Employers of Record (EORs) in Canada: Everything you need to know
Increasingly, companies worldwide are looking to recruit internationally to take advantage of the varied skills and abilities of foreign workers. The Canadian talent pool is one of the most sought-after, and not just due to the country’s proximity to the US.
While having timezones that are closely aligned to the U.S. is certainly one benefit of hiring in Canada, it’s by no means the only one.
Canada’s workforce of over 18 million people is diverse and highly skilled. The country even boasts the most educated workforce in the world, with the majority of Canadians aged 25–64 holding post-secondary degrees. Canada offers world-class talent in several top industries, like engineering and technology. The fact that English is the primary language there only makes hiring employees in Canada even more appealing.
Even with a neighboring country, however, hiring across borders can be complicated. To avoid some of the issues associated with hiring employees in Canada—such as needing to set up an office or subsidiary there—many companies choose to use an employer of record (EOR) in Canada.
EORs in Canada
An EOR in Canada is a third-party organization that acts as the legal employer of Canadian workers your company wants to add to its workforce. Using an EOR is an attractive alternative to setting up a foreign entity to hire employees directly.
The process of setting up a new entity in a foreign country is complicated, time-consuming, and costly. If your organization doesn’t plan to maintain a long-term presence in Canada or hire a large team, an EOR may be the better way to go.
Your EOR in Canada will handle the personnel functions of your workforce within the country, including hiring, payment, and management. It’s a simple way to streamline the foreign employee onboarding process and stay in compliance with local labor laws.
A few things to know about hiring in Canada
Using written employment contracts is not mandatory for employers operating in Canada, but it is highly recommended. In most provinces, employment contracts must be written in English. Any employment contracts or other documents in Québec, however, need to be in French.
Canada is one of the countries that’s known for offering universal healthcare coverage. The universal healthcare system in Canada is one the best in the world, yet many people also have some form of private medical coverage. Some employers provide supplemental health insurance to their full-time employees as part of their benefits packages.
Just like in the United States, Canadian employees generally work eight hours per day, five days per week for a total of 40 hours per week. The maximum hours spent working per week is generally 48 hours. Workers can exceed this number in certain cases, like emergency work or a modified work schedule.
After 44 work hours in a week in Ontario and 40 hours weekly in Québec, employees are entitled to hourly overtime pay equal to at least 150 percent of regular pay.
Employees in Canada are entitled to at least two weeks of paid vacation each year after one year of continuous employment with a single employer. After five years working for the same employer, that increases to 3 weeks of vacation each year and goes up further to 4 weeks per year after 10 consecutive years with one employer.
There are also 10 paid holidays in Canada including Civic Holiday, Canada Day, and Victoria Day. Holidays vary by province and region in Canada.
In Canada, employers can terminate employment for a wide range of reasons. After the probation period in an employee’s contract, however, the employer must provide either notice of termination or payment covering the notice period. The amount of notice required depends on the province and how long the employee has worked for the employer.
Find out more about hiring in Canada in our complete hiring guide.
Hiring in Canada made simple
Rather than dealing with all these details of Canadian employment law, why not let an employer of record in Canada handle it for you?
Using an EOR in Canada allows you to tap into the Canadian talent pool without the usual headaches of global employment. Oyster makes hiring across borders simple by handling all aspects of employment for you, including:
- Compliance with local laws
- Time off management
Talk to one of our advisors today to find out how our global employment platform can streamline onboarding for team members in Canada.
How much does it cost to hire in Canada?
The costs of hiring in Canada vary depending on the territory the employee is based in. Check out our territory-specific tools to get an idea of the associated tax costs in:
- British Columbia
- New Brunswick
- Newfoundland and Labrador
- Novia Scotia
- Prince Edward Island
Oyster is a global employment platform designed to enable visionary HR leaders to find, engage, pay, manage, develop, and take care of a thriving distributed workforce. Oyster lets growing companies give valued international team members the experience they deserve, without the usual difficulties and expense.
Oyster enables hiring anywhere in the world—with reliable, compliant payroll, and great local benefits and perks.