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5 Ways an Employer of Record Can Contribute to Business Growth

Posted by Stacey Duggan

|

Jun 19, 2017 9:00:00 AM

5 Ways an Employer of Record Can Contribute to Business Growth--.jpgBusinesses are always looking for ways to expand their business, through work practices, company brand, and increasing the number of staff employed. With expansion comes a number of other burdens, particularly in the administrative field. These very quickly take up time alongside growth of the business itself.

There’s a solution that makes it easy. An employer of record (EOR) can help with business growth in five different ways. Keep reading to learn how.

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

1. Long-Term Savings

An employer of record handles a wide variety of issues and matters for a cost that’s less expensive than it is to manage in-house. As EORs help many clients, businesses are essentially sharing these resources through the EOR, generating savings from software updates, HR training, and time dedicated to understand workforce compliance.

Hiring new employees, for example, is a good sign, but with it comes more paperwork and additional time to manage them. It means legal and regulatory changes, ongoing training regarding HR, adding to payroll, and other employee training regarding health and safety, workplace management.

Ensuring HR and payroll is in line with government standards is a time-consuming that takes time away from core tasks. EORs stay on top of these duties, allowing employers to use that time growing their business.

2. Added Value to Hiring and Staff Management

A growing business includes an increase to the number of staff employed. As a co-employer, an employer of record will hire and manage staff on behalf of the company. For businesses venturing into new markets, EORs understand the process in place to ensure correct hiring.

They’ll handle the interview process and training, to guarantee new hires meet the specific qualities sought by employers. Providing EORs this kind of pre-determined outline ensures the best fit and staff for a company to continue to grow with the necessary support and resources.

3. Avoid Mistakes

Mistakes have serious consequences with the Canada Revenue Agency, other government bodies, and generally cause an overall headache for businesses. An EOR makes sure a business’ payroll and deductions are error-free to avoid fines, penalties, and lawsuits.

With an EOR handling payroll, compliance, and related matters, they’ll ensure employees are classified as they should be, the business is in line with provincial and federal workplace standards, and all other necessary requirements are met. This keeps businesses on the government’s good side, and employees happy.

4. They Provide the Right Tools

Software eases business growth and expansion. It’s also expensive and requires constant updates. Working with an EOR means there’s no need to worry about forgetting to update software or searching for the right kind because they maintain the different platforms in order to do their job effectively.

EORs are experts trained in HR and payroll to make implementing easy as businesses grow. They have knowledgeable associates and offer additional perks, such as group benefits and discount insurance rates, which employers–particularly for small businesses, don’t always have access to alone. EORs provide support to deal with all kinds of situations and answers to any questions there might be.

Whether it’s a company with a small client base and limited staff, or a bigger company entering new territory, EORs cover many aspects so businesses don’t have to worry about remembering to keep up with software or ensuring access to appropriate benefits.

5. Peripherals Managed

With the time-consuming and tedious tasks covered, businesses can get back to focusing on strategy, marketing, and overall growth. It’s hard to manage core tasks when administrative tasks are taking up a significant part of the day.

Tax, payroll, labour, and employment are covered by professionals with the knowledge and time to research and understand these matters. When employees stay focused on core tasks and an employer of record handles the rest, businesses can ensure the best competencies are in place for business practice and expansion.

What Are You Leaving to Chance by Handling Payroll on Your Own

Topics: Employer of Record

Canadian Payroll Providers Can Take Your Business to the Next Level

Posted by Stacey Duggan

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May 29, 2017 9:00:00 AM

Canadian-Payroll-Providers-Can-Take-Your-Business-to-the-Next-Level-1.jpgBusiness owners are always looking to develop their companies,whether by strengthening brand reputation or discovering new marketing trends and strategy. More businesses have become aware ofthe advantage that outsourcing payroll leads to business improvement

You’ve no doubt noticed the time this department takes and the tedious tasks involved. If you’re looking for a way to take your business up a notch, consider Canadian payroll providers.

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

Industry Expertise and Innovative Technology

The world changes, the markets change, and new trends can be hard to stay on top of while trying to make sure you also meet your business goals. With Canadian payroll providers handling payroll, you can get back to doing the best job. 

