Canada Hiring Employees Guide

hiring employees in Canada. The employer must register for the payroll deductions (the RP account with the CRA), deduct the CPP, the EI, and the income tax from the employee's wages, and remit the deductions to the CRA. The workers' compensation — the employer must register with the provincial workers' compensation board (the WSIB in Ontario, the WorkSafeBC in BC, the WCB in Alberta) and pay the annual premium (the "employer premium" — the rate depends on the industry). The employment standards — the employer must comply with the provincial employment standards (the "Employment Standards Act" — the minimum wage, the hours of work, the overtime, the vacation pay, the statutory holidays, the termination pay, the severance pay). The employment contract — the written agreement (the "employment agreement") that defines the terms of the employment (the job duties, the compensation, the benefits, the termination clause, the non-compete clause). The employee benefits — the group health insurance (the "group benefits" — the life insurance, the dental insurance, the extended health insurance), the RRSP matching (the "group RRSP" — the employer contributions to the employee's RRSP), the stock options (the "employee stock option" — the taxable benefit). The employer compliance — the CRA may conduct the payroll audit (the "payroll audit" — the review of the source deductions, the T4 reporting, and the employee vs contractor classification).

Employer Registration

CRA payroll account (RP): The employer must register for the "Payroll Deductions" program account (the BN + the "RP" program code). The registration is made through the CRA My Business Account or the Form RC1.
Provincial workers' compensation: The employer must register with the WSIB (Ontario), the WorkSafeBC (BC), the WCB (Alberta), the CNESST (Quebec), or the WCB (the other provinces). The registration is made within 30 days of the hiring of the first employee.
Provincial health tax: The employer may need to register for the provincial health tax (the "Employer Health Tax" in Ontario — the "EHT" — the annual payroll tax of 0.98% on the payroll above $1 million; the "Health Services Fund" in Quebec — the "HSF" — the payroll tax at up to 4.26%).

Employment Standards

Minimum wage (2025): Ontario: $17.20 per hour, BC: $17.40 per hour, Alberta: $15.00 per hour, Quebec: $15.75 per hour, Federal: $17.30 per hour (the "federal minimum wage" for the federally regulated employees).
Overtime: The overtime pay at 1.5x the regular rate after 44 hours per week (the "standard" threshold in the most provinces). The overtime threshold varies by province (Ontario: 44 hours, BC: 40 hours, Alberta: 44 hours, Quebec: 40 hours).
Vacation pay: The minimum vacation pay is 2 weeks (4%) for the employees with less than 5 years of the service and 3 weeks (6%) for the employees with 5+ years of the service. The vacation pay is paid on each pay period or as the lump sum.
Statutory holidays: The employees are entitled to the paid statutory holidays (the "statutory holidays" — 9 days in Ontario, 10 days in BC, 9 days in Alberta). The employee who works on the statutory holiday must receive the premium pay (1.5x the regular rate).
Termination pay: The employer must provide the notice of termination (the "notice period" — 1 week to 8 weeks, depending on the length of the service) or the "termination pay in lieu of the notice". The termination pay is the "pay in lieu of the notice" (the "statutory termination pay"). The common law termination pay may be higher than the statutory minimum.

Workers' Compensation

WSIB (Ontario): The Workplace Safety and Insurance Board. The employer pays the "WSIB premium" (the rate depends on the industry — the "Schedule 1" and the "Schedule 2" classifications). The 2025 premium rates range from $0.13 to $20.29 per $100 of the payroll.
WorkSafeBC (BC): The employer pays the "WorkSafeBC premium" (the rate depends on the "classification unit" — the industry classification). The 2025 premium rates range from $0.25 to $30.00 per $100 of the payroll.
WCB (Alberta): The Workers' Compensation Board. The employer pays the "WCB premium" (the "industry rate" — the classification rate). The 2025 premium rates range from $0.20 to $25.00 per $100 of the payroll.

For the payroll source deductions and the T4 filing, see our Payroll Guide →. For the employee vs contractor classification, see our Employee vs Contractor Guide →.