THE EMPLOYERS' EDGE
Streamlining Labour: Ontario’s Legislative Shift on Labour Mobility
Recent reports prepared by the Macdonald-Laurier Institute have shown that internal trade barriers have had a devastating impact in Canada, the barriers translating to a virtually 7% tariff. In an integrated Canada, ensuring skilled experts can move across provinces and territories freely is not only an economic necessity but a constitutional requirement. The Ontario Free Trade and Mobility Act, 2025, enacted through the Protect Ontario Through Free Trade Within Canada Act, 2025, S.O. 2025, c. 3 - Bill 2, builds on this principle by abolishing internal obstacles to labour mobility, in addition to treating trade in goods, services, and investment among jurisdictions. For employment lawyers advising clients on employment, regulatory matters, or inter-provincial business, familiarity with this legislation is crucial.
Purpose and Framework
The Act aims to eliminate unnecessary barriers to the mobility of labour by establishing a legislative framework that promotes mutual recognition of qualifications between Ontario and the rest of Canada. In this scheme, if an individual is accepted in a "reciprocating jurisdiction" to provide a regulated service, then Ontario must accept the authorization as long as certain conditions are met.
The Act creates terminology that structures its application. For instance, an "authorizing body" forms governmental and delegated non-governmental organizations such as regulatory colleges or professional boards of licensing. A "reciprocating jurisdiction" refers to any Canadian jurisdiction that the regulation prescribes to have law that is substantially similar to this Act.
Mutual Recognition: Simplifying Professional Mobility
Section 4 of the Act authorizes the Lieutenant Governor in Council to declare a further province, territory, or federal government a "reciprocating jurisdiction" by regulation, when such a jurisdiction has passed reciprocal legislation or de facto adopted reciprocal measures.
Once designated, the Act mandates mutual recognition in two key aspects:
Goods: Legally approved goods in a reciprocating province should be deemed compliant in Ontario regarding composition, performance, manufacture, advertisement, packaging, testing, and related standards. No additional approval or testing needs to be done in Ontario.
Services and Labour Mobility: Those who are so allowed to perform a service in a reciprocating jurisdiction are entitled to similar permission in Ontario, so long as they are in good standing and comply with any regulatory or prescribed conditions (those of the Ontario Labour Mobility Act, 2009 in particular, or the Regulated Health Professions Act, 1991).
The most significant provision, perhaps, is Section 4(2), the mutual recognition rules. These ensure that an individual or organization already approved in a reciprocating province can secure an Ontario equivalent approval without going through duplicative time-consuming applications and expenditures. This is a giant step toward harmonization of provincial regulatory standards.
Implications for Legal Practitioners
Regulatory lawyers advising regulated-industry clients such as healthcare, engineering, or finance clients will need to be aware of the earthy use of rules of mutual recognition. Primarily to look for:
- Verifying whether the originating jurisdiction is "reciprocating" under regulation;
- Verifying whether the client's out-of-province credentials are equivalent and valid;
- Verifying whether there are other Ontario-specific requirements that must come into force before authorization can be issued.
Final Thoughts
This Act is a clear legislative indicator that Ontario is dedicated to furthering efficient labour mobility in Canada. For employers, professionals, and regulators, it offers a more efficient path toward integration of interprovincial workforce.
The lawyers at CCPartners will continue to monitor upcoming regulations, which will specify operation details, exemptions, and transitional provisions. In a post-pandemic world where remote work and cross-border professional services become increasingly common, this act is timely and necessary.
Click HERE to access CCPartners’ “Lawyers for Employers” podcasts on important workplace issues and developments in labour and employment law.