Are Canadian retail giants at risk of walk outs by low income workers similar to their counterparts south of the border? According to Meghan Ferguson, employment and human rights lawyer with DSF, although retail employment is on the rise in Canada, workers employed by American outlets in Canada are currently better protected than their U.S. counterparts. But for how long?
“The basic difference is that Canada has many existing regulations to protect the legal rights of workers,” says Ferguson, who has spent a number of years as legal counsel in the retail sector. “A decent living is hard to achieve for any front-line workers in the retail or fast food industry. We will see more people occupy these low-paying jobs as more American retail chains open in Canada.”
But there was good news for low income workers last month. On December 4, 2013, the Ontario government introduced amendments to Employment Standards legislation. If passed, the legislation will remove the Ontario Ministry of Labour’s $10,000 cap on the recovery of unpaid wages and increase the time limit for an unpaid wage claim from six months to two years. “This will make it easier for low income workers, like retail employees, to recover wages without having to go to court or incurring legal costs.”
“Retail workers in Canada can file complaints more easily with the provincial ministry of labour.” Complaints are often resolved without formal legal action and corporations settle to avoid government investigations and/or penalties.”
This fundamental difference in the retail employee experience provides a major protection for lower-income Canadians.
Under the current law, a worker who files a complaint for termination and severance pay with the Ontario Ministry of Labour can only recover a maximum of $10,000, no matter how much their employer owes them. If the legislation is passed, a worker will be able to recover the full amount.
The legislation would require an employer in Ontario to complete an audit of their employment records and practices to determine if the employer has complied with part or all of the Employment Standards Act (ESA). An employer may have to produce a report to the Ministry of Labour about their compliance with employment standards. Companies that fail to comply with the ESA could be subject to Ministry of Labour orders and fines of up to $100,000 (or for repeated violations up to $500,000). Individuals such as directors and senior management could be fined up to $50,000 or imprisoned for up to 12 months for failing to comply with the Act.
“Simply put, the rights of Canadian retail workers are protected under provincial employment standards acts,” Ferguson says. “We see a lot of pay practice lawsuits and, more recently, protests in the U.S. for workers’ rights, but the same trend is not necessarily crossing the border. Government regulation and hefty fines will likely be the Canadian experience.”