One of the many challenges in hiring globally is understanding the labor laws of each country. When hiring in Canada, you’ll need to navigate the various federal, provincial, and territorial laws that apply to everything from contracts to taxes, payments, and more.
Canada has a general set of federal overtime rules, but much of the country’s employment laws fall under regional jurisdiction. Responsible employers must follow the varying legalities of overtime payments set out by the ten provinces and three territories that make up Canada.
In this article, we’ll dive deeper into Canada's overtime laws and how they differ in each province or territory.
What Is Overtime in Canada?
The Canadian government defines overtime as any hours worked more than the standard hours of work, which are:
- 8 hours in a day (any period of 24 consecutive hours)
- 40 hours in a week (during the period between midnight on Saturday and midnight on the immediately following Saturday)
Working Monday to Friday from nine to five for 40 hours a week is highly typical, but isn’t universal. For example, the eight-hour workday rule does not work for Canadian truck drivers and their overtime is at the threshold of 60 hours per week.
The time and pay in Canada also differ across provinces and territories. What constitutes working overtime is based on the employment contract, industry norms, and local overtime rules and regulations.
With all these factors to consider, employers may wonder, what is the overtime rate in Canada? The overtime rate is a minimum of 1.5 times the employee's regular hourly wage. However, working overtime is much more than receiving 1.5 times your hourly wage.
Let’s further explore some of the many factors associated with working overtime.
Overtime Laws in Canada at a Glance
Working overtime in Canada isn’t just about paying your employees the extra 1.5 pay of their regular wage. Employers must ensure they comply with the federal and provincial laws pertaining to working overtime.
In Canada, overtime pay is regulated at both the federal and provincial levels. This is why, based on the specific requirements of the federal and provincial government, employers need to provide additional breaks, rest periods, and in many cases, time off for those working overtime.
Canada Labor Code
The Canada Labour Code (CLC) applies to federally regulated employees in the private and public sectors. A typical example is a bank employee whose employment relationship is governed under the CLC.
Other sectors include employees in the federal government, telecommunications, transportation, and traditional finance.
Of note, regulations surrounding fintech in Canada are more complicated, with proposed legislation coming into effect in the near future and some pending review. In the context of categorizing workers in this industry, they are not yet federally regulated employees.
In most cases, employees who work for organizations that aren’t federally regulated are under their respective provincial jurisdictions. At the same time, certain provincial legislation may apply to some federally regulated workplaces.
In either case, both levels of government have minimum standards in place for employment standards, and one is overtime.
For example, Ontario and British Columbia each have their own Employment Standards Act. Employers should be time-tracking for both salaried and hourly employees, as both are entitled to overtime pay if they have exceeded their standard hours. However, overtime doesn’t apply to certain occupations or individuals, such as those who are self-employed.
Overtime Hours and Pay
In Canada, the maximum allowable hours in a work week is 48 hours. In most regions, overtime employees are entitled to 1.5 times the regular hourly wage or paid time off, equivalent to 1.5 hours for every overtime hour worked. For example, when an employee works overtime for 5 hours, they receive 7.5 hours of time off with pay or 1.5 times their standard wages.
Some provinces use an averaging agreement to arrive at overtime rates for various jobs and occupations. Employees retain the right to refuse overtime work if they carry out family responsibilities related to the health and care of any family member or the education of any family member under 18.
Holidays and Time Off
Generally, employees who work on a statutory holiday receive 1.5 times their base rate, known as statutory pay. Although the rate is the same as regular overtime pay, it is considered to be premium pay and compensated at a corresponding rate.
Not all provinces and territories adopt the federally mandated general holidays. Only the following 5 statutory holidays: New Year’s Day, Good Friday, Canada Day, Labor Day, and Christmas Day — are mandated nationwide. Employees who work on these days get paid overtime or receive a day off.
In fact, if you are a provincially regulated business, then you do not need to observe every federal holiday. There are occasions where you do not need to pay your employees general stat pay or overtime wages.
Who Is Eligible for Overtime Pay?
In the US employees are classified as exempt and non-exempt about their wages and working in selected roles. In contrast, the general rule under the CLC in Canada is that managers, superintendents, and employees who truly carry out managerial functions are not subject to overtime pay. These managerial functions include but are not limited to tasks such as approving time-off requests and making budget-impacting business decisions.
