Average Standard Hours of Work

APPLICATION TO AVERAGE THE STANDARD HOURS OF WORK

GUIDELINES

Part 2: Hours of Work (Employment Standards Act (PDF 990KB))

10.(1) Where, in the opinion of the director, the nature of the work justifies irregular distribution of an employee's hours of work, the director may order that the standard hours of work of that employee in a week may be averaged in respect of a period of two or more weeks in such manner and in such circumstances as may be prescribed in the order.

     (2) Notwithstanding any other provision contained in this Part, where employees of an employer are represented by a trade union for the purpose of bargaining collectively, and the employer and the trade union so agree in writing, the director may order that the standard hours of work of those employees in a week may be averaged in respect of a period of two or more weeks in such circumstances as may be prescribed in the order.

     (2.1) Notwithstanding any other provision in this Part, where the employer and a majority of employees who are not represented by a trade union for the purpose of bargaining collectively so agree in writing, the director may order that the standard hours of work of the employees in a week may be averaged in respect of a period of two or more weeks, in such circumstances as may be prescribed in the order.

     (3) The director may limit the duration of an order under subsection (1) or (2) to such period of time during which he considers the circumstances under which the order is made will continue to exist.

Section 10 sets out the circumstances under which the Director of Employment Standards can issue a permit to average the standard hours of work over one or more weeks.

An averaging order or permit allows greater flexibility in the workplace for the scheduling of hours of work.

It is not an exemption from overtime.

Subsection (1) - Non-Union Worksite:

This subsection deals with a non-union employer where the nature of the work justifies irregular distribution of the hours of work.

The Director can grant an averaging order only if the nature of the work justifies the irregular distribution of an employees hours of work.

"Irregular distribution" is deemed to be any work schedule other than five, 8 hour shifts per week. This section will apply only if the nature of the work justifies the irregular hours.

If the nature of the work justifies irregular hours, the employer may apply to the Director for an order to average the hours of work over 2 or more weeks.

There are two factors that are considered when determining whether "the nature of the work justifies irregular distribution of the employees hours of work" and whether an averaging order can be granted. They are:

1. the kind of work being done, and

2. the location of the work.

The first factor is the kind of work being done. It may be a situation where the amount of work to be done varies in an unpredictable fashion or where the work must be performed while weather permits.

For example, at a fish processing plant the amount of work varies depending on when and how much fish is delivered for processing. The nature of the product requires that the processing be completed as quickly as possible.

Construction projects that are at the whim of the weather are another example. Road paving, bridge and culvert installation must all be done during favourable weather and as quickly as possible.

It is the nature or kind of work that is important not either the wishes or the convenience of the employees or the employer.

The second factor is the location of the work. Consideration would be given to issuing an averaging permit if the work is being performed in an isolated worksite. A worksite is considered isolated if the employees are unable to make their home there and must spend their off duty hours somewhere other than in their homes.

For example, a worksite such as a mining camp where employees work on a fly-in fly-out basis or a construction camp up the Dempster Highway are both isolated worksites. Another example is a highway lodge where the lodge is situated a significant distance from either Whitehorse or another Yukon town. A small Yukon community such as Haines Junction, Beaver Creek or Ross River is not considered an isolated worksite.

An averaging permit issued under Section 10(1) will not be issued for a period exceeding 3 years and if the employer is applying for the first time the period will be restricted to 1 year.

Subsection 2 - Union Worksite:

This subsection deals with a union worksite.

At a unionized worksite, the requirement that the "nature of the work justify irregular hours" is eliminated. The only requirement is that the trade union and the employer agree to the arrangement in writing.

It is assumed in a union worksite that the trade union speaks for the employees and that the two parties, the trade union and the employer are in the best position to determine what is best for that worksite.

An averaging permit issued under Section 10(2) will be issued for the period set out in the written agreement or else timed to expire with the current collective agreement.

