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5 Tips for Higher Employee Retention Rates

Posted by Corinne Camara

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Jun 16, 2017 12:00:00 AM

5 Tips for Higher Employee Retention Rates--.jpgWhen it comes to your company's growth, employee retention pays off. By keeping your current employees as long as possible, you will always have highly experienced people on staff. It will also make its mark financially, as $11 billion is lost to employee turnover every year. Keeping your employees on staff starts with their happiness and engagement. To encourage this attitude in your company, and to increase your retention rates, follow these simple tips. 

Encourage Development

By providing constant training, seminars, and workshops, you are making an investment in your employee's careers. They will not only appreciate this effort, but will likely also show improved job performance.

Listen Well

Reach out to your employees for feedback and actually listen. Ask them what they expect from their full-time employee benefits program, company training, and culture. Notice what points are coming up multiple times and look into making those changes.

Offer Quality Benefits

Whether you provide group insurance or individual benefits, be sure to offer your employees a wide range of benefits. They all have different needs, so they will appreciate it if you recognize that within the full-time employee benefits program.

Foster Work-Life Balance

Remember that your employees have a life outside of work. Make sure that your company schedule, culture, and benefits are catering to that. Overworked employees are not happy employees. This is another great opportunity to communicate with your employees, asking them what else they expect.

Invest in Company Culture

Your employees should be happy at work. Encourage your entire staff to participate in crafting a company culture. This will bring your employees closer together and offer a benefit for coming to work.

The Bottom Line on Results

Improving employee retention takes time, so do not expect results immediately. As you build your employee engagement and happiness, be sure to include their honest thoughts in the process.

Employees on all levels of your organization will likely have opinions, so instruct supervisors on how to best listen to their employees. Remember to access how your retention effort is going through data collection, both quantitative and qualitative. This way, you can measure which efforts are working and where you can improve. 

7 Signs It's Time to Outsource Payroll

Topics: human resources

What American Companies Need to Know about Employing a Canadian

Posted by Karen McMullen

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Apr 21, 2017 9:00:00 AM

What-American-Companies-Need-to-Know-about-Employing-a-Canadian-1.jpgHiring new employees is an exciting and busy process, butit can get complicated quickly, especially when the new employee lives in a territory outside your own. American companies hiring Canadian employees remotelyneed to be aware of the significant differences that occur when employing non-U.S. residents. 

Employing a Canadian in an American company requires compliance with certain regulations. Here’s what U.S. employers need to know. 

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

Labour Legislation Is a Provincial Matter

Unlike the U.S., employment legislation in Canada is largely a provincial matter.The federal government rules on a minority of employment issues, meaning each province has its own regulations to follow.Employing a Canadian in Ontario, for example, will have different labour rulesthana Canadian employee working and living in British Columbia. 

Where said employee works will determine the pay schedule, the applicable minimum wage rate, holiday and vacation pay, acceptable employee contract terms, and more. Provinces individually outline these minor details for legally employing Canadians, so American companies must do their due diligence beforehand to ensure they’re following the correct provincial standards.While the regulations may appear similar across the provinces, many haveminor variances. 

Agencies and tribunals that deal with work issues, whether discriminatory practices, human rights violations or other issues, also vary. Each province has its own administrative tribunal to handle these situations, and while they all do the same job in principle, each tribunal conducts business in its own way. 

Unions,as well,are governed differently in Canada. Unlike the National Labour Board in the U.S., which governs the entire country’s unionized force, Canada’s unions are run by their own trade and vary between provincial and federal positions. 

If Canadians are employed from several provinces, American employers will need to be sure each individual employee’s management is in line with that province’s human resources, employee benefits, and contractual standards.

“At Will” Termination Isn’t an Option

Should you employ a Canadian, it’s crucial to remember they cannot be terminated “at will.” Unlike U.S. employers who have this option, Canadian employers must have a legitimate reason for termination, and as such, employees are entitled to reasonable notice or pay in lieu of it. 

