Can you provide me with some direction as to the calculation of statutory pay for hourly employees, especially in the retail industry?
Question: Would the results be the same using the total hours worked over the four-week period divided by 20?
Answer: Calculation of holiday pay is not straightforward in the case of hourly employees without regularly scheduled hours of work. Employees’ hours of work may vary day to day and week to week. An additional complication can arise in the retail sector with employees who are paid on a partial commission basis.
Entitlement to and calculation of holiday pay differs from province to province based on the applicable labour standards legislation. It is important to recognize that not all employees are entitled to public holiday pay and employees may be excluded because they have not worked enough hours or shifts in the weeks preceding the holiday or because of the type of job they do. Additionally, if you are a unionized employer, you will have to look to the terms of the collective agreement.
Your question seems to relate to the public holiday pay provision in Ontario’s Employment Standards Act. Employees in Ontario are entitled to public holiday pay which is calculated by taking the total amount of regular wages earned and vacation pay payable to the employee in the four work weeks before the work week in which the public holiday occurred, and dividing this by 20. Regular wages do not include any overtime, public holiday, vacation or premium pay owed to an employee. Regular wages may include commissions earned.
Your suggested calculation may not end up with the same results. If you only consider hours worked, the calculation will not reflect commissions earned or vacation pay payable.
In Nova Scotia, for example, an employee whose wages are calculated on a daily or hourly basis shall be paid at least the equivalent of the wages he would have been paid at his regular rate of wages for his normal hours of work.
Though the legislation does not provide a formula for calculating the regular rate of wages, the labour standards division advocates taking the employee’s total wages over the 30 days prior to the holiday and dividing by the total number of days worked by the employee during that 30 day period. As in Ontario, commissions are to be included in wages. However, vacation pay is not included.
Brian Johnston is a partner with Stewart McKelvey Stirling Scales in Halifax. He can be reached at (902) 420-3374 or [email protected].
Answer: Calculation of holiday pay is not straightforward in the case of hourly employees without regularly scheduled hours of work. Employees’ hours of work may vary day to day and week to week. An additional complication can arise in the retail sector with employees who are paid on a partial commission basis.
Entitlement to and calculation of holiday pay differs from province to province based on the applicable labour standards legislation. It is important to recognize that not all employees are entitled to public holiday pay and employees may be excluded because they have not worked enough hours or shifts in the weeks preceding the holiday or because of the type of job they do. Additionally, if you are a unionized employer, you will have to look to the terms of the collective agreement.
Your question seems to relate to the public holiday pay provision in Ontario’s Employment Standards Act. Employees in Ontario are entitled to public holiday pay which is calculated by taking the total amount of regular wages earned and vacation pay payable to the employee in the four work weeks before the work week in which the public holiday occurred, and dividing this by 20. Regular wages do not include any overtime, public holiday, vacation or premium pay owed to an employee. Regular wages may include commissions earned.
Your suggested calculation may not end up with the same results. If you only consider hours worked, the calculation will not reflect commissions earned or vacation pay payable.
In Nova Scotia, for example, an employee whose wages are calculated on a daily or hourly basis shall be paid at least the equivalent of the wages he would have been paid at his regular rate of wages for his normal hours of work.
Though the legislation does not provide a formula for calculating the regular rate of wages, the labour standards division advocates taking the employee’s total wages over the 30 days prior to the holiday and dividing by the total number of days worked by the employee during that 30 day period. As in Ontario, commissions are to be included in wages. However, vacation pay is not included.
Brian Johnston is a partner with Stewart McKelvey Stirling Scales in Halifax. He can be reached at (902) 420-3374 or [email protected].
