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    Canadian Employment Law for Retail Businesses – Updated 2022


    Canadian employment law for retail businesses is relatively straightforward; there are a few key points that business owners and managers should be aware of. This article examines Canadian employment law essentials for the retail sector. In addition, it provides an updated 2022 guide to help you stay compliant. So whether you’re just starting in the retail world or you’ve been operating your business for years, make sure you know what’s expected of you by reading this article.

    Legal Jurisdictions In Canada

    The Canadian constitution provides for fourteen legal jurisdictions in Canada: federal, ten provincials, and three territorial, each having its own employment standards act, human rights code, and occupational health and safety legislation. The laws are similar but differ in detail due to regional economic and social needs. 

    Canadian Labour Code & Provincial/Territorial Labour Standards Law

    Approximately 6% of the Canadian workforce falls under the Canadian labour code and the OH&S jurisdiction of the federal government. The remaining 94% of Canadian workers are covered by provincial or territorial legislation. 

    Employment Law Canada

    The majority of the Canadian labour force is regulated by provincial legislation. Thus, most employees would contact their respective provincial or territorial labour board or agency regarding labour or health and safety issues. Similarly, the Canadian labour code covers federally regulated businesses, crown agencies, and corporations across Canada, regardless of location.

    The Nature of Employment Standards Law

    Employment standards law protects employees from receiving less than the minimum legal protection required under labour law. Labour standards legislation covers:

    • Hours of Work & Scheduling
    • Wages, Overtime, severance pay, and termination entitlements
    • Minimum Wage, minimum wages
    • Equal Pay for Equal Work
    • Pregnancy and Parental Leave
    • Leaves of Absence
    • Benefit Plans
    • Public Holidays
    • Vacation Time and Pay
    • Termination, reasonable notice, and Severance of Employment
    • Temporary Layoffs
    • Liabilities
    • Complaints and Enforcement
    • Offenses and Prosecution
    • Temporary Help Agencies

    It is important to note that it is within the employer’s power to provide the employee with more than the minimum standard prescribed by employment standard laws.

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    Employment Contracts in Canada

    There are four main types of employment contracts businesses use: permanent, fixed-term, casual, and zero-hour. The contract you receive is based on your employment status and must be agreed upon with the employer to ensure both parties accept the terms.

    For example, in Canada, zero-hour and casual labour contracts can have “no guaranteed minimum hours” and place “no obligation on the employer to provide work.” Instead, the pay can be “pro-rated in line with hours worked.”

    In order for an employment contract to be enforceable, it must fulfill the essential elements of a binding agreement in common Law and may not contravene any applicable legislation. A binding contract must include three components: offer, consideration, and acceptance. 

    Labour Standards & Collective Agreements

    Collective agreements (aka collective bargaining agreements) are contracts between the employer and a trade union that outlines many of the conditions of employment for workers in a bargaining unit. The terms and conditions are reached through collective bargaining between the employer and the union.

    Note: The employment relationship between labour and management is considerably altered when collective agreements come into force. Even so, most retail work environments are not impacted by unionisation.

    What happens when collective agreements come into force?

    Once a collective agreement is in place, it replaces the territorial, provincial, or federal employment standards legislation. However, collective agreements cannot provide less protection than the minimum defined by employment standards law. In addition, employee grievances are directed toward the union and management rather than the labour relations board of a province, territory, or federal labour agency.

    What is a Labour Union?

    A labour union is an organization of workers formed to advance its members’ interests concerning wages, benefits, and working conditions members of a labor union with job protection under a collective bargaining agreement with the employer.

    Unionisation and Labour Relations Acts

    Labour relations Act regulates the organisational rights of unions. At the same time, it promotes and facilitates collective bargaining at the workplace and sectoral levels. It also deals with strikes and lockouts, workplace forums, and alternative dispute resolution.

    Collective Bargaining Coverage in Canada

    In 2021, 31% of Canadian employees were covered by collective bargaining agreements. Coverage by a union agreement was about five times higher among employees in the public sector (77.2%) than among employees in the private sector (15.3%). Overall, the collective bargaining coverage rate followed a downward trend from 1997 to 2021, almost entirely due to a decline in coverage in the private sector.

    Occupational Health & Safety legislation

    Occupational health and safety (OH&S) legislation in each jurisdiction outlines the rights and responsibilities of the employer, supervisors, and the worker through an Act or statute and related regulations. Regulations made under an Act define the application and enforcement of an Act. 

    The Purpose & Importance of OH&S Law

    The primary purpose of occupational health and safety law is to protect workers from health and safety hazards in the workplace. It sets out the duties, rights, and responsibilities of all workplace parties, including employees, management, and unions.

