Vacation time is one of the most valued employment benefits in Ontario. It provides employees with much-needed rest, helps prevent burnout, and promotes a healthy work-life balance. However, questions often arise about the extent of control employers have over vacation timing. Can your employer deny your vacation request? Can they force you to take time off during slow periods? The answers lie in a careful reading of Ontario’s Employment Standards Act, 2000 (ESA) and, in some cases, the terms of your employment contract or collective agreement.

This blog will examine the rules governing vacation entitlements, employer rights and responsibilities, and employee protections related to scheduling and taking vacation time in Ontario.

Minimum Vacation Entitlements Under the ESA

In Ontario, the ESA provides the legal framework for minimum vacation entitlements. Most employees are entitled to:

• Two weeks of vacation time per year after each 12-month vacation entitlement year, if they have been employed for less than five years.
• Three weeks of vacation time per year after five years of employment with the same employer.

In addition to vacation time, employees are entitled to vacation pay, typically 4 per cent of gross wages for employees with less than five years of service and 6 per cent for those with more than five years. The ESA mandates that vacation pay be paid either in a lump sum before the vacation begins or as part of each paycheque, depending on the employer’s policy and any agreement with the employee.

These are minimum standards. Some employers offer more generous vacation entitlements, and unionized workers may be covered by collective agreements that provide for greater benefits.

Can an Employer Deny Your Requested Vacation Time?

While employees are entitled to vacation time, the ESA does not give them an absolute right to choose when they take it. Employers retain the right to manage their business operations and to approve or deny vacation requests based on business needs. This means that if an employee submits a vacation request for a particular week, the employer can deny that request if it would cause operational disruption, if others have already been approved for the same time, or if there are other legitimate business reasons.

However, an employer cannot refuse vacation altogether. The ESA requires that employers ensure vacation time is taken within 10 months of the end of the vacation entitlement year. In other words, while your employer can say “not this week,” they cannot say “not at all.”

It is also important to note that if an employer denies a vacation request, they must be acting in good faith and not for discriminatory or retaliatory reasons. Denying vacation time because an employee made a complaint or exercised a workplace right could be considered a reprisal under the ESA or the Ontario Human Rights Code.

Can an Employer Force You to Take Vacation?

Interestingly, the ESA also allows employers to schedule vacation time for employees, even if the employee does not wish to take a vacation at that time. Employers may require employees to take a vacation during a company-wide shutdown or slow season, such as over the winter holidays or during a planned maintenance period. Provided the employee receives the appropriate amount of vacation time and pay, this is legally permissible.

That said, the vacation must still be scheduled in a block of one or two weeks unless the employee agrees to take it in shorter periods. For example, an employer cannot assign a vacation day here and there without the employee’s agreement unless the vacation time still amounts to a full week or two.

Employers should also be mindful of fairness and consistency when scheduling mandatory vacation. Applying different rules to different employees could raise concerns of discrimination or unfair treatment, particularly if the distinctions are not based on objective business needs.

Vacation Scheduling Policies and Employment Contracts

Many employers have written policies or employment contracts that set out how vacation is requested and approved. These policies might require employees to provide a certain amount of notice or to coordinate with others on their team. In unionized workplaces, collective agreements often include detailed provisions about how vacation is to be scheduled and how conflicts between employee requests will be resolved.

Where such policies exist, both employers and employees are expected to follow them in good faith. However, a policy cannot override the minimum standards of the ESA. For instance, an employer cannot implement a policy that denies vacation time altogether or that reduces the minimum vacation pay entitlement.

If a dispute arises over how a policy is applied, the outcome will depend on the specific language of the policy, any applicable collective agreement, and whether the employer has applied it consistently and fairly.

Vacation and Termination of Employment

Another common point of confusion is what happens to vacation entitlement upon termination of employment. Under the ESA, when an employment relationship ends, whether due to resignation or termination, the employer must pay out any accrued but unused vacation pay. This amount is calculated based on the employee’s wages during the period when the vacation was earned, not at the time of termination.

If an employee is terminated partway through the vacation entitlement year, they are entitled to a pro-rated amount of vacation pay for the period worked. Employers are not permitted to withhold this pay, even if the employee did not request or use their vacation time.

It is also worth noting that an employer cannot force an employee to use up their vacation time during the notice period unless both parties agree to this arrangement. Otherwise, vacation pay must be paid out in addition to any termination or severance pay that may be applicable.

What Happens If Vacation Rights Are Denied or Misused?

If an employer denies an employee their ESA-mandated vacation time or fails to provide vacation pay, the employee has several options. First, the employee can raise the issue with their employer or HR department, ideally in writing. If the matter is not resolved internally, the employee may file a complaint with the Ontario Ministry of Labour, which enforces the ESA.

In some cases, it may be appropriate to seek legal advice. For example, suppose vacation denial appears to be tied to discriminatory reasons or is part of a broader pattern of reprisal or constructive dismissal. In that case, the matter may be more complex than a simple ESA violation.

Employees also have the right to sue their employer in civil court for unpaid vacation pay. However, this is more common in cases involving larger unpaid sums or additional claims such as wrongful dismissal.

Best Practices for Employers and Employees

To avoid misunderstandings and disputes about vacation rights, both employers and employees benefit from clear communication and proactive planning. Employers should:

• Develop written vacation policies that comply with the ESA.
• Apply policies consistently and fairly across the organization.
• Schedule vacation well in advance where possible and consult with employees before mandating time off.
• Ensure vacation pay is calculated and paid correctly, including upon termination.

Employees, in turn, should:

• Request vacation as early as possible, especially during popular times like summer or holidays.
• Familiarize themselves with workplace policies or collective agreements.
• Keep written records of vacation requests and approvals.
• Speak up if they believe their rights under the ESA are being violated.

Striking a Balance Between Business Needs and Employee Rights

The right to vacation time is protected by law in Ontario, but it is not absolute in terms of timing. Employers have the right to deny specific vacation requests or require employees to take vacation at certain times, provided they remain within the legal framework of the ESA and act in good faith.

Employees who understand their vacation entitlements and maintain open lines of communication with their employer are better positioned to plan time off effectively and assert their rights when necessary. For employers, clear policies and consistent application of the law help prevent conflict and ensure compliance.

Contact Haynes Law Firm in Toronto for Employee Vacation Matters

If you have questions about your vacation rights or are experiencing problems with vacation pay or scheduling, contact the experienced employment lawyers at Haynes Law Firm in Toronto. We tailor our approach to your specific situation to help you resolve disputes and protect your workplace rights. For a consultant, please reach out by phone at 416-593-2731 or online.