Legal Department Advisory – Canada Labour Code – Paid Medical Leave (Section 239)

This advisory provides information about the new paid medical leave entitlement under Section 239 of the Canada Labour Code (the “Code”).

The Code only applies to federally-regulated employees. Section 239 forms part of Part III of the Code. Part III of the Code is about minimum labour standards.

This new entitlement was enacted in December 2021 but it will only now come into force on December 1, 2022.

Effective December 1, 2022, eligible employees in the federal sector are entitled to 10 paid medical leave days per calendar year for medical leaves of absence (“Paid Medical Leave”).

This advisory has two parts:

1. a review of the new Paid Medical Leave statutory provisions; and
2. a review of how the Paid Medical Leave entitlement will interact with collective agreement entitlements.

1. Paid Medical Leave

A medical leave of absence under Section 239 may be taken for the following reasons:

• • personal illness or injury of the employee;
  • organ or tissue donation;
  • medical appointments for the employee during working hours; or
  • quarantine of the employee.

Subsection 239(1) already provides that an employee is entitled to unpaid medical leave for up to 27 weeks. The unpaid leave entitlement was recently amended from 17 to 27 weeks to align with an extension of EI sickness benefits effective December 18, 2022 (here and here).

Effective December 1, 2022, Section 239 of the Code is amended to entitle eligible employees to 10 paid days for medical leaves of absence.

The new Paid Medical Leave is an accruing benefit and will apply for any of the reasons an employee may take a medical leave of absence under Section 239 listed above.

1. Eligibility – Subsection 239(1.2)

All employees who complete 30 days of continuous service will earn three days of paid medical leave. After that, they will accrue one day of paid medical leave per calendar month, to a maximum entitlement of 10 days per year.

The new benefit is not pro-rated for the year 2022. This means that employees employed on December 1, 2022, will accrue 3 paid days as of December 31, 2022. The fourth paid day will accrue on February 1, 2023. Employees hired after December 1, 2022 will accrue three paid days upon completion of 30 days of continuous employment, and one per calendar month thereafter.

2. Maximum of 10 Days – Subsection 239(1.21)

An employee will be entitled to earn up to 10 days of Paid Medical Leave each year.

3. Rate of Pay – Subsection 239(1.3)

Each day of Paid Medical Leave must be paid at an employee’s “regular rate of wages for their normal hours of work”. Section 17 of the Canada Labour Standards Regulations clarifies that if an employee has hours of work that differ from day to day or is paid on a basis of other than time, “regular rate of wages” shall mean:

1. the average of the employee’s daily earnings, exclusive of overtime hours, for the 20 days the employee has worked immediately preceding the first day of the period of paid leave; or
2. an amount calculated by a method agreed upon pursuant to a collective agreement.

4. Carry Forward – Subsection 239(1.4)

Employees will be able to carry over accrued but unused Paid Medical Leave days to the next year, but doing so will reduce the maximum number of paid days they accrue in that year by the number of days carried over. This means that an employee will not lose accrued entitlements at the end of a year if they have not used their Paid Medical Leave entitlement.

For example, if an employee has 6 unused Paid Medical Leave days at the end of a year, those days will carry over to the next year, but the employee will only be eligible to accrue 4 more Paid Medical Leave days in that year, to a total of 10 for the year.

5. Division of Leave with Pay – Subsection 239(1.5)

Paid Medical Leave may be taken in one or more periods, but an employer can require that each period be at least one day. In other words, an employer may prevent employees from using partial days.

6. Medical Notes – Subsection 239(2)

If an employee has taken a medical leave of absence with or without pay of at least five consecutive days, an employer is permitted to ask the employee to provide a medical note issued by a health care practitioner certifying that the employee was incapable of working for the period of their leave. An employer must make this request in writing and no later than 15 days after the employee’s return to work.

7. Section 189 of the Code – Subsection 239(14)

Section 189 of the Code protects employees whose employment is transferred as the result of a sale of business, or due to a contract being awarded through a retendering process. Under this section, employment with the former employer is considered continuous employment with the subsequent employer.

If an employer changes because of a sale of business or a contract being awarded through a retendering process, employment is deemed to be continuous employment with the new employer for purposes of determining eligibility to Paid Medical Leave under Subsection 239(1.2).

8. Calendar Year vs. Date Used to Calculate Annual Vacation – Paid Medical Leave Regulations (Section 33.1)

Effective December 1, 2022, the Canada Labour Standards Regulations are amended to include rules applicable to the new Paid Medical Leave. Under Section 33.1 of the regulations, employers that use a year other than a “calendar year” to calculate annual vacation may use that same year to calculate paid medical leave entitlements.

This means an employer may choose to use the date it uses to calculate annual vacation for matters concerning Paid Medical Leave instead of the calendar year.

1. Business Size

The new Paid Medical Leave entitlement will apply to all eligible federal sector employees, regardless of the size of their employer.

10. Personal Leave under Section 206.6 of the Code

The amendments to the Code remove “personal illness or injury” from the reasons that Personal Leave may be taken under Section 206.6 of the Code. Following the amendments, Personal Leave may still be taken for up to five days per year for various reasons, including family responsibilities, urgent matters concerning employees or their families, or employees attending their citizenship ceremonies, and three of the five days are paid if an employee has worked for an employer for three months or more.

2. Paid Medical Leave and Collective Agreements

1. ESDC Guidelines

Employment and Social Development Canada (“ESDC”) has published two Interpretation, Policy and Guideline documents for the new Paid Medical Leave (Medical leave with pay – IPG-118 and Stacking – Medical Leave with Pay – IPG-119) (the “Guidelines”), effective December 1, 2022.

The Guidelines provide clarification about the scope of the new Paid Medical Leave where employees already have some entitlement to paid sick days under a collective agreement.

The Guidelines explain that employees will not be able to access both the new Paid Medical Leave days with existing paid sick leave entitlements if an employee’s collective agreement already contains paid sick leave entitlements that are at least as favourable as the new Paid Medical Leave. The Guidelines should be reviewed carefully though they are not law. They are only an interpretation of the new provisions by ESDC.

2. Section 168 of the Code

The Paid Medical Leave entitlement applies to all employees Paid Medical Leave will apply to all employees, including those covered by a collective agreement. However, Section 168(1) specifies that the Code does not affect any rights or benefits under a collective agreement that are more favourable to an employee.

Section 168(1) ensures that parties cannot agree to reduce the protections of Part III of the Code. Grievance arbitrators have jurisdiction to determine whether an employer is complying with the statutory floor set by Part III.

Section 168(1) requires determining whether an employee will be entitled to the entitlements under their collective agreement and the entitlements under the Code, or if taking a paid sick day under a collective agreement will also count as a Paid Medical Leave day under the Code.

3. Comparing Collective Agreement and Statutory Entitlements

Section 168(1) requires a comparison between any paid sick leave entitlement under a collective agreement with the new Paid Medical Leave entitlement. This should be an “apples to apples” comparison. If an existing benefit is different in scope or purpose and not directly related to a leave for medical reasons in Section 239(1), then the benefit should be considered separate and will not reduce an employee’s Paid Medical Leave entitlement. For instance, floater days or personal leave days that can be used for non-medical reasons, or medical leave days that can also be used for non-personal medical reasons (e.g., injury or illness of a child or dependent), will not have the same scope and purpose as Paid Medical Leave.