Most employees in Canada are governed by provincial or territorial employment laws. However, employees in certain industries and workplaces are federally regulated and may instead be covered by the Canada Labour Code.
Knowing whether you are federally or provincially regulated is important because it can affect your rights relating to hours of work, overtime, leaves, termination, severance, unjust dismissal and other workplace issues.
What Is the Difference Between Federally and Provincially Regulated Employment?
The main difference is which level of government has jurisdiction over the employment relationship.
Most employees in Canada fall under the employment standards legislation of the province or territory where they work. Employees in federally regulated industries and workplaces may instead be governed by the Canada Labour Code.
Whether an employee is federally or provincially regulated generally depends on the nature of the employer’s business and operations, not simply where the employee physically works.
For example, an employee working for a bank in British Columbia, Alberta or Ontario may be federally regulated because banking falls under federal jurisdiction. By contrast, an employee working for a retail store in any of those provinces would generally be provincially regulated.
Federal vs. Provincial Employment Regulation in Canada
| Federally Regulated Employees | Provincially or Territorially Regulated Employees | |
|---|---|---|
| Employment standards legislation | Canada Labour Code | Employment standards legislation of the applicable province or territory |
| Jurisdiction | Federal | Provincial or territorial |
| Examples of workplaces | Banks, telecommunications, airlines and certain interprovincial or international transportation businesses | Most businesses and workplaces operating within a province or territory |
| Employment standards authority | Federal Labour Program | Applicable provincial or territorial employment standards authority |
| Human rights legislation | Canadian Human Rights Act may apply | Applicable provincial or territorial human rights legislation |
| Unjust dismissal | May be available to eligible employees under the Canada Labour Code | No identical Canada-wide provincial equivalent |
What Is a Provincially Regulated Employer?
A provincially regulated employer is generally an employer whose business falls under provincial rather than federal jurisdiction.
Most employers and employees in Canada are provincially regulated.
This includes many businesses operating within a province, such as retail stores, restaurants, professional services, construction companies, manufacturers and other local or regional businesses.
Each province and territory has its own employment standards legislation establishing minimum rights relating to matters such as wages, hours of work, overtime, vacation, holidays, leaves and termination of employment.
What Is a Federally Regulated Employee?
A federally regulated employee works in an industry or workplace that falls under federal jurisdiction.
Part III of the Canada Labour Code establishes minimum employment standards for employees in federally regulated workplaces covered by that part of the Code.
The Government of Canada identifies federally regulated industries and workplaces that include areas such as:
- banks;
- airlines, airports and air transportation;
- telecommunications, including telephone, internet and cable systems;
- radio and television broadcasting;
- postal and courier services;
- railways crossing provincial or international borders;
- road transportation crossing provincial or international borders;
- marine shipping, ports and certain ferries;
- pipelines crossing provincial or international borders;
- uranium mining and processing and atomic energy; and
- most federal Crown corporations.
For specific examples of companies and industries, see Monkhouse Law’s List of Federally Regulated Employers and Industries in Canada.
How Do I Know If My Employer Is Federally or Provincially Regulated?
The name, size or geographic reach of a company does not necessarily determine whether its employees are federally regulated.
A company operating in several provinces is not automatically federally regulated. The nature of the business and its operations are important.
Similarly, working in a particular province does not necessarily mean that provincial employment standards legislation applies. An employee may work entirely within one province while still working for a federally regulated employer.
In some cases, determining jurisdiction can be more complicated. A business may provide services to a federally regulated company without necessarily being federally regulated itself.
Employees who are unsure can start by determining whether their employer operates within one of the industries under federal jurisdiction. Monkhouse Law also maintains a searchable list of federally regulated employers and industries in Canada.
Canada Labour Code vs. Provincial Employment Standards Laws
The Canada Labour Code establishes minimum employment standards for federally regulated workplaces covered by the Code.
Provincially regulated employees are governed by the employment standards legislation of their province or territory.
Although these laws address many similar subjects, including wages, hours of work, vacations, leaves and termination, the specific rules and remedies can differ depending on jurisdiction.
The Government of Canada’s overview of the Canada Labour Code explains the different parts of the Code and the workplaces and employment matters they regulate.
