You may unsubscribe at any time. Information is current as of the date published; overtime changes may have been made since this article was created. If you leave overtime decisions to employees, you risk overtime becoming an opportunity for an employee to stay late and catch up on a few things just to make extra money, Using full-time employees to regularly work 10 hour days to provide, Allowing overtime to build and accrue indefinitely as time off in lieu. Exempt employees are those who can be asked or forced, to work overtime above and beyond their normal hours, without receiving overtime pay. Non-exempt employees represent most of the workforce, hourly and salaried alike. Hours worked. There are some professions and industries that are either not covered by certain parts of the ESA or have different rules specifically for them with respect to employment laws and rights in Ontario, like the rules regarding overtime pay. Next for you to read is our post on who is entitled to severance pay. Most employers opt to ask workers if they can take on overtime, and do not force it. A similar rule applies to construction workers who construct bridges, tunnels or retaining walls in connection with streets or highways, except their overtime pay entitlement starts after 50 hours in a work week. DISCLAIMER: This post is for educational and informational purposes only. Construction Ontario trains with the future in mind. Whats more, the labor law is complicated, and many construction firms fail to comply with every aspect of it. Our experienced experts provide services in e-learning, customized training programs, state-of-the-art virtual reality training, and recruitment. Your use of this website is entirely at your own risk. To calculate overtime pay simply use the following formula: regular pay rate x 1.5 = overtime pay rate. Different rules apply to construction workers than to maintenance workers, even if the jobs seem pretty similar. These sectors include agriculture and some public sector roles. A. Road maintenance workers, like construction workers, dont have ESA protections around daily or weekly limits on hours of work, daily rest periods, time off between shifts, weekly or bi-weekly rest periods. Hospitality services and sales. Yes, hourly employees can be scheduled for overtime, however, if the employee has another responsibility, for example, childcare, the employer cannot schedule workers during this time. Although an employment contract or collective agreement can give you more rights than the ESA, they cant give you less. An employee worked overtime hours the employer did not authorize or pre-approve. Occupational health and safety for young workers. Construction overtime is the pay given to employees for every hour they work over 40 hours a week. In Ontario, overtime pay is 1.5 times an employee's normal rate of pay for every hour worked in excess of 44 hours in a single week. Over time, youll find that your need to pay 1.5x for overtime dramatically reduces and that your projects get completed on time and within budget. For those who have more availability, take advantage of cross-training so they can jump into other roles as needed. These surplus 10 hours per week are paid at the standard hourly rate and mean you are no longer required to pay an extra 50% for employees to complete the tasks using overtime. Designed by Brand Ambition. Or, they can drive over to help with another job. However, some industries have special overtime rules, and some workers are exempt from receiving overtime. For example, in Manitoba employees who substantially control their hours of work and earn more than twice the average industrial wage may be exempt from the hours of work and overtime provisions.. They receive this pay even if they never work on a general holiday. Its important to know that, unlike other industries, construction is not able to benefit from the FLSA Section 13(a)(1) exemptions. Construction companies using independent contractors often treat them like employees. Ontario construction workers may be surprised to find that they have different rights to overtime pay, severance pay and holidays or vacation than other workers. Your Guide to the Employment Standards Act, 2000. Importantly, in the construction industry special rules and exemptions apply to things like termination and severance pay. Exempt status is not determined by hours of work, but by your industry and the nature of your job. The accuracy of McMahon Molyneaux Henriquez Labour & Employment Lawyer posts are not guaranteed, and laws may change from time to time. Speaking of severance and termination pay, check out our severance pay calculator in Canada for a ballpark figure of how much severance pay you may potentially be entitled to. The 45 th and 46 th hours were worked as punch press operator and the 47 th and 48 th hours were worked as a shipping logistics coordinator. Retrieved June 12, 2014, from http://www.labour.gov.on.ca/english/es/pubs/guide/publicholidays.php. Unlike most Ontario employees, if a construction worker has been employed for less than five years and receives 7.7% or more of their wages in vacation or holiday pay, they are not entitled to additional public holiday time and pay. You can see where your crews are, how much time has been put into a project so far, and even when theyre in transit to get more supplies. Federal overtime rules in Canada set a general threshold of 44 hours per week. Minimum standards for regular and overtime hours Employees must receive overtime: for hours worked in excess of 8 hours per day or 44 hours per week, whichever is greater