Open for Business Act: What It Means for Alberta Employers

BACKGROUND

On April 16, 2019, the United Conservative Party (UCP) won Alberta’s provincial election and went on to form a majority government. Several of the UCP’s campaign promises involved reversing changes made to Alberta’s employment and labour laws by its former New Democratic Party (NDP) government. As a result, one of the UCP's first orders of business has been to table Bill 2, Open for Business Act (Bill 2) and amend the Employment Standards Regulation (ESR) by way of Order in Council.

Bill 2 passed its first reading at the Legislative Assembly of Alberta on May 27, 2019, and may be revised in subsequent readings before it comes into force. The amendment to the ESR comes into force as it is currently drafted on June 26, 2019.

BILL 2’S AMENDMENTS

As currently drafted, Bill 2 proposes to make the following noteworthy changes to Alberta's Employment Standards Code (ESC) and Labour Relations Code (LRC).

Employment Standards Code Amendments

Banked Overtime: Employers will be able to provide employees with one hour of paid time off for each hour of overtime worked. Such change is a reversion to the banked overtime rule that was in force prior to the NDP government amending the ESC in 2018 to require that employees be provided with at least 1.5 hours of paid time off for each hour of overtime worked.

General Holiday Pay Eligibility: The requirement for an employee to have worked for 30 days in the 12 months preceding a general holiday to be eligible to receive general holiday pay will be reinstated. As a result, employees will not be eligible for general holiday pay immediately upon commencing employment.

Calculation of General Holiday Pay: The distinction between regular and non-regular days of work for calculating general holiday pay will be reinstated. Reinstating such a distinction will mean that the general holiday must fall on a day the employee would have normally worked in order to receive general holiday pay. For an employee working an irregular schedule, he or she must have worked at least five out of the last nine days on which the general holiday falls to receive general holiday pay (e.g., five of the last nine Mondays if the general holiday falls on a Monday).

Labour Relations Code Amendment

Union Certification: The LRC's mandatory secret ballot procedure for the certification of new trade unions would be restored. As a result, the hybrid “card-check” system introduced by Alberta’s former NDP government that allows new trade unions to be certified without a vote if they have the support of 65 per cent or more workers (as shown by workers submitting applications for membership or being members in good standing) would cease to apply. There would also be a return to a 90-day period for unions to provide evidence of employee support by way of applications for membership, a significant decrease from the current six-month period.

AMENDMENT TO THE ESR

Youth Minimum Wage Rate: The amendment to the ESR introduces a C$13/hour minimum wage rate for employees who are 17 years of age or under and enrolled in an educational institution. Such reduced minimum wage rate will apply to work performed by employees during a school break or for the first 28 hours in a work week for work performed other than during a school break for the employee. The UCP has stated that the addition of a lower wage rate for employees under the age of 17 is to encourage employers to hire young people for minimum wage work.

IMPLICATIONS

The amendments to Bill 2 may be revised following additional readings before the Legislative Assembly of Alberta and do not come into force until Bill 2 receives royal assent. However, as it is currently drafted, Bill 2’s reversion to prior rules relating to banked overtime, general holiday pay and union certification can all be viewed as changes that may reduce the cost of doing business for employers in Alberta. The amendments to the ESC’s general holiday pay rules are likely to be of interest to employers with workforces that have fluctuating schedules, such as the restaurant industry.  

Similarly, the introduction of a youth minimum wage rate into the ESR may reduce the cost of doing business for employers in Alberta, particularly those who currently rely on employees under the age of 17. Unlike the proposed amendments in Bill 2, however, the amendment to the ESR was made by Order in Council and, as a result, will be coming into force as currently drafted on June 26, 2019.

For further information, please contact:

Birch Miller                  403-260-9613

Laura Dunnigan          403-260-9709     

any other member of our Employment & Labour group.