    Occupational Health & Safety Procedures

    It establishes procedures for workplace hazards and provides for enforcement of the Law where compliance has not been achieved voluntarily. Under the Occupational Health and Safety law, small business have many of the same responsibilities as any other employer, including:

    • the responsibility to reasonably protect their workers within their employ
    • informing, instructing and supervising workers to protect their health and safety
    • to ensure that every worker and supervisor recieves the required training, including essential occupational health and safety awareness training
    • have a duty to make employees aware of possible dangers in the workplace

    Occupational Health and Safety Policy & Communication

    Companies must comply with Occupational health and safety laws by communicating and promoting them in the workplace. Moreover, the promotional requirements depend on the size of the company and the jurisdiction requirements. For instance, the Law (may) require:

    • Writing and maintaining workplace policies – an organisation that regularly employs six or more workers must post health and safety, violence, and harassment policies and make them available to your workers
    • Creating a program to implement the policies
    • Reviewing policies annually
    • Offering mandatory health and safety awareness training – By Law, all workers and supervisors must take essential occupational health and safety awareness training. This helps them understand their health and safety rights and meet their responsibilities. There are plenty of online resources to help you with this training.
    • Selecting a health and safety representative or create a joint health and safety committee – JHSC – (over 20 employees) – Under the Occupational Health and Safety Act, workers and employers must work together to keep the workplace healthy and safe. One way to do this is by working with your workplace health and safety representative or your joint health and safety committee.
    • Certifying at least one worker representative and one management representative on the JHSC must be certified. To do that, they must take a 2-part training program, approved by the Ministry of Labour, Training and Skills Development’s Chief Prevention Officer. 

    Note: It is important to remember that legal requirements differ depending on the jurisdiction. 

    Workplace Hazardous Materials Information System (WHMIS)

    The Workplace Hazardous Materials Information System (WHMIS) is Canada’s national hazard communication standard. The critical elements of the system are hazard classification, cautionary labeling of containers, the provision of (material) safety data sheets ((M)SDSs), and worker education and training programs.

    • WHMIS aims to educate and train workers on the hazards and safe use of products in the workplace. WHMIS mandates that hazardous products are correctly labeled and that employers prepare workplace labels as needed.
    • The goal of WHMIS is to reduce injury and disease by communicating specific health and safety information about hazardous products to workers.

    Note: WHMIS covers all jurisdictions in Canada and is an extension of occupational health and safety law.

    Employment Equity Law

    The purpose of the Law is to achieve equality in the workplace, so employment opportunities are not denied for reasons unrelated to ability. Further, the law works to correct disadvantages in employment experienced by women, aboriginal people, people with disabilities, and members of visible minorities. (IE: employment equity act is a federal law)

    The Principle of Employment Equity

    The law reinforces the principle that employment equity requires special actions and measures are taken to accommodate differences in workplace equality. For example, the Canadian Human Rights Commission (CHRC) is responsible for enforcing the Act in the federal jurisdiction. Additionally, provinces have their own human rights boards, agencies, and commissions.

    The law mandates scheduled audits to ensure that employers comply with the Law and pursue implementing their employment equity plans. Although, for instance, the CHRC primarily uses dialogue and persuasion to get employers to commit to Employment Equity, it can also request that they sign written undertakings.

    Example of Enforcement

    The CHRC is also empowered to prosecute non-complying employers by referring their cases before the Employment Equity Review Tribunal created under the EEA. 

    Human Rights Law & the Charter of Rights and Freedoms

    Canadians are protected under the Canadian and provincial human rights acts and provincial charters. Under the rules set out by the governing laws, businesses must ensure that all those interacting with the company are treated equally regardless of race, religion, etc.

    Human Rights Legislation & Labour Regulation

    Employees are guaranteed workplace rights; a safe working environment, the right to fair remuneration and equal pay for equal work, the right to organise and participate in collective bargaining, and the right to be protected from forced labour and trafficking. In addition, workers have these rights specific to Health & Safety:

    • The right to know about hazards in the workplace.
    • The right to participate in OH&S activities.
    • The right to refuse unsafe work.
    • The right to no retaliation (discipline or being fired) for raising OH&S concerns.

    Note: Human Rights & Freedoms are protected under the Charter of Rights and Freedoms, federal, provincial, and territorial law. (civil code)

    Provincial Standards & employment laws

    Territorial Standards & employment laws

    As a business owner in the retail sector, it’s crucial to stay up-to-date on the latest changes to Canadian employment law. Knowing and abiding by the rules can avoid costly fines and lawsuits. This guide will help you do that, so bookmark it and check back often. Thanks for reading!

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