On March 21, 2023, during his traditional budget speech, the Minister of Finance of Québec announced that Quebecers will benefit from a general reduction in personal income taxes starting in 2023. The effect will be a reduction in the tax rates that apply to the first two taxable income brackets of the personal income tax table. In addition to having a positive impact on Quebecers’ disposable income, the tax cut will also have repercussions on source deduction rates applied to certain payments and remuneration. The fixed rates used for provincial income tax source deductions on lump-sum payments have been changed. Employers will therefore have to adjust their calculations for such payments. This will be the case, for example, where sums are paid as retiring allowances, as is frequently the case in the settlement of certain employment termination agreements. Previously, the rate used to calculate provincial income tax source deductions on a retiring allowance payment was 15% for amounts up to $5,000, and 20% for payments over $5,000. The income tax deductions on such payments made after June 30, 2023, is now 14% for amounts up to $5,000, and 19% for payments over $5,000. Table of provincial and federal income tax source deduction rates for lump-sum payments, effective July 1, 2023, by amount of lump-sum payment (e.g. retiring allowance): $5,000 or less Provincial tax rate 14% Federal tax rate 5% Over $5,000 up to $15,000 Provincial tax rate 19% Federal tax rate 10% Over $15,000 Provincial tax rate 19% Federal tax rate 15% Although it may seem trivial, this review of provincial income tax source deduction rates has far-reaching implications, given that these are often used by parties especially in the negotiation of employment termination agreements. Human resources and payroll professionals must use the new income tax source deductions in their employment termination negotiations to ensure that they are tax compliant. A positive outcome of these rates is that employees will now have more disposable income after tax for the same amount paid by their employer. Such a measure could make reaching an agreement easier in the context of tough negotiations. As an employer, it is essential that you update your payroll systems and processes to correctly reflect the new income tax rates and ensure tax compliance. Our team of labour law and tax professionals is available to answer your questions about this change and help you make informed decisions that will benefit your business.
Camille Rioux Senior Associate
- Québec, 2015
Camille practises in the firm's Employment and Labour Law Group.
She advises public, para-public and private sector employers on issues related to human resources management and on developing good employment relations.
She also represents the same employers in litigious matters involving individual and collective employment relations before the civil courts and administrative tribunals, particularly grievance arbitration tribunals and the Administrative Labour Tribunal.
During her legal studies, she articled for several administrative judges with the Commission des lésions professionnelles (now the Administrative Labour Tribunal). She also participated in the reform of the Jurist’s Skills course (Habiletés du juriste) at the Université de Montréal.
Camille joined the dynamic team of Lavery in 2020, after practising for a few years with another firm.
- Author of the article "Gestion des produits dangereux : mieux vaut prévenir que guérir", which appeared in Grassmaniac, a specialized trade journal of the Quebec Golf Superintendents Association (October 2016)
- Co-author of the article "Évaluation et congédiement d’un salarié en période de probation : tour d’horizon des critères applicables", published in the Bulletin en ressources humaines by Éditions Yvon Blais (September 2016)
- Co-author of the article "Un employeur peut-il fonder aveuglément ses décisions sur celles d’autorités étrangères?", published in the journal VigieRT of the Ordre des conseillers en ressources humaines agréés (September 2015)
- Co-author of the article "Droit de l’emploi - Peut-on vérifier votre dossier de crédit lors de l’embauche?", which appeared in the legal journal Liaison, published by the Canadian Association of Paralegals (October 2015)
- LL.B., Université de Montréal, 2014
Boards and Professional Affiliations
- Young Bar of Montreal
On June 1, 2023, Bill 19 entitled An Act respecting the regulation of work by children (the “Act”) which establishes, in particular, a minimum working age of 14 and a maximum number of hours of work for children subject to compulsory school attendance, was assented to. Most of the Act’s provisions came into force on June 1, 2023. This Act was presented in the wake of a massive and noticeable entry of young workers into the job market in a context where the shortage of unskilled workers was exacerbated by the COVID-19 pandemic. Work performed by these children has received significant media coverage in recent months, in particular because of the concerns raised regarding their health and safety and the risk of school dropouts and disengagement. Below is a brief overview of the existing rules governing work by children and the amendments introduced by the Act. A. RULES GOVERNING WORK BY CHILDREN BEFORE THE ACT CAME INTO FORCE Before the Act was passed, there was no minimum working age or maximum number of hours of work per week for children in Quebec. However, the Act respecting labour standards (the “ALS”)1 already provided certain rules applicable to work performed by children. The following rules remain unchanged by the Act: Prohibition of work performed by a child that is disproportionate to the child’s capacity, or that is likely to be detrimental to the child’s education, health or physical or moral development.2 Prohibition of work performed during school hours by a child subject to compulsory school attendance.3 In Quebec, the obligation to attend school extends to the last day of school in the school year in which the child reaches 16 years of age or in which the child graduates if they are under 16 years of age.4 The employer must also ensure that the child can attend