Quick facts

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Canada boasts a diverse and stable economy, driven by industries such as natural resources, technology, and services. With high living standards and strong worker protections, employment laws vary between provinces and territories, making it essential to understand regional specifics.

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Employment Contracts

Employment contracts are commonly used to establish the terms of the employer-employee relationship. These contracts outline entitlements, obligations, and restrictions, providing clarity for both parties.

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Probation Period

The maximum probation period is determined by the province, typically ranging from 3 to 6 months.

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Working Hours

Working hour regulations differ by province. Most provinces cap weekly hours, with Ontario allowing a maximum of 48 hours per week unless prior approval is obtained.

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• Overtime Pay: Usually 1.5 times the regular pay rate.
• Overtime entitlement starts at 44 hours per week in Ontario and 40 hours per week in Québec.

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Vacation Days

Employees are entitled to a minimum of:

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• 2 weeks of paid vacation per year of service.
• After 6 consecutive years with the same employer, employees gain 3 weeks of paid vacation annually.

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Sick Leave

Sick leave is generally unpaid in Canada, but employees may qualify for federal benefits like the Canada Pension Plan or Employment Insurance for long-term illnesses. For serious illnesses or injuries, employees are entitled to 12 weeks of job-protected leave.

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Wages and Salary Payment

• Employees in federally regulated industries are typically paid every two weeks in arrears, ensuring accurate payroll adjustments.
• Minimum Wage: Federal: $17.30 per hour, applicable to federally regulated sectors like banks and postal services. Provincial rates vary, with each province or territory setting its own minimum wage.

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Public Holidays

Canada observes 13 public holidays, although specifics vary by province. Federal holidays include:

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• New Year's Day (January 1)
• Good Friday (movable)
• Easter Monday (Federal workplaces only)
• Victoria Day (May 23)
• Canada Day (July 1)
• Labour Day (September 5)
• Thanksgiving Day (October 10)
• Christmas Day (December 25)

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Additional holidays like Saint-Jean-Baptiste Day and Boxing Day may apply regionally or in federally regulated sectors.

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Employer Taxes

Employers contribute to the Canada Pension Plan and Employment Insurance.

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• CPP Contribution Rate: 5.45% (2021)
• Enhanced contribution rates apply under the gradual phase-in plan since 2019.
• Additional benefits may include employer-funded health, dental, and retirement plans.

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Employee Taxes

Employees are required to pay:

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• Canada Pension Plan Contributions: Up to CAD 3,499.80.
• Employment Insurance Premiums: Up to CAD 952.74.

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Québec Employees:

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• CPP contributions: Up to CAD 3,776.10.
• Employment insurance: Up to CAD 723.60.
• Parental insurance plan: Up to CAD 434.72.

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Notice Period

Notice periods are determined by length of employment:

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• 1 month to 2 years: At least 1 week's notice.
• 2+ years: 1 week per year of service, up to a maximum of 12 weeks.

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Employers may substitute notice with pay equivalent to the notice period.

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Termination and Severance Pay

Employers must provide:

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• At least 2 weeks’ written notice of termination.
• Alternatively, 2 weeks’ wages in lieu of notice.

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Severance pay specifics depend on the province and length of service.