If someone asked you to fulfill the requirements for paid statutory holidays, would you be able to tell? The entire process is essential. Yet, Yogi & Associates are here to keep you updated. So, join our team in Mississauga, and we will assist you in keeping your company running!
Statutory Holiday: A Brief Guide
1. Why Public Holiday is called Statutory Holiday?
A statutory holiday is a day off for your employees mandated by federal, territorial, or provincial law. A public holiday is so named because it enables you to pay your employees. You must pay them even if they are not at work that day. They still earn their basic pay plus whole holiday pay if they work on the holiday, even if they are paid for it.
2. List of Statutory Holidays:
Here is a list of statutory holidays:
- New Year’s Day (January 1st)
- Good Friday (April 15th)
- Victoria Day (May 23rd)
- Canada Day (July 1st)
- Labor Day (September 5th)
- National Day for Truth & Reconciliation (September 30th)
- Thanksgiving Day (October 10th)
- Remembrance Day (November 11th)
- Christmas Day (December 25th)
- Boxing Day (December 26th)
3. How does Statutory Holiday Work?
There’s no need to be concerned about when you’ll be paid as a Canadian employee. Statutory holidays are paid the same as other days off. When it comes to stat holidays, there may appear to be a lot of rules, but the truth is that employees are entitled to 5% of their salaries earned four weeks (28 days) before their holiday. This means that if you work on statutory holidays, you will still be paid whether or not you work on the holiday! However, if you are an hourly paid construction worker, like most laborers, you will receive 4% of your annual wage (overtime not included).
4. Three Reasons to Mark Upcoming Public Holidays:
The most effective way to manage the payroll system is to pay employees on time. Thus, the reasoning for calendar marking by Canadian businesses and payroll experts is as follows:
- To determine the employee holiday pay rate.
- Adjust their payroll system under the latest design if the payroll setup has changed.
- Should be aware of the dates for the employees’ holidays and vacations.
5. Five Basic Laws of Paid Statutory Holidays:
The statutory holiday rules of payroll are:
1. Paid General Holiday:
If workers have at least 30 days of employment the year before the holiday, they are eligible for paid time off.
2. Working on Public Holiday:
Employees who do their job on a holiday get a reward at 1.5 times their regular price on the next paid day off.
3. Holiday on Non-Regular Day:
Employees are not compensated if a public holiday falls on a non-regular working day.
4. Absent Before & After Public Holiday:
Your company will not compensate you for a statutory holiday if you miss working the day before or the day after.
5. Part-Time Employees:
The part-timers get paid for their work hours on statutory holidays.
6. How can you Calculate Statutory Holiday Pay?
Total wages earned divided by 20 x Average gross earnings per hour for each hour worked = Statutory Holiday Pay
1. First, you must understand your regular work week schedule.
2. Once you’ve assessed the structure of your company’s work week, look at the four previous work weeks that caused the public holiday week.
3. After that, add up all of the employee’s salaries (including vacation pay) for the four work weeks supporting the holiday and divide the total by 20. This will determine how much you must pay for the public holiday.
For example, John works from home for a corporation in another country. He has an annual income of $39,000. He works 37.5 hours each week and receives 4% in vacation pay. His pay for public holidays is:
|Wage per week||$39,000.00/52 weeks per year||= $750.00|
|Weekly pay plus paid vacation||$750 + 4%||= $780.00|
|Amounts received in the four weeks preceding the holiday.||$1,040.00 x 4||= $3,120.00|
|Divide total pay by 20||$3,120.00/20||= $156.00 (Public Holiday Pay)|
7. Qualified Workers for Paid Statutory Holiday:
You are suitable for a paid public holiday if:
- If it’s a typical day, you go to work even on a public holiday.
- You are at work on a holiday, which is not a usual workday.
8. Non-Qualified Workers for Paid Statutory Holiday:
An employer is not paid if:
- You do not work on a public holiday
- You skip work on your last day, the first day, or a public holiday without telling your employer.
To learn about the payroll process, you can look into one of our articles by clicking What is Payroll? A Guide for Setting Payroll in Canada.
9. Do Statutory Holidays Affect Pay Cheques?
If you qualify for a statutory holiday, it won’t affect your pay cheque. It’s crucial to remember that this can only happen if you have a “normal” pay rate, such as an income. So, if you qualify, your employer will calculate your day rate for the day you are eligible for statutory holiday pay. But if you have to work even on holiday and you still qualify for a statutory holiday, your employer should give you these benefits:
- They should pay you at least 1.5 times higher than your regular pay.
- Give up your right to vacation time.
- Give you a day off later at some time of your choice.
The Bottom Line:
On holiday, we set up a proper payroll system or administer payroll. But, as laws evolve, it becomes difficult to account for all situations. So, it will become more straightforward if you receive help setting up the payroll process. Thus, Yogi & Associates is here to help you! Our team will help you set up the payroll system according to your employees’ eligibility.
1. When is payday in Canada on a statutory holiday?
In particular, if your pay would normally be due on a statutory public holiday and your weekly or bi-weekly pay day falls on a Saturday or Sunday, it is usually assumed that the pay is moved to the previous business day, which is a Friday.
2. Are paychecks postponed due to holidays?
When bank holidays fall on payday, paychecks may be postponed. When there is a bank holiday between the period you run payroll and the pay date, bank transfer procedure is delayed.
3. What occurs if paychecks fall on a holiday?
It is common procedure for any company to pay its staff the day before a holiday. Payroll experts have a few options if payday falls on a bank holiday:
- Process payroll earlier.
- Pay employees on the holiday itself.
- Employees will be paid later.