Pending EI Changes Under 2017 Canadian Federal Budget

Source: Bing Images, https://binged.it/2oGnkVu

 

 

 

As you know, last month Canada’s federal government released its 2017 Budget, as detailed in my Budget Highlights article.

The federal government touted the Budget as being particularly family-oriented, and as promoting gender equality and women’s participation in the workplace.

Among the dozens of announced measures in the Budget were a few items affecting Employment Insurance (EI) benefits.

These items will peak interest from employers which stand to be impacted by the following changes expected to be in place by 2018:

  1. Expectant mothers can begin to take EI maternity benefits for up to 12 weeks before their due dates, instead of the current 8 weeks.
  2. Parents will be able to claim EI benefits for up to 18 months as opposed to the current 12 months; but, the total amount of benefits received will be the same (with 12 months’ benefits equal to 55% of EI insurable earnings being extendable to 18 months’ benefits at 33% of EI insurable earnings).
  3. A new EI Caregiving Benefit will be created to give eligible caregivers up to 15 weeks of EI benefits while they are temporarily away from work to support or care for critically ill or injured adult family members. This benefit would be in addition to the existing Compassionate Care Benefit, which applies only where an individual is providing care for a gravely ill family member susceptible to loss of life within 26 weeks.

As a result of these measures, EI premiums are expected to increase for both employees and employers.

Although these measures have been announced, there are a number of details that still need to be ironed out. For federally regulated employers, the Canada Labour Code still needs to be amended to provide for the new leave rules, which the 2017 Budget proposes to do.

For provincially regulated employers (the sizeable majority of employers), it will be up to each province to amend their respective employment standards laws to offer enhanced job-protected leaves of absence that match the extension of benefits proposed in the 2017 Budget.

Most provinces permit a total of 12 months of maternity and parental leave and do not have a general “caregiving” leave, although most provinces have some form of sick leave, family medical leave, or emergency leave. Provincial human rights laws may also require employers to accommodate employees who have family caregiving responsibilities, or face the risk of a “family status” discrimination.

 

Supporting Article Research Sources: Mondaq, Ogletree, Deakins, Nash, Smoak & Stewart

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Alberta: Upcoming Workplace Laws Overhaul (Part 2 of 2)

…Continued from Alberta: Upcoming Workplace Laws Overhaul (Part 1 of 2)

The second and last part of this article focuses on the Labour Relations Code’ impending changes.

LABOUR RELATIONS CODE

Perhaps unsurprisingly, the areas of the Labour Code where the government is contemplating change is geared to enhancing union powers and increasing union involvement in Alberta. Also, any changes are likely to lead to a more robust Alberta Labour Relations Board, in concert with broader legislative changes that will impact all unionized workplaces.

In particular, the government is considering whether to:

  • Mandate a “Rand formula” in collective agreements, which involves the obligatory payment of union dues regardless of a worker’s status (i.e., workers would no longer be able to opt-out of a union and avoid paying union dues where they benefit from the collective agreement);
  • Change the Labour Code’s definition of “employer” and “employee”, which could bind more successor employers to collective agreements;
  • Give employees greater freedom in choosing, changing, or cancelling union representation (i.e., the introduction of a “card check” system);
  • Make certain unfair labour practice allegations are subject to a reverse onus provision, thereby putting the burden on the employer to contest an employee’s accusation;
  • Broaden the Board’s mandate to adjudicate a wider range of workplace disputes;
  • Augment the Board’s power, procedures, and remedial options; and
  • Undertake a general review of the Labour Code to see where Alberta’s labour laws depart from the Canadian mainstream (in a way which the government determines is “without benefit”).

CONCLUSION

Given that the legislation is due for an update, and the NDP’ orientation towards improved rights for workers and unions, it seems likely that the changes to the Employment Standards and the Labour Code can occur throughout this term of the NDP’s mandate.

The government says these changes are necessary to offer a “family-friendly workplace”. What remains unclear, though, is the extent to which these changes can co-exist with a “business-friendly workplace” since many of the proposed changes tip heavily for employees and unions, while Alberta’s economy remains in a fragile state.

