Employee claimed his income for vacation pay should be determined same way as taxes
The Canada Arbitration Board has found an Alberta company properly calculated the vacation pay for an employee who quit without taking vacation time and denied the employee’s claims for additional vacation pay.
Dale Foster worked for Champion Feed Services, a supplier of livestock feed based in Barrhead, Alta. When he resigned on Aug. 19, 2006, he had outstanding vacation time that he was entitled to but hadn’t taken.
Champion paid Foster $2,935.20 for his vacation pay based on his earnings as well as the vacation pay owed.
However, Foster argued Champion didn’t properly calculate his vacation pay, arguing his earnings should have included his non-taxable benefits, such as Champion’s contributions towards the company pension plan and its payment towards a private health-care provider, since his income tax calculations included the benefits.
The board disagreed with Foster’s claim, saying the calculation of vacation pay under the Canada Labour Code was based on different factors than the determination of income under the Income Tax Act. In fact, the board said, the Department of Labour’s guidelines listed the factors to be included in the calculation of labour pay, which included the vacation pay owed and remuneration for work performed but not benefits.
“The calculation of wages is very clear and does not include the non-taxable benefits claimed by (Foster),” the board said. “They are not included in the list and therefore are not included in the calculation for the purposes of calculating vacation pay.”
The board found, though Foster didn’t agree with the way Champion calculated his vacation pay, the company followed the guidelines properly and gave him the correct amount of vacation pay he was owed.
”While (Foster) was not satisfied nor did he find logical the method of calculation, that is not the point. The point is that there is a method of calculating vacation pay. It is straightforward and (Foster) chose to not accept it,” the board said.
Foster’s claim was dismissed and he was ordered to pay Champion’s costs. See Foster v. Champion Feed Services Ltd., 2009 CarswellNat 650 (Can. Arb. Bd.).
Dale Foster worked for Champion Feed Services, a supplier of livestock feed based in Barrhead, Alta. When he resigned on Aug. 19, 2006, he had outstanding vacation time that he was entitled to but hadn’t taken.
Champion paid Foster $2,935.20 for his vacation pay based on his earnings as well as the vacation pay owed.
However, Foster argued Champion didn’t properly calculate his vacation pay, arguing his earnings should have included his non-taxable benefits, such as Champion’s contributions towards the company pension plan and its payment towards a private health-care provider, since his income tax calculations included the benefits.
The board disagreed with Foster’s claim, saying the calculation of vacation pay under the Canada Labour Code was based on different factors than the determination of income under the Income Tax Act. In fact, the board said, the Department of Labour’s guidelines listed the factors to be included in the calculation of labour pay, which included the vacation pay owed and remuneration for work performed but not benefits.
“The calculation of wages is very clear and does not include the non-taxable benefits claimed by (Foster),” the board said. “They are not included in the list and therefore are not included in the calculation for the purposes of calculating vacation pay.”
The board found, though Foster didn’t agree with the way Champion calculated his vacation pay, the company followed the guidelines properly and gave him the correct amount of vacation pay he was owed.
”While (Foster) was not satisfied nor did he find logical the method of calculation, that is not the point. The point is that there is a method of calculating vacation pay. It is straightforward and (Foster) chose to not accept it,” the board said.
Foster’s claim was dismissed and he was ordered to pay Champion’s costs. See Foster v. Champion Feed Services Ltd., 2009 CarswellNat 650 (Can. Arb. Bd.).
