Employer of Record in Canada (EOR in Canada)

Hire Globally, Pay Locally, Expand Effortlessly

Canada, a developed economy with a strong reputation for stability and quality of life, offers numerous opportunities for businesses looking to expand their operations in North America. However, understanding its complex labor and tax regulations is crucial for successful operations. An Employer of Record (EOR) in Canada can provide the necessary expertise and support.

Want to have a Team in Canada TODAY?

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Want to Have a Team in Canada TODAY?

Show me how to grow my business now!

We prefer to let others grow their business.

How an EOR in Canada Streamlines Your Expansion in 3 Steps

Step 1 – Thorough Planning & Assessment

Collaborating with a Canadian EOR like INS Global starts with a detailed consultation to understand your business objectives. This involves assessing the number of employees required, defining their roles, and establishing a timeline for your expansion. The EOR tailors its services to align with your specific needs, ensuring a smooth integration process in Canada.

Step 2 – Streamlined Setup, Recruitment & Onboarding

Whether you’re establishing a new team in Canada or relocating existing personnel, the EOR manages all legal and administrative requirements. This includes handling visas, work permits, payroll, contract management, and ensuring compliance with Canadian labor laws. Acting as your legal employer in Canada, the EOR eliminates the need for setting up a local entity, saving both time and money.

Step 3 – Ongoing HR Management & Compliance

Once your employees are active in Canada, the EOR takes care of ongoing HR and payroll responsibilities. This includes processing salaries, managing employee benefits, and ensuring health insurance and social security contributions compliance. The EOR serves as the HR intermediary between you and your Canadian team, handling administrative tasks and addressing employee concerns, allowing you to focus on business growth confidently.

Benefits of Partnering with a Canadian EOR

Quick Market Penetration

Partnering with a Canadian EOR allows you to swiftly enter the Canadian market without the need to establish a local legal entity, accelerating your expansion efforts.

Compliance with Canadian Regulations

The EOR ensures your business operations in Canada adhere to local labor laws, including employment contracts, taxes, and employee benefits, mitigating legal risks.

Access to Canadian Talent

The EOR supports the recruitment and management of local employees, providing access to Canada’s diverse talent pool while handling all employment-related responsibilities.

Cost-Effective Expansion

A Canadian EOR helps you avoid the significant costs of setting up and maintaining a local entity. The EOR manages payroll, benefits, and HR tasks, allowing you to focus on scaling your business.

Operational Flexibility

A Canadian EOR offers the flexibility to adjust your operations as needed without the complexities and long-term commitment of establishing a local entity, making it easier to adapt to market conditions.

Testimonial

Manuel Ramos

TERAO ASIA

Managing Director

We think INS Global is a good solution about starting business in new and complex markets. Understanding the market doesn’t mean you need to set up a company immediately.

 5/5

EOR vs. Company Incorporation in Canada: Making the Right Choice

While establishing a subsidiary in Canada is a well-known route for local expansion, using an EOR offers several distinct advantages:

Speed – With an EOR like INS Global, the setup process in Canada is significantly faster, allowing you to start operations and hire staff much quicker than traditional company incorporation, which can take months. An EOR can have your team operational within weeks or even days.
Compliance – Both EORs and subsidiaries must adhere to Canadian tax laws and labor regulations. EORs have the expertise to navigate these complexities and ensure ongoing compliance, reducing the risk of legal issues.
Cost – For smaller teams or temporary needs, EOR services are often more cost-effective than establishing a subsidiary, as they avoid the substantial upfront costs of incorporation and ongoing administrative expenses. For larger companies, EORs provide streamlined solutions that efficiently integrate new markets into multi-country payroll systems.
Control – While incorporating provides full control over HR, finances, and operations, EORs offer similar control over your workforce while reducing administrative responsibilities and liability.

