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Appeal court overturns ruling that COVID-related layoffs preclude constructive dismissal claims

The Ontario Court of Appeal has overturned the motion judge’s decision in the Taylor v Hanley Hospitality case that concluded that the Infectious Disease Emergency Leave Regulation (IDEL Regulation) precluded a constructive dismissal claim at common law.

Since last spring and COVID’s avalanche of layoffs, employment lawyers in Ontario awaited the appeal court’s decision to see whether temporary layoffs made under IDEL regulation would count as a constructive dismissal under common law. However, the appellate court declined to deal with the issue as it found that the motion judge made numerous errors under the Rules of Civil Procedure.

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