Accurately and efficiently handling payroll is their livelihood, which means they stay in the know and remain ahead of the curve for new payroll methods and changes. Their expertise will increase your department’s efficiency and give you insights into the latest HR and payroll trends. Payroll providershave a full understand of new laws, along with cutting-edge information, which are passed on to improve your business.With this information available to you, your business isalways up to date. 

Communication and technology are always changing, and to do their jobs properly these providers must have the latest information available. With their state-of-the-art software and technology to calculate payroll, you don’t have to worry about mistakes or worry aboutregularlybuying andupdating software. 

Canadian payroll providers are always trained with the latest information, tools, software, and payroll methods to make your businessas efficient as possible.You’ll get the upper hand on industry knowledge without spending additional time or money on payroll—a win for everybody.

Navigate Compliance

Tricky, complex, and time consuming, compliance is hard to navigate and comprehend if you don’t have a full legal team that knows the ins and outs of the business. Each territory comes with its own regulations, and if you’re operating or expanding into multiple places, you need to comply with each individual province’s rules. 

Wages, benefits, employment standards, human resources—your business has to meet all of these guidelines to avoid penalties, audits, and lawsuits. Canadian payroll providers minimize the risk of error with experts whose job it is to successfully navigate these waters and ensure your business is, and remains, error-free. From tax filing to work conditions, this team is in the loop to do their jobs effectively. 

You’ll have security in knowing they’re keeping your business compliant.You can eliminate mistakeswith the help of a knowledgeable team that knows how to correctly calculate payroll, file remittance reports, and generate end-of-year paperwork. These payroll professionals handle all of your payroll and tax law, human resources, and associated matters to ensure your business is compliant.

Time for Core Tasks

Payroll is tedious and time consuming. Time spent here takes time away from your core duties. With the legwork handled by Canadian payroll providers,time is freed up so you can get back to improving and expanding your workforce.With a team that’s nolonger dedicated to in-house payroll processing, you can delegate your staff to principal matters.

With the tricky aspects of payroll covered, your HR employees can get back to business. Canadian payroll providers increase your company’s efficiency and cut down on waste.

With a single team handling the peripherals of the job, removing payrolloff your plate gives you the time to focus on branding, marketing, and other company duties. Get back to focusing on your employees and meeting your business goals.

Canadian Payroll Tax Deduction Calculator

Topics: Payroll Processing

What U.S. Companies Need to Know about Canadian Payroll Regulations

Posted by Stacey Duggan

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May 15, 2017 9:00:00 AM

What-U.S.-Companies-Need-to-Know-about-Canadian-Payroll-Regulations.jpgExpanding your business into a new territory is an exciting time. With it, of course, comes a number of new regulations and rules to follow. Canadian employees have a different set of payroll regulations, and U.S. employers need to be well-versed in them to ensure they’re paid correctly. 

Although Canadian neighbours aren’t too far north, the standards are quite different. Here’s what U.S. companies need to know about Canadian payroll regulations.

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

Federal and Provincial Heads

Canadian payroll regulations are regulated at two levels: federal and provincial. It’s not enough to be in line with federal standards; you need to comply with each individual province. This brings a few more rules into the mix, and several variations if employees live in different provinces. 

Each provincehas its own employment standards act, outlining payroll compensation, work standards, health and safety issues, termination, and other related matters.Public holidays, for example,can vary between provinces. British Columbia celebrates Family Day a week earlier than Ontario, meaning employees in those provinces could have holiday pay in different pay periods.All provinces abide by the Employment Insurance Act, a major federal law, which covers funding for maternity and paternity leave, as well as sickness and compassionate care. 

U.S. businesses need to be aware of both levels for accurate recordkeeping, tax filing, and overall compliance.

Registration

Before a business can begin operating in Canada, it needs to be registered with the proper accounts. This establishesa presence in the Canadian market and confirms Canadian employees can be paid. All businesses have to register for a business number and payroll program account through Canada’s federal tax agency,the Canada Revenue Agency (the CRA). This is where GST, tax deductions, and other annual payroll and tax information are reported. Without registration, Canadian employees cannot be paid, and the business doesn’t yet exist. It’s important to complete this step right away.

