Employers and employees in Alberta should be aware of important changes made to provincial employment standards legislation effective September 1, 2019. These legislative changes are a result of the newly-elected provincial UCP government’s enactment of Bill 2: An Act to Make Alberta Open for Business (the “Act”).1
In addition to changes to Alberta’s Labour Relations Code2, the Act introduced changes to provisions of Alberta’s Employment Standards Code3, in the areas of holiday pay and overtime. While not part of Bill 2, the UCP also approved an Order in Council on May 27, 2019, to amend Alberta’s Employment Standards Regulation to create a lower minimum wage rate for employees who are both under 18 and a student. Many of these changes reverse earlier employment standards introduced by the previous NDP provincial government in 2017, with the introduction of the NDP’s Bill 17: The Fair and Family Friendly Workplaces Act 4(“Bill 17”).
These are the key changes that will be of the most interest and importance to employers and employees in Alberta:
Holiday Pay: effective September 1, 2019
Eligibility for holiday pay: To be eligible for holiday pay, workers must now work a qualifying period of 30 days or more in the 12 months prior to a general holiday (reversing changes enacted by Bill 17 that eliminated this qualifying period).
Distinction between a regular and irregular work day: Employers must pay holiday pay only when a holiday falls on a regular work day for an employee or if the employee actually works on the general holiday (reversing changes enacted by Bill 17, which did not distinguish between a holiday falling on an employee’s regular vs. irregular work day).
Calculating holiday pay: Holiday pay for employees will now be calculated as follows:
- If the employee does not work on a holiday that is a regular work day, the employee is entitled to their average daily wage, which is still defined as 5% of an employee’s wages, vacation pay and general holiday pay earned in the four weeks immediately preceding a general holiday.
- If the employee works on a holiday that is a regular work day, the employee is entitled to either:
- their average daily wage plus 1.5 times the employee’s wage rate for each hour of work; or
- the employee’s wage rate for each hour of work on that day plus one day’s holiday, not later than the employee’s next annual vacation, on a day that would normally be a work day (paid at the average daily wage).
- If the employee works on a holiday that is an unscheduled work day for that employee, the employee is entitled to 1.5 times the employee’s wage rate for each hour of work.
- When an employee works an irregular schedule for which it is uncertain whether the holiday falls on a normal work day for that employee, the employee will be entitled to holiday pay if the employee worked on the same day of the week as the holiday in at least five of the nine weeks preceding the holiday.
Overtime Pay: effective September 1, 2019
- Employee overtime (“OT”) may be banked and taken as time off on an hour-for-hour (1:1) basis, if there is an overtime agreement in place between the employer and employees. This reverses the requirement under Bill 17 that employers give banked OT hours at a ratio of 1.5 hours off for every OT hour banked.
- If there is no overtime agreement, then OT hours cannot be banked and an employer must pay an employee OT pay for OT hours at the rate of 1.5 times the employee’s wage rate.
- OT under an overtime agreement may still be banked for up to six months (or longer if under a collective agreement) before it must be taken or paid:
- Time off with pay earned prior to September 1, 2019 that was not provided, taken and paid before September 1, 2019 must be provided at 1.5 hours off for each hour of overtime worked.
- No change to OT pay at 1.5 times an employee’s normal hourly rate of pay.
- No more Flexible Averaging Agreements.
Youth Minimum Wage: effective June 26, 2019
The minimum wage for student employees under the age of 18 has been reduced from $15.00/hour to $13.00/hour:
- This will apply to employees enrolled in an educational institution (such as school up to grade 12, post secondary or vocational school).
- The reduced minimum wage will apply to work performed during a student’s school break, summer holiday, or for the first 28 hours in a work week.
- For hours worked over 28 hours in a work week, the student employee must be paid minimum wage at the standard rate of $15.00/hour.
- Overtime rules still apply.
- Employers can still choose to pay students more than the minimum wage.
further CHANGES ANTICIPATED
We expect further changes to labour and employment laws in Alberta to be announced in the coming months, and will continue to provide updates in the development of the law as it is released by the provincial government. Please subscribe to receive these legal updates as they develop.
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Whether you are an employee or an employer, Carscallen’s experienced team of Employment, Labour and Human Rights lawyers can assist you. Our lawyers specialize in practical, individualized advice to help you understand your rights, duties and responsibilities as an employer or an employee.
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Contact any member of our Employment, Labour and Human Rights team with any questions you may have about how these legislative changes may affect your business, or any other labour or employment-related issues.
*This update is intended for general information only on the subject matter and is not to be taken as legal advice.
2Labour Relations Code, RSA 2000, c L-1.
3Employment Standards Code, RSA 2000, c E-9.