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Hire Employees in Canada
Hire in Canada compliantly without setting up a local entity. We manage employment contracts, payroll, tax compliance, and work permits, so you can hire your first Canadian employee in weeks, not months.
Capital
Ottawa
Currency
CAD
Languages
English & French
Min. Wage (ON, 2026)
$17.60/hr
Standard Week
44 hrs
Min. Vacation
2 weeks
Figures shown for Ontario, used as the worked example on this page. Sources: Hicks Morley: Ontario Minimum Wage 2026 · Employment Standards Act, 2000. Ontario's general minimum wage rises to $17.95/hr on 1 October 2026.
WHY CANADA
Why International Companies Are Hiring in Canada
Canada has long been a top destination for international expansion: a stable, English- and French-speaking economy with deep talent pools and close ties to both the US market and the wider world.
Deep, Diverse Talent Pool
World-class universities and high immigration levels make Canada one of the most educated workforces globally, with strong bilingual capability in Quebec.
US Market Proximity
Time zone alignment and cultural familiarity with the US make Canada a natural base for companies expanding across North America.
Stable, Predictable Legal System
A mature common-law framework (civil law in Quebec) gives international employers a well-understood, low-surprise environment to operate in.
Mature Tech & Finance Hubs
Toronto, Vancouver and Montreal are established global hubs for technology, finance and media, and the market is used to international employers.
Multiple Entry Points
Ten provinces and three territories give companies flexibility to choose the market that fits their talent and cost needs best.
Fast, Compliant Onboarding
Via an EOR, hire your first Canadian employee without entity setup, typically in days rather than the months incorporation can take.
“What makes Canada work isn’t any single thing, it’s the combination. Deep, highly educated talent, right next to the US market, in a stable and predictable environment, and through an EOR you can be hiring in days rather than months. Most expansion markets give you one or two of those. Canada gives you the whole set.”
— Gino Peters, CCO of ThisWorks
01 - TALENT MARKET
Understanding the Canadian Job Market
Canada offers a large, well-educated, English- and French-proficient workforce, with strong representation in technology, financial services, and professional services, concentrated in a handful of major metro hubs.
Top cities for recruitment
Toronto
Canada's largest talent pool: finance, tech, professional services, corporate HQ functions.
Vancouver
Tech, gaming, film/media, strong Asia-Pacific business ties.
Montreal
Bilingual (English/French) talent, AI research, gaming, aerospace.
Calgary
Energy sector, increasingly diversifying into tech and finance.
Key industries
Technology & Software
Financial & Professional Services
Natural Resources & Energy
Manufacturing
Media, Gaming & Creative
Indicative average gross salaries (annual, CAD, Toronto)
| Role | Junior | Mid-level | Senior |
|---|---|---|---|
| Software Engineer | $75,000–100,000 | $100,000–130,000 | $130,000–175,000+ |
| Customer Support / BPO | $38,000–48,000 | $48,000–65,000 | $66,000–90,000 |
| Marketing / Sales | $42,000–55,000 | $59,000–75,000 | $75,000–111,000+ |
| HR / Operations | $45,000–55,000 | $55,000–81,000 | $81,000–125,000+ |
Sources: Glassdoor Canada · Payscale · Indeed Canada. Figures are base salary only (excluding bonus, equity, and benefits) and compiled from publicly available market data, not ThisWorks' own placement data. Vancouver and Montreal salaries generally run slightly below Toronto for equivalent roles; Calgary can run higher for energy-sector-adjacent positions.
02 - COMPLIANCE
Legal Requirements for Hiring in Canada
Hiring employees in Canada requires compliance with employment standards, immigration rules, and payroll registration, and, critically, an understanding of how these vary by province.
Work Permits & Immigration
- Canadian citizens and permanent residents: no work permit required
- Foreign nationals generally need a work permit, via either the Temporary Foreign Worker Program (requiring a Labour Market Impact Assessment) or the LMIA-exempt International Mobility Program
- Common LMIA-exempt routes include CUSMA (covering many professional occupations for US and Mexican citizens) and intra-company transfers
Source: Government of Canada: Hire a Temporary Foreign Worker
Employment Contracts Should Include
- Job role and responsibilities
- Compensation, including pay frequency
- Hours of work and overtime terms
- Vacation entitlement
- Termination notice provisions (cannot go below ESA minimums)
Do you need a local entity?
To hire directly in Canada, a company generally needs to incorporate federally or provincially, register for a CRA payroll account, and register with the relevant provincial workers’ compensation board. An Employer of Record lets you hire in Canada without establishing a local entity. ThisWorks becomes the legal employer for payroll, tax and compliance purposes, while you manage the employee day to day. Learn about our EOR service →
03 - CONTRACTS
Contract Types & Probation Periods
Canadian employment is typically indefinite-term (“permanent”) unless a contract specifies otherwise. Fixed-term contracts exist but carry their own rules if repeatedly renewed.
