What Happens With Short Term Lay Offs
In any economic environment, situations arise causing employers to temporarily decrease the number of employees on payroll. Legally, we refer to these temporary reductions in an employer’s workforce as temporary layoffs. Alberta law sets out the rights and obligations of both employees and employers when this happens. If you have questions, the employment lawyers at Kahane Law Office assist employers and employees with respect to layoff law in Alberta. Offices in Calgary and Edmonton make it easy to get the help when you need it.
Please Note: the following is specific to employment situations with no collective bargaining agreements. Unionized positions often have specific rules with respect to temporary layoffs.
What Is A Layoff?
Under the Employment Standards Code an employer has the option to stop paying an employee to come in to work while maintaining the employment relationship with that employee, without firing them. As below, the temporary layoff is a short term provision aimed to help an employer stay in business in situations where there is a temporary over staffing situation.
Why The Law Allows Short Term Lay Offs
Many situations exist for employers where they require a short term reduction in workforce. A variety of situations lead to this. For example, the following are examples of reasons for the need for a short term reduction in employees:
- Annual or seasonal maintenance of employment equipment;
- Seasonal nature of work (i.e. Inability to work in the coldest winter months);
- A fire or other situation where the work environment is unworkable;
- Seasonal or unexpected temporary loss or reduction in business;
- Corporate restructuring; and lastly
- Mergers, acquisitions, buyouts or relocations of the business.
Notice Requirements For A Layoff
People often ask about how much notice is required for a temporary layoff. In Alberta, Notice provisions provide for the following notice requirements.
- At least one week for any employee who worked for the company for up to two years;
- A minimum of at least two weeks for employees who worked for the company for two years or longer.
Further, the law provides for situations where an employer cannot practically give that much notice. In these situations, the law calls for the employer to give as much notice as possible given the situation.
How To Give Temporary Layoff Notice
Proper notice of a temporary layoff is extremely important. Failing to give notice in the exact manner required under the law allows the employee to argue a termination took place. In this case, employers risk wrongful dismissal or constructive dismissal awards to the employee.
Proper temporary layoff notice consists of several aspects. For example, an employer needs to give notice:
- In a form that includes Sections 62, 63 and 64 of the Alberta Employment Standards Code;
- In writing;
- States that the notice is a temporary layoff notice;
- What the effective date of it is; and lastly
- Include all other relevant information as required by the regulations.
What Happens If You Are Laid Off?
If you receive layoff notice, it is important to review that notice immediately. Next, if the notice fails to meet the standards as set out above, email our team to learn your rights. Lastly, if you received proper notice, you do not go to work. You have the ability to apply for Employment Insurance benefits. As set out below, once you receive a recall notice, the requirement is to return to work.
Is Severance Pay Paid If Due To A Temporary Layoff?
The quick answer is no. As long as the temporary layoff is shorter than the time allowed under law, no severance or termination pay is owed to an employee. As above, this also assumes the proper giving of notice. After the maximum number of days allowed, the employer needs to give notice, termination or severance pay.
How Long A Temporarily Layoff Can Last In Alberta
The rules in Alberta shifted in light of Covid-19. Therefore, to comply with legislation, a maximum layoff is:
- A cumulative of 60 days layoff out of any total 120 day period if before March 17, 2020;
- 120 consecutive days layoff if between March 17, 2020 and June 17, 2020;
- A cumulative of 90 days layoff out of any total 120 day period if after June 17, 2020.
NOTE: Special provisions exist for layoffs specifically related to Covid-19. These allow for 180 (consecutive) days.
Extending A Lay Off
An employer may extend a lay off. To do so, the company needs to make regular payments to the employee. For example, the employer must pay salary or wages, benefits and pensions. In addition, the employee must agree to this. In these situations, the employee does not attend work but the employer / employee relationship is maintained.
The process for recalling an employee is equally important to the process of commencing their lay off. A recall must be both in writing and state that the person must return to work with seven days of serving the notice on the employee. Service of these notices include several specific rules. For example, the law permits service of the notice by:
- Sending the notice by email or fax;
- Mailing the notice by regular or registered mail;
- Handing the notice personally either at the persons address or at work; and lastly
- Leaving the notice with a person appearing at least 18 years old at the employee’s address.
Employees Who Fail To Return To Work After Receiving A Recall Notice
If an employee fails to return to work inside of the 7 days’ notice outlined in the recall, they face termination. In these situations, termination is for cause meaning that no requirement to pay termination notice or severance pay exists.
Getting Help From Alberta Temporary Layoff Lawyers
Employers looking to temporarily reduce their workforce, or employees who face a temporary loss of work, often need legal help. Our Calgary and Edmonton office provide help when needed. To make things easier, we offer in person, telephone and video consultations in Alberta. For the fastest service, please email our office with a brief outline of your situation. This allows us to provide you with feedback, information and / or the ability to set up a meeting with the appropriate lawyer. Please email us at at this email address directly. Alternatively, please feel free to call us at 1-877-225-8817 from anywhere in Alberta