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Employment & Labour, Real Estate

ESA changes will mean higher costs for condo corporations

Condominium corporations should start factoring increased labour costs into their budgets as amendments to Ontario's Employment Standards Act come into effect in the new year, says Toronto labour and employment lawyer John De Vellis.

Proposed changes to the Act include equal pay for part-timers who do the same work as full-timers with the same seniority; on-call provisions for employees; longer leaves for various purposes; and a higher minimum wage, says De Vellis, a partner with Shibley Righton LLP.

Those higher labour costs should now be in the minds of those who pen annual budgets for condos, he tells AdvocateDaily.com.

Bill 148, the Fair Workplaces, Better Jobs Act, which contains amendments to the Employment Standards Act, received royal assent on Nov. 27. Parts of the bill are already in force but most provisions will take effect on Jan. 1 and April 1. 

De Vellis says condominium corporations must budget for the proposed minimum wage increases — $14 an hour on Jan. 1, 2018, and $15 an hour on Jan. 1, 2019, followed by inflation adjustments.

There's also an Equal Pay for Equal Work provision, which gives part-time, casual, seasonal and temporary workers the same pay as full-time employees when they're doing substantially the same work — unless the difference in pay is due to a seniority or merit system, or one based on something other than gender or employment status. The equal-pay provisions come into force on April 1. 

Beginning on Jan. 1, 2019, employees who are on-call may have to be paid a minimum of three hours, even if they're not called to work. 

Other amendments include 10 days of emergency leave, of which two are paid, and three weeks of paid vacation for employees with five or more years of service. Parental leave would increase from 35 to 61 weeks for those taking pregnancy leave and from 37 to 63 weeks for those who don't.

The new provisions include up to 15 weeks of unpaid leave to receive medical or legal aid if the employee, or their child, experiences domestic or sexual violence or the threat of domestic or sexual violence. Family medical leave is also being extended to care for a dying family member — from eight weeks in a 26-week period to 27 weeks in a 52-week period.

As these increased costs are passed on to owners, it's almost certain that fees will increase, although the impact remains to be seen, De Vellis says.

The changes could be difficult for condo corporations to budget for, he says, because there are "so many moving parts. They will have to look at each item separately."

De Vellis suggests it may be wise to establish a contingency fund to cover any unforeseen or unexpected labour cost increases or “they will have to take a hard look at their employment situation and figure out what’s going to increase and then talk to their lawyers as they figure out what to do."

He says the legislation will be implemented in phases so the full financial impact won't be completely felt in the short term.

"Each employer's situation will be different depending on how many staff are below minimum wage, whether they have part-time and full-time staff who are paid differently, and whether they have people on call,” De Vellis says.

"Also, staff who are currently paid more than minimum wage may expect a bump-up once the minimum wage is increased," he says. "So there may be a ripple effect across the pay spectrum."

De Vellis says corporations that outsource property management will also have to consider higher fees as costs will sooner or later be passed on to them.

"Those costs are set by contract. It may be that in a competitive market, providers will hold the line for a while, but eventually, it's likely that higher labour costs will flow through," he says.

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