Temporary Pandemic Pay – Update on Recent Developments
Date: May 7, 2020
On April 25, 2020, the Ontario government announced that it would be providing pandemic pay on a temporary basis to frontline workers fighting COVID-19 with the aim of providing additional support to frontline workers and maintaining staffing levels of frontline services. We previously notified employers of this development in our HR Healthcheck of the same date, New Measures to Support the Delivery of Frontline Care in the Long-Term Care Setting.
There have been two developments this week in relation to pandemic pay: a temporary amendment to Bill 124, the Protecting a Sustainable Public Sector for Future Generations Act, 2019 (Bill 124) and the publication of a page entitled “COVID-19: Temporary pandemic pay” on the government website. However, key details, including how pandemic pay is to be operationalized, have yet to be announced. We therefore continue to advise employers to wait for the government to communicate this information before taking steps to implement any form of pandemic pay.
Bill 124 Amendments
On May 1, the government issued a new order under the Emergency Management and Civil Protection Act that temporarily amends Bill 124: O. Reg. 195/20 Treatment of Temporary COVID-19 Related Payments To Employees (Order).
Under the Order, the government has temporarily suspended the operation of the 1% limit on salary increases, but only in relation to “temporary COVID-19 related payments,” and only in relation to employees who either: (1) perform work in a listed workplace during the period that the order is in effect, or (2) perform certain types of listed work during that same period.
The listed workplaces in category one, above, include such workplaces as hospitals, long-term care and retirement homes, psychiatric facilities, homeless shelters and children’s aid societies. The second category covers types of work such as homeless outreach services, certain paramedical services and homemaker or nursing services performed in a person’s home.
Employers who are subject to Bill 124 should review the text of the Order for the full list of workplaces and types of work (in this regard, the Order does not amend the list of employers who must comply with Bill 124 more generally).
New Government Website
On May 6, the government launched its “COVID-19: Temporary pandemic pay” website.
The website includes much of the information already announced by the government and confirms that there will be two forms of pandemic pay available. First, eligible employees will receive $4 per hour on top of existing hourly wages for all hours worked from April 24, 2020 to August 13, 2020. Second, eligible employees who work at least 100 hours in a designated four-week period will also receive a lump sum payment of $250 for that period. The four-week periods are from April 24, 2020 to May 21, 2020; May 22, 2020 to June 18, 2020; June 19 2020 to July 16, 2020; and July 17, 2020 to August 13, 2020.
The website reasserts the government’s prior statement that pandemic pay will not be made available to management employees, and provides a list of eligible classifications for a range of eligible workplaces. Employers should consult the website for the complete list.
Among other matters, the website confirms that pandemic pay applies only to eligible employees when they are actually performing work. In other words, eligible employees do not receive the pandemic pay while on vacation or on a leave of absence.
Takeaways for Employers
While these developments provide some information for employers whose employees will be eligible for pandemic pay, there remain some key unknown elements before the pandemic pay can be implemented by employers.
For example, the website indicates that pandemic pay would not be considered part of an employee’s base salary, would not be considered pensionable earnings, nor would it have any impact on benefits paid by employers. However, it is not yet clear how any of this will be implemented, or whether there will be further orders issued by the government to ensure its intentions can be given effect in light of employers’ various contractual and statutory obligations.
The government has indicated that it will contact all eligible employers by May 15, 2020, and it will presumably be communicating some of this key information at that time. In light of this, we continue to recommend that employers not implement any form of pandemic pay until those further details are provided by the government. We will continue monitoring developments and will communicate to our clients as soon as we learn of further information.
Should you require further information about this new development, please contact Rebecca Liu at 416.864.7351, Paul Broad at 416.864.7286. Mark Mason at 416.864.7280 or your regular Hicks Morley lawyer.
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