to formalize a process of independent decision-making prior to repatriation. Given that actual instances of termination occur infrequently under SAWP, such a process should not create a significant challenge for SAWP employers. Since repatriation statistics do not appear to be readily available for the NOC C and D program, it is not known to what extent it occurs under this program, but, clearly, this type of process could be beneficial for these employees who lack the processes and oversight of the SAWP program and are therefore likely most in need of protections. Moreover, the implementation of an added level of oversight may be a way to improve confidence and reduce fear among temporary foreign workers. In our view, an independent decision-making body made up of Ministry of Labour and/or HRSDC representatives and worker and employer representatives would help to ensure that repatriation is not being utilized as a reprisal for workers attempting to access their rights or is otherwise unjustified. Such a process is particularly important for NOC C and D workers.

While we support interim reinstatement provisions for appropriate circumstances, we recognize there are challenges in a process that puts employers and employees back into a relationship that is no longer workable for one or both.[360]

The Law Commission of Ontario recommends that:

22. The Ontario government amend the ESA to include a process for expediting complaints of reprisals and, in the case of migrant workers, ensure that such complaints are heard before repatriation.

23. In coordination with the federal government, the Ontario government:

a) institute a process for independent decision-making to review decisions to repatriate temporary foreign workers prior to the repatriation to ensure dismissal is not a reprisal for accessing workers’ rights under federal or provincial legislation or contract;

b) for reprisals, the independent-decision making body have the authority to order interim reinstatement for appropriate circumstances pending decisions and appeals; and

c) where there is a finding of reprisal, provision be made for transfer to another employer or, where appropriate, reinstatement.

 

Agencies that provide legal service to temporary migrant workers should be fostered. An independent decision-making process prior to repatriation, as described above, would be an area where legal representation could play a valuable role. In general, availability of legal and other support for workers could increase knowledge of and access to workers rights for temporary foreign workers and other vulnerable workers. In our consultations, we met with several organizations and became aware of others that provide support, assistance, advocacy and outreach to migrant workers.[361] For example, the Agricultural Workers Alliance (AWA) Support Centres operate four centres in Bradford, Leamington, Simcoe and Virgil and are ventures of the United Food and Commercial Workers Union and the Agricultural Workers Alliance. These centres provide direct or referred assistance to migrant farm workers dealing with repatriation concerns and claims for workers’ compensation, parental leave benefits, Canada Pension Plan, Employment Insurance and health insurance.[362] In the Niagara Region, Community Legal Services of Niagara South has partnered with the Niagara Migrant Workers Interest Group, a group of community organizations and volunteers, to provide legal and other supports to migrant workers. We met with organizations that support live-in caregivers such as the Caregivers Action Centre. For non-agricultural NOC C and D workers, we heard of several incidents in which the legal clinics had played a crucial role in providing support.

The Law Commission of Ontario recommends that:

24. The Ontario government support the establishment of greater legal and other supports for temporary migrant workers asserting rights and making claims through expanded legal services or other such mechanisms.

25. Unions and community groups continue to develop and expand innovative services to support migrant workers to assert their legal rights and make claims.

 

4.     Enforcing Vulnerable Workers Rights through Association

Many commentators are of the view that one of the most effective means of reducing worker vulnerability and enforcing workers’ rights is through unionization. Unionization’s benefits have been described as important social values, related to workers’ well-being and providing a forum for airing grievances.[363] The Supreme Court of Canada has noted that:

It is widely accepted that labour relations laws function not only to provide a forum for airing specific grievances, but for fostering dialogue in an otherwise adversarial workplace. As P. Weiler has written, unionization introduces a form of political democracy into the workplace, subjecting employer and employee alike to the “rule of law”.[364]

Despite unionization’s benefits for workers, unions have never been a panacea. Even at the height of unionization in Canada, only about 35% of Ontario workers were unionized.[365] While many workers’ advocates are pressing for increased unionization as the remedy to precarious work, the prospect of increased unionization may be out of step with global trends. Unions themselves are assessing their appropriate role in today’s and the future’s economic and social conditions.[366] Ontario, in common with much of the industrialized world, is experiencing a gradual decline in unionization rates.[367] While Canadian unions remain strong relative to the United States and, in fact, in absolute numbers, union membership is increasing in Canada, union density (the percentage of the Canadian workforce that is unionized) decreased between 1997 and 2010 from 33.7% to 31.5%.[368] And among Canadian jurisdictions, Ontario had the second lowest unionization rate, at 27.9%, in 2010.[369] Interestingly, while national rates for men have declined over the past decade, women’s unionization rates have increased to 32.7% beyond the national average. This tracks a trend starting in 2006 when unionization rates for women first surpassed that of men.[370]

