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Canada is the most common cross-border hire for US companies — similar culture, overlapping time zones, and a deep talent pool. Rippling EOR handles provincial employment standards, CPP/EI, and TD1 withholding from day one.
Canada is one of the most common international expansion targets for US companies given its geographic proximity, cultural alignment, shared language (English in most provinces, French in Quebec), and deep talent pool in technology, financial services, natural resources, and professional services. Toronto, Vancouver, Montreal, and Calgary are major hubs. Canada's tech sector is particularly strong, with significant talent in AI/ML (Montreal and Toronto are global AI research leaders), cloud infrastructure, and software engineering.
Canadian employment law is primarily provincial, not federal, which creates meaningful complexity: each province has its own Employment Standards Act with different minimums for vacation, termination notice, severance, and leave entitlements. Quebec is distinctly different — French-language requirements, QPIP instead of federal EI, and a separate provincial labor code. EOR is particularly valuable for companies hiring across multiple provinces.
thePeopleStack has deep Canadian compliance expertise given its Victoria, BC headquarters and extensive Rippling configuration experience across all major Canadian provinces.
Incorporating a Canadian federal corporation or provincial company is relatively straightforward (1–2 weeks, $200–$500 in fees) but payroll registration with CRA, provincial payroll tax registration, Workers' Compensation registration, and T4/ROE (Record of Employment) obligations create ongoing compliance overhead. For US companies, the major complexity is provincial variation and Quebec's distinct requirements.
EOR is the right choice for: hiring across multiple provinces (different ESA obligations per province), initial Canadian market testing, fewer than 10 employees, or where Quebec employees require QPIP/QPP compliance. thePeopleStack's familiarity with Canadian provincial nuances across BC, Ontario, and Quebec makes Rippling EOR configuration particularly strong for Canadian hires.
Canada Pension Plan (CPP): 5.95% on pensionable earnings between $3,500 (basic exemption) and $68,500 (2024 YMPE); CPP2 additional contribution 4% on earnings $68,500–$73,200. Employment Insurance (EI): 1.66% on insurable earnings up to $63,200 (2024). Provincial income tax: withheld at source — rates vary by province. Federal income tax: withheld at source — 15% up to $55,867; 20.5% $55,868–$111,733; 26% $111,734–$154,906; 29% $154,907–$220,000; 33% above $220,000 (2024 federal rates). Quebec: QPP (instead of CPP) at 6.4%; QPIP (instead of EI) at 0.494%.
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Canada Pension Plan (CPP): employer matches employee contribution — 5.95% on pensionable earnings up to YMPE ($68,500 in 2024); CPP2: 4% match on earnings $68,500–$73,200. Employment Insurance (EI): 1.4× employee premium = 2.324% on insurable earnings up to $63,200 (2024). Provincial payroll taxes apply in some provinces: Ontario Employer Health Tax (EHT) — 1.95% on payroll above $1M exemption; Quebec HSF (Health Services Fund) — up to 4.26% of total payroll; Manitoba Health and Post-Secondary Education Tax; Newfoundland Payroll Tax. Workers' Compensation: mandatory, rates vary by province and industry classification. Total employer on-cost: approximately 8–15% of salary depending on province and payroll size.
Federal income tax (2024): 15% up to $55,867; 20.5% $55,868–$111,733; 26% $111,734–$154,906; 29% $154,907–$220,000; 33% above $220,000. Basic personal amount tax credit reduces federal tax for lower earners. Provincial income tax is withheld separately — rates vary significantly by province (Alberta lowest at 10–15%; Quebec highest at 14–26% provincial rates). Rippling EOR manages federal and provincial tax withholding and CRA/provincial remittances. T4 slips issued at year-end.
Federal and provincial standards vary. Representative example (Ontario): vacation 2 weeks (2% vacation pay) minimum, increasing to 3 weeks after 5 years; 9 public holidays; sick leave 3 days unpaid (Ontario ESA) — many employers offer paid sick leave by policy; maternity leave 17 weeks (Ontario) + parental leave 61 weeks (standard) or 86 weeks (extended) — EI benefits from federal government. BC: 10 days paid sick leave per year (from January 2022). Federal employees (ESDC): 10 days paid sick leave. Parental leave EI benefit: 55% of insurable earnings for 35 weeks (standard) or 33% for 69 weeks (extended). Public holidays: 8 federal stat holidays; provinces add their own (BC has 10 total).
