FreelanXCountryUSUnited StatesCACanada
North America · 2 countries
Country guideNorth AmericaVerified Oct 2026
US
Hiring in United States: the 2026 guide
This guide covers federal US rules for employing staff and engaging contractors. Employment law is set at federal, state and sometimes city level, and states differ a lot. FreelanX EOR employment is typically set per state, so confirm the work state first.
14 min read Verified Oct 2026 General information, not legal advice
Capital · Currency
Washington, D.C. · USDLanguage
EnglishMinimum wage
$7.25 per hour federal; many states higher (California $16.90, New York $16.00 to $17.00 in 2026)Employer contributions
About 8% to 12% of gross pay (FICA 7.65%, FUTA, state unemployment, workers' comp), before health benefitsStatutory paid leave
No federal paid leave; PTO set by contract or state lawPublic holidays
11 federal holidays (private employers need not give them)Employer notice
None by law (at-will); contract or policy may set noticeFreelanX EOR onboarding
2–10 daysCountry guideNorth AmericaVerified Oct 2026
CA
Hiring in Canada: the 2026 guide
Canada has no single employment law. The Canada Labour Code covers only federally regulated employers (banks, telecoms, airlines, interprovincial transport). Provincial standards apply to most employers. Ontario is the worked example, with notes on Quebec, BC and Alberta.
14 min read Verified Oct 2026 General information, not legal advice
Capital · Currency
Ottawa · CADLanguage
English and FrenchMinimum wage
Ontario C$17.95 per hour from 1 Oct 2026 (C$17.60 before); federal C$18.15 from 1 Apr 2026; other provinces differEmployer contributions
About 6 to 9% of gross for a professional salary (CPP, CPP2, EI, plus WSIB and possibly EHT in Ontario)Statutory paid leave
Ontario: 2 weeks after 1 year, 3 weeks after 5 years (federal and some provinces differ)Public holidays
Ontario 9 public holidays; federal 9; Quebec 8; BC 11; Alberta 9Employer notice
Ontario ESA: 1 week per year of service up to 8 weeks, plus severance pay in some cases; common-law notice is often longerFreelanX EOR onboarding
2–10 daysHire in United States, start to finish
FreelanX EOR is the legal employer in United States. We issue the contract, run payroll and declarations, and you manage the work day to day.
1Request
Tell us the role, salary and start date.
2Contract
United States employment contract and written terms prepared.
3Registrations
Tax, social security and insurance registrations.
4Start date
Your collaborator starts, on payroll from day one.
2–10 days in totalfor North America with FreelanX EOR. The exact time depends on how fast documents arrive.
At-will employment
Outside Montana, either side can end the job at any time without notice or cause, unless a contract or law limits it.
State law decides much
Minimum wage, paid sick leave, final pay timing, noncompetes and unemployment tax all vary by state and sometimes by city.
Exempt vs non-exempt
Non-exempt staff get overtime at 1.5x over 40 hours a week. Exempt status needs a salary test and a duties test.
Payroll taxes
Employer pays 6.2% Social Security (to $184,500 in 2026), 1.45% Medicare, FUTA and state unemployment tax.
No statutory severance
Severance is not required by federal law. WARN Act gives 60 days notice for large layoffs at employers with 100 or more staff.
Right to work check
Every employee needs a Form I-9 completed within 3 business days of starting, with original identity and work documents.
Five mistakes to avoid
The ones we see most often when a team hires in United States for the first time.
Misclassifying contractors
Several tests apply (IRS, DOL, state ABC tests). A worker who is a contractor under one test can be an employee under another.
FLSA 29 U.S.C. 201 et seq.; IRC s.3509; Cal. Lab. Code s.2775Treating salaried staff as exempt by default
A salary alone does not make an employee exempt. The duties test must also be met, and some states set higher salary floors.
29 CFR Part 541Using one state's rules everywhere
Final pay deadlines, sick leave accrual, break rules and noncompetes depend on the work state. Remote staff follow their own state.
State labour codesIgnoring state unemployment and paid leave registrations
Each work state needs payroll tax accounts, and several run paid family leave programs with their own contributions.
State UI and PFML statutesUnenforceable or banned noncompetes
California, Minnesota, North Dakota and Oklahoma largely void employee noncompetes. Other states cap them by pay or duration.
Cal. Bus. & Prof. Code s.16600; Minn. Stat. s.181.988Contract rules that matter
Form of contractWritten contract is not required by federal law. Most hires use an offer letter. Several states require written notice of pay terms at hire (for example New York, California).NY Lab. Law s.195; Cal. Lab. Code s.2810.5
ProbationNo legal probation period. Many employers use an informal 90-day period. At-will status means no notice is needed in that period either.At-will doctrine (state common law)
Fixed-term contractsAllowed. Ending early without cause may create contract damages. There is no federal cap on duration or renewals.State contract law
Notice of termsNo federal rule. Some states require pay rate, pay day and employer details in writing at hire.NY Lab. Law s.195(1); Cal. Lab. Code s.2810.5
Non-competeFTC ban was set aside by a court in 2024 and the FTC dropped its appeal in 2025. State law governs: banned or limited in California, Minnesota, North Dakota, Oklahoma, others cap by pay.Ryan LLC v. FTC (N.D. Tex. 2024); state statutes
Collective agreementsUnion coverage is low in the private sector (about 6%). Where a union exists, the agreement can set pay and discipline rules.National Labor Relations Act, 29 U.S.C. 151 et seq.
Confidentiality and IPAllowed. Federal whistleblower carve-outs apply, and some states limit invention assignment clauses.18 U.S.C. 1833(b); Cal. Lab. Code s.2870
Anti-discriminationTitle VII, ADA and ADEA apply from 15 or 20 employees. Many states and cities cover smaller employers and add protected traits.42 U.S.C. 2000e; 42 U.S.C. 12101; 29 U.S.C. 621
Employer cost simulator
Pick a salary. Figures use the current rates and ceilings for a standard professional salary. Estimates, not a quote.