As legal justification is difficult to prove when firing an employee, severance packages are a popular alternative. American companies need to be absolutely aware of this to avoid lawsuits or possible discrimination charges should they need to terminate their Canadian employees. Unless they’re contractually obligated, American employers can terminate without giving sufficient reasoning, notice, or pay.

Canadian courts place a very high onus on the employer to meet human rights standards to prevent wrongful termination. American companies need to fully grasp what side courts will choose when deciding to terminate. If you’re considering hiring a Canadian employee, fully understand how termination and dismissal works.

Calculating Payroll and Taxes

It’s crucial to correctly calculate employee payroll and deduct the right taxes, in order to submit accurate remittance reports later. Canadian tax remittance reports are submitted to the federal agency namedthe Canada Revenue Agency (CRA).The CRA outlines when these reports are due based on timing and type of company, and late submissions cause problems. Canadian employees have three major tax deductions American employers need to account for: the Canada Pension Plan, Employment Insurance, and income tax. All three are deducted each pay period.

In addition, correct employee classification outlines how said employee is paid, and mistakes here can result in audits, fines, and penalties from the CRA.

American companies should also pay attention to the fluctuating exchange rate to determine the best way to pay their Canadian employees and understand all the financial obligations, including what’s mentioned above, involved when employing a Canadian.

Some U.S. employers find it helpful to outsource these tasks to a Canadian employment of record, to ensure they’re handled correctly.

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

Topics: human resources

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.

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Topics: human resources

How to Terminate an Employee: 3 Guidelines to Follow

Posted by Shannon Dowdall

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Mar 31, 2017 9:00:00 AM

How-to-Terminate-an-Employee-3-Guidelines-to-Follow.jpgTerminating an employee is often an uncomfortable process, but sometimes it’s necessary and a smart business decision. It’s also not as easy as just calling the employee in and telling them they’ve been fired, you have to ensure the correct procedure is followed. Follow these three guidelines to ensure you are legally and ethically okay to terminate an employee.

1. Check the Employment Contract

The employment contract, along with the provincial requirements, outlines the legal means for an employer to terminate an employee. The contract will contain provisions which indicate at what time an employer can fire, and lay out what the employee is entitled to. They’ll also specify a number of other key clauses the employee is entitled to, including benefits, compensation, and termination, while defining reasonable notice or pay in lieu of it. Verify the contract is in line with the province’s employment standards act. If any of the clauses fall below those standards, the courts won’t enforce them.

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

Once you’re legally in the clear, it’s time to draft a termination letter. Consider vetting it by legal counsel to make sure all the necessary standards are met. It should clearly state the purpose(termination), include the end date, outline the reasons for termination, and state any severance benefits. The employee shouldn’t be confused whether the letter means they’ve been fired or it’s a disciplinary time out.

It’s at the employer’s discretion to offer severance above the minimum standards. If an employer chooses this route, ensure the employee signs a release form acknowledging the exchange, and to protect the company from future liability.

2. Keep a Record

All staff should have individual employee files, which hold basic documents like contact information and vacation days, and also record any mishaps or employee errors. Laying this groundwork at the beginning of the employee’s job makes termination easier. The employer can verify it with hard facts, instead of only verbalizing different situations where the employee went wrong. From customer complaints and inappropriate behavior, to consistent failure to meet deadlines, maintain an accurate record to later show the employee. 

Employee expectations should be clear from the beginning. If they’re having problems, the employer should have given them previous chances to improve by holdingregular performance reviews or other meetings. When it’s time to terminate an employee, ideally, the employee should already have an ideaof where they stand in the company. 

The employer should have previously made it clear that there were problems or the staff member wasn’t working well within the team. The employer must be able to give concrete examples of where performance failed, to highlight they weren’t a good fit. At termination, an employer should be able to clearly show the employee that their performance was seriously lacking.

3. Conduct an Exit Interview

The exit interview is crucial for good manners and adequate termination, and is when the employerdirectly communicatestermination to the employee. It’s important that employers are crystal clear about what they say to get this across effectively and accurately to the employee. Having a script prepared ahead of time assures employers what they’ve written is as clear as possible, and overall moves the meeting along.

