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U.S. Employers Beware: 4 Major Changes to Saskatchewan’s ESA

Posted by Stacey Duggan

|

Jul 16, 2014 8:30:00 AM

U.S. Employers beware: Saskatchewan has updated their ESAAs an American or foreign employer of Canadian workers, you need to protect yourself from ESA violations. The government of Saskatchewan made significant changes to their separate pieces of Canadian employment legislation regarding employment standards, occupational health and safety and Canadian labour relations.

The previous versions of Saskatchewan’s Canadian employment laws were found separate from each other across different employment related pieces. As of April 29, 2014, the government of Saskatchewan announced a new Employment Standards Agreement to tie all those pieces together.

If you are an American or Foreign employer paying Canadian employees please take note that Canadian labour standards in Saskatchewan have changed:

1. Minimum Wage Changes

The current minimum wage in Saskatchewan is $10.00 per hour with an increase of twenty cents taking effect on October 1, 2014. Saskatchewan’s ESA sets out that any changes to the minimum wage will now be announced on June 30 of each year and any changes will take effect on October 1 of each year. Furthermore the minimum wage in Saskatchewan will now be indexed to the consumer price index.

2. Hours of Work and Overtime 

The ESA now allows employers to schedule their Canadian employees for either four 10 hour workdays or five 8 hour workdays. Employers and employees can also choose to average an employees work hours over 1, 2, 3 or 4 week schedules without a work permit. Overtime pay can now be banked by employees.

3. Leaves of Absence 

Service requirements for Maternity, Parental and Adoption leaves are reduced from 20 weeks to 13 weeks. 
New Leaves in the ESA include: Organ Donation Leave, Critically Ill Child Care Leave, Crime Related Child Death or Disappearance Leave and Citizenship Ceremony Leave. 

4. Termination 

Workers in Saskatchewan with more than 13 weeks of continuous employment are now entitled to notice or pay in lieu upon termination of their employment. 

Hiring workers in another country is great for expanding business but risky for Employment Standards Act violation liability. Staying on top of new regulations in the Canadian workforce is difficult. Gaining the services of an Employer of Record service provider (similar to a PEO) like The Payroll Edge allows U.S. and foreign companies the freedom of expansion without the compliance and potential for violating Canadian employment law.

For more Canadian employment law updates and payroll tips, subscribe to our blog. Click here for more information on our services or contact us to hear about how our Professional Employer Organizations helps hundreds of American and foreign companies get competitive while staying compliant.

A U.S. Company Looks to Expand Tts Workforce in Canada

Topics: US Firms Expanding into Canada, Employment Standards Act, Employer of Record, ESA, ESA Violations, ESA Compliant, Canadian Employment Laws, Employee Relations, American Business in Canada, Paying Canadian Workers, Paying Canadian Employees

U.S. Employers: Navigate Canada’s Employment Standards Carefully

Posted by Ray Gonder

|

Apr 25, 2014 9:39:00 AM

Ontario's Employment Standards Poster is required to be displayed in Canadian workplaces. Call The Payroll Edge to get employer of record services

 

 

As seen on First Reference Talks “Navigating Ontario’s Employment Standards Act” by Doug Macleod

Did you know as an employer you are required by Canadian Law to post a “What you should know about the Employment Standards Act” in your workplace for your employees to see? The Employment Standards Act is in place to set minimum standards for workplaces in Ontario. Most Canadian workers living in Ontario are covered by the act whether they are employed by an American employer or a Canadian company. 

If you’re an American company employing and paying Canadian workers, here are a few regulations from the Employment Standards Act you should follow when hiring and paying Canadians:

 

  • Canada’s Minimum Wage varies by province. In Ontario, minimum wage will be $11.00 per hour beginning in June 2014. Please note the minimum wage for servers, students and nannies varies.
  • Employers are required to pay Canadian employees (including temporary and contract workers.) for statutory holidays –even if they did not work that day. Employees who work on stat holidays are entitled to time and a half (overtime pay).
  • Employers must pay Canadian workers overtime pay after 44 hours in one work week.
  • Canadian workers are entitled to two weeks’ vacation for every 12 month period of work. Most employees are entitled to a minimum of 4% vacation pay.
  • A reasonable notice of termination must be given to Canadian employees who have worked for their employer for longer than 3 months’ time which is considered the “probationary period”.
  • There are different unpaid leaves of absences an employer is required to give their employees; Pregnancy and Parental Leave, Reservist Leave, Organ Donation Leave, Personal Emergency Leave and Family Medical Leave to name a few. Length of time for each unpaid leave of absence varies. During a leave of absence, a Canadian employee’s seniority is not affected by their leave and benefits offered before a leave are still required to be paid by the employer during a leave.

