Overtime pay can be challenging and confusing, especially when an employee is not paid based on an hourly wage.
Ontarios Employment Standards Act, 2000, Part VIII, sets out when an employee is entitled to overtime pay and the rate that is payable to the employee.
Employers who do not follow the overtime rules can be exposed to significant liability claims by employees, particularly if the problem is wide-spread throughout the employers business.
Recent cases in Ontario clearly indicate that employers run the risk of paying significant damages to employees if overtime is not paid properly to employees.
A good example is Baroch v. Canada Cartage, an Ontario class action that has been certified by the Ontario Court. In this case, 7,800 employees (of this trucking/transportation business) claim that their employer systematically failed to properly pay overtime to employees over several years (when the employees worked more than the threshold set out by the Employment Standards Act, 2000).
The Baroch case also makes it very clear, based on the Courts initial treatment of the case, that employers must:
1. have a written overtime policy;
2. give clear directions in the workplace for employees to know how to apply the overtime rules and the thresholds; and
3. implement a good system internally to track working hours for employees in order to identify and properly calculate overtime pay and entitlement.
The employer in Baroch did not have these in place this had a significant impact on the Courts decision to allow the case against it to proceed. Had the employer done these things properly, it likely would not have needed to face what will be a very substantial damages payment to its employees, plus very significant legal expenses.
This WARDS PC BLAWG is for general information only. It is not legal advice, or intended to be. Specific or more information may be necessary before advice could be provided for your circumstances.