Do Employees on Infectious Disease Leave Accrue Vacation Pay? – Ask The Expert
Time spent on COVID-19 and infectious disease leave doesn’t count toward vacation pay unless the contract provides otherwise.
Are employees entitled to vacation pay while they’re on COVID-19 leave?
No, unless their employment contract provides more generous vacation pay terms than the jurisdiction’s employment standards act requires.
Under employment standards laws, employees accrue vacation pay for the time they actually work, typically 4% of wages over the first 5 years of employment and 6% after that. The time employees spend on leave doesn’t count as active work time for which vacation pay is accrued. This is true of not only COVID-19 leave (called infectious disease or public health emergency leave in some jurisdictions) but all other types of leave provided under the jurisdiction’s employment standards laws.
However, employment standards rules are minimum requirements and employers are entitled to provide more generous vacation pay. Accordingly, some employers do allow employees to accrue vacation pay while they’re on leave.
Bottom Line: Check the vacation pay terms of the employee’s collective agreement or individual employment contract. If it allows the employee to accrue vacation pay during COVID-19 leave, you must honour those terms; if it doesn’t say anything, the employment standards rule applies and you don’t have to count leave time as accrued employment time for purposes of calculating his/her vacation pay.