Averaging agreement for hours worked

Alberta standards more strict that some other jurisdictions
By Tim Mitchell
|Canadian Employment Law Today|Last Updated: 11/28/2012

Question: Can an averaging agreement for hours worked be binding under Alberta labour standards rules?

Answer: Some Canadian jurisdictions explicitly provide for averaging agreements in their employment standards statutes. The number of hours worked is averaged over a given period and regular and overtime hours of work are calculated at the end of the period rather than be confined to the pay periods in which they were worked. Where averaging is permitted by statute, rules differ by jurisdiction with respect to whether the agreement must be posted and approved by government, the written detail required, time limits for the agreement and averaging period, when overtime worked during the averaging period is payable and other requirements.

In Alberta, averaging agreements are problematic. Generally speaking, the Alberta Employment Standards Code does not permit the practice of paying wages for an average number of hours worked over more than one pay period. The typical averaging agreement will violate the code in various respects, namely its overtime rules (s. 21) and possibly others, like mandatory payment of wages within 10 days of the end of a pay period in which the wages were earned (s. 8), deductions from earnings (s. 12) and the providing of pay statements setting out regular and overtime hours of work (s. 14).