Get Ready for Summer with this Vacation Time and Pay Breakdown

Get Ready for Summer with this Vacation Time and Pay Breakdown

Get Ready for Summer with this Vacation Time and Pay Breakdown

As the summer looms ever nearer and all of Canada’s National Parks are on offer for free to mark our country’s 150th anniversary, you are probably hoping to cash in some of those vacation days to maximize your time away from the over- or under-air-conditioned office.

When it comes to vacations, Canadians can’t get enough. And we don’t. In fact, we rank pretty low in the developed world for paid vacation days. We’ll save you the trauma of knowing how much paid downtime those Scandinavians get and instead give you an overview of your entitlements under Ontario Labour Law to make sure you can take advantage of them in full during the warm weather months ahead.

Vacation Time

Ontario employees are entitled to two weeks’ vacation time after each 12-month vacation entitlement year. Your vacation entitlement year normally begins the day you are hired. This means that after 12 consecutive months of employment with the same company you are entitled to two weeks of vacation. The vacation entitlement year is not affected by approved leaves of absence or sick days. This means, for example, that if your entitlement year began in May, 2016 and you took three months parental leave from July to September, you are still entitled to take two weeks off as of May, 2017.

Vacation Time Ontario - Calculating Vacation Pay

Unfortunately, the Employment Standards Act doesn’t provide for increases to the vacation time entitlement based on length of employment. This means that, in Ontario, even after working for the same employer for five, ten, or even 25 years, you are still only entitled to two weeks vacation time. However, many contracts and collective agreements do provide for increases to vacation time as the length of your employment increases.

Calculating Vacation Time

The number of vacation days to which you are entitled depends on whether your employment is full- or part-time. Generally speaking, you are entitled to take off the number of days you work in a regular work week, times two.

Therefore, if you work five days a week you get ten vacation days (two work weeks). If you work three days per week you get six vacation days. If you have an irregular schedule with varying numbers of days worked in a week throughout the year, you can calculate your vacation days by taking the number of days you worked in the last entitlement year period and dividing it by 52 (the number of weeks in the year) to get the average number of days you worked per week and then multiplying that number by two. For example, if you worked 136 days last year you would be entitled to 5.2 vacation days (136 days ÷ 52 weeks x 2 = 5.2 days).

Scheduling Vacation Time

Vacation time must be taken within ten months of the completion of the entitlement year. Employers have the right to schedule vacation and are obligated to ensure it is taken before the end of the ten-month period following the completion of an employee’s entitlement year period.

If an employee is on leave at the time of this deadline, the vacation time must be taken when the leave ends or at a later date agreed upon in writing by the employer and employee.

Additionally, vacation time must be scheduled in one or two week blocks unless the employer and employee give written agreement to an alternate arrangement. This means that extending long weekends with an extra vacation day here and there is at the discretion of employers and not guaranteed for employees wishing to make a four-day cottage trip out of the upcoming Victoria Day Weekend.

How to Caculate Vacation Pay Ontario - KCY at LAW

How To Calculate Vacation Pay

Vacation pay also begins accruing the day you are hired. It must be at least 4% of your gross wages for your entitlement year. Whereas with vacation time, you must complete your full vacation entitlement year to receive any vacation time, you earn vacation pay while you earn wages. So, if you work 3 months, you will be entitled to a minimum of 4% of those months’ wages as vacation pay. Accordingly, if you earned $30,000 in gross wages in your vacation entitlement year, you are entitled to $1,200 ($30,000 x 0.04) as vacation pay.

Gross wages include your: normal earnings, commissions, non-discretionary bonuses, overtime, public holiday pay and termination pay. On the other hand, earnings from tips, gratuities, discretionary bonuses (Christmas or others unrelated to performance), travel expenses and allowances, benefit plan contributions, federal EI benefits, and severance pay are not included in your gross wages when calculating vacation pay.

Vacation pay is generally paid in a lump sum before an employee takes their earned vacation time. If you quit or are dismissed, you are entitled to be paid the vacation pay that you have earned but not yet been paid out.

Vacation Time or Pay Compensation

If you have been denied vacation time or pay, KCY at LAW are experienced employment law lawyers who can help get you compensation for those lost beach hours. Fill out our contact form or call us to book your consultation (905) 639-0999.