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Overtime pay

Overtime pay is a right, not a perk. If you're working enough hours to earn overtime, you should know the basics and be sure that you're getting paid correctly.


Table of Contents
  1. When do I get overtime pay?
  2. Are there exceptions?
  3. Is there overtime pay for working longer daily hours?
  4. How is overtime pay calculated?
  5. Are other employees also entitled to overtime pay?
  6. Can employees take time off instead of overtime pay?
  7. What is an "averaging agreement"?
  8. Do I get overtime pay for working Sundays or for working late at night?
  9. Am I still entitled to overtime pay if I agree to work longer hours?
  10. What if I think my employer is not following the ESA?
  11. Can I see the ESA?

When do I get overtime pay? Top

For most employees, overtime begins after they have worked 44 hours in a work week. After that time, they must receive overtime pay or, if they agree in writing, time off in lieu of overtime pay.

Are there exceptions? Top

Some employees have jobs that are exempt from the overtime provisions of the ESA. Others work in jobs where the overtime threshold is more than 44 hours in a work week. See Is my job covered? for more details.

For example, managers and supervisors don't qualify for overtime pay if the regular work they do is managerial or supervisory. Even if they perform tasks that aren't managerial or supervisory, they don't get overtime pay if these tasks are performed only on an irregular or exceptional basis.

Is there overtime pay for working longer daily hours? Top

No, unless a contract of employment or a collective agreement states otherwise. Under the ESA, an employee doesn't earn overtime pay on a daily basis by working more than a set number of hours a day. Overtime is calculated only:

on a weekly basis

OR

over a longer period under an averaging agreement (see "averaging agreements" below).

How is overtime pay calculated? Top

Overtime pay is 1½ times your regular rate of pay. This is called "time and a half".

Suppose your regular rate of pay is $10.00 an hour. If you work more than 44 hours in a work week, your overtime rate is:

$10.00 X 1½ = $15.00 an hour for every hour worked after 44 in that work week.

An employer can't lower your regular wage to avoid paying time and a half after 44 hours (or other overtime threshold that applies) in a work week. For example, if Josée's regular pay is $12.00 an hour, her employer can't drop her regular rate to $10.00 an hour and then pay her 1½ times $10.00 for overtime hours worked.

The following four examples show how to calculate overtime pay for employees who are paid on an hourly basis:

1. When an employee works overtime in a work week:

Ravi's regular pay is $10.00 an hour. His overtime rate (1½ X regular hourly pay) is $15.00 an hour. This week Ravi worked the following hours:

Day Hours Ravi Worked
Sunday0
Monday8
Tuesday12
Wednesday9
Thursday8
Friday8
Saturday8
Total hours:53

Any hours worked over 44 in a week are overtime hours. Ravi worked nine overtime hours (53 - 44 = 9). Ravi's pay for the week is calculated as follows:

Regular pay: 44 X $ 10.00= $440.00
Overtime pay: 9 X $15.00= 135.00
Total pay:$ 575.00


2. When an employee's work week includes a public holiday:

John's regular pay is $10.00 an hour. John worked overtime in a week with a public holiday, but he didn't work on the holiday. Assume his public holiday pay for the holiday is $80.00. This week John worked the following hours:

DayHours John Worked
Sunday0
Monday (public holiday)0
Tuesday12
Wednesday9
Thursday8
Friday8
Saturday8
Total hours:45

John worked one hour of overtime (45 - 44 = 1). John's pay for the week is calculated as follows:

Regular pay: 44 X $ 10.00= $440.00
Overtime pay: 1 X $15.00= 15.00
Public holiday pay:= 80.00
Total pay:$ 535.00


3. When an employee works on a public holiday and gets premium pay

Suppose an employee works on a public holiday and receives premium pay for hours he or she worked on that day. In this case, the hours the employee is paid at the premium rate aren't counted toward hours of work when the overtime is calculated. (See "Public Holiday Pay" for details about receiving premium pay for working on a public holiday.)

Marylin's regular hourly pay is $10.00. Marylin and her employer agreed in writing that:

  • she would work on the public holiday AND
  • she would be paid premium pay for the hours she worked on the public holiday, plus public holiday pay.

