How to add statutory holiday pay in QuickBooks Online Payroll

In this article, we'll walk you through the process of adding statutory holiday pay in QuickBooks Online Payroll. You will learn:

• Which statutory holidays already turned on in QuickBooks Online
• How to check if statutory holiday pay is enabled for your employee
• Types of statutory holidays
• How to enter Stat pay - Average daily wage
• How to enter Stat holiday pay
• Provincial employment standards
• Frequently asked questions about stat pay changes

Statutory holidays already turned on in QuickBooks Online

Statutory holiday pay is mandatory in Canada, so we've automatically turned the pay type on for you.

Below are the common statutory holidays in Canada:

Check if statutory holiday pay is enabled for your employee

Statutory holiday pay is automatically enabled for all employees.

Follow the steps below to confirm that the pay is turned on for your employee:

1. Navigate to Payroll, then select Employees.
2. Select the employee by choosing their name.
3. Select the edit icon in the Pay types box and confirm that Stat pay - Average daily wage and Stat holiday pay are enabled.
4. Select Save.

When you run payroll, the statutory holiday pay columns will be displayed. You'll be able to input the applicable holiday hours for Stat holiday pay and a dollar amount for the Stat pay - Average daily wage into the statutory holiday fields to generate the appropriate pay.

Types of statutory holidays

Stat pay is split into two columns: Stat holiday pay for when an employee has worked on the stat holiday and the Stat pay - Average daily wage for all employees that didn't work on the stat holiday.

Stat holiday pay

Employees required to work on a stat holiday are usually entitled to premium pay. The specific regulations can vary by province, but generally, an employee that works on a stat holiday is paid time-and-a-half of their wage rate for every hour worked.

For example, in Ontario, premium pay is 1½ times an employee's regular rate of pay. If an employee is entitled to receive premium pay for work on a statutory holiday, they must be paid 1½ times their regular rate of pay for each hour worked.

For more details on how to calculate stat pay for employees that were required to work, refer to the Employment Standards Act for your province below.

Stat pay - Average daily wage

This pay is typically based on ‌average earnings over a period of time before the statutory holiday. The specific regulations can vary by province, but in general, to be eligible for statutory holiday pay an employee must have been employed for at least 30 calendar days before the stat holiday and they must have worked or earned wages on at least 15 of the 30 days immediately preceding the statutory holiday.

For example, in Ontario, stat pay is calculated by taking all of the wages earned by the employee in the 4 work weeks prior to the holiday and dividing the total by 20. This gives you the Stat pay - Average daily wage dollar amount.

For more details on how to calculate stat pay, refer to the Employment Standards Act for your province below.

How to enter Stat pay - Average daily wage

Stat pay - Average daily wage is entered as a dollar amount in QuickBooks Online Payroll. Since each province has different regulations on how to calculate stat pay, you will need to visit your province's Employment Standards Act website to determine how stat pay is calculated in your province.

1. Visit your province's website linked from the table below to calculate the Stat pay amount for your employees.
2. In QuickBooks Online, select Payroll, then select Overview.
3. Select Run payroll.
4. Select the pay schedule.
5. Enter the dollar amount that you calculate for your employee in the Stat pay - Average daily wage column.

How to enter Stat holiday pay

Stat holiday pay is based on the number of hours your employee worked on a stat holiday:

1. In QuickBooks Online, select Payroll, then select Overview.
2. Select Run payroll.
3. Select the pay schedule.
4. Enter the number of hours in the Stat pay holiday column.

Provincial employment standards

Frequently asked questions

Why was there a change to the stat pay columns?

On November 7, 2023, we made a change to the statutory holiday pay feature. This introduced a new column to allow for the ability to enter statutory holiday pay as a dollar amount in addition to tracking statutory holiday pay hours at a premium rate (for example, time-and-a-half). This was rolled out to help support the varying labour standards regarding statutory holiday pay across provinces.

We received valuable feedback indicating that some of our customers may prefer to use the original form of the Statutory Holiday Pay type for their existing workflows.

What are we doing to address the feedback?

On December 5, 2023, we made the following updates to the Statutory holiday pay type:

This Statutory Holiday Pay type will now behave as it did prior to November 7th. While we have restored this pay type back to its original form, we will also continue to support the new average daily wage pay type. These options will now provide you with more flexibility and control to calculate statutory holiday pay in the best method for your specific business needs.

What should I do if I have used the new stat pay columns?

If you have used the new Stat pay columns between November 7th and December 4th, revert to the workflow you have used prior to this change.

If you didn't use the new columns, you may continue as you have in the past. Note that T4/RL1s will be correct, given that they both report to the same box number.

Will my T4s be affected if I have used the new stat pay columns?

No, your year-to-date amounts won't be affected on the T4, as both the hourly premium and average daily wage columns feed into box 14 on the T4.

What do I do if I have used the new Stat pay column and have overpaid my employee?

If you used the hourly premium column and have overpaid your employee, you will need to communicate with them and decide a course of action. You can either work with your employee to recover the overpaid amount, or deduct the overpayment from their next paycheque.

Will my ROE be affected if I have used the new stat pay columns?

If you used the average daily wage column, your insurable hours will be affected, as average daily wage currently does not track hours. If you are creating a ROE for an employee, make sure to double-check that the insurable hours are correct on the ROE. If you need assistance with editing your paycheques, refer to our support article on How to edit paycheques.

If you used the hourly premium column, your insurable hours will not be affected.