The Employment Standards Act

by | Dec 27, 2022 | Employment Law | 0 comments

Ontario’s Employment Standards Act (ESA) is one of the main sources of employment laws in Ontario. For almost every worker in Ontario, it outlines their minimum rights in the workplace and covers most aspects of the employer-employee relationship. Learn about your rights regarding essential employment issues, including working hours, legally entitled leaves and termination of the employment contract below.

Keep in mind that these are the minimum standards for most workers in Ontario; if your employment contract allows for a greater benefit than the ESA (e.g., longer vacation time, paid sick days), that benefit becomes your new legal minimum, and your employer can not violate it. If you’re unsure about what your employment contract provides, speak to your HR rep, union steward or a leading disability and employment lawyer in Ontario.

Disclaimer: The information in this guide and everywhere else on this website is for general information only and is not intended to provide legal advice of any kind. No lawyer-client relationship is created by accessing or otherwise using Ertl Lawyers’ website or by communicating with a lawyer or staff member. If you need legal advice, contact one of the leading employment lawyers in Toronto at Ertl Lawyers. We’re more than happy to speak with you.

First Things First: Does the Employment Standards Act Apply to You?

The Employment Standards Act applies to many, if not most, workers in Ontario. There are, however, industries that are under the jurisdiction of the federal government, which regulates their operations through federal laws. Some of these industries include:

  • Air transportation, airlines, airports and aircraft operations
  • Road transportation services and railways that cross provincial and international borders
  • Ports, marine services and vessels, tunnels, canals, bridges and oil and gas pipelines that cross international or provincial borders
  • Banks
  • Telecommunications, including phone, Internet and cable systems
  • Radio and television broadcasting
  • Canada Post and other postal and courier services
  • Crown corporations, federal government agencies and the military

Employees who work in federally-regulated industries are protected by the minimum employment entitlements in the Canada Labour Code.

Aside from federal workers, there are certain professions in provincially-regulated fields for whom certain parts of the ESA do not apply and who have special rules regarding their employment rights. Some of these professions and industries include:

  • EMS, healthcare and health professionals.
  • Manufacturing, construction and mining.
  • Hospitality services and sales.
  • Transportation.
  • Agriculture, growing, breeding, keeping and fishing.
  • Household, landscaping and residential building services.
  • Government employees.

This page has the full list of the exceptions to the ESA with links to their respective rules.

Other Laws that Regulate Workplaces in Ontario

Workers in Ontario are also provided rights and protections from other Ontario laws. Each one is designed to address a specific issue, but there can be overlap at times when a workplace incident violates two or more statutes, and a decision must be made by the victim of the violation or a governmental oversight agency as to which law provides for a more appropriate outcome if a complaint is filed or a charge is laid.

These are a few of the provincial laws that have a significant impact on the way Ontario workplaces operate:

  • The Occupational Health and Safety Act (OHSA). The OHSA mainly addresses safety in the workplace by creating laws that protect employees and places an onus on employers to provide a safe work environment.
  • The Workplace Safety and Insurance Act. The WSIA was created to promote health and safety in the workplace, help injured workers recover and re-enter the workforce and provide workers injured on the job with compensation while they are unable to work.
  • The Ontario Human Rights Code. The OHRC prohibits discrimination based on grounds such as race, ancestry, place of origin, colour, ethnic origin, citizenship, creed, sex, sexual orientation, age and others in housing, employment and other areas.

Two employees in safety gear look at a paper

The ESA and Daily and Weekly Maximum Hours of Work

Unless there is a written or electronic agreement between the employer and employee, employees can not be required to work more than eight hours in a day or the number of hours in an established regular workday.

Similarly, the maximum number of hours employees can be required to work in a week is 48 unless the employer and employee have a written or electronic agreement stating otherwise.

Agreements to exceed daily or weekly ESA limits on working hours must comply with the following guidelines:

  • The employer had provided the employee with the most recent information sheet for employees regarding hours of work and overtime pay. This data sheet is provided by the Director of Employment Standards, and it details the rules around hours of work and overtime in the ESA.
  • The agreement must include an acknowledgement by the employee that they were provided with a copy of the information sheet.

An employee can cancel an agreement to work more than the maximum number of hours in a day or week by providing their employer with two weeks’ notice either electronically or in writing. An employer is only required to give an employee reasonable notice if they decide to end the agreement. If an agreement is cancelled, the employee can no longer work more than the maximum limits.

An agreement between an employee and an employer to work additional daily or weekly hours does not relieve an employer from the requirement to pay overtime rates where overtime hours are worked. This means that if you work overtime hours to complete your essential job duties, whether approved in advance by your employer or not, you are required to be compensated for those hours worked under overtime rates.

