How Should Employers Reward Overtime Work?

Guest Blogger

By Guest Blogger

November 9, 2021

Across Canada overtime is seen as a way to earn some extra dollars on top of a basic wage, especially over the holidays. As an employer, you must make sure you track and pay your employees' overtime correctly.

In this article, we’ll discuss the overtime pay rates across Canada, non-financial rewards you can offer for overtime and, the legalities surrounding overtime pay.

What is overtime work?

Overtime work is any hours worked by an employee that exceed their scheduled working hours. As per Statistics Canada, over 2.5 million people work overtime on a regular basis. Overtime is usually offered during a busy shift, or when staffing levels are lower than usual. Overtime is common with hospitality and retail businesses, particularly during the holidays.

What are the rules when it comes to overtime?

The overtime pay rate is consistent across all the Canadian provinces, at 1.5 times an employee's regular hourly pay. But the number of hours needed to work before qualifying for overtime differ slightly.

As an employer, it’s your responsibility to make sure your company matches local legislation.

How to calculate overtime pay correctly

You must ensure you calculate your employees' overtime pay correctly as one of the main reasons for employees working overtime is for the extra pay. 

If you pay your staff’s overtime pay incorrectly, even by accident – it could negatively impact employee engagement and lead to future refusal of overtime. 

Use this simple calculation to work out overtime pay correctly: 

  1. Determine weekly rate: multiply hourly rate by the number of hours worked in a week. For example, $16 hourly rate x 44 hours = weekly pay of $704.
  2. Multiply hourly rate by 1.5: overtime rate is $16 x 1.5 = $24.
  3. Multiply overtime rate by number of overtime hours: If 10 hours overtime, $24 x 10 = $240.
  4. Add regular wages and overtime pay together: $704 + $240 = $944.

Other non-mandatory overtime rewards

Overtime rewards aren’t always about money. While you must pay employees' overtime correctly - there’s nothing stopping you from offering additional incentives to encourage employees to work overtime. These can be seen as a nice perk for your staff, and it shows that you are willing to go that extra mile to appreciate the hard work they put in. 

First, you can always offer financial bonuses that are higher than the mandatory 1.5 times regular overtime pay. 

Alternatively, the following non-financial incentives can also be offered:

  • Extra vacation day following a busy period.
  • Start the next day of work later after overtime was worked or offer an early finish.
  • Gift cards for food or shopping outlets.
  • Provide meals for workers.

The amount of non-financial bonuses and the frequency in which they are offered is important for retaining and attracting the best talent. If staff feel valued and appreciated this can lead to a more positive atmosphere to work in, and ultimately an increase in productivity.

What to watch out for as an employer

As an employer, there are certain actions that can lead to potentially paying overtime wages incorrectly.

You may not intend to avoid paying overtime, but the following activities are common ways people try to skip out on paying more:

  • Carrying overtime hours over into the next working week.
  • Asking employees to perform small tasks off the clock.
  • Asking employees to perform tasks before clocking in or after clocking out such as opening and cleaning up.
  • Automatically deducting time for lunch and breaks.
  • Stating on the sheet that someone is a manager, so they’re exempt from overtime.

If you do these, your employees could report you to employment standards, and you could be faced with compensation to pay - which is usually more than you would have paid them in the first place. 

This practice could also stain your company’s reputation, which may lead to staff leaving the organization or making it difficult for you to attract new employees.

Legalities surrounding overtime pay

You need to be aware of which employees qualify and are eligible to work overtime hours. For example, if an employee has managerial responsibilities within their working day, they do not qualify for overtime. Neither do professions such as lawyers, dentists, or architects. 

According to the Canadian Labour Code, federal law requires employers to pay at the correct rate. If an employee hasn’t been paid correctly for any overtime worked, they may be entitled to compensation. 

Employees can make an employment standards claim against you if they haven’t been paid their overtime correctly. The Ministry of Labour can order employers to pay employees the money they’re owed.
Any claims must be submitted within two years of the date the wages were owed to the employee. 

To summarize, offering overtime is commonplace in Canada and throughout the world. You, as an employer, have a right and responsibility to your employees to ensure you record and pay overtime correctly.


This article was provided by BrightHR, HR management software used to cut staff administration, boost productivity, and make your business a success. 

More Popular Posts...

Health Spending Accounts For Canadians Explained

A Health Spending Account (HSA), also known as a Health Care Spending Account (HCSA) or Health...

Sarah Mitchell

By Sarah Mitchell

October 19, 2021

Mandatory Employee Benefits in Canada

It's common for employers to provide full-time employees with a benefits package, known as employee...

