Employment Standards Update: Increased Protection for Temporary Workers

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One recent amendment and one proposed amendment to the Employment Standards Act, 2000 (ESA) will have a significant impact on employers who employ elect to work and temporary help employees.

As of January 2, 2009, employees who work under arrangements whereby they may choose whether or not to work when requested are entitled to holiday pay, or the designation of an alternate day off in lieu of holiday pay. Family Day in February was the first holiday on which elect to work employees were entitled to public holiday pay.

Bill 139, Employment Standards Amendment Act (Temporary Help Agencies), 2008, was introduced by the Ontario government in December in an attempt to create additional protections for temporary workers. The Bill requires temporary help agencies to provide specific information to their employees, including information about the agency itself, the client to whom the employee is assigned to work, and the employee’s rights under the ESA.

In the spirit of removing barriers that prevent temporary employees from attaining permanent employment, the amendment would prohibit temporary help agencies from any of the following:

  • Charging a fee to an employee for employment, assignment to a client, or job search assistance;
  • Restricting an employee from entering into an employment relationship with a client of the agency; and
  • Charging a “finder’s fee” or “temporary to permanent fee” to an employee or a client in respect of an employee who began to work for the client at least six months earlier.

In anticipation of a future amendment that would remove the exemption of temporary employees from the ESA’s termination and severance provisions, Bill 139 also sets out the method by which termination and severance pay for temporary workers is to be calculated. The Bill states that a temporary worker will be deemed to have been terminated when he or she has not been assigned work for 35 consecutive weeks.

Bill 139 was carried after its second reading, and was referred to a standing committee on March 2, 2009. If it receives Royal Assent, it will come into force six months after that date.

The above amendments will have both positive and negative implications for employers who use temporary help agencies. On the one hand, Bill 139 will make it easier and more affordable for businesses to transition employees from temporary workers to permanent staff. However, employing temporary staff may become more expensive, given that public holiday pay is now required, and termination and severance pay may soon become applicable to temporary workers.