(Good) Closing Your Business for the 2010 Games


Planning on shutting down the business temporarily? Here are a few things of which employers and employees should take note.

For a variety of reasons – inability to get supplies, reduced demand for services or products, or limited access to their operations – a number of businesses are planning to shut down during the 2010 Winter Games.

For employers, the question then arises: how do you manage this temporary closure without inadvertently triggering a termination and resulting severance liability?

Mandatory Vacation

One strategy for managing a temporary closure of a business is to require all employees to take vacation during the period of time the business is to be closed. Employers have the legal right to determine when an employee will take vacation, provided that the vacation is in periods of one or more weeks at a time.

If employees do not have enough accrued, paid vacation to treat the proposed business closure as paid vacation, employers may ‘advance’ their employees paid vacation that they have not yet accrued – provided that they comply with Section 59 of the BC Employment Standards Act. But employers should also consider this possibility: employees who requested an advance on paid vacation may resign or be terminated before they work long enough to have earned the paid vacation.

Temporary Layoffs

Employers may not require their employees to take unpaid time off – or temporarily lay off their employees without the employees’ consent – unless the employer has an employment agreement or collective agreement that allows them to temporarily lay off employees. Thus any unilateral decisions by an employer to schedule unpaid time off during the Winter Olympics will be considered a constructive dismissal.

Any decision to place employees on unpaid time off must be agreed to by the employee. Because the employer has onus for proving the employee consented to a temporary layoff, employers are advised to get such agreements confirmed in writing.

This article is intended to inform businesses on employer’s rights and legal obligations related to planning a temporary closure of business operations for the Winter Olympics in Vancouver in February 2010. With this information, employers can consider what approach might work for the business and their employees.