 

Article Research Sources: Blake, Cassels & Graydon LLP, Mondaq

Alberta: Upcoming Workplace Laws Overhaul (Part 1 of 2)

Alberta’s NDP Government to shake up the province’s workplace legislation.

The Employment Standards Code (Employment Standards) and the Labour Relations Code (Labour Code) will be the subject of a brief public consultation (closing April 18, 2017) before the government assumes its review, and rolls out the significant primary changes to Alberta’s workplace laws not seen in decades.

As a matter of interest, Alberta’s workplace laws have remained the same for close to 30 years, while apparently provincial governments elsewhere in Canada have responded more quickly and readily to the changing dynamics of what the face of a modern workforce could, or should be.

Employment Standards and the Labour Code govern everything with respect to the employment relationship in Alberta’s workplaces (outside of federally regulated firms, and in addition to human rights and privacy legislation). The Labour Code regulates union work, and Employment Standards covers the non-union labour market.

The government says the forthcoming changes to Alberta’s workplace laws are actually “modest” and “not a full-scale review“. Still, many employers are most concerned about the consequences, particularly given the NDP’s policies for extending workers’ benefits, in addition to its long-standing union ties.

EMPLOYMENT STANDARDS

Employment Standards sets the minimum standards to which employers must adhere, including standards for hours of work and overtime requirements, vacation, maternity and paternity leave, general holidays and termination.

The government has not specified the precise changes it intends to make to Employment Standards. However, based upon a review of the government’s online consultation, employers may see the introduction of all, or any, of the following:

  • An increase in protected leaves (i.e., maternity, parental and compassionate care) and a reduction of employee tenure to realize eligibility for such leaves;
  • The creation of new unpaid protected leaves for personal short-term illness or injury, personal emergencies, and family responsibilities;
  • Changes to align protected leaves with the federal employment insurance program;
  • An increase in the banked overtime rate from 1:1 to 1:1.5 (i.e., employees can receive 1.5 hours of time off for each 1 hour of overtime banked);
  • Changes to the calculation of all compressed work week arrangements;
  • Stricter requirements on employers to give a mandatory paid or unpaid 30-minute break to employees for each five consecutive hours of work;
  • An increase in the instances that employees are entitled to general and Stat holiday pay;
  • Changes to the calculation of employee’s average daily wage;
  • New deductions from employee wages wherever the employee agrees to such deductions and receives a direct benefit in return (i.e., health and insurance packages, pay advances, meals, and lodging);
  • An increase in the opportunities for youth between 13 and 15 to gain employment;
  • New requirements on employers to notify the Minster of Labour when undertaking a group termination of 50 or more employees at one site within a four-week period (i.e., possibly including a notification to the affected employees and unions, not just the Minister); and
  • Enhanced tools for the government to enforce Employment Standards legislation, including the introduction of administrative and progressive penalties, increased fines, greater authority for employment standards officers, and publicly posting firm names that fail to satisfy judgments, or prove ongoing non-compliance.

 Please continue to read Part 2 here. Thank You!

Article Research Sources: Blake, Cassels & Graydon LLP, Mondaq

Canada: A Look Ahead to a Challenging 2017

As we start the new year, let’s look ahead to what may come down the pike in 2017. No crystal ball is necessary to predict that the complex issue of marijuana within the workplace (and everywhere else) will continue to take centre stage.

On December 13, 2016, a publication of the Final Report of the appointed Task Force on Cannabis Legalization and Regulation made headlines for the government’s seemingly bold, yet relatively bureaucratic plan, to legalize and regulate marijuana use.

The report raises a variety of questions and issues about the unwritten rules, such as; who is allowed to produce cannabis? where will cannabis be sold, and to whom? and what health messaging will accompany the legalization of cannabis in Canada?

Notwithstanding the details of this anticipated regulation, we should anticipate that Canadian employers will be faced with the problems associated with marijuana under numerous scenarios:

  • accommodating staff with legal permission to consume marijuana for medicinal purposes;
  • coping with personnel who are impaired by marijuana at work;
  • updating policies and procedures on impairment testing;
  • being asked to pay for marijuana under health plans; and
  • persisted confusion about the present criminal status of marijuana for non-medical use.