Gross yearly salary (USD)
Employer share of statutory contributions
$4,590
7.6% of gross salary
Estimated total employer cost
$65,112 – $66,732
Gross salary + contributions + other employer costs ($522 to $2,142)
Social Security (OASDI)
Employer share of FICA, on wages up to the 2026 base.
$3,720Medicare (HI)
No wage cap. The 0.9% additional Medicare tax is paid by the employee only.
$870Employer share of statutory contributions
$6,885
7.6% of gross salary
Estimated total employer cost
$97,647 – $100,077
Gross salary + contributions + other employer costs ($762 to $3,192)
Social Security (OASDI)
Employer share of FICA, on wages up to the 2026 base.
$5,580Medicare (HI)
No wage cap. The 0.9% additional Medicare tax is paid by the employee only.
$1,305Employer share of statutory contributions
$9,180
7.6% of gross salary
Estimated total employer cost
$130,182 – $133,422
Gross salary + contributions + other employer costs ($1,002 to $4,242)
Social Security (OASDI)
Employer share of FICA, on wages up to the 2026 base.
$7,440Medicare (HI)
No wage cap. The 0.9% additional Medicare tax is paid by the employee only.
$1,740Employer share of statutory contributions
$11,475
7.6% of gross salary
Estimated total employer cost
$162,717 – $166,767
Gross salary + contributions + other employer costs ($1,242 to $5,292)
Social Security (OASDI)
Employer share of FICA, on wages up to the 2026 base.
$9,300Medicare (HI)
No wage cap. The 0.9% additional Medicare tax is paid by the employee only.
$2,175Employer share of statutory contributions
$14,339
7.2% of gross salary
Estimated total employer cost
$215,981 – $221,381
Gross salary + contributions + other employer costs ($1,642 to $7,042)
Social Security (OASDI)
Employer share of FICA, on wages up to the 2026 base.
$11,439Medicare (HI)
No wage cap. The 0.9% additional Medicare tax is paid by the employee only.
$2,900State unemployment tax (new employer rates about 1% to 4% on a state wage base, from $7,000 to over $70,000), workers' compensation (about 0.3% to 2% for office roles) and state payroll levies. Health benefits are extra.
Pay and contribution rules
Federal minimum wage$7.25 per hour, unchanged since 2009. About 30 states and many cities set higher rates. California is $16.90 (2026) and New York is $17.00 in NYC, Long Island and Westchester, $16.00 elsewhere.29 U.S.C. 206; Cal. Lab. Code s.1182.12; NY Lab. Law s.652
Overtime and exempt salary levelNon-exempt staff get 1.5x over 40 hours a week. Federal exempt salary floor is $684 per week ($35,568 a year) after the 2024 increase was vacated. California floor is higher (twice state minimum wage).29 CFR 541.600; Texas v. DOL (E.D. Tex. 2024)
13th month or mandatory bonusNone. Bonuses, commissions and profit sharing are by contract. Once promised, earned amounts must be paid under state wage payment laws.State wage payment statutes
Income tax withholdingEmployer withholds federal income tax from Form W-4, plus state and local tax where they apply. Nine states have no wage income tax.IRC s.3402; IRS Pub. 15
FICA, FUTA and state unemploymentEmployer pays 6.2% Social Security on wages up to $184,500, 1.45% Medicare, FUTA 0.6% on the first $7,000 (net of state credit), and SUTA at state rates and wage bases.IRC ss.3111, 3301; SSA 2026 wage base release
Payslips and pay frequencyNo federal payslip rule. Many states require itemised statements and set pay frequency (for example New York, California). Wages go on a regular payday.NY Lab. Law s.195(3); Cal. Lab. Code s.226
Final payNo federal deadline. California requires all wages on the last day when fired, within 72 hours when quitting without notice. Other states allow the next payday.Cal. Lab. Code ss.201-202
Working time
Weekly hoursNo federal maximum for adults. Overtime applies after 40 hours in a workweek for non-exempt staff. Some states add daily overtime (California over 8 hours a day).29 U.S.C. 207; Cal. Lab. Code s.510
Overtime rate1.5x the regular rate. California pays 2x after 12 hours in a day. Comp time in place of overtime is barred for private employers.29 U.S.C. 207(a); Cal. Lab. Code s.510
Meal and rest breaksNo federal break rule. Many states require meal breaks (California 30 minutes after 5 hours; New York 30 minutes for shifts over 6 hours).Cal. Lab. Code s.512; NY Lab. Law s.162
Rest between shiftsNo federal daily or weekly rest rule for adults. A few states require one day of rest in seven (for example California, New York for certain roles).Cal. Lab. Code s.551
Night and Sunday workNo federal premium for night, weekend or holiday work. Premiums come from contracts or state law.FLSA (no premium requirement)
Time recordingEmployers must keep records of hours for non-exempt staff for at least 3 years (payroll) and 2 years (time cards).29 CFR 516.5, 516.6
Leave and absences
Annual leaveNo federal paid vacation. Amount is set by contract or policy. Some states (for example California) treat accrued vacation as wages that must be paid at exit.FLSA (silent); Cal. Lab. Code s.227.3
Paid sick leaveNo federal law. About 18 states and many cities require paid sick leave, typically 24 to 56 hours a year. California requires 40 hours or 5 days; New York 40 or 56 hours by employer size.Cal. Lab. Code s.246; NY Lab. Law s.196-b
Family and medical leaveFMLA gives up to 12 weeks unpaid, job-protected leave a year at employers with 50 or more staff within 75 miles, after 12 months and 1,250 hours. Several states run paid programs.29 U.S.C. 2601 et seq.
