Temporary Lay-off Period Extended in Newfoundland and Labrador

June 15, 2020

On June 12, 2020, legislation was passed temporarily amending the Labour Standards Act (the “Act”) to extend the period of temporary layoff contemplated in the Act.


Previously, under section 49 of the Act, an employee on temporary layoff for a period exceeding 13 weeks over a consecutive 20 week period would be considered to have had their employment terminated. With this recent amendment, the period of time before an employee’s employment is considered to be terminated has doubled, from 13 weeks to 26 weeks over a consecutive 33 week period. The legislation creates a window from March 18, 2020 to September 18, 2020 during which any temporary layoff can be extended for up to 26 weeks over a consecutive 33 weeks before such lay off is deemed to be a termination of employment. Importantly it can be applied to employees already on temporary layoff.

It is also noteworthy that the new legislation extends the time period in which an individual may bring a complaint to the Director of Labour Standards from 6 months to 12 months from the date of termination of employment.

What does this mean for employers?

With the amendment to the legislation regarding the temporary layoff period, employers can take additional time to recover from the financial strain that has accompanied COVID-19 without the added expenditure associated with permanent terminations or returning employees to work before it is fiscally reasonable for their operations.

It should be noted, however, that while the Act addresses temporary layoffs in non-unionized workplaces, employers are not immune from claims of constructive dismissal at common law. In light of the current economic circumstances, however, the risk of a successful constructive dismissal claim may be relatively low where employers communicate to their employees that (1) COVID-19 related layoffs are temporary in nature; and (2) the company intends to recall the employees to work upon the resumption of business operations.

Related Articles

Laying it All Out: Why Layoff Clauses Should be Included in Employment Contracts

In times of financial uncertainty, employers seeking to cut costs may quickly turn to temporary layoffs. From the employer’s point of view, layoffs offer an opportunity to press “pause” on its obligations to employees in the short-term while still maintaining the employment relationship in the long-term. Failing to handle layoffs properly, however, may leave the […]

read more

Without Cause Termination Provisions: The Potential Ace in an Employer’s Hand

The New Brunswick Court of Queen’s Bench has recently clarified the law regarding without cause termination provisions. The decision, Stéphane Vienneau v. Joy Global (Canada) Ltd., 2020 NBQB 76, explains that a properly worded termination provision is valid and enforceable even if it limits the employee’s entitlements to those set out in the Employment Standards […]

read more
view all
Cox & Palmer publications are intended to provide information of a general nature only and not legal advice. The information presented is current to the date of publication and may be subject to change following the publication date.