Classification

Employee classification is important to get right because it effects total amounts paid to employees, any benefits they’re entitled too, their source deductions, and more.The CRA has problems with businesses that misclassify workers.

While it might seem easiest to classify all Canadian workers as independent contractors, this could still cause headaches, especially if these workers don’t meetthe government’s definition of an independent contractor.

The CRA developed a four-point test to determine the type of employee. Elements include: control, tool ownership, integration, and profit risk/loss. Courts will look at individual circumstance to determine the type of worker, so U.S. companies should pay close attention to the employer-employee relationship.

Compensation

Canadian payroll regulations outline the minimum standards for employee compensation and when employers have to compensate their employees.Provincial regulations define whether employees must be paid once a month, biweekly, or a weekly minimum. It’s important to note the province employees work in to ensure U.S. companies are following the right regulations.

Minimum wage rates vary across the provinces. Alberta has a higher minimum wage rate than Ontario. The industry employees work in also affects wage rates. Waitressing, for example, has a different minimum wage rate than retail. Each location has itsown standard to be aware of to ensure U.S. businessescomply with the correct legislation.

Tax Deductions and Filing

Payroll taxes are deducted and filed with the CRA and some other government agencies.U.S. companies need to know all the agencies to ensure correct filing. Failing to remit and deduct taxes correctly can lead to fines, unnecessary audits, and overall embarrassment for businesses.

Taxes at both the federal and provincial level have to be applied, and remittance periods depend on each company’s status. Ensure the right amountsare deducted based on employees in different provinces, and the right forms are prepared for submission. Setting this up correctly at the start will help avoid headaches later on.

What US Companies Need to Know about Paying Employees in Canada

Topics: Compliance

What Every Business Should Know about Paying Employees in Canada

Posted by Stacey Duggan

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May 1, 2017 9:00:00 AM

What-Every-Business-Should-Know-about-Paying-Employees-in-Canada.jpgIf you’re just starting a business or considering expanding your foreign business into Canada, you need to brush up on Canadian payroll laws. For any business owner exploring new territory, paying employees in Canada is nowhere near the same as the geographic area of your current employees. Keep reading to learn about paying employees in Canada.

Pay Varies Provincially

Your employees in Manitoba adhere to different pay and labour standards than your employees in Ontario. If you thought pay legislation would be the same across the country, you need to think again. Provinces stipulate their own minimum wage rates, acceptable overtime hours, paid leave–even pay frequencies. Statutory holidays and its pay isn’t even the same across the country. 

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

Businesses can avoid pay mistakes by ensuring they read the correct provincial legislation in addition to the federal regulations. Don’t oversimplify this process. With so many detailed differences between provinces, businesses need to be aware of the ones applicable to them.

Accounting for Deductions and Reporting

Employers deduct three big taxes from employees and themselves each period. Known as source deductions, these have to be deducted and filed correctly, or you’ll run into problems such as penalties and fines, from the Canada Revenue Agency. Source deductions include the Canada Pension Plan, Employment Insurance, and income tax, and each one has their own exceptions within, requiring annual remittance reports filed with the total amounts deducted throughout the year. 

Employers have other reporting requirements to follow as well: maintain T4 accounts, which accounts for salary, tips, bonuses and all other monies paid to employees throughout the year, and issue ROEs, the record of employment all employers must keep and file when an employee leaves the company. For help and other questions, business owners can visit the CRA’s website.

Employee Information for Payroll

Paying employees in Canada requires some personal information. Upon hiring an employee, there’s important documents new staffmust complete and submit in order to receive the correct pay and have the right tax amountsdeducted.

Their SIN number will be necessary to confirm they can legally work in Canada, and will be used to administer government benefits. Both a TD1 form and personal tax credits return form is completed to determine the correct tax deductions from said person’s employment income. Businesses should also consider other administrative things, like keeping individual employee files to store all related paperwork and notes.

Type of Employee

Correctly labelling employees is vital to correctly paying employees in Canada. It effects their pay rate, tax deductions, and eligible benefits. Independent contractorsand full-time employees vary in terms of control, supervision, job flexibility, and more. The nature of the employer-employee relationship is important in knowing what kind of employee it is.

