CONDOCENTRIC: Legislative Update For Condominiums - Amendments to Statutes and Regulations

Condominium corporations are impacted by legislative changes (in laws) and common law (judicial) decisions regularly in any given year. The nature and scope of the impact on condominium corporations from these changes will depend on the parameters governing the condominium corporation and its operations. From a legislative point of view, provincially and federally, every year there are numerous amendments to statutes and regulations thereunder that can impact the operations of a condominium corporation. While there were a significant number of federal and provincial legislative amendments in 2005, the following highlights some of the more significant and interesting legislative changes or initiatives in 2005.

Bill 21, Energy Conservation Responsibility Act, 2005

On November 3, 2005, Bill 21, the Energy Conservation Responsibility Act, 2005 received its first reading. A key objective of the Bill is to facilitate the implementation of 800,000 smart meters by the year 2010. Smart meters are metering devices that measure and record electricity consumption based on time of use. Currently, the majority of condominium corporations’ bulk meter electricity consumption and cost are shared among unit owners according to the common expense allocations entrenched in each condominium corporation’s declaration. The new proposed legislation will end the cross-subsidization effect that occurs with the bulk metering model and will make each consumer more accountable for the time and amount of electricity he/she individually consumes. Smart metering allows utility providers to record the time of use and distinguish between low, average and high usage periods and accordingly bill consumers at various rates per kilowatt hour. As individuals shift consumption away from times of peak demand, the anticipated and hoped for result is that a decrease in demand will place downward pressure on costs to ultimately lower electricity prices for all consumers. Reducing consumption to off peak periods will hopefully also reduce environmental impact as peak time electricity generation tends to come from the most environmentally harmful electricity generators. The Bill is still in its infancy but smart metering is definitely on the horizon for Ontario condominium owners. For condominium corporations that do not have smart meters, conversion projects will represent costs, as an alteration to the common elements, to come for unit owners.

Employment

As of March 31, 2005, the 60-hour work week ended. Bill 63 came into force on March 31, 2005 and set out a number of rules for employers that want their employees to work in excess of eight hours per day and/or 48 hours per week, or if they want to average their employees working hours to determine overtime pay entitlements. Bill 63 will replace the current Employment Standards Act, 2000 provisions dealing with hours of work and overtime.

Pursuant to Bill 63, employers can only permit or require employees to work more than 48 hours per week where the following takes place:

• the employees have agreed to do so in writing;
• the employer has provided the employees with an information sheet published by the Ministry of Labour setting out their rights and the employer’s obligations respecting hours of work and overtime pay (available at www.gov.on.ca/LAB/english/es/hours/index.html); and
• the employer has applied to and obtained the consent of the director of employment standards (the “director”) approving excess working hours per week.

The first two criteria also apply to excess daily hours (i.e., more than 8 hours per day).

Bill 63 will also require employers to apply to the director for approval to engage in overtime averaging agreements for the purpose of determining overtime pay. Overtime averaging agreements are entered into in writing between an employer and employee in which the parties agree to average the employee’s hours of work over a period of not more than four weeks to determine whether the employee will receive overtime pay. With the approval of the director, an employee and employer can agree to average the employee’s hours of work over a period of more than four weeks. As a result, an employee will qualify for overtime pay if his or her average hours (i.e., the average hours per week during the averaging period) exceed 44 hours. If a condominium corporation employs staff it will have to be cognizant of these requirements.

In October, 2005, the Ontario government announced that is had mandated an increase in proactive employment standards inspections. The Ministry of Labour now has 144 employment standard officers. It is anticipated that these employment standards officers will be carrying out 2,500 surprise workplace inspections, in the 12 months following the announcement, to look for contraventions of the Employment Standards Act, 2000, including violations of overtime hours, minimum wage contraventions, vacation pay and other rights. The general minimum wage was raised to $7.75 per hour on February 1, 2006, and there will be a further increase to $8 per hour on February 1, 2007.

Ending Mandatory Retirement Statute Law Amendments Act, 2005

On December 12, 2005, Bill C-211 received Royal Assent. Known as the Ending Mandatory Retirement Statute Law Amendment Act, 2005, the legislation amends the definition of "age" in various statutes. In section 10 of the Human Rights Code, the previous definition had the effect of permitting discrimination in employment because of age, including mandatory retirement, where the age of an individual was 65 years or more. The new definition of “age” is an age of 18 years or more. Sections 2 to 6 amend or repeal provisions of other Ontario legislation that require persons to retire at a certain age, including the Election Act; Health Protection and Promotions Act, and Ombudsman Act. Section seven of the Bill amends the Workplace Safety and Insurance Act, 1997 to provide that the regulations, decisions and policies under the Act that require or authorize a distinction because of age, continue to apply. Section eight of the Bill provides that the Bill, with the exception of section seven, comes into force one year after Royal Assent. Section seven of the Bill came into force on Royal Assent, December 12, 2005.

Tobacco Control Statute Law Amendment Act, 2005

The Tobacco Control Act, 1994 (“TBCA”) was amended by the Tobacco Control Statute Law Amendment Act, 2005, which amendment also renames the TBCA, the Smoke-Free Ontario Act. Prohibitions have been imposed on smoking in enclosed workplaces, enclosed public places, and certain other places. For live/work condominiums this could have potentially been a problem with respect to prohibiting smoking in an enclosed workplace but the legislation deals with this issue as follows.

“enclosed workplace” means,

1. The inside of any place, building or structure or vehicle or conveyance?or a part of any of them,
   1. That is covered by a roof,
   2. That employees work in or frequent during the course of their employment?whether or not they are acting in the course of their employment at the time, and
   3. That is not primarily a private dwelling.

For the purposes of the definition of “enclosed workplace”, private dwellings include private self-contained living quarters in any multi-unit building or facility and prescribed spaces. Pursuant to subsection 9(2), no person is permitted to smoke tobacco or hold lighted tobacco in any common area in a condominium, apartment building or university or college residence, including, without being limited to, elevators, hallways, parking garages, party or entertainment rooms, laundry facilities, lobbies and exercise areas.

Assessment Act

Pursuant to subsection 14.2(4) of the Assessment Act and the regulations thereunder, taxation of units deemed to be within the “Resort Condominium Property Class” commenced in the taxation year of 2005. The Resort Condominium Property Class applies within a municipality, the council of which is required to pass a by-law establishing tax ratios under section 308 of the Municipal Act, 2001, only if the council has passed a by-law opting to have the Resort Condominium Property Class apply within the municipality. The Resort Condominium Property Class includes land in respect of which all of the prescribed criteria under section 14.2 are satisfied. Owners of there type of condominiums will most likely be facing higher tax bills to recognize the income earning potential of their units.

Spousal Relationships Statute Law Amendment Act, 2005

The Spousal Relationship Statute Law Amendment Act, 2005 was introduced to recognize same sex unions in a significant number of statutes including the Business Corporations Act, Human Rights Code, Insurance Act, Pension Benefits Act, Mortgages Act, Substitute Decisions Act, 1992, Tenant Protection Act, 1997, Workplace Safety and Insurance Act, 1997. Subject to certain exceptions, this Act came into force on the day it received Royal Assent, March 9, 2005. Condominium corporations should generally be sensitive of this change in its dealings with unit owners and their spouses.

From "CondoBusiness Magazine”, March 2006, pg. 26

All of the information contained in this article is of a general nature for informational purposes only, and is not intended to represent the definitive opinion of the firm of Elia Associates on any particular matter. Although every effort is made to ensure that the information contained in this newsletter is accurate and up-to-date, the reader should not act upon it without obtaining appropriate professional advice and assistance.

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