As 2010 data indicate, unionization rates are much higher in the public sector (74.9%) as compared to the private sector (17.5%).[371] Private sector rates in Canada have declined over the past decade from approximately 19.9% in 2001.[372]

The declines that have occurred have been attributed to the radical economic, technological and social changes that have taken place over the past 30 years.[373] Competitive pressures brought about by globalization, free trade and economic downturns diminish the bargaining power of unions, and in an environment of financial insecurity, workers are less willing to organize. The decline of the manufacturing industry has also been an important contributing factor in Ontario. It is significant that the role of most unions in Canada has traditionally been a narrow one, focused on bargaining for wages, job security and working conditions in the immediate workplace rather than on broader issues of training, hiring and career development.[374] With the rise of precarious and non-standard forms of work, this model is in decline. The Wagnerian collective bargaining model adopted in the Ontario Labour Relations Act (LRA) was developed in the context of a traditional workplace with one employer and many employees carrying out standardized skills in a single workplace, a scenario which is becoming ever less common in the modern economy.[375] 

Commentators have suggested that unions must adopt a broader focus that is responsive to the unique needs of workers in non-standard employment relationships.[376] The issue of unionization is always a highly politicized one, but it is particularly delicate in this period of economic uncertainty. On the other hand, others argue that “union membership is central to limiting precarious employment.”[377]

One area where the debate about vulnerable workers has been centered is the express exclusion of agricultural workers from Ontario’s traditional labour relations regime. A 1992 Task Force considering the issue of extending collective bargaining rights to agricultural workers looked to other jurisdictions and observed that providing agricultural workers with the right to bargain collectively had not resulted in organizing to any significant degree nor did it have an undue negative impact on farms in those jurisdictions.[378] The Task Force proposed a collective bargaining regime that included provision for an exclusive bargaining unit and a collective bargaining process that emphasized negotiation and prohibited strikes, but provided for binding arbitration in the event of an impasse. This model was adopted in the Agricultural Labour Relations Act, 1994 (ALRA). It should be noted that the ALRA excluded from its scope the most vulnerable agricultural workers in Ontario – temporary foreign workers and other seasonal workers.[379] The ALRA was short-lived, being repealed by the newly elected government in 1995. In response to the repeal, the United Food and Commercial Workers (UFCW) and individual agricultural workers in Dunmore et al. v. Ontario (Attorney General) challenged the exclusion of agricultural workers from the labour relations scheme as a violation of their freedom of association and equality rights as guaranteed in the Canadian Charter of Rights and Freedoms.[380]  

In Dunmore, the Supreme Court of Canada recognized the particular vulnerability of agricultural workers. 

Distinguishing features of agricultural workers are their political impotence, their lack of resources to associate without state protection and their vulnerability to reprisal by their employers; as noted by Sharpe J. [at trial], agricultural workers are “poorly paid, face difficult working conditions, have low levels of skill and education, low status and limited employment mobility”.[381]

On the other hand, the Court also acknowledged the threat that unionization posed to the family farm in Ontario: 

…[t]he Attorney General has demonstrated that unionization involving the right to collective bargaining and to strike can, in certain circumstances, function to antagonize the family farm dynamic. The reality of unionization is that it leads to formalized labour-management relationships and gives rise to a relatively formal process of negotiation and dispute resolution; indeed, this may be its principal advantage over a system of informal industrial relations. In this context, it is reasonable to speculate that unionization will threaten the flexibility and cooperation that are characteristic of the family farm and distance parties who are otherwise … ‘interwoven into the fabric of private life’ on the farm.[382]

…I am satisfied both that many farms in Ontario are family-owned and operated, and that the protection of the family farm is a pressing enough objective to warrant infringement of s. 2(d) of the Charter. The fact that Ontario is moving increasingly towards corporate farming and agri-businesses does not, in my view, diminish the importance of protecting the unique characteristics of the family farm; on the contrary, it may even augment it. Perhaps, more importantly, the appellants do not deny that the protection of the family farm is, at least in theory, an admirable objective.[383]

But where the employment relationship between farmer and workers was already formalized, the Court noted that “preserving ‘flexibility and co-operation’ in the name of the family farm is not only irrational, it is highly coercive.”[384]

On the issue of the economic fragility of Ontario’s farming industry, the Court noted: 

I disagree with the appellants that the ‘Government has provided no evidence that the Ontario agricultural sector is in a fragile competitive position or that it is likely to be substantially affected by small changes in the cost and operating structure of Ontario farming.’[385] 

