Canada is one of the most attractive hiring destinations in the world. It offers a highly skilled, bilingual workforce, a stable regulatory environment, and proximity to the United States. But hiring here without local expertise is a compliance minefield. Each province operates under its own employment standards legislation, with distinct rules on notice periods, statutory holidays, payroll taxes, and termination entitlements. A compliance misstep in Ontario carries different risks than one in Quebec, and the costs of non-compliance can be high.
An employer of record in Canada is the fastest, most reliable way to hire compliantly across any or all provinces without setting up a legal entity.
Hire employees in Canada with Multiplier EOR
Multiplier acts as the legal employer for your employees in Canada, employing them through its own locally registered entity. You direct the day-to-day work; Multiplier handles everything else.
That means employment contracts, payroll processing, CPP and EI remittances, provincial health tax, onboarding, benefits administration, statutory leave tracking, and full compliance with both federal and provincial Canadian employment laws.
Companies expanding into Canada can hire their first employee in as little as 48 hours without forming a subsidiary, registering a payroll account, or engaging a local law firm.
Whether you are hiring one software engineer in British Columbia or building a 50-person sales team across Ontario and Quebec, Multiplier’s Employer of Record services give you a single contract, a single invoice, and one platform to manage your entire Canadian workforce.
Employ top talent in Canada through an EOR
Onboard, pay, and manage all your international employees
Canada hiring at a glance
Use this quick-reference table before you hire your first employee in Canada.
Category | Detail |
Capital | Ottawa |
Currency | Canadian Dollar (CAD) |
Official languages | English and French (French is the sole official language in Quebec) |
Standard working week | 40 hours (44 hours in Ontario before overtime applies) |
Payroll frequency | Semi-monthly or bi-weekly |
Federal minimum wage | CAD $18.15/hour (effective April 1, 2026) |
Provincial min. wage examples | Ontario: $17.60; BC: $17.85; Quebec: $16.10; Alberta: $15.00 |
Annual leave | 2 weeks minimum (after 1 year); 3 weeks after 3-5 years (varies by province) |
Public holidays | 5 federal + additional provincial (9-13 per province) |
Employer contributions | CPP 5.95%, EI 2.30%, plus provincial health tax |
Employee contributions | CPP 5.95%, EI 1.64% |
Main labor authority | Employment and Social Development Canada (ESDC) + provincial ministries of labor |
EOR benefit | Hire in any province in 24-72 hours with zero entity setup cost |
What is an employer of record in Canada?
An Employer of Record (EOR) is a third-party organization that becomes the legal employer of your workforce in Canada. The EOR signs employment contracts, runs payroll, remits statutory contributions to the Canada Revenue Agency (CRA), and ensures compliance with both federal and provincial employment standards. You retain full operational control over the work.
The alternative is incorporating a Canadian subsidiary or branch, which typically costs between $5,800 and $18,100 (CAD $8,000 to CAD $25,000) in legal and registration fees and takes two to four months before you can make a single hire. With an EOR, you can onboard a Canadian employee in 24 to 72 hours, with no ongoing entity maintenance obligations.
This model matters especially for companies testing a new market, hiring a small but growing team, or responding quickly to a business opportunity. Using an EOR is the legally recognised approach to compliant cross-border employment, and thousands of global companies use it to hire in Canada today.
Key compliance obligations when hiring in Canada
Canada operates under a layered compliance framework. Federal law governs federally regulated industries such as banking, telecoms, and interprovincial transport. All other employers fall under their province’s employment standards legislation. Understanding which law applies and meeting the higher standard where they overlap is the foundation of compliant hiring.
Employment contracts
There is no mandatory language requirement for employment contracts at the federal level. In Quebec, however, employment contracts and workplace communications must comply with the Charte de la langue française (Charter of the French Language). Since June 2025, any employer with 25 or more employees in Quebec must register with the Office québécois de la langue francaise and meet francization obligations. Bilingual contracts are strongly recommended for Quebec hires, with the French version taking legal precedence in any dispute.
Employment contracts in Canada typically cover: contract type (indefinite-term or fixed-term); probationary period (commonly up to three months, though not prescribed uniformly); compensation and pay frequency; hours of work and overtime thresholds; termination and notice provisions (must meet or exceed statutory minimums); and confidentiality and intellectual property clauses.
Fixed-term contracts do not automatically trigger notice obligations upon expiry in most provinces, but misclassifying a permanent role as fixed-term to avoid notice liability is a risk Canadian courts examine closely.
