A common myth in Ontario workplaces is that salaried employees are not entitled to overtime pay. In reality, whether you are paid hourly or on salary, your entitlement to overtime is determined by the Employment Standards Act, 2000 (ESA)—not by your pay structure.

We regularly help employees understand their workplace rights, including severance pay entitlements and wrongful dismissal claims. In this article, we break down how overtime works for salaried employees in Ontario and the common exemptions that apply.

What Is Overtime Pay in Ontario?

Under section 22 of the ESA, eligible employees must receive overtime pay at one and a half times their regular ratefor every hour worked beyond 44 hours in a work week.

Instead of cash overtime, employers may also provide time off in lieu, meaning the employee receives 1.5 hours of paid time off for each overtime hour worked.

Who Qualifies for Overtime Pay?

Employees are generally entitled to overtime unless they fall into an exemption listed in Ontario Regulation 285/01under the ESA.

Some examples of exemptions include:

• Certain professionals (lawyers, engineers, doctors, architects).

• Information technology professionals.

• Commission-based salespeople (other than route salespersons).

• Employees whose work is managerial or supervisory in character.

The Manager or Supervisor Exemption

The ESA exempts employees whose work is supervisory or managerial in character, even if they occasionally perform non-managerial tasks.

This means that:

• Having the job title “manager” is not enough to be exempt.

• What matters is the actual nature of your duties.

The Ontario Superior Court clarified this in Tsakiris v. Deloitte & Touche LLP (2013), noting that managers are exempt because they are paid for the authority they hold—such as hiring, disciplining, or supervising staff—rather than for hours worked.

To determine if the exemption applies, courts use a two-step test:

1. Is the character of the work managerial or supervisory?

2. If yes, does the employee perform non-managerial work only on an irregular or exceptional basis?

If a “manager” regularly performs front-line tasks, they may still be entitled to overtime pay.

Can an Employee Contract Out of Overtime?

No. The ESA does not allow employees to waive their right to overtime pay. Any contract clause that attempts to remove or limit overtime pay is unenforceable.

Is the Overtime Threshold Always 44 Hours?

Not always. While most employees earn overtime after 44 hours per week, there are some exceptions. For example:

• 55 hours for employees in road building (streets, highways, parking lots).

• 50 hours for seasonal workers in canning, processing, or packing fresh fruits/vegetables.

• 50 hours for employees working on sewers or water mains.

How to Calculate Overtime for Salaried Employees

Overtime is at least 1.5 times the regular hourly rate for each hour over the threshold. For salaried employees, this requires first determining the hourly equivalent of their salary.

For example:

• Annual salary ÷ 52 weeks ÷ standard weekly hours = regular hourly rate.

• Overtime rate = 1.5 × regular hourly rate.

Employers and employees can agree to a higher overtime rate, but never a lower one. Averaging agreements (up to 4 weeks) can also be used if set out in writing.

Key Takeaway

Being on salary does not automatically exclude you from overtime pay in Ontario. Whether you qualify depends on your actual job duties and whether an exemption under the ESA applies. If your employer has denied you overtime based on your salary alone, you may still have a legal claim.