The Court apparently accepted the Ministry of the Attorney General’s submission that 

agriculture occupies a volatile and highly competitive part of the private sector economy, that it experiences disproportionately thin profit margins and that its seasonal character makes it particularly vulnerable to strikes and lockouts…these characteristics were readily accepted by the Task Force leading to the adoption of the ALRA.[386]

However, the Court in Dunmore noted that this same rationale could be extended to many industrial sectors that experience thin profit margins and unstable production cycles (due to consumer demand or international competition, for example).[387]  

In Dunmore, the Court held that “the total exclusion of agricultural workers from the LRA violates s. 2(d) of the Charter and cannot be justified under s. 1.”[388] It should be noted that only the right to associate and not the right to collective bargain was at issue in Dunmore. [389] The Court went on to hold 

at minimum the statutory freedom to organize in s. 5 of the LRA ought to be extended to agricultural workers, along with protections judged essential to its meaningful exercise, such as freedom to assemble, to participate in the lawful activities of the association and to make representations, and the right to be free from interference, coercion and discrimination in the exercise of these freedoms.[390] 

In response to the Dunmore decision, Ontario introduced the Agricultural Employees Protection Act, 2002 (“AEPA”), an alternative legislative scheme. The AEPA was enacted to

…protect the rights of agricultural employees while having regard to the unique characteristics of agriculture, including but which is not limited to, its seasonal nature, its sensitivity to time and climate, the perishability of agricultural products and the need to protect animal and plant life.[391] 

Under the AEPA, agricultural workers have the right to join an employees’ association and to make representations to their employers through the association, respecting the terms and conditions of their employment. They also have the right to protection against interference, coercion and discrimination in the exercise of their rights.[392] The AEPA utilizes the Agriculture, Food and Rural Affairs Appeal Tribunal to rule on disputes over the application of the Act.[393] 

The AEPA does not provide for majority representation, a limit on the number of associations that may represent a particular segment of the workforce, the right to strike or arbitration. In short, it provides for the formation of employee associations but does not provide the full Wagner model labour relations process available under the LRA. As a result, the UFCW and three agricultural workers challenged the constitutionality of the AEPA in Fraser v. Attorney General of Ontario.[394]

In Fraser, the Supreme Court reviewed in general terms the meaning of its previous holding in Health Services and Support – Facilities Subsector Bargaining Assn. v. British Columbia[395] It affirmed that s.2(d) protects “good faith bargaining on important workplace issues …not limited to a mere right to make representations to one’s employer, but requires the employer to engage in a process of consideration and discussion to have them considered by the employer.”[396]  

Fraser went on to say that Health Services represented the view that the good faith negotiations required by s.2(d) constituted a requirement for “the parties to meet and engage in meaningful dialogue”, avoid unnecessary delays and make reasonable efforts “to arrive at an acceptable contract”. It did not “require the parties to conclude an agreement or accept any particular terms”, nor did it “guarantee a legislated dispute resolution mechanism in the case of an impasse”. Section 2(d) protected the right to a general process of collective bargaining but not to a particular model.[397]

Fraser went on to hold that the AEPA was constitutional by finding that “properly interpreted”, the Act imposed “a duty on agricultural employers to consider employee representations in good faith.”[398] The Court found that the AEPA was not intended to deny agricultural workers collective bargaining rights within the meaning of s.2(d), but only that the AEPA did not extend Wagner model collective bargaining to farm workers.  

These considerations lead us to conclude that s.5 of the AEPA, correctly interpreted, protects not only the right of employees to make submissions to employers on workplace matters, but also the right to have those submissions considered in good faith by the employer. [399]

The majority concluded: “The bottom line may be simply stated: Farm workers in Ontario are entitled to meaningful processes by which they can pursue workplace goals.”[400]      

This decision has been highly criticized by those in the labour movement who contend that it did not take into account the social reality and unique vulnerabilities of agricultural workers. In particular, the Court’s statement that s.2(d) must provide a process that allows for “the right of an employees’ association to make representations to the employer and have its views considered in good faith” is viewed as a retreat from the emphasis in Health Services on a duty of good faith bargaining to “a much paler right to ‘good faith consideration’”.[401] This is viewed by workers’ advocates as wholly inadequate, unworkable and unrealistic. From their perspective, agricultural workers are so vulnerable that nothing short of statutory protection for the full labour relations scheme as provided in the LRA will be effective.  

