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Canada Hiring Basics for International Companies

Posted by Anna Mastrandrea

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Dec 31, 2018 9:00:00 AM

Canada_Hiring_Basics_for_International_CompaniesAlthough Canada is a smaller market than the US, it shares many similarities with the American market. Canadian and American cultures often follow similar sensibilities, and the logistics of shipping products around a geographically enormous area are as present in Canada as they are in the US.

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If you want to expand into Canada, however, you’ll probably want to hire a few Canadian staff members to help with the expansion. As with all countries, Canada has its own employment law. Hiring here can pose challenges for international employers. That’s why it’s important to start with the basics.

Canadian Employment Is Contractual

This particular fact can be difficult for American employers and those from countries where “at will” employment is legal. In Canada, there is no such thing as “at will” employment.

All employment in Canada is considered contractual, which means contract law applies. If one party seeks to break the contract, there are certain protocols to be followed.For this reason, it’s best to lay down the terms of employment in a written contract.

If there is no written contract, then courts may impose obligations on you as the employer. You can create limited-term contracts.

Canadian Labour Law Has More Protections and Worker Entitlements

Employers from European countries may find Canadian labour law lax in terms of protections and rights for workers. American employers and those from other parts of the globe, by contrast, may find the rules in Canada to be more demanding.

A good example is paid parental leave. Canadian labour law offers up to a year of paid parental leave, in addition to laying out other paid and unpaid leaves. Employers, for example, must give workers bereavement leave.

There Are Provincial Differences in the Rules

Work hours, minimum wage, overtime, and even holiday pay and vacation time are governed by provincial laws. You’ll need to be familiar with the requirements in every province you operate in.

Federal law applies across the country, but it is only applicable to federal employees.

This means minimum wage in Ontario is different than minimum wage in Alberta. It also means Saskatchewan and Quebec can have different formulas for how to calculate vacation time, and even for which holidays workers are entitled to.

The rules in any province can be complex, so it’s best to work with an expert team to navigate them.

Ending Employment Can Be Difficult

Since Canadian employment is considered contractual, it can be difficult to end employment arrangements. In Canada, employers usually need what’s termed just cause to end employment.

This is a protection against discrimination. A just cause might be downsizing your operations. It might also be poor performance on the employee’s part. It’s your responsibility to prove that letting someone go is the only choice.

You’ll also need to observe notice periods. The longer an employee has worked for you, the more notice you’ll need to give them. If you can’t give notice, you’ll be required to pay severance.

Protecting Identities and Information

The Canadian Charter of Rights and Freedoms entitles Canadians to live their lives free of discrimination on a number of grounds. During the hiring process, you’ll need to be careful of bias and discrimination. There are certain questions you can’t ask, for example, such as whether a person is married.

You’ll also need to be clear about what information you collect from employees, how it’s stored, and how it’s used within your company.

As you can see, Canadian employment law is quite different from US labour law or that of any other country. If you need a hand navigating these tricky legal waters, don’t hesitate to reach out.

What US Companies Need to Know about Paying Employees in Canada

Topics: human resources

Anna Mastrandrea

Anna Mastrandrea is the team lead of the payroll department at The Staffing Edge. For over 10 years, Anna has been providing the highest level of customer service to our members. Anna is an important part of our back office operations, running payroll for all of our members assignment employees, ensuring all proper payroll deductions have been set up, billing clients, and processing record of employment and filings to Service Canada. Her goal is to make sure all of our members assignment employees are paid properly, and most importantly, on time. Anna’s passion for challenges, learning, and problem solving makes her a great asset for our members, as no one member’s situation is ever the same. When Anna is not on the job, she enjoys spending time with her family, indulging her love for great wines, and playing volleyball.
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