As 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.

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. 

You'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.