Statutory Holidays Payroll Best Practice Guidelinestm
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CPA Guidelines IT PAYS TO KNOW Statutory Holidays Payroll Best Practice GuidelinesTM payroll.ca The Canadian Payroll Association’s mission statement is Payroll Compliance through Advocacy and Education. The Association is committed to providing the payroll-related services payroll professionals and their employers need to ensure compliance with over 190 legislative requirements that impact payroll. All references to legislative requirements are current at the time of publication; however government legislation shall prevail if there are any discrepancies between the guidelines and government statutes or regulations. These guidelines are the property of the Canadian Payroll Association/L’Association canadienne de la paie. No portion may be reproduced without the explicit written consent of the Canadian Payroll Association. Requests to reproduce the material must be made in writing to: Communications & Marketing The Canadian Payroll Association 1600—250 Bloor Street East Toronto, ON M4W 1E6 Tel: 416-487-3380, ext. 111 Fax: 416-487-3384 Canadian Payroll Association updated: 2019-01 Statutory Holidays Payroll Best Practice GuidelinesTM TABLE OF CONTENTS INTRODUCTION ........................................................1 KEYWORD SEARCH AND HYPERLINKS ...........................................1 STATUTORY HOLIDAYS PAYROLL BEST PRACTICE GUIDELINES ................2 TOP AUDIT REVIEW ...........................................................2 TERMINOLOGY ...............................................................2 LIST OF HOLIDAYS BY JURISDICTION ............................................4 HOLIDAY SUBSTITUTIONS ...................................................5 RETAIL BUSINESS CLOSURES ................................................7 ELIGIBILITY CRITERIA .........................................................7 CONSTRUCTION EMPLOYEES ................................................9 OTHER EXEMPTIONS OR SPECIAL ARRANGEMENTS ............................10 CALCULATION OF STATUTORY HOLIDAY PAY .....................................10 PAYMENT FOR ELIGIBLE EMPLOYEES ........................................11 PAYMENT FOR NON-ELIGIBLE EMPLOYEES ....................................14 EARNINGS SUBJECT TO THE CALCULATION OF STATUTORY HOLIDAY PAY. 15 STATUTORY HOLIDAY PAY ENTITLEMENT AT A GLANCE. .16 COMPRESSED WORK WEEKS ...............................................19 SHIFT WORK .............................................................19 TEMPORARY POSTINGS TO ANOTHER JURISDICTION OR COUNTRY .................20 GREATER RIGHT OR BENEFIT ..................................................20 UNIONS AND COLLECTIVE AGREEMENTS ........................................21 RELIGIOUS HOLIDAYS AND HUMAN RIGHTS ......................................21 IMPACT ON SCHEDULED PAY DATES ............................................22 IMPACT ON OVERTIME CALCULATIONS ..........................................23 IMPACT ON VACATION AND VACATION PAY .......................................24 LEAVES OF ABSENCE ........................................................24 STATUTORY HOLIDAYS AND TERMINATIONS OF EMPLOYMENT ......................25 RECORD OF EMPLOYMENT ...................................................26 WRITING A STATUTORY HOLIDAY POLICY ........................................29 FEEDBACK ...........................................................30 TEST YOUR KNOWLEDGE ..............................................31 ANSWERS ..................................................................32 RESOURCES .........................................................34 FACT SHEETS AND ONLINE TOOLS .............................................34 ACKNOWLEDGEMENTS ................................................36 Statutory Holidays Payroll Best Practice GuidelinesTM INTRODUCTION As the authoritative source of Canadian payroll knowledge, one of the objectives of the Canadian Payroll Association (CPA) is to publish guidelines that can be referenced as CPA Payroll Best Practices for payroll practitioners and their employers. A challenge for many payroll professionals is having their employers understand that payroll is mission critical and requires in-depth knowledge and skills to ensure compliance. The CPA guidelines can assist organizations with preparing for a payroll audit. They can also provide benchmarking tools for designing and/or implementing Payroll Best Practices. These guidelines were created by a task force of CPA staff and subject matter expert payroll professionals, ensuring both the accuracy of the information and the practicality of its application, based on real-life experiences within various organizations. The CPA would like to thank the subject matter experts for their