One year contract and vacation

[Karoline Verdi]

#91602

Hi There,
I’m drafting a one-year contract for a new employee and contemplating how to address the issue of vacation time, specifically stating that she won’t be eligible to take any during this period.
Thank you

[Rick Tobin]

#91636

In Canada, vacation entitlements are governed by provincial or territorial employment standards legislation, and in some cases, by federal legislation for federally regulated industries. It’s crucial to adhere to the minimum standards set out by the applicable laws when drafting employment contracts, including those related to vacation time.

Here are some key points to consider when addressing vacation time in an employment contract, especially if contemplating a clause that restricts taking vacation during the first year of employment:

Minimum Entitlements: Each province and territory sets minimum vacation entitlements that employers must provide to employees. These entitlements typically accrue over time, often after a year of employment.

Legality of Restrictions: While employees typically accrue vacation time during their first year of employment, they may not be eligible to take this vacation until after the completion of the year, according to most employment standards. However, explicitly stating that an employee is not eligible to take any vacation time during the first year might conflict with statutory minimum standards, depending on the jurisdiction and how the contract is worded.

Accrual vs. Taking Vacation: It’s important to distinguish between accruing vacation time and the ability to take vacation time. Employees accrue vacation time during their first year but may only be allowed to take it after the year ends. This distinction should be clearly communicated in the contract to avoid misunderstandings.

Flexibility and Goodwill: Completely restricting vacation, even if legally permissible, might not be best for employee morale or health. Consider whether there might be flexibility for exceptional circumstances or earned days off.

Consult Legal Advice: Given the complexity of employment laws and the variations between jurisdictions, it’s advisable to consult with a legal professional who specializes in employment law in the relevant province or territory. This will help ensure that the contract complies with all legal requirements and protects both the employer and the employee’s rights.

In drafting the contract, you might consider a clause that explains how vacation time is accrued according to the provincial or territorial standards and specify any company policies regarding the scheduling of vacation time. Be sure to clarify that the employee will begin accruing vacation time upon commencement of employment but that the ability to take this vacation time may be subject to restrictions based on the standard practice within the jurisdiction and your specific organizational policies. Always ensure that these policies comply with the minimum legal standards.

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