Labour & Employment Law Blog

Employers Owe Vacation Pay on Commissions and Bonuses

Employers Owe Vacation Pay on Commissions and Bonuses

Sometimes an employer will calculate vacation pay based only on the employee’s salary rather than including the salary and any bonus or commission payments. This is important for the employee as sometimes bonuses and commission payments can make up a substantial part of the employee’s income. However, some jobs may be exempt from paying vacation with pay. Ontario’s Employment Standards Act, 2000 (“ESA”) sets out provisions with respect to how and in what amounts an employee is entitled to vacation pay.

To be clear, it does not matter how the employer pays the employee. The employer owes the employee vacation pay on all income including wages or salary, commissions or bonuses. This amount must be on top of the employee’s wages or salary, commissions or bonuses. Vacation pay cannot be calculated as an inclusive amount with respect to wages or income. For instance, an employee who works as a salesperson may make a certain commission as income based on the sales that they make. The employer would need to pay an amount in vacation pay in addition to the employee’s commission amounts.

It is common for employers to fail to pay vacation pay particularly on commissions or bonuses owed to the employee. Vacation pay must be at least 4% of the gross wages earned. Employees who have worked for at least 5 years of employment should be paid at least 6% of the gross wages earned. However, it does not matter how long an employee works with respect to vacation pay. The employee is still entitled to vacation pay the minute they start to work. It is only that the employee must complete the full entitlement year in order to qualify for vacation time (not pay) under the ESA.

Normally vacation pay is paid to the employee as a lump sum just before they actually take vacation time. However, there are two exceptions to this. The first is that if the employee takes less than one week’s vacation, the employee should be paid vacation pay the next time they are paid their regular wages. The second is that when the employee agrees in writing that the vacation pay will be paid on each paycheque. This means that the employee will be paid vacation pay each time they are paid their regular wages.

The employee is also owed any outstanding vacation pay owing to them when the employment ends. It does not matter that the employee was terminated. The employee is owed any vacation pay that they are entitled to that has not yet been paid by the employer. Finally, under the ESA an employer will owe vacation pay on statutory termination pay or notice but not on any severance pay owed.

The above article is for general information purposes only, does not constitute legal advice or create a solicitor-client relationship. Because each case is unique and factually driven, if you have concerns with regard to the foregoing issues, please make an appointment with one of our lawyers or a qualified legal practitioner elsewhere. We represent clients in the Greater Toronto Area including Toronto, North York, Markham, Vaughan, Thornhill, Newmarket, Aurora, Brampton, Mississauga, Barrie, Ajax, Whitby, Pickering and Oshawa.

Legal Receptionist

Zeilikman Law is an employment law firm located in Vaughan, Ontario. We are looking to hire a legal receptionist to join our firm. Preference will be given to candidates who have experience working as a receptionist at another law firm.

Location: Vaughan, Ontario.

Start Date: Immediately.

Hours: Monday to Friday, 9 am to 5 pm. Full time. In-person only. This is not a remote work position.

Wages: 35,000 to 40,000 per year.

Duties and Responsibilities:

  • Manage our firm’s multi-line telephone system to receive incoming calls.  Screen incoming telephone call inquiries to determine the nature of the telephone call and provide standard information related to our legal services.  Take and deliver messages and route incoming telephone calls to the appropriate staff person.
  • Answer general inquiries coming from the firm’s social media and website email.
  • Welcome in-person visitors upon arrival.  Direct visitors to the appropriate staff person and / or office or boardroom.
  • Organize in-person visitor schedule to prevent overlap and multiple bookings.
  • Receive, sort, and distribute daily mail and deliveries.
  • Arrange for couriers.
  • Keep front reception, kitchenette area and boardroom tidy.
  • Perform various clerical duties such as filing, photocopying, and faxing on an as-needed basis.
  • Process client or other payments.
  • May be asked to run minor errands outside of office such as attending post office to arrange a courier or pick up mail.
  • May be asked to assist other law clerks or lawyers of the firm as required and as appropriate.
  • Any other basic administrative duties or tasks as deemed appropriate.

Required Skills:

  • Basic knowledge of general office procedures including filing, faxing, and printing and copying.
  • Basic word processing computer skills.
  • Proficient in receptionist and telephone practices, etiquette, and decorum.
  • Professional attitude and appearance.
  • Excellent organizational skills.
  • Positive customer service attitude is a must.
  • Must be able to maintain confidential and sensitive information.

Education and Experience:

  • Highschool diploma or equivalent.
  • 1 – 2 years’ experience in an office setting with an emphasis in accounting, reception or clerical work is required.   We would prefer experience in a law firm environment.

Applications for this position should be sent via email to jennifer@zeilikmanlaw.com. All applications should include a cover letter, resume and at least two references. Only successful candidates will be contacted.