How Much Vacation Time and Pay Are Employees Entitled To?
What vacation time and vacation pay actually mean
Vacation time and vacation pay are two separate, related entitlements set out in employment standards legislation. Vacation time is the number of weeks off an employee earns each year. Vacation pay is a statutory percentage of the wages earned in the relevant period, paid to the employee in connection with that time off. Which rules apply depends on whether the employer is federally regulated (governed by the Canada Labour Code) or provincially regulated (governed by Ontario’s Employment Standards Act, 2000 or Alberta’s Employment Standards Code). Most employees in Ontario and Alberta fall under their province’s law, not the federal one, because federal coverage is limited to a specific category of employer.
Vacation time and pay by jurisdiction
| Jurisdiction | Years of service | Vacation time | Vacation pay |
|---|---|---|---|
| Federal | After 1 year | At least 2 weeks | At least 4% of wages |
| Federal | After 5 consecutive years, same employer | At least 3 weeks | At least 6% of wages |
| Federal | After 10 consecutive years | At least 4 weeks | At least 8% of wages |
| Ontario | Less than 5 years | At least 2 weeks per 12-month entitlement year | At least 4% of wages earned |
| Ontario | 5 years or more | At least 3 weeks | At least 6% of wages earned |
| Alberta | 2nd through 5th anniversary | At least 2 weeks | At least 4% of wages |
| Alberta | 7th anniversary and onward | At least 3 weeks | At least 6% of wages |
Sources: Canada Labour Code, RSC 1985, c L-2, ss 184, 184.01; Employment Standards Act, 2000, SO 2000, c 41, ss 33, 35; Employment Standards Code, RSA 2000, c E-9, ss 35, 40.
How the percentage is calculated
Vacation pay is not simply an employee’s regular salary continued during a week off. It is calculated as a percentage of the wages the employee earned during the period the vacation relates to. Federally, that percentage is 4% of wages in the applicable year of employment, rising to 6% after 5 consecutive years with the same employer and 8% after 10 consecutive years (Canada Labour Code, s 184.01). In Ontario, employees with less than 5 years of service must be paid at least 4% of wages earned as vacation pay, rising to at least 6% once they have 5 or more years of service (Employment Standards Act, 2000, s 33). In Alberta, an employee entitled to 2 weeks’ vacation must receive at least 4% of wages, and an employee entitled to 3 weeks’ vacation must receive at least 6% (Employment Standards Code, s 40).
When vacation time has to be taken
The three regimes differ in how directly they regulate scheduling. Alberta’s Employment Standards Code sets a firm outer limit: employers must give an employee their annual vacation in one unbroken period no later than 12 months after the employee becomes entitled to it (s 37(1)). The sources reviewed do not include an equivalent scheduling deadline for Ontario or federally regulated employers, so readers in those situations should check the applicable guidance or legislation directly for timing rules beyond the entitlement itself.
Why the federal/provincial distinction matters
Coverage under the Canada Labour Code is limited to employees of federally regulated employers, which is a narrower and different category from the general provincial workforce. Employees who work for a provincially regulated employer in Ontario or Alberta are governed entirely by their province’s Employment Standards Act, 2000 or Employment Standards Code, and the federal vacation figures in the table above simply do not apply to them. Confirming which regime covers a specific employer is the first step before relying on any of the numbers above.
Frequently asked questions
Does vacation entitlement increase the longer someone works for the same employer?
Yes, in all three regimes. Federally, entitlement rises from 2 weeks (after 1 year) to 3 weeks (after 5 consecutive years with the same employer) to 4 weeks (after 10 years) under the Canada Labour Code. In Ontario, most employees move from 2 weeks to 3 weeks after 5 years of service. In Alberta, the increase to 3 weeks happens on the 7th anniversary of employment.
What is vacation pay, and is it the same as regular wages?
Vacation pay is a statutory percentage of the wages an employee earned in the relevant period, not necessarily their regular paycheque during time off. The percentage rises with tenure: 4% up to 8% federally, 4% or 6% in Ontario depending on years of service, and 4% or 6% in Alberta depending on the vacation entitlement tier.
When does an Alberta employer have to schedule an employee's vacation?
In Alberta, employers must give an employee their annual vacation in one unbroken period no later than 12 months after the employee becomes entitled to it, under section 37(1) of the Employment Standards Code.
Why do federal vacation rules differ from Ontario's or Alberta's?
Federal rules under the Canada Labour Code apply only to employees of federally regulated employers, a distinct and much smaller category than the general workforce. Most employees in Ontario and Alberta are covered solely by their province's employment standards legislation, not the federal Code.
Sources
- Canada Labour Code, s 184 , Canada Labour Code, RSC 1985, c L-2, s 184 (retrieved February 10, 2026)
- Canada Labour Code, s 184.01 , Canada Labour Code, RSC 1985, c L-2, s 184.01 (retrieved February 10, 2026)
- Ontario.ca - Your guide to the Employment Standards Act: Small business , Employment Standards Act, 2000, SO 2000, c 41, ss 33, 35 (retrieved February 10, 2026)
- Alberta King's Printer - Employment Standards Code , Employment Standards Code, RSA 2000, c E-9, ss 35, 37(1), 40 (retrieved February 10, 2026)