Social insurance and payroll contributions
Canada’s core payroll contributions are the Canada Pension Plan (CPP) and Employment Insurance (EI). Both are mandatory, both are split between employer and employee, and both are remitted to the CRA on a regular schedule. Outside Quebec (which operates its own QPP and QPIP), the 2025-2026 rates are:
Contribution type | Employer rate | Employee rate |
Canada Pension Plan (CPP) | 5.95% of pensionable earnings | 5.95% of pensionable earnings |
CPP2 (earnings above YMPE, up to YAMPE) | 4.00% on applicable slice | 4.00% on applicable slice |
Employment Insurance (EI) | 2.30% of insurable earnings (1.4x employee rate) | 1.64% of insurable earnings |
Ontario Employer Health Tax (EHT) | Up to 1.95% (payroll above CAD $1 million) | Nil |
BC Employer Health Tax (EHT) | 1.95% (payroll above CAD $1.5 million) | Nil |
Quebec Health Services Fund (HSF) | 1.25-4.26% depending on total payroll | Nil |
Quebec Parental Insurance Plan (QPIP) | 0.692% of insurable earnings | 0.494% of insurable earnings |
In total, employer social contributions run approximately 11.5 to 13% on top of base salary, depending on province and employee earnings. Use Multiplier’s employee cost calculator for a precise figure on any Canadian hire.
Termination and notice periods
Canada’s termination framework has two layers, and both matter. The first layer is statutory minimums set by each province’s employment standards legislation. These are the floors every employer must meet: one week per year of service up to eight weeks in most provinces (Ontario, BC, Alberta); one to eight weeks in Quebec, depending on service length.
The second layer is common law reasonable notice. Canadian courts regularly award one month of notice per year of service up to a ceiling of 24 months, accounting for the employee’s age, seniority, and the availability of comparable employment. For long-tenured employees in senior roles, this can represent a significant liability. Employment contracts should include a clear, judicially reviewed termination clause that caps notice at the statutory minimum to limit exposure, though Ontario courts scrutinize such clauses particularly closely.
Ontario also requires additional statutory severance pay (one week per year of service, up to 26 weeks) for employees with at least five years of service at employers with a CAD $2.5 million or more payroll. Quebec protects after two years of service, including reinstatement rights for employees dismissed without good and sufficient cause.
Working hours and overtime in Canada
Standard working hours in Canada are set at the provincial level. Most provinces set the standard work week at 40 to 44 hours before overtime applies. Overtime is paid at 1.5 times the regular rate across all provinces. Key thresholds:
- Ontario: Overtime after 44 hours per week
- British Columbia: Overtime after eight hours per day or 40 hours per week (daily threshold applies)
- Alberta: Overtime after eight hours per day or 44 hours per week
- Quebec: Overtime after 40 hours per week
Most provinces permit overtime-averaging agreements under certain conditions. Employees cannot waive their entitlement to overtime compensation outright, though many provinces allow employees to take time off in lieu of overtime pay by agreement.
Most provincial legislation requires at least eight hours between shifts and one full day of rest per week.
Leave and employee benefits in Canada
Canada provides a comprehensive statutory leave framework funded through Employment Insurance and provincial programs. Employers are not generally required to top up EI payments during statutory leave, though many do as part of competitive benefits packages.
Leave type | Entitlement |
Annual (vacation) leave | 2 weeks minimum (most provinces); 3 weeks after 5 yrs in ON, BC, AB; 3 weeks after 3 yrs in Quebec |
Sick/personal leave | Ontario: 10 days (3 paid); BC: 5 paid + 3 unpaid; Quebec: 2 paid + unpaid; Alberta: 5 days unpaid |
Maternity leave | 17 weeks (Ontario ESA); 18 weeks under Quebec’s QPIP |
Parental leave | Up to 63 weeks combined (standard EI); 71 weeks (extended EI option) |
Compassionate care leave | Up to 28 weeks per year (federal EI) |
Public holidays | 9-11 paid days depending on the province |
Bereavement leave | 3 paid days (Ontario); 3-5 days vary by province |
EI pays maternity and parental benefits at 55% of insurable earnings (standard rate) up to a weekly maximum. Quebec employees use the QPIP instead of federal EI for parental benefits, which provides more generous rates. Quebec employers remit QPIP premiums separately in addition to federal EI.
EOR vs setting up an entity in Canada
Deciding how to structure your Canadian hiring has real cost and timeline implications. The table below compares the most common models.
Model | Best for | Local entity required? | Compliance responsibility | Speed to hire | Approximate cost |
EOR | Testing the market, any team size, speed | No | EOR manages all compliance | 24-72 hours | Flat monthly fee per employee |
Subsidiary (corporation) | Large, established presence; full brand control | Yes | Employer manages compliance | 2-4 months | $5,800–$18,100+ (CAD $8,000–$25,000+) setup |
PEO | Co-employment; existing entity in place | Usually yes | Shared: PEO and employer | Weeks | Setup fees + per-employee cost |
Contractor | Short-term, project-based work | No | Contractor responsible | Immediate | Varies; misclassification risk |
Direct hire | Full autonomy; entity already in place | Yes | Employer manages compliance | Months | Entity + payroll registration |
For most companies hiring their first Canadian employees, an EOR eliminates entity incorporation costs while providing the same legal standing as a local employer. Entity setup in Canada costs CAD $8,000 to $25,000 in legal and registration fees and takes two to four months. An EOR gets you compliant in 48 hours.
