Holiday Pay Formula Change– Reverts to Pre-Bill 148 Formula
Bill 148, “The Fair Workplace, Better Jobs Act, 2017” instituted many different changes to the Employment Standards Act and other legislation in Ontario. One of the changes enacted on January 1, 2018 was the implementation of a new Public Holiday Pay Formula.
The initial changes required Employers to adjust their Public Holiday Pay Policies as well as Payroll processes and systems to incorporate the new equation for determining holiday pay for part-time and casual staff. The new calculation created scenarios where a part-time or casual employee could be entitled to the same amount of public holiday pay as a full-time employee. This created a significant expense for employers and created a disincentive to engage part-time or casual employees due to increased labour costs.
The government has responded to the feedback from employers and decided to revert back to the original Public Holiday Pay Formula effective July 1, 2018. The government has also announced that it will undertake a review of public holiday rules.
Below is the Public Holiday Pay Formula that applied prior to The Fair Workplace, Better Jobs Act, 2017 and will be in effect as of July 1, 2018:
Holiday Pay Calculation – July 1, 2018
- The total amount of regular wages earned, and vacation pay payable to employee in four (4) week period before the work week in which the public holiday occurred, divided by 20
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