How does the cost of using a Canada PEO compare to hiring employees directly?
If your company is headquartered in Canada, the better choice is likely to hire directly. But as a company operating globally and seeking to bring on talent in a new country – in this case Canada, working with a PEO is often seen as the more, efficient, cost-effective option. That’s because it doesn’t require you to open an entity, and saves you the trouble that comes with that.
What is the difference between a Canadian employer of record and a Canadian PEO?
In most cases, EOR and PEO are used interchangeably, both referring to cases when an organization manages payroll and HR operations on behalf of the client company, all the while taking full liability for these tasks.
In some countries, though, these definitions may change slightly. In the US, for example, PEO is used to refer to a situation where two companies have a co-employment agreement, where one handles HR and payroll tasks and the other handles core business and day-to-day responsibilities. Under this definition of PEO, both companies have shared liability.
How does hiring through a Canadian PEO differ from hiring as a traditional employer?
If you’re taking on employees in Canada through traditional employment, you’re also taking on the responsibility of learning the ins and outs of the tax and regulatory requirements in the country, as well as the cultural expectations regarding benefits, PTO, and other considerations.
If you’re hiring in Canada with a PEO however, you shouldn’t need to worry about learning all this. Rather, your main priority is to ensure that the PEO (or EOR) of your choice is an expert in this subject matter and can navigate local compliance and payroll so that you don’t have to.
Are there any legal implications or considerations when using a Canadian PEO?
One major consideration when it comes to using a PEO in Canada is the differences in provinces. Provinces in Canada may vary slightly in local tax, payroll, and regulatory requirements. Even cultural expectations and language can differ. It’s important to keep this in mind when you’re choosing a PEO, to ensure the organization’s expertise is tailored to the relevant province.
Does a Canadian PEO assist with immigration and work permits for foreign employees?
For the most part Canadian PEOs can’t assist with immigration and work permits. That’s because there are a lot of provisions and restrictions on PEO providers that makes any assistance difficult. However, a good provider will still be able to offer guidance for companies looking into these topics.
How long can you use a PEO in Canada?
There is no limit on employment for the PEO or EOR model in Canada.
With that being said, if you decide to establish your company more fully in Canada, you may want to consider graduating to a more permanent model of employment.