Why choose Multiplier as your Canada EOR
When you hire in Canada through Multiplier, you get a legally accountable employer with a locally registered entity, expert compliance management across all provinces, and a platform built for the way global teams work.
Owned entities, no third-party relay
Multiplier employs directly through its own locally registered entity in Canada. No third-party relay, no split accountability. When a compliance question arises or a termination needs to be managed, there is one party responsible: Multiplier.
Predictable total cost
Flat monthly fee per employee. No onboarding fees, no termination fees, no FX markup on Canada payroll. You know your total employer cost before you make a hiring decision.
Best-in-breed integration
Connects via API to Workday, BambooHR, HiBob, Personio, and UKG. Your Canadian employees appear in your existing HR stack from day one, with no duplicate data entry and no manual payroll reconciliation.
Multiplier is rated #1 on G2 for three consecutive quarters (4.7/5, 1,200+ reviews) and trusted by 2,000+ customers, including Uber, Amazon, and PwC. Book a demo today.
FAQs
What is an employer of record in Canada?
An employer of record in Canada is a company that employs workers on behalf of another organization. The EOR signs employment contracts, runs payroll, remits CPP and EI contributions to the CRA, and ensures compliance with federal and provincial employment standards. The client company directs the day-to-day work. Multiplier acts as the employer of record in Canada through its own locally registered entity, covering all ten provinces and three territories under a single contract.
Can a US company hire Canadian employees without setting up a Canadian entity?
Yes. A US company can hire employees in Canada through an employer of record without incorporating a Canadian subsidiary or registering a payroll account. The EOR is the legal employer for all statutory purposes. This approach also avoids permanent establishment risk, which can arise when a foreign company has employees carrying on business activities in Canada without a local entity.
Does an EOR manage payroll in Canadian dollars?
Yes. Multiplier processes payroll in CAD and remits statutory deductions directly to the CRA and applicable provincial revenue authorities. Employees receive payslips in Canadian dollars with all required deductions applied, and there are no foreign exchange markups on payroll processing.
How quickly can I onboard an employee in Canada through an EOR?
With Multiplier, most Canadian employees are onboarded within 24 to 72 hours of completing required documentation. This compares with two to four months to incorporate a Canadian subsidiary and register for payroll. The timeline assumes the employee is a Canadian citizen or permanent resident; foreign nationals require a valid work permit before employment can begin.
What types of employment contracts are used in Canada?
Canada uses indefinite-term and fixed-term contracts. Indefinite-term (open-ended) contracts are most common for full-time employment. Fixed-term contracts are used for defined project work but carry risk if courts determine the relationship is substantively permanent. In Quebec, contracts must comply with the Charte de la langue française; bilingual contracts with French-language primacy are standard practice.
Do employment contracts in Canada need to be in French?
At the federal level, there is no mandatory language requirement. In Quebec, the Charte de la langue française requires that employees be able to work in French and that employment contracts be provided in French. Bilingual contracts are strongly recommended, with the French version taking precedence in Quebec.
What are the payroll tax obligations for Canadian employers?
Look for a partner that knows Canadian employment law, can clearly explain their pricing, can onboard new employees quickly, offers localized benefits, and understands how to utilize the platform effectively.
What is the minimum annual leave entitlement in Canada?
Most provinces require two weeks of paid vacation after one year of continuous service (4% of gross wages). After five years, most provinces increase this to three weeks (6%). Quebec reaches three weeks after three years of service. Multiplier tracks vacation accruals and manages leave balances for all Canadian employees.
Do foreign workers need a visa to work in Canada?
Yes. Foreign nationals require a valid work permit before employment can begin. Common pathways include the Temporary Foreign Worker Program, open work permits, and CUSMA/USMCA professional permits for US and Mexican nationals. Canadian citizens and permanent residents require no work authorization.
How does termination work in Canada?
Termination without cause requires working notice or pay in lieu equal to at least the provincial statutory minimum. Ontario ESA requires one week per year, up to eight weeks, plus qualifying severance. Common law notice can be significantly higher, up to one month per year of service for senior employees. Multiplier manages all termination calculations, final pay, and Records of Employment filing.
What is the difference between an EOR and a PEO in Canada?
An employer of record is the sole legal employer and assumes full compliance responsibility. A PEO typically operates as a co-employer alongside the client company, which generally requires the client to have an existing Canadian entity. For companies without a local entity, only an EOR model provides compliant hiring. See our EOR vs PEO comparison for details.
How much does an employer of record in Canada cost?
EOR pricing typically ranges from USD $299 to $699 per employee per month, depending on the provider. Multiplier charges a flat monthly fee with no onboarding fees, no termination fees, and no FX markups. This compares favourably with the $5,800 and $18,100 (CAD $8,000 to CAD $25,000) of incorporating a Canadian subsidiary plus ongoing legal, accounting, and payroll administration. Use Multiplier's employee cost calculator to model the total cost of any Canadian hire.