Subsection 2.1 - Non-Union Worksite:

This subsection was included when the Act was amended in 1989.

This provision allows the Director to issue an averaging permit where the employer and a majority of employees have agreed in writing to the averaging arrangement.

For example, employees operating a steam generating plant at Watson Lake 24 hours per day, 7 days per week may prefer to work a schedule that allows them to work longer days with greater blocks of time off. If the employer and a majority of employees agree in writing, an averaging permit can be granted.

Most often the employees support or agreement is shown by having the employees sign the averaging application. The employees can be advised at the time of hire what the proposed work schedule will be if an averaging permit is granted and their agreement sought at that time.

If there is any indication that the employees are not in favour of the order or that they have been coerced into signing it, then a thorough investigation will take place including personal contact with the employees. The Employment Standards Officer investigating will recommend whether a secret ballot should be held.

Subsection 3 - Duration of the Permit:

The Director will determine the length of time any averaging permit will be granted. In the case of a first-time non-union applicant the permit will be granted for not more than 1 year, during which an audit will be done of the employers records for that period. The subsequent permits could be for a longer period, if no problems were found in the audit.

If it is a non-union seasonal operation applying under Section 10(3) the permit must be renewed annually.

Retroactivity
Averaging orders are not issued retroactively and are not renewed automatically. An averaging order expires, the employer must pay wages as set out in the Act.

Application Form
An Application for Averaging Permit can be obtained from the Labour Services Section of the Department of Community Services by calling 667-5944 or toll-free within Yukon at 1‑800-661-0408, extension 5944.

Or click here for an on-line application form (Word 44KB) that you can print, fill out, and submit to the address below.

Or write to:

Government of Yukon
C-7 Labour Services
P.O. Box 2703
Whitehorse, Yukon
Y1A 2C6

Fax: (867) 393-6317

Calculation of Pay under an Averaging Permit:
The averaging permit should be posted in an area accessible to the employees affected by it.

The employer should pay particular attention to the wording of the permit in averaging the hours of work.

Example #1:

An employer that has a construction project applied for and was granted permission to average the hours worked over a two week period.

The employee works the following hours:

*103 hours divided by 2 weeks equals 51.50 hours per week

This employee is entitled to be paid 80 regular hours and 23 overtime hours.

Example #2:

Highway lodges have applied for averaging orders so they can arrange their work schedules to enable the employees to have several consecutive days of rest to travel home, to Whitehorse or to another community to take their time off. In many cases, the lodge is located in a rather deserted spot and it often takes more than the standard two days of rest to travel and still have a period of rest before returning to work. In this case, the permit allows averaging over a 2 week period.

In such cases the employees may be schedules to work:

*80 hours divided by 2 weeks equals 40 hours per week

No overtime is payable.

Example #3:

The employer operates a mine in a remote site where the employees are transported in groups to and from work by plane or another method. The employer has been granted permission to average the hours of work over 4 weeks. The work schedule in such a situation may be as follows:

*192 hours divided by 4 weeks equals 48 hours per week

In this case 160 hours are payable at regular rate and 32 hours are payable at overtime rate.

Problem:

Monthly Salary

An employer who utilizes a monthly payroll system with a mid-month advance may have difficulty ensuring that the employees are receiving the correct pay if an averaging order is in place.

If the averaging period is a four week period commencing August 1st, 2004, that averaging period would end on August 28th. The employer is then left to deal with the pay for August 29th, 30th, and 31st.

If these days are carried forward and dealt with in the next averaging period ending September 26th, the monthly pay system is distorted. The employer is not in a position to know until September 26th whether any overtime is payable for that period.

If overtime is worked on any of the last 3 days in August and the time is paid at the regular rate with August's pay, the employer on September 26th may have to adjust August's pay and then have to deal with the last week in September’s in the same manner.

The employer may find it simpler to change the pay system to biweekly. This will eliminate the necessity to review the extra days in the month.