Medical leave with pay - No stacking - IPG-119

Subject

The intent of this Interpretation, Policy and Guideline (IPG) is to define the scope of the medical leave with pay provided for in section 239 of Part III of the Canada Labour Code (Code), where a collective agreement or contract of employment grants an employee days of leave (with pay) for 1 or more of the reasons listed in subsection 239(1) of the Code.

Note: “employees” also includes “interns”. Student interns are not subject to the interpretation of this IPG.

There is a need to clarify how benefits offered by an employer interact with the medical leave with pay entitlement established in the Code. These legislative provisions are not intended to result in stacking of benefits. No stacking will occur when an employer already provides an equal or greater existing paid leave or benefit that serves the same purpose as medical leave with pay.

Issue

There is a need to ensure a consistent interpretation of the application of section 239 (medical leave with pay) of the Code. This IPG addresses the following:

• how this leave applies to an employee who is covered by a collective agreement or employment contract that provides a similar type of leave
• the interaction between an employer leave benefit and the medical leave with pay
• factors that need to be considered when determining whether an employer leave benefit meets the requirements of the medical leave with pay under the Code

Interpretation

Effective December 1, 2022, all employees in federally regulated workplaces, regardless of their employment status (full-time, part-time, casual, probationary, etc.), who complete an initial 30-day qualifying period of continuous employment with their employer are entitled to 3 days of medical leave with pay. Employees are then entitled to an additional day of medical leave with pay at the beginning of each month after completing 1 month of continuous employment with the employer up to a maximum of 10 days per year. An employee may take this leave for the following reasons:

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

This leave is not pro-rated for the year 2022. As a result, employees already employed on the coming into force date of December 1, 2022 are entitled to 3 days of medical leave with pay after completing an initial 30-day qualifying period of continuous employment with their employer.

Leave taken prior to December 1, 2022, before the coming into force of the Code's medical leave with pay provisions, cannot count towards the employee's medical leave with pay entitlement under the Code as the Code entitlement is based on future accrual.

Interaction of medical leave with pay with employer benefits

The medical leave with pay requirements under the Code are not intended to impact employers who already offer equal or greater paid leave benefits designed to cover employee illness or other medical-related absences.

While there is a distinction between the medical leave with pay and the benefits some employers already provide, they are not meant to interfere. Duplication or stacking of benefits is not the intent when an employer provides a benefit which serves the same purpose as the medical leave with pay under the Code.

If an employee is already entitled to paid leave that is designed to cover employee’s illness or medical-related absence, then taking a day of such leave could count as a day of medical leave with pay under the Code.

The medical leave with pay is a minimum standard. If an employer already provides an existing paid leave or benefit that serves the same purpose as medical leave with pay that is equal to or greater than the leave entitlement, then the existing employer leave or benefit could be considered to meet the minimum standard under the Code.

Subsection 168(1) applies to the entirety of Part III of the Code, including the provisions related to medical leave with pay in Division XIII.

• this subsection makes it clear that the provisions of Part III of the Code apply notwithstanding any other contract or arrangement
• however, this subsection also specifies that, the provisions of Part III of the Code do not affect any rights or benefits under a contract or arrangement that are more favourable to an employee

A paid sick leave benefit that is equal to or greater than what an employee would be entitled to under the Code would not result in a stacking of benefits. Where a benefit is equal or more generous, medical leave with pay requirement could be considered to have been met. This would be the case, for example, if an employer chooses to offer employees 10 days of paid sick leave at the start of each year rather than require them to accrue days of leave over a longer period, as provided for under the Code.

A paid sick leave benefit that is less favourable than what an employee would be entitled to under the Code would not be considered to be in compliance. Employees would be entitled to medical leave with pay as provided for under the Code in these circumstances.

Duplication or stacking of benefits is not the intent when an employer provides an equivalent or equal benefit. Code entitlements would not stack on top of employer provided benefits as long as both serve the same purpose and the criteria described below are met.

Purpose of the benefit

Medical leave with pay provision is intended to give employees access to paid leave for any of the following medical reasons:

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

In order for a day of paid sick leave under an employment contract or collective agreement to count as a day of medical leave with pay under the Code, the employer benefit must be of the same type and must serve the same purpose. In these instances, the employer may reduce the employee’s Code entitlement accordingly.

If an employer benefit serves a different purpose than medical leave with pay under the Code, and is not directly related to leave for medical reasons, then that benefit is considered separate and would not reduce the employee's medical leave with pay entitlement. Examples of benefits that do not serve the same purpose include: floater holidays; all-purpose leave that could be used to extend a vacation.

The medical leave with pay entitlement under the Code must be compared against a paid sick leave benefit provided by the employer, and not against broader benefits under an employment contract or collective agreement. This comparison must consider the purpose of the employer benefits and the purpose of the statutory entitlement under the Code. For example, benefits such as additional vacation or additional holidays, or more favourable paid personal leave cannot be compared against and cannot count as medical leave with pay.