Minimum Wage in Ontario

The minimum wage is the lowest rate an employer can legally pay an employee.

Whether they are full-time, part-time or casual, most employees are entitled to the minimum wage. There are exceptions for students, liquor servers and others. Find out more about these exceptions on this page.

At the time of this writing, the general minimum wage in Ontario is $15.50 per hour.


The Employment Standards Act provides employees with minimum entitlements to time off work to use as vacation time and to earn vacation pay as they work.

Employees who have completed their probationary period and have less than five years of employment are entitled to two weeks of vacation time after each 12-month period that they complete on the job. Employees with five or more years of employment are entitled to three weeks of vacation time.

Employees are also entitled to start accumulating vacation pay from their first day on the job. Vacation pay must be at least 4% of the employee’s gross wages if they’ve worked less than five years with their employer. An employee with five or more years of service is entitled to earn a minimum of 6% of their gross wages as vacation pay.

Leaves from Work

Under the Employment Standards Act, employees are allowed unpaid time off from work to deal with personal and family issues and illnesses and injuries. When taking a leave that you are legally entitled to, your job is protected, and your employer can’t fire or punish you for taking a leave, planning to take a leave or asking about leave.

These are some of the different types of leave (middle of the page) from work that are allowed by the ESA:

  • pregnancy and parental leave
  • sick leave
  • bereavement leave
  • family responsibility leave
  • family caregiver leave
  • family medical leave
  • critical illness leave
  • child death leave
  • crime-related child disappearance leave
  • domestic or sexual violence leave
  • declared emergency leave

If the position you held prior to going on leave is no longer available when you return, your employer must provide you with a comparable role at the same rate of pay if there is one available. Some of the other job protections regarding leave include:

  • Continuing to receive benefits such as dental coverage, insurance, pension, etc., while on leave if you choose to.
  • Continuing to add time to the length of your service with your employer. Your length of service is used to calculate:
    • Termination and severance pay when the employment contract is ended (if applicable, see below).
    • How much vacation time and vacation pay that you earn.

Public Holidays

Ontario has nine public holidays for which most employees are entitled to the day off work while also receiving pay:

  • New Year’s Day
  • Family Day
  • Good Friday
  • Victoria Day
  • Canada Day
  • Labour Day
  • Thanksgiving Day
  • Christmas Day
  • Boxing Day

Notice of Termination, Termination & Severance Pay

Under the ESA, employers can terminate an employee without needing a reason to. This is known as a termination without cause. An employer is not allowed, however, to terminate an employee if they are doing so on discriminatory grounds, like the employee’s religion, disability or family status.

If an employer terminates an employment contract without cause and the employee has been working for at least three months, the employer must provide the employee with notice before officially ending the employment contract. The minimum amount of notice required by the ESA is one week for every completed year of service to a maximum of eight weeks. This is referred to as a ‘notice period.’

Termination Pay

If an employer decides to terminate an employee immediately, they must pay the employee the equivalent of the wages they would have earned during the notice period. This is known as ‘termination pay’ or ‘pay in lieu of notice.’

Your employer can elect to give you working notice or termination pay. Your employer does not have to give you the option you prefer.

Severance pay

When an employee with at least five years of service is terminated, they may be entitled to severance pay in addition to the notice of termination or pay in lieu of notice. To be eligible for severance pay, their employer must have a total global payroll of at least $2.5 million.

An employee who qualifies for severance pay in Ontario is entitled to one week’s pay for every year of service, up to a maximum of 26 weeks.

Termination for Cause

An employer can also terminate an employee because of an incident in the workplace or a pattern of behaviour and classify the termination as a “for cause” termination. They must provide a reason for doing so, however.

Termination for cause is only meant to be used in severe circumstances, such as intentional misconduct, disobedience, or wilful neglect of duty. The standard is relatively high because if an employee is terminated with cause, the employer doesn’t have to pay termination or severance pay, and the terminated employee may not be eligible for Employment Insurance (EI) benefits.

A relatively high standard is also needed to prove Frustration of Contract in Ontario. If an employee is on disability leave for a while, or if there’s a slowdown in the economy, some employers will end the employment contract claiming that it was no longer possible to fulfil its terms (i.e., in the event of a disaster causing the business to close or if the employee is unable to permanently work due to accident/illness). If an employment contract is frustrated, the employer does not have to pay termination or severance pay.

If you were terminated for cause or laid off due to frustration of the employment contract, speak to an employment lawyer right away to ensure that your rights were not violated and that you aren’t owed compensation.

Thinking of signing an employment contract that has an arbitration clause? Find out how an Arbitration Clause can affect dispute resolution in the workplace.

David Ertl Lawyer
About Andrea Allin
Andrea is a part of the Ertl Lawyers team and has focused on employment and disability matters for over a decade.


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