The Employment Standards Act can be examined in further detail here. Please note these ESA regulations can change depending on workplace, industry, age, length of employment and other factors so be sure to use the tools on the Canadian Ministry of Labour website.

Failing to comply with the ESA could result in hefty fines, penalties and in some cases persecution whereby American and foreign employers cannot plead ignorance as an excuse. If you’re doing business in Canada, you must know the rules to protect yourself, your employees and your reputation.

If you’re an American looking to hire and pay a Canadian worker consider an Employer of Record service. An EOR (similar to a PEO in the United States) is a great option for American and foreign employers who aren’t interested in learning a new set of rules in employment law. Contact The Payroll Edge today for more information. 

7 Signs It's Time to Outsource Payroll

Topics: Employment Standards Act, ESA, ESA Violations, ESA Compliant, U.S. Business operating in Canada, American Business in Canada, Compliance, Canadian-Based EOR, Canadian EOR

Canadian vs. American: Drug Testing & Background Checks

Posted by Stacey Duggan

|

Apr 22, 2014 8:55:00 AM

Canadian vs. American: Drug Testing and Background Checks

Background Checks and Drug Testing

These two often go hand in hand in the U.S. and are a precursor to employment but in Canada the rules and perception surrounding drug testing and background checks are very different.

Drug testing a potential employee is rarely permitted in Canada and is not worth the legal risk with the Human Rights Commission. Although this issue has seen some press as of late, the majority of Canadian employers are not permitted to maintain policies in regards to pre-employment drug testing and random drug testing during employment. The exceptions are safety sensitive positions where an accident or incident has occurred or where being ‘under the influence’ could cause irreparable damages or death.

A great example of this can be seen in the recent lexology article ‘Suncor random drug and alcohol testing decision released’ written by Caitlin Nobes; 

Recently in Alberta, with the oil industry booming the issue of safety has come up because workers living on worksites are suspected of being intoxicated while working. Suncor was set to begin random drug testing on their employees but it was put on hold due to an injunction and the panel who made the decision said “the program cannot be justified” and “In our view, the evidence does not demonstrate a culture at the Oil Sands Operations where the consumption of alcohol is so pervasive as to be accepted by employees, where employees go together to drink openly and where such activity is either condoned or encouraged by management’s practices or inaction”

Unifor Local 707A President Roland Lefort, who represents the workers at the affected sites says:

"Random drug testing of workers that have done nothing wrong is a violation of their basic rights, we will work with Suncor to achieve the highest possible levels of workplace safety with education and prevention, not invasive medical procedures."

The practise of drug testing employees is for the most part, considered a human rights violation in Canada.

Unlike in the U.S., it is not common practice to run a background check on every potential employee. Although there is no law in regards to this, it is best practice in Canada to only run a background check on a potential employee if they will be engaged in a job working directly with money or highly sensitive information. Many times U.S. companies have run these checks on a Canadian out of habit and end up with a disenchanted potential hire.

For those American companies keen on hiring Canadian employees without a good understanding of the rules and regulations to do so, should engage with an Employer of Record (EOR) service for legislative and legal compliance. Canadian EOR's (known as PEO's in the United States) can ensure seamless integration into the Canadian market without the daunting task of understanding foreign employment compliance.

For more information on our Employer of Record Services
Contact one of our Employer of Record specialists.

 

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

Topics: EOR, Professional Employer Organization, Employment Standards Act, Canadian Employer of Record, American PEO, American Business in Canada, Compliance, Canadian-Based EOR, Canadian EOR

Alberta's Minimum Wage Increases September 1, 2013

Posted by Stacey Duggan

|

Sep 3, 2013 10:40:00 AM

Alberta Human Services

 

 

Canadian payroll providers take note; the minimum wage in Alberta increases as of September 1st.

