Annual vacation goes a long way in improving workers’ productivity and helping to create work-life balance.
Annual vacation for federally regulated workplaces is covered by the Canada Labour Code. The Code is administered by Human Resources and Skills Development Canada’s Labour Program.
Code provisions are minimum standards only and do not interfere with additional rights or enhanced benefits established by collective agreements, private arrangements or employer policies.
The Canada Labour Code covers all employees and employers who work within the federal jurisdiction. This includes some of Canada’s major infrastructure sectors, such as interprovincial and international transportation (air, rail, ports and trucking), communications, banking and Crown corporations.
Federally regulated workers are entitled to at least two weeks of annual vacation with pay after each completed year of employment. After six consecutive years, workers are entitled to at least three weeks of annual vacation with pay.
Under the Code, vacation pay is set at 4 percent of a worker’s gross annual wage. However, if the worker is entitled to three weeks of vacation, the amount of vacation pay is equal to at least 6 percent of the gross annual wages.
Vacation is calculated as a percentage of the gross wages a worker earns during the "year of employment". The term "wages" includes every form of payment for work performed, but does not include tips and other gratuities.
Vacation pay is normally paid to the worker within the 14 days prior to the commencement of a vacation. However, vacation pay may be paid during or immediately following vacation, if that is the established practice in the worker’s workplace.
It is up to the employer to determine when a worker can take an annual vacation. However, a worker may, by written agreement with the employer, postpone or waive his or her entitlement to an annual vacation for a specified year of employment.
The Code also contains provisions for other types of leave from the workplace for qualifying federally regulated workers. These include:
Workers are also protected from dismissal, suspension, layoff, demotion or discipline because of an absence from work due to illness or injury, including instances that are work-related.
The Code contains provisions designed to support voluntary compliance, which the Labour Program promotes using a range of tools and techniques. If required, it responds to non-compliance situations through various voluntary and non-voluntary measures.
Holidays are an essential ingredient of diligent and productive work.