Canadian overtime rules are set by provincial employment standards legislation — there is no single federal overtime rate for most workers. Federally regulated employees (banks, airlines, telecoms, inter-provincial transport) are covered by the Canada Labour Code. Most Canadian workers are covered by their province’s Employment Standards Act. The most common overtime threshold is 44 hours per week (Ontario, BC, Alberta) at 1.5x the regular rate, though thresholds and calculation methods vary by province.
Quick Answer
An Ontario employee earning $25/hour who works 50 hours in a week earns: 44 hours x $25 = $1,100 regular pay, plus 6 overtime hours x $25 x 1.5 = $225 overtime premium, totalling $1,325 for the week. In Alberta (44-hour threshold), the same employee earns the same amount. In BC (40-hour threshold), the first 4 hours over 40 are at 1.5x and hours over 8 in a day are also at 1.5x (regardless of weekly total).
Provincial Overtime Thresholds (2025)
| Province | Weekly Threshold | Rate | Daily Rule |
|---|---|---|---|
| Ontario | 44 hours | 1.5x | None (weekly only) |
| British Columbia | 40 hours | 1.5x (40-48h), 2x (>48h) | 1.5x after 8h/day, 2x after 12h/day |
| Alberta | 44 hours | 1.5x | None (weekly only) |
| Quebec | 40 hours | 1.5x | None |
| Manitoba | 40 hours | 1.5x | None |
| Saskatchewan | 40 hours | 1.5x | None |
| Nova Scotia | 48 hours | 1.5x | None |
| New Brunswick | 44 hours | 1.5x | None |
| PEI | 48 hours | 1.5x | None |
| Newfoundland and Labrador | 40 hours | 1.5x | None |
| Federal (Canada Labour Code) | 40 hours | 1.5x | None |
Tax on Overtime Pay
Overtime pay is taxed as regular employment income — there is no special tax rate for overtime. The additional income from overtime pushes your total weekly earnings higher, and employers apply withholding based on the annualized payment method. A single week of heavy overtime can trigger higher withholding, which will be reconciled on your T1 return.
Verified Against Source
Overtime rules are set by provincial employment standards legislation: Ontario Employment Standards Act, 2000 (S.O. 2000, c. 41); BC Employment Standards Act (RSBC 1996 c. 113); Alberta Employment Standards Code (RSA 2000 c. E-9); Canada Labour Code (R.S.C. 1985, c. L-2). Source: ontario.ca/page/overtime-pay and canada.ca/en/employment-social-development/services/labour-standards/reports/overtime.html
Frequently asked questions
- What is the overtime rate in Canada?
- Most provinces require overtime pay at 1.5x the regular rate after the weekly threshold (40 or 44 hours, depending on province). BC requires 2x after 48 hours in a week and 2x after 12 hours in a day. Federal employees under the Canada Labour Code earn 1.5x after 40 hours. There is no single national overtime rate — it depends on your province and employer.
- When does overtime start in Ontario?
- Ontario overtime begins after 44 hours in a work week. Hours 45 and beyond are paid at 1.5x the regular hourly rate. Ontario has no daily overtime rule — only the weekly 44-hour threshold applies. Some occupations (IT professionals, managers above a certain salary) are exempt from Ontario overtime rules.
- When does overtime start in BC?
- BC has both daily and weekly overtime. Daily: 1.5x after 8 hours/day, 2x after 12 hours/day. Weekly: 1.5x on hours 41-48, 2x after 48 hours/week. The daily overtime applies regardless of how many days in the week the employee works. BC’s rules are among the most protective for workers in Canada.
- Is overtime taxed at a higher rate in Canada?
- No. Overtime pay is taxed as regular employment income at your standard marginal rate. There is no special overtime tax rate. However, a week with heavy overtime increases your weekly gross income. Employers who annualize the weekly earnings for withholding purposes may deduct more tax, which you recover as a refund at tax time.
- Can employers require mandatory overtime in Canada?
- Provincial laws generally allow employers to require reasonable overtime. Some provinces (Ontario, BC) allow employees to refuse overtime in certain circumstances. Unionized employees have overtime provisions in their collective agreements. Excessive mandatory overtime may constitute constructive dismissal in some circumstances — employment law advice should be sought for specific situations.
- Are salaried employees entitled to overtime in Canada?
- It depends on the province and the employee’s role. Salaried employees are entitled to overtime unless they are in an exempt category (managers, professionals, or employees earning above a salary threshold in some provinces). In Ontario, employees in IT, managers, and some other roles are exempt. In BC, managers and those classified as supervisors of other employees are exempt.
- What is time off in lieu of overtime in Canada?
- Most provinces allow employers to offer paid time off (lieu time) instead of overtime pay, with the employee’s consent. In Ontario, the employee must agree in writing. The lieu time must be equivalent to the overtime hours at the applicable overtime rate (1.5 hours off per 1 hour of overtime worked).
- How does daily overtime in BC work?
- In BC, overtime is calculated daily: any hours worked after 8 hours in a day are paid at 1.5x, and hours after 12 in a day at 2x. This applies regardless of weekly total. An employee working 10-hour days for 4 days earns 2 hours of daily overtime per day (4 x 2 = 8 overtime hours) even if the weekly total is only 40 hours.
- Are gig workers and contractors entitled to overtime in Canada?
- Independent contractors are not covered by employment standards legislation (including overtime provisions). Only employees are entitled to overtime. The distinction between employee and independent contractor is based on CRA’s and provincial labour board criteria — control, tools, profit/loss exposure, exclusivity, and integration. Misclassified workers may have overtime claims.
- Can overtime exemptions be waived in an employment contract?
- Employment standards overtime rights cannot be waived below the statutory minimum — contracts that purport to waive overtime rights are generally void to the extent they fall below the statutory floor. Employers can provide more favourable overtime provisions through contract, but cannot provide less than what employment standards require.
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Overtime in federally regulated workplaces
Employees of federally regulated employers — banks, airlines, telecommunications companies, interprovincial transport, and broadcasting — are covered by the Canada Labour Code, Part III. The federal overtime threshold is 8 hours per day and 40 hours per week. Hours beyond 8 per day or 40 per week must be compensated at 1.5 times the regular rate of pay. Employers and employees may enter into averaging agreements, allowing overtime to be calculated over a period longer than one week (up to 4 weeks), which smooths overtime liability for variable-hour work schedules. The maximum hours of work for federally regulated employees are 48 hours per week, and hours beyond that require employee consent.
Banked overtime and time off in lieu
Many provincial employment standards acts and the Canada Labour Code allow employers and employees to agree to substitute paid time off in lieu (TOIL) for overtime cash payment, at a rate of 1.5 hours of time off for each overtime hour worked. This arrangement must be in writing and the time off must be taken within a specified period (often within 3 months in provincial law, 6 months under the Canada Labour Code). If the time off is not taken within the required period, the employer must pay the overtime at the standard monetary rate. Employees cannot be required to take TOIL instead of overtime pay without a prior written agreement.
Overtime and salaried employees
Salaried employees are not automatically exempt from overtime. Provincial employment standards establish minimum overtime rules that apply unless the employer can demonstrate that the employee’s salary was intended to cover all hours worked, or that the role falls within a management or professional exemption. In Ontario, employees in a “managerial or supervisory capacity” are exempt from overtime under the Employment Standards Act. In BC, the exemption is narrower and requires that the employee’s primary duty is management. Employees who are called managers but primarily perform non-managerial tasks remain entitled to overtime.