Hiring an Employee in Ontario

Hiring an Employee in Ontario

Hiring an Employee in Ontario

1. Recruitment

What are the requirements relating to advertising positions?

In accordance with Ontario’s accessibility legislation, advertisements should note that employers will provide accommodations during the hiring process for candidates who have a disability.

Job advertisements should also comply with Ontario’s human rights legislation and should not contain statements, qualifications, or references related to a protected ground of discrimination,
or imply any limitations, specifications, or preferences based on a protected ground of
discrimination. The Ontario Human Rights Code prohibits actions that discriminate against people based on the following protected grounds:

  •  age
  • ancestry/colour/race
  • citizenship
  • ethnic origin/place of origin
  • creed
  • disability
  •  family status
  • marital status (including single status)
  • gender identity/gender expression
  • record of offences
  • sex (including pregnancy and breastfeeding), and
  • sexual orientation.

What can employers do with regard to background checks and inquiries?

(a) Criminal Records and Arrests

On November 1, 2018, the Police Records Check Reform Act, 2015 came into force in Ontario.The Police Records Check Reform Act provides a comprehensive set of standards which govern how police record checks are to be conducted and the information that will be available for
employment purposes. Specifically, the three types of criminal records checks that an employer can now request are: (1) criminal records checks, (2) criminal records and judicial matters checks, and/or (3) vulnerable sector checks.

The Police Records Check Reform Act imposes limitations on the information that an employer can obtain in response to a criminal record check request. The employer can only receive the requested criminal records check if the individual who is subject to the records check consents to its disclosure.

Employers should be careful to only use the criminal records check provided for the purpose that it was requested or as authorized by law. Section 2(1) of the Police Records Check Reform Act outlines some of the permitted purposes to include, without limitation: (a) determining suitability for employment, volunteer work, a license, an office, membership in any body or to provide or receive goods or services; or (b) assessing an application to an education institution or program. An employer who willfully misuses disclosed information for an improper purpose is in contravention of the Police Records Check Reform Act and may be found guilty of a provincial offence, resulting in a fine not exceeding $5,000.

As a best practice, employers should wait to perform all background checks until a conditional offer of employment has been extended. Employers may request that an applicant consent to a criminal record check as part of a conditional offer of employment. Employers may not discriminate against applicants for convictions for an offence for which a pardon has been granted or a record suspension has been ordered, unless there is a bona fide occupational requirement.

(b) Medical history

The medical history of an applicant should not be considered in the recruitment and hiring process, except where there is a bona fide occupational requirement (i.e. a condition that may affect his or her ability to perform the job safely and will threaten the safety of the applicant or others). Once a conditional offer of employment has been extended, further questions may be asked about the applicant’s medical history as part of their pre-employment medical testing; however, the questions must relate to conditions which are directly relevant to the specific duties of the position in question.

(c) Drug Screening

Under Ontario’s human rights legislation, drug and alcohol testing is inherently discriminatory, particularly as addiction is viewed as a disability. Subject to very limited exceptions, pre-employment and random testing is not permitted in Ontario. These exceptions generally apply to employees performing part of their work in the United States, such as international transport truck drivers, in states where drug screening is a requirement under US law.

If testing it conducted, its primary purpose must be to measure impairment, as opposed to deterring drug or alcohol use or monitoring moral values among employees. Even testing that measures impairment can be justified as a bona fide requirement only if it is demonstrably connected to performing the job (for example, if an employee occupies a safety-sensitive position and is involved in a significant accident or “near-miss”), and only then as part of a larger assessment of drug and alcohol addiction.

The Ontario Human Rights Commission has released a policy on drug and alcohol testing that may be useful to employers.

(d) Credit Checks

Although credit checks are permitted with the applicant’s consent, it is best practice to conduct credit checks only where it would be reasonable to do so (e.g., for positions where the applicant will have access to significant sums of money or valuable merchandise). Consumer reporting legislation also sets out further consent requirements and prescribed procedures. Worth noting is that federally regulated employers are governed by the Personal Information Protection and Electronic Documents Act; therefore, such employers can request credit checks only where it would be reasonable to do so in accordance with this governing law.

(e) Immigration Status

While employers can request proof from applicants that they are legally able to work in Canada as a condition of their employment, they are prohibited from inquiring into a prospective employee’s ancestry, citizenship, ethnic origin, or place of origin under Ontario’s human rights legislation.

