Canada PEO Services

Employment Information

Canada has a standard of a 40-hour working week and overtime rates are usually applicable for more than 8 hours worked in a day (or 40 hours worked in a week).

Employee Leave

There is a minimum standard of two weeks paid vacation per year, however employees will sometimes provide more vacation for newer employees. In most cases, the allocation of annual leave is increased throughout a period of employment, especially after five years.

Sick pay varies dependent on the province, however 3 days per year is common. Maternity/parental leave of 55% of previous earnings up to 55 weeks and with an extra 29 weeks of extended leave available up to 84 weeks. If one parent takes this leave, then the benefit period is reduced slightly (to 50 weeks and 76 weeks respectively).

Taxation

In Canada, the average single worker faced a net average tax rate of 23.2% in 2020, compared with the OECD average of 24.8%. In other words, in Canada the base-home pay of an average single worker, after tax and benefits, was 76.8% of their gross wage, compared with the OECD average of 75.2%. 

Taking into account child-related benefits and tax provisions, the net average tax rate for an average married worker with two children in Canada was 0.7% in 2020, which is the 35th lowest in the OECD, and compares with 12.9% for the OECD average. This means that an average married worker with two children in Canada had a take-home pay, after tax and family benefits, of 99.3% of their gross wage, compared do 87.1% for the OECD average.

Visas

Would-be applicants are advised to consult with immigration experts before choosing to relocate to Canada. There are a number of visa programs available for expats, including:

• Temporary Work Visa (up to 12 months)
  1. In order to stay in the country, one of the other options is required
  2. Student visas, marriage and family sponsorship programs are some alternate options
• LMIA Visa (standard method, but difficult)
  1. Canadian businesses can apply for a work visa for a prospective employee, however a Labour Market Impact Assessment (LMIA) is required
  2. This assessment involves advertising for 2 months to prove that they cannot find another worker at a reasonable pay rate; this can be used to help the work permit application.
• TN Visa (new North American free trade provisions)
  1. This is often preferable to the LMIA Visa, as it’s an easier process
  2. Under new NAFTA, a TN Visa can be applied for in 65 occupations
• Inter-company Transfer Visa (ICT)
  1. You must apply for permission to transfer employees between USA and Canadian divisions (this is fairly easy to action)
• Canadian Experience Class Visa (CEC)
  1. It’s generally recommended that a worker achieves a Temporary Work Visa first
  2. A worker must work over 30 hours per week for a 12 month period
  3. Language fluency and education attainment (post-secondary degree) must be demonstrated
  4. Expats can often stay, but it is a points-based system
• Commonwealth Exemption
  1. People from other Commonwealth countries (including the UK, Australia, and New Zealand), can often be exempt from Visa requirements
• Some people choose to apply for Permanent Residency, followed by a Canadian Citizenship

Cultural Information

Canada’s Government is a parliamentary democracy with a highly developed economic system. As a part of the Commonwealth, it is also a constitutional monarchy, with Queen Elizabeth acting as the head of state.

Canada has two official languages in English and French, and has a highly multicultural society made up of three founding peoples (Indigenous, followed later by French and British). Canada also has numerous other ethnic groups.

Expanding into the Canadian market

Setting up or expanding a business in Canada is a relatively simple process, with minimal costs and red tape, and competitive corporation tax rates (especially for smaller businesses).

The process of expanding into Canada can be simplified further with the use of a Canada PEO like Procorre Global. Our PEO service can also be used to sample the Canadian market without the need of setting up a permanent establishment in country.

Impacts of COVID-19

Covid restrictions and policies are established at the provincial level and can vary significantly depending depending on new Covid case counts and hospitalizations. However, workers are generally returning to the workplace slowly.

Over 84% of the eligible Canadian population (12 and older) is now fully vaccinated (source: Covid 19 Tracker Canada).

According to Statistics Canada in new calculations based on survey data, up to one quarter of hours worked could be remote after the health crisis ends. That’s up from about 5 per cent pre-pandemic, the agency said. The figure for university-educated workers is 44 per cent, versus 9 per cent for those with no post-secondary education.

To come up with its estimates, the study used survey data from February that showed 80 per cent of Canadians who began working remote during the pandemic would like to work at least half their hours from home in a post-COVID world. In addition to education, there are also divides when it comes to gender. Women could see as much as 28 per cent of hours worked from home, compared with 22 per cent for men.