participation on the task force and their contributions to these guidelines. CPA members should direct any legislative questions on these guidelines to: The Canadian Payroll Association’s Payroll InfoLine Toll-free: 1-800-387-4693 ext. 772 Phone: 416-487-3380 ext. 772 Email: [email protected] KEYWORD SEARCH AND HYPERLINKS When viewing any of the CPA’s guidelines online, readers can search for keywords appearing within the document. For example, if information is required on a certain word or phrase, type the word or phrase in the search window (activated by pressing the “Ctrl” and “F” keys simultaneously on most applications). These guidelines contain hyperlinks within the document itself. All government forms, guides and websites discussed within the guidelines can also be accessed using these hyperlinks, which were active at the time of publication. Up-to-date links to major government websites such as Canada Revenue Agency, Service Canada, Revenu Québec and employment/labour standards can be accessed through the Compliance www.payroll.ca/Resources/Important-Links/Government-Links page on the CPA’s website, payroll.ca/paie.ca. There is a quiz at the end of the document to test your knowledge and you can also take the quiz online by visiting the guidelines section of our website (payroll.ca ➜ Resources ➜ Payroll Guidelines). Note: These guidelines provide general information about selected issues concerning payroll legislative and compliance issues, and/or employment and taxation laws. It is not legal advice and should not be relied upon as a substitute for legal counsel. Every effort has been made to provide accurate information; however, we advise you to seek legal counsel and advice from a qualified lawyer regarding your specific situation. Legal obligations vary according to the facts and circumstances, as well as the jurisdiction. 1 Statutory Holidays Payroll Best Practice GuidelinesTM STATUTORY HOLIDAYS PAYROLL BEST PRACTICE GUIDELINES Some of the most challenging requirements regarding statutory holidays involve the assessment and calculation of statutory holiday pay, especially in relation to other considerations such as multi-jurisdictional or union payrolls, shift work, overtime and vacation. The CPA’s Statutory Holidays Payroll Best Practice Guidelines can be used as Payroll Best Practices against which employers can assess their current procedures for determining their obligations to employees regarding statutory holiday pay. These guidelines will assist payroll practitioners with assessing an employee’s right to statutory holidays and with calculating the corresponding payment. The guidelines will focus on compliance regarding the following: • entitlement to the statutory holiday • calculation of statutory holiday pay • working on a statutory holiday • impact of the statutory holiday on overtime calculation, scheduled pay dates, vacation pay and termination of employment Each jurisdiction (i.e., every province and territory) has established its own minimum standards for statutory holidays. These guidelines will cover each jurisdiction’s regulatory requirements. An employee’s possible entitlement under a greater right or benefit will also be explained. Note: In a unionized environment, employers must refer to the collective agreement or decree for statutory holiday entitlement. Employees covered under these legal arrangements should be entitled to at least the equivalent minimum standards. TOP AUDIT REVIEW While it is imperative that employers ensure all minimum standards are met, statutory holidays are among the top employment/labour standards complaints and often the number one cause of violations discovered during targeted investigative audits. (See Ontario’s Investigation and Inspection Statistics as an example in the following link: http://www.labour.gov.on.ca/english/es/pubs/enforcement/investigations.php.) TERMINOLOGY Certain employment/labour standards boards across Canada may refer to statutory holidays as general or public holidays. For the purpose of these guidelines, the term “statutory holidays” will be used to refer to all such holidays. In addition to statutory holidays, some jurisdictions observe other days such as civic holidays. These will also be addressed. When the term “average” is used to calculate a regular day’s pay, wages (or hours in some cases) for a specified period will be added and then divided by a certain number of days in that period, or multiplied by a prescribed percentage. For example, when calculating the average daily wage in Alberta, regular wages earned in the four weeks immediately before the holiday are multiplied by 5%. In Newfoundland and Labrador, the average daily wage is calculated by multiplying the hourly rate of pay by the average number of hours worked in the three weeks before the holiday. 2 Statutory