school during school hours.5 Prohibition of work by a child between 11 p.m. and 6 a.m. if the child is subject to compulsory school attendance, except in the case of newspaper deliveries or other cases provided for in the Regulation, in particular for certain categories of artists.6 Obligation to ensure that the child can be at the child’s residence between 11 p.m. and 6 a.m., except in the case of a child no longer subject to compulsory school attendance and in the cases provided for in the Regulation.7 In addition, certain regulations adopted under the Act respecting occupational health and safety stipulate a minimum age for performing certain tasks (e.g., diving, excavation, demolition, etc.). B. AMENDMENTS INTRODUCED BY THE ACT 1) Amendments to the Act respecting labour standards and the Regulation respecting labour standards Minimum age to perform work: The ALS was amended to set the minimum working age at 14,8 except as provided in the Regulation. The exceptions are as follows: a) Creator or performer in a field of artistic endeavour referred to in the first paragraph of section 1 of the Act respecting the professional status of artists in the visual arts, film, the recording arts, literature, arts and crafts and the performing arts; b) Deliverer of newspapers or other publications; c) Babysitter; d) Child who provides homework assistance or tutoring; e) Child working in a family enterprise with fewer than 10 employees if the child is a child of the employer or, where the latter is a legal person or partnership, a child of a director of that legal person or of a partner of that partnership, or if the child is a child of the spouse of one of those persons; f) Child working in a non-profit organization having social or community purposes, such as a vacation camp or recreational organization; g) Child working in a non-profit sports organization to assist another person or provide support, such as an assistant instructor, assistant coach or scorekeeper; h) Child working in an agricultural enterprise with fewer than 10 employees, where the child performs light manual labour to harvest fruits or vegetables, take care of animals or prepare or maintain soil. In this particular case, the child must be 12 years of age or over. Note that for the application of each of the above exceptions, the employer must obtain the consent of the holder of parental authority using the form established by the CNESST9 no later than July 1, 2023. In addition, with respect to the exceptions in paragraphs (e) to (h) above, such children must work under the supervision of a person 18 years of age or over at all times. Maximum number of hours of work: 17 hours per week,10 including a maximum of 10 hours Monday through Friday for children subject to compulsory school attendance, except during periods of more than seven consecutive days without educational services offered to the child. This new labour standard will come into force on September 1, 2023. Notice of termination of employment: No later than July 1, 2023, an employer who employs a child under 14 years of age performing work that is now prohibited must send the child a notice of termination of employment. The length of the notice varies depending on the child’s years of service: - Three months to less than one year of uninterrupted service: one week’s notice - One to two years of uninterrupted service: two weeks’ notice - Two years or more of uninterrupted service: three weeks’ notice The employer may have the child perform work during the period of notice or pay the child a compensatory indemnity equal to the child’s regular wage, excluding overtime, for a period equal to the period or remaining period of notice. The indemnity to be paid to a child who is remunerated in whole or in part by commission is established based on the average of the child’s weekly wage, calculated from the complete periods of pay in the three months preceding the termination of employment. The child may also require the employer to issue a work certificate setting forth the nature and the duration of the child’s employment.11 Should the employer fail to pay the sums to which the child is entitled, the provisions relating to civil recourses set out in the ALS12 will apply. Penalties: An employer who fails to abide by the provisions governing the work of children commits an offence and is liable to a fine under the ALS. Fines are doubled in the event of a repeat offence. Effective date: The Act’s amendments to the ALS and the Regulation came into force on June 1, 2023, with the exception of the maximum number of hours of work for children subject to compulsory school attendance (section 3), which will come into force on September 1, 2023. 2) Amendments to the Act respecting occupational health and safety The Act also amends provisions of the Act respecting occupational health and safety that are already being amended by the Act to modernize the occupational health and safety regime (“Bill 27”), not all of which are currently in force. The amendments introduced by the Act have or will come into force on the same dates as the provisions of Bill 27. The amendments introduced by the Act regarding occupational health and safety include the following: Prevention program: The program must include the identification and analysis of risks that may affect the health and safety of workers in the establishment, but more specifically those affecting workers who are 16 years of age or under. The same applies to establishments subject to the obligation to develop an action plan. Health and Safety Committee: The committee’s functions include participating in the identification and analysis of risks that may affect the health and safety of workers in the establishment, including those that may particularly affect workers who are 16 years of age or under. Health and safety representative and health and safety liaison officer: They identify situations that may be hazardous to workers, including those specific to workers who are 16 years of age and under, and make recommendations to the Health and Safety Committee, the employer and the union, if any, regarding tasks that should not be performed by workers 16 years of age or under. In conclusion, the Act introduces major changes regarding the supervision of work of children, in particular by setting the minimum working age, with certain exceptions, at 14 years of age and by limiting the working week of children subject to the obligation to attend school. Most of these provisions, which came into force on June 1, 2023, require swift action on the part of the employers concerned, and are likely to have a significant impact on work schedules and the available workforce in a number of businesses as the summer approaches. 