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Staffing Agency Paid Construction Employee Wrong Vacation Pay
In Tips Staffing v Irish, 2023 CanLII 67896 (AB ESA) (J Schick), the Alberta Employment Standards Appeal body, which is the Alberta Labour Relations Board, found that a staffing agency who dispatched a worker to construction sites was required to provide that worker general holiday pay and vacation pay applicable to employees classified as “construction employees” under the Employment Standards Code Regulations.
This case is important because it clarifies that staffing agencies are required to follow the specific rules applicable to each kind of employee under the Employment Standards Code on a “job by job” basis.
The following were the facts summarized by the ALRB:
- Tips Staffing is itself a staffing agency, and is not regularly engaged in construction activities
- The employee Jesse Irish was employed through Tips Staffing and had been deployed mostly to construction sites to do construction work for third parties
- Tips Staffing had paid Mr. Irish the general holiday pay and vacation pay amounts that apply to most Alberta employees, but not the somewhat higher amounts that would be applicable for anyone classified as a “construction employee” under the ESC regulations
- An employment standards officer awarded the employee the higher general holiday and vacation pay applicable to construction employees
- Tips Staffing appealed the decision to the ESC Appeal Body, which is the ALRB
Analysis / Conclusion
The ALRB found that the activities Mr. Irish was engaged in were construction activities within the meaning of the ESC regulation, and therefore a “construction employee”.
This was the Tips Staffing’s basic argument for why it should not have to pay the higher general holiday and vacation pay:
 … the Employer’s representative stated in no uncertain terms that he has operated for many years, and believes the temporary employment industry as a whole operates, on the basis that “industry specific” rules concerning pay, holiday and vacation (such as the construction rules at issue here) are not applicable to employees of a temporary employment agency. […] The Employer argues the Employment Standards officers who dealt with this issue had no knowledge about the temporary employment industry and are effectively seeking to “change” the requirements applicable to that industry through this complaint, and that this ought only be done by changes to the legislation or its regulations.
 As a practical matter, the Employer argues it would be impossible for it to pay different rates, including general holiday and vacation rates, to different employees based upon what type of work they are being sent to a client to perform. It suggests there needs to be consistency in what it pays its employees, and that as a temporary employment agency it cannot conform to every different rule throughout the Code and Regulation depending on what work the employee is being sent to do.
The ALRB interpreted the ESC and ESC Regulations and concluded that the general holiday pay and vacation pay rules specific to construction employees had to be followed by a staffing agency in circumstances like these, where the staffing agency would know on a “job by job” basis the sort of work the employee would be doing.
The ALRB did not say whether an ordinary employer (i.e. not a staffing agency) would have to change the method of calculation on a “job by job” basis for its employees, because it was not necessary to decide that in this case.
The result in this decision might seem obvious to the reader, but the point made by the staffing agency in this case was that it was administratively challenging for it to have to use different payroll rules each time it handled a dispatch. This was an interesting policy argument, but it was not enough to get the ALRB around its mandate to interpret and apply the legislation.
Bow River Law provides these regular legal blog articles for the purposes of legal news, education and research for the public and the legal profession. These articles should be considered general information and not legal advice. If you have a legal problem, you should speak to a lawyer directly.
Bow River Law is a team of knowledgeable, skilled and experienced lawyers handling employment law, human rights (discrimination) and labour law matters. Bow River Law is based in Calgary but we are Alberta’s Workforce Lawyers.