Paid family leave (state)About 13 states and D.C. run paid family and medical leave funded by payroll contributions. Examples: California (up to 8 weeks), New York (12 weeks).Cal. Unemp. Ins. Code s.3301; NY Workers' Comp. Law art. 9
Maternity and parental leaveNo federal paid maternity or paternity leave. FMLA unpaid leave and state programs apply. Pregnant workers have accommodation rights.29 U.S.C. 2612; 42 U.S.C. 2000gg
Statutory minimum paid leave, in weeks
How United States compares with the other markets in this guide, for a 5-day week. Each country has its own verified figure.
United States0 weeks
Canada2 weeks
Public holidays 2026
National days plus regional days. Hover a dot to see its name.
JFMAMJJASOND
Thu 1 JanNational
New Year's DayMon 19 JanNational
Martin Luther King Jr. DayMon 16 FebNational
Washington's Birthday (Presidents Day)Mon 25 MayNational
Memorial DayFri 19 JunNational
Juneteenth National Independence DayFri 3 JulNational
Independence Day (observed)Mon 7 SepNational
Labor DayMon 12 OctNational
Columbus Day (Indigenous Peoples' Day in some states)Wed 11 NovNational
Veterans DayThu 26 NovNational
Thanksgiving DayFri 25 DecNational
Christmas DayThese are federal holidays. Private employers are not required to give them off or pay for them. July 4 falls on a Saturday, so the federal observed day is Friday July 3. State holidays differ.
Notice periods set by the employer
Hover a row. Bars are drawn to scale.
Any tenure (at-will)No statutory notice
Contract or policyTwo weeks is common practice, not law
Senior roles by contractOften 30 days by contract
Executives by contractOften 60 to 90 days or severance in lieu
Mass layoff (WARN)60 calendar days for covered layoffs
Employee notice is also by contract. Montana requires good cause after a probationary period. Some states and cities add notice for layoffs (mini-WARN laws, for example New York 90 days). Written notice is advised.
Rules for ending an employment
Form and groundsAt-will: no reason is needed, but dismissal must not be discriminatory, retaliatory or in breach of contract or public policy. Most states recognise exceptions.Title VII; state common law
ProcedureNo federal procedure. Written notice and documentation are best practice. Some states set final pay and notice-of-separation duties.Cal. Lab. Code s.201; NY Lab. Law s.195(6)
SeveranceNone by statute. Common practice is one to two weeks per year of service, often tied to a release of claims. Releases for workers over 40 need 21 days to consider and 7 days to revoke.OWBPA, 29 U.S.C. 626(f)
Mass layoff (WARN)Covers employers with 100 or more staff. 60 days notice for a plant closing or mass layoff (50 or more at a site). Back pay for up to 60 days if breached.29 U.S.C. 2101-2109
Protected classesDismissal for protected traits, leave use, whistleblowing or union activity is unlawful. Employees over 40 have specific age claims.Title VII; ADEA; FMLA; NLRA
Unemployment benefitsDismissed staff may claim state unemployment insurance unless fired for misconduct. Employer experience rating can rise.State unemployment insurance statutes
With FreelanX EOR, ending an employment is run by FreelanX EOR under local law, and the process is agreed with you before any step.
Six signals checked by the authorities
No single signal decides. Authorities and courts weigh the whole picture and look at how the work is really done, not only at the contract.
Source for the criteria: IRS common-law test (Rev. Rul. 87-41); FLSA economic reality test (DOL 2024 rule not enforced, replacement proposed Feb 2026); California ABC test, Dynamex (2018) and Lab. Code s.2775. Confirm with a local lawyer for a specific case.
Getting certainty on the status
How to check the status in advance, or what happens in an audit.
1Choose the right test
Check the IRS test for tax, the FLSA test for wages and the state test (ABC in California, New Jersey, Massachusetts and others) for the work state.
2Contract and facts
Use a written services agreement, but conduct matters more than labels. Document deliverables, independence, and the contractor's other clients.
3Request an IRS determination
Form SS-8 asks the IRS for a worker status ruling. It can take 6 months or more and is not binding on state agencies.
4Collect the paperwork
Get Form W-9 from US contractors, file 1099-NEC for payments of $2,000 or more made in 2026 (up from $600 under the 2025 tax law; indexed for inflation from 2027), and use W-8BEN for non-US persons.
The federal threshold for 1099-NEC changes to $2,000 for payments after 2025 under the 2025 tax law. Confirm with a tax adviser. State filings may still use lower thresholds.
What a reclassification can cost
Back-payment of contributions, penalties and, in some countries, personal liability.
Back taxes
IRS can assess employer FICA, withholding and penalties. Section 3509 gives reduced rates for non-wilful cases. Wilful cases face full liability and trust fund penalties.
IRC ss.3509, 6672
Wage claims
FLSA back overtime and minimum wage, plus equal liquidated damages. Limit is 2 years, or 3 years if wilful.
29 U.S.C. 216(b), 255
State penalties
California civil penalties for wilful misclassification are $5,000 to $25,000 per violation. Unpaid UI, workers' comp and paid leave contributions also apply.
Cal. Lab. Code s.226.8
Benefit plan and coverage
Reclassified staff may claim benefits, ACA coverage and workers' comp. Employers with 50 or more full-time equivalents face ACA penalties.
IRC s.4980H
Contractor tax and status basics
Self-employment taxUS contractors pay 15.3% self-employment tax (Social Security and Medicare) and file quarterly estimated tax. Client does not withhold.IRC s.1401
ReportingClient files Form 1099-NEC by January 31 for the prior year. No filing is needed for payments to corporations in most cases.IRC s.6041A; Treas. Reg. 1.6041-3
Non-US contractorsForeign contractors working outside the US generally have no US withholding. Collect Form W-8BEN. US-source services may face 30% withholding.IRC ss.861, 1441
Work with independents in United States, with the paperwork handled
FreelanX Contractors: from $19 per month. Contractor of record from $279.
