Summary: Averaging Agreements in Alberta
An averaging agreement is a legal arrangement that allows an employer to “average” an employee’s hours over a period of 1 to 52 weeks to determine overtime eligibility.
Under these agreements, the standard 8/44 overtime rule is modified, often resulting in fewer overtime hours being paid out than in a standard work week.
Know Your Pay. Protect Your Overtime.
Averaging agreements are a common tool for Alberta employers to manage labor costs in industries with fluctuating schedules. However, these agreements must follow strict provincial guidelines to be valid. If your agreement doesn’t comply with the law, you may be owed significant back pay for unpaid overtime.
On This Page:
How Hours are Averaged
What Makes an Averaging Agreement Valid?
Ending or Changing an Agreement
Get a Professional Review
What is an Averaging Agreement in Alberta?
In a standard Alberta workplace, overtime is calculated on a daily (over 8 hours) and weekly (over 44 hours) basis. An averaging agreement in Alberta changes this dynamic. These agreements allow for a flexible schedule where an employee might work 10 or 12 hours in a single day at their “regular” rate, provided the average hours over the agreed-upon period do not exceed the set limits.
There are two primary types of arrangements under the Employment Standards Code (ESC):
- Hours of Work Averaging Agreements (HWAA): These can be entered into by an individual employee or a group of employees.
- Flexible Work Agreements (FWA): These focus on allowing employees to “bank” time off to be taken later, though they are less common than standard HWAAs.
How Hours are Averaged
Under an alberta averaging agreement, overtime is only triggered if you work more than:
- The daily hours scheduled in the agreement (if they are 8 or more).
- An average of 44 hours per week over the averaging period.
For example, if your agreement averages your hours over two weeks and you work 50 hours in Week 1 and 30 hours in Week 2, your average is 40 hours per week. In this scenario, you may not be entitled to any weekly overtime pay, even though you worked more than 44 hours in the first week.
What Makes an Averaging Agreement Valid?
An employer cannot simply declare that hours are being averaged. For an averaging agreement in Alberta to be legally enforceable, it must:
- Be in writing and signed by the employee (for individual HWAAs).
- Specify the start and end dates of the averaging period (maximum 52 weeks).
- Outline the schedule of daily and weekly hours.
- Be provided to the employee before the period begins.
Ending or Changing an Agreement
An averaging agreement in Alberta can’t be changed on a whim. Individual agreements typically require 2 weeks’ notice to cancel, unless both parties agree otherwise.
Get a Professional Review
Are you unsure if your alberta averaging agreement is legal? Many workers find themselves working long hours without the overtime pay they expect. The employment law team in Alberta at Samfiru Tumarkin LLP can review your contract and pay stubs to ensure you are being treated fairly under provincial law.