Employers and employees in Alberta should be aware of changes made to the Employment Standards Code, most of which will take effect this fall.
As expected, the new government has reversed many of the changes that the NDP implemented to employment standards in 2017. However, not all the changes that were made have been reversed. For example, employees still have access to all the new unpaid leaves that were introduced, such as personal and family responsibility leave.
This article reviews the major areas of change – most of which represent a return to pre-NDP law –including general holiday pay eligibility, overtime pay, and a lower minimum wage for students.
The government made these changes through Bill 2: An Act to Make Alberta Open for Business, which became law in Alberta in July 2019, along with some corresponding regulatory changes.
General Holiday Pay: Stricter Eligibility Requirements
Starting September 1, 2019, the restrictions around holiday pay will be tightened.
Employees will once again only earn holiday pay if they have worked for their employer for at least 30 days in the last 12 months before the holiday. This means that new employees may not be eligible for holiday pay in their first few weeks of employment.
… new employees may not be eligible for holiday pay in their first few weeks of employment.Employees will only get holiday pay if the holiday falls on a day that is normally a workday for the employee. If the holiday is on a day that is not normally a workday for the employee, and the employee does not work, the employee is not entitled to holiday pay. For example, if an employee only works Monday to Thursday, they are not eligible for holiday pay if the holiday falls on a Friday (unless they work on the holiday).
For employees that work irregular hours (for example, shift workers), eligibility is determined based on whether the employee worked on that weekday in at least 5 of the 9 weeks before the holiday. For example, if an employee has worked every Monday since April 29, 2019, the employee would get holiday pay for July 1, 2019 (Canada Day).
Another restriction is that an employee is not entitled to holiday pay if the employee:
- does not work on a general holiday when they were required or scheduled to do so, or
- is absent from work, without the employer’s approval, on the employee’s last regular work day before, or the employee’s first regular work day after, a general holiday.
The government described these changes as “reducing burdens on job creators by returning to the previous general holiday pay and banked overtime rules.”
Overtime Pay: Back to Straight Time
Starting September 1, 2019, employees will no longer be able to bank time off at time and a half. The ability to earn 1.5 hours off for every hour of overtime worked was one of the most significant changes made by the NDP, from the average employee’s perspective.
… the government has also repealed Flexible Averaging Agreements …Under the new rules, time off in lieu of overtime pay will be banked at straight time, as it was previously. For every hour of overtime worked, an employee can bank one hour of time off (if there is an overtime arrangement in place with the employer).
Any overtime hours that have been earned, but not paid or taken, before September 1, 2019 will have to be used in accordance with the current rules (i.e. at time and a half).
Because of this change, the government has also repealed Flexible Averaging Agreements, an arrangement that allowed for employees and employers to enter into an agreement with respect to overtime hours. Flexible Averaging Agreements that are already in effect will remain valid until the earlier of the cancellation date of the agreement or August 31, 2021.
Minimum Wage for Students
… the minimum wage for students under 18 years of age has been reduced to $13.00 per hour.The government has reduced the minimum wage for young Albertans, effective June 26, 2019.
Specifically, the minimum wage for students under 18 years of age has been reduced to $13.00 per hour. The $13.00 per hour wage only applies where:
- the student is working less than or equal to 28 hours a week; or
- the student is working more than 28 hours a week, but during a school break. For example, a student who works 35 hours a week over spring break will be paid at $13.00 an hour.
However, students who work more than 28 hours a week when school is in session must still be paid at $15.00 an hour for any hours over 28 hours. For example, an employer must pay a student who works 40 hours a week during the school year at $13.00 an hour for the first 28 hours and $15.00 an hour for the remaining 12 hours. This is meant to reflect that students who work close to full-time hours are likely dependent on their employment income, as opposed to part-time workers who may live at home or have more financial stability.