Unjust Dismissal for Federally Regulated Employees
One important difference for some federally regulated employees is the unjust dismissal protection contained in the Canada Labour Code.
Under section 240 of the Canada Labour Code, an employee who has been dismissed and considers the dismissal unjust may be eligible to make an unjust dismissal complaint.
Generally, an employee must have completed at least 12 consecutive months of continuous employment with the employer and must not be covered by a collective agreement. Other eligibility requirements and exclusions can also apply.
An unjust dismissal complaint generally must be filed within 90 days of the dismissal.
If the Canada Industrial Relations Board determines that an employee has been unjustly dismissed, remedies may include compensation, reinstatement and other equitable relief.
For a detailed explanation of eligibility, deadlines and the complaint process, see Monkhouse Law’s guide to unjust dismissal for federally regulated employees.
Monkhouse Law has also successfully represented a federally regulated bank employee in M. v. Bank of Montreal, where the employee was reinstated following a finding of unjust dismissal.
Unjust Dismissal vs. Wrongful Dismissal
Unjust dismissal and wrongful dismissal are different legal concepts.
The unjust dismissal provisions of the Canada Labour Code provide eligible federally regulated employees with a statutory process for challenging a dismissal they consider unjust.
Wrongful dismissal generally concerns whether an employee received the notice of termination or compensation they were legally entitled to receive. The applicable rights can depend on federal or provincial employment standards legislation, the employment contract and the common law.
Learn more about unjust dismissal under the Canada Labour Code.
Human Rights for Federally Regulated Employees
Federal and provincial workplaces can also fall under different human rights regimes.
Employees in federally regulated workplaces may have protections under the Canadian Human Rights Act.
Provincially regulated employees are generally protected by the human rights legislation of the province or territory where their employment falls.
This distinction can affect where an employee brings a complaint involving workplace discrimination or harassment.
What Does This Mean for Employees in Ontario?
If you are employed in Ontario, most provincially regulated workplaces are governed by Ontario’s Employment Standards Act, 2000.
The ESA establishes minimum employment standards relating to matters such as wages, hours of work, overtime, vacation, public holidays, leaves, termination pay and severance pay.
Ontario employees may also have rights beyond the minimum standards in the ESA, including contractual or common law rights following termination.
Employees can learn more about wrongful dismissal in Ontario and severance pay in Ontario.
Frequently Asked Questions About Federal and Provincial Employment
Are banks federally regulated in Canada?
Yes. Banks are federally regulated in Canada. Employees working for banks may therefore be covered by federal labour standards under the Canada Labour Code rather than provincial employment standards legislation.
Monkhouse Law has successfully represented a bank employee who obtained reinstatement after an unjust dismissal.
Is telecommunications federally regulated in Canada?
Yes. Telecommunications systems, including telephone, internet and cable systems, are among the industries identified by the Government of Canada as federally regulated.
Are all companies operating across Canada federally regulated?
No. Operating in more than one province does not automatically make an employer federally regulated. Whether federal jurisdiction applies depends on the nature of the business or undertaking.
What does federally regulated mean?
In an employment context, federally regulated generally means that the workplace falls under federal jurisdiction and applicable federal employment legislation rather than provincial or territorial employment standards legislation.
Who does the Canada Labour Code apply to?
Different parts of the Canada Labour Code apply to different federally regulated workplaces and employment matters. Part III establishes minimum employment standards for workplaces covered by that part of the Code.
How can I find out if my employer is federally regulated?
Start by determining whether your employer operates within an industry or workplace under federal jurisdiction. You can review the Government of Canada’s federally regulated industries and workplaces or Monkhouse Law’s List of Federally Regulated Employers and Industries in Canada.
Speak With an Employment Lawyer
The distinction between federally and provincially regulated employment applies across Canada. Each province and territory has its own employment standards legislation, while federally regulated employees across the country may be covered by the Canada Labour Code.
Monkhouse Law is an Ontario employment law firm and represents employees throughout Ontario. This includes both provincially regulated employees covered by Ontario employment laws and federally regulated employees who work in Ontario in industries such as banking, telecommunications, aviation and interprovincial transportation.
If you work in Ontario and have been terminated, offered a severance package, experienced a workplace issue or are unsure whether federal or Ontario employment laws apply to you, contact Monkhouse Law to speak with an employment lawyer about your situation.