The exit interview is important for closure of the employee’s time there. It should always be in person, and held in a quiet, neutral part of the office. Be ready to answer the dreaded “Why?” question they may ask. Final documents, such as the termination letter and a release form (if applicable),should already be prepared and ready for signing.

Be honest, brief, and clear. As well as speeding up the process, knowing what to say ahead of time makes it less awkward for everyone involved.

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Topics: human resources

The Differences Between Wrongful Dismissal in Canada and the U.S.

Posted by Ray Gonder

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Mar 27, 2017 9:00:00 AM

The-Differences-Between-Wrongful-Dismissal-in-Canada-and-the-U.S..jpgCanada and the U.S. are intertwined in many ways, but that doesn’t mean the legislation governing similar activities is the same. In regards to letting employees go, the guidelines between both countries have significant differences. Understanding these differences are important to ensuring lawful wrongful dismissal. 

Before moving ahead, let’s define this term. Wrongful dismissal is when an employeeis dismissed without notice. An employer (wrongfully) feels there is just cause for termination. The issue at hand is the length of notice, as the employer has failed to provide the employee with it. The employee feels they have been dismissed unfairly, or without just cause.

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

Division of Powers

In Canada, the majority of power regarding employment standards is controlled by the provinces, with slight variations in each one. Hours and overtime pay are set by the provincial legislation,and employees in different provinces are subject to different rates. For example, if an employer has staff in Saskatchewan and New Brunswick,the company will have separate employment agreements that meetthe standards of the applicable provincial legislation. 

Defining workplace dismissal can have slightly differing details. For example, both Ontario and British Columbia employees look to an act with the same name (the Employment Standards Act), but the wording in each act will vary. While similar agencies exist in the provinces, the agencies will handle the same issues differently. Ontario workers consult the Workplace Health and Safety Board,but a similar disputein Nova Scotia would be handled by the Workers’ Compensation Board. The tribunal idea is the same, but as it’s in a different province, the procedure won’t be identical. 

Unlike the U.S., where many of the key regulations are federally governed, the provinces handle the majority of the employment regulations, with the federal government having a limited number of responsibilities.

“At Will” Employment

Canada has no “at will” employment. While U.S. employers can terminate “at will”, Canadian employers need legal justification or a written agreement to do so. If an employee feels they were fired without cause, the onus is on the employer to prove they did not act in that manner. The threshold is incredibly high in Canadian courts for just cause. As it’s much harder to prove, it commonly results in the Canadian employer providing the employee a severance package. 

The employer is obligated to provide reasonable notice or pay in lieu of it, upon termination. Even if an employee agrees to “at will” termination, employment standards in the various provinces can void this if dismissal doesn’t include all of the minimum rights. It’s absolutely required in Canada and is accompanied with other written variations. Employers are mandated by provincial legislation outlining proper termination of employees, reasonable notice periods, minimum entitlements, and more. 

Understanding the provincial legislation is key to ensuring business owners have correctly dismissed an employee.

Employees with Disabilities

Canada’s human rights legislation leaves an incredibly large duty to employers to accommodate employees with disabilities.While the U.S. also defines disabilities asphysical and mental, Canada alone labels drug and alcohol dependency a disability.

If job short-comings are found through disability, the employer has committed unlawful dismissal unless they can show the business suffered undue hardship by keeping the employee. “Undue hardship” of course varies on context–the workplace and disability of the employee.

Human rights legislation will look to health and safety, financial costs, and a genuine attempt to accommodate said worker. If the attempts were futile or workplace tasks were not reorganized, courts may consider it grounds for wrongful dismissal. But the employee has to do their part as well. Unless it’s a hazard to their safety, they can’t declineto deal with the reset accommodations, or refuse to participate in the revised efforts.

In contract to U.S.-based businesses, Canadian companieshave a bigger responsibility to accommodate workers, regardless oftheir situation.

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Topics: human resources

What Is the Correct Way to Terminate an Employee?

