A fixed salary compensates an employee for all non-overtime hours up to and including 44 hours a week. After 44 hours, the employee is entitled to overtime pay. His salary is adjusted for weeks in which he works either more hours or fewer hours. In this case, Ben is actually receiving a wage based on the number of hours he works.
This week, he worked 50 hours. Antonio worked overtime in a week with a public holiday, but he did not work on the holiday.
This week Antonio worked the following hours:. Etsuko and her employer agreed in writing that she would work on the public holiday and she would be paid premium pay for the hours she worked on the holiday plus public holiday pay. Since Etsuko received premium pay for working nine hours on the public holiday, these hours are not included when the overtime pay is calculated:.
Kathleen and her employer agreed electronically that she would work on the public holiday and she would receive a substitute day off work with public holiday pay plus her regular rate for hours worked on the public holiday rather than be paid public holiday pay plus premium pay for the hours she worked on the holiday. Since Kathleen agreed not to receive premium pay for the nine hours she worked on the public holiday, these hours are counted when the overtime pay is calculated:.
Kathleen will also get a substitute day off work with public holiday pay within three months of the public holiday or, if Kathleen and her employer agree electronically or in writing, within twelve months of the public holiday. These employees must be paid at least the minimum wage for all the hours they work. They are also usually entitled to overtime if they work more than 44 hours a week. Becka is paid on a piecework basis. Rhian earns straight commissions.
Note: Some commission employees are exempt from the overtime provisions. Sometimes employees need to work variable hours to meet family responsibilities. Instead the employee would like to work extra hours in the preceding weeks, to make up the time. Likewise, employers may need employees to work extra hours during a peak period, in order to fill customer orders.
While averaging agreements offer employers some flexibility when it comes to Ontario overtime pay, the following types of agreements are not allowed under the ESA:. Because if you skirt the rules and an employee files a complaint with the ESA, you could find yourself and your business in hot water. Become a Partner Partner Resource.
Request Demo Start my free trial Login. Blog Payroll Management. Payroll Management. Agreements for Paid Time Off Depending on the type of work, some employees may agree to receive paid time off work instead of overtime pay.
Calculating Overtime Pay By this point, you probably have a pretty good idea of whether your employee should receive overtime pay and how much they are entitled to. Hourly Employees Calculating overtime pay for hourly employees is fairly straightforward. Calculating Overtime for Averaging Agreements Calculating overtime for averaging agreements is more straightforward than it seems.
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An averaging agreement must meet certain requirements. An employee and an employer can agree electronically or in writing that the employee will receive paid time off work instead of overtime pay.
This is sometimes called "banked" time or "time off in lieu. Paid time off must be taken within three months of the week in which the overtime was earned or, if the employee agrees electronically or in writing, it can be taken within 12 months.
If an employee's job ends before he or she has taken the paid time off, the employee must be paid for all unused banked time. This must be paid no later than seven days after the date the employment ended or on what would have been the employee's next pay day.
Content last reviewed: April What is the basic overtime rule? Does everyone get overtime pay? But salaried employees must be exempt? But highly paid employees must be exempt? But what if the employee agreed not to get overtime when hired? Do I count everything when calculating overtime hours? Can I provide lieu-time instead of overtime pay? After reading this, I think I owe overtime. What do I do? Good question.
Where do I get more information about overtime obligations? Share Share this post to twitter Share this post to linkedin Share this post to facebook Share this post to email. About Mary Lou Brady. Receive Blog Posts By subscribing to our blog, you will receive an email when a new post is added.
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