Cara Operations, the owner of such restaurants as Harvey's, Swiss Chalet, Kelsey's and East Side Mario's, will switch to cage-free eggs in its entire supply chain by 2020.
The announcement was made Thursday by the group Mercy For Animals, which said it collaborated with Cara Foods to develop the policy.
Restaurant Brands International (TSX:QSR), the parent company of Tim Hortons and Burger King, took a similar stance on Monday to serve cage-free eggs at all locations throughout North America by 2025 amid pressure from customers for ethically-sourced food.
In the last year, Starbucks, Subway, McDonald's, Wendy's and several other restaurants, retailers, food manufacturers and food-service companies have pledged to go cage-free at the urging of consumers concerned about animal welfare.
Mercy for Animals president Nathan Runkle said the decision by Cara Foods (TSX:CAO) will reduce the suffering of countless hens each year.
The group says hens used for eggs are "crammed for life into tiny wire cages on factory farms" and each bird has less floor space "than the size of a sheet of notebook paper."
Runkle said with this latest announcement, "the days are numbered for egg factory farmers who pack birds in cages so small they can't walk, spread their wings, or engage in other natural behaviours."
"Any food company that has not yet adopted a cage-free egg policy is simply out of step with consumer expectations and business trends," he said.
Egg Farmers Canada has said it will take time for farmers to undergo a transition to cage-free production facilities.
More than 90 per cent of the country's roughly 1,000 registered commercial egg-producing farms keep their hens in conventional housing, said Peter Clarke, the chairman of Egg Farmers Canada.
"It isn't just like turning a light switch on and off," he said earlier this week. "It takes a significant amount of time to be able to do that."