Part Time Staff and Vacation Time/Pay: MOL Clarification!

I have learned some important information from the Ministry of Labour (MOL) regarding the tracking of vacation pay and granting vacation time off for Part Time employees.

I attended an MOL hearing last week for a terminated employee who was claiming his former employer did not pay him vacation pay or give him vacation days off during the two years he worked part time for the employer (he worked there for just over five years in total).

The vacation pay paid out and time off had not been recorded properly, and the employee could have won that part of the case.

At issue was the fact that since Part time employees don’t work every day, there is sometimes a misconception that they do not get or need vacation time off the same way full time staff do. This is not true!

VERY IMPORTANT: New employees (part or full time does not matter) must be granted vacation time and pay as follows:

Vacation Pay must be paid to all employees at a minimum rate of 4% of their gross hourly pay and must be recorded on their pay stubs, both the accrual and pay out of the vacation money.  Vacation pay is paid from the first minute they work, even to probationary employees.

The part time employees should accrue (build up) vacation pay each pay period, and have this money given to them when they take vacation time off (more on this in a minute).

If your employee wants to have their vacation pay given to them on every paycheque, you MUST GET A SIGNED AGREEMENT from the employee, otherwise the MOL considers this money a gift to the employee, even if recorded as vacation pay on the paystub.

Vacation Time must be granted to part time staff in the same manner as the full time staff.  Record on the work schedule that the employee is on vacation, and keep a copy of the schedule in the employee’s file.  It is best to use a vacation request form to document that the employee has requested and been given vacation time off, which should correspond to the posted work schedule.

From start day until the first anniversary of work: NO VACATION TIME OFF SHOULD BE GRANTED, (but it does accrue) as they have not yet earned this time off, otherwise this time off becomes a gift if they stop working for you before the end of the first year.  The employee must then take the vacation within ten (10) months of accrual.

If your employee does not want to take vacation TIME OFF, you MUST get APPROVAL from the Ministry of Labour before this will be acceptable. Not just a signed agreement, but actual approval from the MOL.

So to sum up, you should not grant vacation requests to full and part time staff during the first year of employment in order to ensure that the employee is not obtaining “gifts” to which they would not otherwise be entitled.

You must carefully document and track the vacation TIME OFF given, especially to part time staff.