‘Tis the season to think about vacation pay…

Posted:  Jan 22, 2018

‘Tis the season to think about vacation pay…

 With the vacation season upon us, it is important to ensure that you are tracking employees’ time off properly and paying the correct vacation pay. It is imperative that both employers and employees understand the organization’s policy with respect to vacation pay. This practice will ensure employers do not end up having to pay out large sums once the employee no longer works for the company like the following employer did:

A federal employer, Fireweed Helicopters, operating a flying business was sued by its employee for unpaid vacation pay. The employee filed a claim against the employer for unpaid vacation pay from February 2008 until September 2013. The adjudicator ordered Fireweed Helicopters to pay $27,463 in unpaid vacation pay to the employee. The employer’s appeal was dismissed because there was no written contract, the oral agreement was unclear and neither employer nor employee kept good track of days worked versus days off. The employee was awarded $27,463 in unpaid vacation pay.

It is the employers right to determine when the employee will take their vacation; however, the employer must ensure that the employee either takes the time or is paid out within 10 months the vacation leave was accrued. The employer should ensure to get it in writing that the employee agrees to waive their vacation and be paid in lieu of time off in order to protect the organization.

In cases where the employer has chosen the timing of the vacation, the employer must give at least two weeks’ notice of when the employee's annual vacation is to begin.

If you have any more vacation pay questions we will be pleased to answer them. 

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