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Key Topics in the BC Employment Standards Act

Richard B. Johnson

Co-Founder + Partner
October 18, 2021

The BC Employment Standards Act sets the standard for many non-unionized working relationships in the province.

The Act doesn’t govern every detail of your employment contract or your relationship with your employer, rather it sets the minimum expectations for relationships between workers and employers, defining standards for things like minimum wage, severance pay, medical leave, overtime and vacation pay. The Act also covers some more administrative rights that employees sometimes take for granted, like getting paid every two weeks, getting a detailed pay slip, and not having to pay for business expenses.

Employers are free to go above and beyond what is defined in the Act, but they can’t go below that minimum. 

Who Does the Act Cover?

The Employment Standards Act covers non-unionized workers. Professionals like doctors, lawyers, and engineers are exempt from the act, but that’s because these are highly secure, well-paid professions. Doctors don’t really need the protections offered by the Act, and in highly skilled professions like this, things like overtime and stat pay don’t necessarily apply. 

End of Employment Rights

The Employment Standards Act sets the minimum for what an employee is entitled to in terms of notice, or pay in lieu of notice, upon being let go (except in cases of just cause dismissal).

The amount of pay or notice that an employee is entitled to is proportionate to how long the employee has been working at the organization. In general, an employee’s first 3 months at a job are considered a probationary period, during which that employee can be let go without any notice or pay under the Act. 

If an employee has been with the company for more than 3 months, they are entitled to one week of notice and/or pay upon termination. More than 1 year, they’re entitled to two weeks. For employees that have been working with the organization in excess of 3 years, the rule is one week of notice or pay for every year of service, up to 8 years (or eight weeks). 

Employers can’t legally provide less notice or pay than what is defined in the Act when terminating an employee. 

Overtime Rights

At Ascent we get a lot of questions about overtime rights. The general rule applies to all non-unionized, provincially regulated employees, and the basic overtime calculation is as follows: 

Any working hours that exceed 40 hours in a week or 8 hours in a day are paid out at time-and-a-half — that is, 1.5 times the employee’s regular wages. Any hours over 12 in a single day are paid out at double the employee’s regular wages. Daily and weekly overtime are considered separate — if you work more than 8 hours in a day, you are entitled to overtime even if you worked less than 40 hours total during that week. Likewise, if you work more than 40 hours in a single week, you get overtime even if you never exceeded 8 hours on a given day in that week. That said, daily and weekly overtime can’t be compounded — if you worked 42 hours in a week (8 hours on Monday through Thursday and 10 hours on Friday) you are only paid time and a half for 2 hours — not 4.

Overtime Exemptions

There are a lot of exceptions to who is entitled to overtime. Highly skilled professionals like lawyers, doctors, accountants, and engineers are exempt. The ESA also exempts managers from overtime, but there are restrictions for who can be considered a manager. We sometimes see employers trying to avoid paying overtime by giving employees job titles with the word “manager” in them, or by paying people a “manager’s salary”. Neither your pay, nor your title have any bearing on whether or not you are exempt from overtime.

In order to be exempt from overtime as a manager, your primary job responsibilities must involve managing either people, or company resources. Actual managerial duties might include:

  • Conducting performance reviews

  • Hiring

  • Calling people into work

  • Approving vacation time, raises, or promotions

  • Approving expenses or allocating finances

  • Managing or maintaining company infrastructure

It’s important to note that you don’t necessarily have to oversee people to be a manager. For example, an IT manager could be a legitimate manager, even if they don’t work directly with any other employees. The IT manager in this case would be a true manager because they oversee all of the infrastructure and technology for an organization, and they make key decisions about how to use those company resources and budgets.

We also see confusion arise with overtime calculations for employees whose pay is not always consistent or predictable. It’s very easy to calculate overtime for someone who is paid hourly. But people on salary or those with flexible schedules are still entitled to overtime. 

Calculating overtime for a salaried employee is simple — just divide their salary by the number of weeks they work in a year, then by the number of hours they work in a week. 

Vacation Pay

Vacation pay is also a common point of confusion for employers. In this case, for salary workers vacation pay is easy to calculate. An employee’s annual salary, divided by 52 weeks, times the number of weeks of vacation that employee is entitled to, equals the amount of vacation pay.

For people who work on commission it can be a little trickier. But again, this does not exempt commission workers from vacation pay. The Act actually makes this a very simple calculation. According to the ESA, workers are entitled to vacation pay equaling 2 percent of your annual salary per week of vacation. So if you’re entitled to 2 weeks of vacation, you’re entitled to 4 percent vacation pay. If you have 5 weeks of vacation, that’s 10 percent vacation pay. And so on.

Contractual Rights

Another area where we see a lot of confusion is with contractors — in particular, who is considered an independent contractor and who is considered an employee in the eyes of the Employment Standards Act. Contractors are technically self-employed, but we see many cases where employers label people contractors to avoid having to, for example, pay overtime or offer vacation, while treating these “contractors” very much like employees. 

The Act, being designed to protect vulnerable workers, is pretty clear on this. If your relationship looks like an employment relationship, regardless of a person’s title, the Act will still consider that “contractor” to be an employee, with all the rights of an employee. 

Just as your job title has little to do with whether or not you are a manager, your written agreement as a contractor is less important than the nature of your working relationship when determining your rights under the Act. In general, a true contractor is going to have a greater degree of autonomy than an employee. This isn’t just in terms of scheduling, but it’s also in terms of access to equipment, responsibilities, and the nature of the relationship.   

Employers tend to be supervised to a greater degree. The employer or supervisor may assign the specific daily or weekly tasks. The employer will also likely provide equipment, including a desk, office chair, or computer. If, for example, you work as a contractor in an office, but your job looks virtually identical to your coworkers who are employees, then there is a high likelihood that you will be considered an employee in the eyes of the Employment Standards branch. Even in jobs with more flexibility, you may be entitled to more of the Act’s protections than you think. 

If you are owed severance, wages, or overtime pay from your employer, you can file a complaint with the Employment Standards branch within 6 months of the initial incident. That said, the Employment Standards branch does get very busy, and it can take a while to hear back about a claim. If you have another concern, such as an issue with discrimination in the workplace or an unsafe work environment, we recommend exploring other avenues — for example, if you are being bullied at work, you may be better served filing a complaint with the BC Human Rights Tribunal. 

If you have questions or concerns about your employment, about the protections of the Employment Standards Act, or about how to best seek compensation for a workplace issue, we encourage you to book a one-hour consultation with one of our legal professionals.