In Kelly v Majestic Electric Inc., 2026 ABESAB 10 (Semaine), the Employment Standards Appeal Body (“ABESAB”) found an electrician was entitled to unpaid overtime, despite some terms in an overtime agreement which suggested otherwise.
This case should serve as a reminder that the Alberta’s minimum employment standards are mandatory laws, not guidelines.
Facts
The following were the pertinent facts summarized by the ABESAB:
- The employee Jacob Kelly worked for Majestic Electric as an apprentice electrician for over 2 years
- All employees of Majestic sign on to a written overtime agreement which effectively defines overtime as any hours in a week exceeding 44 hours (the “OT Agreement”). The OT Agreement says that overtime is banked, and employees are to take time off with pay for those banked hours
- Majestic’s evidence was that in practice, if an employee worked less than 88 hours in a 2-week period, Majestic would use the banked time to top them up to 88 hours
- Majestic acknowledged at the appeal that it mistakenly did not consider hours worked over 8 hours per day and accepted that a total of 41.5 hours were not properly captured as overtime hours
- The Employment Standards Officer had ruled that 41.5 hours had to be paid at the rate of 1.5 x ordinary wages
- Majestic appealed, arguing the hours had already been paid at the employee’s regular wage rate. This, they argued, should count as “time off with pay” for the week after the employee quit, resulting in no 1.5 x ordinary wages overtime calculation.
Analysis / Conclusion
The ABESAB first noted that because of section 90(3) of the Employment Standards Code (ESC), overtime claims brought under the ESC could only go back 6 months from the earlier of the claim date and the termination date. So, that was the period assessed in this case.
The ABESAB acknowledged that Majestic had an overtime agreement, but found that the calculation in that agreement did not consider over 8 hours of work in a day to be overtime, and therefore, it violated ESC’s section 21 requirement that any hours over 8 in a day or 44 in a week be considered overtime. The ABESAB voided that portion by using section 4 of the ESC and then applied the required calculation to Mr. Kelly’s hours.
There were 41.5 hours unaccounted for in Majestic’s calculation of overtime.
The ABESAB considered Majestic’s argument that the 41.5 hours should just be considered “time off with pay” at regular wage rates during the period after Mr. Kelly quit working for Majestic. He ABESAB rejected this argument as follows:
[20] […] an overtime agreement is deemed to provide time off with regular pay instead of overtime pay where the employee could have otherwise worked, but the Respondent left work with Majestic, and so the days that follow his leaving, cannot be considered “time off”.
The ABESAB found that Majestic had already paid the employee 41.5 hours as “regular time”, and ordered that Majestic top that up so that the total would equal 41.5 hours at 1.5 times the employee’s wage rate.
My Take
It does not look to me like Majestic was intentionally violating the ESC with the overtime agreement. It looks like it was done for efficiency and flexibility purposes.
However, this case is just one example of how the ESC officers treat any agreement which attempts to provide less than the ESC’s minimum protections. Any portion of any agreement purporting to do this will be struck out as void.
I must also admit I found Majestic’s argument about how the final banked OT should be paid out at regular time to be quite clever. It did not work ultimately, but it was interesting.
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