Posted by Corinne Camara

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Mar 22, 2017 9:00:00 AM

What-Is-the-Correct-Way-to-Terminate-an-Employee.jpgFiring an employee is one of the most unpleasant aspects of a job. There’s no easy way to tell an employee they’re being let go, but there are ways to make it a little less uncomfortable

Even when just cause exists to let an employee go, employers still have to follow proper firing etiquette. Here’show to correctly terminate an employee, and protect your company.

Do it Before Friday!

Let your employee go as early in the week as possible. If you terminate an employee on a Friday, it gives them the weekend to stew about it, and they may return Monday morning with a bad attitude.Avoid waiting until week end, and definitely don’t wait until the end of the day. 

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

Earlier in the day is better because it shows good sportsmanship. It’s bad manners to letthat employee work all day, only to find out they’ve been fired by day-end. Get it done early for your sake and the employee’s. 

Consistent advice recommends firing the employee as early in the week as possibly to avoid mulling things over on the weekend. It allows the person to quickly transition in to the process of finding a new job, which is easier to manage at the beginning of the week.

Bring a Witness

Don’t terminate an employee on your own.This leaves employers vulnerableto a “he said/she said” conversation if the employee chooses to retaliate. Ifthe employee decides to bring an action against you, you have no witness to call who can verify the conversation. 

It’s good for an employer’s own protectionas well, in case the person has a nuclear reaction and the situation takes a turn for the worst. A witness can be present for safety, and account for your actions in case of an argument or if you’re later accused of wrongful behavior.

Be Prepared

Know what you’re going to say ahead of time. It will minimize the awkwardness and speed up the process. Keep it simple. Firing is already uncomfortable, so there’s no need to complicate it even more.

Stick to the point and don’t mince words. At this point, the employee is aware they’re being terminated, so saying less helps keep some dignity.It’ll also keep the conversation short and won’t allow time for the employee to retaliate.Explain clearly and briefly why they’re being let go. Be sure to explain severance and benefits if they’re entitled to anything at the time.

Bring A Record

If your employee had to meet specific goals, maintain a written record that you can presentat the meeting,highlighting where they failed to complete them. For example, maybe they had a sales target to meet but continually missed the mark.

Give the employee a list of specific behavior issues that were not improved and continued to be problematic. If the employee had opportunity to improve, provide that record as well to show there was no follow up. Identifying subpar performance and where they didn’t succeed justifies your reason for termination. It will also help avoid you from being dragged in to anything later.

Have an Exit Strategy

Don’t put your employee through a walk of shame after the termination. Choose a location and time with the lowest amount of people around. Pick a neutral part of the office instead of your own, in case they have an emotional reaction and need time to recover or gather themselves.

Conference rooms, neutral offices–a room with a closed door is necessary when you conduct this private meeting. If possible, pick a room close to an exit, so the employeeonly has a short walk after.This draws less attention and makes it easier on the employee when they have to leave.

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Topics: human resources

Why Employment Agreements Are Important in Canada

Posted by Anna Mastrandrea

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Mar 20, 2017 9:00:00 AM

Why-Employment-Agreements-Are-Important-in-Canada.jpgBoth employers and employees need to protect themselves, and an employment agreement is one of the most effective ways companies do this. The agreement provides workers and employers with a document clearly outlining the specific obligations of each party, making their individual duties evident and understandable. In Canada, employment agreements are incredibly important.

What Are They?

An employment agreement, sometimes referred to as an employee contract, is a contractual obligation between an employer and employee, covering a variety of work-related clauses. It identifies the duties and responsibilities of the worker, while protecting the employer from certain liabilities. 

To hold up in court, this agreement should be well-drafted and vetted by a legal team.Both parties can negotiate terms prior to signing, so both are equally happy and able to work with the agreed-upon terms. Each clause in the contract must comply with the province’s applicable employment standards act. The courts will void any clauses which fall below it. 

Signed by both the employer and employee, this binding contract allows for a high level of specificity, and provides stability and security for both parties involved. These agreements form the beginning of the employer-employee relationship while highlighting the degree of organization and structure within the company.