Post-Fraser, the debate continues unabated as to what is required to meet the needs of farm workers balanced against Ontario’s agricultural industry. Given the reaction to Fraser, it seems unlikely that a consensus position among the various stakeholders will emerge in the near future. Through the course of the decisions, however, certain matters have become accepted facts by the Court. The vulnerability of agricultural workers and their need for labour relations protection in some form has been recognized. The Court in Dunmore also recognized the economic tenuousness of the agricultural industry, the legitimacy of the interest in protecting the family farm and the mix of family businesses and large agri-businesses that comprise Ontario farms. This type of evidence was also before the Court in Fraser. Other than adopting its position in Dunmore on the vulnerability of agricultural workers, the Supreme Court in Fraser appeared to prefer to leave the balancing of these various interests to legislature.  

Beyond Fraser, should there be government appetite to revisit the issue and to implement feasible law reform in this area, in view of the challenges and balancing of interests required to make major policy changes, it might be helpful if an expert panel were assigned to undertake an analysis of the case law, relevant literature and evidence presented to the courts and broad consultation with relevant labour and management stakeholders as well as affected ministries. Such an undertaking is beyond the capacity and scope of this Project. 

In the immediate term, the AEPA should be reconsidered in light of Fraser. As noted, the Court in Fraser in affirming Health Services used language such as “good faith negotiations” to describe s.2(d) protections and later in the decision when applying the facts specifically to the AEPA, referred to “good faith consideration of employee representations.” While some observers view this as a partial retraction of the s.2(d) protections articulated in Health Services, such an interpretation is not explicit in Fraser. Rather, the Court in Fraser affirms the Health Services ratio that s.2(d) protects “good faith negotiations”. The Court makes explicit that this includes the “right to make representations to one’s employer” and a duty on agricultural employers to consider employee representations in good faith, including the requirement that the employer “engage in a process of consideration and discussion” in relation to those representations.[402] Parties must “meet and engage in meaningful dialogue”. They must “avoid unnecessary delays and make a reasonable effort to arrive at an acceptable contract”.[403] In our view, these elements have been expressly identified as protected by s.2(d) in both Fraser and Health Services.  

The majority in Fraser noted the union’s lack of utilization of the AEPA. As Justice Farley noted at the trial level:

There has been no use of the mechanics of the AEPA as to bringing a case before the Tribunal; the Applicants stated that it would be fruitless to bring a useless application before a useless Tribunal. I am of the view that this condemnation is premature. A successful application would do one of several things: be effective positively as to action; or morally give the wrongdoing employer a “bloody nose”; or if truly an empty process it would demonstrate the need for strengthening by legislative amendment.[404]

While the AEPA does not provide for union certification or majoritarianism, nothing in the legislation prevents unions from assisting workers to form employee associations. In our view, agricultural workers could benefit from union support for the AEPA employee associations. While this may not be satisfactory to unions and workers’ advocates because they might believe this would impede the development of a fully realized collective bargaining regime, there does not appear to be a significant likelihood of achieving this objective in the near future. The role unions could play in assisting workers to access the rights articulated in the AEPA as interpreted by Fraser would be highly beneficial for these workers. Unions could also play an important role in assisting workers to utilize the Tribunal in appropriate cases particularly in view of the elements of good faith bargaining now read into the AEPA. The Supreme Court in Fraser supported Justice Farley’s cautious hope that the AEPA Tribunal would be effective in resolving disputes.[405] 

Section 11 of the AEPA specifically empowers the Tribunal to make a determination that there has been a contravention of the Act, and to grant an order to remedy with respect to that contravention. The Tribunal may be expected to interpret its powers, in accordance with its mandate, purposively, in an effective and meaningful way. Labour tribunals enjoy substantial latitude when applying their constituent statutes to the facts of a given case.[406] 

Codification of Fraser in the manner we recommend coupled with serious efforts to form employee associations, engage in good faith bargaining and utilize the Tribunal may contribute to improving of the lives of vulnerable agricultural workers and if not, these efforts will provide a concrete evidentiary basis for future government or judicial consideration of the effectiveness of the legislation. 

The Law Commission of Ontario recommends that:

26. The Ontario government amend the AEPA by explicitly including the elements of bargaining in good faith protected by s.2(d) of the Charter as identified by the Supreme Court of Canada in Health Services and affirmed in Fraser.

Even where unionization is available, migrant and other vulnerable workers are frequently unwilling to join unions for fear of displeasing their employer, endangering their job and, for some, risking limited immigration status. While other provinces, except Alberta, have brought agricultural workers into their labour relations schemes, unionization rates of farm workers in other provinces are not high, although in Tucker’s view there has been a positive impact.[407] The inherent limitations of Ontario’s traditional collective bargaining process as applied to agricultural workers, as well as other vulnerable workers highly dependent on their employer, suggests that new models of labour support should be developed to respond to changing realities. 

