Federal Employment Law Changes Canadian Employers Must Know — March 2026 Update

Several significant amendments to the Canada Labour Code now shape day-to-day obligations for federally regulated employers. Federal Minimum Wage The federal minimum wage is $18.15 per hour , effective as of April 1, 2026. The rate is adjusted annually based on the Consumer Price Index, and the next adjustment takes effect on April 1, 2026. Employers can confirm the current rate on the federal minimum wage page on canada.ca. 10 Paid Medical Leave Days Federally regulated employees who have completed 30 days of continuous employment are entitled to 10 days of paid medical leave per year under Division XIII.01 of the Code. This entitlement is already in force and applies across banking, telecommunications, interprovincial transportation, and Crown corporations. New and Enhanced Leaves (Effective December 12, 2025) Pregnancy Loss Leave: Up to 8 weeks of unpaid leave following a stillbirth, plus 3 paid days for other pregnancy losses. Enhanced Bereavement Leave: Up to 8 weeks of unpaid leave following the death of a child. Placement of Child Leave: A 16-week unpaid leave for the placement of a child through adoption or surrogacy has been enacted but will come into force on a date fixed by Order in Council (expected late 2026) — this is the next major federal leave milestone to watch. The aligned Employment Insurance amendments are being finalized for a late 2026 rollout. It will come into force on a date fixed by Order in Council. Worker Misclassification and Wage Theft Enforcement Budget 2025 allocated $77 million over four years for CRA measures addressing worker misclassification and related tax non-compliance. Budget 2025 also proposes substantially increased penalties for wage theft by federally regulated employers, as confirmed in the 2025 federal budget. Right to Request Flexible Work Arrangements Employees with at least 6 months of continuous service may formally request changes to their hours, schedule, or work location. Employers must respond in writing within 30 days and provide reasons for any refusal. This right is set out in sections 177.1–177.2 of the Canada Labour Code . Right to Disconnect The Budget Implementation Act, 2024, No. 1 received Royal Assent in 2024 and added right-to-disconnect provisions to the Canada Labour Code. Those provisions have been enacted, and federally regulated private-sector employers must have their written disconnect policies finalized and implemented by July 2026 per the Order in Council. Employers should prepare disconnect policies proactively, and federally regulated employers must have their written disconnect policies in place by July 2026. Updates will be posted on Non-Compete Agreement Restrictions The federal government has signalled its intention to restrict non-compete clauses for federally regulated employees. As of March 2026, formal consultations are expected but no legislation has been enacted . Bill C-27 Is Dead — PIPEDA Remains in Force Bill C-27, which contained the proposed Consumer Privacy Protection Act (CPPA) and the Artificial Intelligence and Data Act (AIDA), died on the Order Paper when Parliament was prorogued in January 2025 . It has not been reintroduced. The Personal Information Protection and Electronic Documents Act (PIPEDA) continues to govern federal private-sector privacy obligations. The Pay Equity Act and its regulations impose binding obligations on federally regulated employers. Two key milestones demand attention in 2026. Pay Equity Plans All covered employers with 10 or more employees must establish a pay equity plan within three years of becoming subject to the Act. For most employers who became covered when the Act took effect on August 31, 2021, this deadline has already passed. Employers who have recently crossed the 10-employee threshold should calculate their own compliance window carefully. First Annual Reports — Due November 1, 2026 Private-sector employers with 50 or more employees must file their first annual pay equity report with the Pay Equity Commissioner by November 1, 2026 . These reports must detail the employer's pay equity plan, any identified compensation gaps, and the steps taken to close them. The reporting obligation is ongoing and annual. Practical Steps for Employers Audit current job classes and compensation data now to identify gaps before the November deadline. Engage your pay equity committee (or establish one if required) to review and update your plan. Consult the Pay Equity Commissioner's guidance and official federal templates/FAQs for plan posting, reporting, and compliance details. Failure to comply can result in administrative monetary penalties. Employers should treat the November 2026 filing date as a firm deadline.