When must employees take the vacation time they have earned?

One of the fundamental employment standards entitlements is vacation time. Sometimes, for a variety of reasons, employees might want to either defer or waive their right to this time. Are employers permitted to grant these requests?

This really several different questions. Before we can get to these, a little background is in order.

Entitlement to vacation time and pay is earned over what are termed vacation years, also termed entitlement years. These are usually based on the anniversary of employee hire, but may also be an employer-defined common year. Employees who complete vacation years are entitled to take vacations in the next year. Employment standards define when these must be taken, but the longest gap generally permitted between earning a vacation and taking it is 12 months. For example, if the employer uses June 1st as the start of each vacation year, an employee who completes a year of employment, ending May 31, 2012, must be given the vacation time earned for that year, no later than May 31, 2013.

We should also be clear that we are talking about minimum requirements related to time. Where the employment standards require vacation pay, this requirement is absolute. No jurisdiction allows employees to waive or defer the right to vacation pay. Employers also often provide more vacation time, and pay, than required under the applicable employment standards. Such additional time is also beyond the scope of this article. While it’s certainly true that employers often impose ‘take-it or lose-it’ policies on such additional time, the requirements described below only apply to the minimum vacation time specified in the applicable employment standards.

The questions then are, when may these minimum standards be waived or deferred? The answers are given in the table below:

Jurisdiction

Normal Limit for Taking Vacation Time

Vacation Time May be Delayed

Vacation Time May be Waived

Federal

10 months

By agreement between employer and employee

By agreement between employer and employee

British Columbia

12 months

No

No

Alberta

12 months

No

No

Saskatchewan

12 months

No

By agreement between employer and employee, filed with employment standards

Manitoba

10 months

No

No

Ontario

10 months

No

Subject to employment standards approval, by agreement between employer and employee

Quebec

12 months

By collective agreement; By agreement between employer and employee, if an employee is absent or is on leave

By collective agreement; Employees may also waive the 3rd paid week, where the remaining 2 weeks are taken during  plant shutdown.

New Brunswick

4 months

No

No

Nova Scotia

10 months

No

By employees with less than 90% of regular working hours in a vacation year

Prince Edward Island

4 months

No

By employees with less than 90% of normal working hours in a vacation year

Newfoundland and Labrador

10 months

No

No

Yukon

10 months

No

By agreement between employer and employee

Northwest Territories

6 months

The employer and employee may agree, subject to filing with employment standards; or the employee, alone, may ask for approval, directly from employment standards

Subject to employment standards approval, by agreement between employer and employee

Nunavut

10 months

The employer and employee may agree, subject to filing with employment standards; or the employee, alone, may ask for approval, directly from employment standards

Subject to employment standards approval, by agreement between employer and employee

While generally the above table is straightforward, there are a couple of points to note.

Generally any employer or employee agreement or request to defer or waive vacation time must be in writing, particularly where such a request or agreement must be submitted to the applicable employment standards authorities. No such written requirement applies to an employee request in Quebec, to waive the 3rd, employment standards required week of vacation.

With only a couple of exceptions, employers may either agree, or not, to such a waiver or delay request. In Nova Scotia and Prince Edward Island where employees are eligible for such a waiver, they may require employers to grant such a waiver or delay, by asking the employer in writing. In the Northwest Territories, employees may make direct application to the employment standards authorities for an order requiring the employer to postpone the taking of vacation time. Apart from these exceptions, there is nothing requiring employers to grant a waiver or delay requested by employees.

Lastly, it’s also important for employers to understand the time limits in the above table. This is either the number of months within which any required vacation time must be completed or is the number of months by which any required vacation time must have started. For example, in Ontario, if a vacation year ends on May 31, any vacation time earned in that year must be completed by the end of the following March. Vacation time must be completed within the number of months given in British Columbia, Saskatchewan and Quebec. However, in the remaining jurisdictions (federal, AB, MB, NB, NS, PE, NL, YT, NT and NU) the employment standards requirements are met, so long as any vacation time starts within the number of months specified.

Alan McEwen is a Vancouver Island-based HRIS/Payroll consultant and freelance writer with over 25 years’ experience in all aspects of the payroll industry. He can be reached at armcewen@shaw.ca or (250) 228-5280. If you like these articles, please consider buying one of my Need to Know resources. Signup to my email list to be notified as new resources are added, including webinars and seminars.

 

About Alan R. McEwen

HRIS/Payroll consultant and freelance writer
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One Response to When must employees take the vacation time they have earned?

  1. Kathy Baxter says:

    Alan, thank you very much for this “reminder” article.

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