Key Considerations for Choosing the Ideal Employer of Record in Canada

Choosing the right EOR in Canada is essential for successful market entry. Consider these crucial factors:

Professional Expertise and Industry Standing – Search for a Canadian EOR with proven experience and a solid industry standing, like INS Global. Client reviews and industry accolades are good indicators of their reliability.
Full-Service Capabilities – Ensure the EOR provides all necessary services or can customize their offerings to suit your needs, including visa and work permit support, payroll processing, tax compliance, and navigating Canada’s labor regulations.
Service Scalability – Opt for an EOR that can expand its services as your business grows. Their team should be capable of managing an increasing workforce and evolving business requirements.
Transparent Communication and Consistency – Choose an EOR known for clear and consistent communication. They should keep you well-informed about regulatory updates, upcoming deadlines, and potential issues, offering a dedicated point of contact and online tools for easy access to critical information.
Fair and Transparent Costs – Review the pricing models of different EORs. Ensure their fees are clear, competitive, and free of hidden charges. Third-party advice can help you obtain the best value for your EOR in Canada.

Canada Labor Law Overview

Contracts – In Canada, employment contracts outline the rights and duties of both employers and employees. These contracts, whether written or verbal, must comply with federal and provincial employment standards. Written contracts are preferred to avoid disputes, especially over terms like termination clauses. Contracts that fail to meet minimum legal standards are void. Around 75% of employment disputes in Canada involve contract issues, underscoring the need for clear, legally compliant agreements.
Probationary Periods – Canadian employers often use probationary periods, typically lasting 3-6 months, to assess a new employee’s suitability. During this time, employees may be terminated with limited notice, but they are still protected by laws against unfair dismissal. Around 20-25% of Canadian employers include probationary periods, especially in industries with high turnover or specific skill requirements.
Working Hours – Standard working hours in Canada are usually 8 hours per day and 40 hours per week, with overtime paid at 1.5 times the regular rate. Regulations can vary by province and industry, with about 17% of Canadian workers regularly working overtime, particularly in sectors like healthcare and finance. Flexible working arrangements are becoming more common to support work-life balance.
Paid Leave – Canadian labor law ensures employees are entitled to paid leave, including vacation, statutory holidays, and sick leave. Most employees start with two weeks of vacation after one year of work, with some provinces offering more. Sick leave and statutory holiday entitlements vary by province, with federally regulated workers entitled to up to 10 paid sick days annually. On average, Canadians take 7.4 sick days per year.
Social Insurance – Canada’s social insurance programs, including the Canada Pension Plan (CPP) and Employment Insurance (EI), provide income support for unemployment, sickness, and retirement. Funded by payroll deductions, these programs cover over 20 million Canadians. As of 2023, CPP and EI contributions are capped at approximately $3,500 and $889 annually per employee, respectively.
Severance Pay – Severance pay compensates Canadian employees who are terminated without cause, helping them transition to new jobs. Entitlements depend on factors like length of service and contract terms. For example, under the Canada Labour Code, employees with 12 months of service are entitled to a minimum of 2 days’ wages per year of service. In Ontario, some workers can receive up to 26 weeks’ pay, with about 10% of Canadian workers receiving severance annually.

Navigating these complexities can be time-consuming and requires staying updated on legal changes. Partnering with an EOR in Canada acts as your local legal partner, ensuring your business remains compliant with labor laws and protects you from potential risks.

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FAQs

How does an EOR facilitate market entry in Canada?

An EOR in Canada takes charge of all necessary legal, HR, and compliance work, enabling businesses to quickly enter the Canadian market without setting up a local entity.

What financial advantages are offered by using an EOR in Canada?

Opting for an EOR in Canada is often more cost-effective than establishing a local subsidiary, as it eliminates the need for incorporation and reduces ongoing administrative expenses.

Can an EOR manage the visa and work permit processes in Canada?

Yes, a Canadian EOR oversees the visa and work permit application process, ensuring compliance with local immigration laws and procedures.

Which types of businesses benefit most from EOR services in Canada?

Businesses of all sizes, particularly those seeking swift market entry, cost savings, and reduced administrative burdens, benefit from EOR services in Canada.

How does an EOR ensure compliance with Canadian labor laws?

EORs in Canada employ local experts who stay informed about legal changes, managing all compliance-related tasks to ensure adherence to Canadian labor laws.

What control do I retain over my employees when using an EOR in Canada?

Although the Canadian EOR is the legal employer, you retain substantial control over daily management and strategic decisions related to your employees.

Employer of Record in Canada (EOR in Canada)

Hire Globally, Pay Locally, Expand Effortlessly

How an EOR in Canada Streamlines Your Expansion in 3 Steps