1 CQLR, c. N-1.1 (the “ALS”). 2 Section 84.2 of the ALS. 3 Section 84.4 of the ALS. 4 Section 14 of the Education Act, CQLR, c. I-13.3. 5 Section 84.5 of the ALS. 6 Section 84.6 of the ALS and section 35.1 of the Regulation respecting labour standards, CQLR, c. N-1.1, r. 3 (the “Regulation”). 7 Section 84.7 of the ALS and section 35.2 of the Regulation. 8 Section 84.3 of the ALS. 9 The CNESST form entitled “Consentement pour le travail d’un enfant de moins de 14 ans” [in French only] can be found here: https://www.cnesst.gouv.qc.ca/fr/organisation/documentation/formulaires-publications/consentement-travail-enfant-moins-14-ans 10 Section 84.4 of the ALS. 11 Section 84 of the ALS. 12 Sections 98 and following of the ALS.
An employer grievance is a means that employers can use to obtain compensation for material damages caused by pressure tactics or to recover overpayments resulting from a union’s wrongdoing. Such a recourse can also be filed to claim damages and legal fees from a union that has abused the grievance arbitration process, in particular by raising grounds that are unfounded or filing applications that are dilatory, or doing either in bad faith. Although not very common, abuse of process does exist and can be sanctioned. However, an employer can successfully raise abuse of rights when a union’s actions are reckless, manifestly ill-founded, done in bad faith or dilatory. Two recent cases The decision in Régie intermunicipale de police Richelieu Saint-Laurent et Fraternité des policiers et policières Richelieu Saint-Laurent1 is an interesting example: The arbitrator ordered the union to reimburse the employer part of the legal costs that it had incurred, as well as the sums paid to three of its witnesses. The case can be summarized as follows. As a result of pressure tactics, three police were summoned to a disciplinary hearing before the discipline committee. The parties agreed in writing to reschedule the hearings before the committee. The officers were finally met in 2014, after which they filed grievances to contest the disciplinary measures taken against them. Arbitration was set for May 2018 and a pre-trial conference was held prior to the hearing. At the hearing, the union raised a preliminary exception on the grounds that the disciplinary measures had been imposed outside the time limit set out in the collective agreement. The employer invited the union to make verifications, maintaining that the parties had agreed to postpone the hearing before the discipline committee. The union upheld its preliminary exception. The employer then filed a grievance, claiming damages arising from the union’s time-barred and unfounded preliminary exception. In January 2019, the parties presented their arguments on the preliminary exception and the employer grievance. On February 14, the union withdrew its preliminary exception during deliberations. The arbitrator allowed the employer grievance in part. He concluded that the exception filed by the union was unfounded and that the latter’s conduct was a clear example of an abuse of legal process. The employer was compensated for the costs incurred in defending itself against the abuse of rights. In Syndicat des professeures(eurs) de l'UQAM (SPUQ) et Université du Québec à Montréal (UQAM),2 the parties had recently renewed their collective agreement and agreed to a clause providing for a reduction in the salary of professors over 70. Shortly after the collective agreement came into force, grievances were filed challenging the discriminatory nature of the clause. UQAM filed an employer grievance alleging abuse of the grievance process by the union. The evidence showed that the union had agreed to the clause even though it knew that it was discriminatory, with the intention of challenging it in arbitration. The union had even asked that the age of the professors be added to the clause, which made its discriminatory nature even more obvious, thereby maximizing its chances of success at arbitration. The arbitrator allowed the employer grievance and ordered the union to reimburse the arbitrator’s fees and disbursements, as well as the professional fees charged by the employer’s lawyer to represent it during arbitration of the union grievance. He concluded that the union’s actions violated the duty to bargain in good faith and constituted an abuse of rights on the union’s part. Key takeaway and helpful tips Abuse of process can take many forms: the use of an unfounded declinatory exception, for example, or the filing of an abusive grievance arising from collective bargaining in bad faith. When confronted with situations not seen in the ordinary course of labour relations, an employer must determine whether there has been abuse of rights. Should abuse of rights be found, the employer could exceptionally claim the professional fees of its lawyers, the cost of summoning witnesses and possibly other damages resulting from the union’s wrongful conduct by filing an employer grievance. However, employers must bear in mind that an ill-founded union grievance, dismissed on the basis that the union’s interpretation of the facts or collective agreement differs from that of the employer, will not necessarily be deemed abusive. In order to win the case, the employer will have to prove that the union’s actions were reckless, manifestly ill-founded, in bad faith or dilatory. It goes without saying that an abuse of procedure by an employer could also be sanctioned by damages. The members of our Labour and Employment Law team are available to advise you and answer your questions. 2021 QCTA 319. 2021 QCTA 296.
