Labour Day just passed, and we know you’re wondering how to handle statutory holiday pay for your employees. Whether you’re an employer striving for payroll accuracy or an employee curious about your pay, this guide is your go-to resource.

And hey, if you’re not in the mood for calculations, we’ve got you covered with our free online statutory holiday calculator. So, let’s get started!

What is Labour Day in Canada?

Labour Day is more than just a long weekend. It’s a statutory holiday recognized across Canada, celebrated on the first Monday of September. Employers have two primary responsibilities on this day:

  1. Allow employees to take the day off.
  2. Provide additional remuneration, known as “holiday pay.”

Statutory Holidays in Canada

Canada has several statutory holidays, including Labour Day.

For a full list and any updates, you can always refer to the official ESA guidelines, or check out our guide to holiday pay.

A PayEvo diagram of statutory holidays in Ontario, featuring Labour Day on September 4th of 2023.

Eligibility Criteria for Labour Day Pay

Just like with any other public holiday, eligibility for Labour Day pay depends on:

  1. Whether your industry is governed by the ESA or any special rules.
  2. The application of the “Last and First Rule” to the employee.

The “Last and First Rule” Unveiled

This rule states that an employee won’t qualify for public holiday pay if they, without justifiable cause, either:

  • Fail to work their entire last scheduled day before the public holiday.
  • Don’t work their whole first scheduled day after the public holiday.

Calculating Labour Day Pay

Calculating Labour Day pay is similar to other statutory holidays. You’ll need to sum all the wages earned by the employee in the four work weeks prior to the holiday and divide the total by 20. You can use our free online stat holiday calculator.

Vacation and Labour Day Pay

Vacation pay is included in the Labour Day pay calculation based on three scenarios:

  1. The employee receives vacation pay on every paycheck.
  2. The employee accumulates vacation pay and receives it when taking vacation.
  3. The employee accrues vacation pay and receives it as a lump sum on a specific day.

Labour Day during Vacation

If an employee is on vacation during Labour Day, they can either get a substitute day off or receive public holiday pay for that day, based on their agreement with the employer.

Canadian Labour Day Pay Example: Meet Emily

Alright, let’s dive into a real-world example to make this as clear as crystal. Meet Emily, a hard-working Canadian who earns $20 per hour and works a standard Monday-to-Friday week, putting in 40 hours each week.

Step 1: Calculate Total Wages for the Four Work Weeks

First, we need to calculate Emily’s total wages for the four work weeks leading up to Labour Day. Emily works 40 hours a week at $20 per hour, so her weekly wage would be:

40 * $20 = $800/week

For four weeks, her total wages would be:

$800 * 4 = $3200

Step 2: Divide by 20

The next step is to divide this total by 20, as per the statutory holiday pay calculation:

$3200 ÷ 20 = $160

Step 3: The Result

So, Emily would receive $160 as her Labour Day statutory holiday pay. This is in addition to her regular pay if she works on Labour Day, or it’s what she’d earn for the day if she takes it off.

And there you have it! Calculating Labour Day pay can be as straightforward as this example. If you’d rather skip the math, don’t forget you can always use our free online stat holiday calculator to do the job in a snap.

Hope this clears up any confusion! Whether you’re an Emily or an employer, understanding Labour Day pay is crucial for a compliant and stress-free holiday. Ready to calculate? Click here to use our free online stat holiday calculator today!

On PaymentEvolution’s Stat Holiday Calculator

Or instead, rather than stressing over manual calculations – let’s take a look at how PaymentEvolution’s Statutory Holiday Calculator can handle the math.

First, we navigate to the stat holiday calculator.

Then, we enter the province, holiday, and brief employment information for the employee.

Screenshot of the paymentevolution stat holiday calculator input screen where users input their province, holiday, and employee information.

After hitting continue, the calculator works with provincial-specific rules and the inputted information of the employee to generate the correct stat holiday payment.

screenshot of paymentevolution stat holiday calculator where the calculator shows the steps being taken: checking provincal laws, confirming hours worked/not worked, calculating stat holiday pay,compiling total gross owed.
Final screenshot of paymentevolution stat holiday calculator that shows the gross holiday pay that should be added to the pay run for the employee.

If you followed these steps to use the stat holiday calculator, follow these steps to add the calculation to your pay run.

Frequently Asked Questions

What is Labour Day Pay in Canada?

Labour Day pay is additional compensation employers are required to provide their employees on Labour Day.

Who is Eligible for Labour Day Pay?

Eligibility is determined by industry-specific rules and the “Last and First Rule.”

How is Labour Day Pay Calculated?

Use our free online stat holiday calculator for a quick and accurate calculation.

Stat Holiday Pay Wrapped Up

Navigating Labour Day pay doesn’t have to be complicated. With this guide and our free online stat holiday calculator, you’re all set for a compliant and happy Labour Day!

Ready to calculate? Use our free online stat holiday calculator today!

payevo stat holiday calculator coming soon to help calculate stat holiday pay ontario


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