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Canadian vs US Employment Laws: What International Employers Need to Know

Posted by Karen McMullen


Jun 5, 2019 9:00:00 AM

foreign-vs-us-employment-laws-what-international-employers-need-to-knowInternational employment laws pose a challenge for almost any employer who looks to move beyond their national borders. For American companies moving to Canada, the differences between US employment laws and the rules in the new market can be confusing. Similarly, Canadian employers may have plenty of questions about the US laws.

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If you’re crossing the Canada–US border in any capacity, here are some of the most pertinent points you’ll want to keep in mind.

US Employment Laws and Human Rights

One of the biggest points of departure between Canadian and US employment laws is around human rights.

In Canada, the federal Charter of Rights and Freedoms grants Canadians the right to live free of discrimination. The Charter outlines many prohibited grounds of discrimination, such as gender, race, sexual orientation, age, and more. In some cases, Canadian courts have added prohibited grounds to the Charter by “reading in.”

The provinces have also created human rights legislation, which sometimes goes further than the federal Charter. Most provinces use this legislation to help protect Canadian workers and end discrimination in employment.

One example demonstrates how this can impact international employers. Some interview questions, such as those about marital status, are considered discriminatory in most provinces. Asking about religion, family status, or health could also be considered discrimination.

Canadian employees can start proceedings against their employers by complaining to their provincial Human Rights Commission. In the US, by contrast, employees would usually sue their employer independently.

Background Checks and Drug Testing

In the US, it’s very common for employers to require a background check. Some may also require a drug test as part of the hiring process.

In Canada, these checks are rare. Much like certain interview questions, background checks and drug tests could be considered discriminatory. Drug testing is allowed very rarely, and it’s usually not worth the risk of having a Human Rights Commission investigate.

Background checks in Canada are becoming more common, especially for certain professions, such as working with children and other vulnerable persons. If an employee handles money, merchandise, or sensitive information, a background check may be recommended.

Working Hours, Breaks, and Leave Time

Other major differences between Canadian and US employment laws are around working hours, breaks, and leave.

Federal US employment laws are rather sparse on regulations for these areas. There are no maximums on the number of hours employees can work, provided they’re compensated fairly. The US is also one of just three countries that doesn’t have mandated breaks for employees.

Individual states can create their own rules, but only a handful provide paid lunch breaks. Paid leave is also at the employer’s discretion. There’s no need to provide paid vacation, for example, unless you want to.

Canada presents almost the polar opposite situation. Most provinces have legislation requiring employers to offer paid and unpaid breaks, and capping the number of hours employees can work. Most laws lay out the maximum time an employee can work without a break, maximum shift lengths, minimum time between shifts, and maximum number of hours to be worked in a week.

The Canadian provinces also include legislation for paid time off, such as mandatory vacation and paid leave.

You Must Be Compliant

In both the US and Canada, compliance is important. In Canada, however, employers may find the rules are stricter, and there are more of them. There are also more bodies dedicated to ensuring compliance.

A great example is payroll and taxation. You’ll need to keep records in Canada. Not doing so could result in a fine or even a criminal charge. You could be asked to provide evidence of record-keeping to the Canada Revenue Agency or a provincial body.

If you need help staying on top of your compliance, you’re not alone. Get in touch with a PEO. Discover how we can help.


Topics: Compliance and Legislation

Bill 66: What International Companies Employing Canadians Need to Know

Posted by Ray Gonder


May 29, 2019 9:00:00 AM

bill-66-what-international-companies-employing-canadians-need-to-knowInternational companies doing business in Ontario, Canada, have had a lot to keep an eye on recently. The provincial government has been rolling out initiatives to keep Canada’s most populous province “open for business.”

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So far, this has included measures such as putting a freeze on minimum wage increases and revising some policies about paid and unpaid leaves for employees. In April 2019, the government passed Bill 66 into law.

With the passage of the bill, many business owners and managers have asked how their workers will be affected. This quick survey will tell you what you need to know.

International Companies Should Review Revisions to Legislation

Bill 66, known as the Restoring Ontario’s Competitiveness Act, makes revisions to existing Ontario employment legislation.

The Act made immediate changes to the Employment Standards Act, 2000 and the Pension Benefits Act. International companies who employ Ontario workers will need to review the new legislation to make sure their policies are in compliance with the revisions.

Bill 66 also made changes to the Labour Relations Act, 1995. These adjustments will come into effect at a later date.

Effects on the ESA

One of the key areas of change is the overtime requirements in the Employment Standards Act, 2000. The Act originally stated employees could work a maximum of 48 hours per week. If employees were to work more than 48 hours, the employer needed to receive approval from the Director of Employment Standards.

The maximum number of hours of work is still the same, but Bill 66 removes some of the red tape for employers and employees in workplaces where overtime is common. Employers and employees can still enter into an agreement for employees’ hours to exceed the ESA maximum.

The agreement no longer needs approval from the Director of Employment Standards, which makes it easier for employers and employees to implement overtime agreements. In unionized workplaces, bargaining units can enter into these agreements.

