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Working Wise - Vacation Pay

Dear Working Wise,

I have worked for my employer for more than 5 years and I have never had a problem booking my vacations. This spring, my employer approved 2 separate weeks of vacation, but they have now changed their mind. Can they do that?
Signed, Vacation Cut Short

June 29, 2016

Dear Cut Short,

Summer has finally arrived and those campgrounds, lakes, and backyard improvement projects are beckoning. Most employers try to accommodate staff vacation requests, but they are not required by law to do so.

Under Alberta’s Employment Standards, an employer can decide when an employee takes their vacation if a mutually acceptable time for an employee's vacation cannot be found. If an employer does decide when an employee is taking their vacation, the employee must take the vacation at that time.

Here are some rules employers need to follow when making their decision:

  1. Employees are entitled to two weeks of vacation with pay after 1 year of employment. After 5 years of employment, they are entitled to 3 weeks’ vacation with pay.
  2. Vacations must be given sometime in the 12 months after the employee becomes entitled to the vacation.
  3. If the employer and employee cannot agree on a vacation start date, the employer gets to decide. However, the employer must give the employee at least 2 week’s written notice before their vacation starts.
  4. Vacations must be given in 1 unbroken period unless the employee requests to take their vacation in shorter periods. This is permissible so long as those periods are at least 1 day long.
  5. If an employee is paid by monthly salary, they receive their regular rate of pay for the time of their vacation. Employees who are paid by the hour or weekly receive vacation pay as a percentage of their wages.
  6. "Wages" includes any previously paid vacation pay, but does not include overtime earnings, general holiday pay, pay in lieu of a notice of termination, an unearned bonus, tips and gratuities, or expenses.
  7. In the first 4 years of employment, minimum vacation pay is 4% of earned wages. In the fifth and subsequent years, minimum vacation pay increases to 6%.

Part-Time Employees

Part-time employees have the same vacation and vacation-pay entitlements as full-time employees. The one important distinction is that their vacation or vacation pay will reflect their reduced hours. For example, part-time employees who only work 2 days per week are entitled to 4 paid vacation days after 1 year of employment.

Construction Workers

Construction workers are not usually given annual vacation time, but are entitled to vacation pay. All construction employees (full-time and part-time) must be paid vacation pay equal to 6% of the employee's wages.

Other Exemptions

Here are some other workers who are exempt from vacations and vacation pay entitlements:

  • employees on a farm or a ranch
  • salespersons working mainly away from the employer's premises who solicit orders for later delivery
  • professionals such as real estate brokers, licensed insurance and securities salespersons
  • extras in a film or video production
  • employees covered by other Acts (such as academic staff)
  • municipal police officers

To learn more about vacations and vacation pay rules, call the Alberta Employment Standards Contact Centre toll-free at 1-877-427-3731 (780-427-3731 in Edmonton) or read the Vacation Pay tip sheet on the Employment Standards website.

Photo Credit: © iStockphoto/PeskyMonkey

Working Wise is a syndicated newspaper column prepared by the Government of Alberta to answer work-related questions from Albertans. Do you have a work-related question? You can send it to Charles Strachey (charles.strachey@gov.ab.ca), a manager with Alberta Community and Social Services.

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