Work permits: key figures
Where a figure is from a past year, the text says so.
$100,000
H-1B fee proclamation (Sept 2025)Applies to new petitions for workers outside the US. Courts blocked collection in 2026 and an appeal is pending; status can change.
85,000
H-1B annual cap65,000 regular plus 20,000 US master's cap. Selection by lottery, with a wage-weighted system adopted for later cap seasons.
Work permits in practice
H-1B (specialty occupation)Bachelor's degree role, employer petition, labour condition application. Up to 3+3 years. Cap-subject, lottery in March, start October 1.INA s.101(a)(15)(H); 8 CFR 214.2(h)
H-1B $100,000 feeProclamation of Sept 19, 2025, extended in 2026. A Massachusetts court vacated it on June 8, 2026 and the First Circuit left that ruling in place on July 24, 2026. Appeal pending, so check before filing.Presidential Proclamation (Sept 2025); court orders
L-1 (intracompany transferee)For managers, executives (L-1A, up to 7 years) and specialised staff (L-1B, 5 years) with 1 year abroad in a related entity. No cap.INA s.101(a)(15)(L); 8 CFR 214.2(l)
O-1 (extraordinary ability)For sustained acclaim in science, business, arts or athletics. Initial 3 years, renewable. No cap. Needs evidence and an advisory opinion.INA s.101(a)(15)(O); 8 CFR 214.2(o)
TN (USMCA professionals)Canadian and Mexican citizens in listed professions, such as engineer or accountant. Up to 3 years, renewable. No cap.USMCA Ch.16 Appendix 1; 8 CFR 214.6
Green card pathsEmployment-based categories (EB-1 to EB-3) usually need PERM labour certification, with long backlogs for India and China.INA s.203(b)
Employer dutiesComplete Form I-9 within 3 business days of hire, verify work authorisation, and consider E-Verify (mandatory in some states).8 U.S.C. 1324a; 8 CFR 274a.2
DependantsH-4 and L-2 spouses may work in some cases (L-2 spouses automatically). H-4 work needs an approved I-140 case.8 CFR 274a.12
Visa policy changed often in 2025 and 2026. Check current USCIS guidance and court status before filing. EOR cannot sponsor most work visas for a non-US staff member without a US entity.
Main sources
The law or official source behind each key point, as of October 2026.
TopicSource
At-will employmentState common law; Montana WDEA
Federal minimum wage $7.2529 U.S.C. 206
California and New York 2026 minimum wageState labour agencies
FLSA exempt salary threshold ($684 weekly)29 CFR 541; Texas v. DOL
2026 Social Security wage base $184,500SSA announcement
FUTA 0.6% on $7,000IRC s.3301
WARN Act 60 days29 U.S.C. 2102
DOL contractor rule status 2026Mayer Brown, Mar 2026 (proposal Feb 2026)
H-1B $100,000 fee statusUniv. of Colorado ISSS, Oct 7 2026
Federal holidays 2026OPM list
Paid sick leave state countsPayroll guides
1099-NEC threshold $2,0002025 tax law
FTC noncompete rule statusRyan LLC v. FTC
General information, updated monthly. It is not legal advice: for a decision, talk to us or to your counsel.
What to watch
Rules that are changing, or that vary by region or sector.
- 2026 minimum wages: California $16.90; New York $17.00 in NYC, Long Island and Westchester and $16.00 elsewhere. Many cities and counties set higher local rates.
- H-1B $100,000 fee: a federal court struck it down on 8 June 2026 and, since a 24 July 2026 appeals court order, USCIS is not collecting it. The proclamation was extended to 21 September 2027 and the government's appeal is pending, so check the status before filing.
- 1099-NEC threshold: $2,000 for payments made in 2026 (was $600), indexed for inflation from 2027.
- Paid sick leave and paid family leave are set by states and some cities, so the rules depend on where the employee works.
Changelog
Oct 2026Guide rebuilt for United States with 2026 figures and sources.United States
Next reviewJanuary 2027, when new yearly rates are published.Planned
Hire in Canada, start to finish
FreelanX EOR is the legal employer in Canada. We issue the contract, run payroll and declarations, and you manage the work day to day.
1Request
Tell us the role, salary and start date.
2Contract
Canada employment contract and written terms prepared.
3Registrations
Tax, social security and insurance registrations.
4Start date
Your collaborator starts, on payroll from day one.
2–10 days in totalfor North America with FreelanX EOR. The exact time depends on how fast documents arrive.
Two legal layers
Federal Canada Labour Code for federally regulated employers only. Provincial employment standards for most employers, based on where the employee works.
Ontario is the example
This guide details Ontario. Quebec, BC and Alberta differ on notice, leave, holidays, contributions and language rules. Check the province of work.
Statutory minimum is not the full cost
ESA notice is a floor. Courts award common-law reasonable notice to most employees, often much more than the statute.
Payroll registration needed
The employer needs a CRA payroll account to withhold income tax, CPP and EI. Quebec also has its own collectors (Revenu Quebec, QPP, QPIP).
Non-competes are banned in Ontario
Since 25 Oct 2021 the ESA bans non-compete agreements, with narrow exceptions (sale of business, executives). Quebec, BC and Alberta use a reasonableness test.
Work authorization is a gate
Non-citizens need a valid work permit. LMIA-based and LMIA-exempt routes exist. 2026 temporary worker targets are lower than 2025.
Five mistakes to avoid
The ones we see most often when a team hires in Canada for the first time.
Applying one law to the whole country
Using Ontario terms for a Quebec or BC employee can breach local minimums. Federal rules apply only to federally regulated employers.
Canada Labour Code Part III; ESA 2000 (Ontario)Weak termination clause
A clause that breaches the ESA in any scenario (for example a broad just-cause definition) can void the whole clause. The employee then claims common-law notice.
