Exception to Continuity of Employment in Ontario (New Provider)

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 10(2) and 10 (3) of the Act state:
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 replaced provider shall be deemed to have been employment with the new provider for the purpose of any subsequent calculation of the employee’s length or period of employment.
Subsection (2) does not apply if the day on which the new provider hires the employee is more than 13 weeks after the earlier of his or her last day of employment with the replaced provider and the day on which the new provider began servicing the premises.
This means that if 13 weeks have passed between the last day of work with the replaced provider and starting with a new service provider, there is no continuity of employment and any entitlement to termination or severance pay would fall on the replaced provider. In other words, if the new provider hires the employee of the replaced provider and 13 weeks have passed before the employee starts his or her job with the new provider, there is no continuity of employment. The replaced provider owes the employee his or her termination or severance pay.
     .     Employer A loses contract for the building services to Employer B.
     .     Changeover date is June 14 2010.
     .     A’s employee is laid off one week before the changeover date (June 7). Temporary
           lay-off for notice of termination purposes ends September 6 (13 weeks after lay-
           off began and 12 weeks after the changeover date). Under the Act, the employee is
           deemed to be terminated on first day of lay-off (June 7).
     .     However, the employee’s last day of work is considered to be September 6, for the
           purpose of Section 10.
     .     Employer B hires the employee on or before September 13, that is, within 13
           weeks after June 14, the changeover date.
     .     Employer B subsequently terminates the employee. Under section 10 (2), the
           employee was deemed not to have been terminated by employer A and the
           employee’s employment with employer A is now added to the employee’s
           employment with employer B.
Therefore, any entitlement under the Act would be based on the combined period of employment with both employers A and B and the employer B would be held responsible to provide that even though the employee’s employment ended with employer A on September 6 and his termination date was deemed to be June 7.          
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.    
In the past, the Ministry was very aggressive in defending the rights of an employee and would send a legal counsel to represent the employee at the Board’s hearing to deal with the matter. It rarely does so now. Obviously, the employer has advantage over the employee in these circumstances. The question arises, should the employee also engage the services of a professional? It is my view, employee’s may not engage such services at the officer’s level hearing but may do so at the at the referee level hearing, particularly, if the issues are complex.
It is important that if a hearing has been scheduled, the employee must attend such a hearing to present evidence to support its position or to contest the employer’s evidence, otherwise, the officer or the referee may rely on the evidence of the employer to render a decision.   
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 [email protected]       

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

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