Employer of Record (EOR) in Canada
Easily hire employees in Canada without establishing a local business entity. Native Teams simplifies expanding your workforce internationally by handling local laws, taxes, and payroll management. Focus on growing your business while we ensure compliance.
How does an EOR in Canada work?
Partnering with an EOR provider like Native Teams enables businesses to expand internationally without the need to establish a local legal entity or navigate complex legal frameworks. The EOR handles all administrative responsibilities, including payroll processing, employment contract preparation, onboarding, and compliance with local labour laws. At the same time, businesses retain complete control over the daily management of their employees.
EOR services are also an excellent option for freelancers, remote workers, and digital nomads seeking formal employment status. This arrangement allows them to enjoy the benefits of traditional employment, such as private health insurance, pension contributions, and secure, legally binding contracts, while maintaining the flexibility of their work arrangements.
Who can use EOR services in Canada?
An Employer of Record (EOR) is an excellent option for businesses looking to expand their global workforce effortlessly and for solo professionals seeking the advantages of traditional employment.
Businesses
EOR services in Canada offer valuable support to companies of all sizes, from small startups to large multinational enterprises. These services are ideal for businesses aiming to expand into Canada without the complexities of setting up a local legal entity. By partnering with an EOR, companies can hire local talent, manage payroll efficiently, and fully comply with Canadian labour laws and regulations.
Individuals
Freelancers, remote workers, and consultants can also benefit from EOR services in Canada. An EOR enables individuals to obtain formal employment while fulfilling all tax, social security, and statutory obligations. This arrangement allows them to enjoy the perks of traditional employment while maintaining flexibility in their work arrangements.
Features of Native Teams’ EOR services in Canada
Employment status
Through Native Teams EOR services, freelancers can sort out their employment status no matter where they live and work compliantly. Employers can compliantly hire, onboard, and pay their global team members.
HR administration and documentation
We will automate all the HR administration and provide you with all the necessary documentation. You’ll be able to access everything with just one click in your Native Teams dashboard.
Global payroll
With our payroll calculator available in 85+ countries, freelancers and employers can easily calculate salary, taxes, benefits, and other deductions. Employers can easily manage a global payroll for all employees on a single platform.
Benefits
Freelancers can enjoy the best of both worlds — the flexibility of freelancing and the perks of regular employment like healthcare, insurance, and pensions. Employers can offer these benefits to attract and retain the best talent on their team.
Dive deeper into Canada’s labour laws and regulations with our hiring guide.
What legal requirements exist for employment in Canada
Employment contract
Employers in Canada must provide their employees with a written employment contract that complies with Canadian labour laws. This document should outline key details such as job title, responsibilities, working hours, salary, benefits, and conditions for termination. Employment contracts help ensure transparency and protect the rights of both parties.
Social security contributions
Employers are required to register employees with the Canada Pension Plan (CPP) and Employment Insurance (EI) programs. Contributions to these programs are mandatory and are deducted from employees’ wages, with matching contributions made by the employer. These contributions provide employees with access to retirement pensions, disability benefits, and income support during periods of unemployment or leave.
Payroll deductions
Employers must deduct and remit income tax, CPP contributions, and EI premiums to the Canada Revenue Agency (CRA) regularly. Failure to comply with these requirements can result in penalties and interest charges.
Work permits
For foreign nationals working in Canada, employers may need to sponsor work permits as part of the hiring process. This involves meeting specific criteria set by the federal government and ensuring that employment complies with immigration laws.
Compliance with labour laws
Employers must adhere to federal, provincial, and territorial employment standards, which govern minimum wage, working hours, overtime pay, statutory holidays, leave entitlements, and termination procedures. Regulations may vary depending on the jurisdiction.
Occupational health and safety
Employers are legally obligated to provide a safe and healthy work environment for employees. Compliance with provincial or territorial occupational health and safety laws is essential to prevent workplace injuries and illnesses.
Employee benefits
Employers must offer mandatory benefits such as EI and CPP contributions, and some provinces may require additional benefits like workers' compensation coverage. Employers may also provide optional benefits, such as private health insurance, retirement savings plans, or wellness programmes, to attract and retain talent.
Please note that specific legal requirements may vary depending on the province or territory, the type of job, and individual circumstances.
Why choose Native Teams as your Canada Employer of Record?