Waksdale v Swegon North America Inc., 2020 ONCA 391Contractor misclassification
Calling a full-time, integrated worker a contractor does not avoid ESA, CPP or EI. In Ontario the employer cannot treat an employee as a non-employee.
ESA 2000 s.5.1; McKee v Reid's Heritage Homes, 2009 ONCA 916Using a non-compete in Ontario
A non-compete signed with an Ontario employee is void unless an exception applies. Use confidentiality and non-solicitation clauses instead.
ESA 2000 s.67.2Ignoring Quebec language rules
In Quebec, the employment contract and workplace communications must be available in French. Offer the contract in French first.
Charter of the French Language (Quebec), as amended by Bill 96Contract rules that matter
Form of contractOntario: a written contract is not mandatory but strongly advised. Oral and implied terms bind. A written termination clause is the main protection for the employer.ESA 2000 (Ontario); common law
ProbationNo statutory probation in Ontario. ESA notice and severance do not apply in the first 3 months, but common-law notice can. Federal: unjust dismissal rights start at 12 months.ESA 2000 s.54; Canada Labour Code s.240
Fixed-term contractsAllowed. The end of a fixed term is not a termination under the ESA if the term is properly stated. Repeated renewals may be treated as indefinite employment by courts.O. Reg. 288/01 (Ontario); common law
Information to giveOntario requires a written information sheet on the ESA at hire. Pay periods, wages and hours must be documented. Statutory hiring notices (WSIB, privacy) apply.ESA 2000 (Ontario)
Non-competeBanned in Ontario (since 25 Oct 2021) except in a business sale or for executives. Quebec: valid only if written, limited in time, place and activity. BC and Alberta: courts test reasonableness.ESA 2000 s.67.2; Civil Code of Quebec art. 2089
Collective agreementsUnionised workplaces follow the collective agreement, which can add notice, seniority and grievance rules. Most professional roles in private tech are non-union.Ontario Labour Relations Act, 1995
Quebec languageQuebec contracts must be offered in French, and the employee may then agree to another language. Work tools and documents should be available in French.Charter of the French Language, Bill 96
Job postings (Ontario, 2026)From 1 Jan 2026, Ontario employers with 25 or more employees must state the pay or a pay range (no wider than C$50,000, unless the role pays over C$200,000) in public job postings, disclose AI screening, say whether the vacancy exists, and may not require Canadian experience.Working for Workers Act (Bill 149), ESA 2000
Employer cost simulator
Pick a salary. Figures use the current rates and ceilings for a standard professional salary. Estimates, not a quote.
Gross yearly salary (CAD)
Employer share of statutory contributions
C$4,939
8.2% of gross salary
Estimated total employer cost
C$65,119 – C$66,439
Gross salary + contributions + other employer costs (C$180 to C$1,500)
CPP (base)
2026. Charged on earnings from C$3,500 to the C$74,600 ceiling. Maximum C$4,230.45. Model slightly overstates by the exemption. Quebec uses QPP at 6.30%, maximum about C$4,479.
C$3,570CPP2 (enhanced)
2026. Charged on earnings from C$74,600 to C$85,000. Maximum C$416.
C$0EI
2026. Employer pays 1.4 times the employee rate of 1.63%. Maximum insurable earnings C$68,900. Maximum C$1,572.30. Quebec rate is 1.82% (employee 1.30%) plus QPIP.
C$1,369Employer share of statutory contributions
C$6,227
7.8% of gross salary
Estimated total employer cost
C$86,467 – C$88,227
Gross salary + contributions + other employer costs (C$240 to C$2,000)
CPP (base)
2026. Charged on earnings from C$3,500 to the C$74,600 ceiling. Maximum C$4,230.45. Model slightly overstates by the exemption. Quebec uses QPP at 6.30%, maximum about C$4,479.
C$4,439CPP2 (enhanced)
2026. Charged on earnings from C$74,600 to C$85,000. Maximum C$416.
C$216EI
2026. Employer pays 1.4 times the employee rate of 1.63%. Maximum insurable earnings C$68,900. Maximum C$1,572.30. Quebec rate is 1.82% (employee 1.30%) plus QPIP.
C$1,572Employer share of statutory contributions
C$6,427
6.4% of gross salary
Estimated total employer cost
C$106,727 – C$108,927
Gross salary + contributions + other employer costs (C$300 to C$2,500)
CPP (base)
2026. Charged on earnings from C$3,500 to the C$74,600 ceiling. Maximum C$4,230.45. Model slightly overstates by the exemption. Quebec uses QPP at 6.30%, maximum about C$4,479.
C$4,439CPP2 (enhanced)
2026. Charged on earnings from C$74,600 to C$85,000. Maximum C$416.
C$416EI
2026. Employer pays 1.4 times the employee rate of 1.63%. Maximum insurable earnings C$68,900. Maximum C$1,572.30. Quebec rate is 1.82% (employee 1.30%) plus QPIP.
C$1,572Employer share of statutory contributions
C$6,427
4.9% of gross salary
Estimated total employer cost
C$136,817 – C$139,677
Gross salary + contributions + other employer costs (C$390 to C$3,250)
CPP (base)
2026. Charged on earnings from C$3,500 to the C$74,600 ceiling. Maximum C$4,230.45. Model slightly overstates by the exemption. Quebec uses QPP at 6.30%, maximum about C$4,479.
C$4,439CPP2 (enhanced)
2026. Charged on earnings from C$74,600 to C$85,000. Maximum C$416.
C$416EI
2026. Employer pays 1.4 times the employee rate of 1.63%. Maximum insurable earnings C$68,900. Maximum C$1,572.30. Quebec rate is 1.82% (employee 1.30%) plus QPIP.