Long-term, look at reducing downtime and increasing productivity with GPS time tracking apps like Hubstaff. EORs like Canadian Payroll Services stay on top of changes in local employment law and payroll rules and keep you compliant through their many changes. Overtime pay may be taken as 1.5 hours of paid time off (time in lieu) for each hour of overtime worked, If overtime is taken as paid time off (time in lieu), the employee must take the time off no later than three months after overtime occurred. Its federally mandated and must be paid at 1.5x the workers typical hourly rate. If you work 44 hours or more then you get paid one and a half times for each overtime hour worked. Tools like Hubstaffs time tracking with geofences for construction make it easier to understand what your employees are doing throughout the day by sending daily time cards straight to your inbox. We deliver supportive and innovative customized training solutions for small, medium, and large construction employers. However, there are two downsides to using independent contractors: They are often more expensive per hour compared to employees. Temporary workers can be as skilled as your current employees and can take up the additional responsibility of completing tasks and jobs on-site. If your employer owes you overtime pay for previously worked hours, speak to an employment lawyer right away. Most employees dont mind working extra hours in a crunch, and some even welcome the opportunity to make extra money. If your roofing team can work 30 hours a week and get their tasks completed properly and on-schedule, each employee has a spare 10 hours per week they can spend on a second project at the same site. the overtime threshold is 55 hours per work week, Although if the employee works less than 55 hours in the previous week, the difference between those hours worked and 55 (to a maximum of 22) may be added to the present week's overtime threshold. (n.d.). This applies to hourly and salaried employees and those who earn commissions. v. How to reduce or eliminate construction overtime, Start reducing construction overtime costs now, Hubstaffs time tracking with geofences for construction, accurately tracks hours and locations throughout the workday. However, if overtime is excessive or sustained, it might be time to look at other alternatives. The Ontario Employment Standards Act governs how employers in Ontario manage overtime. As the Ontario Employment Standards Act requires employers to pay qualifying employees 1.5 times their hourly rate for time worked above 44 hours in a week, Ontario startups will recognize that overtime pay costs 50% more money. The general threshold for overtime in Canada is 40 hours per week but is higher in Ontario (44), Nova Scotia (48), and PEI (48). Construction overtime is the pay given to employees for every hour they work over 40 hours a week. Remember: contractors are subject to different rules compared to employees, and you must treat them differently. However, understanding overtime rules can be tricky. In addition to the special rules and exemptions for construction workers, more special rules and exemptions apply to road building. Road building can involve things like constructing or maintenance of streets, highways, parking lots, bridges, tunnels or retaining walls in connection with streets or highways. Copyright 2022, Ertl Lawyers. It's something managers and owners try to avoid at all costs. This results in excessive time off that impacts business operations, Too much reliance on a single resource so that work cannot be shared effectively in times of a heavy workload. The overtime rules in Canada are different depending on which province you are in. First, add up the total hours worked for that week for one employee. Overtime Pay for Hourly Employees Overtime pay in Ontario pay is 1 times the hourly employee's regular rate of pay. Overtime hours were not properly documented. Subject to s. 22 (1.1), s. 22 (1) sets out the general overtime premium of one and one-half times the employee's regular rate of pay for each hour of overtime worked in each work week. Thats why so many global companies rely on Employer of Record providers when hiring in Canada, who take on compliance for them. By Monkhouse Law / November 10, 2020. Our experienced, local team of certified payroll administrators and HR account managers can advise you on overtime rules for your exempt and non-exempt employees, no matter what province theyre located in, and our local employment law partners can help to classify your employees so theres no chance of overtime violations. The only workers exempt from overtime entirely are independent contractors. To find out more, please visit our Privacy Policy. On the other hand, if youre constantly up-to-date on everyones hours, and can see how much of the project budget has been used, its much easier to adjust the schedule. Heres an example of how this might look if an employee works an extra 15 hours one week. There is a common misconception that employees getting paid a salary do not get paid extra for working over 44 hours in a week, or that their salary covers all the hours worked in a week. This helped Everbuild to streamline payroll and eliminate the time-consuming process of reporting hours. Call for a FREE Consultation | 888-222-6184. Since the Ontario overtime pay threshold is 44 hours, Mike has worked a total of six hours of overtime. Yes! But the willingness will wear off and employees will become tired, frustrated and unhappy in their job. This article is intended to convey general information only and not to provide legal advice