Indefinite (Permanent) Employment
- The default and most common arrangement in Canada
- No fixed end date; ends by resignation, termination, or retirement
- Full ESA and, where applicable, common law protections apply from day one
Fixed-Term Contracts
- Used for defined projects or coverage periods
- Repeated back-to-back renewals can risk being treated as indefinite employment by a court
- Ending a fixed-term contract early can trigger an obligation to pay out the remainder of the term
Probation in Canada works differently to many other countries
Ontario’s ESA doesn’t set a maximum probationary period, but 3 months is standard market practice. Critically, the ESA’s minimum termination notice requirement only applies once an employee has been employed for 3 months or more, so employers generally aren’t required to give statutory notice within a standard probationary period. That said, the ESA doesn’t formally recognise “probation” as a separate legal status beyond that 3-month threshold.
04 - COST OF EMPLOYMENT
What Does It Cost to Hire in Canada?
Canadian employer costs are a mix of capped federal contributions and variable provincial ones, a genuinely different structure to a flat-rate model, and one that’s easy to underestimate.
| Employer Cost Item | Employer Rate |
|---|---|
| CPP (Canada Pension Plan) | 5.95% of earnings, with a smaller CPP2 tier on higher earnings |
| EI (Employment Insurance) | 2.28% of insurable earnings |
| EHT (Employer Health Tax, Ontario) | Up to 1.95% of payroll; applies to larger Ontario employers only |
| WSIB (workers' compensation) | Varies by industry classification |
| Vacation pay | 4% of gross wages, rising to 6% after five years' service |
Sources: Government of Canada: 2026 EI Premium Rate · Workzoom: Canadian Payroll Deductions Guide. CPP and EI rates are set federally and reviewed each January.
“The mistake we see most often isn’t underestimating any single cost, it’s forgetting that Canada doesn’t have one number to budget against. CPP and EI are predictable, but EHT and workers’ compensation depend on your payroll size and industry, so two companies hiring the same role in Ontario can have genuinely different on-costs. That’s why we cost every hire individually rather than working from a rule of thumb.”
— Tarun Arora, Payroll Specialist at ThisWorks
05 — MAKING THE DECISION
EOR vs. Setting Up a Local Entity in Canada
Both routes are compliant ways to hire in Canada. The right choice depends on how established your plans for the market are.
| EOR (via ThisWorks) | Canadian Entity | |
|---|---|---|
| Set-up time | ✓A few days | Several weeks, depending on province |
| Upfront cost | ✓Low, predictable monthly fee | Incorporation, legal, and accounting fees |
| Ongoing admin | ✓Handled by ThisWorks | Managed by your team or a local accountant |
| Payroll & WSIB registration | ✓Included | Separate CRA and provincial registration required |
| Multi-province flexibility | ✓Hire in any province without re-registering | May require extra-provincial registration per province |
| Full operational control | Day-to-day management retained by you | ✓Full legal and operational control |
| Best suited for | Market entry, first hires, testing Canada | Established, long-term Canadian operations |
06 - EMPLOYEE RIGHTS
Employee Rights & Benefits (Ontario)
Working Hours, Leave & Holidays
- 44 hours/week before overtime applies, at 1.5× regular pay
- Vacation: 2 weeks / 4% pay (under 5 yrs' service); 3 weeks / 6% pay (5+ yrs)
- 9 statutory public holidays per year
- 3 unpaid, job-protected sick days per year (ESA minimum)
Sources: Xero: Statutory Holidays in Ontario 2026 · Achkar Law: Sick Days in Ontario
Maternity & Parental Benefits (Federal EI)
- Maternity: up to 15 weeks at 55% of average earnings (max $729/week in 2026)
- Standard parental: up to 40 weeks at 55% (max $729/week), shareable between parents
- Extended parental: up to 69 weeks at 33% (max $437/week), the same total payout as standard, spread over a longer time
- Ontario provides 17 weeks of unpaid, job-protected maternity leave separately from the EI benefit itself
Source: Government of Canada: EI Maternity and Parental Benefits
07 — ENDING EMPLOYMENT
Termination & Notice in Canada
Canadian termination law has two distinct layers: the statutory minimum, and what a court can actually award. Getting only the first half of this right is one of the more expensive mistakes international employers make.
| Length of Service | ESA Minimum Notice (Ontario) |
|---|---|
| Under 3 months | None |
| 3 months – 1 year | 1 week |
| 1–3 years | 2 weeks |
| 3–8 years | 1 additional week per year of service |
| 8+ years | 8 weeks (statutory maximum) |
Statutory minimum ≠ the full picture
The table above is the legal floor. Canadian courts routinely award considerably more than this under common law "reasonable notice," which has no fixed cap and is calculated on factors including the employee's age, seniority, and how easily they could find comparable work. A senior employee with several years of service can be entitled to many months of notice or pay in lieu, not weeks. This is genuinely one of the most legally sensitive areas of Canadian employment law, and case law varies by province.
