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With the province of Ontario’s announcement that it will hire 175 Employment Standards Officers by 2020, employers can expect more payroll audits in the coming years, and financial penalties for noncompliance to the new employment standards.
It turns out that the Fair Workplaces Act (Bill148) is about a whole lot more than a minimum wage increase. In fact, many of the agencies I work with will not be directly impacted by the wage increase at all, but there are a slew of other changes that will have significant budgetary and operational ramifications. Social and community services agencies need to ensure they are well informed about this legislation before it comes into effect in 2018.
I strongly recommend fully reading through the proposed changes to the standards (see link above), but I’ve pulled out a few of the notable amendments for discussion in this article.
Regardless of whether an employee is full time, part time, temp or casual, employees will be entitled to the same pay rate for the same job. Employers will need to be able to objectively justify their employee’s pay rates.
Recommendation: A step and grid framework for progression as well as regular performance reviews will be necessary in order to document and justify differentials in employee wages.
In line with the idea of ‘same wage for same work,’ all staff will be entitled to an increase in vacation pay (to 6%/3 weeks) with seniority. This means that seniority will need to be tracked for all employees regardless of classification.
Recommendation: Integration between your payroll and HR systems, or a position-based payroll system, is helpful in terms of managing seniority and the associated entitlement calculations.
Bill 148 sees an increase in the acceptable window for shift cancellations from 24-48 hours. Employees must be paid their full wages for shifts cancelled within 48 hours of their scheduled work. Additionally, on call employees who are ‘called in’ must be paid for a minimum of 3 hours of work at their standard rate.
Recommendation: Keeping record of all scheduling activities and changes to the schedule, including the date and time shifts are accepted, or cancelled, will be critical in terms of avoiding penalties when this legislation comes into effect. Employers will also need to demonstrate that employees are being paid at the appropriate pay rate for the shift.
While this may have less of a budgetary impact than the other changes, employers will need to track new kinds of unpaid leaves, as well extend existing leave entitlements (i.e. parental leave goes to 18 months).
Recommendation: Ensure that your HRIS is setup to manage these new kinds of leave.
In the nonprofit sector, I believe that most leaders are on board with the overall sentiment of this new legislation. Of course, the challenge is that these changes will increase costs, and are currently unfunded. Agencies will likely need to find management efficiencies to recoup their costs. I believe that now, more than ever, social services agencies need to be evaluating the effectiveness of their IT systems and their business processes to maximize impact for dollars.
While at the recent ONN Driven Conference, I attended a session on this topic and they shared a great template that organizations can use to assess which areas of the Bill will affect them the most.
Bill 148 is progress in terms of workplace fairness, but it will have a financial impact on many nonprofit organizations. The fear is that Bill 148 will increase costs for all agencies, and therefore indirectly decrease the agency based supports available to the people you serve. We don’t want to see this happen. That’s why we hosted a webinar with Schible Law to dive deeper into the specific areas social services will be impacted most.
Our goal for this webinar is to provide agencies with the critical information they need to asses the direct and indirect financial implications, understand the HR/Payroll system requirements and find ways to create efficiency to circumvent the new inflated payroll costs.