There are several different forms of unionization that have emerged globally, as well as other forms of non-union association. Community unionism expands the focus of the union beyond the conditions of employment. It involves “the formation of coalitions between unions and non-labour groups in order to achieve common goals.”[408] This model developed, in part, in response to rising unemployment rates as a means of supporting unemployed workers who did not have a workplace within which to organize.[409] Unlike the traditional model of industrial unionism, it reaches workers who tend to move frequently among different workplaces such as temporary agency workers or dependent self-employed workers. 

Sector-based unionism in Canada has taken two dominant forms: craft unionism and labour market unionism. Craft unions, prominent in Canada prior to the rise of industrial unionism, “seek to provide their members with employment security by controlling the supply of labour and establishing a monopoly over skills.”[410] For instance, a union may collectively bargain for all workers in an industry with all potential labour users and become the sole provider of a certain form of skilled labour through the use of hiring halls, a form of union-run employment referral centre. Although difficult to organize, craft unionism has been used successfully in skilled sectors in Canada, with the construction industry serving as its most notable example.[411] Labour market unionism facilitates collective organizing and bargaining for workers located on multiple worksites who may be working with multiple employers.[412] Sectoral bargaining overcomes the problem of small shops and high turnover that typify many low-wage industries. 

International trade unionism facilitates international cooperation between unions as a response to the multinational nature of work in the globalized marketplace. With the establishment of the International Trade Union Confederation in the 2000s, member unions agree to take international policy into account when making domestic decisions and to provide the Confederation with both financial support and regular updates on the trade union’s activity.[413] In exchange, they receive “solidarity and assistance” from the Confederation.[414] 

Outside the Confederation framework, other international unions act across borders. For example, in the Canadian construction industry, labour relations are dominated by the 14 international building trades unions, headquartered in the United States with offices throughout Canada.[415] Another example is the UFCW which has entered into agreements with Mexican governments and advocacy groups to provide support to Mexican agricultural workers working in Canada under temporary foreign worker programs. It also supports these workers following repatriation.[416] Cross-border action by a national union is a unique alternative function for unions, consistent with community unionism as outlined above.

Unionization is not the only model available for supporting vulnerable workers. Other models of employee associations have sprung up, including non-profit hiring halls, cooperatives and mandatory employment councils. Still other models may emerge that better adapt to the changing nature of work in the 21st century. Worker organizations need to continue to adapt themselves to new situations. It may be useful for academics and/or a public policy think tank to consider a project to assist in the development of ideas for new forms of worker representation. 

The Law Commission of Ontario recommends that:

27. Academics and/or a policy think tank in consultation with relevant stakeholders undertake a review of possible alternative models to traditional unionization and the Wagner model of collective bargaining to support and assist vulnerable workers in the workplace, including consideration of emerging models for representing worker interests in various forms of precarious work in Ontario, including agricultural work, domestic work, temporary agency work and others.

 

5.     Innovative Solutions for Precarious Work Advisory Council

Some of our recommendations such as those involving the implementation of partnerships, those related to targeting high-risk industries and the modernization of ESA exemptions will require extensive consultation by government with workers and employer organizations, community agencies, government and experts. In the context of responding to the unique needs of vulnerable workers in the Occupational Health and Safety setting, the Dean Report recommended the use of an advisory committee appointed under s.21 of the OHSA which provides that “the Minister may appoint committees…or persons to assist and advise…on any matter that the Minister consider advisable.”[417] The government has committed to implementing this recommendation.[418] 

The Dean Report suggests: 

an advisory committee appointed under section 21 of the OHSA would improve the OHS system’s ability to respond to the needs of vulnerable workers. It would be a standing forum for consulting parties who are knowledgeable about vulnerable workers and have a role in protecting them. Such a committee could include representatives of labour and employer groups from sectors with precarious employment; immigrant and refugee support agencies; community and social service agencies; legal clinics; other ministries; and federal and municipal programs. Specific matters about which the committee could provide advice include implementing the Panel’s recommendations, improving enforcement strategies and developing and distributing awareness materials. [419] 

While the Employment Standards Act does not have a section comparable to s.21, this is not a bar to the implementation of such an expert advisory group on employment issues. A standing expert advisory group of participants willing to work together would be a valuable tool that the Ministry could draw upon to assist it in developing innovative solutions that respond to these and other emerging workplace issues. The issues that arise in this area can be contentious and views are often polarized along the worker-employer divide. It is very difficult to find areas of consensus. Project Advisory Group members questioned whether a single committee could adequately represent all the industry specific concerns and interests. This could be addressed by subcommittees of industry specific business, labour, academic and community representatives where areas of consideration require this type of specific expertise. 

