The Employment Standards Act provides basic conditions of employment for workers under provincial jurisdiction throughout British Columbia. Although most of these standards are fairly clear, one area of frequent confusion is with respect to overtime.
1) What’s the general rule on overtime pay?
The general rule is that non-management employees are entitled to receive 1.5x their regular pay after 8 hours of work in one day or after 40 hours of work in one week. Workers are also entitled to receive 2x their regular pay after 12 hours of work in one day.
2) Are there exceptions to the rule?
Yes. The two main exceptions are for management and unionized employees. Unions have collective agreements which may have different provisions for overtime pay. There are also certain industries which are not covered by the general rule and may have their own regulations. These industries include oil and gas workers, farm workers, commission sales people, truck drivers and taxi drivers. A full list of exempt professions can be found in Part 7 of the Employment Standards Regulations.
3) Company policy states overtime is paid after 10 hours of work. Is this legal?
No. The requirements of the Employment Standards Act, including overtime provisions, are minimum requirements and an agreement to waive or reduce any of those requirements has no effect.
4) Are salaried employees exempt from overtime?
Not necessarily. Unless the employee is management or is covered by another exemption, they would be entitled to overtime even if they are salaried. The employer would be required to calculate the employee’s base wage on an hourly basis and then calculate the proper overtime wage. For instance, a non-management office worker makes $40,000 a year and works 40 hours a week. His hourly wage would be approximately $19.20 an hour ($40,000/52 weeks/40h a week). If he works 10 hours one day, he would be entitled to $28.80 for each overtime hour.
5) Can I bank overtime?
Yes. If an employee makes a written request, an employer can create a time bank and credit overtime wages for future time off. However, the time banked must be equal to the wage the employee would have been entitled to in working overtime. For example, if an employee works 10 hours in one day, they would be entitled to 3 hours of banked time (2 hours of overtime at 1.5x regular pay).
6) What is an averaging agreement?
The Employment Standards Act allows employers and employees to enter into “Averaging Agreements” that permit hours of work to be averaged over a period of up to four weeks. Employees may agree to a schedule where they work up to 12 hours in a day, without being paid overtime, provided that weekly averages do not exceed 40 hours a week. Unlike banked time, with an averaging agreement place there is no obligation to credit the employee overtime rates, provided that the employee takes time off within the time provided by the agreement. There are a number of technicalities not listed in this article which must be complied with in order for an averaging agreement to be enforceable. Please contact our office if you wish to introduce averaging agreements in your workplace.
7) I feel I’m owed overtime pay. What do I do?
If you feel you are owed overtime, the first step is to talk to your employer or put forward a written request. In fact, in most cases Employment Standards will require that you make attempts to resolve issues with your employer through the use of their Self-Help Kit.
If your employer refuses your request, you can file a complaint with Employment Standards. Employment Standards can conduct an investigation, offer mediation or hold a hearing regarding your complaint. Complaints must be filed within 6 months of the alleged offence.