Clarify Termination

Canadian business owners don’t have the option to terminate employees “at will”. Inclusion of this clause in the agreement is vital for employers’ protection, should they find this option necessary.The termination clause is one of the biggest provisions to correctly draft because it protects the employer from potential cases of wrongful dismissal or termination. As well as letting the employer know when it’s acceptable to fire the employee, the employee can refer to it should they wish to leave the company. 

Related termination provisions within employment agreements include: a lay-off clause (outlining when it’s acceptable for the employer to do so); how much notice to give the employee prior to terminating, or the pay in lieu of; and specify what the employee is entitled to regarding any severance pay. Also related in this section of the contract are non-compete and non-solicitclauses, safeguarding the employer from losing important company information should the employee consider working with a competitor. 

Again, check the provincial employment standards act to ensure this clause is in line with the minimum standards.

Spell Out Terms

Employment agreements cover several big sections with detailed subsections.

The agreement outlines pay:calculating wages, vacation, statutory holiday, and overtime. There’s the previously mentioned termination clause, as well as a disciplinary provision. This clarifies that the employer conducted regular performance reviews, gave adequate warnings, and properly dealt with inappropriate behavior,prior to deciding termination. The health and safety clause is vital to ensuring both parties are responsible for a hazard-free work environment. It ensures the employer provides and maintains a safe working area that meets all the minimum health requirements, and that the employee is committed to following these rules to keep the area safe. Another important clause is the workplace violence and harassment policy, for employee protection and to ensure people’s rights aren’t violated.

Spelling out the details of each clause secures the rights of both employers and employees. As well as liability protection, a properly drafted agreement will include provisions that preserve both parties’ personal and intellectual property. This keeps the employer’s rights in check, ensuring there’s no abuse of power.

Detailed terms act as an easy reference point if either party is unsure about their responsibility, or feels they’re being cheated. If there’s an issue at work, the contract is there for easy reference andclarification of who’s in the wrong and how the issue can be fixed. The provisions’specific wording will outline the job performance requirements, so both the employer and employee know and understand what’s expected of them.

What US Companies Need to Know about Paying Employees in Canada

Topics: human resources

Wrongful Dismissal in Canada vs. USA

Posted by Ray Gonder

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Mar 17, 2017 9:00:00 AM

Wrongful-Dismissal-in-Canada-vs.-USA.jpgWrongful dismissal is a term every employer should comprehend. When not properly adhered to, it causesbusiness owners a major headache. Whether you’re an American employer managing Canadian employees, or vice versa, you need to be aware of how wrongful dismissal varies between both countries to ensure you dismiss your employees properly. 

Wrongful dismissal is when an employee is dismissed from their job without reasonable notice or proper compensation. It’s not to be confused with constructive dismissal, where an employee’s position is reconstructed to the point where they feel dismissed (often seen in pay cuts, demotions, and possibly workplace abuse). 

Here’s where wrongful dismissal varies between the two countries.

Human Rights

To ensure reasons for dismissal are not discriminatory, the onus on Canadian employers is much higher than its American counterparts. While both countries prohibit on grounds of gender, religion, race, and ethnic origin, they differ in two areas: disability, and drug and alcohol dependence. 

Canadian employers have a high duty to accommodate disabled employees–up until it causes the employer undue hardship. “Undue hardship” varies in terms of the company’s scope and the nature of the disability. In the U.S., the threshold to accommodatean employee with a disability before discharging them is very low. Canadian human rights legislation expects adapting physical space, reorganizing work tasks, and related activities before employers exonerate the employee. U.S. employers aren’t required to go as far. 

The Canadian workforce cannot wrongfully dismiss an employer with a drug or alcohol-related dependency. Testing for this is correspondingly restricted in Canada. American employmentrecognizes only addiction recovery as a disability, and pre-employment testing is more common.Consider these factors first to ensurethat you, asa business owner, haven’t wrongfully dismissed a Canadian employee.

