How much does it cost to hire an employee through an EOR in Canada?

EOR pricing typically ranges from $400–$700 per month per employee, plus the employee's base salary and benefits. Beyond the EOR fee, you'll pay: (1) **Base salary**—market rate for the role in Canada. (2) **Employer contributions**—approximately 14% on top of salary for taxes, social insurance, and mandatory benefits. (3) **Optional benefits**—health insurance, bonuses, stock options. For example, hiring a developer earning $3,000/month would cost approximately $3,000 + (14% = $420) + $500 EOR fee = $3920/month total.

Is using an EOR legally safe in Canada?

Yes, using an EOR in Canada is fully legal and compliant when you work with established providers like Deel, Remote, or Oyster. These providers are registered employers in Canada and handle all legal obligations. Canada has a federal system where employment standards vary by province (Ontario, BC, Alberta, Quebec, etc.). Federal employees follow Canada Labour Code, provincial employees follow provincial standards. Tax rates and benefits vary significantly. Hiring in Canada requires understanding the specific province. EOR providers maintain registrations in major provinces and ensure correct compliance. The EOR assumes the legal employer role, so you avoid misclassification risks that come with contractor arrangements. However, choose reputable EOR providers with proven track records in Canada—smaller or unregistered providers carry significant risk.

How long does it take to onboard an employee through an EOR in Canada?

With an EOR, the typical timeline is 10 days from offer acceptance to the employee's first paycheck. The process includes: (1) **Days 1–2**: Background checks and document verification. (2) **Days 3–5**: Employment contract in local language, tax registration. (3) **Days 6–10**: Payroll setup, benefits enrollment, system access. This is dramatically faster than hiring via a subsidiary (which typically takes 2–3 months), making EOR ideal for time-sensitive hiring.

Should I use an EOR or set up a legal subsidiary in Canada?

Use an **EOR** if you're: hiring your first employee in Canada, want to avoid legal complexity and ongoing compliance costs, or plan to hire fewer than 5 people. EORs typically cost $400–$700/month per employee and offer simple, predictable pricing with zero additional administrative burden. Use a **subsidiary** if you're: planning to hire 10+ people in Canada, want direct control over hiring and contracts, or are already established in the country. Setting up a subsidiary takes 2–3 months and costs $2,000–$10,000 in legal and accounting fees, but gives you flexibility and lower per-employee costs long-term. For most small companies hiring their first international team, EOR is the faster, safer choice.

Which EOR providers support hiring in Canada?

The major EOR providers supporting Canada are: **Deel** (150+ countries), **Remote** (80+ countries), **Oyster** (130+ countries), **Rippling** (50+ countries), and **Multiplier** (150+ countries). Each offers similar core features—payroll, compliance, tax handling—with varying prices, customer support, and platform quality. Compare based on: (1) **Price**: $400–$700/month, (2) **Support quality**: Check reviews for your timezone, (3) **Feature set**: Some offer built-in benefits, others are payroll-only, (4) **User experience**: Platform simplicity varies significantly.

What happens to my EOR employee if I stop using the EOR service?

If you decide to leave an EOR service, your options depend on your long-term plan: (1) **Switch to another EOR**: The employee transitions to a new EOR provider within days—no job loss. (2) **Set up a local subsidiary**: The employee becomes employed by your subsidiary. Most EOR providers can help facilitate this transition. (3) **Separate from the employee**: You can terminate the employment agreement with notice (typically 30–60 days in Canada), following all local severance requirements. Because the EOR is the legal employer, any transitions or terminations must comply with Canada's labor laws—another reason to use established, licensed EOR providers.

Employer of Record in Canada

Q: What are the mandatory benefits I need to provide to employees in Canada?

Canada requires employers to provide several mandatory benefits: - **CPP (Pension)**: Employer contributes 5.95% to Canadian Pension Plan. - **EI (Insurance)**: Employer contributes 1.66% to Employment Insurance. - **Paid Time Off**: Minimum 2 weeks paid vacation per year. Varies by province. - **Statutory Holidays**: 9-11 statutory holidays depending on province. - **Parental Leave**: Job protection for up to 18 months (paid via EI). These benefits are built into the EOR fee and handled automatically by your EOR provider. You don't need to manage them separately—just pay the total monthly fee and the EOR handles all compliance.

