Canada Labour Code: Employee Rights

The Canada Labour Code is federal legislation governing labour relations, workplace health and safety, and employment standards in federally regulated workplaces. Its employment standards cover wages, working hours, vacation, protected leaves, termination and statutory severance.

It does not govern every workplace in Canada. Employees of banks, airlines, telecommunications companies and certain transportation businesses generally fall under federal employment standards. Most other employees are covered by provincial or territorial legislation.

If you have lost your job, the Code’s minimum payments may be only part of what you are owed. Read our guide to severance pay for federally regulated employees for the detailed termination rules, calculations and package considerations.

Reviewed by: Lior Samfiru, Employment Lawyer and National Co-Managing Partner

On This Page:

• 1. What the Code Covers
• 2. Who Is Federally Regulated?
• 3. Wages, Hours & Vacation
• 4. Sick Leave & Other Leaves
• 5. Termination & Severance
• 6. Unjust Dismissal
• 7. Complaints & Deadlines
• 8. What to Do Next
• 9. FAQs

What Does the Canada Labour Code Cover?

The Code has four parts, each dealing with a different area of federal workplace law:

• Part I — Industrial relations: Union representation, collective bargaining, strikes and lockouts.
• Part II — Occupational health and safety: Workplace safety obligations and protections.
• Part III — Employment standards: Minimum pay, hours, vacation, holidays, leaves and termination rights.
• Part IV — Administrative monetary penalties: Financial penalties for specified violations.

For employees with questions about their pay, time off or dismissal, Part III is usually the starting point. Your employment contract can provide greater benefits. Eligible non-unionized employees can also have termination rights beyond the Code’s minimums.

You can read the Canada Labour Code on the Government of Canada’s legislation website.

Who Is Covered by Federal Employment Standards?

Federal jurisdiction generally depends on the business or industry your employer operates in. Common examples include:

• Banks
• Airlines and certain airport operations
• Telecommunications and broadcasting
• Canada Post
• Interprovincial or international rail, trucking and bus transportation
• Certain shipping, port and marine operations
• Interprovincial or international pipelines
• Many federal Crown corporations

See our list of federally regulated employers and industries. A subsidiary, contractor or business serving a federal employer is not automatically federally regulated itself.

Does your province determine which law applies?

An employee of a federally regulated bank in Toronto generally falls under federal employment standards. The Ontario Employment Standards Act does not apply simply because the employee works in Ontario. The same distinction matters in Alberta and British Columbia.

What about federal government employees?

Working for the federal government is different from working for a federally regulated private-sector employer. The federal public service is generally covered by the Code’s health and safety provisions, but not Part III employment standards. Separate legislation and employment arrangements govern many public-service rights.

Canada Labour Code Rules for Wages, Hours and Vacation

Federal minimum wage

The federal minimum wage is $18.15 per hour, effective April 1, 2026. If the applicable provincial or territorial minimum wage is higher, the higher rate applies.

Read our federal minimum wage guide for rates and coverage.

Standard hours and overtime

Standard hours are generally eight hours a day and 40 hours a week. Eligible overtime is paid at least 1.5 times the regular hourly wage. Paid time off instead of overtime pay can be arranged where the legal requirements are met, at 1.5 hours off for each overtime hour.

Industry-specific rules, exemptions and approved scheduling arrangements can change how these standards apply. Your job duties and actual hours matter when assessing unpaid overtime.

Annual vacation and vacation pay

Minimum annual vacation increases with continuous service:

• After one year: Two weeks of vacation, with vacation pay of 4% of wages.
• After five consecutive years: Three weeks, with vacation pay of 6%.
• After 10 consecutive years: Four weeks, with vacation pay of 8%.

Your employer can provide more generous vacation benefits. The Code also provides general holiday entitlements, subject to the applicable rules.

Paid Sick Leave and Other Protected Leaves

Paid medical leave

Employees covered by these rules can earn up to 10 days of paid medical leave per year. The first three days are earned after an initial 30-day qualifying period. Further days accrue monthly under the Code’s rules. Unused days can carry forward, but count toward the next year’s 10-day maximum.

