How Wages Are Paid - Act Part 3, Section 20


Contents:

Summary
Text of Legislation
Policy Interpretation
Related Information


Summary

This section identifies acceptable forms of paying an employee wages. 


Text of Legislation

20. An employer must pay all wages

(a) in Canadian currency,

(b) by cheque, draft or money order, payable on demand, drawn on a savings institution, or

(c) by deposit to the credit of an employee's account in a savings institution, if authorized by the employee in writing or by a collective agreement.


Policy Interpretation

The method an employer uses to pay wages must comply with the provisions of the Act.

Any form of payment must be negotiable in Canadian currency. Methods of payment are cash, cheque, or similar financial instruments drawn on a bank, trust company, or credit union.

An employer may directly deposit wages to an employee's account if the employee provides the employer with written authorization to do so, or if the collective agreement provides for direct deposit.

Farm labour contractors are excluded from this section of the Act. Section 40.2 of the Employment Standards Regulation requires farm labour contractors to pay wages in Canadian currency by way of direct deposit to the credit of a farm worker's account in a savings institution.

Employees covered by a collective agreement

Section 3 provides that parties to a collective agreement may not negotiate terms and conditions that do not meet or exceed the standards set out in section 20. Where there is a collective agreement, the enforcement of matters relating to section 20 is through the grievance procedure, not through the enforcement provisions of the Act.


Related Information

Related sections of the Act or Regulation

ESA

ESR