C$1,572Employer share of statutory contributions
C$6,427
4.0% of gross salary
Estimated total employer cost
C$166,907 – C$170,427
Gross salary + contributions + other employer costs (C$480 to C$4,000)
CPP (base)
2026. Charged on earnings from C$3,500 to the C$74,600 ceiling. Maximum C$4,230.45. Model slightly overstates by the exemption. Quebec uses QPP at 6.30%, maximum about C$4,479.
C$4,439CPP2 (enhanced)
2026. Charged on earnings from C$74,600 to C$85,000. Maximum C$416.
C$416EI
2026. Employer pays 1.4 times the employee rate of 1.63%. Maximum insurable earnings C$68,900. Maximum C$1,572.30. Quebec rate is 1.82% (employee 1.30%) plus QPIP.
C$1,572Ontario WSIB premium (rate varies by industry class, low for office and software work), Employer Health Tax (0.98% and up, but the first C$1,000,000 of payroll is exempt for most private employers), and Quebec items (QPIP, HSF, CNESST) if applicable.
Pay and contribution rules
Minimum wageOntario C$17.95 per hour from 1 Oct 2026. Federal C$18.15 from 1 Apr 2026. Quebec, BC and Alberta have own rates (Alberta about C$15). The higher applies where both cover the work.O. Reg. 285/01; Canada Labour Standards Regulations
Income tax withholdingThe employer deducts federal and provincial income tax per CRA payroll tables and remits it. Ontario uses the federal TD1 and Ontario TD1ON. Quebec has separate provincial withholding.Income Tax Act (Canada) s.153
13th or 14th monthNo statutory 13th month bonus or profit-sharing in Canada. Bonuses follow the contract. A regular bonus may count in wages for termination pay if it is earned.ESA 2000 (Ontario)
Remittance of deductionsIncome tax, CPP and EI are remitted to the CRA, usually monthly by the 15th for regular remitters. Larger employers remit more often.Income Tax Regulations
Payslip and pay dayOntario requires a written statement of wages on or before each pay day, with hours, rate and deductions. Pay period and pay day must be set in advance.ESA 2000 (Ontario) Part V
Record of employmentThe employer issues a Record of Employment (ROE) within five days after an interruption of earnings, usually online through Service Canada.Employment Insurance Regulations
Deductions from wagesOnly deductions required by law or authorised in writing are allowed. Employers cannot deduct for cash shortages in most cases.ESA 2000 (Ontario) Part V
Working time
Standard hours (Ontario)Maximum 8 hours per day and 48 hours per week unless the employee agrees in writing and the Director approves excess weekly hours. Daily limit can be 13 hours with consent.ESA 2000 Part VII
Overtime (Ontario)1.5 times pay after 44 hours per week. Many managers and professionals are exempt. Time off in lieu at 1.5 hours per overtime hour by written agreement within 3 months.ESA 2000 Part VIII; O. Reg. 285/01
Rest and breaks30 minute eating period after 5 consecutive hours, 11 hours rest per day, 8 hours between shifts, and 24 hours off weekly or 48 hours in two weeks.ESA 2000 Part VII
Federal hoursFederally regulated employees: 8 hours per day, 40 hours per week standard. Overtime at 1.5 times after that. Managers are excluded from hours of work provisions.Canada Labour Code Part III Div I
Night and Sunday workNo general statutory premium for night or Sunday work in Ontario. Premium applies only through contract, policy or collective agreement. Public holiday work has its own pay rule.ESA 2000 (Ontario)
RecordsOntario employers must keep records of hours worked daily and weekly for at least 3 years, even for employees who are exempt from overtime.ESA 2000 Part VI
Leave and absences
Annual vacationOntario: 2 weeks after each 12 month vacation entitlement year, 3 weeks from the 5th year. Vacation pay is 4% of gross wages, rising to 6% with 3 weeks. Federal: 4% / 6% / 8% (2, 3, 4 weeks at 1, 5, 10 years).ESA 2000 Part XI; Canada Labour Code s.183-184
Province comparisonQuebec: 2 weeks (4%) after 1 year, 3 weeks (6%) after 3 years. BC: 2 weeks after 1 year, 3 weeks after 5 years (4% / 6%). Alberta: 2 weeks, 3 weeks from the 5th year (4% / 6%).Quebec Act respecting labour standards; BC ESA; Alberta ESC
Sick leaveOntario: 3 unpaid job-protected days per year. Federal: 10 paid days after 3 months. BC: 5 paid days. Quebec: 2 paid days after 3 months. Alberta: 5 unpaid days.ESA 2000 Part XIV; Canada Labour Code s.206.6
Pregnancy and parental leaveOntario: up to 17 weeks pregnancy leave and up to 61 weeks parental leave. EI benefits are paid by the government, not the employer (maternity 15 weeks; parental 35 or 61 weeks). Leave is unpaid by the employer.ESA 2000 Part XIV; Employment Insurance Act
Other leaveOntario also has family responsibility, critical illness, bereavement (2 days), and domestic or sexual violence leave. Quebec has a distinct family leave regime (QPIP).ESA 2000 Part XIV
Statutory minimum paid leave, in weeks
How Canada compares with the other markets in this guide, for a 5-day week. Each country has its own verified figure.
United States0 weeks
Canada2 weeks
Public holidays 2026
National days plus regional days. Hover a dot to see its name.