Two weeks ago, we published an article on the challenge of retaining your workforce amidst the pandemic. Since that time, two new programs on the subject have been announced by the provincial government. The first is meant to respond to the effects of the Canada Emergency Response Benefit (CERB) on employee retention, while the second promotes worker training. Incentive Program to Retain Essential Workers (IPREW) Although the CERB has been generally well received, it has led to difficulties for certain businesses that provide essential services. This is because the salaries of many workers (particularly those working part-time and those working as cashiers, delivery persons, security guards and maintenance workers) is lower than the CERB. In some cases, employees who were laid off and later recalled to work on a part-time basis felt penalized (unlike the regular Employment Insurance program, the CERB does not allow beneficiaries to keep part of the wages they receive by working). This disadvantage has led to surging rates of absenteeism. To incentivize essential services workers to remain in their posts, the IPREW provides a taxable bonus of $100 per week up to a maximum of $1,600 over the course of the program. This bonus is retroactive to March 15, 2020. The government estimates that 600,000 workers will be able to benefit from the program. Workers must submit their applications online beginning on May 19, 2020. The first payment is scheduled for May 27, 2020. To be eligible for the IPREW, workers must: Be working part-time or full-time in an essential service; Be over 15 years of age and living in Quebec; Earn $550 or less per week for an annual income of no less than $5,000 and no more than $28,600 for the year 2020; and Not be receiving CERB or PATT benefits. Workers whose employers receive financial aid from the federal government are still eligible. Non-essential businesses may want to consider implementing incentives inspired by the IPREW in order to retain their workforce when they are recalled to work following the gradual return to normal activities scheduled to begin on May 4, 2020. Non-essential businesses will most likely face problems similar to those that led to the creation of the IPREW, most notably because the CERB will be available until October 3, 2020. Concerted Action Program to Maintain Employment (PACME) It is reasonable to assume that companies resuming their operations after the province-wide shutdown will need to adopt many new measures, particularly in terms of workers’ health and safety and, as we wrote about last week, telework. Training workers will become even more relevant and essential. The PACME offers an opportunity to be proactive in that regard. PACME offers funding to employers seeking to promote training and best practices, with a special focus on human resource management during the crisis and in preparation for the reopening of the economy. It also aligns well with the federal wage subsidy program. The PACME is available to businesses whose operations have been reduced, suspended, increased or diversified by the crisis, as well as self-employed workers and organizational partners. To learn more about the PACME, please see the article published by our colleagues on the subject. Our Labour and Employment team is available to advise and accompany you throughout the crisis and the reopening process.
Lavery is pleased to announce that a team of five new professionals is joining its Labour and Employment Law group. Richard Gaudreault, Partner Richard Gaudreault’s practice focuses on the negotiation of collective agreements and strategy advising in human resources planning and reorganization for private companies and public institutions. Benoit Brouillette, Partner Benoit Brouillette serves a clientele that includes private, public and parapublic organizations and assists them in their daily and strategic management of human resources and labour relations. Ariane Pasquier, Partner Ariane Pasquier regularly represents her clients in court. Thanks to her negotiating skills, she also represents parties in collective agreement negotiations, particularly in municipal matters. In addition, she has specific expertise in public safety for police forces and fire services. Elizabeth Bourgeois, Associate Elizabeth Bourgeois has gained experience in conflict prevention and resolution, and frequently advises public and private organizations regarding problematic situations that arise in the workplace. Camille Rioux, Associate Camille Rioux advises employers in the public, parapublic and private sectors on issues related to human resources and the development of good labour relations.