Most Alberta employers must pay their employees, including students and youth, at least the minimum wage. The minimum wage in Alberta is set out in the Employment Standards Regulation and is as follows:

  • an hourly minimum wage of $9.75 ($9.95 effective September 1, 2013) for most employees;
  • an hourly minimum wage of $9.05 for employees serving liquor as part of their regular job;
  • a weekly minimum wage of $389 ($397 effective September 1, 2013) for many salespersons, including land agents and certain professionals; and
  • a monthly minimum wage of $1,854 ($1,893 effective September 1, 2013) for domestic employees.

However, certain categories of employees are exempt from the minimum wage requirement in the Regulation.

For more information visit the Government of Alberta Website

 

Topics: workforce compliance, Employment Standards Act, Government Compliance, Minimum Wage, Minimum Wage Increas, Minimum Wage Increase

Don't Make a Mistake by Hiring the Wrong Payroll Clerk

Posted by Ray Gonder

|

Aug 19, 2013 9:00:00 AM

Hiring Payroll ClerkOn the surface, your payroll clerk may not seem to be one of the most important players in your company. The payroll clerk doesn't make big decisions, doesn't interact with clients, and doesn't tangibly affect your bottom line. But hiring the wrong payroll clerk can have a huge impact on the way your company runs. Whether you realize it or not, your payroll clerk has great responsibility when it comes to keeping you compliant with government agencies. Therefore, your company's legal status and reputation are in the hands of your payroll clerk.

But how do you know if you've hired the right payroll clerk? What kinds of questions do you need to ask to ensure that you're putting your trust in the right person?

Questions to Ask a Potential Payroll Clerk

When interviewing candidates or payroll processing firms to handle your payroll, ask open-ended questions that will allow them to elaborate on their experience. This helps you to get a better grasp on their capabilities, education, and experience.

1. How do you ensure that payroll is completed on time?

A good payroll clerk is organized enough to have tried-and-true systems in place to ensure that each payroll step is completed in a timely manner. The detail in the candidate's description to this answer will help you to understand his or her depth of experience.

2. Do you have experience with submitting payroll deductions to the government?

This question is very important because proper deduction remittance is key to your company's compliance and legal standing. The candidate should mention federal withholding, Employment Insurance, CPP, workers’ compensation, and, in Ontario, EHT.

3. Tell me how you handle payroll year-end requirements.

Not only must payroll clerks handle the paycheque-to-paycheque clerical work, but they also must handle year-end governmental requirements like T-4 slips and direct reporting of filings to authorities.

4. How do you make sure that payroll is in compliance with the Employment Standards Act and the Canada Revenue Agency?

Legislative changes result in policy changes at the Canada Revenue Agency, and it's the responsibility of Canadian employers to keep up with these changes. When you hire a payroll clerk, you expect that person to keep up with these changes for you. If the person you're interviewing can give you specific information about the Employment Standards Act, you're in good hands.

5. What do you do when you need to communicate with someone at the CRA?

It's inevitable: questions will arise from time to time about situations unique to your company that involve the CRA. If your potential payroll clerk doesn't know how to reach someone who can answer questions, you could find yourself in a small crisis. Hiring a payroll clerk with a history of communication with tax authorities puts you in a great position. You'll be able to get questions answered in a timely manner and minimize your chances of non-compliance.

6. How can you help us with other human resource issues?

It never hurts to hire a payroll clerk who understands the ins and outs of human resources. Having an employee on board who can handle Ministry of Labour claims, Workplace Injury Claims Management, standard employment agreements, and employee orientation and training will be a great boon to your company, helping you to navigate some of the trickier employee issues common to Canadian businesses.

Once you find that perfect payroll clerk or outsourced payroll provider, you'll be able to delegate all of your payroll-related tasks, knowing that your company's payroll is on-time, compliant, and properly remitted.

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

Topics: Payroll Service Provider, Outsourced Payroll Service, Employment Standards Act, Government Compliance, Canada Revenue Agency, Payroll Clerk, Hiring a Payroll Clerk

Doing Business in Canada - Employment and Labour Laws Are Not the Same as in the U.S.

Posted by Ray Gonder

|

Aug 7, 2013 10:00:00 AM

American Businesses in Canada3Although the United States and Canada have much in common, there are some significant differences in the ways the two countries handle business and labour. This is especially important for American companies to consider when they think about carrying on business north of the border. U.S.-based businesses operating in Canada soon find, for instance, that they can't use their accustomed methods of hiring, managing, and terminating employees.

Minimum Standards and Entitlements for Employees

Canadian federal and provincial governments have enacted laws regarding minimum standards and entitlements for employees, and as an employer, you need to comply with these standards. If you fail to comply, you could face personal penalties and sanctions, even if you're not a Canadian citizen.