JFMAMJJASOND
Thu 1 JanNational
New Year's DayMon 16 Feb
Family DayOntario, BC and Alberta (not federal or Quebec)
Fri 3 Apr
Good FridayFederal, Ontario, BC, Alberta; Quebec employer may choose Easter Monday
Mon 6 Apr
Easter MondayQuebec only, as an alternative to Good Friday
Mon 18 May
Victoria DayFederal, Ontario, BC, Alberta; Quebec observes National Patriots' Day on this date
Wed 24 Jun
Saint-Jean-Baptiste DayQuebec only
Wed 1 JulNational
Canada DayMon 3 Aug
BC DayBritish Columbia only
Mon 7 SepNational
Labour DayWed 30 Sep
National Day for Truth and ReconciliationFederal and BC (not Ontario)
Mon 12 OctNational
ThanksgivingWed 11 Nov
Remembrance DayBC and Alberta (not Ontario or federal Code)
Fri 25 DecNational
Christmas DaySat 26 Dec
Boxing DayFederal and Ontario; falls on a Saturday in 2026
Ontario has 9 public holidays: New Year, Family Day, Good Friday, Victoria Day, Canada Day, Labour Day, Thanksgiving, Christmas, Boxing Day. Boxing Day 26 Dec 2026 is a Saturday. Civic Holiday is not statutory in Ontario. Dates should be checked against provincial calendars.
Notice periods set by the employer
Hover a row. Bars are drawn to scale.
Under 3 monthsNo ESA notice (common law may still apply)
3 months to 1 year1 week
1 to 2 years2 weeks
2 to 3 years3 weeks
3 to 4 years4 weeks
4 to 5 years5 weeks
5 to 6 years6 weeks
6 to 7 years7 weeks
7 years or more8 weeks (ESA maximum; severance pay may be added)
Ontario ESA notice can be paid instead of worked (termination pay), with benefits continued. Severance pay adds 1 week per year (max 26 weeks) if 5+ years and payroll of C$2.5M or more. Common-law notice can reach 24 months in rare cases. Employee resignation: 1 week (under 3 years) or 2 weeks (3 years or more). Quebec, BC and Alberta have their own ladders.
Rules for ending an employment
Notice or pay in lieuOntario: notice by tenure as shown (1 week per year up to 8). Federal: 2 weeks after 3 months. Quebec: 1 to 8 weeks. BC: 1 to 8 weeks (compensation in lieu). Alberta: 1 to 8 weeks (no severance).ESA 2000 s.54, s.57; Canada Labour Code s.230
Severance pay (Ontario)1 week per year of service (max 26 weeks) for employees with 5+ years at employers with payroll of C$2.5M or more, or in a mass termination. Federal: 2 days per year, minimum 5 days.ESA 2000 s.64; Canada Labour Code s.235
Common-law reasonable noticeWithout an enforceable clause, courts award notice based on age, length of service, role and job market (Bardal factors). It is typically well above ESA minimums.Bardal v Globe & Mail, (1960) 24 DLR (2d) 140 (Ont HC)
Just causeOntario ESA: wilful misconduct, disobedience or wilful neglect of duty that is not trivial and not condoned. Common law uses a contextual proportionality test: the cause must justify dismissal. Cause is hard to prove.O. Reg. 288/01 s.2; McKinley v BC Tel, 2001 SCC 38
Group terminationOntario: 50 or more employees at one establishment within 4 weeks needs notice of 8 weeks (50 to 199), 12 weeks (200 to 499) or 16 weeks (500+), and Form 1 to the Director. Federal: 50+ in a 4-week period needs 16 weeks.ESA 2000 s.58; Canada Labour Code s.212
Special protectionsEmployees on pregnancy, parental or other protected leave, and those with human-rights grounds, cannot be dismissed for those reasons. Federal employees with 12+ months can file an unjust dismissal complaint. Quebec: wrongful dismissal recourse after 2 years.ESA 2000 s.74; Canada Labour Code s.240; Quebec ALS s.124
With FreelanX EOR, ending an employment is run by FreelanX EOR under local law, and the process is agreed with you before any step.
Six signals checked by the authorities
No single signal decides. Authorities and courts weigh the whole picture and look at how the work is really done, not only at the contract.
Source for the criteria: 671122 Ontario Ltd. v Sagaz Industries Canada Inc., 2001 SCC 59 (central question and control, tools, profit/loss, hiring); McKee v Reid's Heritage Homes Ltd., 2009 ONCA 916 (dependent contractor); CRA CPT1 guidance. Confirm with a local lawyer for a specific case.
Getting certainty on the status
How to check the status in advance, or what happens in an audit.
1Request a CRA ruling
Either party can file form CPT1 for a ruling on CPP and EI status. The CRA decides whether the work is employment or self-employment.
2Document the relationship
Use a written services agreement stating independence, deliverables, own tools and right to substitute. The label alone does not decide the case.
3Review actual practice
Courts and the CRA look at how the work is done in practice. Check control, exclusivity and integration yearly.
4Consider a dependent contractor
A dependent contractor is between employee and independent. Common law gives such a worker reasonable notice on termination. ESA rights may not apply.
If the CRA or an ESA inspector reclassifies the worker, the employer owes unremitted amounts. Take legal advice before engaging long-term, full-time contractors.
What a reclassification can cost
Back-payment of contributions, penalties and, in some countries, personal liability.
CPP and EI
If reclassified, the employer owes both employer and employee shares of CPP and EI, plus penalties and interest, and may also owe unwithheld income tax. Ask an adviser how many years back the CRA can assess.
Canada Pension Plan; Employment Insurance Act; Income Tax Act s.227
Penalties
The CRA can apply penalties and interest on unremitted deductions. Penalty for failure to withhold is typically 10% (20% for repeat failures).
Income Tax Act s.227(8)
ESA claims
Ontario prohibits misclassification and puts the burden of proof on the employer. Back pay for overtime, holiday and vacation pay can follow, with a 2-year limit for ESA complaints.
ESA 2000 s.5.1, s.96
Notice and benefits
A reclassified worker can claim termination pay or common-law notice, benefit plan entitlements and WSIB coverage consequences.
