Previously back in April, the Government of Alberta allowed the extension of the temporary layoff provision from 60 days to 120 days. Given that the economy is just starting to move again, and that ending the temporary layoffs for 1000’s of employees and paying termination pay is not financially feasible, especially for hard-hit small businesses, the Government of Alberta introduced Bill 24, the COVID-19 Pandemic Response Statutes Amendment Act, 2020, which proposed amendments to various statutes, including the Code. Bill 24 passed third reading on June 25, 2020, and received Royal Assent on June 26, 2020.
As such, the temporary layoff period in Alberta has now been extended to 180 consecutive days for employees who are, or who have been, laid off for reasons related to COVID-19.
Effective June 18, 2020, employees who were already laid off at that time or who are subsequently laid off after that date “for reasons related to COVID-19” will not be deemed to be terminated until the 181st consecutive day of the employee’s layoff. Thus, an employer’s obligation to provide termination pay would not be triggered until the 181st consecutive day of the employee’s layoff if the employee is not recalled to work in accordance with the Code provisions.
Employers should still be careful with the use of temporary layoffs as there is still the potential risk of a constructive dismissal claim if they do not have a contractual right to temporarily layoff the employee, which should be currently embedded in the written employment contract with the employee. If no clause exists then the courts have said that a temporary layoff could be deemed to be a constructive dismissal resulting in wrongful dismissal damages for the employee.