New Rules for Employers for Public Holidays

Among the changes to Ontario employment law, adopted in November, 2017, are changes to how public holiday entitlements are calculated. This has significant implications for businesses, especially those with part-time or casual workers.

Employment Agreements and Employment Policies should both be reviewed to ensure compliance - book a consultation with Momentum to discuss your current practice and update your documents as necessary.

Public Holidays raise two considerations for employees: the payment of public holiday pay for “qualifying employees” and the payment of premium pay, if an employee works on the public holiday. Below is a summary of the current rules regarding Public Holiday pay and premium pay.

Qualifying Public Holidays:

Ontario has nine public holidays:

  1. New Year's Day
  2. Family Day
  3. Good Friday
  4. Victoria Day
  5. Canada Day
  6. Labour Day
  7. Thanksgiving Day
  8. Christmas Day
  9. Boxing Day (December 26)

It is important to remember that, in Ontario, while some employers give employees a holiday on Easter Sunday, Easter Monday, the first Monday in August, or Remembrance Day, the employer is not required to do so under the Employment Standards Act. Employers should review all employment contracts and policies to determine what public holidays have been provided for in contract and ensure that it reflects the employer’s current intentions.

Qualifying for Public Holiday Pay

In Ontario, the “Last and First” rule applies to qualification for public holiday pay. Employees must (without reasonable cause), work both their last regularly scheduled shift before the public holiday and the first regularly scheduled shift after the public holiday in order to qualify for Public Holiday Pay.

Qualified employees can be full time, part time, permanent or on term contract. It does not matter how recently they were hired, or how many days they worked before the public holiday.

Calculating Public Holiday Pay

Once an employee qualifies, the way that Public Holiday Pay is calculated has been significantly changed. Under the new rules, the wages earned in the pay period preceding the public holiday are divided by the actual number of days worked, with the average day worked then becoming the Public Holiday Pay entitlement. Under this calculation, an employee who works a single, 8-hour shift in the pay period preceding a public holiday will be entitled to be paid for an 8 hour shift for that public holiday.

Where an employee is not regularly scheduled to work on the day which is the public holiday, the employer must supply an alternate paid day off. The employee and employer can still both elect to forgo the additional paid day off and simply apply Public Holiday Pay to the public holiday, but that decision must be mutual.

Working on a Public Holiday:

Premium pay is 1.5 times an employee's regular rate of pay. If an employee is entitled to receive premium pay for work on a public holiday, they must be paid 1.5 times their regular rate of pay for each hour worked. This “Premium Pay” is in addition to Public Holiday Pay, if the employee qualifies for Public Holiday Pay.

It should be noted that there are special rules for some industries and special rules for when an employee has used a leave in the relevant time period. There are also special rules for when an employee does not meet certain qualifications. Employers should consult an HR professional or legal team to review any special circumstance.

How Momentum Can Help: Schedule a consultation with Momentum to review your employment contracts and policies to see what changes need to be made to ensure compliance with the new rules.

Disclaimer:

The material and information in this article are for general information only. They should not be relied on as legal advice or opinion. The authors make no claims, promises, or guarantees about the accuracy, completeness, or adequacy of any information referred to in this article or its links, or the application of the information to your situation. No person should act or refrain from acting in reliance on any information found in this article. Readers should obtain appropriate professional advice from a lawyer duly licensed in the relevant jurisdiction. These materials do not create a lawyer-client relationship between you and any of the authors or Momentum Business Law.