Source: Employment Standards Act, 2000, Section 57. The common law notice principle is well-established across Canadian case law but should be discussed with a qualified employment lawyer for any specific situation. This page deliberately doesn't quote a specific common-law formula.
08 — HIRING PROCESS
How to Hire in Canada
1
Job Posting
Major boards: LinkedIn, Indeed, and Job Bank (Canada’s government job board).
2
Interviews
Mix of remote/in-person interviews and practical assessments.
3
Reference Checks
Common practice — always confirm with previous employers.
4
Onboarding
A structured process supports faster integration and retention.
09 - WHY THISWORKS
Why Choose ThisWorks for EOR in Canada?
Choosing the right hiring partner is about more than payroll processing. You need a partner who understands the layered nature of Canadian employment law and gives both you and your employee a reliable experience.
Compliant by Design
Employment contracts and payroll built around the specific province you're hiring in, not a one-size-fits-all Canada template.
Fast Onboarding
Once documentation is provided, employees can typically be onboarded within days.
Multi-Province & Multi-Country
Hire across any Canadian province, and beyond. ThisWorks also supports compliant hiring across Europe and South Africa.
Transparent Pricing
A single, predictable monthly fee per employee, with no hidden legal or compliance overhead.
Dedicated HR Support
A named point of contact for your Canada team, not a ticket queue.
Immigration Support
Support for eligible employees through Canadian work permit procedures where required.
“Clients come to us for Canada expecting it to be simple, because on the surface it looks a lot like hiring in the US or the UK. It mostly is, until something goes wrong, and that’s when the provincial differences and the common-law notice question actually matter. We handle that complexity so it never becomes the client’s problem.”
— Juul Seuren, HR Consultant at ThisWorks
10 - HOW WE HELP
ThisWorks Services in Canada
Whatever stage of Canadian expansion you’re at, we have a service built for it.
Employer of Record
Hire in Canada without a local entity: full compliance, payroll and HR handled.
Learn more →Payroll Services
Canadian payroll outsourcing, including CPP, EI and provincial remittances.
Learn more →Work Permit & Visa Services
Support for foreign hires requiring a Canadian work permit.
Learn more →Entity Setup
If and when you're ready to establish your own legal entity in Canada.
Learn more →11 - FAQS
Frequently Asked Questions
Do I need a work permit to hire employees in Canada?
Canadian citizens and permanent residents don’t require one. Foreign nationals generally need a work permit, either through the Temporary Foreign Worker Program or an LMIA-exempt route under the International Mobility Program, such as CUSMA for US and Mexican professionals.
Do employment standards differ by province in Canada?
Yes. Canada has no single national employment code, so minimum wage, vacation entitlements, notice periods and statutory leave are all set provincially. This guide uses Ontario as a worked example.
What is the minimum wage in Ontario?
Ontario’s general minimum wage is $17.60/hr, rising to $17.95/hr on 1 October 2026. Other provinces set their own rates.
What's the difference between ESA notice and common law notice in Canada?
The Employment Standards Act sets a statutory minimum notice period for termination. Canadian courts can award considerably more than this minimum under common law, depending on factors like the employee’s age, role and length of service.
How long is probation in Canada?
There’s no statutory maximum in Ontario, but 3 months is standard market practice. The ESA’s minimum notice requirement only applies once an employee has 3 months of service, regardless of whether a contract labels that period as “probationary.”
Do I need a local entity to hire in Canada, or can I use an EOR?
No. An Employer of Record lets you hire employees in Canada without registering a local entity. ThisWorks becomes the legal employer of record for compliance purposes, while you continue to manage the employee’s day-to-day work.
How much does it cost to hire an employee in Canada?
Beyond salary, employers pay CPP, EI, and, depending on the province and payroll size, additional costs like Ontario’s Employer Health Tax and workers’ compensation premiums. See the cost breakdown above for current rates.
What does an Employer of Record in Canada do?
An Employer of Record in Canada handles employment contracts, payroll, CPP/EI remittances, and statutory benefits administration on your behalf, acting as the legal employer while you retain operational control of the employee.
We're ready to support your expansion into Canada
Manager Backoffice / Payroll at ThisWorks
“The part that catches people out in Canada is that payroll and employment rules aren’t one national system, they run province by province. It sounds more complicated than it is. Once someone’s set it up properly for the provinces you’re hiring in, running a Canadian team is genuinely low-maintenance.”
