Let's test your vacation pay knowledge.
1. In what year were employers in Ontario first required to give employees time off with pay so they can take a vacation?
2. When this legislation was first enacted, how much paid vacation were employers required to provide?
a) 3 days
b) 1 weeks
c) 2 weeks
3. When paid vacation was first legislated, how were employees paid their vacation pay?
a) Once a year on the anniversary of their start date
b) With every pay cheque as a percentage
c) Employers had to buy vacation pay stamps that were put into a vacation pay stamp book. The employee got the cash by taking their stamp book to a chartered bank to collect their money.
4. New employees are now entitled to two weeks per year paid vacation. After five years of completed service employees are entitled to three weeks of vacation.
5. If an employer has not scheduled the two weeks of paid vacation within the 12-month period that the employee earned it, the employee has the right to schedule the vacation owing.
6. If an employee requests it in writing, their two weeks can be taken a day or two at a time to add on to long weekends, etc.?
7. The employer can choose to either pay vacation pay when the vacation is taken or, if the employee agrees, vacation pay could be paid out at the rate of 4% with every pay cheque or, if they both agree, at some mutually agreeable time.
8. Even if an employee is absent from work due to illness or some other permitted leave and not earning money for part of the year, they still earn two weeks’ vacation with pay.
9. If you earned vacation during the calendar year and you are terminated in May, you are still entitled to your two weeks’ vacation pay for that year.
1. b) 1944
2. b) 1 week
3. It’s so bizarre it must be true. The answer is c). This system was phased out in the late 1960s;
4. b) False. As of 1970, employees were entitled to two weeks of vacation per year but contrary to many misconceptions, the Employment Standards Act doesn’t require anything more than two weeks’ paid vacation no matter how long you work for an employer. Most employers increase paid vacation to reward long service but if and when they do it is totally up to them.
5. b) False. An employee must be given their time off with vacation within 10 months of the end of the 12-month period in which it was earned. If you start on September 1st but the employer has adopted a vacation entitlement year of the calendar year, you will have earned 3.3 paid days off by the new year which you can take. After that the employer could make you work the next 12 months without a vacation so long as it schedules the vacation with the first 10 months of the following calendar year.
Alternatively, the employer can simply make your first 12 months of work the vacation earning year. Most employers don’t do this because then they have to have a running calculation for everyone in the company who all have different start dates. Usually they will clean up any vacation earned as you enter into what they have adopted as their vacation earning period whether that is the calendar year or, for example, June 1st of every year to May 31st. It is simpler and gets everyone on the same system. As long as the employer follows these rules they have the absolute discretion as to when vacation is scheduled.
6. False. The employer’s obligation is to provide the vacation time in one week blocks, less if less has been actually earned. While many employers allow employees to take vacation days here and there, that is dependent on the consent of both parties and the employee must request it in writing. Employers cannot force you to take your vacation time in periods of less than one week.
7. True. Generally vacation pay is paid out when the employee takes vacation but if both parties agree it can
be paid out with every pay cheque or on a chosen date they both agree on.
8. False. They still earn the time off but they only earn 4% of their actual earnings. Conversely, if you work a lot of overtime you still earn 4% vacation pay on the overtime as well as your regular wages. That will not increase your time off beyond the two weeks but you will be owed more than two weeks’ vacation pay for that year.
9. False. Most employers allow employees to take time off during the first 12 months and don’t make them wait like they could. That means that if the employee took two weeks off in the middle of their first 12 months then quit they would have been overpaid.
If you were permitted to take your vacation during your first 12 months, as of midnight January 1st you probably had nothing in the vacation bank. If you were terminated at the end of May you earned 5/12 of your yearly vacation entitlement, not the whole thing.
P.s. As you read this I am on vacation. I am self-employed so no vacation pay for me. Not whining, just saying.
Ed Canning practices labour and employment law with Ross & McBride LLP, in Hamilton, representing both employers and employees. You can email him at email@example.com.