How Does Vacation Pay Work In Canada?

A question that I get asked often by business owners who are hiring their first employee is: how does vacation pay work? Does it get paid out? Do I have to do it? Short answer is yes, all Canadian employers are required to pay at least two weeks of vacation for “every completed year of employment,” CRA. What’s a completed year? It’s twelve consecutive months from the start date of employment. If you hire someone on February 18th, 2021, you will be required to start paying or giving paid time off on February 19, 2022 .