For such an advisory council to operate successfully, participants must be willing to put aside differences and find ways to move forward on the issues; the right people must be chosen. This will require identification of individuals interested in reducing precarious work within current economic realities in government, academia, the business, labour and non-profit communities who have demonstrated balanced and creative thinking and an ability to engage in productive dialogue with participants representing opposing sides of the argument. 

The Law Commission of Ontario recommends that:

28. The Ministry of Labour convene an Innovative Solutions for Precarious Work Advisory Council of representatives of relevant ministries, experts, and labour and employer organizations to obtain advice and to develop initiatives for improved and expedited ESA compliance and enforcement with a view to recommending best practices for responding to the existing and emerging needs of vulnerable employees/precarious work in the changing workplace.

 

F.     Employment Legislation Protecting Temporary Foreign Workers

In recent years, concerns have increasingly been raised about the fair treatment of temporary foreign workers, particularly those in lower skilled employment. Governments have responded through a variety of legislative and policy measures. Federally, changes to the Immigration and Refugee Protection Regulations have been enacted that came into effect April 1, 2011. 

…the Government of Canada has become increasingly aware of instances where employers, or third-party agents working on their behalf, are failing to abide by commitments made to workers. Prior to these amendments, no provisions existed in the Regulations to hold employers accountable for their actions regarding TFWs [temporary foreign workers]. Breaches that could occur include employers paying TFWs less than promised; providing TFWs with poor working conditions or giving them different occupations from those agreed upon in the offer of employment; inadequate accommodations for some TFWs; and third-party agents charging fees to workers, rather than employers, in contravention of any existing provincial/territorial legislation.[420]

Employers seeking to hire temporary foreign workers must now demonstrate compliance with past offers of employment to such workers, including wages, working conditions, housing, health insurance, transportation and federal-provincial laws regulating employment. Failure to comply can result in denial of the Labour Market Opinion and a two year ban on hiring. In addition, the employer’s name may be posted on Citizenship and Immigration Canada’s website. It should be noted, however, as of the date of this Interim Report, no employers’ names are posted.[421] As previously mentioned, there are now standard form employment contracts for NOC C and D workers and live-in caregivers that employers must use covering wages, accommodation, benefits, hours of work, duties, vacation and sick leave entitlements. They require that health care insurance be provided at the employer’s expense until the worker is eligible for provincial health care coverage and a one week termination notice must be given to workers who have worked for longer than 3 months. Recruitment fees may not be recovered from the employee and transportation costs must be covered by employers and, unlike SAWP, which allows some cost recovery, transportation costs may not be recovered from the worker. 

The contract makes clear that terms are subject to provincial employment and health and safety standards. To respond to the need to provide greater protection for temporary foreign workers in the lower skilled NOC C and D Program there are more detailed and specific contract terms required for NOC C and D agricultural workers. Live-in caregivers, also in need of greater protection, have specific contract terms. Agricultural employers are required to provide appropriate housing (in accordance with guidelines and which may be at a cost to the employee), a Record of Employment and, at the employer’s expense, chemical and pesticide safety equipment.[422] Other federal changes limit the time that workers may remain in Canada to four years after which they must wait an additional four years before applying under the program again.[423] The intention is to reinforce the temporary nature of the work permits. SAWP workers are exempt from these limits. 

The live-in caregiver program provides for the option to obtain permanent residence at the completion of the service period. While this is a major advantage, it has caused some to refer to the live-in caregiver program as a “carrot and stick” approach to permanent residency requiring participants to remain working and living in their employers’ homes for the qualifying period during which workers are highly unlikely to risk termination of employment to complain about infringements of their rights.[424] Instances of exploitation and abuse have been well-documented: live-in caregivers have been required to work excessive hours, denied time-off, paid inadequate wages, physically and psychologically abused and had their passports confiscated.[425] With the location of the workplace inside private residences, monitoring and enforcement of employment standards is very difficult.[426]

Women coming to Canada under the Live-in Caregiver Program (LCP) face unique difficulties because they are confined to live and work in their employers’ homes for at least two (2) years. During this time, they are dependent upon their employers for wages, food, shelter, health care, and a good work reference to help them gain permanent resident status. Their dependent and temporary worker status puts live-in workers and caregivers at risk of unfair treatment and abuse by their employers. It also makes them less likely to complain, leave, or report the abuse for fear of losing the opportunity to gain permanent resident status.[427] 