Understand the correct factors and consult the government’s four-point test to be sure you’ve classified your employees correctly. Misclassification leaves the CRA irritated, and poised to hand out severe penalties. Even after hiring, it’s a good idea to regularly revisit employee files and duties to ensure their labels haven’t changed.

The Right Software to Use

Having the right software significantly eases the burden of paying Canadian employees. Businesses will need the latest program and correct tax tables to ease pay calculations. Ensure staff using it have undergone the right training, and fully understand how payroll is calculated to reduce your business’ risk of errors.

The CRA provides tools and online calculators to help, and a number of software options are available to employers. On top of calculating payroll, software automates the manual tasks to save time, archives employee pay slips, and generates in-house reportsfor concrete pay history.

Whether you’re a new business owner or growing your current business, there’s a lot of information concerning pay rate, hours, tax deductions, and more. Businesses should keep all of these aspects in mind when paying employees in Canada.

What US Companies Need to Know about Paying Employees in Canada

Topics: Compliance

5 Mistakes to Avoid When Hiring Canadian Independent Contractors

Posted by Stacey Duggan

|

Apr 17, 2017 9:00:00 AM

5-Mistakes-to-Avoid-When-Hiring-Canadian-Independent-Contractors.jpgSometimes, employers just don’t need full-time employees but require workers for specialized projectsin shortertime period. For those looking to hire these types of worker, it’s important to make sure you understand how contractors differ from employees

Avoid these five mistakes if you’re considering hiring Canadian independent contractors.

1. Classification

Misclassification is big problem for businesses. Wrong employee labels result in serious consequences. By misclassifying, you’ve been miscalculating wages, benefits, and taxes incorrectly from the start. Canadian independent contractors are not employees, and this crucial distinction is defined by their nature within the company. 

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

Courts use a four-point test to classify an independent contractor:control, equipment and tool ownership, subcontracting ability, and profit chance/risk loss.Contractors have more independence from the employer than full-time employees. They generally own and provide the majority of the equipment and tools for the project, and theyhave the ability to subcontract some work if necessary. In addition, if they have a chance of profiting and run the risk of incurring lost profits, they’re contractors.

2. Poorly Drafted Contracts

An employee contract should be drafted in line with the provincial Employment Standards Act, and the same rules apply for contractors. If a contract is signed between the business and the independent contractor, it’s necessary to clearly indicate within that said person is an independent contractor. Clearly defining this worker within the contract helps it hold up and remain enforceable in court. This will also later help fend off categorizationissues by the Canada Revenue Agency. 

A well-written contract classifies the intention of the relationship. While courts will still consider circumstance and individual facts of the case, well-worded contracts between businesses and independent contractors better highlight theirindividualsituations.

3. Miscalculated Taxes

Taxes for Canadian independent contractors are calculated differently than employees, precisely because of their different classification. In fact, employers do not handle the tax responsibilities for contractors at all. Again, the importance of labelling workers correctly at the beginning is key for avoiding future penalties and ensuring the right amounts are calculated in final remittance reports. 

When it comes to contractors, withholding amounts, reporting requirements,and CPP and EI contributions are not deducted as with regular employees. 

Knowing the difference is crucial forensure compliance with tax regulations.

4. Wrongful Distribution of Wages and Benefits

Pay and benefits also have to be precisely calculated. Just like tax deductions, these are also totalled differently. Canadian independent contractors aren’t provided benefits. 

A contractor isn’t employed by the employer in the same sense that an employee is, so a contracto’s pay is calculated differently—they are typically paid a higher wage but they do not have deductions for benefits, pension, or anything else. An employee integrates commercial activities to the payer while independent contractors integrate the payer’s activities to their own commercial activities.

5. Miscommunicated Intention

If you’re unclear about contractors’ roles from the beginning, the intention of their business may never clear up during the project. Confusing employee status can cause problems in the working relationship.Remember that unlike with the employee, the employer has less control over independent contractors. Contractors set their own schedules, which both parties agree to. 

Contracting shouldn’t be a full-time job disguised an independent contract work–this is an incorrect intention. Employers should familiarize themselves with the legislation and policies on employees and Canadian independent contractors to ensure they clearly understand the differences between them and can clearly communicate the intent of both workers. The four-point test mentioned earlier is key to distinguishing the type of worker hired. 

