Last month, the Canadian federal government tabled legislation to implement the remaining components of this year’s budget, including income tax allowances pertaining to new pooled pension plans, employment insurance measures, employment standards and Canadian payroll legislation.
As payroll consultant Alan McEwen writes in a recent article for the Canadian HR Reporter, the most extensive Canadian payroll compliance changes involve the provisions of the Canada Labour Code that pertain to due dates for vacation pay upon termination, the limits on employee complaints regarding unpaid wages and the calculation of statutory holiday pay.
Vacation pay due dates
Specifically, the new legislation would afford employers up to 30 days following the end of a worker’s employment in which to pay him or her any vacation pay owed. With regard to statutory holiday pay calculation, the requirement that employees work at least 15 days in the 30 days preceding statutory holidays is being done away with. However, workers must have been employed for at least 30 days in order to be eligible to receive statutory holiday pay.
Holiday pay calculation
Additionally, the current system of paying eligible employees whatever they would otherwise have earned is being replaced by a formula that determines holiday pay by taking the employee wages accrued in the prior four work weeks—excepting gratuities, tips and overtime—and dividing this total by 20. As the news source notes, the new federal approach is similar to that of Ontario.
In the case of workers paid on commission, those who have completed at least 12 weeks of employment will have their holiday pay calculated by taking their total earnings in the 12 prior work weeks and dividing this figure by 60.
Unpaid wage complaints
With regard to the limitations on employee complaints pertaining to unpaid wages, the new deadline to file a complaint is six months after the last due date for the wages in question. Additionally, inspectors’ ability to order employers to pay owed wages is now limited to 12 months prior to an employee complaint being filed, or to an inspection that resulted in a payment order, the media outlet explains.
Handling legislative changes can be complex, but by using payroll software solutions such as Sage BusinessVision Accounting’s payroll module, companies can swiftly and accurately manage payroll in-house rather than paying to outsource.
Read the full HR Reporter article here.
| Summary: | Proposed Canadian payroll legislation changes include vacation pay due dates, unpaid wage complaint limitations and holiday pay calculations. |
