Humaniqa HR Blog
Overtime Rules Across the Country July 02 2015
Each province and territory has its own rules and regulations surrounding overtime. We have provided a breakdown of those rules and regulations according to each jurisdiction.
This article also serves as an important reminder to keep your overtime practices and procedures up to date. A clear policy and advance authorization of overtime usually helps to ensure proper management control of this major expense.
Furthermore, an overtime policy is essential to clearly outline when and how overtime will be allowed, documented and compensated. This will eliminate discrepancies when employees claim for overtime not earned and to ensure it is reasonable.
Both employers and employees should ensure they are aware of their overtime rights and obligations.
Visit the Resources Center of our website to find sample policies and forms relating to overtime by provincial jurisdiction. As with all samples you will find in this section, you will want to revise it in order to suit your specific circumstances.
AlbertaAn employee is entitled to overtime pay if their hours of work exceed eight (8) hours in a single work day, or forty-four (44) hours in a work week, whichever is greater. Overtime pay must be at least a rate of time-and-a-half. Where an agreement is made in writing, the employee can opt to take time off in lieu of overtime pay. The overtime agreement must contain the following minimum provisions:
- Time off with pay instead of overtime pay must be taken and paid at a time when an employee would have been regularly scheduled to work non-overtime hours;
- If time off in lieu of overtime pay is not taken and paid to the employee, then overtime pay at a rate of time-and-a-half must be provided for the overtime hours worked instead;
- Time off with regular pay in-lieu must be taken and paid within three months of the end of the pay period in which it was earned;
- This rule does not apply in cases where a collective agreement allows for a longer period of time; or
- The Director of Employment Standards issues a permit to extend the period.
- The overtime agreement cannot be amended or terminated without at least one month’s written notice from one party to the agreement of the other.
When either the employer or employee ends the employment relationship by giving a written notice of termination, the employer can require the employee to use up some or all outstanding banked overtime during the notice period.
Whether or not any notice of termination was provided, any banked overtime not provided and taken with pay by the end of the last day of employment must be paid out at a rate of time-and-a-half the employee’s regular rate of pay at the time it was earned.
British ColumbiaAn employee qualifies for overtime pay when they work more than eight (8) hours a day, or more than forty (40) hours in a week. The overtime rate for employees’ who work more than eight (8) hours a day, but less than twelve (12) hours, is time-and-a-half. If an employee works more than twelve (12) hours a day, the rate is double the employee’s regular wage. If an employee exceeds forty (40) hours in a week, the employee must be paid at a rate of one-and-a-half times their regular wage rate.
If an employee is working under an averaging agreement, this means that the employee and the employer have agreed to average an employee’s hours over one, two, three or four weeks. Employees may agree to work up to twelve (12) hours in a day, averaging forty (40) hours a week, without being paid overtime. However, there are certain rules that the Employment Standards Act outlines for such agreements. The agreement must:
- Be in writing;
- Specify the number of weeks over which the hours will be averaged (one to four weeks);
- Specify the number of times the agreement may be repeated;
- Specify a start and end date for the agreement; and
- Be signed by the employer and the employee prior to taking effect.
Employers and employees also have the option to bank overtime hours. This means that an employee may request in writing, to have the employer start a “time bank”. The overtime hours would be added to that bank, rather than be paid out during the pay period in which they were earned. At any time, an employee may request that the employer pay out all or part of the wages credited to the bank. The employee may also request time off with pay for some mutually agreed period, or request in writing that the bank be closed. Upon receiving an employee’s request to close the bank, the employer must pay the outstanding balance to the employee.
The employer may close an employee’s time bank, but only after giving the employee one (1) month’s written notice. When an employer closes an employee’s time bank, the employer must, within six (6) months, either:
- Pay the employee all of the overtime wages credited to the time bank;
- Allow the employee to use the credited overtime wages to take time off with pay; or
- Pay the employee for part of the wages credited to the time bank and allow the employee to use the remainder of the credited overtime wages to take time off with pay.
Overtime must be used or paid out at the rate it was earned. On termination of employment or on receiving the employee’s written request to close the time bank, the employer must pay the employee any amount credited to the time bank.
Overtime is due for any work exceeding eight (8) hours in a day, or forty (40) hours in a week. If the total daily overtime hours differ than the total weekly overtime hours, the greater of the two will be used in calculating overtime payment. The overtime rate for federal employees is one-and-a-half times their regular wage rate. The maximum hours that most employees may work are forty-eight (48) hours per week. Maximum hours may be exceeded:
- With the permission of the Minister of Labour;
- If there is an emergency, such as an accident or essential work needs to be done on a piece of equipment; or
- If there is an averaging agreement in place.
If the employee works a compressed work week (e.g. ten hour shifts, four days a week), daily overtime would be calculated when an employee works in excess of ten (10) hours in one (1) day.
