Who doesn’t like a day off with pay? Nobody, that’s who.
Holidays like Thanksgiving and Victoria Day are known as “statutory holidays” or “stat days,” and many employees are entitled to a paid day off on those dates. If you’ve ever consulted your employee handbook to see if you will (or will not) be paid when working on or around these days, you’re probably pretty confused about the complexity of the rules. And it is confusing. There are many misconceptions about how and when employees should be paid for working stat days.
This is your lucky day because we’re going to set the record straight about some of the most common misconceptions around stat days. Starting with…
MISCONCEPTION 1: THE NAME.
The first little misconception we need to discuss is that while they’re commonly called “statutory holidays,” the Ontario Ministry of Labour considers these days “public holidays.” Knowing the proper name is important because the Ministry has excellent information and resources on their website, but you need to search for the correct name to find it.
MISCONCEPTION 2: WHICH DATES QUALIFY.
Many people get confused over which days are considered public holidays and which are not. Ontario has nine public holidays; can you name them all without looking them up? I’ll wait.
Ok, how did you do?
If you included the August civic holiday or Easter Monday in your list, you’re wrong. But you’re not alone. Those two days are not actually public holidays in Ontario, but many people believe they are.
Ontario’s nine public holidays are:
- New Year’s Day
- Family Day
- Good Friday
- Victoria Day
- Canada Day
- Labour Day
- Thanksgiving Day
- Christmas Day
- Boxing Day
Different provinces have different public holidays and different requirements for each. For example, Nova Scotia has 6 paid holidays instead of 9. Check your province’s employment standards to see what holidays are mandated, who qualifies, and how to calculate the holiday pay. Google “<your province> public holiday pay” to get started.
MISCONCEPTION 3: ALL EMPLOYEES ARE ENTITLED TO HOLIDAY PAY.
Under the Employment Standards Act (ESA), most employees in most industries are, indeed, entitled to public holidays with pay. But, there are many (many) exceptions and special rules across different industries. Again, the Ontario Ministry of Labour has a section on their website listing all industries and their rules and exemptions in the ESA, including public holidays.
MISCONCEPTION 4: SOME TYPES OF EMPLOYEES NEVER GET HOLIDAY PAY.
Some people think that certain types of employees, including part-time workers, contract workers, students, or new hire of less than three months, aren’t ever entitled to public holiday pay. According to the Ministry of Labour website: qualified employees can be full time, part time, permanent, or on contract. They can also be students. It does not matter how recently they were hired, or how many days they worked before the public holiday. Now, bear with us as we explain this. And you may need to read it over once or twice, but there’s really no other way to explain it. A “qualified employee” is an employee working in an industry subject to the public holiday rules of the ESA. And the employee has also met the “Last and First” rule, which brings us to the fifth common misconception…
MISCONCEPTION 5: EMPLOYEES MUST WORK THE DAY BEFORE AND THE DAY AFTER THE PUBLIC HOLIDAY TO BE PAID.
The “Last and First” rule is often misunderstood. Let us try to make this make sense. Let’s say an employee does not work the Friday before Labour Day, but he (or she) does work the Tuesday after Labour Day. Does this person qualify for public holiday pay? Some people believe this employee is not entitled to receive public holiday pay. In fact, the actual wording of the Last and First rule (from the Ministry’s website) is: generally, employees qualify for the public holiday entitlement unless they: fail without reasonable cause to work all of their last regularly scheduled day of work before the public holiday or all of their first regularly scheduled day of work after the public holiday (this is called the “Last and First Rule”); or fail without reasonable cause to work their entire shift on the public holiday if they agreed to or were required to work that day.
Note the phrases “without reasonable cause” and “regularly scheduled day of work.” An employee can be on a scheduled vacation immediately before or after a public holiday, or not scheduled to work, or on leave, or call in sick, and still qualify for public holiday pay. If an employee is only scheduled to work every Tuesday,and shows up for the shift on the Tuesday before and after the public holiday, then that employee qualifies. If the employee has “reasonable cause” for missing work, such as illness or a personal emergency, they still qualify.
MISCONCEPTION 6: PAYROLL SOFTWARE WILL TAKE CARE OF ME.
The final misconception we need to discuss relates to payroll software and public holiday pay. Many people assume that a bookkeeping program with payroll like Quickbooks or Simply Accounting/SAGE will automatically calculate the correct holiday pay. Wrong. In fact, it is up to employers to calculate the public holiday pay themselves. Because the rules vary by province (and by type of work), these programs do not do the calculations for you. Your provincial government’s website will have instructions on how to calculate holiday pay. The Ontario website has an online calculator to assist Ontario employers.
There now. Clear as mud?
If not, contact our bookkeeping team if you need assistance with public holiday pay. We are payroll experts and can help you with your payroll questions. (But if you contact us on a public holiday, we won’t be getting back to you for a day or two.)