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SALARY PAYMENT IN Canadian Dollar (CAD, $)
CONTRACT LANGUAGES French / English
PAYROLL TAX 7.91%
PAYROLL CYCLE Monthly
TIME TO HIRE 12 hours
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Canada
Canada has a thriving economy, with strong real growth forecasts for 2022 (3.8 percent) and 2023 (2.6 percent). With a well-educated and highly skilled professional workforce, and business-friendly laws and regulations, Canada is an ideal location for hiring international employees.
Closely connected to both European and other North American markets, many businesses find that Canada is the ideal launchpad for their North American expansion.
| Population 38.232M (Labor Force 21 million) | Capital City Ottawa | Languages Spoken English and French |
| Currency Canadian Dollars (CAD$) | GDP per capita $52,022 | Ease of Doing Business 23rd in the world |
| Minimum Wage CAD$15.55/hour | Average Wage CAD1,050/Month | Paid Leave 3-4 weeks |
Despite some instances of social unrest related to containment measures, the Canadian economy has largely recovered from the Covid19 crisis. In 2021 Canada maintained its position as one of the top 10 economies in the world, ranking 9th largest by GDP.
The OECD indicates Canada’s real GDP will grow by 3.8% in 2022, and 2.6% through 2023. As a major exporter of natural resources, including; natural gas, crude oil, coal, minerals, and timber the war in Ukraine may see the above growth estimates revised. It should be noted, however, that increasing housing costs, capacity pressures and issues with global supply continue to drive inflation and the cost of living in Canada.
Open-ended employment contracts are the most common type of contract in Canada. They offer ongoing employment with no fixed end date, and if the employer wishes to end the contract they will need to terminate the employment. Fixed-term contracts are also available, and will end on a specified date in the contract.
The best type of employment contract depends on the job role and specific circumstances. For the vast majority of roles, an open-ended contract is the most suitable. however, there are some circumstances where an alternative like a temporary contract may be more suitable.
Like other advanced economies, Canada has strong labor laws protecting both the employee and the employer. Canada’s labor laws are complicated by differences in legislation at the federal and provincial levels.
Regardless of provincial variations, employers must meet certain Minimum Employment Rights when hiring in Canada. As an employer, it’s crucial that you have a firm grasp of your obligations before making any hiring decisions.
Sharing a 9,000km border with the U.S. has led to the development of close cultural ties with the world’s largest economy. Canada’s corporate culture also shares similarities with British and, to a lesser extent, French customs. Doing business in Canada is straightforward, especially for those organizations already familiar with American and Northern European business customs.
A handshake is the go-to business greeting and diversity and inclusion are becoming increasingly important concerns for decision makers. Equalities legislation (potentially both Provincial and Federal) will have implications for the selection of candidates and the interview process – see below.
Recruitment is primarily completed online in Canada. Jobs portals such as Robert Half, Indeed and Workopolis as well as social media platforms such as LinkedIn are popular.
Differences in provincial labor laws complicate the process. For an in-depth breakdown see the Complete Guide to Labor & Employment Laws in Canada.
To simplify the process and mitigate risk, many companies looking to hire employees in Canada opt to contract a global PEO or EoR. Combining in-country knowledge and extensive experience of international recruitment, global PEOs ensure full compliance with local tax and employment laws. As the industry leader, Horizons offer a range of strategic global recruitment services to help businesses meet their objectives whilst reducing hiring costs.
Although later stage interviews tend to be conducted in-person, the Covid19 pandemic has led to a marked increase in job interviews being completed entirely online.
The format of the interview will vary, usually depending on the level or complexity of the role. Regardless of language, interviews generally follow a similar pattern across all of Canada. As in the US and Europe, punctuality and presentation, both in terms of attire and non-verbal communication are important aspects in a Canadian job interview. The need for care in the recruitment process, in terms of local legislation and cultural norms, is another reason to consider the services of a PEO.
At the time of writing, it is legal in Canada to ask candidates about their current salary and salary history.
It is likely, however, that provincial governments across Canada and the Canadian federal government will introduce legislation that prohibits employers from asking candidates about their salary history. Such legislation has already been enacted in cities and states in Canada’s neighbor to the south.
In 2022, companies are offering salary increases between 3 to 5%. Job platform Indeed reports that, in 2022 a raise of 10% for employees starting a new role is not uncommon.
Once the most suitably qualified candidates have been identified & selected, it’s crucial that the hiring company ensures their onboarding process is fully compliant.
The specific onboarding process will vary from organization to organization but the following actions are recommended when onboarding new hires in Canada; verify and commit any employee personal information to secure systems for safeguarding; provide new hires with materials they need to perform the job; deliver a company orientation and any required training to get new hires up-to-speed.
Remote working is common in Canada and increasingly, hybrid working models are becoming an employee benefit. Furthermore, a 2021 survey of Canadian employers found that 76% of companies are open to hiring fully remote employees. Canadian employers are using the following remote working tools to manage remote teams:
National and provincial holidays in Canada in 2023 include:
| Date | Holiday name |
|---|---|
| 1 Jan., 2023 | New Year’s Day |
| 20 Feb., 2023 | Islander Day (PEI) |
| 20 Feb., 2023 | Louis Riel Day (MB) |
| 20 Feb., 2023 | Heritage Day (NS) |
| 20 Feb., 2023 | Family Day (BC, AB, SK, ON, NB) |
| 7 Apr., 2023 | Good Friday (National except for QC) |
| 10 Apr., 2023 | Easter Monday (QC) |
| 22 May, 2023 | Victoria Day (National except for NB, NS, NL) |
| 21 Jun., 2023 | Aboriginal Day (NWT |
| 24 Jun., 2023 | St. Jean Baptiste Day (QC) |
| 1 Jul., 2023 | Canada Day |
| 7 Aug., 2023 | Civic Holiday (AB, BC, SK, ON, NB, NU) |
| 4 Sept., 2023 | Labor Day |
| 9 Oct., 2023 | Thanksgiving (National except for NB, NS, NL) |
| 11 Nov., 2023 | Remembrance Day (National except for MB, ON, QC, NS) |
| 25 Dec., 2023 | Christmas Day |
| 26 Dec., 2023 | Boxing Day (ON) |
Canadian employees typically expect salary increases that match or exceed the rate of inflation.
Where the employee is located in Canada is also a factor with employees located in the Ottawa-Montreal-Toronto triangle, an area of concentrated wealth where living costs are higher than other parts of the country, likely to expect comparatively higher salary increases.
Your business can easily hire employees in Canada without opening a local entity. We handle local employment law, complex tax regulations, and international payroll in 180+ countries worldwide. All you need to do is focus on your business.
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