Employers Guide to Ontario Labour Laws

Payroll Management

Let's face it, as an employer it can be difficult to keep track of the large amount of ever changing Ontario Labour Laws. Even so, it’s important to have a firm grasp of these laws in order to protect yourself, and your employees. When it comes to Ontario labour laws, there’s actually a lot of room for error. From the logistics around overtime pay, to a breakdown of the many types of leaves of absence available to Ontarians, to wrongful dismissal, this guide packs a lot!

Below we highlight some of the important Ontario labour laws that all employers should be aware of, with some helpful tips to ensure you’re set up for success.

Here’s what we’ll be covering in this post:

  1. The Human Rights Code
  2. The Employment Standards Act
  3. The Common Law and Wrongful Dismissal
  4. Employment Insurance Act
  5. Occupational Health and Safety Act
  6. Workplace Safety & Insurance Act
  7. Pay Equity Act
  8. Ontario Labour Relations Act
  9. Privacy Legislation

The Human Rights Code

Everyone is entitled to basic human rights. This is especially important in the workplace as it’s the source of our livelihood—most employees are working often eight or more hours a day, five days a week.

The Human rights code ensures that we are granted those rights in all aspects of life including in the workplace. This code states that everyone has the right to equal treatment in the workplace, free from harassment or discrimination due to their:

  • Race
  • Ancestry
  • Colour
  • Place of origin
  • Ethnic origin
  • Citizenship
  • Creed
  • Sex
  • Sexual orientation
  • Gender Identity
  • Gender expression
  • Age
  • Record of offences
  • Marital status
  • Family status
  • Disability

The aforementioned “equal treatment” in the workplace refers to all aspects of the workplace environment and employment relationships—this includes:

  • Job applications
  • Recruitment
  • Training
  • Transfers
  • Promotions
  • Apprenticeship terms
  • Dismissal
  • Layoffs
  • Rate of pay
  • Overtime
  • Hours of work
  • Holidays
  • Benefits
  • Shift Work
  • Discipline
  • Performance evaluations

The Employment Standards Act

This act outlines the rights and responsibilities of both you, the employer, and your employees. For most all employees it provides the minimum employment standards in Ontario.

Outlined below, are some of the topics covered in this act. For more details checkout this great resource at

Payment of Wages

As an employer you must set up recurring payment periods and a recurring date of payment for your employees. You must also ensure that all earned wages besides the employees accruing vacation pay is paid out to them before the end of the pay day.


Along with an employees personal information like their name, address, date of birth (if under the age of 18), and date their employment began, Employers must also keep a record of the numbers of hours worked in each day and each week. If the employee has two or more regular rates of pay for their work, then the employees must keep record of the times that the employee worked in excess of the overtime threshold at those different rates of pay.

Hours of Work

The maximum hours that an employer may require an employee to work is 8 hours a day, or a total of 48 hours in a work week.

Employees must not work for 5 consecutive hours without having the opportunity to have a break period to eat. As an employer you must provide a 30 minute unpaid rest period to your employees to break and eat. This rest period must be given at such a time that the employee is not working for 5 consecutive hours.

For the most part, employees must receive 11 consecutive hours off from work each day. They should also receive at least 8 hours off between shifts (unless the two back to back shifts are a combined 13 hours or less).

Employers must provide one full day (24 consecutive hours) of rest for employers in a given work week.

In some exceptional circumstances employers can require their employees to work more and at times that would otherwise be free from work. Please see for more details.

Overtime Pay

When an employee works more that 44 hours in a work week, they are entitled to overtime pay. Overtime pay is also known as time and a half (1.5 times the employees regular pay).

For example an employee has a regular rate of $18.50 an hour, their overtime rate of pay will be $27.75 ($18.50 * 1.5 = $27.75). The employee must be paid this rate for every hour that is worked over the 44 hour threshold in a week.

It is important that employers keep clear and detailed records when paying employees overtime. This is important to have if there is ever a dispute or if there is a lawsuit in regards to overtime pay.

Overtime is calculated on either a weekly basis or over a longer period under an averaging agreement. The exception to this rule is if a contract of employment or a collective agreement states otherwise.

