IDEL can prevent disguised dismissal requests in common law: Coutinho V. Ocular Health was it badly decided? – Employment and HR



Canada: IDEL can prevent disguised dismissal requests in common law: Coutinho V. Ocular Health was it badly decided?

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We recently reported on the Ontario Superior Court decision in Coutinho v. Eye health, which ruled that an employee who had been “temporarily laid off” due to the COVID-19 pandemic, and deemed to be on emergency infectious disease leave, had been fired in disguise at common law. Check out our May 14, 2021 update, IDEL is not preventing employees from claiming constructive dismissal.

Three weeks later, the Court of Taylor v. Hanley Hospitality judged that Coutinho was badly decided and should not be followed.

In Taylor, the Court determined that the government promulgated Ontario Regulation 228/20: Emergency Infectious Disease Leave (IDEL) supersedes the common law. Thus, when an employee is temporarily laid off under the IDEL, this temporary layoff does not constitute a dismissal under the Employment Standards Act (ESA) nor does it constitute constructive dismissal at common law. The Court held that, in order to apply the interpretation advanced in Coutinho would render IDEL meaningless, which “violates the rules of statutory interpretation”.

As previously reported, under IDEL, an employee is deemed to be on “emergency infectious disease leave” when:

  1. the employee is not represented by a union;
  2. the employer temporarily reduces or suppresses the employee’s working hours and / or wages for reasons related to COVID-19; and
  3. the reduction or temporary elimination takes place during the “COVID-19 period” as defined in IDEL.

IDEL specifies in particular that a reduction or elimination of the hours and wages of a non-unionized employee for reasons related to COVID-19 (1) does not constitute a layoff within the meaning of the ESA, and (2) does not constitute constructive dismissal.

It remains to be seen how the two cases will be reconciled and whether one or both decisions will be reviewed by the Ontario Court of Appeal.

For information on this development in case law, please contact any member of our Employment and Labor group.

The content of this article does not constitute legal advice and should not be relied on in this manner. Specific advice should be sought regarding your particular situation.

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