Some Ontario employers have been pushing back against the province’s new minimum wage law by cutting wages and benefits for staff.
In response, the province plans to hire 175 additional inspectors to make sure the labour changes brought in on Jan, 1, 2018, are being followed.
Colleen Dunlop is an Ottawa labour lawyer representing employers, and Paul Champ is an Ottawa labour lawyer representing employees.
We asked them where the legal line is when it comes to employers and businesses clawing back benefits and perks.
Q: Some Tim Hortons franchises have faced backlash for cutting paid breaks and reducing benefits. Is what they did legal?
COLLEEN: There is no legal entitlement to paid breaks in Ontario. So it is legal for them to claw back paid breaks.
Q: What about employees losing their staff discount, or having to pay for uniforms when they didn’t have to before?
COLLEEN: Yes, these are legal methods an employer can use to reduce costs.
Q: Paul, do you agree?
PAUL: It’s legal according to the Employment Standards Act, but it is likely a violation of the contract between the employer and the employees, and that can constitute something called constructive dismissal. If an employer makes too many fundamental changes to an employee’s terms of employment that they were already giving them, and if those changes, amount to a 10 to 20 per cent cut in the person’s overall earnings, it’s considered constructive dismissal, and the person could sue.
Q: If I work five days a week, and I am cut back to four, that’s a 20 per cent cut in hours. Am I being constructively dismissed?
COLLEEN: There is an argument that you are, because you are losing 20 per cent of your income, and an employer is definitely crossing the line.
Q: Labour Minister Kevin Flynn has talked about allegations that businesses in Scarborough told employees to leave their tips in the till. Is that against the law?
PAUL: That is definitely against the Employment Standards Act. Employers cannot take a cut of tips. There are policies about “tip outs,” where a percentage of tips is taken and distributed to other employees such as dishwashers and cooks. That is legal. But if an employer takes a cut of the tips and keeps them, they’ve broken the law.
Q: Colleen, are you getting calls from business owners wondering what options they have?
COLLEEN: Yes. Employers, especially those with limited budgets — social service agencies and small employers — are faced…