or opinions. An employer and employee cannot make an agreement that an employee will give up their right to overtime pay, and an employer cant lower an employees pay to avoid paying time and a half after 44 hours. Yes! Total. Manufacturing, construction and mining. Once youve implemented Hubstaff time tracking to track crews and their shifts, itll be easier to identify who has more time and who has a full schedule. Calculating overtime pay for workers employed by the hour is a straightforward equation of: Overtime Pay = (total number of hours 44) x hourly wage x 1.5, Things get a little trickier for salaried employees, those who earn commissions and when calculating holiday pay. Agriculture, growing, breeding, keeping and fishing. Every hour of overtime worked is paid at 1.5x the workers typical hourly rate its that simple. But the ESA doesnt apply all the time or to every type of worker. More information on hours of work and overtime pay can be found in Your Guide to the Employment Standards Act, 2000 available at Ontario.ca/ESAguide. If youre thinking of using temporary workers, start now by building up a network and a contact list of workers who are available for short notice and short-term work. Ontario Ministry of Labour. Running as a lightweight app on your teams mobile devices, Hubstaff accurately tracks hours and locations throughout the workday. For serviced housing accommodation, $99.35 a week. The law doesnt classify independent contractors as employees, and youre not required to pay them overtime. However, there are limits. Subtract 40 from the total number of hours to get the number of overtime hours. The act sets out the rules and minimum standards employers and employees must follow, when it comes to: minimum wage and payment of wages tips and gratuities hours of work, lunch periods and overtime pay public holidays and public holiday pay vacation time and vacation pay Speak to an employment lawyer if this scenario applies to your role. 6 hours X $22.50 (overtime at time and a half) = $135.00. They include (among other fields): Follow this link for all of the jobs that fall under this category and the rules that apply to each. Add up how much you made in total for the week or 2-week period. All Rights Reserved, http://www.labour.gov.on.ca/english/es/pubs/guide/publicholidays.php, Overtime is generally payable after the employee has worked 44 hours in a work week, Overtime must be paid at a minimum of 1.5 times the employees regular rate. However, you should be ready to pay specialists for their expertise. No lawyer-client relationship is created by accessing or otherwise using Ertl Lawyers website or by communicating with a lawyer or staff member. If you fail to pay overtime or are found to have wrongly denied overtime pay to non-exempt employees, you will be forced to pay all back overtime pay and may have fines levied. Overtime for employees in federally regulated workplaces such as airlines, banks and Canada Post are governed by the rules in the Canada Labour Code. Now, let's suppose that the nonexempt employee worked 45 hours during a particular workweek. This is an employers decision. Contacting McMahon Molyneaux Henriquez or using this website does not create a lawyer-client relationship. These laws differ from country to country, and often in unexpected ways. Contractors are entitled to different working practices compared to employees, and all construction companies should be aware of this. Overtime can be administered by paying employees for time worked, or by offering time off in lieu. Then, look into hiring subcontractors or short-term workers to pick up jobs on-site and keep overtime hours down. If the number of hours of work varies from day to day, the hours must be averaged to determine the number of hours to be considered as a day of work. For employees who earn commissions as part of their compensation, you simply: Thats it! If you would like legal advice or have questions about your particular workplace problems, please contact a lawyer. Hubstaff was built to empower teams with transparency, access, and control of their data, Simplify scheduling with automated attendance tracking, Pay teams faster and more easily based on hours worked, Create custom invoices and send them right from your dashboard, Create, assign, and track time to Work orders for various clients, Embrace Agile with user-friendly, collaborative task management, Manage your Sprints more easily and automate Sprint planning, Work asynchronously and limit meetings with virtual Stand-ups, Clock hours on specific projects for better project planning and reporting, Manage remote and hybrid teams with greater visibility and productivity, Create schedules, Work orders, and geofenced Job sites for your team, Track time, see project spend, and create automatic invoices for your agency clients, Easily bill clients for hours worked and track invoices, Manage consulting projects, invoicing, and payroll from one software, Automate billable hours tracking and invoice dev clients, Manage your e-commerce teams with timesheets and productivity features, Set up Job sites with geofenced time tracking and scheduling for your crew, Schedule cleaning teams and track hours with real-time GPS tracking, Sync time tracking and project management with two integrated tools, Pair Hubstaff with Jira for better project management, Track time to specific Trello boards and cards with Hubstaff, Link Quickbooks and Hubstaff for more efficient payroll, A time tracking and productivity suite for OS X Mavericks or newer, A time tracking and productivity suite for Windows 8 or newer, Lightweight