Vacation entitlement and vacation pay rate

A buyer meets this when working out what a target owes its staff at closing and what the staff carry over. The minimum rates and weeks are set in the statutes, so this entry points to them rather than quoting rates. See whether a buyer inherits employees’ years of service.

What the statutes say

• Ontario ESA s.33: a minimum vacation after each vacation entitlement year, with a longer minimum once the employee’s period of employment reaches five years. Section 35.2 sets the minimum vacation pay. This entry covers Ontario and federal law only; check the rules where you are.
• Ontario ESA s.9(1): if an employer sells a business and the purchaser employs an employee of the seller, employment with the seller is deemed to be employment with the purchaser for a later calculation of the employee’s length of employment. Subject to exceptions in section 9.
• Canada Labour Code ss.184 and 184.01: a vacation with vacation pay tied to years of employment with the same employer, except as otherwise provided by or under that Division of the Code.

What to ask

Ask for each employee’s start date, vacation taken and accrued vacation pay. Section 15.1 requires an Ontario employer to record an employee’s vacation time and vacation pay entitlement, so ask to see those records. Unpaid amounts can feed an order to pay.