Flexible work and vacation: pandemic employment and labour considerations

To help prevent the spread of COVID-19, many businesses have been forced to close or reduce the number of workers at their physical locations to ensure social distancing protocols are met.

As a result, businesses are looking for ways to support the health and safety of their workforce and abide by social distancing protocols, while continuing to operate to the fullest degree possible. Flexible work arrangements, such as permitting employees to work remotely or adopting flexible work schedules, are one solution to this issue. For many businesses, flexible working can be implemented with minimal interruption to business operations. 

However, other employers may have concerns about implementing flexible work and the impact it will have on productivity and business demands. Others may simply be unable to accommodate remote working arrangements and may need to implement layoffs or permit employees to take an unpaid leave of absence during this time. 

In these cases, employers may be worried that their employees will wait until business operations resume and social distancing orders are lifted to take their annual vacation. To avoid this situation, employers may be wondering whether they can require their employees to take vacation now rather than later in the year, or alternatively, require employees to postpone vacation. 

To help employers navigate these issues we have answered some common questions regarding vacation entitlements and flexible work arrangements. This legal update focuses on the law in Ontario, British Columbia, Alberta, Quebec, as well as the federal sphere. This update is intended to provide a high-level overview of issues concerning adjustments in the workforce. As always, we encourage employers to obtain legal advice before making any changes to operational policies and practices.

Scheduling vacation: what employers need to know

Can employers unilaterally schedule employee vacation time?

• Short answer: Yes, employers generally have the discretion to schedule their employees’ vacation, subject to applicable employment standards legislation requirements and terms in existing employment contracts or collective agreements. 
  
  
• There are certain conditions in employment standards legislation that must be met to unilaterally schedule employee vacation time. For instance, a number of provinces require employers to provide notice to employees before requiring employees to take vacation. In Quebec, for example, employers must provide four weeks’ notice of unilaterally scheduled vacation dates. In Alberta, employers and employees should attempt to agree on employee vacation dates. Where an employer cannot approve requested dates, the employer must provide two weeks’ written notice to the employee of the employee’s scheduled vacation. 
  
  
• Many jurisdictions, such as Ontario and British Columba, require vacation entitlements be taken in unbroken periods of at least one week, unless the employee requests otherwise. In Alberta, employees are entitled to take their vacation in an unbroken period of two or three weeks (depending on length of service), unless employees request shorter increments of at least a half-day each. In Quebec, statutory vacation entitlements must be taken in one unbroken period, unless the employee requests shorter increments, which employers can allow at their discretion.
  
  
• All Canadian jurisdictions have deadlines for when vacation must be taken. In Ontario and at the federal level, employees must take vacation no later than 10 months immediately following the completion of the vacation entitlement year. In British Columbia, Quebec and Alberta, vacation must be taken within 12 months of the year in which it is earned. 

Can an employer unilaterally cancel or modify pre-approved vacation? 

• Short answer: As a best practice, employers may wish to allow employees who have pre-booked and approved vacation to take that vacation as scheduled.
  
  
• In some jurisdictions, employers would be wise to exempt employees who have pre-booked vacation because reneging on a previously approved vacation date would constitute a technical breach of employment standards laws, such as in Alberta.
  
  
• Moreover, if the employer unilaterally cancels or modifies pre-approved vacation, there is a risk that the employee may make a claim for monetary loss as a result of the vacation change. In some jurisdictions, employment standards legislation specifically requires employers to reimburse employees for any monetary loss suffered as a result of employer-mandated cancellation or postponement of previously approved vacation, such as in Saskatchewan. 

Can the employer require an employee to forgo vacation entitlements or take a shorter vacation than taken in previous years?

• Short answer: Depending on the circumstances, yes, but this approach is not without risk.
  
  
• Employment standards legislation sets out the minimum annual vacation entitlements that must be provided to employees. At the very least, employers must ensure employees receive these minimum entitlements.
  
  
• It should be noted that employment standards legislation in some provinces (e.g., British Columbia), expressly provides that employers must not reduce employees annual vacation or vacation pay because the employee was paid a bonus or sick pay or because the employee was previously given a longer annual vacation than the minimum required.
  
  
• Where employers offer vacation entitlements exceeding the statutory minimums, employers could reduce entitlements to the statutory minimums. However, there is a risk that doing so could trigger constructive dismissal claims.

Can employers offer employees the option of using their vacation entitlements if they are self-isolating or in quarantine?

• Short answer: Yes.
  
  
• A number of jurisdictions have enacted legislation providing for unpaid leave during periods where employees must self-isolate or quarantine. However, if an employee wishes to receive compensation during that period, employers could let employees use their vacation entitlements instead of taking an unpaid leave of absence. This should be presented as an option to employees, not as a mandatory requirement imposed by the employer.

Flexible work: why it matters

In a nutshell, flexible work usually entails modifying or relaxing an employee’s terms and conditions of employment to promote a culture of work-life balance, or allow an employee to work on an accommodated basis. Examples include allowing employees to work from home; under modified hours of work; or with reduced hours of work. For employers still operating, flexible work can be an attractive option for the following reasons:

• Flexible work as a measure of accommodation: Under human rights legislation across the country, employers are prohibited from discriminating against employees on the basis of the protected grounds, and are obligated to accommodate their employees until the point of undue hardship. 
  
  
• Flexible work as an employment standards entitlement: Furthermore, federally regulated employers should know that their employees enjoy a right to request flexible work arrangements. Under the new provisions of the Canada Labour Code introduced in September of 2019, employees with at least six months of service can request flexible work arrangements relating to their hours of work, work schedule, or work location. An employer can only refuse, in full or in part, these requests on the basis of a narrow list of reasons set out in the Code, such as additional costs that would be a burden on the employer, insufficient available work, and negative impact on the quality/quantity of work. This can be a difficult exercise for employers, as employees are not required to provide reasons for requesting a flexible work arrangement. 
  
  
• Flexible work as a measure to protect health and safety: Flexible work can also work as a measure to protect health and safety. For instance, allowing employees to work remotely can reduce the risk of transmission in the traditional workplace. 
  
  
• Flexible work as a measure for employee retention: Even employers who are not statutorily required to consider flexible work arrangements for their employees could still benefit from doing so, especially in these times. In fact, offering flexible work arrangements can be an important measure to promote employee retention and even attract talent by accommodating a variety of lifestyles. And, as mentioned, especially during the current pandemic, flexible work arrangements can be essential to maintaining continuous business operations safely and healthily.

Take-aways

• Employers generally have the right to schedule employee vacation subject to statutory limitations and restrictions in employment contracts and collective agreements. 
  
  
• Employers could require employees to take vacation within a set timeframe to address operational challenges posed by social distancing requirements. 
  
  
• Although employers generally can unilaterally schedule vacation, doing so could have an impact on morale and result in constructive dismissal or other claims depending on the circumstances. Employers should take care to ensure any decision made is in keeping with statutory and other obligations. 
  
  
• Any decisions made regarding employee vacation schedules should be clearly communicated to employees. Ideally, employers will provide notice to their employees and explain the reasons for scheduling decisions. This will mitigate risk and help reduce impacts on morale.
  
  
• Finally, as discussed above, flexible work arrangements are a useful tool to address impacts on business operations, while ensuring the health and safety of the workforce.

The authors wish to thank Kayla Quintal, articling student, for her assistance in preparing this legal update