time tracking that runs quietly in the background on Linux, Track time and GPS location from the iOS app, Track time and GPS location from the Android app, Track time to specific projects straight from your Chrome browser, 11650 Olio Road, Suite #1000 - 193 Fishers, IN 46037. Divide the total by 44, or 88, to get your hourly wage. Employers, in Ontario and elsewhere, with a regular need for overtime should consider less expensive alternatives, such as hiring more staff (either part-time or temporary), outsourcing or introducing automation or process improvements. The employment contract states that overtime hours are included/assumed in the compensation or stipulates that overtime pay will not be given, contrary to the ESA. Household, landscaping and residential building services. What is Severance Pay in Ontario? These sectors include agriculture and some public sector roles. If you lay, alter or repair sewers and watermains, additional exemptions and special rules apply. How can businesses increase productivity with a PEO? The employee's overtime threshold is 44 hours and the overtime rate is 1.5 times the regular rate. This is against the law. Such a determination can be made only by an employment standards officer, an arbitrator or arbitration board, the Ontario Labour Relations Board or the courts. (5) If an employer provides room or board to an employee, the following are the amounts which shall be deemed to have been paid by the employer to the employee as wages for the purposes of determining whether the minimum wage has been paid: 1. 32 hours X $15.00 (base rate) = $480.00. It may not cover aspects of your particular situation and it does not produce a legally binding determination about whether the Employment Standards Act ( ESA) is being complied with. They take on in-country compliance and payroll, allowing you to expand your team without opening a local subsidiary, or hiring a local payroll and HR team. Contact us by phone toll-free at 1 (800) 771-7882 or email us at info@achkarlaw.com and we would be happy to assist. As employment lawyers in Ontario, we know the vast majority of workers dont know that they are not getting what they are fully entitled to. Multiply the hourly wage by 1.5 to calculate your overtime rate. EMS, healthcare and health professionals. The benefit of this is that you can reassign tasks when you need to, and prevent overtime hours. Aside from sectors that are exempt from overtime rules, certain job classifications and roles are exempt, including managers and supervisors. For example, if 40 hours are worked in Week 1, the overtime threshold for Week 2 is [55 + (55-40 . If that work is done regularly (e.g., every day or every week), whether it is scheduled or not, they may be eligible for overtime pay. Overtime Pay for Salary Employees Our Mission If you run a construction company, youre probably well aware of overtime pay. Copyright 2022 Canadian Payroll Services, How to Access EI Benefits as a Self-Employed Worker. This means that overtime pay applies to all of your construction employees. Since 2010, Nevada has recovered over $19 million from 1,615 companies that violated the FLSA. Getting it wrong can have serious consequences for your business. The exceptions are managers and supervisors. In one work week, the employee worked four hours of overtime. As the employer, monitoring overtime enables your startup to: Sustained use of overtime increases salary costs by 50% for the overtime worked. Serving all of Ontario, including: Ontario West (Windsor, London, Kitchener-Cambridge-Waterloo, Guelph, Brantford, Sarnia), Central Ontario (Barrie, Orillia, Peterborough), Southern Ontario (St. Catharines-Niagara, Hamilton, Burlington, Oakville, Milton, Halton Hills, Brampton, Mississauga, Toronto, Caledon, Aurora, Markham, Newmarket, Richmond Hill, Vaughan, Whitchurch-Stouffville, Pickering, Ajax, Whitby, Oshawa, Bowmanville, Clarington, Brock, Scugog, Uxbridge, Port Hope), Ontario East (Belleville, Kingston, Brockville, Ottawa, Cornwall), Northern Ontario (North Bay, Sudbury, Timmins, Sault Ste. To calculate how much you earn working more than 44 hours a week when on a salary, you must first calculate what you earn per hour. Some states apply overtime provisions to certain industries or have a different rule for exemptions. Contact 905-522-0600 info@mmhlabourlaw.ca, Copyright 2022 McMahon Molyneaux Henriquez Labour & Employment Lawyers, Human Rights Tribunal confirms that Ontarios union members can file HRTO applications, Gender identity lessons for grade one student (and her teddy bears) not discriminatory, History of Labour Day in Canada The Fight for Fairness, Is your teen worker safe? An agreement to bank overtime hours must: Banked time (or lieu time) must also be used within three months of the employee earning them, or within 12 months of the week the overtime was earned, if the employee consents to it in a written agreement. However, an employer can make overtime mandatory for up to 13 hours in a day and 48 hours in a week. If non-exempt, employers must pay all hours beyond 40 at 1 times the hourly pay rate. This is in sharp contrast with most Ontario employees, who get overtime after 44 hours under the ESA. Overtime pay is decided or is governed by the Employment Standards Act 2000 in Ontario and in other provinces there is similar legislation that provides how the overtime pay is regulated in those provinces. This is in sharp contrast with most Ontario employees, who get overtime after 44 hours under the ESA. For example, in Ontario, an employer can force a salaried employee to work as much as 13 hours a