“At Will” Termination

U.S. employers have the option to terminate employees “at will”–with no notice or pay, as long as it is non-discriminatory and complies with employment contracts. Canadian employers don’t have this option, and are required to give notice or pay in lieu of, as common law or contract requires.Canadian employers also need legal justification for dismissal–difficult to prove, which leads to manyof themprovidinglarge severance packages to employees instead. 

While each state has individual regulations as well, Canadian employment standards really vary by federal and provincialruling. Quebec, Nova Scotia, and all federal employees have a threshold number of years of service where they cannot be discharged without cause, notice, or pay. If they are, these employees may have a right to claim their position be reinstated. The U.S. doesn’t offer a deal of this kind when dismissing employees.

Just Cause

Just cause is another crucial term all employers must fully understand.Employers can skip paying statutory termination or severance pay under the relevant employment standards act. It exists where an employee violates an essential condition of the contract.

In Canada, employers may dismiss for just cause, generally under insolence or serious incompetence, but it’s much harder to prove in court. There’s no middle ground or near cause. If the employer can’t prove it, it’s deemed wrongful dismissal, and any damages acquired will have to be paid by the employer.

The U.S. by contrast has two employee categories to deal with dismissal: at will, and just cause. As previously described, “at will”allows an employer to fire an employee for any reason, or none at all, and can do this any time without notice.It’s limited by the employee contract and the union. Just cause is used where a staff member fails tocorrectly perform duties or for other non-arbitrary reasons. It’s used when the company has specifically outlined termination reasons in the handbook or employee contract. Here is where the employee can be fired under reasons of “just case”.

All employers should be aware of how wrongful dismissal differs in Canada and the U.S.A, to ensure they follow proper protocol when dismissing staff.

What US Companies Need to Know about Paying Employees in Canada

Topics: human resources

5 Ways You’ll Benefit When You Outsource HR

Posted by Corinne Camara

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Dec 30, 2016 9:00:00 AM

5-Ways-Youll-Benefit-When-You-Outsource-HR.jpgYour human resources department is responsible for a wide variety of functions. The department must manage compliance, employee files, and records. It must oversee payroll, tax filing, benefits and pension administration and retirement planning. It must handle employee relations issues, WSIB and insurance, health and safety, training and development, and much more.

The various functions that must be managed are comprehensive, complex, and time consuming. For many businesses, it’s a daily struggle to handle HR in house.

That’s why more and more companies are starting to outsource HR to a third party. Here are some of the benefits you’ll gain if you outsource HR.

1. Improve Compliance and Risk Management

Your business must comply with a wealth of labour regulations and employment standards, including WSIB, payroll and tax, insurance, and health and safety. What’s more, these regulations change regularly. It can be difficult to ensure full compliance at all times.

Many organizations outsource human resources as part of their risk management strategies. Having experienced, knowledgeable professionals ensure compliance is a great way to minimize risk. These experts stay abreast of employment laws and understand the employment standards you must abide by, inside and out. You can significantly reduce your risk of lawsuits, fines, and penalties by outsourcing human resources.

2. Reduce Overhead Costs

In order to ensure that all HR tasks are handled efficiently, accurately, and in a timely manner in house, you must maintain a robust human resources department. That means paying many salaries, committing office space, purchasing equipment, software, and supplies, investing in conferences and seminars, and more.

Considering HR is a non-revenue generating activity, this back-office expense may be seen as a waste. When you outsource HR, you will not have to commit to paying any of this. You’ll have highly trained and experienced professionals handling your HR functions, with the latest knowledge and technology, but the cost won’t reflect it. Outsourcing human resources is often the most cost-effective option, especially for small businesses. The costs are transparent and also variable, so you can be reduced them if required.

3. Greater Efficiency

If your HR team is using outdated technology, managing tasks manually, or being forced to multitask an overwhelming number of functions, your HR department will be inefficient. In addition, if your HR professionals were to take leave, take vacation, or quit suddenly, your department could crumble. None of this is a problem when you outsource. Your HR tasks will be handled by a team of experts that you can rely on, using the best technology on the market, and dedicating all of their time to complete tasks in a timely manner. This will greatly improve efficiency.

