Key Facts
| Employment Terms | |
| Timezone | There are six main timezones in Canada: Newfoundland Time Zone: (GMT-3:30), Atlantic Time Zone: (GMT-4), Eastern Time Zone: (GMT-5), Central Time Zone: (GMT-6), Mountain Time Zone: (GMT-7), Pacific Time Zone: (GMT-8) |
| Currency | Canadian Dollar (CAD) |
| Capital city | Ottawa |
| Official language | English, French (some provinces) |
| Ease of doing business | Very friendly to business (#23 out of 190) |
| Minimum wage | CAD $13.50-$16.00 (varies per province) |
| Estimated employer cost | 7 – 11% (varies per province) |
| Employer retirement contribution: Canada Pension Plan (CPP) | The retirement scheme in Canada includes several components, such as: the Canada Pension Plan (CPP), OId Age Security (OAS) and private retirement savings plans.The Canada Pension Plan (CPP) is a mandatory, contributory public pension plan that:
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About Canada
Canada is a developed nation with a population of around 38 million people, and its gross domestic product (GDP) ranks as the world’s tenth largest. The Organisation for Economic Co-operation and Development (OECD) has rated Canadian education as among the world’s highest, with a significant number of individuals attaining a university education. Additionally, Canada has implemented a thorough set of employment regulations that encompass various aspects such as terms of employment, working conditions, and industry-specific minimum wage requirements.
Employment in Canada
Working Hours
- The standard full-time working week is 40 hours, however 40 hours is typical for salaried professionals. Variations are common, but must be agreed in writing.
Overtime
- Overtime pay is typically set at 1.5 times the regular rate of pay for each hour worked over the standard hours. However, there may be variations in overtime rules depending on the industry, job position, and collective bargaining agreements.
Probationary Period
- The duration of probationary periods can vary depending on the employer, industry, and job position, but they typically range from one to six months.
Payroll Cycle
- The most common payroll cycle is bi-weekly, although some employers may choose to pay employees weekly or semi-monthly. Employers must comply with employment standards legislation related to payroll and pay periods.
Main Types of Leave in Canada
Annual Vacation
Federally regulated employees in Canada are entitled to a minimum of 2 weeks of paid vacation per year after completing 1 year of continuous employment with the same employer. This entitlement increases to 3 weeks after 5 consecutive years of employment and 4 weeks after 10 consecutive years of employment with the same employer.
Paid Medical Leave
Up to 10 days* of paid medical leave per year for illness or injury, organ or tissue donation, attending medical appointments, or quarantine. This entitlement applies when the employer schedules or expects the employee to work. The employer must pay the employee for each day of medical leave taken at their regular rate of wages for normal hours of work, and the leave may be taken in one or more periods. However, each period of leave must be at least one day in duration.
*As of December 2022, federally regulated private sector employees can now get up to 10 days.
Parental Leave (Employment Insurance maternity and parental benefits)
Under the Employment Insurance (EI) program, parental benefits can be paid for up to 35 weeks at 55% of the employees’ average weekly insurable earnings. This can be extended up to 61 weeks at a rate of 33% of the average weekly insurable earnings with a maximum amount.
Other Leave (Unpaid)
Bereavement Leave: Employees can take a certain amount of unpaid leave due to the death of a family member or relative.
Compassionate Care Leave: Employees can take unpaid leave to care for a family member or relative who has a serious medical condition with a significant risk of death.
Personal Leave: Employees can take a certain amount of unpaid leave for personal reasons, such as to attend to family obligations or to pursue educational opportunities.
Jury Duty Leave: Employees who are required to serve on a jury are entitled to unpaid leave.
Reservist Leave: Employees who are members of the Canadian Forces Reserves are entitled to unpaid leave for military training or deployment.
Domestic Violence Leave: Employees who are victims of domestic violence or who need to care for a family member who is a victim of domestic violence can take unpaid leave to seek medical attention, obtain services from a victim services organisation, or relocate to a safe place.
Employment Termination
Notice Period
The minimum notice period under the Canada Labour Code is two weeks, but it can be longer depending on the circumstances.
Termination
A valid reason is required to dismiss an employee; there are four main categories which include: incapacity to meet the inherent requirements of the role; unacceptable performance, misconduct and redundancy.
- Incapacity to meet the inherent requirements of the role
- Unacceptable performance
- Misconduct
- Redundancy
The employer may need to provide advance notice of termination or pay in lieu of notice, depending on the employee’s length of service and the reason for termination. Additionally, the employer must follow any relevant termination provisions outlined in the employee’s employment contract or collective bargaining agreement.
Severance
Employees who have worked for at least 12 consecutive months are entitled to severance pay, which is 2 days’ wages for each full year of service, with a minimum of 5 days’ wages.
Disclaimer: The information on this webpage is current as at 19 September 2022, and has been prepared by Employment Hero Pty Ltd (ABN 11 160 047 709) and its related bodies corporate (Employment Hero). The views expressed on this webpage are general information only, are provided in good faith to assist employers and their employees, and should not be relied on as professional advice. The information is based on data supplied by third parties. While such data is believed to be accurate, it has not been independently verified and no warranties are given that it is complete, accurate, up to date or fit for the purpose for which it is required. Employment Hero does not accept responsibility for any inaccuracy in such data and is not liable for any loss or damages arising either directly or indirectly as a result of reliance on, use of or inability to use any information provided on this webpage. You should undertake your own research and to seek professional advice before making any decisions or relying on the information displayed here.
Hiring Process in Canada
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Hiring an employee in Canada is no easy task. Especially, if you are overseas, and lack the knowledge of employment law and regulations relating to international HR compliance, payroll, benefits and taxes.
Employment Hero started in Australia and we fully understand all the ins and outs of hiring in the local market, so we can help you throughout the step-by-step process.
Canadian Employment Law
Decoded.
Canada has laws that help keep workplaces fair. You should be aware of the rules and what your employer's rights and responsibilities are. Under Canadian employment law, employers and employees both have rights and responsibilities. Do you know your responsibilities?
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