Personal and family-related leaves

The Code provides up to five days of personal leave each calendar year for qualifying reasons. The first three days are paid after three consecutive months of employment.

Other protected leaves include maternity, parental, compassionate care, critical illness, bereavement and medical leave. Their eligibility, duration and pay rules differ.

Job-protected leave and income replacement are separate questions. A right to take leave does not necessarily mean your employer must pay your salary throughout it. EI and disability benefits have their own requirements.

Termination and Severance Under the Canada Labour Code

When a federally regulated employer terminates an employee without cause, several different rights can matter:

• Termination notice or pay instead: After at least three months of continuous employment, individual notice requirements generally range from two to eight weeks, depending on service.
• Statutory severance: After at least 12 consecutive months, eligible employees receive the greater of two days’ wages per completed year of employment or five days’ wages. This is separate from individual termination notice or pay instead.
• Additional contractual or common-law rights: An employee’s full entitlement can exceed these statutory minimums.
• Unjust dismissal protection: Eligible employees may also be able to challenge the dismissal itself.

An employer’s calculation of Code minimums does not necessarily establish that its entire offer is fair. Your contract, age, service, position, compensation and prospects of finding comparable work can affect a common-law assessment.

Already have an offer? Have your severance package reviewed before signing a release.

What if your employer alleges cause?

An employer’s allegation does not establish that just cause exists. Have the facts assessed before accepting that you are owed nothing. Read our guide to termination for cause.

What Is Unjust Dismissal Under the Canada Labour Code?

Unjust dismissal is a federal complaint process that lets eligible employees challenge an unfair dismissal. It can provide remedies beyond payment of termination minimums, including reinstatement and compensation.

Eligibility generally requires at least 12 consecutive months with the employer, no collective agreement and a non-managerial role. Statutory exclusions also matter, including dismissals because of lack of work or discontinuance of a function.

The normal filing deadline is 90 days from dismissal. Negotiating severance or pursuing an internal appeal does not automatically extend that deadline.

Learn about eligibility, exclusions and remedies in our Unjust Dismissal guide.

How Do You Make a Canada Labour Code Complaint?

The federal Labour Program handles employment standards complaints, including unpaid compensation and certain non-monetary violations. The process and filing deadline depend on the issue.

• Monetary complaints: Normally within six months of the last date the employer was required to pay the amount.
• Non-monetary complaints: Normally within six months of becoming aware of the issue.
• Unjust dismissal complaints: Normally within 90 days of dismissal.

Health and safety matters, reprisals and other disputes can follow different procedures. A Labour Program complaint is not a substitute for assessing any separate civil claim or full severance entitlement. Get advice about the appropriate process before choosing a route.

See the government’s labour standards complaint eligibility and deadlines.

What Should Federally Regulated Employees Do Next?

1. Confirm which law applies. Identify your employer’s business and whether you are covered by a collective agreement.
2. Save your records. Keep your contract, pay statements, schedules, leave correspondence and any termination documents.
3. Identify the deadline. Do not assume a wage complaint and a dismissal complaint have the same filing period.
4. Review an offer before accepting. Code minimums may not reflect your complete termination rights.
5. Get advice before resigning over major changes. A significant pay cut, demotion or other fundamental change can raise constructive dismissal issues.

Canada Labour Code FAQs

Does the Canada Labour Code apply to everyone in Canada?

No. Most employees fall under provincial or territorial employment standards. The Code applies to specified federal workplaces, and its different parts do not all cover the same employers.

Are bank employees federally regulated?

Employees of federally regulated banks generally fall under federal employment standards. If you work for a related company rather than the bank itself, confirm that company’s jurisdiction.

Can your contract reduce your Code rights?

An employer cannot use a contract to remove applicable statutory minimum protections. Whether a contract validly limits additional common-law rights is a separate question that requires review.

Is statutory severance the full amount you are owed?

Not necessarily. Eligible non-unionized employees can have rights beyond the statutory payments. Read our federal severance guide before treating the minimum calculation as your complete entitlement.

Can an employer dismiss you without cause simply by paying severance?

Paying termination compensation does not automatically resolve unjust dismissal rights. An eligible employee may still challenge the dismissal. The employee’s role, service and the reason for dismissal matter.