Federal – Expense Reimbursements and Distribution of Employment Information

What’s happening? On April 21, 2023, the federal government published an Order in Council (“Order”) that amends the Canada Labour Code (“CLC”), which applies to federally-regulated industries and workplaces. These amendments include new specifications for employer reimbursements of work-related expenses and employer obligations for sharing information about employment rights with their employees (“Amendments”). Further details about the Amendments can be found in the Regulations Amending Certain Regulations Made Under the Canada Labour Code (“Regulations”).

Effective Date. The Amendments come into effect on July 9, 2023. The Regulations come into force on the same date or, if they are registered after that date, 60 days after they are published in the Canada Gazette, Part II (“Gazette”).

What does it say? The Amendments include the new requirements for below.

• Reimbursement of Work-Related Expenses: Employers must reimburse employees for reasonable work-related expenses unless:

1. The expense is ineligible (the Regulations specify how to determine whether an expense is eligible for reimbursement); or
2. The employee has agreed with the employer, in writing, that the employee is required to pay the expense.

If the employer and employee have agreed, in writing, to a time limit for reimbursement, that time limit must be followed. If no such agreement has been set out in writing, the employer must reimburse the expense within 30 days, per the Regulations.

• Information related to Employment: Employers must provide employees with government materials about the rights and obligations of both employers and employees (e.g., standard hours, wages, vacations, holidays, and termination obligations) (“Materials”). The most recent version of the Materials must be posted in places that are likely to be seen by and readily accessible to employees.

These Materials must be shared with the employee within:

1. The first 30 days of an employee’s employment; and
2. 30 days each time updated Materials are made available.

If an employer terminates an employee’s employment, the employer must, by the employee’s last day, provide the employee with the most recent version of the Materials that relate to terminations of employment.

To assist employers with the transition as these requirements come into force, employers need only provide existing employees with these Materials within the later of:

1. 90 days from the date the Amendments come into force; and
2. The day the Materials are first made available.

• Employment Statement: Employers must provide new employees with a written statement about their employment (“Employment Statement”) within 30 days of their employment and provide an updated Employment Statement within 30 days if any information changes. Under the Regulations, the Employment Statement must include basic information such as the term of employment, any probationary period, the required training, and the frequency of payments. Employers must keep a copy of the Employment Statement for 36 months after the employee leaves and provide it to the employee on request. If an employer has not already provided an Employment Statement to existing employees, they must provide it within 90 days of the Amendments coming into force (October 7, 2023).

What should we do? Given that the Amendments come into force on July 9, 2023, employers are encouraged to work with human resources (“HR”) staff and begin assessing whether their employees typically incur expenses related to their job duties, such as uniforms or gasoline, and if these expenses are reimbursable. If so, employers should consider preparing a system to track expenses and applicable timelines to avoid missing a reimbursement deadline.

Employers should also keep aware of when the Materials are available to be distributed to employees and consider including the Materials as part of employee onboarding/offer packages to ensure compliance with the distribution requirements. Given the short timeline employers have to distribute Employment Statements to employees, employers and HR should consider preparing a template of the Employment Statement during the approximately two-month period before the Amendments become effective so that these templates can be easily filled in and distributed to existing employees by October 7, 2023 and new employees within 30 days of employment.

Not in the Federal Jurisdiction: Why should we care? Currently, several provinces have legislation that provides employees with the right to be reimbursed for work-related expenses and recourse for those who are unable to obtain these reimbursements. British Columbia and Newfoundland and Labrador already require employers to provide a written statement of employment conditions, but they differ in the specific information required. Employers in all provinces and territories are encouraged to review the applicable laws and any changes to the legislation to confirm rules around reimbursement, materials to be provided to employees with respect to their rights, and written employment statements, and ensure compliance with these legal requirements.

For additional information regarding this HR Alert, please contact your Relationship Manager or the ADP Workforce Now Comprehensive Services team. This HR Alert, along with all the other HR Alerts and HR Tips issued by ADP Workforce Now Comprehensive Services, is also available in the HR Knowledge Library through the ADP Workforce Now Comprehensive Services Portal.

The information contained in this document is summary in nature and is intended to provide general guidance only. It should not be viewed as a replacement for legal or professional advice. While every effort is made to provide current information, the law changes regularly and laws may vary depending on the province or territory. You should review applicable law in your jurisdiction and consult experienced counsel for legal advice. This content is the property of ADP Canada Co.

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