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What to Expect from Canadian Employer of Record Services

Posted by Corinne Camara

|

Feb 23, 2018 9:00:00 AM

What_to_Expect_from_Canadian_Employer_of_Record_Services.jpgDo you employ people in Canada but have your head offices located in another country? Maybe you’ve hired some temporary or contract workers to complete projects for you. Whatever the situation, you may be wondering about Canadian employer of record services for your business.

Download our free guide on what US companies need to know about paying  employees in Canada.


What Is an Employer of Record?

When you hire workers in another country, you may not want to be responsible for them—you want the work to be completed, but you don’t want to have to deal with hiring, termination, payroll, taxes, or any HR compliance. You don’t want to worry about a new country’s tax code or employment standards.  

Of course, someone has to be responsible for issuing payment, withholding taxes, and so on. Someone must be listed as the employer. An employer of record provides this service to you. They’re listed with the Canada Revenue Agency as the workers’ employer, hence the name “employer of record.”


What’s the Difference between an EOR and a Staffing Firm?

Some people believe employers of record are the same as staffing firms. While they may be similar or offer similar services, there are some key differences between these organizations.

A staffing firm will hire and place employees with your business. They may include employer of record services as part of their client offerings, but not always. In Canada, these services don’t need to be offered by a staffing firm. The two are different businesses entities, although employers of record often work with staffing firms.


What Can You Expect?

If you’re interested in Canadian employer of record services, you may be wondering what you can expect and why you’d choose these services over another option.

Canadian employers of record provide comprehensive payroll and HR services for your business. They act as the legal employer of the workers, taking the load off your in-house team. This is particularly useful for employers who hire employees on a temporary basis or hire workers in different jurisdictions.

These services allow another entity to act as the legal employer to your Canadian employees. They handle payroll, including taxes and withholdings, the calculation of vacation time and pay, and so on. They won’t, however, handle the day-to-day management of your workers.


Work with an EOR

Canadian employers of record handle everything you’d need to, without you needing to worry about the ins and outs of Canadian payroll or varying legislation in different provinces. Since the employee technically isn’t yours, someone else is legally responsible.

They’re also a great option whether you work with a staffing firm or not. If you’ve been wondering how you can minimize the burden on your payroll and HR team while ensuring you stay compliant in a new jurisdiction, consider Canadian employer of record services for your business. It could just be the right solution.


What US Companies Need to Know about Paying Employees in Canada

Topics: Employer of Record

Learn How to Pay International Employees and Avoid These 3 Mistakes

Posted by Karen McMullen

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Feb 21, 2018 9:00:00 AM

Learn_How_to_Pay_International_Employees_and_Avoid_These_3_Mistakes.jpgIt’s an exciting time in your growing business! You’re moving beyond borders, becoming a truly global entity. One of your next stops is Canada.

As much as this is exciting, it can also be a stressful and busy time. One of the most important things you’ll need to do will be to staff your new locations. This means hiring and training. Once your new hires are onboarded, you’ll also need to pay them.

Download our free guide on what US companies need to know about paying  employees in Canada.

Paying international employees can be fraught with confusion, especially if you’re entering this new jurisdiction for the first time. Even those who have been operating for a while may bump into these common mistakes when it comes to how to pay international employees.

Use these handy tips to avoid rookie mistakes and learn how to pay international employees.


1. Ignoring Exchange Rates

An American firm pays its employees in US dollars and its workers are likely quite happy with that arrangement. Many Canadian workers would also be happy to receive their wages in US funds, provided the US dollar is valued higher than Canadian currency at the time of payment. Neither Canadian nor American workers would likely prefer to be paid in Mexican pesos, however, so you’ll want to decide what currency to use when you decide how to pay international employees.

Some employers will want to pay Canadian workers in Canadian dollars. While this is well and fine, it can make a fine mess of things as exchange rates shift up and down over time. Your workers may earn the same amount each and every month, but an American company will see its costs go up and down with the exchange rate. Your employee’s salary could cost you a different amount each month.

