THE QUESTION
I have always wondered why salaried employees are not eligible for overtime pay. My work week has always been 50 hours or more. It's a running joke with my peers about how it is impossible to do my job in 40 hours. In fact, the company has always expected more than 40 hours, yet my salary has never reflected this de facto demand.
THE FIRST ANSWER
Bill Howatt
Chief research and development officer, Morneau Shepell, Toronto
You're not alone. Whether an organization is private, public or government, many salaried employees work long hours. An employment lawyer can provide advice on your specific employee contract. Many organizations are beginning to notice the implications of the 50-hour work week, especially when trying to replace leaders. The challenge of encouraging younger professionals to take on more leadership responsibility is becoming noticeable. Why? Millennials are motivated by career opportunities, corporate social responsibility, employee health and well-being, employer reputation, learning and development opportunities, the company's senior leadership and work-life balance. The importance millennials put on their work-life balance may discourage them from taking on more responsibility and working longer hours "for a few more dollars after taxes," as one put it the other day. This suggests money or a title may not be the primary motivator.
The cost of long hours, with respect to employee health, increased benefit claims, turnover and disability claims is gaining the attention of senior leaders. The good news is that many are asking what they can do to curb health risk, such as by reducing work demand.
Fortunately, the tide is changing. Organizations have invested heavily in technology and process mapping to maximize productivity. The next big gains in efficiency will happen only through improved work-force productivity.
THE SECOND ANSWER
Stuart Rudner
Partner, Rudner MacDonald LLP, Toronto
The basic premise of this question is actually inaccurate, although it is a common misconception. The reality is that employees are entitled to overtime pay, but certain exemptions are built into employment-standards legislation.
However, those exemptions are based upon the nature of an individual's position and duties, and entirely unrelated to the manner in which they are paid. In other words, the common view that someone is not entitled to overtime pay because they are paid by salary is wrong.
Every jurisdiction in Canada has its own employment-standards legislation, and each one addresses overtime in a slightly different manner.
In Ontario, statutory overtime applies to all hours worked in a week beyond 44. An individual working more than 44 hours in a week is entitled to overtime pay (at time-and-a-half) or, if they agree, time off in lieu (also at time-and-a-half). Employers and employees can agree to average the hours of work over several weeks and this will affect the individual's entitlement to overtime pay.
The most common exemption from eligibility for overtime pay is for supervisors and managers. However, this applies only if the individual is employed in a truly managerial or supervisory capacity; the individual's title will not be determinative, and courts or government agencies will examine the nature of their duties.
It is also important to remember that while someone may not be entitled to statutory overtime pay, that does not mean that they are not contractually entitled to compensation for additional hours. For example, if an individual's contract of employment provides that they will be required to work 40 hours a week, then they should be entitled to compensation for any time beyond 40 hours. Conversely, some executives will have very clear contractual terms which provide that their salary is intended to cover all hours worked, and that they are expected to work the hours required in order to fulfill their duties.
Bill Howatt