Navigating the complexities of Canada’s legal and regulatory employment landscape can be time-consuming and resource-intensive for businesses. Native Teams simplifies this process by managing all employment-related legal and administrative requirements, enabling you to focus on growing your business.
With legal entities in over 85+ countries, Native Teams has extensive experience managing employment across borders. Our in-depth knowledge of Canadian labour laws allows us to provide reliable, hassle-free EOR services tailored to your needs. By choosing Native Teams as your Canada Employer of Record, you eliminate the need to establish a legal entity in Canada, saving time, resources, and potential compliance risks. Whether you're expanding into the Canadian market or hiring remote talent, our all-in-one platform simplifies the process so you can focus on achieving your business goals.
``What is an Employer of Record?
An Employer of Record (EOR) is a third-party organisation that legally employs workers on behalf of another company. The EOR takes on all administrative and legal responsibilities related to employment, such as payroll processing, tax withholding, compliance with labour laws, and benefits administration. This allows businesses to expand into new markets without needing to establish a local legal entity.
For individuals such as freelancers or remote workers, an EOR provides formal employment status, helping them access traditional employee benefits like healthcare, pensions, and statutory protections while maintaining their flexible work arrangements.
What are the costs of using an Employer of Record in Canada?
The costs of using an Employer of Record (EOR) in Canada depend on the provider, the number of employees being managed, and the scope of services required.
Native Teams offers competitive pricing tailored to your employment needs. Business plans for EOR services start at €79 per month per employee, covering all essential aspects of legal employment, including payroll, compliance, and benefits administration. For individuals, plans start at €49 per month, offering the tools necessary to formalise their employment status and access benefits.
What is the difference between PEO and EOR?
The key distinction between a Professional Employer Organisation (PEO) and an Employer of Record (EOR) lies in their roles and responsibilities.
An EOR is the legal employer of your workforce, assuming full responsibility for payroll, tax compliance, benefits, and adherence to local labour laws. This is ideal for companies expanding into a new country without establishing a local entity.
On the other hand, a PEO operates under a co-employment model. While it handles HR functions like payroll and benefits, the client company remains the legal employer and shares responsibility for compliance. PEO services are most suitable for companies with an existing legal presence in the country.
What are the responsibilities of an Employer of Record (EOR) service provider?
An Employer of Record (EOR) service provider acts as the official employer for your workforce, ensuring full compliance with local laws and regulations. Key responsibilities include:
- Payroll processing: Calculating and distributing salaries, taxes, and deductions.
- Compliance management: Ensuring all employment practices align with local labour laws.
- Employment contracts: Drafting legally compliant contracts tailored to local requirements.
- Benefits administration: Managing mandatory and optional employee benefits.
- Onboarding and offboarding: Overseeing employee entry and exit processes, including documentation.
- Risk mitigation: Taking on liability for employment-related issues, reducing risks for the client company.
By handling these tasks, an EOR enables businesses to focus on managing their workforce and core operations.
Is using an Employer of Record in Canada legal?
Yes, using an Employer of Record (EOR) in Canada is completely legal. EOR services operate within the framework of Canadian labour laws and regulations, providing a compliant solution for businesses looking to hire employees without establishing a local entity.
Many companies rely on EOR services to navigate the complexities of Canadian employment laws, ensuring payroll, taxes, and benefits are handled correctly while reducing administrative burdens.
Why should I use an EOR instead of opening my own company or an office in Canada?
Using an EOR allows businesses to expand into Canada without the need to set up a local entity, which can be a time-consuming and costly process. Establishing a business in Canada requires navigating complex regulatory requirements, registering with local authorities, and adhering to ongoing legal obligations.
An EOR simplifies this process by becoming the legal employer for your workforce, handling payroll, taxes, benefits, and compliance. This enables you to operate quickly and efficiently without long-term commitments. Additionally, if market conditions change or your business priorities shift, you can easily scale operations without the challenges of closing a legal entity or managing local contracts.
How many people can I employ in Canada?
There is no specific legal limit on the number of employees you can hire in Canada, provided you meet all labour law and regulatory requirements.
With an EOR like Native Teams, you can employ as many individuals as your business needs, whether it’s a single hire or an entire team. The EOR handles the complexities of managing employees, from payroll and benefits to compliance, enabling you to focus on scaling your workforce effectively.