Another issue of concern for Ontario employers in 2017 is the outcome of the Changing Workplaces Review. On February 28, 2017, the Review’s Special Advisors are expected to deliver a final report containing recommendations for amending the Employment Standards Act, 2000 (“ESA”) and certain aspects of the Labour Relations Act, 1995 (“LRA”).

The media coverage to date has focused on “precarious” work, and whether changes should be made to standards on overtime, hours of work, exemptions and exclusions, and temporary help agency arrangements.

However, as set out in the Interim Report, the Special Advisors are considering a wider range of plausible amendments to the ESA and the LRA, all of which might have a weighty impact on employment in Ontario.

Finally, we should expect that the Canadian economy will be affected by a combination of political happenings that no one predicted: such as the Donald Trump presidency in the U.S., an NDP government in Alberta, and Brexit.

Shifts in employment metrics, notably in Alberta and Ontario, will likely occur if major policy changes from the U.S. and England are realized.

 

Supporting Article Research Sources: Borden Ladner Gervais LLP, Mondaq

Canada: Bill 26, Accommodation and Paid Leave ~ Domestic Violence

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As you may be aware, December 6th marked Canada’s National Day of Remembrance and Action on Violence against Women and Girls.

 

In fact, studies suggest that 54% of domestic and sexual violence victims have confronted abuse at or in near to their place of business, placing significant stressors on performance, attendance, and overall physical and mental health. Naturally, employers also feel the effects of the domestic violence dilemma.

Statistics Canada has said that incidents of domestic violence cost Canadian employers very close to $78 million annually. A new bill aimed at addressing these issues is currently progressing through the Ontario legislature.

If passed, Bill 26 (the Domestic and Sexual Violence Workplace Leave, Accommodation and Training Act, 2016), would amend the Employment Standards Act, 2000 [the “ESA“], allowing employees to take up to 10 days of paid leave per year if they, or their children, are victims of domestic or sexual violence. Although this pay may well be capped at 10 days, employees would be entitled to leaves of a “reasonable length” to seek medical attention, psychological counselling, community services, and/or legal assistance. Employees would also be entitled to take time off work to relocate, where the purpose of such relocation is to reduce the chance of future violence.

Employers would also be required to offer impacted employees with reasonable accommodation, such as reduced work hours, schedule modifications, or changes to the place of work. As is the standard elsewhere in the ESA, employers would only be required to accommodate up to the point of undue hardship.

Bill 26 also proposes amendments to the Occupational Health and Safety Act. The proposed changes could require that managers, supervisors, and workers take part in mandatory training on the warning signs, impacts, and risks of domestic and sexual violence in the workplace.

On October 20, 2016, Bill 26 passed second reading with the unanimous support of the Ontario legislature. It has now been referred to the Standing Committee on the Legislative Assembly.

 

Supporting Article Research Sources: Norton Rose FullbrightMondaq

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Deck the Halls with a Few Facts on Stat Holidays in BC

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It is the season once again when employers will be dealing with the frustrating intricacies of setting Stat holiday hours for their staff calendar and calculating the associated pay for their efforts. But what happens when primary Stats like Christmas fall on a regular day off, such as the weekend?

Well, as it happens, this year Christmas Day falls on a Sunday, Boxing Day follows on Monday, and New Years’ Day the following Sunday.

So, here is a reminder of some key points you may want to review with respect to employee entitlements under the BC Employment Standards Act.

Do employees automatically get Christmas Day, Boxing Day, and New Years’ Day off of work? Actually, No:

  • Christmas Day and New Years’ Day are Stat holidays in BC. However, while traditionally given as a holiday to many employees, Boxing Day is not a Stat holiday in BC (it is in Ontario, as well as for federally regulated entities);
  • There is no obligation to provide a day off in lieu of the Statutory Christmas Day and New Years’ Day holiday when it falls on a weekend;
  • Employers are able to enter into agreements with specific employees to substitute a different day for a Stat holiday;
  • Employers may also come to an agreement with a majority of its employees to substitute a different day for a Stat holiday; and
  • When an employee is given the day off for a Stat holiday, OR if the Stat falls on a regular day off (such as with Christmas Day in 2016 and this New Years’ Day in 2017), the employee is still entitled to Stat holiday pay.