Minimum Wages

The Employments Standards Act requires that employers pay their employees at least minimum wage. Currently the general minimum wage is $14.00 an hour this is set to change October 1st, 2020. A list of the different minimum wage types and the values can be seen here.

Public Holidays

There are nine public holidays in Ontario:

  1. New Year's Day
  2. Family Day
  3. Good Friday
  4. Victoria Day
  5. Canada Day
  6. Labour Day
  7. Thanksgiving Day
  8. Christmas Day
  9. Boxing Day (December 26)

An employee who does not work on these public holidays is still entitled to their wages for that day. Alternatively, they can agree to work and be paid public holiday pay plus premium pay for all hours worked on the public holiday and not receive another day off (called a "substitute" holiday). Or, they can opt to be paid their regular wages for all hours worked on the public holiday and receive another substitute holiday for which they must be paid public holiday pay.

Paid Vacation

Employees are entitled to at least 2 weeks paid vacation per year under the Employments Standards Act. If the employee has five or more years experience their entitled vacation days per year will increase to 3 weeks. The vacation time earned over the course of a given year, must be taken within 10 months of that year's end.

When employees have been employed for less than 5 year, they must receive at least 4% of their gross earnings in their 52 week vacation entitlement period as vacation pay. If they have been employed for more than 5 years, then they must receive at least 6% of their wages in their 52 week entitlement period.

Leave of Absences

There are many types of absence leaves available to Ontario residents. Below we cover each type of leave, with information on the rules and regulations around each.

Pregnancy and Parental Leave

When an employee is pregnant and their expected delivery date is at least 13 weeks from their first date of employment, the employee is entitled to a leave of absence without pay called pregnancy leave.

The earliest that an employee is able to take their pregnancy leave is 17 weeks out from the due date. An exception to this rule is if the mother has a live birth more than 17 weeks before the due date. If this happens, then the employee is able to start their pregnancy leave on the date of birth. The latest that pregnancy leave can be taken is on the due date, or on the date the child is born if the birth date is earlier than the due date. The pregnancy leave will end seventeen weeks after the leave begins.

In addition, both new parents also have the ability to take a leave of absence without pay once their child is born - this is called parental leave. Just like pregnancy leave, employees must be employed for at least 13 weeks before taking said leave. Mothers who have taken pregnancy leave are entitled up to sixty-one weeks of parental leave. If pregnancy leave has not been taken, they are entitled up to sixty-three weeks of parental leave.

Usually when a birth mother takes pregnancy leave, they must begin parental leave as soon as it ends. However if circumstances arise that prevents the child from coming into the mother's care, such as it needing to remain hospitalized, the mother can opt to go back to work. She then has the option to start her parental leave anytime within 78 weeks of the birth, or the date the baby first came home from the hospital. Parents who are not the birth mother must also start their parental leave within 78 weeks of the birth or the date the baby comes home if they choose to take it.

In most cases, when an employee takes pregnancy or parental leave, they are entitled to returning to the same job that they originally had before the leave began, or if that job no longer exists, they must be given a comparable job. The employee returning from their leave must be paid the same amount they were earning before said leave began. If the wages for the employees job increased while they were on leave, or would have increased if not for going on leave, then they must be paid the higher wage upon their return.

While on parental or pregnancy leave employees retain the right to participate in their benefit plans. These benefit plans include: pension plans, life insurance plans, accidental death plans, extended health plans, and dental plans. As an employer, you must continue to pay your share of the benefit plans premium, unless the employee has notified you in writing that they will no longer continue to pay their portion of the premiums.

While on leave employees will continue to earn credits for length of employment, length of service and seniority. However if they have not passed their three month probationary period before going on leave, they will still have to complete their probation upon their return to work.

As an employer, you must not penalize employees because they: have taken, intend to take, are eligible to take, will be eligible to take, or have inquired about pregnancy or parental leave.

Sick Leave

Each year employees have the right to 3 days of sick leave. This leave is unpaid, and the employees job is protected. This leave is taken for personal illness, injury or medical emergency.