(f) Social Media

While employers may review an applicant’s social media presence, social media checks during the recruitment and hiring stage can increase the risk of a discrimination complaint, particularly if the information gained from an applicant’s social media presence may be connected to a protected ground of discrimination. As best practice, employers should obtain an applicant’s consent before reviewing their social media presence to ensure that they are in compliance with privacy legislation.

(g) Pay Equity

Ontario’s pay equity legislation, the Pay Equity Act, 1990 requires that employers develop a pay equity plan to ensure that there is no gender bias in compensation for women and men performing substantially the same job or different jobs of equal value. Employers should ensure that this plan is updated routinely to address changing circumstances.

To complement the equal pay for equal work provisions in the Pay Equity Act, the Government of Ontario introduced the Pay Transparency Act in 2018. The Pay Transparency Act imposes additional rules upon affected employers which include, but are not limited to, requiring that public job advertisements include a salary rate or range, requiring the preparation of a “pay transparency report”, and the inclusion of anti-reprisal measures intended to safeguard employees from being penalized or intimidated upon making inquiries about their compensation or disclosing their compensation to other employees. 

(h) Employee Accommodations

All Ontario employers have obligations to notify candidates and employees about the availability of accommodations and provide such accommodations at all times, including during the recruitment process. As noted earlier, information about the availability of accommodations should be made part of an employer’s regular job advertisements. Offers of employment must also contain explicit information regarding the company’s policies on accommodation.

Ontario’s legislation necessitates employers create and maintain:

  • an explicit written  process for the development of a written accommodation plan for employees with disabilities; and
  • a written return-to-work policy for employees that have been absent from work due to illness or disability and require accommodation to facilities their return to work.

Employers must advise their employees of the company’s policies on supporting employees with disabilities and the availability of job accommodations for employees with disabilities. It is best practice to advise new employees of these policies during their orientation or training period and provide written resources. Upon request by an employee, an employer must also provide any information that is generally available to employees and any information an employee requires to perform their job in an accessible format. Finally, employers should demonstrate that they have considered an employee’s disability, accessibility needs and accommodation plan, if applicable, when considering an employee’s performance management reviews, career development and advancement and redeployment.

(i) Equal Wages for “Substantially the Same Work”

Employers must pay part-time, temporary, casual, seasonal employees, and temporary help agency employees the same wages as full-time employees if they are doing substantially the same work as full-time employees. 

  1. What federal or provincial laws govern the employment relationship?

The Employment Standards Act, 2000, sets out most of the minimum employment standards for provincially regulated workplaces in Ontario.

There are a number of other statutes affecting the employment relationship in provincially regulated workplaces in Ontario, including:

  • Accessibility Ontarians with Disabilities Act, 2005
  • Agricultural Employees Protection Act, 2002
  • Apprenticeship and Certification Act, 1998
  • Cannabis Act, 2017
  • Crown Employees Collective Bargaining Act, 1993
  • Employers and Employees Act
  • Employment Insurance Act
  • Employment Protection for Foreign Nationals Act, 2009
  • Employment Standards Act, 2000
  • Fair Workplaces, Better Jobs Act, 2017
  • Hospital Labour Disputes Arbitration Act, 1990
  • Human Rights Code (Ontario)
  • Labour Relations Act, 1995
  • Ministry of Labour Act, 1990
  • Occupational Health and Safety Act,1990
  • Ontarians with Disabilities Act, 2001
  • Ontario College of Trades and Apprenticeship Act, 2009
  • Ontario Labour Mobility Act, 2009
  • Pay Equity Act, 1990
  • Pay Transparency Act, 2018
  • Police Records Check Reform Act, 2015
  • Provincial Schools Negotiations Act, 1990
  • Protecting Child Performers Act, 2015
  • Public Sector Labour Relations Transition Act, 1997
  • Public Service of Ontario Act, 2006
  • Retail Business Holidays Act
  • Rights of Labour Act
  • Smoke-Free Ontario Act, 2017
  • Trades Qualification and Apprenticeship Act, 1990
  • Wages Act; and
  • Workplace Safety and Insurance Act, 1997. 

There are a number of other statutes affecting the employment relationship in federally regulated workplaces in Ontario, including:

  • Canada Labour Code
  • Canadian Human Rights Act
  • Employment Equity Act
  • Employment Insurance Act, and
  • Personal Information Protection and Electronic Documents Act.

 Who do these cover, including categories of workers?

