Issues:
1-Can an employee elect to not take vacation and be paid?
One way or the other, most provinces will encourage or force the taking of vacation, so this is mainly a question when a company offers more than minimum standards or employees are paid on an hourly basis. The concept of 4% is primarily for hourly workers. It is also an issue when an employee on a fixed salary leaves or is terminated in the “middle” of a year.
Background:
1-The vacation year in Quebec starts on May 1st.(reference year). Payroll systems will delineate between amounts owed (based on vacation contractual obligations) Before May 1st (prior year) and after May 1st (current year). For instance if you go into the payroll system on July 1st, you would see an amount owing for the period before May 1st and from May 1st to June 30th.
2-You can prepay vacation, although that may be a bit more unusual.
3-Most payroll systems should allow a separate payment for vacation, thus ensuring that an employee does not change tax brackets. All remuneration will have some type of code/title. Most payments would have a title such as “regular hours”. In this case, the title is likely to be something like vacation bank hours. Upon full payment of the vacation bank, the company will no longer have any vacation (time or dollars) liability.
4-Most payroll software will have an area with statistics specific to vacation pay, vacation banks, leaves etc.
5-As previously indicated, unless contractually agreed to, an employee who is paid a fixed salary and takes their vacation will only be impacted by the 4% rule (or 6% in certain jurisdictions) if they leave the company.
7-Employers do have rights with (minimum notification) as to enforcing times of the year when vacation can be taken.
Beasley folders to create:
Documents related to vacation tracking
Documents related to vacation requests