What can you do instead? One easy option is to pay workers in US dollars. Another is to maintain separate accounts for Canadian and American currencies. A third option, and often the best solution, is to work with a PEO to smooth out the wrinkles.


2. Varying Laws

You may think you only need to learn Canadian federal law when it comes to employment, payroll, and taxes. This is, unfortunately, not true. Only about 10 percent of Canadian workers are actually subject to federal laws on the subject. Everyone else is subject to provincial law.

The laws vary across provinces. Even if you learn Ontario law backwards and forwards, you’ll still struggle when you try to pay your employees in BC and Manitoba. You can’t just adopt the rules and regulations of one province and apply them to employees working and living in another.

The best bet here is to work with a Canadian PEO. They can help you stay in step with provincial law across all 10 provinces and the three territories. It won’t matter if you operate in three or four different jurisdictions. The PEO is an expert and can handle the challenge.


3. Not Keeping Good Records

Different countries also have different standards when it comes to recordkeeping. You may not keep certain files or forms. It may not be legal in your country to collect certain kinds of data. The opposite is also true; the new country you’re entering may have a strict policy about the collection of personal data. Your standard forms just aren’t going to cut it.

You may be tempted to skip the record-keeping portion of payroll or declare your own forms and data collection “good enough.” This can land you in serious trouble. In Canada, the CRA can actually put you in jail for failure to comply with record-keeping standards.

Again, a PEO is your best bet when it comes to managing your records about how to pay international employees. They can help you make paying your international employees a breeze, without the administrative headache.


12 Things an American Company Looking to Hire a Worker in Canada Needs to Know

Topics: Payroll Processing

4 Signs Your Company Needs Employer of Record Services

Posted by Stacey Duggan

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Feb 19, 2018 9:00:00 AM

4_Signs_Your_Company_Needs_Employer_of_Record_Services.jpgEmployer of record services have been growing in popularity in recent years. As the size of the contingent workforce has grown, and more businesses and industries have adopted contingent working arrangements, the need for these services has also grown.

The contingent workforce is predicted to keep growing into the future, which means EOR services aren’t going anywhere any time soon. In fact, you might be looking at adopting them for your business in the near future. You may even need these services right now!

Download our free guide on what US companies need to know about paying  employees in Canada.

How can you tell if you need to adopt employer of record services in your business? These four signs may provide some clues.


1. You’re Hiring Many New Contractors

Until recently, most companies used part-time and full-time permanent working arrangements. You’d hire an employee and they’d stay with you until you let them go or they quit. If you didn’t need another person working 40 hours a week, you may have hired someone part-time versus full-time, but that was about as much flexibility as you had.

Now, you have a choice of many different options, all designed to give you much more flexibility. Seasonal, temporary, and contract workers have all become much more popular. Today’s business environment demands organizations be nimble, and a contingent workforce helps you navigate this environment more easily.

If you’ve recently started hiring contractors or you’ve hired quite a few of them, you may find you don’t have the resources to manage them properly. In this case, employer of record services could be just what you need.


2. You Don’t Know the Legislation

Are you expanding your operations into Canada?

This situation can quickly become confusing. How well do you know the legislation in Canada? You may be surprised by the number of differences between Quebec and Ontario! Foreign firms have a large challenge ahead of them. The Canadian payroll and taxation system is quite different from that of the US or the UK. Add in the fact that legislation changes between provinces and territories, and you have a recipe for trouble.

Employer of record services help you avoid any trouble with the Canada Revenue Agency. Since the service provider handles everything to do with payroll, you don’t need to worry the CRA is going to come knocking on your door about a tax error you didn’t even know was an error.


3. Your HR Department Is Overwhelmed

Whether it’s because you’ve suddenly expanded your contingent workforce or because you’re operating in many new jurisdictions, you just don’t have the HR personnel to keep up with payroll and taxes any longer. Your people are constantly run off their feet.