In recognition of live-in caregivers’ need for special protection, in 2009 Ontario enacted the Employment Protections for Foreign Nationals Act (EPFNA).[428] This Act

  • prohibits recruiters from charging any fees to foreign live-in caregivers, either directly or indirectly.
  • prevents employers from recovering placement costs from the live-in caregiver.
  • prohibits employers and recruiters from taking a live-in caregiver’s property, including documents such as a passport or work permit.
  • prohibits a recruiter, an employer, or a person acting on their behalf from intimidating or penalizing a live-in caregiver for asking about or asserting their rights under the Act.
  • requires recruiters and, in some situations, employers to distribute information sheets to live-in caregivers setting out their rights under the EPFNA and those provisions of the Employment Standards Act, 2000 (ESA) considered to be of particular relevance.[429]

When the new legislation first became effective, the Ministry of Labour set up a hotline for live-in caregivers to call for information; however, the hotline has since been discontinued. The Ministry has developed fact sheets in English, French, Hindi, Filipino and Spanish, available on its website, for employers and recruiters to provide to workers explaining the new legislation.

In addition to federal protections outlined above that have been implemented for temporary foreign workers, genuineness assessments for offers of employment to live-in caregivers now have additional criteria beyond those for other migrant workers.[430] Employers must demonstrate the “need for the live-in caregiver, the provision of adequate accommodation, and the ability to pay the wages offered”.[431] Effective December 11, 2011, live-in caregivers who have completed the requirements for permanent residency receive open work permits while awaiting finalization of their status. This permits them to move out of the employer’s home sooner and seek work in other fields.[432]

In our consultations, we were advised that the main areas of concern for live-in caregivers are non-payment of wages, unresolved claims with the Ministry of Labour, performing non-caregiver tasks (e.g., nursing, housework and similar tasks) and little control over working hours. Some workers’ advocate groups have suggested that EPFNA protections have been ineffective. They suggest that the Ministry’s enforcement efforts have been directed solely at recruiters and otherwise have been inadequate. In their view, workers need more knowledge of rights, more support for asserting their rights, less fear of reprisal, the ability to make anonymous complaints to the Ministry of Labour and proactive enforcement.[433]

In our consultations during 2011, we met with workers in the NOC C and D program who reported paying between $5,000 to $12,000 to a recruiter to come to work in Canada. To pay these amounts, each had to take significant loans for at least half of the recruiter’s fee, with the balance paid from the worker’s savings. The work that was made available paid minimum wage ($10.25/hr).[434] The payment of the recruiter’s fee and the debt incurred played a significant role in the decision of these workers to stay in very unfavourable working conditions. While the new federal standard form contract aims to negate employers passing on recruiter fees to workers through contractual terms, it remains to be seen whether it will be effective. In our view, there would be a greater chance of success if the province supported the federal initiative with a clear message of denouncement against unscrupulous recruitment fees by extending the Employment Protection for Foreign Nationals Act (EPFNA) to all temporary migrant workers.[435]

Manitoba’s response to exploitive recruitment fees, workers arriving to find no job available and the developing underground economy was the Worker Recruitment and Protection Act (WRAPA) which came into effect April 1, 2009.[436] The Act requires employers seeking to hire temporary migrant workers to register with the Manitoba government before seeking an LMO with HRSDC. With cooperation from the federal government, an employer must show proof of registration in Manitoba before an LMO application can proceed. Registration under the WRAPA requires employers to 

provide information on their company, the types of positions they want to fill and, if applicable, the third parties that will be involved in the recruitment process. Third parties must be licensed as foreign worker recruiters by the Manitoba Employment Standards Branch or exempt from the legislation.[437] 

A key advantage to the legislation is that the government of Manitoba knows where the migrant workers are, allowing for compliance monitoring. Similar to the federal government’s new genuineness assessment, Manitoba considers the employer’s past conduct in assessing the merits of the application. 

The Manitoba Ministry of Labour maintains a database for employers to assess compliance history. The legislation has resulted in approximately 2,000 business registrations each year and there are currently more than 50 recruiters registered.[438] While initial start-up resources were higher, currently the program utilizes five full time equivalent positions for its operation including enforcement. Manitoba received approximately 3,000 entries of foreign workers in 2010, while Ontario received 66,000. Translating this program to Ontario, we could expect resource requirements to be very high compared to Manitoba. The question is whether it would be a good use of very substantial resources given other concerns we have identified regarding the need for increased proactive enforcement, for example. The LCO received mixed reaction from those we consulted about the feasibility of this type of regulatory scheme for Ontario. In general, respondents were of the view that, while helpful, it would not be a complete response to concerns about migrant labour. Without effective enforcement and the requisite resources behind it, some were concerned that such legislation would become a registration only on paper. 