Onboarding Time

10 days

Employer Contributions

14%

EOR Providers

Currency

Canadian Dollar (CAD)

Employer Cost Breakdown in Canada

14%

$700

Monthly cost on $5k salary

~$500

Typical EOR fee/mo

10d

Onboarding time

Canada offers access to high-quality tech talent, excellent political stability, and cultural similarity to the US. Major tech hubs include Toronto (Shopify headquarters, growing fintech, 900+ tech companies), Vancouver (AI and gaming hub, 1,200+ tech companies), and Montreal (AI research, biotech, thriving startup scene). Canadian developers are skilled, English-fluent (with French proficiency valuable in Quebec), and culturally aligned with North American business practices. Hiring in Canada keeps work within North America (no timezone challenges like Asia) and provides access to talent with US-standard salaries but slightly lower than US rates. However, Canada's employment landscape is notoriously complex due to its federal system. Employment standards differ significantly across 10 provinces and 3 territories. Minimum vacation requirements vary: Ontario/BC minimum 2 weeks, some provinces 3 weeks after specific tenure. Statutory holidays range from 9-11 depending on province. Overtime thresholds differ: Ontario is 44 hours/week, BC is 40 hours/week, and some provinces have daily overtime (e.g., over 8 hours in a day counts as overtime). Tax rates vary dramatically: federal income tax (15-33%) plus provincial tax (ranging from 5% in Alberta to 26% in Quebec). Additionally, Quebec has unique bilingual requirements—employment contracts must be in French or provided in French with certified English translation. Quebec also has different labor laws, such as unique parental leave nomenclature ("congé de parentalité"). Using an EOR in Canada eliminates this complexity. The EOR registers in the relevant province, handles CPP (Canada Pension Plan, 5.95% employer) and EI (Employment Insurance, 1.66% employer) enrollment, ensures provincial labor law compliance, manages correct overtime calculations, handles provincial payroll tax withholding, and manages Quebec bilingual contracts if hiring there. Onboarding takes 10 days. You pay the EOR fee ($400-$600/month) plus salary and approximately 14-16% total employer contributions (CPP 5.95%, EI 1.66%, provincial health tax 1-1.5%, plus provincial variations). The benefit is accessing Canadian talent without managing complex provincial compliance variations yourself.

EOR Providers for Canada

Compare the leading Employer of Record providers for hiring in Canada. All prices are monthly and exclude employee salary and benefits.

Provider	Monthly Fee	Coverage	Best For	Key Features	Action
Deel	$599	150+	Companies scaling globally	Fast onboardingBuilt-in compliance	Get Quote
Remote	$599	80+	Mid-size companies	Own legal entitiesBenefits management	Get Quote
Oyster	$599	130+	Remote-first companies	Guided hiringLocal benefits	Get Quote
Rippling	$600	50+	Tech companies	Unified HR platformIT management	Get Quote
Multiplier	$400	150+	Cost-conscious companies	Competitive pricingMulti-currency payroll	Get Quote

Tip: Most EOR providers offer a free trial or demo. Contact multiple providers to compare features, customer support quality, and specific support for Canada. Pricing and coverage may change after 2026.

Legal Requirements in Canada

Business Number registration with CRA (Canada Revenue Agency)

Provincial payroll account registration

CPP (Canada Pension Plan) and EI (Employment Insurance) enrollment

Provincial labor law compliance

Workers compensation coverage (varies by province)

Mandatory Benefits

Benefit	Description
CPP (Pension)	Employer contributes 5.95% to Canadian Pension Plan.
EI (Insurance)	Employer contributes 1.66% to Employment Insurance.
Paid Time Off	Minimum 2 weeks paid vacation per year. Varies by province.
Statutory Holidays	9-11 statutory holidays depending on province.
Parental Leave	Job protection for up to 18 months (paid via EI).

