Overtime - Employers Cannot Contract Out

By Christina Kerby and Shannon Whyley, K.C.

A recent decision of the Saskatchewan Labour Relations Board (the “Board”) stands as an important reminder regarding employee entitlements pursuant to The Saskatchewan Employment Act (the “Act”): Employers cannot reduce employee rights pursuant to the Act by way of contract.

On March 4, 2026, the Board issued its decision in Dart Services v Waisman, 2026 SKLRB 16 wherein it dismissed the employer’s appeal and upheld a wage assessment in favour of the employee in the amount of $41,454.25 (relating to unpaid overtime based on the statutory minimum rate of 1.5 times the employee’s hourly wage).

The matter at issue was the validity of what the employer termed an “all-inclusive contract” – a contract that provided for a fixed rate of pay that includes overtime. There was no question that the employee had signed the contract. In this instance the employment agreement specified an hourly rate for trucking services, a separate hourly rate for shop services, no overtime on either hourly rate, and a bonus that was only available when pipe was being sold (an irregular occurrence, including months where almost nothing was received). Mr. Waisman was aware of the way in which his wages were calculated and that he was not being paid overtime based on the number of overtime hours he worked. The employer took the position that the bonus structure was in lieu of overtime.

The decision under appeal, made by an adjudicator pursuant to s. 2-75 of the Act, concluded that the agreement between the parties was unenforceable and void on the basis of non-compliance with the Act. The Board, in upholding the decision, noted that in order to uphold an alternate agreement, evidence is required to demonstrate that the agreement is more beneficial to the employee than the minimum payments required by the Act. In this case, the agreement at issue denied Mr. Waisman the benefit of overtime pay in the amount required by the Act because the bonus amounts did not exceed that which he would have received had he been paid at overtime rates.

Notably, the Board referred to a Saskatchewan Court of Appeal decision, DJB Transportation Services Inc. v Bolen, 2010 SKCA 50), for the principle “that the protections provided by the [The Labour Standards Act] had to be ‘adhered to’ regardless of the form of the contract”. Similarly, the more recent decision of Lepage Contracting Ltd. v McCutcheon, 2023 SKCA 83, “did not find that the Lepage agreement did not comply with the Act because it was all-inclusive, but because ‘it deprived the employee of paid vacation leave and easily accessible information’”.

Key Takeaways

The Dart Services decision is a notable reminder that employers cannot contract out of obligations pursuant to the Act. Contracts with employees must meet or exceed the minimal entitlements owing under the Act. When attempting to enter into these types of agreements it is wise for both parties, employer and employee, to seek legal counsel.