Annual vacation

Workers, whether full time or part time, are entitled to a vacation each year and a vacation indemnity, commonly referred to as “vacation pay”.

The Loi sur les normes du travail establishes the minimum duration of annual vacation and provides for a method of calculating the indemnity.

Establish duration of vacation and amount of compensation

To establish the length of vacation and calculate the amount of the indemnity, the employer must take 3 factors into account:

• the reference year used in their company to establish vacation entitlement
• the worker’s number of years of uninterrupted service
• the gross wages earned during the reference year

Reference year

Vacation accumulates over a period of 12 months, called the “reference year”. The worker must take their vacation within 12 months of the end of the reference year.

The employer may also, at the employee's request, allow vacations to be taken, in whole or in part, during the reference year.

In most cases, the reference year runs from May 1 to April 30. The period may be different if the employer, a decree or a collective agreement sets other dates.

Length of vacation and indemnity

The length of annual vacation is based on the number of years of uninterrupted service at the end of the reference year.

The amount of vacation indemnity is calculated based on the gross wages earned during the reference year (4% or 6%).

This is what can be expected based on the number of years of continuous service. It is a minimum requirement of the Act respecting labour standards.

An employer may decide to offer more than 3 weeks of vacation or to grant different working conditions. This is part of their right to manage, as long as the conditions offered comply with the basic standards set by the Act.

Would you like to know how much compensation you're entitled to? Use our online tool monCalcul.

Examples of how vacation indemnity is calculated

Here are 2 examples of vacation pay calculations, one for a person with 2 years of continuous service (4%) and the other for a person with 3 years of continuous service (6%).

2 years of uninterrupted service

Mario is credited with 2 years of uninterrupted service at the end of the reference year.

Calculation Details

Important information for this example:

• May 1, 2023, to April 30, 2024 (reference year for calculation)
• February 17, 2024 (2 years of completed continuous service)
   

1. Establish when Mario will be entitled to his 2-week vacation and 4% allowance
   
   Mario's 2 years of continuous service were reached on February 17, 2024, i.e. during the reference year from May 1, 2023, to April 30, 2024.
   
   As of April 30, 2024, Mario may take 2 weeks' vacation between May 1, 2024, and April 30, 2025. He will receive his 4% allowance at the beginning of his leave, or in accordance with the terms and conditions applicable to the regular payment of his salary.
    
2. Calculation of vacation pay
   
   Total gross salary earned between May 1, 2023, and April 30, 2024 x 4% = vacation pay
   
   $25 600 x 4% = $1 024
    
3. Result
   
   Mario will receive $1 024 in vacation pay for his 2-week vacation.

3 years of uninterrupted service or more

Stéphanie completed 3 years of continuous service on September 21, 2023. The reference year for vacation calculation in the company where she works is from May 1 to April 30.

Her employer will have to calculate the 6% vacation pay on the gross salary earned during the full 12 months of the reference year, i.e., the reference year in which she reached her 3 years of continuous service. The calculation of the indemnity must therefore include the gross salary earned before September 21, even if she had not yet reached her 3 years of continuous service.

Calculation Details

Important information for this example:

• May 1, 2023, to April 30, 2024 (reference year used for calculation)
• September 21, 2023 (3 years of completed continuous service)
   

1. Establish when Stephanie will be entitled to her 3 weeks' vacation and 6% severance pay
   
   Stephanie's 3 years of continuous service are reached on September 21, 2023, i.e. during the reference year from May 1, 2023 to April 30, 2024.
   
   Stephanie can therefore take her 3-week vacation between May 1, 2024, and April 30, 2025.
    
2. Calculation of vacation pay
   
   Total gross salary earned between May 1, 2023, and April 30, 2024, x 6% = vacation pay
   
   $45 000 x 6 % = $2 700
    
3. Result
   
   Stéphanie is entitled to 3 weeks of vacation and a $2 700 allowance to be paid before the start of her vacation, or according to the terms applicable to the regular payment of her salary.