What should you do? Hiring is one option, but you’re not sure your budget can take it. Take some of the load off by getting employer of record services. These services are often a more economical solution than hiring more staffers for the HR department. It allows your team to focus on their core tasks, rather than trying to learn Canadian tax legislation and Saskatchewan vacation time rules inside out.


4. You’re Concerned about Compliance

Maybe you’re operating in a new jurisdiction. Maybe you’ve had a tax audit in the past.

Whatever the reason, you want to make sure you’re compliant. Employer of record services make it easy!

If you see these signs in your business, consider employer of record services as a solution. Talk to a provider today and discover how they can help you run your business more effectively and efficiently by taking over the legal management of your employees.


What US Companies Need to Know about Paying Employees in Canada

Topics: Employer of Record

Expand Your US Business with Payroll Services in Canada

Posted by Corinne Camara

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Feb 16, 2018 9:00:00 AM

Expand_Your_US_Business_with_Payroll_Services_in_Canada.jpgThe Canadian economy has seen steady growth in recent years, with 2017’s 3.1 percent followed up by a still considerable 2.2 percent this year. Now is perhaps one of the most promising times to think about expanding your US business across the border. Before you proceed to make your brand’s name known in Canada, however, you need to ask yourself one key question: do you have the right infrastructure?

Download our free guide on what US companies need to know about paying  employees in Canada.

Yes, there are similarities between US and Canada regarding culture and trade agreements, but your business will be off to a bad start if it disregards the variances in legislation for operating in Canada. In order to be a successful US branch in the north, you’ll need to consider opting for payroll services in Canada.

How important is obtaining payroll services in Canada for your business expansion? Read on to learn how proficient payroll services can make your expansion all but seamless.


Payroll Isn’t Just about the Pay

We know that sounds counterintuitive, but it’s true; having successful payroll services in Canada isn’t just about printing and distributing your employees’ paycheques on time. You need to ensure your business is registered as a Canadian company, and you must open and maintain all necessary accounts for operating lawfully.

You’ll need at least a banking account, a CRA account (for payroll and tax deductions), Worker’s Compensation program to protect your employees if they are made financially vulnerable from work-injuries or occupational illness, and an account with the Ministry of Labour.

In addition to this, you’ll need to consider that some of these accounts will be subject to different legislation depending on what province or territory you want to expand into. Before you can even think about hiring employees, you need to establish a Canadian administrative presence first. Those who specialize in payroll services can streamline this process for you, allowing you to concentrate on your expansion strategy instead.


Onboard Employees According to Standards

Hiring your first Canadian employees comes with many responsibilities, all of which can’t be put off to a later date. You must conduct employment negotiations regarding duties and compensation, draw up and get signatures for several agreements, and put together satisfactory compensation packages for candidates.

Now is the time in your expansion process that you should pay special attention to compliance for minimum wages and ensure that important forms for tax remittance (like a new hire’s TD1) are filled out. You can’t afford to make mistakes that can lead to non-compliant employment standards. Misclassifying your employees as independent contractors, for instance, can lead to monetary penalties and brand-ruining prosecution.

The right payroll services processor will also be an employer of record and act as the legal employer to your employees, deftly handling all the ins and outs of hiring, managing, and paying Canadian employees so you can focus on your core business activities.


Thorough Payroll Management

The best payroll services in Canada help with your US business expansion from the ground up. When you have an administrative authority that can handle both your HR and the compliance factors of your payroll, benefits, taxes, and more, opening a Canadian branch is simple. You don’t need to fuss about T4s, ROEs, paystubs, and employment verification paperwork because payroll services act as an integrated part of your daily operations.

Fully compliant remittances, payroll data reviews, and management of invoices and paycheques are just a few of the ways that payroll services keep your business all squared with the Canadian government.

Keep in mind, this is just the tip of the iceberg when operating a business branch in Canada. If you want to learn more about how best to pay a worker in Canada, you should consider discussing the matter with payroll services experts today. You might find that partnering with such experts is the key to growing your business in the north.


