As businesses face the far-reaching effects of tariffs and ongoing economic uncertainty, there has never been a more crucial time to revisit and refine your employment agreements.

The landscape of employment law is constantly evolving, and the recent imposition of tariffs has added new layers of complexity for employers trying to adapt to the shifting market conditions. A thoughtfully crafted employment agreement is not just essential for ensuring compliance with employment standards and provincial legislation, it also provides the flexibility needed to navigate these unpredictable times.

To help stay ahead of the curve, here are five key areas to consider when reviewing your employment contracts:

1. Temporary layoffs

Temporary layoffs, once an uncommon practice in some sectors, have become more prevalent in the wake of economic challenges, and will surely rise further with the introduction of tariffs. While temporary layoffs can be a useful tool for employers facing periods of reduced business activity or economic strain, they must be carefully managed to avoid legal pitfalls.

Notwithstanding that some employment standards legislation provides a right to lay off employees, such a layoff may still give rise to a constructive dismissal claim if not addressed in an employment agreement.

Employers should ensure that their employment agreements clearly outline the conditions under which temporary layoffs can occur to avoid confusion and reduce the potential for claims of...

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