Suppose a “manager” is performing non-manager/non-supervisory duties outside of managerial functions on a regular basis. In that case, their title alone does not categorize them into the role, meaning they are considered an employee and are thus entitled to overtime pay.
For example, a product manager in Ontario who has worked for 44 hours a week and whose duties are solely or primarily focused on the development of products and services from start to finish, but does not include budgeting or making strategic decisions, will be entitled to overtime pay.
However, there are differences in definitions of exempt vs. non-exempt employees by province/territory, and the CLC does not apply to each and every region. For example, Ontario classifies employees into these two categories, while in Nova Scotia, managers in the construction industry qualify for overtime pay.
A common misconception is that only hourly employees are entitled to overtime pay. This is not true. Salaried employees, apart from those mentioned above, who have been required by their employers to work over their standard hours in a week, are entitled to receive overtime pay.
Overtime and Pay by Province and Territory in Canada
Every province and territory in Canada has its own overtime laws. For example, Alberta has daily overtime requirements on top of their weekly ones. Meanwhile, the Northwest Territories do not mandate overtime to businesses where entire families work.
The specifications of working overtime vary based on where a business is located and what federal and provincial laws they are legally obligated to follow.
In Canada, there is a federal minimum wage. However, provinces have also established their own minimum wage rate. This is why you’ll notice a different minimum wage in each province or territory listed below.
Federal
- Overtime hours and pay: 1.5x after eight hours a day or 40 hours a week
- Minimum wage: CA $16.65 per hour
Alberta
- Overtime hours and pay: 1.5x after eight hours per day or 44 hours per week
- Minimum wage: CA $15.00 per hour; however, the minimum wage for students under 18 is CA $13.00 for the first 28 hours they work in a week. After 28 hours, the student must be paid CA $15 per hour.
- Examples of employees in occupations that do NOT qualify for overtime: Management, chartered accountants, licensed real estate agents, automobile salespeople, farm workers
- Region-specific statutory holidays adopted by province or territory: Alberta Family Day - Third Monday of February, Victoria Day - Last Monday before May 25, Thanksgiving Day - Second Monday in October, Remembrance Day - November 11
British Columbia
- Overtime hours and pay: 1.5x after eight hours, 2x after 12 hours (if calculated daily), 1.5x after 40 hours (if calculated weekly)
- Minimum wage: CA $15.65 per hour
- Examples of employees in occupations that do NOT qualify for overtime are management, teachers or instructors, police officers, firefighters, farm workers, fishers, commercial travelers, live-in home support
- Region-specific statutory holidays adopted by province or territory: British Columbia Day - First Monday in August, Family Day - Third Monday of February, Victoria Day - Last Monday before May 25, Thanksgiving Day - Second Monday in October, Remembrance Day - November 11
Manitoba
- Overtime hours and pay: 1.5x after eight hours/day or 40 hours/week
- Minimum wage: CA $15.30 per hour
- Examples of employees in occupations that do NOT qualify for overtime: Government employees, commissioned salespeople, businesses with all family members
- Region-specific statutory holiday adopted by province or territory: Louis Riel Day - Third Monday of February, Victoria Day - Last Monday before May 25, Thanksgiving Day - Second Monday in October
New Brunswick
- Overtime hours and pay: $20.63 (or more) + 1.5x after 44 hours/week
- Minimum wage: CA $14.75 per hour
- Examples of employees in occupations that do NOT qualify for overtime: Government employees, commissioned salespeople, businesses with all family members
- Region-specific statutory holiday adopted by province or territory: Family Day - Third Monday of February, Victoria Day - Last Monday before May 25, New Brunswick Day - First Monday in August, Thanksgiving Day - Second Monday in October, Remembrance Day - November 11, Boxing Day - December 26
Newfoundland and Labrador
- Overtime hours and pay: CA $21.75 (or more) after 40 hours/week
- Minimum wage: CA $15.00 per hour
- Examples of employees in occupations that do NOT qualify for overtime: Farmworkers, domestics
- Region-specific statutory holiday adopted by province or territory: Newfoundland and Labrador observes Memorial Day on July 1 instead of Canada Day, Remembrance Day - November 11
Nova Scotia
- Overtime hours and pay: 1.5x after 48 hours/week
- Minimum wage: CA $15.00 per hour
- Examples of employees in occupations that do NOT qualify for overtime are management, farm workers
- Region-specific statutory holiday adopted by province or territory: Nova Scotia Heritage Day - Third Monday of February
Nunavut
- Overtime hours and pay: 1.5x after eight hours/day or 40 hours/week
- Minimum wage: CA $16.00 per hour
- Examples of employees in occupations that do NOT qualify for overtime: management
- Region-specific statutory holiday adopted by province or territory: Victoria Day - Last Monday before May 25, Nunavut Day - July 9, 1st Monday in August - First Monday in August, Thanksgiving Day - Second Monday in October, Remembrance Day - November 11
Northwest Territories
- Overtime hours and pay: 1.5x after eight hours/day or 40 hours/week
- Minimum wage: CA $16.05 per hour
- Examples of employees in occupations that do NOT qualify for overtime: Government employees, commissioned salespeople, businesses with all family members
- Region-specific statutory holiday adopted by province or territory: Victoria Day - Last Monday before May 25, National Indigenous Peoples Day - June 21, 1st Monday in August - First Monday in August, Thanksgiving Day - Second Monday in October, Remembrance Day - November 11
Ontario
- Overtime hours and pay: 1.5x after 44 hours/week
- Minimum wage: CA $16.55 per hour; however, the minimum wage for students is CA $15.60 per hour.