What US Companies Need to Know about Paying Employees in Canada

3 Tips for Finding Dependable Payroll Services

Posted by Shannon Dowdall

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Feb 14, 2018 9:00:00 AM

3_Tips_for_Finding_Dependable_Payroll_Services-1.jpgAs a U.S. or international company that’s seeking to expand business into the Canadian market, many challenges arise when looking for dependable payroll services. For American employers, the Canadian market seems so similar to the U.S. that businesses often fall short of getting all the help they need. For international employers, Canada’s ever-evolving compliance can lead to high costs for both their financial resources and reputation.

Download our free guide on what US companies need to know about paying  employees in Canada.

Finding dependable payroll services is more than just finding someone to outsource your payroll responsibilities to. In truth, the search is also about landing a payroll service provider that can help keep your foreign company abreast of any changes to Canadian business legislation—changes that could affect the growth of your business.

With the above in mind, check out below for our top three tips for finding dependable payroll services.


1. Is the Payroll Provider an Employer of Record?

The first question you need to answer to determine if you’ve found the right payroll services processor is whether they are an employer of record (EOR) or not. An EOR doesn’t just process payroll data and print cheques to order, they take over the legal responsibility of your employees—and the risks that come with that designation.

An EOR will be capable of both properly hiring and onboarding your Canadian employees, as well as ensuring your federal and provincial compliance is in order. EORs can also help you register and maintain all necessary accounts for operating a Canadian business, establish your financial infrastructure, and keep your workplace standards up to date.

Running a business in Canada isn’t as simple as opening up a branch and continuing on with your status quo. You need to become an expert in Canadian employment and taxation regulations. A payroll processor that is also an EOR will integrate with your daily operations, making managing Canadian employees simple and easy.


2. Is the Provider a Canadian Authority?

Dealing with Canadian compliance can become increasingly thorny when you don’t have a payroll services processor that can navigate the intricacies of business legislation, especially when it comes to handling official issues or queries with the Canadian government.

There’s a lot of information out there regarding proper employment practices in Canada, including what the employees’ rights are, how their benefits package should be managed, and what their wages should be. Now, take into consideration that all this information will vary from province to province and territory to territory.

Ontario, for instance, has just updated and revised its Employment Standards Act, changing standards for benefits, leave and vacation pay, the minimum wage, and more. The Fair Workplaces, Better Jobs Act, which was passed as of November 2017, has changed the game for all employers in the province whether they are local or foreign.

Your payroll processor should be a recognized authority by the Canadian government. Not only will such a processor maintain ongoing compliance, it will be capable of maintaining your credibility and great reputation as a Canadian business.


3. Demystify Cultural Variances

Finding dependable payroll services is really about finding a payroll processor that can make sense of all the cultural variances between your U.S. or international business and Canadian businesses. You need a processor that isn’t just a business you outsource the automated printing of your cheques to.

You’ll want a processor that reviews all the payroll data before those cheques are printed. A proficient processor will help you avoid any mistakes that could cost you in fines and a sullied reputation as a Canadian branch of your U.S. or international business.

Some of the best processors even have cloud-based systems to streamline payroll management, allowing you to track and review all payroll data before you send it off to be double-checked and processed.

You leave many things to chance handling payroll on your own. Landing a dependable partner for outsourcing payroll processing will ensure your Canadian business branch thrives.


7 Signs It's Time to Outsource Payroll

Topics: Payroll Processing

What Canadian Payroll Rules Do You Need to Know?

Posted by Ray Gonder

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Feb 12, 2018 9:00:00 AM

What_Canadian_Payroll_Rules_Do_You_Need_to_Know.jpgDespite Canada and the U.S. being very similar with respect to culture and economics in some regards, operating as a foreign business across the border comes with many unforeseen challenges. Perhaps one of the biggest challenges, other than registering as a Canadian business and establishing an administrative presence, is following the country’s complex payroll rules.

Download our free guide on what US companies need to know about paying  employees in Canada.

