Employer of record in Canada: cost and rules (2026)

Employing someone in Canada (Ontario) costs the employer about 7.4% on top of gross salary in statutory contributions, plus an EOR fee of $199 to $699 per month at providers that publish prices ("from" prices). Example: a gross salary of CAD 7,000 per month costs CAD 7,515 per month (about $5,271) before any EOR fee.

Rates checked: 2026-11-14. Employer costs in Canada depend on the province, and this page models Ontario, the most common province for hiring. The employer pays its share of Canada Pension Plan contributions (a base plan plus a second tier on higher pay) and Employment Insurance premiums, each stopping at an annual earnings ceiling. Ontario's Employer Health Tax does not apply to a small payroll. Workplace injury insurance is compulsory for many industries but not for all, so it is shown as optional here. There is no mandatory 13th salary. Paid vacation and public holidays are set by provincial law. Estimates only, not advice: see the note at the bottom of the page.

Employer contributions in Canada

Minimum wage: CAD 3,111 per month. Ontario general minimum wage is CAD 17.95 per hour from 1 October 2026 (CAD 17.60 until 30 September 2026). The monthly figure is our estimate for a 40-hour week (17.95 x 40 x 52 / 12 = CAD 3,111.33). Other provinces set their own rates, and some Ontario jobs have different rates. Source: Ontario.ca, Your guide to the Employment Standards Act: Minimum wage

Worked example: CAD 7,000 gross per month

Optional items are not in the total: CAD 86 per month.

Contractor, EOR or own entity in Canada

Contractor

The Canada Revenue Agency decides whether a worker is an employee or self-employed by looking at the whole relationship, such as control over the work, tools, chance of profit and risk of loss. If a contractor is really an employee, the payer may owe unpaid CPP, EI and tax, plus penalties. A genuine contractor pays their own tax and both halves of CPP. The worker or the payer can ask the CRA for a ruling. Source: CRA, Determining employment status

Own entity

A federal corporation can be incorporated online with Corporations Canada for CAD 200, usually within one business day. Before paying staff you must also register a payroll account with the Canada Revenue Agency. Register for Ontario Employer Health Tax (Ministry of Finance) and with the WSIB, where they apply. Source: Corporations Canada, Services, fees and processing times

Leave, notice, probation and termination

Annual leave: 10 days. Ontario law gives two weeks of vacation time (10 working days for a five-day week). Vacation pay is at least 4% of wages in the first 5 years. After 5 years it rises to three weeks and at least 6%. Other provinces have their own rules.

Public holidays: 9. Ontario has nine public holidays: New Year's Day, Family Day, Good Friday, Victoria Day, Canada Day, Labour Day, Thanksgiving Day, Christmas Day and Boxing Day. Qualifying employees get the day off with pay, or agree to work it for premium pay or a substitute day. Source: Ontario.ca, Employment Standards Act guide: Vacation and Public holidays

Notice

After 3 months of continuous work, Ontario employees are owed written notice or pay instead of notice: 1 week under 1 year; 2 weeks for 1 to 3 years; then 1 extra week per year of service (3 years = 3 weeks), up to 8 weeks at 8 years. A contract may give more, and courts often award longer common-law notice for senior staff. Source: Ontario.ca, ESA guide: Termination of employment

Probation

Ontario has no legal probation period. In the first 3 months of employment the employer owes no statutory notice or termination pay, which is why many contracts use a 3-month trial. Other protections, such as human-rights rules, still apply from day one. Source: Ontario.ca, ESA guide: Termination of employment

Termination

Besides notice, an employee with 5 or more years of service may be owed severance pay. This applies if the employer's payroll worldwide is CAD 2.5 million or more, or if 50 or more employees lose their jobs within six months because all or part of the business closes for good. Severance is one week of regular wages per year of service, up to 26 weeks. Source: Ontario.ca, ESA guide: Severance pay

What the calculator simplifies

• Costs differ by province. This page models Ontario. Quebec has its own pension plan (QPP), lower EI rates and extra payroll levies, and other provinces have their own payroll taxes and workplace insurance.
• Ontario Employer Health Tax (EHT) is not added. Eligible employers with an Ontario payroll under CAD 1 million pay no EHT, which should cover a single hire. The exemption is shared across associated companies and is not available if the group's payroll is above CAD 5 million. The rate starts at 0.98% on the first CAD 200,000 of pay. A foreign employer with no Ontario permanent establishment should confirm with the Ministry of Finance whether it has to register.
• Workplace injury insurance (WSIB) is shown as optional at the all-industry average rate. It is compulsory for many industries. The real rate depends on the industry class, and some office-based businesses are not required to be covered.
• Vacation pay (4%) and public holiday pay are part of ordinary pay, so no extra cost is added. If your salary figure excludes them, add about 4% for vacation pay.
• Employer-paid health, dental and other benefits are not required by law and are not included. Statutory leave pay such as maternity or sick-day top-ups is also not included.
• Employees under 18 or over 70 do not pay into CPP, and employer premium reductions (for example the EI reduction for approved wage-loss plans) are not modelled.
• The monthly minimum wage is an estimate for a 40-hour week.

EOR provider prices

Prices are "from" (starting) prices as shown on each provider's own page, usually per employee per month. What you pay can be higher and depends on country, headcount and contract length. Sorted by price, lowest first; providers that publish no price come last.

Affiliate disclosure: we may join providers' affiliate programmes, so links may become affiliate links. Right now the site has no affiliate links. Order is by published price; ties are listed alphabetically. Read the disclosure.

Calculator for Canada

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FAQ

How much does it cost to employ someone in Canada (Ontario)?

On top of gross salary, statutory contributions and mandatory accruals add about 7.4% at a gross salary of CAD 7,000 per month. That is a total of CAD 7,515 per month before any EOR fee.

How much does an employer of record cost in Canada?

Providers that publish a price list charge $199 to $699 per month for EOR plans ("from" prices, checked 2026-11-14). This is on top of salary and the statutory employer costs above. Source

How much paid leave do employees get in Canada?

Annual leave is 10 days, plus 9 public holidays. Ontario law gives two weeks of vacation time (10 working days for a five-day week). Source

What is the notice period in Canada?

After 3 months of continuous work, Ontario employees are owed written notice or pay instead of notice: 1 week under 1 year; 2 weeks for 1 to 3 years; then 1 extra week per year of service (3 years = 3 weeks), up to 8 weeks at 8 years. A contract may give more, and courts often award longer common-law notice for senior staff. Source

Is there a probation period in Canada?

Ontario has no legal probation period. In the first 3 months of employment the employer owes no statutory notice or termination pay, which is why many contracts use a 3-month trial. Other protections, such as human-rights rules, still apply from day one. Source

What are the rules on ending employment in Canada?

Besides notice, an employee with 5 or more years of service may be owed severance pay. This applies if the employer's payroll worldwide is CAD 2.5 million or more, or if 50 or more employees lose their jobs within six months because all or part of the business closes for good. Severance is one week of regular wages per year of service, up to 26 weeks. Source

Sources

Rates checked: 2026-11-14.

• Ontario.ca, Your guide to the Employment Standards Act: Minimum wage
• Canada Revenue Agency, CPP contribution rates, maximums and exemptions
• Canada Revenue Agency, CPP2 rates and maximums
• Canada Revenue Agency, EI premium rates and maximums
• WSIB Ontario, 2026 premium rates
• Ontario.ca, Employment Standards Act guide: Vacation and Public holidays
• Ontario.ca, ESA guide: Termination of employment
• Ontario.ca, ESA guide: Severance pay
• CRA, Determining employment status
• Corporations Canada, Services, fees and processing times