Are all employees entitled to Stat Holiday pay? Generally, Yes, but with caveats:

  • All employees (full and part-time) are treated the same for Stat holiday pay purposes; and
  • Employees are only entitled to Stat holiday pay if they have worked OR earned wages in 15 of the 30 calendar days prior to the Stat unless the employees worked under an averaging agreement at any time during the 30 days preceding the holiday, in which case the employees are entitled to holiday pay even if they did not meet the 15-day threshold for that statutory holiday.

How do you calculate the pay entitlement? Depends if employees worked on the Stat:

  • Any employee who does not work on a Stat holiday must be paid an “average day’s pay.” That amount is calculated by dividing the amount the employee has been paid during the 30 days preceding the Stat (including vacation pay, LESS amounts paid or payable for OT) by the number of days the employee worked within that same 30-day period; and

Any employee who does work on a Stat holiday must be paid 1.5 times their regular wage for time worked on the Stat up to 12 hours, and 2 times their regular wage for time worked on the Stat over 12 hours PLUS 1 average day’s pay calculated using the formula outlined above.

 

 

Supporting Article Research Sources: Bull, Housser & Tupper LLP, Mondaq

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Canada: The Top 12 Employment Contract Terms

 

A well drafted and executed written employment contract can be useful in avoiding or resolving disputes during the employment relationship as well as when it ends – saving employers both time and money in either case.

Written Employment Contracts

Each employer has an employment contract with each employee – despite the fact that there is no supporting physical evidence of such (“nothing in writing”). There are many advantages to a well-drafted and carried out written employment contract, the ultimate advantage being notably fewer disputes and a significant reduction in the associated time and costs for the employer.

Readability & Comprehension

An employment contract that clearly sets out all the terms will help in fending off disputes later. And, since employment relationships are (or at least use to be) intended to last a long time, and human memories are fallible, a written employment contract ensures all the details, and occasionally complex arrangements are clearly and accurately recorded.

Legalese

In contrast to different “commercial” contracts, courts interpret employment contracts with an eye to protecting the employee. Consequently, they scrutinize employment contract terms intently, typically deciding any ambiguities in opposition the employer’s interest.

THE TOP 12 EMPLOYMENT CONTRACT TERMS ARE:

The standard form employment agreement is useful, but employers need to continually review it and, if required, customize it to suit particular circumstances. That said, there are some terms that essentially each employment contract needs to include. Here are the top 12 terms.