day and 48 hours per week. Quebec In Quebec, you're eligible for 1.5 times your normal pay for work beyond 40 hours a week. It's federally mandated and must be paid at 1.5x the worker's typical hourly rate. As the way we work continues to evolve and schedules become more flexible, fewer people are required to stick to a 9 to 5, Monday to Friday workweek. Constructive Dismissal in Ontario Laid Off Sexual Harassment in the Workplace, Severance calculator Blog Videos Free Guides, 330 Bay Street, Suite 1400 Toronto, ON M5H 2S8, info@ertl-lawyers.com 416-572-9900 Toll free: 888-222-6184. However, the ESA does require Ontario employers to pay road maintenance workers termination pay (or provide notice) and severance pay. The fundamental concepts (the principles) in this lecture are equally applicable to other provinces but the legislation specific to . . The type of structure being built matters. Calculation. Track employee work hours across devices for more accurate timesheets, Get automatically generated timesheets from digital or manual time entries, Detailed time reports that help you improve business processes, Mobile apps track time to specific clients, projects, and work orders, Create location-based Job sites that automatically clock employees in and out, Know the right work is getting done with activity levels, screenshots, apps, and URLs. If an employee is entitled to 4% Vacation Pay, and their Gross Wages are $2,000.00 Regular Wages + $200.00 Overtime + $100.00 Stat Pay = $2,300.00 Gross Wages. This is simply not true. Just recently, a filing has been made against a stadium subcontractor in Nevada who has repeatedly been violating the Fair Labor Standards Act (FLSA). Compensate the employee with 1.5 hours of paid time off for every hour of overtime worked. This can have a significant impact on morale and productivity in the longer term. Depending on the province, yes, employers can force salaried employees to work overtime. For example, if an employee who has a regular rate of $20.00 works more than 44 hours in a week, each hour after 44 must be paid an overtime rate of $30.00 an hour ($20 1.5 = $30.00). Vacation Pay in Ontario: What You Need to Know, What Youre Entitled to During a Mental Health Leave. Local drivers( hourly) get overtime after 45 hours,,now this was 1978 in Ontario and still as far as I know.Used to work 4 8s' and a 9 on Friday,,company always tried to avoid OT '88K100 , Sep 24, 2020 Time + 1/2 after 8 hours, double-time after 12 (if calculated daily), Time + 1/2 after 8 hours a day or 44 hours a week, Time + 1/2 after 8 or 10 hours a day or 40 hours a week, Time + 1/2 after 8 hours a day or 40 hours a week, $17.63 (or more) + 1/2 after 44 hours a week, $19.125 (or more) after 40 hours per week. In this blog, we will go over federal and provincial overtime rules, who should be classified as an exempt or non-exempt employee, and how that affects your business! Instead, employees have to look to their contracts or union collective agreements for these rights. If the employer wants an employee to work longer than those maximums, the employee must agree to it. Disclaimer: The information in this guide and everywhere else on this website is for general information only and is not intended to provide legal advice of any kind. Agriculture, growing, breeding, keeping and fishing. Canadian Payroll Services specializes in helping global companies hire compliantly in Canada. Overtime can be an effective way for an employer to handle short-term pressures. To calculate the overtime amount, follow these steps. There are exceptions to these laws that are covered by regulations written under the ESA discussed in the next section. the overtime pay for each hour referred to in clause (a) is one and one-half times the regular rate that applies to the work performed in that hour. Employees who are considered exempt in their province of work cannot receive overtime pay. Check the regulations for your industry to see if the general or higher threshold applies to a given job. Usually, temp workers are available at the same or similar rates of pay as your employees. The potential of paying 1.5x pay for additional hours of work is not one that most construction company owners or managers want to entertain. When it comes to overtime, there are special rules and exemptions for road construction or road maintenance work. You are entitled to overtime pay if you meet 2 qualifications: number one you work more than 44 hours in a week in Ontario and secondly you are not exempt from earning overtime pay which is the topic of today's discussion. Like other construction workers, sewer and watermain maintenance workers are not entitled to severance pay under the ESA. Putting aside professions that have their own rules regarding overtime pay and other workplace rights, there are also some workers who are covered by other laws in the ESA, but excluded from itsovertime provisions. Keep an eye on your crews hours and your project budgets with accurate, up-to-date time cards. There are many nuances to overtime pay in Ontario that are detailed below, but if you ever have questions about overtime pay or your rights in the workplace, take advantage of a free consultation at Ertl Lawyers. They can slot into your site and take on time-consuming tasks that would push your full-time employees into overtime territory. They can take on tasks that your current employees arent skilled at doing, arent able to do, or dont have the time to do. This is often called being paid "time and a half". Ontarios newest bill what is the right to disconnect law? Now that you know exactly what