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Hello,

I have been employed part-time at a retail store for over six years under my current employment agreement. Since I was hired, I have received vacation pay as a 4-6% payout on each paycheck.

Recently, the company issued a notice indicating that vacation pay will no longer be paid out on each paycheck. Instead, it will be accrued as a vacation balance and provided as paid time off. The notice also states that vacation entitlement will now be based on years of service. This change was communicated in February and is set to take effect approximately four weeks later in March. It appears to be mandatory, and no updated employment contract has been provided for review or signature.

Could you please advise whether this change is permissible, specifically whether an employer can move from paying vacation pay on each paycheck to an accrued vacation system without a new contract or employee agreement?

We recommend you direct your question to the Ministry of Labour as they will enforce workplace standards should there be any irregularities: https://www.ontario.ca/document/your-guide-employment-standards-act-0/filing-claim#section-1
The Lawyers at Samfiru Tumarkin LLP
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