Clearly understandwhy contractor services are considered independently contracted. Be clear about who you’re working with and the job needed to ensure both parties know a contractor is hired and not an employee. Miscommunication just leads to confusion.

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

Topics: Compliance

How Do I Terminate an Employee Who Isn’t Working Out?

Posted by Stacey Duggan

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Apr 5, 2017 9:00:00 AM

How-Do-I-Terminate-an-Employee-Who-Isnt-Working-Out.jpgIt happens. You hire someone who appears to be the right fit with the right qualifications. Shortly after they start though, it’s a disaster. Incorrectly firing personnel is bad business, so how can you fire staff without getting into legal hot water? You have to cover all your bases to ensure you correctly terminate an employee, and protect your business.

Timing

Employers have to be incredibly careful when deciding to terminate an employee. Ideally, the sooner you can terminate an employee, the better. The standard 90-day probation period generally lets employers off the hook for firing, however, confirmwith the correct legislation in case a period of notice, or pay in lieu of,still applies. Firing an employeewithin this period can also leave employers vulnerable to backlash comments that this intervalis a training and skill-testing period, but generally, employees fired at this time have no right to appeal.

Firing a staff member after probation requires a reasonable notice period.Various factors will determine how long reasonable notice is: age, years of service, their character, and availability of similar jobs. Employees are still entitled to receive compensation and benefits for a sustainable period, as if still employed by the employer.

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

Comply with the Employment Standards Act

Review all the various laws to ensure you can terminate said employee and have met the provincial legislation standards to avoid possible lawsuits and legal penalties. Each province has its own labour law or employment standards act to follow, which specifies whether the employee has to be paid out or not. They also outline the minimum standards of pay and benefits employees are entitled to receive upon leaving. 

When you terminate an employee, their severance package must meet these minimum requirements. Ensure you’ve followed the provincial legislation, your employer handbook, and the employment contract prior to firing. If necessary, obtain legal advice to confirm you’ve covered your bases.

The Employment Contract and Termination Letter

Complying with the correct terms of the employment contract is key to verifying termination. Employment contracts need to be reviewed to make sure you’re not breaching any terms, and the contract will spell outspecific provisions regarding termination. Examining this document first ensures you have legal grounds to fire this employee.You may also need to confirm the employee was given proper warnings and a chance to improve, and that regular performance reviews were conducted along with meetings and chances to explain, if necessary.

Keep in mind that termination clauses in contracts may vary depending on who drafted it. Courts have the power to set aside documents that don’t meet the provincial requirements, so it’s important your employment contracts meet minimum standards in initial drafts to avoid future legal disputes. Improperly drafted contracts that fail to meet ESA standards can be thrown out.

After reviewing the contract, draft the termination letter. The termination letter must be ready when you call the meeting with the employee, and after you’ve inspected the employment contract. It should specify the end date, and clearly communicate that this is termination, to avoid confusion of it beinga disciplinary or time out period. Details about the amount of notice, payment in absence of, and severance package will be noted here.If your letter offers benefits above the requirements outlined in the ESA, have the employee sign a release in exchange for receiving the statutory amounts. This ensures full coverage and future liability for your business. This option is completely discretionary to employers.

Once you’re legally and ethically clear to fire, deliver a termination notice and hold an exit interview to explain to the outgoing employee the reasons they are being let go. It’s not easy firing staff, but at the end of the day, it’s just business.

7 Signs It's Time to Outsource Payroll

Topics: human resources

Why Use Payroll Outsourcing

Posted by Stacey Duggan

|

Mar 13, 2017 9:00:00 AM

Why-Use-Payroll-Outsourcing.jpgPayroll is one of the biggest hassles for businesses. Writing cheques, calculating payroll, paying taxes, and maintaining accurate records takes time away from core objectives. When you own a small business, the time and affiliated costs devoted to payroll management means less time and money spent improving your business’soverall features. 

Tocombat this, small businessesareturning to the expertise of third parties. Read on to discover how payroll outsourcing could help your company

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

Reliability and Knowledge

When you outsource payroll to a third party, you can be sure of expert knowledge and a reliable team. 