Some of these minimum standards and entitlements include minimum wages, work hours, overtime pay, statutory holidays, guidelines regarding vacation and vacation pay, pregnancy and parental leave, notice of termination of employment, and severance pay. In the U.S., hourly workers are normally exempt from some of these standards and entitlements, but this is not necessarily the case in Canada.

Labour Relations

One marked business difference between the United States and Canada is that Canada is much more union-friendly. About 30% of Canadian employees belong to unions, compared with about 13% of American employees.

Therefore, American companies need to be aware of policies and guidelines involving unions. One such guideline that may surprise U.S. employers is that in Canada, when a business is sold or transferred, the union has the right to carry over the bargaining rights and collective agreement to the acquiring employers.

Termination of Employees

The American concept of "employment at will" does not exist in Canada, and understanding the process of terminating employees is extremely important for American companies operating in Canada. Every Canadian jurisdiction provides for minimum termination notice periods or pay-in-lieu of such notice. Depending on various factors, termination notice periods could be as long as 24 months, so it's imperative that employers understand the laws before terminating an employee.

These and other differences between the United States and Canada can prove challenging to American businesses operating in Canada. One of the best ways to overcome these challenges is to have a partner north of the border who can steer you through the legal and business world so your business can thrive in its new locale.

With a Canadian payroll partner, or Employer of Record (EOR), like The Payroll Edge, you don’t need to worry about establishing a Canadian administrative presence, registering and maintaining accounts with any of the Canadian governmental authorities, nor will you need to establish a Canadian banking, financial, and insurance infrastructure, or make filings and remittances to Canadian tax authorities.

A Canadian Employer of Record stays on top of Canadian employment regulations and protocols, so you can focus on operating and expanding your business.

To learn more about Employer of Record services and operating your American business in Canada, contact The Payroll Edge. Our knowledgeable staff can answer your questions and help you to reach your goals.

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

Topics: EOR, Employment Standards Act, Canadian Payroll Service, Employer of Record, U.S. Companies operating in Canada, Canadian Employer of Record, American Business in Canada, Labour Relations

3 Common CRA Remittance Pitfalls

Posted by Stacey Duggan

|

Jul 24, 2013 9:00:00 AM

3 Common CRA Remittance PitfallsIt seems that remitting your payroll deductions to the CRA should be a simple, straightforward process, and yet, Canadian businesses run into problems time and again. Part of this has to do with legislative and bureaucratic changes that catch people unawares. Sometimes small business owners just have too many things on their minds; it's hard to keep up with everything, especially with things like CRA remittances which don't help your business to stay afloat or improve your bottom line. Let's take a look at three common CRA remittance pitfalls and how to avoid them.

1. Not sending in your remittance on time

This is probably the biggest mistake that employers make, and it's no surprise. The money collected from payroll may sit in your business account for weeks or even months before it's due to the CRA, so it's easy to forget about remitting. Do your best to stay on schedule, however, because the penalties for failing to remit are stiff and increase the more time you take. Not only the fee but the whole amount is subject to interest making a late payment much more costly than the timely payment would have been.

Companies with a 12-month history of remitting compliance and who have a monthly withholding amount of less than $3,000 may be eligible to remit quarterly instead of monthly. You will be notified by the CRA if your business qualifies for quarterly remittance. Otherwise, you'll be expected to remit monthly, and it's important that you keep up with your deadlines.

2. Remitting less because you're treating some employees as independent contractors

A worker engaged with your company who has a registered business, doesn’t always qualify to be paid as an independent contractor in the eyes of the CRA. As a business owner, you need to be aware of how to properly classify independent contractors in order to be compliant. A finding of misclassification can lead to the payment of both the employee and employer portion of the remittances going back as far as the initial engagement. If the CRA finds that you have violated the law, you will also be charged interest and penalties, which can add up very quickly.

3. Calculating remittances incorrectly

It's a lot to keep track of, but you need to remit CPP contributions, income taxes, and EI premiums from your employees' earnings, along with your share of EI premiums and CPP contributions for each employee. Recognizing taxable benefits and calculating then remitting them correctly is another area that is often misunderstood by business owners. Your employee is considered to have received a benefit if you pay or provide to him or her something that is personal in nature such as free use of property, goods or services. If the benefit is deemed taxable you must add the fair market value of the benefit to the employee’s income and tax accordingly.

