A forced break from work

As we approach another year-end and holiday season, the minds employees of many turn to vacation time. For a lot of workers, with three statutory holidays in a period of eight days, it means using a bit of vacation time to get a good stretch of time off work.

Similarly, some companies decide to simply close their operations for a period of time in the last week or two of the year.

In principle, this can seem like a good thing for workers who know they will have time off to enjoy the season and spend time with their families. However, it can mean a lower paycheque if the time during office closure is unpaid or if there’s a lack of choice for when they can take their vacation leave.

Employment standards legislation usually doesn’t require employers to pay employees during a scheduled closure. After all, the fundamental principle of the employment relationship is that employees perform work for the employer in exchange for compensation. If employees aren’t performing work, the employer doesn’t have to pay them.

There could be a concern of whether unpaid leave during a shutdown could be considered a temporary layoff. Employment standards legislation generally permits such layoffs, but courts have disagreed, finding temporary layoffs are usually only permitted if the employment contract expressly allows them or it’s normal practice for the employer or industry. For businesses that close the office at certain times of the year, the latter could be enough justification.

Workers may have an option to use their vacation entitlement during the closure, though they would have to have enough vacation time remaining to cover the shutdown period. In many cases of a shutdown, employers require employees to use vacation days during this period. The latter situation can happen at any time of the year, depending on the business and the industry — companies could choose to shut down for a couple of weeks in the summer or seasonal businesses could close during slow times.

This is where it’s important to remember that employment standards legislation also entitles employers to dictate when employees can take their vacation. Legislative vacation requirements only refer to the amount of vacation time to which employees are entitled each year, not when they can take it — something that comes in useful for employers during office closures, either during the holiday season or other slow times of the year when it makes sense for a business to reduce costs by shutting down.

However, there are some standards employers must follow if they control when employees can take their vacation leave. The vacation time can’t be dished out bit by bit, rather it generally has to be provided at least in one-week segments so employees can truly benefit from the time off. And there are deadlines for when vacation leave must be used — usually about 10 to 12 months after the year in which the vacation was earned, depending on the jurisdiction.

So, while employers are entitled to dictate when employees can take vacation, they must do so reasonably — forcing vacation for an office closure would have to be for at least a week, not a single day.

It’s perfectly legal for employers to require employees to take their vacation leave at specific times according to the employer’s business needs, such as closing the office temporarily. And while some employees may not like being told when they can take time off, many would probably prefer that than not getting paid at all during the closure.