Global EOR Services in Canada
Find, Hire & Pay Employees in Canada
Expanding into Canada gives businesses access to one of the world’s most stable economies, a highly skilled and diverse workforce, and proximity to major North American markets. However, employment regulations differ across provinces, payroll compliance is complex, and setting up a local entity can be time-consuming.
A Global Employer of Record (EOR) helps you hire employees in Canada legally—handling local employment contracts, payroll, tax deductions, and compliance with both federal and provincial labor laws—without establishing a legal entity.
🇨🇦 Employer of Record (EOR) Services in Canada
Effortless Market Entry: Hire local talent swiftly without the need for entity establishment.
Regulatory Compliance: Ensure adherence to labor, tax, and social security laws.
Cost Optimization: Reduce overhead expenses by avoiding entity setup and administrative burdens.
Operational Focus: Delegate HR and compliance tasks while concentrating on core business activities.
🇨🇦Canada: A Comprehensive Guide to Employment and Labor Practices
Official Name: Canada
Capital: Ottawa
Major Cities: Toronto, Vancouver, Montreal, Calgary
Population: ~40 million (2025 est.)
Official Languages: English and French
Currency: Canadian Dollar (CAD)
Time Zones: Ranges from UTC-3.5 to UTC-8
Government: Federal parliamentary democracy and constitutional monarchy
Economy: Highly developed; key sectors include technology, natural resources, manufacturing, and services.
Corporate Tax Rate: ~15% federal + provincial (combined ~26–31%)
Personal Income Tax: Progressive, from 15% to 33% (federal) + provincial tax
Social Security: Employers contribute to the Canada Pension Plan (CPP), Employment Insurance (EI), and provincial health plans.
Minimum Wage: Varies by province (average CAD 15–17/hour).
Employment Laws and Policies in Canada
Employment Contracts
Employment can be written or verbal, but written contracts are recommended to define job terms, compensation, working hours, notice period, and termination clauses.
Most employment is “at will”, but termination must still comply with notice and severance requirements under applicable provincial law.
Types of contracts:
Permanent (indefinite)
Fixed-term
Part-time or casual
Independent contractor (must be classified correctly to avoid penalties)
Working Hours
Standard workweek: 8 hours per day or 40 hours per week.
Overtime: Paid at 1.5x regular rate after 8 hours per day or 40 hours per week (varies by province).
Rest Periods: Minimum 24 consecutive hours of rest per week.
Some industries (e.g., trucking, healthcare) have special rules under federal or provincial regulations.
Leave Entitlements
Annual Leave (Vacation):
Minimum 2 weeks after 1 year of service.
3 weeks after 5 years.
4 weeks after 10 years (in most provinces).
Public Holidays: 6–10 paid statutory holidays per year (varies by province).
Sick Leave: 3–10 paid days annually, depending on jurisdiction.
Maternity Leave: Up to 17 weeks unpaid (federal EI provides up to 55% income replacement).
Parental Leave: Up to 63 weeks shared between parents.
Other Leave Types: Bereavement, compassionate care, and family responsibility leave available under provincial laws.
Payroll, Tax & Contributions
Employers in Canada must handle federal and provincial payroll deductions, remittances, and contributions.
Federal Income Tax: Withheld based on progressive tax rates.
Canada Pension Plan (CPP):
Employer: 5.95% (2025)
Employee: 5.95%
Annual maximum contribution: CAD 4,055 (approx.).
Employment Insurance (EI):
Employer: 1.58% of insurable earnings
Employee: 1.20%
Provincial Health Contributions: Apply in provinces like Quebec, Ontario, and Manitoba.
Payroll Frequency: Usually biweekly or monthly.
Employers must remit withholdings to the Canada Revenue Agency (CRA) or Revenu Québec for Quebec employees.
Health & Safety
Governed by the Canada Labour Code (federal) and provincial Occupational Health and Safety Acts (OHSA).
Employers must ensure a safe workplace, provide hazard training, and report accidents.
Workers have the right to refuse unsafe work.
Termination & Severance
Notice Period:
1–8 weeks depending on length of service (minimum under provincial law).
Severance Pay:
In Ontario: One week’s pay per year of service (up to 26 weeks).
In Quebec and other provinces, terms vary.
Termination without cause requires reasonable notice or pay in lieu; termination for cause must be well-documented.
Non-Discrimination & Equality
Regulated under the Canadian Human Rights Act and provincial human rights codes.
Prohibits discrimination based on race, gender, religion, disability, sexual orientation, age, or marital status.
Employers must also comply with Pay Equity and Employment Equity legislation to promote equality and inclusion.
Opening a Legal Entity in Canada
Corporation (Federal or Provincial)
Must obtain a Business Number (BN) from the Canada Revenue Agency (CRA) for tax purposes.
Most common business structure.
Requires at least one director (must be a resident in some provinces).
Must register with Corporations Canada (for federal) or a provincial registry.
Extra-Provincial Corporation
- A foreign entity registered in one province but operating in others.
Branch Office
Requires registration in the province of operation.
The foreign parent remains liable for all operations.
- Suitable for large corporations.
- Minimum capital: 10,000,000 XAF (~USD 16,000).
- Requires at least 3 shareholders and a board of directors.
Subsidiary
- Operates as a separate legal entity incorporated in Canada.
- Provides limited liability and easier access to Canadian tax treaties.
Registration Requirements:
- Articles of Incorporation
- Canadian registered office address
- At least one local representative (in most provinces)
- CRA registration for payroll and GST/HST (if applicable)
Timeline:
CRA and payroll registration: additional 1–2 weeks
Federal or provincial incorporation: 2–3 weeks
Global EOR Services as Alternative:
Setting up a local entity in Canada involves multiple federal and provincial registrations, tax obligations, and compliance requirements. A Global Employer of Record (EOR) allows you to:
- Hire Canadian talent in days instead of months.
- Manage payroll, tax deductions, and benefits in full compliance.
- Avoid legal exposure from misclassification or wrongful termination.
Through an EOR, companies can expand into Canada efficiently, maintain full operational control, and ensure compliance with all provincial labor standards.
A Global EOR partner allows you to test the market, hire top local talent, and scale efficiently—without the administrative burden of setting up a local company.
Join us! It will only take a minute
Popular Global EOR Providers Supporting Canada
(They often partner with in-country firms for local compliance.)
Explore how Global EOR Services can transform your global workforce management.
Contact us today to learn more about our tailored solutions and how we can support your business goals.
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