One thing you can do to help with calculating payroll deductions is to use the CRA's Payroll Deductions Online Calculator. Instead of looking up deduction amounts on the provincial and territorial tables, you can simply enter your data into the calculator. Remember, though, that you assume the risk associated with using the CRA's calculator. If you end up remitting the wrong amount, you can't use the calculator as your excuse.

By taking care with these three CRA remittance pitfalls, you can avoid most of the headaches and frustrations encountered by business owners in the reporting area. Another alternative is to outsource payroll processing and let someone else take care of CRA remittance for you. When you're sure that your CRA remittance is handled correctly, you can face the details of your business confidently and irreproachably.

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

Topics: Payroll Service Provider, Canadian Payroll Deductions, Payroll Tax Calculations, Employee Payroll Deductions, Employment Standards Act, Best Payroll Calculator, MOL, ESA, ESA Compliant, Employee Payroll Tax

How ESA Violations Can Put Company Directors in Jail

Posted by Ray Gonder

|

Jul 19, 2013 9:00:00 AM

http://i.istockimg.com/file_thumbview_approve/14624102/2/stock-photo-14624102-group-of-men-in-prison-cell.jpgYou're a hard-working, law-abiding citizen. In fact, you have worked hard enough that you employ other people who count on you for their pay cheques and benefits. You should be aware, however, that you could face severe fines and even jail time for violations of the Employment Standards Act (ESA).

What is the ESA?

Signed into law in 2000, the Ontario ESA regulates wages, work hours, and workplace health and safety in Ontario for provincially-regulated companies. The Ontario Ministry of Labour (MOL) enforces these regulations, educates and informs employers about how to comply with ESA regulations, investigates potential violations, and resolves complaints from employees.

It can be difficult to know all of the standards that make up the ESA. To help, the ESA produces a workbook to help employers know and understand their obligations under the Employment Standards Act. For starters, the workbook lists ten different areas in which employers need to be well-versed to be ESA-compliant:

  1. The ESA Poster
  2. Payment of Wages
  3. Wage Deductions
  4. Work Hours
  5. Eating Periods
  6. Overtime Pay
  7. Minimum Wage
  8. Public Holidays
  9. Paid Vacation
  10. Termination and Severance

You might think that common sense could help you to navigate these standards, but that's not necessarily true. For example, in the workbook section about Public Holidays, you'll read, "Although vacation pay is not considered to be part of one's regular wages, the calculation for public holiday pay includes any vacation pay that was payable to the employee during any of the four work weeks prior to the work week in which the public holiday fell." Clearly, ESA standards are not always obvious or even, well, clear. And this leads us to the problem at hand.

ESA Violations

If you take a look at convictions under the ESA for March of this year, you'll see that there are several different ways that employers have violated the Employment Standards Act. One company failed to retain records, another failed to make records, several failed to pay for overtime, and another failed to give an eating period during a work shift. Most of these ESA violations resulted in fines of less than $500, but this shouldn't make you feel that you can relax when it comes to abiding by ESA standards. In fact, at least one Ontario employer is currently serving jail time for non-compliance.

The owner of six Ontario companies ignored orders by an MOL officer to correct wage payment problems with 61 employees at all of the six companies he owned. Under ESA, a director of a company can be held personally liable for violations of the law, including failing to pay wages. The Ministry of Labour charged the owner and his companies with failure to comply with orders, to which he pleaded guilty. He was fined $280,000 and ordered to spend nine months in prison.

If the owner had complied with the initial orders from the Ministry of Labour, he would certainly be in a much better position today. Perhaps he ignored the orders because he had too much to do and felt that ESA violations were not a big deal.

You don't have to spend a lot of time and resources complying with the ESA. But if you feel you don’t personally have the time to read through the workbook and answer all the questions, the specialists at The Payroll Edge can take care of that for you. Or if you've already found yourself involved with ESA violations, we can help you with that as well, mediating with the Ministry of Labour and helping you to resolve past infractions, while making sure your programs and policies will keep you in the clear in the future.

To find out more about ESA violations, contact us at The Payroll Edge.

7 Signs It's Time to Outsource Payroll

Topics: Ministry of Labour, Payroll Service Provider, Outsourced Payroll Service, Employment Standards Act, Employee Policies, MOL, ESA, ESA Violations, ESA Compliant

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