It’s hard to keep up with new regulations, changing tax rates, and revised government forms. You can be sure third-party firms have this covered and are able to handle any upcoming changes because their job requires it. They know the ins and outs of payroll processing, compliance and HR matters, ensuring your business meets government standards. 

The expertise outsourcing firms provide means your business is less likely to submit incomplete forms, which would result in penalty charges for late filings and missing paperwork. Outsourcing payroll to a third party ensures correct and complete submission of applicable forms and reports required by the government.

Save Time and Money

With your payroll and HR departmenttaken care of, your employees can get back to focusing on your business’s chief goals. 

The time spent maintaining accurate accounting reports, submitting tax receipts, and filing employee insurance can be reallocated to marketing, strategy, customer service, and other daily chores. Staff who previously dealt withpayrollcan now concentrate on principle business matters. 

Time saved is money saved. As third parties operate at volume, they can handle your business’s responsibilities for less than in-house costs, helping reduce your overhead fees. 

Calculating payroll is a time-consuming, detail-oriented task that requires substantive review. Payroll outsourcing gives that time back to small businesses, so they can continue refining the key characteristics of their business.

Don’t Worry about a Contingency Plan

Handling payroll in-house means there’s always a chance of staff leaving, whether for retirement or a job elsewhere. 

This risk is eliminated when you work with a provider, because you don’t have to fear staff, andtheir skills, walking out the door. Outsourcing payroll removes two burdens: spending time and money in-house to hire someone new, and training said person. 

When you delegate payroll to an outside firm, you always have a team of experts within reach, ready to handle your payroll matters.

One Team = Multiple Departments

The payroll department doesn’t end after calculating and distributing payroll. It also covers human resources. You have to account for benefits, pension plans, worker’s compensation, sick pay, and more.

Many providers offer additional services to meet your firm’s specific needs. Trained professionals have the skills to handle your distinct HR concerns. With these responsibilities taken care of, your team has more time to concentrate on business improvement and overall efficiency.

Most firms are flexible with the services they offer, and for a small fee, can easily integrate their information with your company’s demands.

Won’t Be Left Behind

Managing payrollis a meticulous duty. Payroll outsourcing requires constantawareness of current pay rates, tax law, employment standards, and the right technology to ensure these tasks are done properly.

Third parties keep pace with filing, technology, and other timely updates.They understand the specifics of legislation that apply to your business, so you can be sure your payroll department is in line with federal and provincial standards.

Legislation isn’t the only thing to be aware of—updated technology is essential to completing and filing your forms properly. Continuously updating your firm’s softwareto the most current version is an additional, and sometimes costly, expense. Without it, however, the wrong tax tables can leave errors in your records. Payroll outsourcing provides you with a team that is sure to have the latest technology at its fingertips to get the job done properly.

7 Signs It's Time to Outsource Payroll

Topics: Payroll Processing

Why Payroll Compliance Legislation Is Important

Posted by Stacey Duggan

|

Feb 20, 2017 9:00:00 AM

Why-Payroll-Compliance-Legislation-Is-Important.jpgBusiness owners have a number of rules to follow to run their businesses effectively, from both a corporate and legal standpoint. Payroll compliance is arguably the largest financial obligation a corporation has, and employers should always keep in mind compliance and legislation to avoid serious penalties. 

The legislation surrounding payroll can be confusing, so it’s critical for businesses to be aware of current and changing regulations. Below are some key issues that highlight the importance of payroll compliance.

Legally Required to Comply

If your company doesn’t meet the standards of various acts and legislation, you’ll run into a mountain of problems. Understanding employment and tax law are necessary to accurately report your company’s operations, and incorrect filing or employee misclassification can lead to fines, penalties, or potential lawsuits. For the growth and safety of your business, ensure you’re complying with the correct laws and regulations so your business is operating in a sound manner. 

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

Making sure your company’s paperwork is accounted for is key, and one aspect of this is that corporations have to file taxes to be recognized as legitimate businesses. To make sure your company is in good standing and filing paperwork correctly, understand which federal and provincial laws apply to your business in order to ensure that your organization is following them. If you’re unsure, you can seek advice from a third party. 

Legal compliance varies across the provinces—businesses in each province abide by a different employment standards act. To make sure your company is in line with regulations, and to avoid fines or penalties, make sure your business adheres to the correct provincial legislation.