Canada requires foreign businesses, whether U.S. or international, to follow all Canadian payroll rules. While this requirement might not sound daunting at the outset, consider the following: Canada’s employment standards are constantly evolving and vary on both the provincial and federal levels. What might be the status quo in Québec, for instance, is not so in Ontario.

With little room for error if you fail to make proper government remittances or pay the right minimum wages, your business’ success rests on making Canadian compliance a priority. One way you can do that is by learning what Canadian payroll rules are the most important to know.


Minimum Wages

You are required to pay your Canadian employees at least the minimum wage according to their province or territory. Many occupations in Canada have an hourly wage, but there are some exceptions, such as independent contractors who are paid on a project-to-project basis. The minimum wage is also affected by whether you’re hiring students as well as by the type of work being performed.

For instance, in November 2017, updates were made to Ontario’s pay rules with the passing of the Fair Workplaces, Better Jobs act. Ontario employers are now required to pay a minimum wage of $14.00 to most employees, with the rate scheduled to go up to $15 next year. Students and other special minimum wage workers, such as those who serve alcohol, have different minimum rates, which will increase by the same percentage as the general minimum wage over time.


Tax Deductions

When you hire employees, making the proper deductions from their payroll is crucial. You’ll need to make certain they’ve given you their Social Insurance Numbers (SIN) and their TD1 forms. A TD1 is the form that will help you determine how much tax needs to be deducted from your employees’ employment income. Other deductions include, but are not limited to:


  • Canada Pension Plan (CPP)
  • Employment Insurance (EI)


As with many Canadian payroll rules, how a TD1 is filed varies in different provinces. Québec is the most notable example, in which employees must use both a federal TD1 and a provincial form called a TP-1015.3-V. Source Deductions Return.

You must make regular government remittances on time for these deductions. Failure to remit or late remittances will result in steep monetary penalties, with additional penalties and interest if you are knowingly avoiding remittances.


Proper Classification of Workers

The definition of an employee versus an independent contractor is also part of Canadian payroll rules. An employee in Canada is entitled to vacation pay, public holiday pay, overtime pay, termination pay, severance pay, and benefits, as well as income deductions for taxes, EI, and CPP. An independent contractor is considered self-employed and therefore not entitled to the same benefits as an employee. You also don’t have to worry about deductions.

Willfully misclassifying your workers in order to avoid having to deal with employee costs is illegal and can result in monetary penalties, prosecution, and public disclosure of your prosecution—none of which, I’m sure you know, is great for your brand’s expansion into Canada. So, make sure you know what defines a worker as an employee or an independent contractor.

While it’s great to have working knowledge of how payroll rules work in Canada, all the variances between provinces can become overwhelming. There’s a lot of contradictory information, which can prevent you from maintaining ongoing compliance.

You shouldn’t leave things to chance handling payroll on your own. An employer of record can make sense of even the most convoluted tax legislation and pay employees for you.


12 Things an American Company Looking to Hire a Worker in Canada Needs to Know

Topics: Compliance

How to Establish a Canadian Administrative Presence

Posted by Shannon Dowdall

|

Feb 9, 2018 9:00:00 AM

How_to_Establish_a_Canadian_Administrative_Presence-1.jpgDoes your business operate in Canada? Are you thinking about expanding into Canada? No matter which situation more accurately describes you, you’ve probably thought about how you’ll handle payroll, taxes, compliance, and more.

Download our free guide on what US companies need to know about paying  employees in Canada.

For foreign businesses expanding beyond their borders into Canada, the administrative side of the business can become quite complex. You’re likely used to the processes and rules at home, but you may find the Canadian regime more than a little confusing.

It can be confusing even for Canadian-owned and operated businesses! Whether you’re growing and need some administrative guidance or you’re expanding into a new province, you may find yourself faced with administrative questions you can’t answer.

There’s an easy way to shore up your Canadian administrative presence in any of these situations: team up with a Canadian employer of record.