Compliance Guide

**Employment Contract**: Contracts must comply with the relevant province's employment standards. In Quebec, contracts must be in French or provided with certified French translation. Key terms: job title, duties, salary (hourly or salary), benefits, work schedule (typically 40 hours/week), vacation entitlement, overtime provisions, termination notice, and provincial jurisdiction. Different provinces have different standard contract requirements—the EOR ensures compliance with the specific province. **CPP and EI Registration**: Employers must register with CRA (Canada Revenue Agency) for CPP (Canada Pension Plan) and EI (Employment Insurance). CPP contribution: 5.95% employer (employee contributes same, max contribution ~$3,867/year in 2024). EI contribution: 1.66% employer (employee contributes less, ~$1,049/year max). Provincial health tax varies: Ontario 1.95%, BC 0% (no health tax), Alberta 0%, Quebec included in income tax. These are withheld monthly and remitted to CRA. **Income Tax Withholding**: Progressive federal income tax (15%-33%) plus provincial tax. Example: A developer earning CAD 75,000 in Ontario pays federal (~11,000) + provincial (~5,500) + CPP (~4,300) + EI (~1,200) = approximately CAD 21,000 in total deductions. Tax rates vary significantly by province: Alberta has the lowest marginal rate (15%), Quebec the highest (26% plus contributions). The EOR handles all calculations based on province. **CPP and EI Details**: CPP provides retirement, disability, and survivor benefits. EI provides income replacement if laid off (approx 55% of regular earnings for up to 26-50 weeks depending on tenure and provincial rates). EI also covers parental, maternity, and sickness benefits. **Vacation (Paid Time Off)**: Minimum 2 weeks (10 working days) per year in most provinces. Ontario allows carryover of unused vacation to 2 weeks. Quebec requires 3% of gross salary as annual vacation or 3 weeks after 5 years of service. Unused vacation must be paid out at termination. Some provinces require vacation to be taken within the year. **Statutory Holidays**: 9-11 statutory holidays depending on province (Canada Day, Boxing Day, Thanksgiving, Civic Holiday, etc.). Employees are paid regular wages for holidays not worked. Some provinces (Ontario, BC) allow employers to require work on statutory holidays with premium pay (1.5x to 2x). **Overtime**: Threshold varies significantly by province. Ontario: 44 hours/week = overtime (1.5x). BC: 40 hours/week = overtime. Alberta: 40 hours/week = overtime. Quebec: 40 hours/week = overtime. Daily overtime varies: BC has daily overtime over 10 hours, Ontario over 8 hours. Overtime is typically 1.5x regular rate, double-time may apply to specific situations. The EOR tracks hours and calculates correctly per province. **Parental Leave**: Up to 18 months with job protection in most provinces. Income is partially replaced via EI (approximately 55% of regular earnings for up to 12-18 weeks federally, plus provincial extensions). Quebec allows longer combined parental leave and uses different nomenclature ("congé de parentalité"). **Termination and Severance**: Notice periods for termination without cause vary by province and tenure. Ontario: 2 weeks notice or pay in lieu. BC: 2 weeks if less than 2 years tenure, 4 weeks if 2+ years. Alberta: 2 weeks to 8 weeks depending on tenure. Severance may be required for longer-tenured employees (Ontario: 2 weeks pay per year of service after 2 years). Just cause termination allows dismissal without notice or severance. **Workers Compensation**: Most provinces require employers to register with the provincial Workers' Compensation Board and maintain coverage. Rates vary by industry (tech typically 0.5-1.2%). This covers workplace injuries and provides income replacement and medical benefits. Coverage is mandatory in most provinces. **Quebec-Specific Compliance**: French is the official language for contracts in Quebec. All employment-related documents should be in French or provided with certified French translation. Quebec has unique labor laws under the Act respecting labour standards (Loi sur les normes du travail). Parental leave terminology differs ("congé parental"), and tax rates are higher. Bilingual management is essential when hiring in Quebec. **Remote Work and Tax Residency**: Provincial compliance depends on where the employee primarily works. If an employee works from home in a specific province, that province's laws apply. Tax residency is based on the province where the employee resides. The EOR tracks work location and applies correct provincial regulations.

Why Use an EOR in Canada?

Canada offers political stability, mature tech ecosystems (especially Toronto, Vancouver, Montreal), and access to senior North American talent. However, Canada's federal system means employment law varies significantly by province: CPP (5.95% employer), EI (1.66% employer), vacation minimums (2 weeks typical), statutory holidays (9-11 depending on province), and overtime thresholds differ. Quebec has unique bilingual requirements (French contracts mandatory) and different labor laws. Income tax varies by province from 25-50% depending on income. An EOR eliminates provincial compliance complexity, ensures correct CPP/EI enrollment, handles provincial registration, and manages Quebec bilingual requirements if hiring there. Onboarding takes 10 days. You pay the EOR fee ($400-$600/month) plus salary and approximately 14-16% employer contributions. The benefit is hiring Canadian talent without managing provincial variations yourself.

Other EOR Options in North-america

United States of America

Onboarding: 5 days

15% contributions→

Hiring in Canada: FAQs

An Employer of Record (EOR) is a third-party company that becomes the legal employer of your remote workers in Canada. You define the role, manage the day-to-day work, and set the compensation. The EOR handles all employer responsibilities: payroll, benefits, tax compliance, employment contracts, and labor law compliance. This means you can hire full-time employees in Canada without establishing a subsidiary or legal entity. The process typically takes 10 days from offer to first paycheck.

Start hiring talent in Canada

Deel handles payroll, compliance, and benefits. No local entity needed.

Hire with Deel