Paige Latimer

By Paige Latimer

July 25, 2022

A Guide to Taxable Benefits in Canada

Employee benefits can be broken down into two types: taxable and non-taxable - but what’s the...

Paige Latimer

By Paige Latimer

September 2, 2021

Want blogs delivered right to your inbox?

Subscribe to our Monthly Benefits Blast.

Simply Benefits Inc. (“us”, “we”, or “Simply Benefits”) is committed to privacy and the protection of your information. By using Simply Benefits’s website, mobile and other applications, and related Services made available through the Apple App Store, the Google PLAY Store, or otherwise on the Internet (together, the “Simply Benefits Applications” or “Applications”), you acknowledge that you accept the practices and policies outlined in this Privacy Policy (“Privacy Policy“). Unless otherwise defined herein, capitalized terms shall have the meanings assigned to such terms set forth in the Terms of Service and which incorporate this Privacy Policy by reference.

At Simply Benefits Corp ("Simply Benefits") we are concerned with safeguarding and protecting the privacy of your personal information.

In accordance with Canada's *Personal Information Protection & Electronic Documents Act* ("PIPEDA") we have established policies on how we collect, use and protect any information that you give us when you use our website or services.

What We Collect

Required Regulatory Information

Simply Benefits collects information needed to provide services and meet the regulatory requirements of our industry. When you open an account or sign up for services, we collect personal information which may include but is not limited to the following:

  • Your name and date of birth

  • Contact details

  • Nature of your employment or business

  • Details about your dependents

  • Demographics

  • Other information relevant to the services we provide

Passive Data Collection

We may receive passively-collected information through a variety of methods, including “cookies” to collect information.

What is a cookie?

Cookies are text files containing small amounts of information which are downloaded to your device when you visit a website. Cookies are then sent back to the originating website on each subsequent visit, or to another website that recognizes that cookie. You can get more information about cookies here.

Simply Benefits uses cookies to track and measure site performance and gather analytics on usage. This information is anonymous and is only used by Simply Benefits to measure and improve our site.

When sending e-mail we may use tracking pixels and urls to help us measure open rates for e-mails and link clicks. This tracking information is used internally only to help us provide relevant content and is never shared with any third parties.

Opting Out of Cookies

If you choose, you may set your browser to notify you when you receive a cookie, giving you the chance to decide whether or not to accept it.

Analytics And Marketing

We use analytics tools and other third party technologies, such as Google Analytics, to collect non-personal information in the form of various usage and user metrics when you use our online Sites and/or Services.

We also use online advertising to reach new potential clients and remarketing tools that allow us to target ads to specific groups of people who have previously interacted with WealthBar’s websites.

Google allows individuals to opt out of it’s advertising cookies from its ad settings page.

Google has additional information available about their Remarketing Privacy Guidelines, and Restrictions.

Where do we store it

Simply Benefits may use third parties to store and process data. Simply Benefits will ensure that such third party service providers have significant expertise with data and digital privacy. Simply Benefits will ensure that personal data is stored and transmitted in encrypted format using technology such as SSL. Third party data storage and processing providers may be located in the United States and as a result personal information may be subject to U.S. privacy law which may differ from Canadian privacy law.

How We Use It

The information we collect is used so we can communicate with you, provide benefits and insurance management services, improve our products and services, and meet our regulatory obligations.

We share only the information which is reasonably required in the normal course of business with third parties such as our custodians, securities regulators, auditors, legal counsel, or law enforcement agencies, to enable them to fulfill their obligations to Simply Benefits and our clients. We may also disclose your personal information to third-party service providers, affiliates and agents in order to assist us in providing the services you requested and to fulfil the purposes for which your personal information has been collected. Outside of this we shall not sell, distribute or lease your personal information to third parties unless we have your permission or are required by law to do so.

How We Protect It

We are committed to ensuring that your information is secure. In order to prevent unauthorized access or disclosure, we have put in place suitable physical, electronic and managerial procedures to safeguard and secure the information we collect online. In the event that we share your personal information with third-party service providers, affiliates and agents, these parties will be required to adhere to strict confidentiality obligations and practices.

If you have a question, concern or complaint about our privacy policy, please send your comments and your contact details to our Privacy Officer in writing to the following address:

Simply Benefits Corp.

601-460 Doyle Ave,

Kelowna BC

V1Y 0C2

If you believe that any information we have on file for you is incorrect or incomplete, please write to or email us as soon as possible, at the above address. We will promptly correct any information found to be incorrect.