Calculating vacation pay in the event of absence from work

Here are 2 examples of how vacation pay is calculated in the event of a worker's absence from work.

Examples of how the vacation indemnity is calculated if the worker is absent

Example including a 26-week sickness absence

Sylvain is credited with 2 and a half years of uninterrupted service.

Sylvain is entitled to 2 weeks vacation and a vacation indemnity of 4%.

During the last reference year, Sylvain worked 26 weeks at $600 per week and was absent from work owing to sickness for another 26 weeks.

Calculation: 26 (weeks worked) x $600 (wages per week) = $15 600

$15 600 ÷ 26 = $600 (average wages earned per week)

$600 (average wages earned per week) x 2 (vacation weeks) = $1 200

Sylvain will receive a vacation indemnity of $1 200 for his 2 weeks of vacation.

Example including maternity leave

Élizabeth is credited with 8 years of uninterrupted service.

So she is entitled to 3 weeks vacation and a vacation indemnity of 6%.

Élizabeth worked 24 weeks at $800 per week and was on maternity leave for 18 weeks as well as on parental leave for 10 weeks.

Calculation: $800 (average wages earned per week) x 3 (number of vacation weeks) = $2 400

$2 400 x 42 (24 weeks worked + 18 weeks of maternity leave) ÷ 52 weeks in the year = $1 938.46

Élizabeth will receive a vacation indemnity of $1 938.46 for her 3 weeks of vacation.

NOTE: Her weeks of parental leave are excluded from the calculation because the vacation indemnity does not accumulate during this period. The vacation indemnity that Élizabeth will receive must not exceed what she would have been entitled to had she remained at work (i.e., had she not been on maternity leave).

Timing of vacation

The employer chooses the vacation period for their employees. They must inform them of the dates of their vacation at least 4 weeks in advance. 

The worker must receive his vacation indemnity in a lump sum before they start their vacation or at the time of the current pay covering the period of their vacation.

A compensatory indemnity may not be paid to a worker to replace their vacation period, unless:

• a collective agreement or a decree contains a specific provision to this effect
• the establishment closes for 2 weeks during the vacation and a worker entitled to 3 weeks asks to have the last week replaced by an indemnity

Early vacation

At the worker’s request, the employer may allow them to take all or part of their vacation during the reference year. The proportion of the indemnity that will then be paid is determined by the worker and the employer. For example, the indemnity could be calculated based on the wages:

• earned since the beginning of the reference year
• anticipated for the whole reference year

Deferred vacation

A worker's vacation may be deferred to the following year only if, at the end of the 12-month period following the reference year, they are absent or on leave:

• owing to a non–work related accident or illness
• for organ or tissue donation for transplant
• because of domestic or sexual abuse
• owing to serious bodily injury arising out of or resulting from a criminal offence against them
• for family or parental reasons, including absence due to the state of health of a person for whom they act as a caregiver

The employer has the right to deny the request. They must then pay the worker the vacation indemnity to which they are entitled.

Divided vacation

An employer cannot impose the division of the vacation period.

One week vacation or less

Vacations of one week or less must be taken consecutively.

One week vacation or more

A worker who has more than one week of vacation may choose to divide their vacation into 2 periods or take them consecutively.

Their employer may refuse to divide the vacation period only if they close their business during the vacation period or for a longer period.

To divide their vacation into more than 2 periods, for example into 8 Mondays, the worker must have their employer's consent.

Vacation of one week or less cannot be divided.

Additional leave

A worker who is already entitled to 2 weeks of vacation may request an additional week's leave without pay. The employer must grant this leave. The worker cannot demand to take this third week after the other 2 weeks. This additional leave cannot be divided into several periods unless the employer allows it.

If an employee is entitled to 3 weeks or more of leave per year, they may request additional leave at their own expense, but his employer has the right to refuse it.