Jaime asked:

My employee has just given notice that she is looking for a new job. I have already given her far more paid vacation time than she has actually earned for this calendar year, what are my rights and/or options? I am in Ontario.

Jane Southren answered:

Unless you have reserved the right to be repaid or reimbursed for vacation taken in excess of what has been earned at any given time there is nothing you can do to recapture the excess amounts paid for vacation when someone gives notice or is terminated. In short, you are out that money and you still have to pay them their regular wages for the notice period.

That is one of the reasons that we recommend that employers have employment contracts created for employees. They can do things like set out that the employee cannot take any vacation until they have worked long enough to earn the amount of vacation they want to take (eg. if an employee gets four weeks vacation annually they cannot take the first week until after they have worked a full quarter, the second week until they have worked the second quarter, etc.)

A contract can also specify that an employer has a right to set off any final pay packet against debts the employee owes it such as petty cash loans or salary for vacation taken but not earned in advance of the termination date.

There are numerous other rights that an employer can protect in an employment agreement that will not be available to them if they do not reserve them in an employment agreement.

About the author

Jane practises as a civil litigator, with a focus in the areas of employment law, breach of contract, professional negligence and dispute resolution strategies. Having completed both her LLB and JD degrees from the law schools of the University of Windsor and the University of Detroit (Mercy) in 1995, Jane was called to the Ontario Bar in 1997, invited into the partnership of McDonald & Hayden LLP in Toronto in 2001.

In 2005 she joined Lerners LLP where she is now a partner in its commercial litigation group. Jane has appeared as counsel before the Superior Court of Justice, the Ontario Court of Appeal and a number of administrative tribunals. She is a member of The Advocates' Society and has participated in numerous legal and professional education programs, including acting as an instructor in the Ontario Bar Admission Course. During the course of her career, Jane has authored numerous articles in her areas of practice, including a regular column in the Advocates’ Brief, in which she offers practical advice and guidance to newer lawyers on subjects relating to their areas of practice.

Jane can be contacted by telephone at 416-601-4128 or via e-mail at jsouthren@lerners.ca.

 
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