Alongside the coming into force of the medical leave with pay provisions of the Code, amendments were made to subsection 206.6(1), i.e. the entitlement to personal leave. These amendments removed treating illness or injury as a reason for employees to take personal leave under the Code. As a result, medical leave with pay and personal leave are now 2 distinct entitlements which serve different purposes. Employers must ensure that both are provided.

Meeting the Code's requirements

Periods of paid sick leave taken under the terms of a collective agreement or employment contract could count towards an employee's entitlement to medical leave with pay under the Code if all of the following criteria are satisfied:

• the employee can take the leave provided for under the collective agreement or contract of employment for 1 or more of the reasons listed above
• the employee may take the leave in 1 or more periods. The employer may require that each period of leave be of not less than one day's duration
• the employer does not require that the employee provides a medical certificate if they are absent for fewer than 5 consecutive days
• the employee is entitled to:
  • receive their regular rate of wages for each day of the leave
  • maintain and accumulate pension, health and disability benefits, as well as seniority, during the leave, and
  • be reinstated after the end of the leave

Medical leave with pay under the Code is considered to be wages, including for the purposes of vacation pay entitlements. Medical leave with pay is subject to the record keeping provisions.

For further information on the above Code requirements please consult IPG-118.

Examples

Example 1: Coming into force and accrual of medical leave with pay

Example 1

Nia is subject to a collective agreement. The collective agreement provides her with 10 days of paid sick leave per calendar year, and the purpose and conditions of that benefit are the same as the medical leave with pay provided by the Code.

Nia takes 5 paid sick leave days provided under her collective agreement in January 2022, and 5 more in November 2022. By the end of November 2022, Nia has used up all of her paid sick leave for the 2022 calendar year under the terms of the collective agreement.

On December 1, 2022, the medical leave with pay provisions of the Code come into force and, after the initial 30-day qualifying period, Nia earns her first 3 days of medical leave with pay on December 31, 2022. As a result, Nia is able to take 1 of the 3 days of medical leave with pay on December 31, 2022.

As noted above, under the provisions of the Code, the accrual of medical leave with pay begins on the date those provisions come into force with no regard to paid sick leave taken by an employee prior to their coming into force.

Examples 2-4: Existing leave benefit serves the same purpose as Code entitlement and complies with the Code – No stacking of benefits

Example 2

Matt is subject to a collective agreement. The paid sick leave benefit under the collective agreement is much more favourable than that provided by the medical leave with pay provisions under the Code.

Under his collective agreement, Matt receives 20 days of paid sick leave per calendar year, available to him as of January 1 each year. The sick leave is paid at the same rate of pay as his regular wages. Matt can take the paid sick leave for all of the reasons provided in the Code (for example, personal illness or injury, organ or tissue donation, medical appointments and quarantine). All unused days are carried forward to the next calendar year, and never expire.

The medical leave with pay provisions of the Code come into effect on December 1, 2022, and Matt begins to accrue medical leave with pay under the Code. Throughout 2023, Matt does not take any sick leave at all. At the start of 2024, Matt has accrued and banked 10 days of medical leave with pay under the Code. Alongside this, Matt's bank of paid sick leave under his collective agreement sits at 60 days.

In February 2024, Matt takes 10 days of leave due to personal illness. This reduces his paid sick leave bank under his collective agreement by 10 days, to 50. It also reduces Matt's entitlement to medical leave with pay under the Code by 10 days, to 0. In practice, due to the fact that the sick leave benefits provided under Matt's collective agreement are directly related to (and are in fact much more favourable than) the medical leave with pay provided under the Code, these benefits do not stack.

Example 3

Ana is subject to a collective agreement that provides her with 10 days of paid sick leave per year. The sick leave provisions in her collective agreement are identical to the medical leave with pay provisions of the Code with 1 exception – the leave under the terms of the collective agreement can only be used for personal illness or injury. The medical leave with pay provided under the Code can be used for any of the following reasons: personal illness or injury, organ or tissue donation, medical appointments and quarantine.

Ana falls ill and uses all 10 paid sick leave days provided under her collective agreement, reducing her bank to 0. Later that year, Ana decides to donate a kidney to a friend in need. Ana wants to use additional medical leave with pay for the surgery and the post-surgery recovery.

Ana's collective agreement does not allow the use of paid sick leave for organ donation; the existing benefit contained in her collective agreement is therefore less favourable than the medical leave with pay provided by the Code. However, since Ana did receive and use 10 days of paid sick leave for 1 of the reasons listed in the Code, she is not entitled to additional medical leave with pay for the purposes of the organ donation.

