Layoff Rights for Employees When Production is Disrupted

The Ambassador Bridge, one of Canada’s main trading routes with the United States, was shut down for an extended period of time due to week-long protests.

Protests extended to the Peace Bridge, the bridge that connects Fort Erie, Ontario with Buffalo, New York before the bridge reopened earlier this week after a weeklong shutdown.

The shutdown had an economic impact on many industries and resulted in temporary layoffs of some workers. It affected many major industries that rely on goods being exported through the Ambassador Bridge.

One of the industries being severely affected is the auto industry, where many manufacturers sent workers home or halted production entirely as a result of the parts supply shortage.

Many of these plants suspended production temporarily, but have warned of further production delays, more layoffs, and potentially, more reduced hours for workers.

What is a temporary layoff?

A temporary layoff happens when an employer significantly reduces or stops an employee’s work without severing the employment relationship.

The employer may continue an employee’s benefits during this period of time. The company is expected to recall employees back to work after a certain period of time.

Does an employee have to accept a temporary layoff?

Unless the terms of the employment contract allow for a layoff, or you work in an industry where layoffs are a standard part of the job, an employer does not have an automatic right to place an employee on a temporary layoff — even if the layoff is the result of economic downturn.

An employee does not have to accept the layoff. They have the option of treating it as a termination, which allows them to pursue their severance package.

If you are unsure whether you can treat a temporary layoff as a termination, it is advisable you speak to one of our employment lawyers, who can review your contract and advise you of whether there are any terms in your employment contract that allow the layoff, advise you on how long your employer may keep you on a temporary layoff, and make you aware of any contract terms and conditions of which you should be aware.

WATCH: Employment lawyer Lior Samfiru discusses 5 facts you need to know about temporary layoffs on an episode of the Employment Law Show.

What happens if an employee does accept a temporary layoff?

An employee can consent to a temporary layoff even though it is not part of their terms of employment.

If you accept a temporary layoff and are eventually recalled to work, a temporary layoff may become a term of your employment contract.

This means that it may be legal for an employer to lay off an employee in the future and the employee would not be able to treat future layoffs as a termination.

What should an employee do if they’re terminated as a result of the disruptions to production?

If an employee is terminated because of a disruption affecting the business or production, they are still entitled to full severance. The amount of severance owed depends on a number of factors including the length of employment, age, and role.

If you are terminated and are unsure whether you have received the severance you are owed, you should seek legal advice and talk to one of our employment lawyers. As Canada’s most positively reviewed law firm, we can provide you with the advice you need, the compensation you deserve.