Payroll compliance in Canada
Canada, the world’s ninth-largest economy by GDP, has a well-developed framework of payroll-related legislation at both federal and provincial levels. The country ranked 52nd for the complexity of its business environment according to TMF Group’s 2022 Global Business Complexity Index, making it one of the easier countries in which to do business – including meeting payroll compliance requirements.
The Canada Labour Code is the primary labour law that governs employment in Canada, including workplace health and safety, industrial relations, working hours, minimum wages, leave entitlement, layoff procedures and severance pay. Each province also has its own labour codes.
- A key piece of payroll-related legislation, the Pay Equity Act, came into effect in Canada in August 2021. This is designed to ensure that women and men in federally regulated workplaces – including the federal public and private sectors, parliamentary workplaces and the Prime Minister’s and ministers’ offices – receive equal pay for work of equal value.
- Standard working hours for employees regulated by the Canada Labour Code are eight hours in a day and 40 hours in a week. However, these also vary by province: an employee can work for a maximum of 40 hours per week in British Columbia, 48 hours per week in Ontario and 44 hours per week in Alberta, for example.
- Payroll cycles also vary from province to province in Canada. For example, in British Columbia wages must be paid at least bi-monthly and within eight days after the end of the pay period, while in Quebec wages have to be paid at intervals of no more than 16 days.
If you’re doing business in Canada and are looking to learn more about Canada’s labour laws, incorporation procedures, tax implications and compliance requirements, request a copy of our full country profile, Doing business in Canada.