The minimum wage varies across provinces and territories in Canada. Below are the current minimum hourly wages for general labor:
Overtime pay is generally mandatory, except for certain managerial roles. Usually, overtime is compensated at 150% of the regular salary, and employees can work up to 8 hours per week beyond the standard working hours. The standard working hours vary by province and typically amount to around 40 hours per week, from Monday to Friday.
Mandatory benefits for Canadian employees include contributions towards Public Health Insurance, Employment Insurance, Workers Compensation, Registered Retirement Savings Plan, and Pension Plan. Since Canada has a publicly funded healthcare system, there is no obligation for employers to provide health insurance. However, depending on the industry, private health insurance may be offered as a perk by employers.
While there is no legal requirement for employers to offer bonuses to employees in Canada, many companies choose to provide annual or performance-based bonuses as part of their compensation package.
In Canada, employers typically process payroll twice a month, and many companies prefer the following schedule:
1st payroll cycle (1st to 15th):
Payroll cut-off date: 4th of each month
Payment date: 15th day of each month
2nd payroll cycle (15th to last day):
Payroll cut-off date: 20th of each month
Payment date: last day of each month
Individual taxes in Canada vary based on the individual's location. Federal individual tax rates are progressive and calculated as follows:
Income up to $53,359: 15% tax
Income above $53,359 and up to $106,717: 20.5% tax
Income above $106,717 and up to $165,430: 26.0% tax
Income above $165,430 and up to $235,675: 29.0% tax
Income above $235,675: 33% tax
Additionally, Provincial and territorial tax rates are also applied. You can find the specific rates for each province and territory from the appropriate authorities.
In Canada, an employee agreement should contain essential details such as the employee's name, address, job role, a clear job description with measurable duties, start date, compensation, vacation entitlements, benefits, and a termination clause. The contracts must be written in either English or French and can also be bilingual.
Probation periods are not obligatory, and there is no set minimum period. However, the maximum probation period allowed is 90 days.
The notice period required for termination can vary depending on the Employment Standards Act of each province.
In the event of termination without cause, termination pay is provided to the employee. On the other hand, severance pay is granted when there is a mutual separation agreement or when an employee completes a minimum of 12 consecutive months of employment. In federally regulated jurisdictions, eligible employees receive the greater of 2 days' wages per year of service or 5 days' wages as severance pay. The severance pay rates differ based on specific provincial regulations.