Bereavement Leave

When a death occurs to specific members of an employees family, they are entitled to two days of unpaid, job protected leave. This is called Bereavement leave. Employees are only eligible for this leave if the death occurs to specific family members—these members are: spouses, parents, step-parents, foster parents, children, step-children, foster children, grandparents, step-grandparents, grandchildren, step-grandchildren, spouse of the employee's child, brothers or sisters of the employee, and relatives of the employee who are dependent on the employee for care or assistance.

Family Responsibility Leave

Employees are entitled to three days of unpaid, job protected leave per year when certain family members suffer an injury, illness, medical emergence, or there is an urgent matter pertaining to said specific family members.

Family Caregiver Leave

Each calendar year employees are entitled to take 8 weeks of unpaid, job protected leave to take care of certain family members. This is called family caregiver leave. In order to qualify for this leave, a certificate must be issued by a qualified health practitioner stating that the family member that the employee is taking the leave for has a serious medical condition.

Family Medical Leave

Employees are entitled to take up to 28 weeks of unpaid, job protected leave in a 52 week period to take care of certain family members, or someone who the employee considers to be like family when a qualified health professional issues a certificate stating that they have a serious medical condition that has a high probability of death. The 52 week period will start on the first day of the week that the certificate is issued by the qualified medical professional.

Critical Illness Leave

When specific family members of an employee are suffering from a critical illness the employee is entitled to an unpaid, job protected leave. This is called Critical Illness Leave. To qualify for this type of leave a certificate from a qualified medical professional is required that states that the critically ill person requires one, or more family members to take care of them, and that outlines the period of time that the critically ill person will require care/ support.

When the family member suffering from the critical illness is a minor child (younger than 18 and under legal guardianship) the employee is entitled up to 37 weeks of leave in a 52 week period, if they are an adult then the employee is entitled to 17 weeks of leave in a 52 week period. Just like family medical leave, the 52 week period will start on the first day of the week that the certificate is issued by the qualified medical professional.

Organ Donor Leave

When an employee has surgery to donate all or a part of certain organs, they are entitled to organ donor leave. This unpaid and job protected leave can be taken for up to 13 weeks and in some cases can be extended by another 13 weeks if needed.

Reservist Leave

When an employee who is also a reservist, gets deployed, they are entitled to reservist leave. Unlike other leaves, the employee must be employed for at least 6 consecutive months to qualify for this type of leave.

Child Death Leave

If an employee's child dies, they are entitled to 104 weeks of unpaid, job protected leave. This leave must be taken within 105 weeks of the child's death.

Crime-Related Child Disappearance Leave

Employees are entitled to 104 weeks of unpaid, job protected leave if their child has disappeared as result of a crime. This leave must be taken within 105 weeks of the child’s disappearance.

Domestic or Sexual Violence Leave

Employees who experience, or are threatened with domestic or sexual violence are entitled to this type of job protected leave. The leave provides up to 10 full days and 15 weeks off. The first 5 days of the leave are paid, with the remainder being unpaid.

Declared Emergency Leave

When a declared emergency occurs, employees have the right to take this leave if: they are no longer performing their job due to said emergency, and one or both of the following are taking place: the emergency order that has caused the work stoppage is issued under s. 7.0.2 of the Emergency Management and Civil Protection Act (EMCPA); the order was made under the Health Protection and Promotion Act (HPPA), or the employee was needed to provide care or assistance to specified individuals.

Infectious Disease Emergency Leave

When an employee is no longer performing their duties, due to certain specific reasons that have resulted from a designated infectious disease, they are entitled to this job protected, unpaid leave.

Termination of Employment

The Employment Standards Act requires that you as an employer give employees advanced notification in writing, or termination pay in lieu of notification when terminating their employment. The longer an employee has been employed, the more notice or pay in lieu of notice is required to be given to said employee.

The amount of notice required is as follows:

Length of Employment Notice Required
More than 3 months and less that 1 year 1 week
More than 1 year and less than 3 years 2 weeks
More than 3 years and less than 4 years 3 weeks
More than 4 years and less than 5 years 4 weeks
More than 5 years and less than 6 years 5 weeks
More than 6 years and less than 7 years 6 weeks
More than 7 years and less than 8 years 7 weeks
More than 8 years 8 weeks

Once notice is given, the employees terms of employment must remain the same. As an employer, you must: not lower the employees wages or alter their employment contract; continue to make your contribution to the employee’s benefit plans; pay the employee their entitled wages that they would earn during a regular work week.