- Examples of employees in occupations that do NOT qualify for overtime: Management and teachers
- Region-specific statutory holiday adopted by province or territory: Family Day - Third Monday of February, Victoria Day - Last Monday before May 25, Thanksgiving Day - Second Monday in October, Boxing Day - December 26
Prince Edward Island
- Overtime hours and pay: 1.5x after 48 hours/week
- Minimum wage: CA $15.00 per hour
- Examples of employees in occupations that do NOT qualify for overtime are truck drivers, ambulance drivers, fish processors
- Region-specific statutory holiday adopted by province or territory: Islander Day - Third Monday of February, Remembrance Day - November 11
Quebec
- Overtime Hours and Pay: 1.5x after 40 hours/week
- Minimum Wage: CA $15.25 per hour
- Examples of employees in occupations that do NOT qualify for overtime are management, students, farm workers, fish processors
- Region-specific statutory holiday adopted by province or territory: Good Friday or Easter Monday (decided by employer) - Friday before Easter Sunday or Monday after Easter, National Patriots’ Day - Last Monday before May 25, Quebec National Holiday - June 24, Thanksgiving - Second Monday in October
Saskatchewan
- Overtime Hours and Pay: 1.5x after eight or ten hours/day or 40 hours/week
- Minimum Wage: CA $14.00 per hour; CA $15.00 per hour as of October 1, 2024
- Examples of employees in occupations that do NOT qualify for overtime: Management, teachers, commission sales persons
- Region-specific statutory holiday adopted by province or territory: Family Day - Third Monday of February, Victoria Day - Last Monday before May 25, Saskatchewan Day - First Monday in August, Thanksgiving Day - Second Monday in October, Remembrance Day - November 11
Yukon
- Overtime Hours and Pay: 1.5x after eight hours/day or 40 hours/week
- Minimum Wage: CA $16.77 per hour
- Examples of employees in occupations that do NOT qualify for overtime: Government employees, commissioned salespeople, businesses with all family members
- Region-specific statutory holiday adopted by province or territory: Victoria Day - Last Monday before May 25, National Indigenous Peoples Day - June 21, Discovery Day - Third Monday in August, Thanksgiving Day - Second Monday in October, Remembrance Day - November 11
Canada Overtime Laws – A (Dis)Advantage
There are both advantages and disadvantages to working overtime. While employees can earn more, their overtime compensation can certainly affect their tax brackets. And while employers gain incremental productivity from willing employees, they are still increasing their expenditure and this is evident when calculating overtime pay.
Understanding overtime regulations is a crucial aspect of paying and receiving overtime pay for employers looking to stay compliant and employees looking to understand their rights.
Borderless, the One-Stop-Shop for Staying Compliant
An Employer of Record (EOR) such as Borderless is here to make things easier by ensuring that employees are within their rights and that employers are compliant with overtime work and pay, wherever they are hired.
Find talent fast, hire quickly, and onboard seamlessly in 170+ countries around the world. Whether you need someone to assist with onboarding and managing your Canadian hires or to calculate overtime pay for your international team, our all-in-one platform is all you need to fulfill all your global hiring needs.
Disclaimer: Borderless does not provide legal services or legal advice to anyone. This includes customers, contractors, employees, partners, and the general public. We are not lawyers or paralegals. Please read our full disclaimer here.
