Ways to Improve Employee Motivation for Small Businesses Without Spending Money

Vacation pay is three weeks for employees who have worked for the same employer for five years.

In Ontario, there are certain employment guidelines regarding vacation leave that entitle employees to paid time off. Although there are some job categories that are exempt, most employers must comply with the Labor Standards Act (ESA) when it comes to providing paid time off.

It is important to note that vacation pay and time off are different from vacation pay and fees.

As of January 1, 2018, vacation time and pay place employees in two groups based on the number of years an employee has worked with the same employer. Here are the key differences in minimum vacation time and pay:

  1. Employees who have worked less than five years earn two weeks of vacation after each 12-month vacation entitlement year, calculated by four percent of your gross pay (excluding any vacation pay) earned in the 12-month vacation entitlement year or stub period ( if appropriate).
  2. Employees who have worked five years or more earn three weeks of vacation, calculated at six percent of your gross earned wages in the 12-month entitlement year or stub period (if applicable).

As an employer, you can provide more rights and benefits to your employees in addition to the minimum standards set by the ESA. However, it cannot be less than the amounts indicated above.

Ten Facts About Vacation Pay For Ontario Entrepreneurs

Here are ten things to keep in mind, in addition to the minimum standards for vacation leave:

  1. A year of vacation entitlement is a 12-month recurring period that can be counted from the employee’s hire date or, alternatively, throughout the calendar year. If the latter, you must allocate a prorated sum of vacation time for the duration between your employee’s start dates and your calendar year; This is called a “hold period.”
  2. You do not need to provide vacation time if an employee does not complete a full year of vacation entitlement or a stub period. However, employees earn vacation pay as they earn their salary.
  3. Vacation time is accrued during leave, such as parental or maternity leave, as there is no break in the employment relationship.
  4. Your employees must take vacation within ten months after completing one year of vacation entitlement or vesting period.
  5. As an employer, you also have the right to schedule vacations and ensure that your employees take time off before the end of that ten-month period.
  6. Employers must schedule their vacation time in blocks: blocks of two or three weeks, or one-week blocks of two or three, depending on the years of service. For shorter rest periods (i.e. one day), your employee can request it and the agreement can be made in writing or electronically.
  7. In most cases, paid vacation earned must be awarded in a lump sum before your employee takes the vacation. However, there are several exceptions to this.
  8. Your employee may not use all or part of his vacation time; however, as an employer, you are still obligated to provide them with your earned vacation pay. In this case, you will need written or electronic consent along with approval from the Director of Labor Standards.
  9. In layoff cases, you must provide your employee with earned vacation pay. This is required within seven days of termination or the next payday.
  10. If your employee requests a record of your vacation pay (in writing), you must provide the statement within a week of the request or before the next payday.

If you’re still wondering how to calculate vacation pay, or have questions like what to do with vacations for seasonal employees, it’s always a good idea to get help from an HR expert.

Website design By BotEap.com

Add a Comment

Your email address will not be published. Required fields are marked *