Quebec, Canada – Leave Bank Errors: Can An Employer Correct Them Years Later?

A recent Quebec arbitration decision provides important guidance on an issue that occasionally arises in the workplace: when an employer discovers that an employee received a benefit to which they were not entitled, is the employer barred from taking action by the six-month prescription period set out in the Quebec Labour Code? The answer is not always what one might expect.

The Facts in Brief

The underlying case arose from an employer’s synchronization problem between internal systems that prevented certain employee absences from being deducted from vacation and sick leave banks. As a result, leave balances were artificially inflated for several years. Once the issue was discovered in 2024, the employer adjusted the affected leave banks.