Federal Post

New Administrative Monetary Penalties under Canada Labour Code Coming into Force on January 1, 2021

Federal Post

New Administrative Monetary Penalties under Canada Labour Code Coming into Force on January 1, 2021

Date: December 11, 2020

On January 1, 2021, the new Part IV “Administrative Monetary Penalties” of the Canada Labour Code (Code) will come into force together with other amendments to the Code.

Part IV Administrative Monetary Penalties

Part IV was enacted by Bill C-44, Budget Implementation Act, 2017, No. 1. Among other things, Part IV:

  • establishes a penalty system to promote compliance with Parts II and III of the Canada Labour Code
  • provides broad regulation-making authority, including authority to set out specific contraventions and penalties (any penalty amount set by regulation cannot exceed $250,000)
  • provides that any person who contravenes or fails to comply with the regulations made under Part IV will be liable to a penalty in the amount set by regulation
  • where the violation is committed by a corporation, adds any of the corporation’s officers, directors, agents or mandataries, senior officials or persons exercising managerial or supervisory functions as a party to the violation where they directed, authorized, assented to, acquiesced in or participated in the commission of the violation
  • removes certain defences to a person named in the violation, namely that the person cannot argue that they exercised due diligence to prevent the violation or that they reasonably and honestly believed in the existence of facts that, if true, would exonerate the person
  • provides the Minister with certain powers regarding notices of violations and the review process under Part IV
  • provides an appeal process from a decision of the Minister to the Canada Industrial Relations Board (CIRB).  

Note that Part IV also applies to departments in the federal public administration which are subject to Part II of the Code.

Regulations have been made under Part IV and the text will be published in the Canada Gazette on December 23, 2020. It is expected that these regulations will also come into force on January 1, 2021.

Other Amendments in Force January 1, 2021

Bill C-44 also enacted provisions that permit inspectors to issue compliance orders if they are of the opinion that an employer is contravening or has contravened Part III or any provision of an excess hours permit, subject to certain limitations. These changes come into force on January 1, 2021.

An amendment enacted to the Code by Bill C-65, An Act to amend the Canada Labour Code (harassment and violence), the Parliamentary Employment and Staff Relations Act and the Budget Implementation Act, 2017, No. 1, is also coming into force January 1, 2021. It amends the Code to provide for Pilot Projects, to be set out by regulation, for assessing possible amendments to Part IV or the regulations made under it to improve compliance with Parts II and III of the Code.

If you have any questions relating to these incoming Code amendments, please contact David Foster or your regular Hicks Morley Lawyer.


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