You Need Help

Whether you’re an American business coming north of the border or a Canadian start-up facing fierce growth, the reality is you can likely use a helping hand when it comes to managing your administrative activities, such as payroll and other HR activities.

Foreign entities may find themselves somewhat baffled by the differences in Canadian payroll rules and the complexity of the provincial legal system.

As mentioned, the solution is to team up with a Canadian employer of record (EOR). They can help you manage your administrative activities with ease and grace.

The next question on your mind is probably, “How do I find one?”


Do Your Homework

The first thing you should do is look up a few Canadian EORs. There are many out there, so you’ll want to do some careful research. Not all EORs are created equal. Some have more experience and expertise. Some will have better track records than others.

Ask for recommendations or visit reputable third parties to find some recommendations. Narrow your list of potential providers. Research what they offer and how their plans fit your needs. Finally, you’ll want to compare prices and service offerings.


Ask for a Quote

The next thing on your list is to get quotes from the EORs on your shortlist of names. While you want to compare pricing options, getting quotes also has another purpose. You can begin to evaluate each potential provider’s customer service!

If a provider doesn’t get back to you right away or they don’t seem interested, their attitude is unlikely to improve. Set high standards and you’ll be sure to find the best Canadian EOR to establish your Canadian administrative presence.


Working Together

Once you’ve decided on a provider, you can sign a contract and begin working together. This has many advantages for you as a business.

First and foremost, you get the expertise of a team of people who deal with the Canadian payroll and legislative framework every day. If you have questions, they can answer them. You don’t need to worry about the intricacies of vacation time legislation in Ontario versus Quebec. As the legal employer of your employees, the EOR will handle all these employment situations.

It will also simplify the process of remitting your payroll taxes to the Canada Revenue Agency and paying your employees. It can help you avoid audits, as you can be sure your compliance will be up to date.


Why You Need an Administrative Presence in Canada

Even with these benefits in mind, you may wonder why you need an administrative presence in Canada. After all, you have systems in place at home, and your talented staff is more than up to the task of learning about the Canadian system.

Having an administrative presence in Canada is a necessity to do business in the Great White North. And EOR can make the process a breeze, so you can worry about strategy instead of administration.


12 Things an American Company Looking to Hire a Worker in Canada Needs to Know

Topics: Business Expansion

4 Payroll Compliance Errors and How Much They Cost

Posted by Ray Gonder

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Feb 7, 2018 9:00:00 AM

4_Payroll_Compliance_Errors_and_How_Much_They_Cost.jpgPayroll compliance is important to you and your business. After all, you want to be sure you’re doing things on the up and up.

Download our free guide on what US companies need to know about paying  employees in Canada.

Nonetheless, compliance errors are quite common. Some business owners don’t truly realize they’re doing anything wrong. They may think they’re completely compliant with the law. Worse, these sorts of errors can cost you more than a pretty penny. Here are a few of the most common errors and their price tags.


1. Failure to Deduct

Perhaps the most common payroll compliance error is a simple failure to deduct. Some employers think they can pull the wool over the CRA’s eyes by issuing payments off the record. Others may try to pin responsibility for payroll taxes on the employee. Others may not be aware they need to deduct payroll taxes for certain kinds of employment income such as employer-provided housing.

The CRA can levy penalties worth 10 percent of the amount of Canada Pension Plan and Employment Insurance premiums, as well as 10 percent of the income tax you failed to collect.

If you happen to be penalized twice in a single year for failure to deduct, you can be assessed a penalty of up to 20 percent of EI, CPP, and income tax deductions. Depending on how many employees you have and their earnings, it adds up!


2. Late Remittance

The next most common payroll compliance error is late remittance of your deductions. While you did deduct the appropriate EI, CPP, and income tax amounts, you just didn’t get the funds to the CRA. (If you never send the funds, this is known as “failure to remit.”)

The CRA will begin assessing penalties for late remittances almost immediately. The penalty starts at three percent for payments one to three days late, then climbs to five percent between four and five days. If you submit your funds six or seven days later, the penalty is seven percent.

