Canada: Tis' The Overtime Season. Or Is It?

The holiday season can be a period of recovery and relaxation for some businesses, while it might be the busiest time of the year for others. For the latter group, employers need to be aware of their obligations to pay some of their employees Overtime pay, where applicable.

Under Ontario legislation, employers are obligated to pay some of their employees Overtime pay when those employees work more than 44 hours in a week.

Overtime pay, also known as "time and half pay", is calculated at 1 ½ times an employee's regular rate of pay, for those hours exceeding 44 hours in a given week.

In other words, where an employee makes 20$/hour as regular wages, they would be entitled to 30$/hour for every hour worked in excess of 44 hours in a given week.

Whereas this calculation seems quite straightforward, employers must also consider a few other variables when it comes to Overtime pay.

First, certain classes of workers, such as managers, supervisors, and regulated professionals (like lawyers), are exempt from the Overtime pay requirements under Ontario legislation. The 44 hours rule does not apply to employees in those job classifications and those employees are not entitled to Overtime pay.

Second, certain classes of workers, such as highway transport tuck drivers, are subject to a higher weekly hours threshold (i.e.: 60 hours rather than 44 hours) before triggering any entitlement to Overtime pay.

Third, some employees have "multi-purpose" jobs, where they may be required to do some work that falls into an exempt category (i.e.: some supervisory functions), while also being required to do work that does not fall into an exempt category. For those employees, the "50 per cent rule" applies.

The "50 per cent rule" provides that if at least 50% of an employee's work is in a job that is covered under the Overtime pay provisions of Ontario legislation, the employee qualifies for Overtime pay.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.