Temporary layoffs—in certain situations and when carried out appropriately—are a legally accepted practice in Alberta, according to the Employment Standards Code, which governs employment in Alberta and establishes minimum standards of employment.

In this post, you’ll learn

  • what a temporary layoff is,
  • when an employer can temporarily lay off employees, and
  • what the correct procedure for implementing temporary layoffs is,

according to Alberta employment law.

3 Important Questions About Temporary Layoffs in Alberta

Both employers and employees should understand the rights and obligations set by provincial employment law (the Code) for temporary layoffs. 

1. What is a temporary layoff in Alberta?

A temporary layoff is when an employer temporarily stops paying an employee to come in to work without firing them, maintaining the employment relationship. A temporary layoff can include a reduction of work hours if employees earn less than 50% of their weekly wages at the regular rate (averaged over eight weeks). 

During a temporary layoff, the employment agreement is still in effect even though employees don’t attend work as usual. Employees retain employee benefits and entitlements such as sick leave or vacation, and there is an understanding that the employee will return to work. 

A situation is a temporary layoff when the employee is laid off for:

  • A cumulative 60 days within a 120-day period before March 17, 2020
  • 120 consecutive days between March 17, 2020 and June 17, 2020
  • A cumulative 90 days within a 120-day period after June 17, 2020

Layoffs related to the COVID-19 pandemic state of emergency in Alberta have special provisions for up to 180 consecutive days.

Temporarily laid-off employees are not entitled to severance pay or termination pay unless the employer fails to recall the employee within the maximum temporary layoff period, in which case the employee is technically terminated and is entitled to termination pay under the Code.

2. When can an employer temporarily lay off employees?

According to the Code, temporary layoffs are acceptable only under certain conditions, including:

  • The employment contract permits it
  • It’s a common practice in the industry, such as seasonal business closures
  • The employer and employee agree to it

Common Reasons for Temporary Layoffs

Temporary layoffs usually happen when an employer requires short-term provisions to stay in business during difficult times—such as during the COVID-19 pandemic. Other common reasons for temporary layoffs include:

  • Equipment maintenance
  • Facility maintenance
  • Temporary safety hazards requiring remedy
  • Corporate restructuring
  • Business relocation
  • Business mergers, acquisitions, or buyouts

3. What is the correct procedure for implementing temporary layoffs?

Before an employer implements temporary layoffs, it’s crucial that they review the employment agreement to ensure they have a contractual right to do so. They should ensure their temporary layoffs and procedures comply with the laws set out in the Code.

Employers must provide employees with proper written temporary layoff notices—one week’s notice for employees of up to two years, and two weeks’ notice for employees of over two years. These notices must include:

  • Sections 62, 63, and 64 of the Alberta Employment Standards Code
  • A statement that it’s a temporary layoff notice
  • The effective date
  • All other relevant information as required by the regulations

The law provides for exceptional situations where appropriate notice periods are unreasonable or impractical. However, employers should not take notice periods lightly because failure to provide proper notice can lead to a case of wrongful dismissal or constructive dismissal

If an employer needs to extend a temporary layoff beyond the maximum period, they may do so by making regular payments to the employee, such as salary, wages, benefits, and pensions. This must be agreed upon between the employer and the employee. 

There is also a proper procedure for recalling employees after a temporary layoff. The recall must be in writing and state that the employee must return to work within seven days of receiving the notice. This notice can be served

  • By fax, email, regular mail, or registered mail
  • In person at the employee’s address or at work
  • By leaving the notice with a person who appears at least 18 years old at the employee’s address

Temporary Layoff Lawyers in Alberta

The employment laws of Alberta govern the rights and obligations of both employees and employers in temporary layoff situations. If you have questions about any aspect of temporary layoff law, or if you may be involved in a wrongful termination situation, contact the employment lawyers at Getz Collins and Associates today.