Continuity of Employment in Ontario (Revised)

What is the Employment Standards Act?
The Employment Standards Act is the law that contains basic rules about employing people and working. Both employees and employers have rights and
responsibilities under the Act.
Does the Act cover all employees in Ontario?
Most employees are covered by the provincial legislation. However, employees working in industries that fall under Federal jurisdiction, such as, Post office, Banks, Railways, Radio stations, Airlines, Television stations etc. are not covered. 
If you are member of the trade union and your contract of employment is governed by the collective agreement, you may not be covered by the Act.
If you are currently employed with the company, you may be able to file a claim with a request that your name not be disclosed. The Act protects you when you are exercising your rights under it.
Section 9(1) of the Act states:
If an employer sells a business or a part of a business and the purchaser employs an employee of the seller, the employment of the employee shall be deemed not to have been terminated or severed for the purpose of this Act and his or her employment with the seller shall be deemed to have been employment with the purchaser for the purpose of any subsequent calculation of the employee’s length or period of employment.
This section clarifies that if a business is sold whether all or part of it and the purchaser of the business continue to employ the employee of the seller, the period of employment of the employee with the seller is added to the employment period of the purchaser. In other words, the employee is considered to have been continuously employed by the purchaser of the business, that is, for the purpose of calculating his or her entitlements under the Act, the total period of employment will be considered including his or her period of employment with the seller of the business.
Following are the entitlements for which total period of employment will be considered:
     1.     Vacation- Employees are entitled to two weeks of vacation with pay after completing 12 month of vacation entitlement year.
     2.      Pregnancy Leave- Employees may be entitled to pregnancy leave if they have been employed for at least 13 weeks prior to the expected date of birth.
     3.      Parental Leave- Employees may be entitled to parental leave if they have been employed for at least 13 weeks prior to commencing the pregnancy leave.
     4.    Written Notice of Termination or pay in lieu:
             Employees may be entitled to notice or pay in lieu of notice if they have been continuously employed for at least three months.
             Entitlement to one to eight weeks of notice or pay in lieu depends on the length of employment.
     5.     Severance Pay- Employees may be entitled to severance pay if they have been employed for at least 5 years and the employer’s payroll is over $2.5 million.
             Entitlement to severance pay up to 26 weeks depends on the length of employment.
Note: The continuity of employment applies only to companies sold between same jurisdiction, that is, if the company under provincial jurisdiction is sold to a company under federal jurisdiction or vice versa, the continuity of employment provision of the Act would not apply.
The sale of a business or part of it is broadly defined under the Act:
“sells” includes leases transfers or disposes of in any other manner, and “sale” has a corresponding meaning.
“ business” includes an activity, trade or undertaking:
If you or the employer disagrees with the investigating officer’s decision, both parties have a right to appeal to Ontario Labour Relations Board within 30 days of the officer’s decision. The Board appoints a referee to hear the appeal. It does not cost the employee to request an appeal but the employer may be required to deposit monies in trust with the Ministry of Labour if it is found to be owing. The referee decision is final and binding on both parties.    
This information is provided for guidance only and should not be considered as a legal advice.

This article is provided by Rajinder K. Batra, who is a retired Employment Standards Officer with the Ministry of Labour with 15 years experience in these matters.

If you have any questions regarding your employment, please contact the writer by e-mail at     

If you don’t have access to e-mail; you can fax your question at (905) 331-1805.

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