4. Greater Accuracy

The smallest payroll mistake can cause you a world of trouble. Missing one filing deadline can lead to fines, interest fees, and penalties. Filling out paperwork incorrectly can lead to a painful audit. Managing employee relations inappropriately can lead to lawsuits. Outsource HR to get the expertise you need to ensure greater accuracy in your back office, without having to hire additional personnel at high salaries.

5. Focus on Your Business

Because human resources is so complex and time consuming, you could end up spending too much time and too many resources on it. This will leave you with far less time to focus on your expansion efforts, on strategic business, and on revenue-generating activities. By outsourcing your human resources department to third party, you’ll be able to move your focus back on the work that truly matters.

Outsourcing HR is a smart business decision that will allow you to improve compliance and risk management, reduce costs, improve accuracy and efficiency, save time, and so much more.

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Topics: human resources

How to Avoid Employee Misclassification

Posted by Corinne Camara

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Nov 21, 2016 9:00:00 AM

How-to-Avoid-Employee-Misclassification.jpgEmployee misclassification is a particularly problematic technical error a company can make. Upon entering the Canadian market, it is important for businesses to create and maintain a good working relationship with the Canada Revenue Agency (CRA). The CRA will handle many payroll regulations and taxation, and as a result it’s imperative that businesses abide by all legalities in order to avoid costly fines and penalties. 

Employee misclassification happens when a business lists a full-time employee as an independent contractor, but it also applies to the reverse scenario. With misclassification, employees must pay for services like their pensions or employment insurance. Unfortunately, a misclassification error reduces the income of both the worker and the tax agency, and it can result in hefty fines, investigations, and even lawsuits. 

Luckily, employee misclassification doesn’t have to take away from your business. With the help of a Professional Employer Organization (PEO), you can move ahead with business as usual knowing that the experts are taking care of the intricacies of HR, benefits, and worker’s compensation.

Know the Difference

Knowing the difference between an employee and an independent contractor is one of the most important ways business owners can avoid misclassifying employees. It is incredibly important to differentiate between an employee and a self-employed individual, especially when it comes to a worker’s entitlement to employment insurance (EI). 

In a typical employer-employee relationship, the payer is considered an employer while the worker is an employee. The employer is responsible for deducting pension contributions, EI premiums, and income tax from the remuneration they pay to their employees. Independent contractors are typically responsible for divvying up their earnings on their own accord, which is how a misclassification can end up costing your workers a hefty sum. Even if employee misclassification happens out of an honest mistake, not being familiar with the difference between employees and contractorswon’t keep you from dealing with the consequences.

Early Reclassification

Employee misclassification is surely a frightening possibility for any business owner. Despite the risks, there are many benefits to using the contingent workforce. Business owners have more freedom over taxes and health coverage while workers can enjoy the entrepreneurial freedom of setting their own schedules. 

Hiring contingent workers, however, requires that employers lay out clear expectations from the very beginning. Occasionally, employers will hire contractors with the intention of eventually putting them on the payroll as company employees. If you plan on turning your contractors into company employees, it’s best to reclassify workers immediately to avoid a more burdensome, costly process later on.

Outsource

Employee misclassifications are unpleasant for all parties involved, and there’s no need for a business to have to confront a class-action lawsuit over a small administrative error. To avoid costly lawsuits and negotiations, your business can invest in consultation services that specialize in the contingent workforce. 

Using a PEO service in Canada can give your business the administrative and legislative relief you need to avoid employee misclassifications. As a cost-efficient way to eliminate full-time payroll staff, your business can avoid easy-to-make mistakes that could end up eating a lot of your business’s time. Outsourcing some of your HR duties helps you deal with the difficulties of regulatory agencies, and often, businesses find themselves benefiting from extra value associated with PEO services. 

Companies offer complete HR task management and depending on the firm you may also be offered unique benefits. Companies that work with PEOs can use the organization’s group buying power to leverage better benefits for staff. As a client of a firm devoted to staying competitive, you’ll be able to avoid legal trouble and make smart business decisions to help your company grow.

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

Topics: human resources

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