If an employee and employer agree in writing, an employee’s hours may be averaged over a period of two (2) or more weeks. In the averaging agreement, overtime would apply after the employee exceeds the standard hours in an averaging period. The standard hours are calculated by multiplying the number of weeks in the averaging period by forty (40).
ManitobaEmployees are entitled to overtime if their hours exceed eight (8) hours in a day, or forty (40) hours in a week. The overtime rate is one-and-a-half times their regular wage rate. Employees are not permitted to work overtime unless they have been given permission to do so by their employer. Likewise, employees’ must agree to work overtime before it can be scheduled.
If agreed to in writing, overtime hours can be banked. The parties can make their own rules as to how the time will be provided or paid out, as long as the following minimum requirements are met:
- For each hour of overtime worked, employees receive one-and-a-half hours off at their regular rate;
- Time off must be scheduled during hours when non-overtime would normally be worked;
- The time off must be provided to the employee within three (3) months of when it was earned, unless Director of Employment Standards authorizes a longer period.
The employer is required to pay out any remaining banked time if the employment relationship ends.
According to the New Brunswick Employment Standards Act, employers must pay overtime to employees who work more than forty-four (44) hours in a week. As of December 31, 2014, the minimum overtime wage rate is $15.45 per hour. Employers must pay their employees at least one-and-a-half times the minimum wage for each hour they work in excess of forty-four (44) hours during a work week.
Newfoundland and LabradorAny hours worked in excess of forty (40) hours in a week are to be compensated at a rate of one-and-a-half times the employee’s regular wage rate. Employees also have the option to bank overtime hours. An employee can receive one-and-a-half hours of paid time off work for each hour of overtime worked in lieu of overtime pay. However, the following conditions apply:
- The time off shall be taken within three (3) months of the date earned, unless the employer and employee agree to extend the time period; and
- Payment or time off must be finalized within twelve (12) months of the date the overtime is earned.
If the employment relationship ends before banked time is used, the employer shall pay the employee the remaining overtime pay within seven (7) days of termination.
Northwest TerritoriesThe standard hours of work are eight (8) hours a day, or forty (40) hours a week. Any time worked that exceeds the standards hours of work for a day or a week must be compensated at a rate of one-and-a-half times the regular wage rate. Employers are not permitted to schedule an employee’s hours to exceed ten (10) hours in a day, or sixty (60) hours in a week.
With the permission of the Employment Standards Officer, an employer and employee of an industrial establishment may agree to average out an employee’s hours over a period of one (1) or more weeks if the nature of the work necessitates irregular distribution of an employee’s hours of work. The Employment Standards Officer may authorize the hours of work in a day to exceed the standard hours of work by requiring the days of work in a week to be reduced.
Employees and employers may also have an overtime agreement in place which allows the employee to take time off with pay in-lieu of overtime pay. An overtime agreement must include at least the following provisions:
- Each hour of overtime entitles the employee to one-and-a-half hours of time off with pay instead of overtime pay;
- Time off with pay will be provided and taken at the employee’s regular wage rate;
- Time off with pay will be provided and taken at a time when the employee could have worked and received wages from the employer;
- If time off with pay is not provided or taken, the employer shall pay the employee overtime pay;
- Time off with pay will be provided and taken within three (3) months after the end of the pay period in which it was earned, unless
- The agreement is part of a collective agreement and the collective agreement provides for a longer period within which the time off with pay is to be provided and taken; or
- The Employment Standards Officer makes an order authorizing a longer period within which the time off with pay is to be provided and taken;
- No amendment or termination of the overtime agreement is to be effective without at least one (1) month’s written notice given by one party to the other.
The general rule for overtime is that employees must receive at last one-and-a-half times their regular wages for each hour worked in excess of forty-eight (48) hours in a week. Some groups of employees have special rules to deal with overtime called wage orders. The jobs covered by these wage orders are, Minimum Wage (General) and Minimum Wage (Construction and Property Maintenance).
Employees and employers can have averaging agreements in place in which both parties agree to have the hours of work averaged over a number of weeks.
NunavutThe standard hours of work for an employee are eight (8) hours in a day or forty (40) hours in a week. An employer may require or permit an employee to work more than the standard hours of work provided that the total hours of work for an employee do not exceed ten (10) hours in a day and sixty (60) hours in a week.When an employee is required/permitted to work in excess of the standard hours of work, the employer must pay at a rate of wages no less than one-and-a-half times the employee’s regular rate.
The Labour Standards Officer may authorize hours to be worked by any class of employees in an industrial establishment in excess of the maximum hours of work where:
- The nature of the work in an industrial establishment is seasonal or intermittent in nature; or
- There are exceptional circumstances to justify the working of additional hours.