It’s Not Just about Payroll: Ethics & HR

Payroll compliance doesn’t stop at making sure your employees are paid correctly and your tax reports are filed on time. It includes your company’s human resources department: employee benefits and bonuses, hiring and firing practices, and how pensions, sick leaves, and holidays are paid, for example. 

Compliance goes hand-in-hand with human resources, and your business should have a strong code of conduct and good company ethics. For their own consideration and security, businesses need to make sure they look after their employees. As the business owner, you want to make sure you aren’t infringing on your employees’ rights or benefits. 

Payroll legislation is about more than simply processing payroll because it affects all areas of a corporation. Manage, and reduce, your company’s risk by making sure every aspect of payroll compliance is included.

Seek Third-Party Help

As payroll compliance can be confusing and overwhelming, you may find it more helpful to consult an outside source. Third-party firms, or professional employer organizations (PEOs), are an advisable solution for corporations that do not have the time or resources to keep a legal team in-house to focus on changing regulations.

PEOs and outsourced providers are convenient because knowing the ins and outs of payroll compliance is the heart of their business. Their expertise extends beyond payroll to include tax filing, classification, health and safety, employee sick leave, holiday and benefit pay, as well as knowledge of employee and tax law.

Instead of using your resources and time to pay a team in-house that may not understand all aspects of compliance, outsourcing the work to a team that does will help your firm avoid costly mistakes. Working with a third party means working with people who are fully capable of handling the trickier parts of compliance legislation.

Companies that don’t follow payroll compliance put their futures at risk. Complying with the demands of payroll legislation will keep your business legally responsible and running smoothly.

7 Signs It's Time to Outsource Payroll

Topics: Compliance

5 Mistakes US Companies Make When Expanding into Canada

Posted by Stacey Duggan

|

Feb 6, 2017 9:00:00 AM

5-Mistakes-US-Companies-Make-When-Expanding-into-Canada.jpgAn increasing number of US companies are setting up shop in Canada, while others have plans to do the same. Unfortunately, expansions are often rushed in order to start profiting from a new market as quickly as possible, and this leads to mistakes being made.

Though the economic landscape is fruitful, strong, and steady, you must avoid making devastating mistakes when expanding into Canada. Here are the top mistakes that are constantly being made by US companies that cross the border.

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

1. Failing to Understand Canadian Employment Laws

Though Canada and the United States are similar in many ways, there is one distinct difference that must be considered: employment law. Once you start to hire Canadian employees, you must treat them, pay them, and manage them following Canadian employment standards—not the US standards that you’ve been used to following.

Many businesses expanding into Canada fail in this regard. They do not research federal and provincial/territorial laws, and thus, they fail to follow the required regulations. Whether it’s overtime pay, health and safety, human rights, payroll or anything in between, you must be compliant or you will face the consequences. Seemingly simple regulations such as drug testing employees is different in Canada, so ensure you do your compliance research.

2. Failing to Research the Market

Canadians may seem to love your brand. You may believe that you’ll make a great profit by expanding into Canada, but it’s important to understand just how large, complex, and costly of an undertaking it is to cross the border in business. If you don’t take the time to research your market, the demand, your competition, and the available talent, your new business venture could end up failing. Target’s failure in Canada is a great example of this mistake.

3. Employee Misclassification

We cannot begin to count how many US companies thought they could get away with classifying all of their new workers as independent contractors in order to avoid administrative headaches, employment standards, and additional costs, like insurance and payroll. Employee misclassification is bad for business, plain and simple. It is not worth the risk. The Canada Revenue Agency is strict and severe about the issue and violators will be prosecuted. This one mistake could ruin all of your plans of expanding into Canada.

4. Wasting Time Establishing an Administrative Presence

Before you can start operating in the Great White North, you have to establish an administrative presence in the country. This involves a lot of time and bureaucracy. You will need to set up accounts and infrastructure, register with the correct government bodies, and fill out a lot of paperwork.

Setting up an administrative presence can significantly slow down your expansion, which can harm your bottom line. Many US companies have made this mistake. Instead of falling into the same trap, partner with a professional employer organization. This will allow you to skip many time-consuming and tedious procedures that come with setting up shop, so you can get right to operating your new business as soon as possible.