Example 4

Angèle is subject to a collective agreement. The collective agreement provides her with 10 days of paid sick leave, which is fully earned and available to her on the first day of every calendar year. The other terms and conditions related to the paid sick leave provided under the collective agreement are identical to what is provided under the Code, with 1 exception: none of the unused days can be carried forward from 1 year to the next.

Although unused days of paid sick leave cannot be carried forward from 1 year to the next, Angèle will start every calendar year with 10 days of paid sick leave available to her. This is a greater benefit than the entitlement to medical leave with pay under the Code. As a result, Angèle will not have access to additional days of medical leave with pay.

Example 5: Existing leave benefit serves the same purpose as Code entitlement but is less favourable than the Code – Employer can take steps to comply with the Code and avoid stacking

Example 5

Ty is subject to a collective agreement that provides him with 10 days of paid sick leave per year. The sick leave provisions in his collective agreement are identical to the provisions of the Code with 1 exception – the leave under the collective agreement is paid at only 75% of an employee's regular rate of wages. The rate of pay in the collective agreement (75%) is not as favourable as the minimum rate of pay under the Code (100%).

Ty's employer decides to top up the employees' rate of pay when they take paid sick leave, paying the additional 25% of wages over and above what the collective agreement requires, every time an employee takes paid sick leave. By doing so, Ty’s employer would meet the requirements of the Code. In practice, every time Ty takes paid sick leave under his collective agreement and is paid 100% of his wages, his employer may reduce his entitlement to medical leave with pay under the Code accordingly.

Example 6: Existing leave benefit serves the same purpose as Code benefit but is less favourable than the Code – The 2 can be combined to avoid stacking

Example 6

Amalia's employment contract provides 2 paid sick leave days per year. The paid sick leave provisions in the contract are identical to the medical leave with pay provisions of the Code with the exception that only 2 paid sick leave days are provided per year, rather than 10.

Amalia’s entitlement to medical leave with pay under the Code applies notwithstanding the benefits provided to her in the employment contract. That is to say, Amalia is entitled to both the 2 days of paid sick leave under her employment contract as well as the 10 days of medical leave with pay under the Code. However, in practice, since the purpose and conditions related to the paid sick leave under her contract are identical to the purpose and conditions related to medical leave with pay under the Code, every time Amalia takes paid sick leave under her contract, her employer may reduce her entitlement to medical leave with pay under the Code accordingly.

As a result, if Amalia chooses to first use the 2 days of sick leave provided by her contract, she would then be entitled to up to 8 more days of medical leave with pay for the remainder of the year, based on the accrual rate provided for under the Code.

Examples 7-8: Existing leave benefits serves a different purpose than the Code entitlement – Both leaves must be provided

Example 7

Robin's employment contract provides them with no paid sick leave, but it does provide 3 floater days at the beginning of each year, to be used regardless of the reason for the leave. The contract makes it clear that these floater days are meant as additional paid holidays (in addition to the 10 general holidays provided under the Code).

Robin has accrued and banked 10 days of medical leave with pay under the provisions of the Code.

The purpose of the 2 types of leave is different: the floater holiday leave provided under the contract is meant to provide employees with additional days to rest or pursue other interests, while the medical leave with pay provided under the Code is meant to provide employees with paid days off for situations related to medical matters.

Robin catches a cold and stays home from work for 3 days in a row. Robin informs their employer that they would like to use their 3 floater days to cover this period.

Later in the year, Robin again falls ill, this time missing 10 days of work. Their employer informs Robin that only the first 7 days of this period will be paid, and the last 3 days will be treated as unpaid leave since they already used 3 floater days for purposes related to medical matters. This is not in compliance with the Code.

Since the purpose of the 2 leaves is different, Robin is entitled to both 10 days of medical leave with pay under the Code and the 3 floater days provided under their contract of employment.

Example 8

Sharmaine's employment contract provides her with no paid sick leave. However, her contract does provide her with 3 floater days at the beginning of each year, to be used at her discretion. The contract makes it clear that these floater days are meant as additional paid holidays (in addition to the 10 general holidays provided under the Code).

Sharmaine has accrued and banked 10 days of medical leave with pay under the provisions of the Code.

The purpose of the 2 types of leave is different: the floater holiday leave provided under the contract is meant to provide employees with additional days to rest or pursue other interests, while the medical leave with pay provided under the Code is meant to provide employees with paid days off for situations related to medical matters.

Sharmaine sprains her finger and is absent from work for a day. She informs her employer that she is taking a paid leave day due to the injury. She returns to work the next day and her employer informs her that her bank of paid floater days is reduced from 3 to 2.

Sharmaine's employer cannot force Sharmaine to use her floater days as medical leave with pay as the decision to use her banked medical leave with pay belongs to her as the employee. Sharmaine is entitled to both 10 days of medical leave with pay under the Code and to the 3 floater days under her contract of employment.