the rules are regarding construction overtime pay and how to reduce your overtime costs, its time to get going. The Employment Standards Act, 2000 (ESA) governs minimum employment standards for Ontario employees. The results of cases described in these posts may not be typical and are not guaranteed. Thankfully, there are several ways to reduce your overtime bill (or eliminate it) and fully comply with the law. Generally, all employees in Ontario are entitled to receive overtime pay when they work more than 44 hours in a week. Their overtime wage is $20 * 1.5 = $30 per hour. Bringing on contractors can help you reduce overtime pay by allowing you to scale up your workforce when you need to. If you are an employer and want to ensure you are complying with overtime laws, or an employee who wants to know more about your rights, our team of experienced legal professionals at Achkar Law can help. Managers/supervisors for managerial/supervisory duties. Overtime must be paid at a minimum of 1.5 times the employee's regular rate. For the employer, both options present additional costs and scheduling risks. Marie). You may also wish to try the Hours of Work and Overtime Tool available at Ontario.ca/ESAtools. Overtime Compensation on PieceRate. One of the biggest challenges that global companies face when hiring internationally is understanding payroll rules and employment laws. (Make sure youre aware of the pay cut laws in Ontario and your rights!). The federal government mandates that overtime is paid to all non-exempt employees working over 40 hours per week. Finally, youll multiply that new hourly rate by the number of overtime hours to see how much you need to pay them. After that, employees can refuse additional overtime. For example, this commonly occurs with internet technology (IT) needs. If you average more than 44 hours per week over that period, youre entitled to 1.5 times your regular pay rate for each of those hours. That means if you usually make $20 an hour, you'd be entitled to $30 per hour for any additional hours you work once you've reached 40 per week.Most construction workers in Texas are non-exempt and entitled to overtime pay - particularly if they are . Manage on-the-go work crews with mobile app geofencing and live map views. Therefore, Mike's overtime pay can be calculated as follows: Regular pay: $750 / 40 = $18.75 per hour Overtime pay: $18.75 x 1.5 = $28.13 per hour Total overtime pay: $28.13 x 6 hours of overtime = $168.78 As long as that employee spends at least 50% of their hours doing work that is overtime pay eligible, their hours over and above 44 in a week will be calculated at the overtime rate. Many Ontario workers have jobs that require them to perform tasks that are both eligible and exempt from overtime pay. Overtime rules and classifying employees as exempt from them are one of those tricky rules. For more information about special rules and exemptions, the Ontario Ministry of Labour provides this accessiblespecial rule tool, or contact your union or an employment lawyer to discuss your specific entitlements. In some provinces, its clear cut, with managers and supervisors being exempt, along with several sector exemptions. Fail to do so, and you may end up facing fines. Learn five key steps that will help your startup implement ESG. These complex rules are why so many US employers opt to work with an Employer of Record, who can help keep you compliant when hiring in Canada! Overtime pay is 1 times the employee's regular pay rate, and is often referred to as "time and a half". Using temporary workers that you can pull in at short notice can help you eliminate overtime costs. What is Worker Misclassification and How Can it Impact Your Business? It doesnt define maintenance, and the difference between the two have been hotly debated in litigation. Federal overtime rules in Canada set a general threshold of 44 hours per week. Were more than happy to speak with you. Overtime pay may be taken as 1.5 hours of paid time off (time in lieu) for each hour of overtime worked If overtime is taken as paid time off (time in lieu), the employee must take the time off no later than three months after overtime occurred. The reason for this is simple: every hour of overtime worked means 50% higher costs and lower profits. To file a claim, you can access the Employment Standards Claim Form online at Ontario.ca/ESAforms. = $615.00. If you work less than 55 hours in a week, your employer can carry over the difference between the number of hours you actually worked and the 55 hour overtime threshold. If you, as the employer, offer time off in lieu of pay for overtime worked, the accrued amount of time off can become unmanageable for smaller organizations such as a startup. Overtime errors are one of the most common forms of wage theft and are not treated lightly. For example, you may have an averaging agreement with your employer to average out the number of hours worked over a specific period (up to a maximum of 4 weeks) and work a varying number of hours each week. For example: if employees work from June 1 to June 30, a period where there is not a general holiday, they would still receive 4% of their regular earnings as general holiday pay. In most provinces overtime can be banked as future time off, rather than paid out immediately as overtime. A similar rule applies to construction workers who construct bridges, tunnels or retaining walls in connection with streets or highways, except their overtime pay entitlement starts after 50 hours in a work week. For example, a long-haul trucker may not be able to count the hours they log driving