Ontario employers using temporary layoffs should review their record-keeping practices.

The Working for Workers Seven Act, 2025 amended the ESA and received Royal Assent on November 27, 2025. Among other changes, the legislation added a new record-keeping requirement for extended layoff agreements.

What changed?

Employers must retain, or arrange for someone else to retain, copies of every agreement for an extended layoff for three years after the approval of the extended layoff expires.

Why does this matter?

Temporary layoffs can be legally sensitive in Ontario. Employers should already be careful before using temporary layoffs, especially where there is no contractual right to lay off employees.

This new record-keeping requirement adds another compliance step for employers that use extended layoff arrangements.

What should employers do?

Employers should ensure they have a central process for retaining:

• employee layoff agreements;
• approvals for extended layoffs;
• related communications;
• return-to-work notices;
• payroll records; and
• any employee consent documentation.

Employer takeaway

Employers should not rely on informal or decentralized layoff records. If extended layoffs are used, the supporting documents should be stored in a way that can be retrieved if challenged or audited.

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