A permit issued under the increasing maximum hours may:
- Specify the total number of additional hours in excess of the maximum hours; or
- Specify the additional hours that may be worked in any day and in any week during the period of the permit.
With the permission of the Labour Standards Officer, an employee and employer may agree to average hours of work over a period of one (1) or more weeks, where the nature of the work in an industrial establishment necessitates irregular distribution of an employee’s hours of work. The Labour Standards Officer may:
- Reduce the days of work in a week by permitting hours of work in a day in excess of the standard hours of work, in respect to those employees; and
- Specify the conditions under which the permit applies.
OntarioIn Ontario, overtime pay is one-and-a-half times the employee's regular rate of pay. Overtime pay would begin when an employee exceeds forty-four (44) hours in a week. Overtime is calculated only:
- On a weekly basis; or
- Over a longer period under an averaging agreement
Many employees have jobs that are exempt from the overtime provisions within the Employment Standards Act (ESA).
Employees can agree in writing to bank overtime hours and take time off in lieu of overtime pay. If an employee has agreed to bank overtime hours, they must be given one-and-a-half hours of paid time off work for each hour of overtime worked. Paid time off must be taken within three (3) months of the week in which the overtime was earned or, if the employee agrees in writing, within twelve (12) months. An employer and an employee can also agree to average the employee’s hours of work over a specified period of two (2) weeks or more for the purposes of calculating overtime pay. Under such an agreement, an employee would only qualify for overtime pay if the average hours worked per week during the averaging period exceed forty-four (44) hours.
If an employee’s job ends before they have taken the paid time off, the employee must receive the overtime pay. This must be paid no later than seven (7) days after the date the employment ended or on what would have been the employee’s next pay day.
Prince Edward Island
The standard work week is forty-eight (48) hours. Any time worked beyond that is subject to overtime at a rate of one-and-a-half times the employee’s regular rate. Employees also have the option to accumulate their overtime hours and use them as paid time off. Time taken off in lieu of overtime pay can be taken only if the employee requests it in writing and the time must be taken within three (3) months of the time it was earned.
An employee who accumulates overtime hours must be compensated at the rate of one-and-a-half hours of paid time off at the employee’s regular rate of pay for every one hour of accumulated overtime. If there are still banked overtime hours when the employment relationship ends, the remaining hours must be paid out to the employee at the time-and-a-half rate.
QuebecA standard work week in Quebec is forty (40) hours. Anytime worked above that is paid at a rate of one-and-a-half times the employee’s regular rate. The employer may, at the request of the employee or as provided for in the collective agreement, allow the employee to receive paid time off work instead of overtime pay.
If the employer agrees to bank the overtime hours, the time off must be given at one-and-a-half hours of paid time off work for each hour of overtime worked. The banked time off must be taken within twelve (12) months of the time it was earned, or paid out to the employee. If the employment relationship ends before the banked time is used, the remaining balance must be paid at a rate of time-and-a-half at the same time as the last payment of wages.
SaskatchewanA standard work week in Saskatchewan is forty (40) hours. Most employees who work for more than eight (8) hours per day are entitled to overtime pay at a rate of one-and-a-half times the employee’s hourly wage rate. They are also entitled to overtime for any hours worked in excess of forty (40) hours per week. Employees are able to bank their overtime hours and take time off rather than receive overtime pay.
The Averaging of Hours Permit facilitates an averaging of the hours of work for employees who want to work longer shifts but over fewer days or weeks. Overtime must still be paid if the hours worked by the affected employees exceed the hours stated in the permit. These permits do not apply to unionized workplaces. Unionized work workplaces must obtain the written agreement from their trade union.
YukonThe standard hours of work in the Yukon are eight (8) hours in a day and forty (40) hours in a week. Overtime is any hours worked in excess of eight (8) hours in a day and forty (40) hours in a week. The overtime rate is one-and-a-half times the employee’s regular rate of pay.
Employees are able to take paid time off instead of receiving overtime pay under two conditions: 1) there is an agreement in writing between the employee and the employer, or 2) it is part of a collective agreement. Time off is calculated by multiplying the hours of overtime worked by the employee by one-and-a-half times. Any earned and unused overtime must be paid out within a twelve (12) month period stated in the agreement or, if no date is specified, within a calendar year. A short work week may be implemented when there is a written agreement between the employer, employee and/or a majority of the employees, or the employees' bargaining agent.
Employers can apply to the Director to issue a permit to average the hours of work. Permits may be granted when:
- The nature of the work justifies the irregular distribution of the hours of work;
- The employer and the trade union representing employees agree to an averaging arrangement; or
- The employer and a majority of employees at a non-union worksite agree in writing to averaging.
An averaging permit allows hours of work to be averaged over a period of two (2) or more weeks, so that overtime becomes payable after eighty (80) hours worked in a two (2) week period.