towards their weekly overtime hours, but they may also spend several hours per week doing mechanical work or maintenance around the yard. For employees employed for five years or longer, this increases to 9.7%. The law defines the construction industry as businesses that are engaged in constructing, altering, decorating, repairing or demolishing buildings, structures, roads, sewers, water or gas mains, pipe lines, tunnels, bridges, canals or other works at the site.. 285/01, s. 25 (4). While at times every company may have a need for staff to work overtime, this should be carefully monitored. If you need legal advice, contact a Toronto employment lawyer at Ertl Lawyers. For construction workers, the ESA does not set maximum daily or weekly limits on hours of work, daily or weekly or bi-weekly rest periods, minimum periods of time off between shifts, or rules for notice of termination/termination pay and severance pay. If youre unsure where you fall, talk to a labour lawyer or your union. You then multiply your hourly wage by 1.5 to get your overtime rate and apply it to the total number of hours over 44 that youve worked in a week. If you construct streets, highways, or parking lots, at a minimum or do road maintenance work (like snow removal), you are entitled to overtime pay for each hour of work that you work over 55 hours in a work week. Now just multiply that amount by the Vacation Rate like $2,300.00 * 0.04 = $92.00 Vacation Pay. What is the Accessible Canada Act and Who Does it Benefit? Heavy equipment operators and construction employees qualify for overtime for work beyond 55 hours in a week. Superintendents, janitors, or caretakers of a residential building in which they reside. Likewise, the law treats construction employees differently when it comes to public holidays and vacation. Thankfully, there are several ways to lower or eliminate overtime. As an employer, startups should consult this law and seek legal advice as required. Any hours worked in a one week period in excess of 44 hours is considered to be Overtime Pay and should be paid at 1.5 times the employee's regular hourly rate for those overtime hours. Bringing on subcontractors to tackle a specific part of your build (e.g., electrical, concrete, or drywall) can save you from overtime expenses. For example, if an employee was making minimum wage at $14.00 an hour, their overtime pay rate would be $21.00. That said, you should always consult a professional before making payroll decisions as theyll know your business, employees, and state laws. Where does the right to overtime and severance pay come from? The federal government is taking a harder stance against companies that use contractors instead of hiring employees. Employers need to treat different classes of employees differently under the Act so make sure you understand who qualifies and the relevant rules. One construction company, Everbuild, uses Hubstaff to reduce the amount of time they spend tracking down crews and their time cards. Ontario construction workers may be surprised to find that they have different rights to overtime pay, severance pay and holidays or vacation than other workers. Generally speaking, employers are required to pay the overtime rate to all employees who work over 44 hours in a week, even if: So unless you work in an industry or a role discussed in the next section, your employer must pay you a minimum rate of one and a half times your regular wages for overtime hours including overtime hours previously worked that the employer has not yet paid to the employee. Workers who are scheduled or asked to work more than this must be paid overtime. The Most Common Types of Disabling Conditions and How to Deal with Them. Minus some exceptions to the rule, Ontario workers are entitled to overtime pay at 1.5 times their normal rate of pay (a.k.a 'time and a half') for every hour worked over 44 hours in a week. You can use the information you gain from Hubstaff to cross-train your employees, create better and more efficient schedules, and eliminate the need for overtime entirely. 2022 Copyright MaRS Discovery District. In 2019, a construction company in Florida had to pay over $178,000 in back pay for violating overtime rules and misclassifying workers as contractors. Reg. Were leaders in Ontario employment law, and well give you an honest assessment of your situation. What are the construction industry overtime rules? Some of these exemptions include: The full list can be found in Ontario Regulation 285/01: WHEN WORK DEEMED TO BE PERFORMED, EXEMPTIONS AND SPECIAL RULES under the ESA. For example, if you have a two-week averaging agreement, you may work 50 hours one week and 30 the next for a total of 80 hours over the 2-week period or an average of 40 hours a week. Professionals working in fields that include information technology (IT), healthcare, architecture, law, professional engineering, public accounting, and others. Hawaii, for example, states that an employee earning more than $2,000 on a monthly basis guaranteed is exempt from the state overtime law. An employee worked for a different employer who is related to their current employer. Learn more about Hubstaff from our in-house product specialist. Its something managers and owners try to avoid at all costs. Its that easy. Sometimes a manager must perform non-managerial work that would qualify for overtime pay. Unlike in America, overtime rules differ by province and each province has its own rules for who can and cannot receive overtime. How you can build an overseas customer service team in Canada. Workers who are scheduled or asked to work