Addressing the Deemed Termination and Severance Employment Standards Provisions in Saskatchewan

In response to the COVID-19 pandemic the Government of Saskatchewan has enacted a number of amendments to The Employment Standards Regulations (the “Regulations”).

This blog provides a summary of some of the more important amendments that relate to layoff and recall requirements and the potential to avoid the deemed termination provisions of the Regulations, which trigger statutory severance to be paid.

These amendments are intended to create a balance between employer and employee interests where the decision is made to lay off employees during a “public emergency period”.

The Regulations define a public emergency period as occurring in one of two situations: first, if an emergency declaration is made under The Emergency Planning Act; and second, if the Chief Medical Health Officer makes an order that a disease poses a serious public health risk in Saskatchewan and that individuals must take measures to isolate themselves to prevent spread of that disease.

First Amendment

On March 20, 2020 the Government of Saskatchewan enacted the first set of layoff amendments to the Regulations (the “First Amendment”).

In the event that a public emergency period exists, the First Amendment provided that an employer would not have to provide notice or pay in lieu of notice of layoff as otherwise required under The Saskatchewan Employment Act (the “Act”) when they laid off employees for a period of 12 weeks or less in a 16-week period.

However, if an employer laid off employees periodically for a total of more than 12 weeks in a 16-week period, the employees were deemed to be terminated and are entitled to pay instead of notice as outlined in the Act. The notice calculation was to be made from the date on which the employee was laid off.

Second Amendment

On May 22, 2020 the Government of Saskatchewan published the second set of layoff amendments to the Regulations (the “Second Amendment”).

The Second Amendment removed the above-described 12-week cap on layoffs. Instead, the Second Amendment establishes that during the entirety of a public emergency period employers and employees are exempt from the provisions of – and employees are not entitled to rely upon – the layoff provisions of the Act.

Further, Saskatchewan employers and employees now continue to be exempt from the layoff provisions of the Act for an additional two weeks from the date on which the public emergency period is no longer in force.

However, by the end of that two-week period the employer must schedule any laid-off employees back to work. If any employees have not been scheduled back to work at the end of the two-week period, those employees are deemed to have been terminated and are entitled to pay in lieu of notice to be calculated from the original date on which the employer laid off the employees.

If any employees have been scheduled to work with the employer but do not return to work, those employees are deemed to have resigned.

It is not yet clear what effect the above-described amendments will have on common law, contractual or collective bargaining entitlements in relation to layoffs.

Many employers may not be able to return all employees to work within two weeks from when the public emergency period is no longer in force and may be subject to significant severance costs when they can least afford them. Those employers should proactively seek legal advice. Options are available in both union and non-union workplaces to avoid or delay the deemed termination provisions in the Regulations and the related severance costs. Each situation needs to be assessed on its own facts.

The MLT Aikins labour and employment team will continue to monitor the situation and provide additional updates on legal issues that may impact employers. In the meantime, please do not hesitate to reach out to our team if you require assistance in getting your organization prepared for addressing the operational impacts of COVID-19.

Note: This article is of a general nature only and is not exhaustive of all possible legal rights or remedies. In addition, laws may change over time and should be interpreted only in the context of particular circumstances such that these materials are not intended to be relied upon or taken as legal advice or opinion. Readers should consult a legal professional for specific advice in any particular situation.