During the week of the public holiday, Marylin worked the following hours:

DayHours Marylin Worked
Sunday0
Monday9
Tuesday9
Wednesday9
Thursday (public holiday)9
Friday9
Saturday9
Total hours:54

Since Marylin received premium pay for working nine hours on the public holiday, these hours aren't included when the overtime pay is calculated:

54 hours - 9 hours at premium pay = 45 hours - 44 hours (regular work week) = 1 overtime hour

Marylin's pay for the week is calculated as follows:

Regular pay: 44 X $ 10.00= $440.00
Overtime pay: 1 X $15.00= 15.00
Premium pay: 9 X $15.00= 135.00
Public holiday pay:= 90.00
Total pay:$ 680.00


4. When an employee works on a public holiday and gets a substitute day off

Kathleen's regular hourly pay is $10.00. Kathleen and her employer agreed in writing that:

  • she would work on the public holiday.
  • she would receive a substitute day off work with public holiday pay, plus her regular rate for hours worked on the public holiday. (See "Public Holiday Pay" for details about working on a public holiday and receiving a substitute day off.)

During the week of the public holiday, Kathleen worked the following hours:

DayHours Kathleen Worked
Sunday0
Monday9
Tuesday9
Wednesday8
Thursday (public holiday)9
Friday9
Saturday6
Total hours:50

Since Kathleen agreed not to receive premium pay for the nine hours she worked on the public holiday, these hours are counted when the overtime pay is calculated:

50 hours - 44 hours = 6 overtime hours

Kathleen's pay for the week is calculated as follows:

Regular pay: 44 X $ 10.00= $440.00
Overtime pay: 6 X $15.00= 90.00
Total pay:$ 530.00

Kathleen will also get a substitute day off work with public holiday pay within three months of the public holiday, or within 12 months if she agrees in writing.

Are other employees also entitled to overtime pay? Top

Employees whose pay is not based on an hourly rate are entitled to overtime pay when they work more than 44 hours in a work week. This is true for:

  • Employees on a fixed salary:

    If an employee's hours of work change from day to day, but his or her weekly pay stays the same, the employee is paid a "fixed salary". For example, if you work 44 hours one week and 42 hours the next, but receive the same pay each week, you are on a fixed salary.

    A fixed salary compensates an employee for all non-overtime hours up to and including 44 hours in a work week. After 44 hours, the employee is entitled to overtime pay.

  • Employees paid on a piecework basis:

    These employees are paid according to the number of pieces they complete, not by the hour. They must be paid at least the minimum wage for all the hours they work in any pay period. Piecework employees are also entitled to overtime pay if they work more than 44 hours in a work week.

  • Employees paid commission only:

    These employees must be paid at least the minimum wage for all hours worked in any pay period. They are also entitled to receive overtime pay after 44 hours in a work week. Some commission employees are exempt from the overtime provisions. See "Is my job covered?" for more details.

Can employees take time off instead of overtime pay? Top

An employee and an employer can agree in writing that the employee will receive paid time off work instead of overtime pay. This is sometimes called "banked" time or "time off in lieu".

If you have agreed in writing to bank overtime hours, you must be given 1½ hours of paid time off work for each hour of overtime worked. This paid time off must be taken within three months of the week in which the overtime was earned or, if you agree in writing, it can be taken within 12 months.

If your job ends before you have taken the paid time off, you must receive overtime pay. This must be paid no later than seven days after the date the employment ended or on what would have been your next pay day.

What is an "averaging agreement"? Top

An employer and an employee can agree in writing to average the employee's hours of work over a period of two weeks or more.

With an averaging agreement, the employee's overtime entitlement isn't calculated after 44 hours each week. Instead, it's calculated after the employee has worked an average of 44 hours a week over the agreed period.

In addition to having an agreement in writing, an employer must also obtain an approval from the Director of Employment Standards and meet a number of other conditions in order to averge hours for overtime purposes.

See Your Guide to the Employment Standards Act, 2000: Overtime for more information.

Do I get overtime pay for working Sundays or for working late at night? Top

Your individual contract of employment, or collective agreement, may require it, but the ESA doesn't cover premium pay for working Sundays or late at night.

Am I still entitled to overtime pay if I agree to work longer hours? Top

Yes. If you work more than 44 hours in a work week -- whether you agreed to work those hours or were required to work extra hours under exceptional circumstances -- you are entitled to be paid overtime pay.

You can't agree to give up your right to overtime pay.

The exception would be if you and your employer had agreed in writing to average your hours of work and all the other conditions under the ESA had been met to allow your employer to average your hours for the purpose of determing your entitlement to overtime pay. See Your Guide to the Employment Standards Act, 2000: Overtime for more information about written agreements between employers and employees that average the employee's hours of work.

What if I think my employer is not following the ESA? Top

What if I think my employer is not following the ESA?

Can I see the ESA? Top

Employment Standards Act, 2000,

Resources Top

Government:
Ontario Ministry of Labour
Your Guide to the Employment Standards Act, 2000: Overtime
Information for Employees About Hours of Work and Overtime Pay



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