Hire employees and contractors in Canada
Outstaffer’s guide to employing in Canada.
Facts & stats
Canada is the second-largest country in the world by land area, split into 10 provinces and three territories. With a GDP of nearly $2 trillion in 2020, Canada has a robust economy with workers in a variety of critical industries. Companies looking to hire remote workers in Canada will find plenty of talent in tech, finance, health, professional services, and a variety of other industries. Thanks to its abundant resources, Canada is also home to thriving businesses in agriculture, mining, forestry, and construction.
- Capital city
- Ottawa
- Currency
- Canadian dollar ($, CAD)
- Official Languages
- English, French
- Population size
- 37,589,262
- Ease of doing business
- Very Easy
- Cost of living index
- $$$
- Payroll frequency
- Bi-monthly
- VAT - standard rate
- 5% (varies by province)
- GDP - real growth rate
- 1.9%
Tech Talent in Canada
Canada is renowned for its thriving tech talent ecosystem. The country boasts a robust community of highly skilled software developers, engineers, and IT professionals. Canadian universities are globally recognized for producing top-tier tech graduates, and cities like Toronto, Vancouver, and Montreal have emerged as vibrant tech hubs, attracting both startups and established tech giants. Canada's welcoming immigration policies have further enriched its tech talent pool, drawing in professionals from around the world. Canadian tech talent is known for its diversity, innovation, and adaptability, contributing significantly to the country's position as a prominent player in the global tech industry.
Grow your team in Canada with Outstaffer
Looking to hire employees in Canada? Companies hiring in Canada must either own a local legal entity or work with a global employment platform like Outstaffer that can legally provide employment services in the country.
Outstaffer makes it easy for companies of all sizes to employ workers in Canada using our employer of record solution. We can help employ your Australian team using our local Canadian entity, as well as handle your payroll, benefits, taxes, and local legal compliance.
Minimum wage
Canada’s minimum wages vary by province. Most provinces adjust their minimum wages regularly to keep up with inflation. The Retail Council of Canada maintains an updated list of minimum wages in the country. The Government of Canada proposed a federal minimum wage of $15 per hour, rising with inflation, effective on December 29, 2021. However, each province still sets their own hourly minimum wage.
Payroll cycle
All employee payments are made bi-monthly by Outstaffer.com on your behalf and passed through to you.
Onboarding time
We can help you get a new employee started in Canada fast. The minimum onboarding time we need is only 14 working days.
Our team ensures your employees are onboarded and paid as quickly as possible while keeping your business compliant with all local employment legislation. The minimum onboarding time begins after the employee submits all required information onto the Outstaffer platform. The onboarding timeline is also dependent upon registration with local authorities.
For all non-nationals of the country of employment, the Right to Work assessment (if applicable) will add three extra days to the total time to onboard. There may be extra time required if we need to follow-up on the right to work assessment.
Please note, payroll cut-off dates can impact the actual first day of employment. Outstaffer has a payroll cut-off date of the 10th of the month unless otherwise specified.
Employing in Canada
Canadian labor laws vary from one province to another, although the country does enforce some laws at the federal level. Employees in Canada enjoy protections against discrimination based on age, religion, sexual orientation, gender expression, and race.
Although “Canadian work experience” is a common subject, employers should avoid asking employees about Canada-specific work history. Depending on the laws of the province, certain questions about Canadian work experience could be considered discriminatory. When interviewing candidates in Canada, limit questions to the duties and responsibilities of the role instead of focusing on where the candidate gained the experience.
Common questions including minimum wage, overtime rates, and guaranteed paid time off vary depending on the province. We can help you offer a complete, competitive, and compliant benefits package to your employees in Canada.
Risks of misclassification
Public holidays
Jan 2
New Year's Day
Jul 1
Canada Day
Dec 25
Christmas Day
Apr 7
Good Friday
Sep 4
Labor Day
Competitive benefits package in Canada
Beyond providing your employees with all statutory benefits in Canada, Outstaffer can help you create a custom benefits package for your international team. A competitive benefits package may include perks such as:
Private health insurance
Supplemental dental insurance
Supplementary vision insurance
Supplemental maternity insurance
Supplemental screening & vaccine insurance
Additional paid holidays
Flexible work schedule
Employee engagement funds
Taxes in Canada
Learn how employment taxes and statutory fees affect your payroll and your employees’ paychecks in Canada.
