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Questions about Public Holidays

What exactly does this provision do?

The new public holiday provision changes the formula for calculating pay for public holidays that occur on or after January 1, 2018, imposes requirements for employers to provide written statements to employees in relation to substitute days for public holidays and amends the exemption from the public holiday pay provisions for construction employees.

Why is this significant?

Employees are now entitled to public holiday pay based on an average day’s pay, rather than a pro-rated amount. Also, more employees will be entitled public holiday pay because employees who start employment in the pay period that includes a public holiday may be entitled to pay for that public holiday.

Employers will now be required to provide employees with a written statement that sets out specific information when the employee will be receiving a substitute day for a public holiday. Changes to the recordkeeping provisions require the employer to retain a record of the information contained in the statement.

Construction employees with five or more years of employment with the same employer will be exempt from the public holiday pay provisions only if they receive 9.7 per cent or more of their hourly rate for vacation pay or public holiday pay.

How is the new provision different from existing provisions in the ESA?

Before - The formula for the calculation of public holiday pay was based on the regular wages earned + vacation pay payable in the four work weeks before the public holiday divided by 20. This formula results in an employee receiving a pro-rated amount, calculated using the four work-week period before the public holiday.

After – The formula for the calculation of public holiday pay for public holidays that occur on or after January 1, 2018 is based on regular wages earned in the pay period immediately preceding the public holiday divided by the number of days worked by the employee in that pay period. Vacation pay is no longer included in the calculation. This formula results in an employee receiving an average day’s pay calculated using the pay period before the public holiday.

The amended provision also sets out situations in which a pay period other than the pay period immediately preceding the public holiday is used to calculate public holiday pay.

There is a new requirement for employers to provide employees with a written statement when the employee is given a substitute day off for the public holiday. Changes to the recordkeeping provisions require the employer to retain a record of the information contained in the statement for a period of three years after the information was given to the employee.

As a result of the changes to the vacation pay provisions (increasing vacation pay to 6 per cent for employees with a period of employment of at least five years), amendments to Regulation 285 have been made to exempt construction employees with five or more years of employment from the public holiday provisions if they receive 9.7 per cent or more of their hourly rate for vacation pay or public holiday pay. Construction employees whose period of employment is less than five years are exempt from the public holiday provisions if they receive 7.7 per cent or more of their hourly rate for vacation pay or public holiday pay.

What if the employee did not work in the pay period prior to the holiday?

If an employee was on vacation or on personal emergency leave or both for the entire pay period prior to the holiday, the pay period to be used in the calculation of the public holiday pay is the pay period before the start of that leave or vacation. If the employee was away on vacation or personal emergency leave for only part of the pay period before the public holiday, the calculation remains based on the pay period before the public holiday.

If the employee’s absence in the pay period immediately before the public holiday is for any other reason (for example pregnancy or parental leave, lay-off, etc.), the pay period immediately before the public holiday is still used. This could result in the employee receiving $0 as public holiday pay.

What happens if the employee was not employed in the pay period immediately prior to the holiday?

An employee who commenced employment in the pay period that includes a public holiday is entitled to public holiday pay based on the regular wages earned in the pay period that includes the public holiday divided by the number of days the employee worked in that period. Note: This calculation applies only if the employee was in an employment relationship as of the public holiday.

Can an employee and an employer agree that an employee will work on a public holiday?

There has been no change to the provisions relating to working on a public holiday. Generally, an employer and an employee may agree that an employee will work on a public holiday. If an employee is employed in certain operations including a hospital, a continuous operation, a hotel, motel, tourist resort, restaurant or tavern, an employer may require an employee to work on a public holiday that is ordinarily a working day for the employee.

Can an employee be given a substitute day for a public holiday?

Yes. The provision has not changed in that an employee may be given a substitute day for a public holiday.

However, if an employee is given a substitute day for the public holiday, the employer is now required to provide the employee with a written statement that sets out the public holiday, the date of the day that is substituted for the public holiday, and the date on which the statement is provided to the employee. The statement must be provided to the employee before the public holiday. The employer is required to retain a record of the information contained in the statement for a period of three years after the information was given to the employee.

Are there any changes to the exemption for construction employees?

Construction employees employed for less than five years are exempt from the public holiday provisions if they receive 7.7 per cent or more of their hourly rate for vacation pay or public holiday pay. Construction employees employed for five years or more are exempt from the public holiday provisions if they receive 9.7 per cent or more of their hourly rate for vacation pay or public holiday pay.

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