If you’re more than a week late submitting your remittances, you can be assessed a penalty of 10 percent. Again, depending on how much you have to submit to the CRA, these penalties can become quite hefty!


3. Failure to Obtain Employee SINs

As an employer, it’s your responsibility to record your employees’ social insurance numbers (SINs). You’re required to ask employees and record their SINs within three days of their start date with your company.

If you’re judged not to have made a reasonable effort to obtain an employee’s SIN, you could be charged $100. This is also true for employees in pensionable or insurable employment. Employees who do not yet have a SIN need to apply for one and provide it within three days of receiving it. Additionally, you need to report this situation to Service Canada.

If an employee fails to provide a SIN but you’ve made a reasonable effort to obtain the information, the CRA may not assess the penalty. Otherwise, you can be assessed $100 for each SIN you fail to collect. While $100 here or there may not seem like much, it can add up and is easily avoidable.


4. Failure to Maintain or Provide Records

The CRA can also determine whether or not your bookkeeping has been adequate. The Income Tax Act allows the government to determine what records and books must be kept. The CRA may send you a written request to maintain your books in compliance with the law, and they’ll normally follow up within a month to make sure you’ve complied.

If you haven’t, or you fail to provide records as requested, you can be prosecuted. The minimum fine is $1,000. You could even face jail time.

Payroll compliance errors can have some high costs. Don’t wind up on the hook for these penalties and make sure your payroll is compliant with help from the experts.


What US Companies Need to Know about Paying Employees in Canada

Topics: Compliance

Your Guide to Vacation Pay in Saskatchewan

Posted by Anna Mastrandrea

|

Feb 5, 2018 9:00:00 AM

Your_Guide_to_Vacation_Pay_in_Saskatchewan.jpgSince the federal government largely leaves employment legislation to the provinces, each of Canada’s provinces have been able to make their own rules. If you’re a foreign company opening its first office in Saskatchewan, you’ll want to learn about vacation time rules!

Download our free guide on what US companies need to know about paying  employees in Canada.

Saskatchewan is something of a hotspot right now. If you’re thinking about setting up shop in Regina or Saskatoon, take a look at this guide to vacation pay in Saskatchewan.


Why Saskatchewan?

The first thing for any employer to ask is why they’re going to Saskatchewan. Although the province has a reputation as being exceedingly rural, flat, and nothing but prairie, the truth is Saskatchewan has become something of a hotspot for several different industries.

Perhaps the best example is the potash industry. Uranium mining has also been common in the province’s north. Biotech is another hotspot. Retail and manufacturing are also important and growing.

If you have operations relating to any of those industries, Saskatchewan may be the place for you!


Vacation Time

If you’re going to employ workers in Saskatchewan, you need to know employment legislation. One of the important aspects of that is how vacation time is accrued and paid.

Vacation pay in Saskatchewan is governed by The Saskatchewan Employment Act. Employees who work more than one year and less than ten years are entitled to three weeks of vacation each year. If an employee works more than ten years for you, they are entitled to a minimum of four weeks’ leave.

Employees who have worked less than a year are not entitled to vacation pay. In order to be eligible, employees must work for 52 consecutive weeks, without a break in service of 26 weeks or longer.


Who Is Entitled?

In Saskatchewan, vacation days accrue on an annual basis. After 52 weeks of service, an employee becomes eligible for three weeks of vacation. Most employees are entitled to vacation pay, no matter how many hours they work or how they’re paid.

Exceptions include seasonal and short-term employees who work fewer than 52 weeks or who have absences of 26 weeks or more. If you hire an employee to work in the summer and fall and terminate their employment in the winter before rehiring them in the spring, they would not be entitled to vacation. An employee who took a leave of absence over the winter would be.


Calculating Vacation Pay in Saskatchewan

Once you’ve determined who’s entitled to vacation pay in your company, you’ll want to know how you can calculate pay.