Employer (outside Quebec)
- 5.7% - Canada Pension Plan, up to $3,499.80 per year
- 2.21% - Employment Insurance, up to $1,333.84 per year (can vary by province)
Employee (outside Quebec)
- 5.7% - Canada Pension Plan, up to $3,499.80 per year
- 1.58% - Employment Insurance, up to $952.74 fper year
Employee Federal Income Tax
- 15% - $0 to $50,197
- 20.5% - $50,195 to $100,392
- 26% - $100,392 up to $155,625
- 29% - $155,625 up to $221,708
Employee Provincial Income Tax
Canada’s individual provinces and territories charge their own income taxes to residents and workers. These rates change periodically and vary widely from one province to another. Remote Canada legal entity is based in the province of British Columbia and income tax withholding is based on this province's rates. For employees residing outside of this province, province-specific adjustments to the tax withholding amount will be needed. For updated information regarding tax rates in specific provinces, view Canada’s official tax website.
Types of leave
Paid time off
Paid time off laws in Canada vary by province. Employment standard legislation guarantees two weeks of PTO to employees after one year of work. After five years, the minimum increases to three weeks, then four weeks at 10 years. Employers may offer unlimited time off in Canada.
Family violence leave
Canada is one of a few nations to offer family violence leave for victims. Employers must offer at least 10 days of protected leave to employees to use in case of family violence, five of which must be paid. Employees accused of committing acts of family violence are not eligible.
Medical leave
Employees in Canada are guaranteed a minimum of 17 weeks of unpaid protected medical leave. Employers are permitted to request medical documentation verifying the need for any leave lasting longer than three days.
Partner/paternity leave
Salaried employees in Australia are entitled to four weeks of paid annual leave each year. Shift workers receive an additional week of paid leave, for a total of five weeks per year.
COVID-19 leave
Canada offers protected paid leave to employees who must quarantine because of COVID-19 and employees who must take time off to recover from the virus or care for a relative who tests positive. Quarantine leave can last up to two weeks, while sickness or care leave can last up to 26 weeks. Canada’s COVID-19 leave guarantees are set to expire on September 21, 2021.
Critical illness leave
Canadian employees are entitled to protected leave to care for sick family members. Protected critical illness leave covers 37 weeks per sick child and 17 weeks for sick adults.
Paid holiday leave
Canada observes several public holidays (see above). Employees are entitled to holiday pay no matter how long they have worked for the company.
Leave for legal proceedings
Employees in Canada are entitled to protected unpaid leave to serve on juries or act as witnesses, but this leave does not extend to employees who are parties in lawsuits, either as plaintiffs or defendants.
Child disappearance leave
Parents of children who go missing are entitled to 52 weeks of unpaid protected leave. If the child is discovered to be deceased, leave entitlement increases to 104 weeks beginning on the date of the death. Adoptive parents, guardians, and primary caregivers are all eligible to receive child disappearance leave, provided they are not charged with a crime related to the disappearance. This leave also does not extend in cases where children are suspected to be party to a crime related to their own disappearance.
Maternity leave
Canada guarantees at least 15 weeks’ maternity leave, though some provinces set a higher minimum. Employers do not have to pay for maternity leave, as Canadian social programs provide payments to new parents.
Paternity and parental leave
Parents in Canada are also entitled to at least 27 weeks’ shared parental leave, regardless of gender. In some provinces, the shared parental leave minimum is 35 weeks.
Aboriginal employee leave
Employees in Canada with Aboriginal heritage are entitled to receive five days of unpaid leave per year to observe Aboriginal customs and events, which can include fishing, hunting, and traditional ceremonies.
Employment termination
Termination process
Canadian laws encourage employers to work with employees who are underperforming instead of defaulting to termination. In cases where termination is unavoidable, though, employees in Canada retain a few protections. Canada does not practice at-will employment. Quebec has special protections in place regarding employee terminations for employees with more than two years of service.
Notice period
Employees are usually entitled to notice (or pay in lieu of notice) when being terminated. Notice periods vary based on age, experience, tenure, and availability of other work options.
Probation periods
Probationary periods are common in Canada and typically last around three months. Some provinces enforce mandatory probationary periods to provide employers with some protection, even when the probationary period is not specified in the employment agreement.
Get started with Outstaffer in three easy steps
01. Book a call or sign up
Book a call with one of our Solutions Managers or create your free account. It’s quick, easy, and you’ll be ready to get started in minutes.
02. Add your people
From new hires to your existing team, onboard them seamlessly with our simple-to-use self-serve platform
03. Dedicated onboarding
Our dedicated team is here to guide you every step of the way ensuring you’re confident, supported, and set up for success.