Notice periods vary by province. Representative examples: Ontario (ESA minimum) — 1 week per year of service up to 8 weeks; BC — 1 week per year up to 8 weeks; Quebec — 1 week (3 months–1 year), 2 weeks (1–5 years), 4 weeks (5–10 years), 8 weeks (10+ years). Common law notice (Bardal factors) can significantly exceed statutory minimums for senior employees and may be required if the contract doesn't limit it to statutory minimums. Severance pay: Ontario requires severance pay for employees with 5+ years' service at companies with $2.5M+ payroll (1 week per year, max 26 weeks). Record of Employment (ROE) must be issued within 5 calendar days of interruption.
Canadian citizens and permanent residents: unrestricted right to work. Temporary foreign workers: employer-specific work permits (most common: LMIA-based permit requiring Labour Market Impact Assessment, or LMIA-exempt under CUSMA/USMCA for US and Mexican citizens in professional categories). International Experience Canada (IEC): open work permits for eligible youth. Global Talent Stream (GTS): fast-tracked 2-week processing for tech talent in specific occupations. Rippling EOR can support LMIA applications and Global Talent Stream processes through its Canadian entity as an approved employer.
Statutory benefits vary by province but include: minimum 2 weeks paid vacation (most provinces), public holidays (8–11 depending on province), Employment Insurance (EI) coverage, Canada Pension Plan (CPP/CPP2) enrollment, and Workers' Compensation coverage. In Quebec, parental insurance (QPIP) is funded separately from federal EI.
Market standard: 3 weeks vacation, extended health and dental benefits (employer typically covers 50–100% of premiums), Group RRSP or DPSP with employer matching, annual bonus, and employee assistance program (EAP). Benefits packages are a key differentiator in the competitive Canadian tech market — extended health/dental is near-universal for salaried employees.
Rippling EOR Canada operates through a Canadian employer entity. As thePeopleStack is based in Victoria, BC, Canada is one of our deepest configuration competencies. Key setup items: province of work determines which ESA applies — always confirm province before contract drafting; Quebec employees require QPP/QPIP configuration instead of CPP/EI; Workers' Compensation registration in each province of employment (WSBC in BC, WSIB in Ontario, CNESST in Quebec); ROE generation upon any employment interruption.
Common client issues we resolve: US clients wanting to classify Canadian workers as 1099-equivalent contractors (not valid in Canada — push toward EOR); vacation pay accrual vs. vacation time (they're not the same thing in all provinces); and year-end T4 filing deadlines (February 28).
Canada has no federal employment standards for most employees — employment law is primarily provincial. This means vacation entitlements, termination notice, and overtime rules differ by province. For example: BC requires 2 weeks' vacation and termination notice of 1 week per year up to 8 weeks; Ontario requires 2 weeks' vacation and 1 week per year up to 8 weeks; Quebec has different standards under the LSST and CCQ. When using Rippling EOR, Rippling applies the correct provincial standard for each employee's province of work automatically.
Record of Employment (ROE) is a Canadian federal document that must be issued when an employee experiences an interruption of earnings (termination, leave of absence, etc.). It is used by Service Canada to determine Employment Insurance (EI) eligibility. Rippling EOR generates and submits ROEs electronically to Service Canada on behalf of the client company through the ROE Web system. T4 slips (annual earnings summary) are also generated and filed by Rippling EOR at year-end.
Quebec employees are subject to Quebec-specific rules: QPP (Quebec Pension Plan) instead of CPP; QPIP (Quebec Parental Insurance Plan) instead of federal EI for parental benefits; provincial income tax filed with Revenu Québec; French-language workplace rights (Charter of the French Language — Bill 96 strengthened French requirements in 2022); and compliance with the Quebec Labor Standards Act (LST) instead of provincial ESAs. Rippling EOR handles all Quebec-specific payroll deductions and filings.
Federal statutory minimum wage is $17.30/hour (from April 2024) for federally regulated employees. Provincial minimum wages vary: BC $17.40/hour (June 2024); Ontario $17.20/hour (October 2024); Alberta $15.00/hour; Quebec $15.75/hour. Rippling EOR automatically applies the applicable provincial minimum wage for each employee.
