Employment Law
Minimum Wage and Wage Deductions in Alberta: An Overview
Written on behalf of Getz Collins and Associates on
Ensuring fair compensation and adherence to employment and labour laws is crucial for Alberta’s workforce. Understanding minimum wage and permissible wage deductions is paramount for employers and employees.
This blog post provides an overview of Alberta’s minimum wage standards set out by the provincial Employment Standards Code and clarifies the rights and responsibilities of both employees and employers regarding minimum wage payments and wage deductions.
Alberta’s Minimum Wage
The Alberta Employment Standards Code (the “Code“) establishes the minimum wage employers must pay their non-unionized employees. The minimum wage applies to all hours worked. Currently, Alberta’s minimum wage is set at $15.00 per hour. However, workers in certain industries, including those listed below, are exempt from minimum wage standards:
- real estate brokers;
- securities salespersons;
- insurance salespersons paid entirely by commission;
- students in a work experience program approved by the Alberta government;
- students in an off-campus education program provided under the Education Act;
- extras in a film or video production;
- counsellors or instructors at a non-profit educational or recreational camp for children, handicapped individuals, or religious groups;
- municipal police service members;
- post-secondary academic staff.
Understanding Minimum Wage Basics
Employers must pay non-unionized employees at least the minimum wage, with the current general minimum wage applied to all employees. Students under the age of 18 are exempt from this rule. Employees’ wages and the minimum wage standards do not include tips or expense money. Further, different weekly and monthly minimum wages will apply to some salespersons and domestic employees.
Employee Minimum Wage Entitlements
Understanding minimum wage and other entitlements under the Code is crucial for all employees. Employees are entitled to the minimum wage for all hours worked, including regular hours and time spent on call or waiting for work (with some exceptions). If an employee works more than 44 hours in a workweek, they are entitled to overtime pay at 1.5 times their regular rate of pay.
Employees should also know that their employer cannot deduct from an employee’s wages in a manner that reduces their earnings below the minimum wage. For example, if an employee’s wages are deducted for meals provided by the employer and the deduction brings the employee’s net pay below the minimum wage, the deduction amount must be adjusted.
Hourly Minimums
Employees must be paid for at least 3 hours of pay at the minimum wage each time they report to work, whether or not they are required to work for the full 3 hours. However, this only applies if an employee can work the full 3-hour period. If an employee works for fewer than 3 consecutive hours, the employer must pay wages that are at least equal to 3 hours at the minimum wage. However, when an employee’s wage exceeds the minimum wage, the employer may pay them for less than 3 hours of work at this higher rate.
Moreover, the Code stipulates that the following employees must be paid compensation (at least minimum wage) for at least 2 hours:
- school bus drivers;
- part-time employees of non-profit recreation or athletic programs run by a municipality, Metis Settlement or community service organization;
- home care employees; and
- adolescents (13, 14 and 15 years of age) who work on a school day.
Employers Must Uphold Minimum Wage Standards
Employers are legally obligated to adhere to the minimum wage standards outlined under the Employment Standards Code. Employers must pay their employees at least the minimum wage for all hours worked. As such, employers must maintain up-to-date and accurate records of the hours each employee worked, the wages paid to each employee, and any deductions made.
Employers must also provide every employee with a detailed pay statement for each pay period that outlines the gross wages earned, deductions made, and net pay received by the employee.
Wage Deductions: What Can (or Cannot) be Taken
The Employment Standards Code allows employers to make certain deductions from employees’ wages – subject to strict guidelines. The Code permits employers to make deductions under specific circ*mstances and with the employee’s written consent unless mandated by law. Employers must provide employees with a clear explanation of any deductions on their pay statement, including the reason for the deduction, the amount deducted, and the legal authorization. Obtaining the employee’s written consent is crucial for any deductions not mandated under applicable legislation.
Authorized Deductions
The Employment Standards Code outlines various deductions that an employer is permitted to apply to an employee’s earnings, including:
- Legally Required Deductions: These are deductions that are mandated by federal or provincial law and may be taken from an employee’s wages without their consent. This includes deductions for income tax, Employment Insurance (EI), and Canada Pension Plan (CPP) contributions.
- Court-Ordered Deductions: If a court order mandates wage garnishment for reasons like child support or outstanding debts, employers must comply and apply such deductions to an employee’s wages.
- Union Dues: For employees who belong to a union with a collective agreement, deductions for union dues are permitted.
- Recovery of an Overpayment: Employers are permitted to make deductions from an employee’s wages if there was a payroll calculation error. Although employers do not need written authorization from the employee for this type of deduction, they must provide employees with written notice prior to making such a deduction.
- Meals and Lodging: With written authorization from the employee, employers may reduce an employee’s wages below the minimum wage by a maximum of $4.41 for each day the employer provides the employee with lodging and by $3.35 for each meal consumed by the employee. However, deductions are not permitted for meals that the employee does not consume.
Unauthorized Deductions
The Code also protects employees from unfair wage deductions. The following list outlines deductions which an employer is not permitted to make:
- Uniforms: Employers cannot deduct any costs associated with the purchase, use, cleaning or repair of a uniform that an employee is required to wear during their work hours.
- Deductions for Faulty Work: Employers cannot make deductions for faulty work. This includes any act or omission of an employee that results in a loss to the employer, such as accidental damages to an employer’s vehicles or production mistakes.
- Deductions for Cash Shortages or Loss of Property: Deductions cannot be made for cash shortages or loss of property if other persons have access to said cash or property. This includes access by the employer or their representative, other employees, or customers.
Contact Getz Collins and Associates for Advice on Minimum Wage Entitlements and Wage Deductions
The experienced labour and employment lawyers at Getz Collins and Associates regularly assist clients with various workplace matters, including wrongful termination, constructive dismissal, and claims under the Employment Standards Act. With offices located in Calgary and Strathmore, our employment law team provides each client with comprehensive legal solutions tailored to their unique needs. Contact us online or by phone at (587) 391-5600 to discuss your employment law matter with a member of our team.