  1. Entire Agreement Clause. Another “legalese” clause that could make a difference in a dispute, this clause states that the written agreement is the entire agreement, and supersedes any earlier agreements – oral or written, drafts or final – the employer and employee might previously have made about the contract’s subject. This is in order to avoid both from claiming there are other contract terms in addition to those within the written contract.
  2. Fixed Term. If the employment contract is for a fixed term, make that clear, and specify the notice to which the employee is entitled upon early termination of the contract – or risk paying the remaining balance of the term.
  3. Independent Legal Advice. Include a clause in which the employee acknowledges he/she had the opportunity to seek independent legal advice on the contract. Be sure you give your employee time to consider the contract and to get that legal advice before signing.
  4. Non-Solicitation/Non-Compete. Employers are exposed to a financial loss while an ex-employee solicits his/her former employer’s clients and/or personnel. Employers can often protect their interests by way of imposing post-employment obligations on employees restricting or limiting their capacity to compete and/or to solicit clients and employees. However, public policy discourages such restraint of trade generally, and such obligations can affect the employee’s ability to earn a livelihood. Courts intently scrutinize them and refuse to enforce them unless the employer can prove they protect a valid proprietary interest of the organization, and are reasonable in terms of duration, geographic scope, and the nature of the activities prohibited. The key here is to apply clear and unambiguous language and not to invite more than is clearly necessary to protect the employer’s interests.
  5. Obsolescence Clause. An “obsolescence clause” is intended to make certain the employment agreement will continue to be relevant and enforceable no matter how long it lasts, and even if the employment relationship fundamentally changes between the date the contract is signed and the date the employment relationship ends.
  6. Permitted/Prohibited Activities. An employer does not automatically have cause to terminate a “moonlighting” employee without notice or pay-in-lieu of notice. Make it clear whether the employee is permitted to undertake other activities – for pay, or without pay (such as charitable work) – during his/her employment, or whether he/she must devote all the time to the job, and other activities (or certain ones) are either completely off-limits, or require the employer’s consent ahead of time.
  7. Probationary Period. Including a period of probation to decide whether the candidate is suitable for employment can be of value to the employer. A probationary clause states the employer can terminate the employee’s employment during a specified probationary period without notice or cause. However, it is important to note there that in order for it to be enforceable, the clause must comply with the minimum notice period under Employment Standards legislation.
  8. Protection of Intellectual Property, Confidentiality & Non-Disclosure. Intellectual property (IP) and confidential information, such as market research, financials, and proprietary client information, can be an employer’s biggest asset.
  9. Remedies for Breach of Confidentiality. The normal resolution from a court is monetary compensation. Employers should include a clause specifying the employee’s liability for monetary compensation for breach of his/her obligations, but the contract should also state that this is insufficient and that the employer and employee contemplated and accepted an injunction (a court order to stop doing something) and/or specific performance (a court order to do something) if the employee breached his/her confidentiality obligations.
  10. Resignation Notice Clause. Employers often require senior executives to give notice of resignation in order to deal with difficulty in recruiting or replacing a specialized skills position and ensure a smooth transition. The resignation notice is often considered a moral obligation and most employers do not act on such a clause – but it IS enforceable.
  11. Severability Clause. One of those “legalese” clauses that can save the day, states that any legally unenforceable terms or phrases of the employment contract are severed from the contract without affecting the enforceability of any of the other contract terms. For instance, it could operate to sever an unenforceable probationary clause – and leave an otherwise enforceable termination clause standing.
  12. Termination Clause. A “termination clause” is meant to displace an employee’s entitlement to “reasonable notice” of termination without cause through specifically setting out the employee’s notice entitlement. The law generally presumes that an employer can terminate a contract of “indefinite duration” (as opposed to one for a fixed term) without cause by giving the employee “reasonable notice” (Note: The employment standards legislation of some provinces requires cause for termination of employees with more than a specified length of service; seek out the guidelines for your province to ensure compliance). An enforceable termination clause – one that uses clear, unambiguous language expressly specifying some other period of notice and complies with employment standards legislation – offers both the employee and the employer certainty.

 

Supporting Article Research Sources: McInnes Cooper, Mondaq

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Canada: Employers Right to Rescind Job Offers

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Employment law in the Alberta region, as well as other areas of Canada, is large in scope. However, in any legal field, there are areas that may be a bit hazy.

While the law clearly states what employers can and cannot do in terms of employment, the time leading up to employment can be one of these hazy, gray areas.

Once an employer extends a job offer, the potential new employee has to take certain actions, such as preparing a notice of resignation to his or her current employer. He or she may also make more extravagant purchases than normal to celebrate the new role, and the anticipation of earning more money. If the job offer is then rescinded, this potential new employee may discover that he or she is in much hot water.

Even though this area of employment law may not be 100% clear, there are a couple of situations in which the employer can withdraw a job offer.

The first is with conditional job offers. For example, an employer offers you a job but tells you that the job hinges on positive reference checks or background checks. In such a case, if the employer receives a bad reference, or spots a problem during a background check, he or she can move to rescind the offer.

The second situation may arise if the potential employer discovers an applicant has not been truthful during his or her recruitment. For example, if an applicant misrepresents his or her education credentials or work history, the employer can legally choose to rescind the offer.

If you believe an employer has illegally rescinded a job offer, you should seek legal advice from an employment lawyer. This can help you determine if the job offer was rescinded in compliance with Alberta’s Employment Standards Code and Regulation.

 

Supporting Article Research Sources: Ridout Barron, HRM Canada, Mondaq

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Canada: Avoid the Potential Pitfalls of ‘Fixed-Term’ Employment Contracts

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On October 13, 2016, the Supreme Court of Canada denied leave to appeal an Ontario Court of Appeal decision which ordered an employer to pay a former employee 37 months of salary and benefits following termination (without cause) – after only 23 months into the contract of employment.

