Challenging Incorrect Overtime Compensation
What to do when your employer underpays overtime or offers 1:1 time in lieu.
Content last verified against official statutes: March 30, 2026
Context and Setup
You have been working an average of 5 hours of overtime per week for the past six months. Your employer's practice is to give time off in lieu at a 1:1 ratio (1 hour worked = 1 hour off) rather than the legally required 1.5:1 ratio. You have reviewed your pay stubs and calculated the shortfall. You are raising this with your manager first, with a plan to escalate to the Labour Program if necessary.
The Conversation
You
I want to discuss how my overtime is being compensated. I have reviewed the Canada Labour Code and my pay records, and I believe there is a discrepancy.
Start neutral and factual. You are presenting an observation, not making an accusation.
Manager
What do you mean? We give you time off for every hour of OT.
You
Under CLC s.174, overtime must be compensated at 1.5 times the regular rate, whether paid in wages or time off in lieu. For every 1 hour of overtime, I am owed 1.5 hours of time off. The current practice of 1:1 creates a shortfall of 0.5 hours per overtime hour worked.
Cite the specific section. Present the math. This is not a matter of opinion.
Manager
That is the company policy. Everyone gets 1:1.
You
I understand that may be the practice, but the CLC sets the minimum standard. Any company policy that falls below the CLC minimum is not enforceable. Over the past six months, I have worked approximately 130 hours of overtime and received 130 hours of time off. I should have received 195 hours. That is a shortfall of 65 hours.
The specific calculation makes this concrete. It also shows you have done your homework and have documentation to support the claim.
Manager
I will need to check with HR on this.
You
I would appreciate that. Could you please confirm the outcome to me in writing? I would like to resolve this internally if possible. For reference, the CLC allows recovery of unpaid overtime going back 36 months.
Mentioning the 36-month window signals you are aware of your full recovery rights without being threatening. Requesting a written response creates a record.
What to Document After
- Date and time of the conversation.
- Manager's response, especially the statement that 1:1 is company policy.
- Your calculated shortfall with supporting pay records.
- Follow-up email: "Following up on our conversation today about overtime compensation. Under CLC s.174, overtime time off in lieu must be calculated at 1.5 hours for each overtime hour. Based on my records for the past [X months], I have a shortfall of [X hours]. I look forward to your response on how this will be resolved."
- Keep copies of all pay stubs, timesheets, and any schedule or time-tracking records.
Escalation Options
Key Statutes
When Should You Contact a Lawyer?
This platform is designed to help you build your case independently — collecting evidence, documenting incidents, writing complaints in compliance language, and navigating the internal HR process. Many employees can handle these steps without a lawyer.
The most effective time to engage a lawyer is after you have completed the internal process and your employer has failed to resolve your complaint. At that point, a lawyer can review your complete file — your timeline, evidence, complaint, and the employer's response — and provide strategic advice before you file with an external body such as the CIRB, CHRC, or OPC.
By doing the groundwork yourself, your consultation becomes a focused strategic review rather than a costly fact-gathering session. This approach has been validated by employment lawyers who reviewed files prepared using this methodology and found the documentation thorough with nothing to add.
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Cite This Page
MyWorkRights.ca, "Challenging Incorrect Overtime Compensation," accessed 2026-04-01, https://myworkrights.ca/scenarios/overtime-dispute
Written by the MyWorkRights.ca team, based on direct experience navigating the CIRB, OPC, and CHRC complaint processes and 500+ hours of employment law research.