Employers can also average the hours an employee works over a specified period in order to limit overtime pay. Bill 66 removes the necessary approval from the Director of Employment Standards for overtime averaging. It does introduce new requirements, such as defining a start and end date for the averaging period. The averaging period also can’t exceed four weeks.

Changes to the LRA and PBA

Bill 66 also made changes to the Labour Relations Act, 1995. The biggest difference here is the new definition of “non-construction employers.” This category now includes hospitals, universities, and many different administrators, among others.

What this does is redefine who is impacted by the LRA and how. The Act treats non-construction employers and construction employers differently. Those who are no longer considered to be part of the construction industry won’t be subject to the industry-specific criteria of the Act.

Bill 66 also made adjustments to the Pensions Benefits Act. The process employers use to convert single-employer pension plans to jointly sponsored plans has changed.

How This Affects International Companies

What does this mean for international companies with Canadian employees living and working in Ontario?

The change that will have the largest effect is the revision to the ESA. With the new overtime requirements, you may have an easier time approving employees’ overtime. You’ll also have more control over how much overtime you pay out.

For international companies that face high rates of overtime, this is welcome news. The overtime averaging allowances make it easier for you to meet staffing needs on a more flexible basis. The removal of the approval from the Director makes implementing agreements faster and easier.

Changes to the LRA will only affect certain employers. If you don’t have a pension plan, the change to the PBA likely won’t affect you.

If you’re concerned about your compliance in light of the changes, get in touch with a PEO. We can help you understand how the changes will affect your business.


Topics: Compliance and Legislation

2019 Provincial Holiday Schedule in Canada

Posted by Corinne Camara


Jan 30, 2019 9:00:00 AM

2019_Provincial_Holiday_Schedule_in_CanadaWith a new 2019 calendar tacked up on your wall, you’re already beginning to plan for public holidays across Canada. Holidays can affect everything from shipments to payroll.

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As you map out the year, keep this schedule of provincial holidays handy.

Canada-Wide Statutory Holidays

The federal government mandates several statutory holidays throughout the year. Although the provinces and territories are responsible for determining holidays in their jurisdictions, they generally adopt most of the federal scheduled holidays.

The first one is New Year’s Day. The next federal scheduled holiday doesn’t occur until Easter, which falls on the weekend of April 20-21 in 2019. Good Friday, April 19, is a statutory holiday.

Since Easter always falls on a Sunday, only businesses that are open on Sundays need to worry about this holiday. Many businesses opt to take off the Monday after Easter, known as Easter Monday, to ensure their workers get a holiday. Easter Monday is a statutory holiday for federally regulated businesses such as post offices and banks, but it is not mandatory across Canada.

Victoria Day, which is celebrated on the Monday on or before May 24th, is also a federal statutory holiday. Most provinces give this holiday as well, although in Quebec, it’s known as National Patriots Day. This year, it falls on May 20.

Canada Day is usually given on July 1, although employers can opt to move this holiday to the Friday or Monday closest to July 1 if they’re not open on weekends. This year, July 1 is a Monday.

Labour Day is the next federally scheduled holiday, falling on the first Monday of September. Thanksgiving is celebrated on the second Monday of October. The year closes out with Christmas and Boxing Day on December 25 and 26, respectively.

A Holiday in February

The provinces are allowed to adopt their own holidays, which means there’s some variation across Canada. Several provinces mark a holiday in February, for example, but not all of them.

The third Monday in February is a holiday known as Family Day in Alberta, British Columbia, New Brunswick, Ontario, and Saskatchewan.

Prince Edward Island, Nova Scotia, and Manitoba also celebrate a holiday at this time. In PEI, it’s known as Islander Day, and it’s known as Louis Riel Day in Manitoba. Nova Scotia celebrates Nova Scotia Heritage Day.

Yukon also observes a February holiday, but about a week later. Northwest Territories, Nunavut, Quebec, and Newfoundland have no holiday at this time.

The August Long Weekend

Several provinces also take a long weekend in August, usually around the first Monday of the month. In Alberta, it’s called Heritage Day, while Saskatchewan recognizes this as Saskatchewan Day.

New Brunswick has New Brunswick Day, BC has British Columbia Day, and Nova Scotia calls its holiday Natal Day.

Ontario, Nunavut, and Northwest Territories call this holiday either the Civic holiday or Provincial Day.

Other Provincial Holidays

Remembrance Day falls on November 11, and it’s technically a national holiday. Some provinces, however, have elected not to observe it. This includes Ontario, Manitoba, Quebec, and Nova Scotia.

Easter Monday is a national holiday, but it’s only officially recognized in New Brunswick, Northwest Territories, Nunavut, and Quebec. April 22 is also St. George’s Day in Newfoundland and Labrador.

Northwest Territories and Yukon both recognize National Indigenous Peoples Day on June 21. Quebec celebrates St. Jean Baptiste Day a few days later.

Nunavut follows Canada Day with Nunavut Day on July 9.

As you can see, there’s considerable variation across the country. Keep a close eye on local observances and holidays, and you’ll be able to plan and schedule with ease for 2019.

What US Companies Need to Know about Paying Employees in Canada

Topics: Compliance and Legislation

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