Depending on the circumstances, independent contractors, dependent contractors, consultants, interns, employees of affiliates, employees from temporary agencies and third party employees can be considered employees or workers for some common law or statutory purposes.

The definition of “employee” and “worker” varies among the legislation. The Labour Relations Act, 1995, for instance, explicitly includes “dependent contractor” in the definition of “employee”. The Occupational Health and Safety Act defines “worker” to include self-employed individuals, independent contractors and temporary workers. 

Employee/Contractor Misclassification

 A person may be classified as an independent contractor at common law, but because of economic dependence on and control by the entity for which the services are performed, legally qualify as a dependent contractor.

A person may also be classified as a dependent contractor notwithstanding that he or she conducts business through a corporation and hires others to assist in the performance of the work. The usual distinction between a dependent contractor as compared to an independent contractor is that a dependent contractor is entitled to reasonable notice of termination of the agreement.

Different employment related legislation (i.e., tax and safety) may treat dependent or independent contractors as employees or workers subject to particular legislation.

Though the distinction between independent contractors and employees has not been fully clarified, the Fair Workplaces, Better Jobs Act, 2017 (Bill 148) provided new rules with respect to misclassification. First, if there is a question about whether someone is an employee or an independent contractor, a “reverse onus” is now triggered, meaning the burden is now on the employer to prove that the person is an independent contractor and not an employee under the Employment Standards Act. Second, if a person is misclassified, that is the individual is treated as an independent contractor when they are in practice an employee, the Ministry of Labour may commence a prosecution against that employer. The “reverse onus” provision does not apply in a Ministry of Labour prosecution.

Contracts of Employment

 Must an employment contract be in writing?

While preferable for the protection of both parties, an employment contract need not be in writing. To be enforceable, an employment contract simply requires the requisite elements of any contract: an offer made with the intent to create legal relations, acceptance of that offer, consideration, capacity, and legality. Where a written contract of employment has been contemplated but not signed, the contractual agreement will be enforceable if the conduct of the parties shows that their clear intent was to enter into a binding contract. In many cases contracts are part oral, part written, and part implied by the common law. 

 Are any terms implied into employment contracts?

Employment contracts can be oral or written and may include express and implied terms. It is implied in every contract of employment that an employer will provide the employee with reasonable notice in the event of termination, except in the event of just cause. Other examples of implied terms are that employees will perform their duties with reasonable skill and diligence, and that they have a duty of loyalty to their employee. Usually only senior employees would owe a fiduciary duty to their employers.

Are mandatory arbitration agreements enforceable?

Section 7(1) of the Arbitrations Act, 1991 states:

“If a party to an arbitration agreement commences a proceeding in respect of a matter to be submitted to arbitration under the agreement, the court in which the proceeding is commenced shall, on the motion of another party to the arbitration agreement, stay the proceeding.”

Ontario courts have held that the language of section 7(1) of the Arbitrations Act, 1991 is mandatory and requires the court to stay a proceeding when there is an agreement to arbitrate and the dispute is properly within the mandate of the arbitrator. It is for the arbitrator to determine in the first instance whether a matter in dispute is subject to arbitration.

The court may refuse to stay the proceeding in the following cases: (1) a party entered into the arbitration agreement while under a legal incapacity; (2) the arbitration agreement is not valid; (3) the subject-matter of the dispute is not capable of being the subject of arbitration under Ontario law; (4) the motion was brought with undue delay; and (5) the matter is a proper one for default or summary judgement.

With respect to (3), certain rights under the Employment Standards Act cannot be made subject to arbitration.

How can employers make changes to existing employment agreements?

Any amendment or renegotiation of the employment agreement must usually be agreed to by both parties and must be founded upon new consideration. An employee can make unilateral changes to certain terms of employment if that is permitted under the contract of employment or with sufficient notice of the proposed change to the employee. Continued employment is not valid consideration for a mutually agreed variation. If a material change to an employment agreement is made unilaterally, without reasonable notice and the employee does not consent, the employee may bring an action for constructive dismissal or claim damages for breach of contract.

DISCLAIMER:  This publication is for information purposes only and its provision does not form a lawyer-client relationship or constitute legal advice. Employment law is a constantly evolving field, so you should contact a Dickinson Wright LLP employment lawyer to obtain  advice with respect to any particular legal issue or problem.

Eric Kay

I look after clients who have been fired and companies who want to terminate employees. I also go to court for commercial disputes.
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