Severance Pay

When a long term employee loses their job, they can receive severance pay to compensate for losses, such as the loss of seniority.

Severance pay is paid in the form of a lump sum. Unlike termination pay, an employer cannot avoid paying this lump sum by giving notice of termination.

In order for an employee to qualify for severance pay when their employment has been severed, they must have worked for the employer for at least 5 years, and the employer that has severed their contract must have a payroll of at least $2.5 million; or they have severed the contract of 50+ employees over a 6 month period due to the closure of a portion or all of the business.

Severance pay is calculated by multiplying the number of years an employee has worked by their wages for a regular work week. The maximum amount that can be paid out under severance pay is 26 weeks worth of wages.

No Contracting out of Employment Standards Act Requirements

An employee's terms of employment can not fall below the minimum standards that are outlined in the employment standards act. Even if they enter into a contract that does not meet the ESA standard, it cannot be enforced.

The Common Law and Wrongful Dismissal

It is important for employers to know that when they terminate the employment of one of their employees, that employee may have more rights under common law (Judge-made, precedent-based law), then the notice of termination/ severance, or pay in lieu of termination/ severance. If the employee chooses the common law option and sues their employer for “wrongful dismissal” they no longer qualify for termination or severance pay.

Employment Insurance Act

When the employment relationship of an employee is ended, they may qualify for Employment Insurance Act (EI) benefits if:

  • They were employed in insurable employment
  • The employment was ended through no fault of their own
  • They have been without work for at least 7 consecutive days in a 52 week period
  • They have worked the minimum amount of insurable employment hours within a 52 week period (or start of employment if sooner)
  • They are willing and able to work each day
  • They are actively looking for a new job

Both you—the employer—and employees contribute to EI premiums.

Occupational Health and Safety Act

Employees should not have to go to work fearing for their health and safety.  This act provides the legal framework to help both employers and employees keep workplaces safe and healthy by creating an internal responsibility system. Under this act, employees are given the rights to work in a safe environment.

Workplace Safety and Insurance Act

Your employees deserve peace of mind that if injury or illness happen as a result of their work, they will be taken care of.  This act provides benefits and services to employees that are injured or fall ill while as a result of their work. These benefits and services are provided with little to no regard when it comes to who is at fault or to blame; or if there was any negligence involved. This is done so that employees do not have to spend large amounts of time and money fighting for compensation in court.

Pay Equity Act

Times have changed for the better - men and women should be on a level playing field in the workplace.  This act is meant to ensure that employers pay their female and male employees equally for work of equal value. The job’s value is determined by the skill and effort required; the responsibility, and the working conditions.

Privacy Legislation

Currently FIPPA/MFIPPA relates to a few of the employment related information such as expense accounts for employees, and the agreements between you as an employer and the employee that come about from negotiations for employment related matters. Most other employment related information are not covered by FIPPA/MFIPPA


As you can see, Ontario labour laws cover quite a few topics, and it’s very important that you as an employer become familiar with them. This is essential to protect yourself, as well as your employees, by ensuring that they are receiving all the rights that they are entitled to under the law.

At Knit, we help employers manage a lot of the stresses that come along with running a business. From employee vacation tracking, to remitting your taxes to the CRA, Knit saves you valuable time and energy.

Here's How Knit Can Help You:

Full Service Payroll

Knit calculates your source deductions, issues direct deposits, creates pay stubs for your employees, and remits taxes to the CRA. Need to issue ROEs, take care of EHT or WSIB? Knit's payroll software has you covered beyond the basics.

HR & Team Management

Knit makes managing all your HR data painless - we bring the most important information all to one place. Take advantage of our mass-import features, track historical compensation, set vacation policies, or set up your own custom data fields.

Manage and Track Time Off

Roll out custom time off policies and simplify how you track and manage time off. Let employees easily book time off when they need it and make it simple for managers to review and approve requests.