5. Managing Payroll, HR, and Compliance Alone

As we mentioned above, Canadian employment legislation is complex but must be diligently followed. US companies often try to handle tasks like payroll, human resources, and compliance in house, which is extremely risky. It can lead to costly mistakes and non-compliance.

Instead, your PEO can take over the legal responsibility of your new Canadian employees and many of your administrative tasks, including payroll, human resources, and compliance. Partnering with a PEO is a smart risk management decision when you have little experience and knowledge of Canadian regulations in these areas.

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

Topics: Business Expansion

7 Considerations When Outsourcing Payroll

Posted by Stacey Duggan

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Jan 20, 2017 9:00:00 AM

7-Considerations-When-Outsourcing-Payroll.jpgThere comes a time when all business owners will consider whether they should keep processing payroll in house or outsource it to a third-party processor company. This one decision can have significant impacts on many of your functions and departments. As such, it shouldn’t be taken lightly.

Outsourcing payroll comes with a host of benefits, but it isn’t the right decision for every business owner.

Before you decide to outsource, here are some factors to consider.

1. Workforce Variations and Peculiarities

Some companies’ payroll processing is relatively simple. If you only have a few employees and the process of paying them is straightforward, then it could be best to keep managing it in house. However, companies that have many workforce variations and peculiarities might find it best to outsource.

For example, if you have a mix of full-time, part-time, seasonal, and contingent workers, your payroll will be more complex. The same is true if you’re constantly onboarding and terminating employees. In addition, having workers in multiple provinces and territories can also make payroll more challenging, as can the offering of savings accounts, retirement accounts, health plans, and cafeteria plans. The more complex your payroll, the better the chances that outsourcing payroll is the right call.

2. Data Protection

Within your payroll management software, you will house sensitive information, including employees’ social security numbers, banking details, and salary information. It’s important to think objectively and understand just how safe that information is on your server. What’s more, it’s important to consider whether you would be comfortable with that sensitive data leaving your building and being stored externally with a payroll service provider. In most cases, however, payroll providers have stronger data protection protocols than most businesses.

3. Accuracy

If there is any function in your business that absolutely must be 100% accurate, it’s payroll. Your employees expect it and depend on it. As does the CRA. If you’re finding yourself making payroll mistakes all too often, then outsourcing payroll may be a wise decision to make in order to avoid employee dissatisfaction, a poor reputation, and fines and penalties. Payroll and tax errors happen—but they shouldn’t be a common occurrence.

4. Compliance

Compliance with payroll and tax regulations as well as employment standards for the payment of wages isn’t to be taken lightly. If you’re having trouble keeping up with changing legislation, understanding the nuanced and complex laws that you must follow, or paying for noncompliance far too often, outsourcing payroll is a good idea. Let payroll experts, who are well versed on legislative requirements, handle the task of ensuring that your payroll is compliant with all laws and regulations.

5. Accountability

In the event that mistakes occur, payroll is delayed, or laws are broken during the process of payroll, do you want to be the one accountable for fixing the problem quickly and efficiently? Do you want to be the one responsibility for fines and penalties for noncompliance? By outsourcing payroll, you can place some—if not all—of the accountability on the payroll company if things go wrong.

6. Cost

Cost is an important consideration when outsourcing payroll, although it shouldn’t be the only consideration. Many business owners falsely believe that outsourcing will cost more than processing payroll in house when in fact, many businesses can benefit financially from outsourcing. If you’re paying too much in human capital, software, equipment, supplies, and fines and penalties when processing payroll in house, then outsourcing can be the most cost-effective choice. Compare different providers’ fees and charges before choosing a payroll service provider.

7. Time

If your payroll process is simple and straightforward, it may take you no time at all. But for most businesses, payroll is a time-consuming and draining function. Either too much of your time is spent on the process or your HR personnel’s productivity and efficiency is reduced due to payroll processing on a regular basis. Either way, if you feel like you’re constantly trying to keep up with pay period after pay period and have little time left over for your core business, it’s a sign that it’s time to outsource. Outsourcing this function can save you considerable time.

7 Signs It's Time to Outsource Payroll

Topics: Payroll Processing

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