In our view, rather than enacting another statute, it would be preferable for Ontario to build upon what is already in place. EPFNA currently applies only to live-in caregivers. But it has a structure in place to permit its extension to other classes of migrant workers by way of regulation. Prescribing all temporary migrant workers under EPFNA would extend protections against unscrupulous recruitment. Coupled with the federal protections described above regarding genuineness assessments, these measures could provide a substantial level of protection to migrant workers. 

The Law Commission of Ontario recommends that:

29. The Ontario government extend the Employment Protection for Foreign Nationals Act to all temporary migrant workers in Ontario.

For Ontario, one of the gaps to be closed is to ensure that information about the identity and whereabouts of temporary foreign workers and their employers is received in order to enforce existing legislation. As a means of enforcing the new protective regulations and supporting provincial initiatives to protect migrant workers, the federal government is seeking to improve federal-provincial information-sharing. HRSDC advises that it may share decisions made on labour market opinions (LMOs)

with federal-provincial/ territorial governments for the purpose of the administration and enforcement of relevant legislation and regulations (e.g. employment standards, occupational health and safety, immigration, and third party recruitment).[439]

To support federal decision-making on LMOs and genuineness assessments, Ontario needs to have a clear process for communicating to the federal government on non-compliant employers. The flow of such information requires a Canada-Ontario information-sharing agreement. The federal government has indicated its desire to negotiate such agreements and other provinces, including Manitoba, have had them in place for a number of years.[440] However, despite ongoing discussions, no such agreement yet exists between Ontario and the federal government. Information-sharing agreements by their very nature raise complex issues about privacy and the use of personal information, and therefore they are also time-consuming and challenging for governments to negotiate. However, in the absence of such an agreement, information about the names and whereabouts of employers and foreign workers obtained by the federal government will not be available to Ontario for enforcement mechanisms. Moreover, federal efforts to protect migrant workers through the genuineness assessment will be much less effective.

The Law Commission of Ontario recommends that:

30. The Ontario government negotiate an information-sharing agreement with Human Resources and Skills Development Canada and Citizenship and Immigration Canada to permit information to flow between Ontario and the federal government for the purpose of increasing protections for temporary foreign workers by:

a) strengthening federal-provincial oversight over temporary foreign worker contracts;

b) increasing enforcement of temporary migrant workers’ rights under provincial legislation; and

c) imposing consequences upon employers who violate provincial legislation or breach contractual agreements with temporary foreign workers.

In the LCO’s consultations, some workers’ advocates expressed the view that temporary foreign worker programs should never be utilized to respond to labour needs. In their view, these programs create too great a power imbalance between employer and worker due to the dependency of the workers’ immigration status on the employment relationship. This, they say, lays the foundation for the risk of exploitation, creating a situation in which workers will never feel sufficiently secure to assert their rights. These observers believe that the federal government should refocus its efforts away from temporary labour and invest in making long term immigration decisions to secure a sufficient workforce for Canada’s needs. In other words, Canada’s immigration policies should include provision for accepting lower skilled workers on a more permanent basis. 

However, temporary labour has its benefits. Canada and Ontario obtain labour for the period it is needed but do not have to support the worker over periods of unemployment. Workers who need employment can obtain it, supporting themselves and their families in their home country. Workers’ countries of origin receive benefits in the form of the self-sufficiency of their citizens. Our immigration system emphasizes a preference for skilled and educated workers as permanent residents rather than workers for low skilled employment. Given that there are very few new jobs created in Canada for the workers in lower skilled jobs, there may be some sense to this. The Fraser Institute, in contrast, suggests that the lower skilled work currently performed by temporary foreign workers should be performed by permanent residents or citizens.[441] In our view, this overlooks the reality that employers have been unable to find suitable local employees for these positions although recent federal initiatives to make changes to the Employment Insurance program requiring unemployed Canadians to accept a broader range of work may perhaps be targeted at this issue.[442] At this point, Ontario’s agricultural industry is highly dependent upon the temporary foreign worker labour force. We import it every year. It may be that the time has come for an acceptance and a greater appreciation of the contribution made by lower skilled migrant workers.

 

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