The rules for vacation pay in Saskatchewan are relatively straightforward. A salaried employee would receive 3/52 in vacation pay. Take their total annual wages and multiply it by 3/52. This accounts for the three weeks of vacation out of the total 52 weeks of the year. For an employee with ten years of service or more, the rate is 4/52.

You can also choose to pay vacation pay per pay period. In this case, take the total wages for the pay period and multiply it by 3/52 or 4/52. This will give you the vacation pay the employee has earned for this pay period.


Paying Annually or per Pay Period

Employers can choose to pay vacation pay in Saskatchewan annually or per pay period. Annual payment may be best for those who have salaried staff. Those who pay their employees by the hour may prefer to tally vacation pay per pay period.

Keep in mind you must calculate vacation pay on total wages (including commissions and bonuses). Vacation pay must also be calculated on the vacation pay amount.

Vacation pay in Saskatchewan isn’t overly complicated, but you do want to be sure you’re administering it correctly. Talk to a payroll provider today and see how they can help.


Canadian Payroll Tax Deduction Calculator

Topics: Compliance

The Complete Guide to Choosing the Right Employer of Record

Posted by Ray Gonder

|

Feb 2, 2018 9:00:00 AM

The_Complete_Guide_to_Choosing_the_Right_Employer_of_Record.jpgThe year 2018 is perhaps one of the most opportune times for U.S. and foreign employers to expand their businesses into Canada. Last year, the Canadian economy saw a 3.1 percent increase in growth, and even as its rapid pace has slowed somewhat in 2018, forecasts are still predicting a solid 2.2 percent. Despite such a solid base for U.S. and foreign business prospects to gain a foothold, many businesses hesitate to expand into Canada.

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The apprehension is understandable, given that registering a business in Canada as a foreign employer can be complicated. There are many tedious steps involved in setting up shop legally in Canada since businesses are regulated differently from province to province (or territory).

If you’re determined to establish grounding for your business, however, chances are you’re looking for an employer of record (EOR). Such an organization can streamline the whole process, and we’re here with a complete guide to help you find the right EOR.


Does the Employer of Record Have Canadian Experts?

The above is the first question you should be asking yourself when you’re surveying your options for an employer of record. One of the biggest mistakes that you need to avoid as a foreign business planning to expand into Canada is being uninformed about the Canadian market.

Many U.S. businesses in particular make this mistake; they assume there are enough similarities between American and Canadian markets that they believe they can manage on their own error-free. This mistake can be a drain on both your business’ time and resources, as there are many potential pitfalls concerning proper establishment of a Canadian administrative presence and infrastructure.

The right EOR will be the one that’s based in the country you wish to expand into. This EOR will have experts on staff who are well-versed in business expansion and payroll compliance. Speaking of which—


Will the EOR Manage Government Accounts?

A proficient EOR should be able to keep up ongoing payroll compliance. Canadian compliance is notorious for its constantly evolving nature. Fines for late or missed remittances are also steep—up to 10 percent for payments over $500 and seven days late. There isn’t much room for error, and your business reputation will rapidly decline if you often underperform in the compliance area.

The right EOR will register and maintain all necessary government accounts, such as those with the Canada Revenue Agency and WSIB.


Can the EOR Meet All Your Employment and Payroll Demands?

Ideally, your business should have all necessary accounts by the time you start employing workers in Canada. The right EOR will make that process a cinch, but it will also ensure your banking and insurance infrastructure is set for timely and compliant payroll. In effect, your EOR should take over all employment matters and ensure compliance.

There’s a lot you need to know about paying employees in Canada. You need to keep up on legislation, make sure T4s, Records of Employment, and paystubs are properly distributed, and see to the admin of your employee benefits and RSP contributions, among other tasks.

High-quality EORs can meet all the demands of running a business in Canada and more. Partnering with the right EOR will allow you to focus on what you excel at: your core business responsibilities.


What US Companies Need to Know about Paying Employees in Canada

Topics: Employer of Record

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