more than this must be paid overtime. Start by calculating your current overtime costs per week or month. TheEmployment Standards Act, 2000 (ESA) governs minimum employment standards for Ontario employees. Then, take that employees typical hourly rate and multiply it by 1.5. The right to overtime pay is set out in Section 22 of the Employment Standards Act of Ontario. Click here to contact Hamilton labour, employment and human rights lawyers Sarah MolyneauxorRoberto Henriqueznow. Laws governing overtime pay in Ontario are, for the most part, contained in section 22 of the Employment Standards Act (ESA.) You and your employer can also agree on a banking option of overtime hours youve worked to use them as paid time off at a later date. Its easy to unexpectedly reach overtime hours when youre only getting timesheets at the end of a pay period. The standard overtime rule of hours worked in excess of 8 hours a day or 44 hours a week, whichever is greater, applies to construction employees. In the construction industry, overtime applies to any worker, no matter how much they are paid or what their position is. Severance Pay Calculator Termination of Employment Terminated with Cause What is Wrongful Dismissal? Multiply your overtime rate by the number of overtime hours you worked. It's common for hourly employees with irregular shifts to have their Vacation Pay paid . Section 22 (1) of the Employment Standards Act, 2000 requires that "an employer shall pay an employee overtime pay of at least one and one-half times his or her regular rate for each hour of work in excess of 44 hours in . Failure to differentiate these two roles means risking a fine. Other provinces have complex tests for who can be qualified as exempt. It sets the minimum wage, hours of work, when overtime kicks in, vacation time and public holidays. Sewer and watermain construction workers are entitled to receive overtime pay for every hour worked above 50 hours a week. Certain employees are subject to different double pay laws. Minus some exceptions to the rule, Ontario workers are entitled to overtime pay at 1.5 times their normal rate of pay (a.k.a time and a half) for every hour worked over 44 hours in a week. However, some industries have special overtime rules, and some workers are exempt from receiving overtime. Hubstaff allows you to automate the clock-in process by setting up digital geofences around your various job sites. Well break these down below. Construction employees earn general holiday pay at 4% of their gross regular wages. A simple example is if an employee works 50 hours at $20.00 per hour, they will receive 50 - 44 = 6 Overtime hours. If you work at a road construction site on a street, highway or parking lot, you are entitled to overtime pay for each hour worked over 55 hours in a work week. Like the federal overtime rules, there are also a few industries, such as agriculture and some public sector jobs, where the general overtime threshold is higher. The Ontario Employment Standards Act details employers responsibilities with respect to managing overtime. These are our most Frequently Asked Questions regarding overtime rules in Canada: Depending on the province, most salaried employees are entitled to overtime. Dont forget to reference your states specific regulations around overtime pay. This section relates to employees who meet certain requirements and are paid the equivalent of more than $684 a week. Be in writing, e.g., in the employment contract. Any banked time that is unused when an employment is terminated is converted back to overtime-rated hours the employee is owed along with any severance and/or termination pay they may be entitled to. Therefore, the employer must pay the employee an extra $10.00 to bring the employee's total compensation for the week to $290.00, which represents 40 hours of work at minimum wage. If you recall from above, any hours over 40 per week for non-exempt employees are considered overtime. When someone enters or leaves a job site, time tracking automatically starts or stops. This means being at risk of fines, or even imprisonment, for failure to comply. You do this by simply dividing your weekly pay by 44 hours. 55 (total hours worked) - 40 = 15 overtime hours, $17/ hr (employees normal hourly rate) x 1.5 = 25.5, 15 (overtime hours) x 25.5 (overtime pay rate) = $382.50. However, employers can limit overtime banking with contract stipulations, and employees can opt to receive overtime pay, instead of paid time off. The rules are different for each industry, so its important to check the regulations for your industry. If you run a construction company, you're probably well aware of overtime pay. Many factors can affect an employees entitlements to things like overtime and severance pay, including employment contracts and union collective agreements, as well as the many special rules and exemptions in the ESA. There are exceptions to this rule, Overtime may be calculated either on a weekly basis or over a longer period under an averaging agreement, Avoid overtaxing employees, which can lead to problems with health and, Recognize and eliminate any abuse of overtime, Recognize when more staff may be required, Leaving overtime requirements to the discretion of the employee. Employer of record providers hire your international workers and then lease them back to you to direct. You can trade this for time off in most instances, as well. Many hourly workers are employed in industries with broad overtime exemptions, for example, agriculture, fishing, construction, and transportation. 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