Determining province of employment

Not always the simple task it may seem
By Rachel De Grâce
|Canadian Payroll Reporter|Last Updated: 09/01/2011

Determining the province of employment of employees may seem a rather simple task; yet, it can be one of the most complex areas of payroll administration.

In actual fact payroll is a profession based on legislative compliance where organizations need to ensure they are compliant with more than 191 federal and provincial regulatory requirements that govern the payroll function. The Canadian Payroll Association (CPA) recently launched its third set of guidelines about the requirements surrounding the province of employment as a reference tool to assist payroll practitioners in determining employees’ province of employment in order to carry out their responsibilities and ensure compliance for their organization.

Employees are set up in an organization’s payroll based on their province of employment, which then dictates the tax rates, source deductions, and year-end reporting that must be applied by law. However, an employee’s province of employment may be different from the province of residence, and different still from the province under which this employee is covered for employment/labour standards, pension legislation and workers’ compensation.