In this case, the employee in question had a written contract with a ‘5-year term’. The employer terminated the employee just 23 months into the contract, without alleging cause. The employer’s right to early termination without cause was governed by the following provision:

Employment may be terminated at any time by the Employer and any amounts paid to the Employee shall be in accordance with the Employment Standards Act of Ontario.

The employer paid the employee two weeks’ salary in lieu of notice and took the position that it had satisfied the contract. The motion judge, however, found that the without cause termination provision was unenforceable because of ambiguity. That finding was not appealed.

When the termination without cause provision was held to be unenforceable, the employer argued that the common-law presumption of reasonable notice of termination should apply.

The Court of Appeal disagreed with this thinking and held that when the employer terminated a fixed term employment contract, without cause, and there was no enforceable provision for early termination without cause in the contract, the employee was entitled to the compensation he would have received to the end of the employment contract. As a result, the employee was entitled to 37 months of salary and benefits.

In addition, the Court found that the employee had no duty to mitigate his damages. Consequently, even if the employee found new employment the day following the termination, he would still be entitled to the 37 months of compensation from his former employer.

This case serves as an important reminder of the necessity for clearly written employment contracts as a whole, and the termination provisions therein explicitly.

The key takeaways for employers are:

  • Fully consider whether or not a fixed term contract is appropriate in the circumstances of the specific job and employee at issue. If it is anticipated that the employee may not complete the full term of the contract, either because of availability of work, or the circumstances of the employee, a contract of indefinite duration may be preferable so as to avoid this additional exposure. In most cases, with properly worded termination provisions, there is no need for a fixed term agreement.
  • A termination without cause provision that clearly refers to the applicable employment standards minimum notice provisions is likely inadequate to allow early termination of a fixed term agreement without paying out the remaining sums owed under the contract.
  • Ensure termination provisions are clear and unambiguous. Of course, every contractual term should be clear, but that requirement is especially crucial when dealing with provisions that convey a high price for failure to reap clarity.
  • Employers would do well to keep in mind, absent a provision in the agreement requiring that the employee attempt to mitigate, an employee has no obligation to mitigate his/her damages when a fixed term contract is terminated early.

This case further reinforces the fact that all employers should have their employment contracts reviewed before they are presented to prospective employees. Had the employer adhered to that advice, it could have saved hundreds of thousands of dollars in damages and legal fees.

 

Supporting Article Research Sources: Thompson Dorfman Sweatman LLP, Mondaq

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Canada: Alberta’s Minimum Wage Increase Imminent

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On October 1, 2016, Alberta’s minimum wage will surge from $11.20 per hour to $12.20 per hour. This is the preliminary step within the provincial government’s plan to increase the minimum wage in Alberta to $15.00 per hour by October 1, 2018.

The subsequent step of the plan will take effect on October 1, 2017, when the minimum wage will rise once more to achieve $13.60 per hour.

The minimum hourly wage is not the lone aspect of the Employment Standards legislation that is changing, weekly and month-to-month minimum wages are also increasing. Many individuals in Alberta are paid on an hourly basis, however, certain occupations; usually related to irregular work schedules or commissioned income, are not well-suited to an hourly pay scale.

Employees in such situations, including salespersons, land agents, and other professionals1 are no longer required to record their hours worked, and are entitled to a minimum weekly wage, now set at $446 per week. Now, as of October 1, 2016, this amount will also grow to $486 per week.

In-home caregivers will also enjoy an increase in the minimum monthly wage presently set at $2,127, with an increase to $2,316 as of October 1, 2016.

By October 1, 2018, these minimums will jump to $598 per week and $2,848 per month, respectively.

Furthermore, as of October 1, 2016, there will no longer be a lower minimum wage for employees serving alcohol as part of their regular job function. Rather, those workers must be paid the regular hourly minimum wage, which, at that time, will be $12.20 per hour.

More information on these and other approaching changes can be found on the Government of Alberta’s website.

Footnotes: 1 See Alberta’s Employment Standards Regulation at Section 2(2) for listed occupations.

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Source: Government of Canada, Hourly Minimum Wages in Canada for Adult Workers

 

Supporting Article Research Sources: Mondaq, Field LLP, Government of Alberta

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