ESA 2000; common law
Self-employed registration and payments
CPP as self-employedA self-employed person pays both the employee and employer CPP shares, about 11.9% of earnings between C$3,500 and C$74,600 (maximum C$8,460.90 in 2026), plus CPP2 up to C$85,000.Canada Pension Plan
GST/HSTA contractor must register for GST/HST once taxable revenue exceeds C$30,000 over four consecutive quarters. Ontario HST is 13%.Excise Tax Act s.240
Non-resident contractorsPayments to a non-resident for services in Canada can attract 15% withholding (Regulation 105). Services performed outside Canada normally do not.Income Tax Regulations s.105
Work with independents in Canada, with the paperwork handled
FreelanX Contractors: from $19 per month. Contractor of record from $279.
Work permits: key figures
Where a figure is from a past year, the text says so.
2 weeks
Global Talent Stream processing targetThe LMIA service standard for Global Talent Stream is about 2 weeks. A Labour Market Benefits Plan is required.
230,000
2026 temporary foreign worker targetThe 2026-2028 Levels Plan cuts temporary worker admissions from 367,750 (2025). Permanent residence stays at 380,000.
Work permits in practice
Who needs a permitForeign nationals need a work permit unless exempt. Canadian citizens and permanent residents do not. Employer-specific permits link the worker to one employer.Immigration and Refugee Protection Regulations
LMIAThe Labour Market Impact Assessment proves no Canadian is available. The employer fee is C$1,000 per position. Low-wage streams have been restricted in high-unemployment areas since 2024 and 2025.IRPR s.203; ESDC TFWP
Global Talent StreamTwo-week LMIA route for tech and in-demand roles, via designated referral partners or the Global Talent Occupations List, with a Labour Market Benefits Plan and a wage at or above the market rate.ESDC Global Talent Stream
International Experience CanadaIEC lets young people (usually 18 to 35 depending on country) work in Canada under Working Holiday, Young Professionals or International Co-op. Quotas and age limits vary by country.IRCC IEC
Intra-company transferLMIA-exempt for executives, senior managers and specialised-knowledge staff with 1 year of continuous service in the last 3 years in a related foreign entity.IRPR R205(a), C12
Other LMIA-exempt routesCUSMA professionals, Francophone mobility (outside Quebec), reciprocal agreements and some spouse open work permits. Employer compliance fee is about C$230 for LMIA-exempt hires.IRPR R204-R205
QuebecQuebec adds its own selection: the employer needs a Quebec Acceptance Certificate (CAQ) in addition to the federal permit for most LMIA-based hires.Canada-Quebec Accord
Permanent residenceExpress Entry (Federal Skilled Worker, Canadian Experience Class, category-based draws) and provincial nominee programs. The 2026 PR target is 380,000.Immigration Levels Plan 2026-2028
The 2026-2028 Levels Plan cuts temporary arrivals (385,000 total in 2026, 155,000 students, 230,000 workers) and plans up to 33,000 work permit holders moving to PR over 2026-2027. Check IRCC for current wage thresholds and program changes.
Main sources
The law or official source behind each key point, as of October 2026.
TopicSource
CPP 2026 rates and maximumsCRA (YMPE C$74,600, YAMPE C$85,000)
EI 2026 premium and employer 1.4xCRA / Service Canada
QPP and QPIP 2026Retraite Québec; Revenu Québec
Ontario ESA notice and severanceESA 2000 s.54, 57, 64
Ontario minimum wage C$17.95Ontario O. Reg. 285/01; law firm blog
Federal minimum wage C$18.15Canada Labour Standards Regulations; law firm blog
Vacation and vacation payESA Part XI; Canada Labour Code s.183
Public holidays 2026Provincial and federal holiday lists (dates computed)
Group terminationESA s.58; Canada Labour Code s.212
Non-compete ban OntarioESA s.67.2
Contractor testsSagaz 2001 SCC 59; McKee 2009 ONCA 916
Employer Health Tax and WSIBOntario EHT Act
Immigration Levels Plan 2026-2028IRCC; news summaries
Work permit streamsIRPR; IRCC and ESDC pages
General information, updated monthly. It is not legal advice: for a decision, talk to us or to your counsel.
What to watch
Rules that are changing, or that vary by region or sector.
- 2026 figures: QPIP employer rate 0.602% (employee 0.430%) on earnings up to C$103,000; minimum wage C$16.60 in Quebec (from 1 May), C$18.25 in BC (from 1 June) and C$15.00 in Alberta.
- Ontario 2026: WSIB maximum insurable earnings C$121,700 and average premium C$1.23 per C$100 of payroll. Rates vary by industry and are reset each year.
- Since 1 January 2026, Ontario employers with 25 or more employees must show the pay or a pay range in public job postings, say whether AI screens applicants, and may not require Canadian experience.
- LMIA high-wage thresholds were raised on 17 July 2026 (C$36.92 an hour in Ontario) and are updated each year; check ESDC before filing.
Changelog
Oct 2026Guide rebuilt for Canada with 2026 figures and sources.Canada
Next reviewJanuary 2027, when new yearly rates are published.Planned
Hire in United States with FreelanX EOR
From $499 per employee per month, billed yearly ($549 monthly). Onboarding in 2–10 days.
Employer cost
Statutory contributions$4,590
Estimated total$65,112–$66,732
Statutory contributions$6,885
Estimated total$97,647–$100,077
Statutory contributions$9,180
Estimated total$130,182–$133,422
Statutory contributions$11,475
Estimated total$162,717–$166,767
Statutory contributions$14,339
Estimated total$215,981–$221,381
Gross yearly salary · estimate
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Hire in Canada with FreelanX EOR
From $499 per employee per month, billed yearly ($549 monthly). Onboarding in 2–10 days.
Employer cost
Statutory contributionsC$4,939
Estimated totalC$65,119–C$66,439
Statutory contributionsC$6,227
Estimated totalC$86,467–C$88,227
Statutory contributionsC$6,427
Estimated totalC$106,727–C$108,927
Statutory contributionsC$6,427
Estimated totalC$136,817–C$139,677
Statutory contributionsC$6,427
Estimated totalC$166,907–C$170,427
Gross yearly salary · estimate
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