Canada Employer of Record

Canada Employer of Record

If a lack of speed or local expertise are among your top concerns when expanding to or employing workers in Canada, an employer of record may be the best option for achieving your global growth objectives.

An employer of record, sometimes known as an international PEO, enables you to quickly hire and onboard workers in Canada―often in as little as two weeks―without having to take on the cost and risk of establishing a local entity.

Learn about the hiring, employment, payroll and benefits requirements for workers in Canada and how our employer of record service, Global Employment Outsourcing (GEO), and local HR experts can help you manage your international employment needs.

Hiring in Canada

Under the Canadian Constitution, each province and territory in Canada has its own labor laws that protect most of the workforce. Except for unemployment insurance and public pension benefits, which are federal programs, the federal government cannot regulate employers under provincial jurisdiction. Some industries, such as international shipping, telecommunications and airlines, fall under federal jurisdiction.

Navigating provincial and federal employment laws in Canada can make HR compliance a challenge for many global employers. As your employer of record and PEO in Canada, we can ensure that every contract, for every worker, meets all requirements. We can also provide you with guidance about cultural norms and hiring best practices and keep you up-to-date with employment regulations as they change.

Employment contracts in Canada

As you look to hire employees in Canada, here are some common regulations you’ll need to know to create a compliant contract, as well as how an employer of record and PEO can provide support for your unique HR needs. Working hours The average workday in Canada is eight hours, and the standard workweek is 40 hours with a maximum of 48. Every province in Canada and the federal government require one day of rest per seven-day period and an extended break period between work shifts, typically eight to 13 hours. Compensation As you consider the appropriate salary to offer your Canadian employees, keep in mind:
  • Minimum wage requirements vary across Canada and are regulated by provincial employment law.
  • The minimum wage for federally regulated employees is $15 per hour as of December 29, 2021.
  • For employees required to work more than a 40-hour workweek, overtime pay is typically time and a half, with a maximum of eight overtime hours per week. 
As your employer of record in Canada we can provide you with resources and insights about employee compensation, so you are better equipped to make a competitive employment offer. Bonuses Bonus payments are not required under Canadian law, but they are often included in employment contracts and are commonly used to negotiate with top candidates. Probationary period Employment probationary periods in Canada are generally three months and can be up to six months in some provinces. Severance may be required if an employee is terminated prior to the end of the probationary period. Termination and severance Canadian law does not recognize at-will employment. Employees who are terminated must be notified two weeks prior to the end of employment or paid in lieu of notice, unless the employee is terminated due to cause. Notice periods and the amount of pay in lieu of notice are frequently higher under provincial law. Additionally, employees who worked for an employer for more than 12 months must be paid two days for each year they worked, with a minimum of five days of pay, provided they were not terminated for cause. All employees, regardless of reason for termination, must be paid vacation owed. As your employer of record in Canada, we can work with you to quickly handle the unforeseen event of an employee termination, providing legal guidance and a personalized process that ensures you stay out of labor court.

Employee benefits and paid leave in Canada

When negotiating terms of an employment contract with a candidate in Canada, here are some of the statutory benefits and paid leave requirements to keep in mind, as well as how an employer of record can support your company’s benefits strategy.

Maternity leave
Pregnant employees in Canada are entitled to up to 17 weeks of maternity leave. Unpaid parental leave is also available for employees, up to 63 weeks in some provinces.

Employers are not required to make payments to employees or pay for benefits during maternity leave. However, employees may be eligible for pay and benefits under the federal Employment Insurance Act.

In most provinces, employees are entitled to at least two weeks of paid vacation after one year of service.

Employees in federally regulated industries are entitled to two weeks of paid vacation after five years of service, three weeks of vacation after six years, and four weeks of vacation after 10 years of service. Vacation pay is equal to 4% of employee earnings for the year when the vacation is due, with an increase depending on the total years of service.

Nine holidays are observed nationwide in Canada and are generally treated as paid leave for employees:

  • New Year’s Day
  • Good Friday
  • Victoria Day
  • Canada Day
  • Labour Day
  • Thanksgiving Day
  • Remembrance Day
  • Christmas Day
  • Boxing Day

There are also several provincial holidays observed in Canada.

Generally, employees required to work on a holiday are entitled to to either a paid replacement holiday or their regular rate of pay plus holiday pay equal to at least one sixtieth of what they earned in the 12-week period prior to the week when the holiday occurs.

Sick leave
Each province has its own laws governing sick leave, but all offer at least three days per year. These laws offer employment protection, but sick leave is generally unpaid in Canada. In certain cases of long-term illness, employees may qualify for compensation under the Canada Pension Plan or Employment Insurance.

Health coverage
The Canadian social security system provides basic universal health care, which covers most medical situations. However, employers often offer additional plans to cover medical needs like prescriptions, dental care and ambulance services.

As your employer of record in Canada, we may be able to provide optional supplementary medical insurance coverage for professionals and their dependents at a more cost-effective rate.

Additional benefits
In addition to medical care, Canada offers benefits such as workers’ compensation and retirement. The availability and cost of these benefits varies between provinces.

We can consult with you about supplemental benefits coverage options for your employees in Canada, such as disability or life insurance, if needed.

Employee onboarding with an employer of record in Canada

We write and validate all local employment contracts, streamlining the onboarding process for you and your Canadian employees—all you have to do is provide relevant information and review and approve the employment agreement.

As your employer of record in Canada, we will:

  • Schedule a welcome call to discuss HR and employment information for Canada, as well as answer any questions 
  • Prepare a customized employment contract in English and in French (or other local language)
  • Share the employment contract and benefits information with the new employee for signature and review
  • Gather tax and banking information from the employee to set up payroll 
  • Provide a local point of contact to the employee to answer any questions regarding their employment, local HR or payroll

The entire onboarding process for the employee can often be completed in as little as two weeks.

Partner with Safeguard Global as your Canada employer of record and PEO

With over a decade of service, we are the longest-serving employer of record and PEO provider in the international market. Organizations around the world rely on Global Employment Outsourcing (GEO) to expand and hire in over 179 countries around the world, quickly and compliantly. We’ve seen just about every global employment circumstance imaginable—and with our extensive knowledge of local law and culture, we know what it takes to get employment right in Canada. We provide written contracts in the local language, salaries in the local currency and HR support in your employees’ time zone. Additionally, as a global payroll provider we support payroll administration—including payments, filings and other calculations—in more than 150 countries and can accommodate the payroll outsourcing needs of any size organization. Whether you’re looking to hire as part of a strategic expansion or to meet specific talent needs, our global solutions advisors can walk you through your international hiring options so you can make the right choice for your organization. Contact us today.

The information provided on or through this website is for informational purposes only and does not constitute legal advice. Safeguard Global expressly disclaims any liability with respect to warranty or representation concerning the information contained herein, including the lost essence, interpretation, accuracy and/or completeness of the information in transit and language translation.

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