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Vacation Rules: How well do you understand them?

Updated: Jun 1, 2022

How well do you understand vacation rules in your jurisdiction? Helpful tips for employers looking to improve the employee experience and time off management.

Who's Misunderstood?

There may be misunderstandings about vacation legislation in Canada. Employees and employers both have access to online employment standards and guidelines; however, their interpretation may be different.

Test your knowledge below to clarify your understanding of legislated vacation entitlements.

Here are 3 facts:

· Vacation Pay and Vacation Time are not the same.

Employers owe both Vacation Pay and Vacation Time to employees, but the two don’t have to coincide. Employers may choose to pay out entitled Vacation Pay on each paycheque. This means that when employees take their Vacation Time, the time away from work would be unpaid. Vacation Pay is earned and owed on the first dollar of wages; also, Vacation Time is earned from the first hour worked. However, when it may be taken varies by jurisdiction and often it isn’t an entitlement until after the first year the employee has worked.

· Employers can schedule an employee’s vacation time based on operational needs.

Employers don’t have to wait for employees to make the request. A best practice would be to ask employees in advance to schedule their desired time off. If employers have blackout periods, maintenance or holiday shutdowns, or if employees don’t actively request for time off, employers can schedule the vacation on an employee’s behalf. Note of caution: don’t ‘force it’ unnecessarily. Instead, encourage employees to schedule their vacation in advance and then negotiate timing with them if there are conflicts.

· Vacation Time continues to be earned during leaves of absence.

If an employee is on a job-protected leave, like a Parental Leave, the employee continues to earn vacation time. If an employee is entitled to three (3) weeks of vacation time after working for one (1) year, the amount of vacation pay is based on 6% of the wages paid during that year. Therefore, if an employee is on an unpaid Parental Leave for one (1) year, the employee is entitled to three (3) weeks of vacation time based on 6% of the wages paid during that Parental Leave following their return to work. Since the absence was unpaid, that would be 6% of $0. Therefore, no payment is owed, just vacation time.

Stay up to date on frequent changes and check your jurisdiction’s guidelines website regularly. For unionized environments, look first to the collective agreement. If not unionized, most small businesses fall under provincial legislation. Federally-regulated employers usually operate beyond provincial boundaries –like banks, transportation, First Nations band councils, radio and TV broadcasting, telecommunications, and municipalities in the northern territories (rough guideline). For those jurisdictions, check Part III of the Canada Labour Code.

Ministries often do well with making laws understandable in FAQ pages. Here’s a summary of the official sources of minimum vacation entitlement guidelines per jurisdiction in Canada:

Canada, Alberta, British Columbia, Manitoba, New Brunswick, Newfoundland & Labrador,Northwest Territories, Nova Scotia, Nunavut, Ontario, Prince Edward Island, Quebec (EN, FR), Saskatchewan, Yukon. For unionized organizations, check your Collective Bargaining Agreement.

Your HR business partner, or services like our 4-Hour Monthly HR Advice Package, can help you navigate the regulations that apply to your unique organization and jurisdiction.

For professional HR advice that you can trust, contact us today!

Lisa Isaac HR Professional Services

From the LIHR team and lead collaborator, Daniel Di Luigi, HR Consultant

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