Payroll and Benefits Guide - Canada - Alberta

Canada - Alberta
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Currency

Canadian Dollar (CAD)
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Capital

Edmonton (State Capital)
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Employer Taxes

8.99%
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Date Format

dd/mm/yyyy
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Fiscal Year

1 April – 31 March

Fun Facts

Alberta is known for its stunning landscapes, including the Canadian Rockies, prairies, and Badlands.

Alberta is home to five national parks: Banff, Jasper, Waterton Lakes, Elk Island, and Wood Buffalo.

The city of Edmonton,  the capital of Alberta, is known as the “Festival City” due to its extensive lineup of year-round cultural festivals.

Alberta experiences long daylight hours during the summer months.

Alberta is the largest producer of oil and gas in Canada.

Alberta is known for its stunning glacial lakes.

Canada-Alberta

Contributions

Employee Payroll Tax

Canada Pension Plan (CPP)5.95%
Federal Employment Insurance (EI)1.63%

Employer Payroll Tax

National Pension5.95%
Federal Employment insurance2.282%
Workplace Safety Insurance0.22%

Payroll

Payroll Cycle

The first payment due to an employee must be made within one month. Wages must therefore be paid on a regular basis at intervals of no longer than 16 days, or one month in the case of supervisory staff. The salaries must be paid on the working day before pay day if it falls on a legal holiday.

13th Salary

In Alberta, Canada, there is no regulation governing 13th-month payments.

Work Hours and Week

The maximum number of working hours is 8 per day, 44 per week, with a maximum of 12 hours per day (including overtime).

Overtime

Weekly work hours are limited to 44, after which time must be compensated at a rate of 150% of wage or taken off for one hour.

In extreme cases, employers shall pay overtime for at least 3 hours at minimum wage when an employee is summoned into duty (during rest or non-working time), even if they work fewer than 3 hours. For specific job classifications, such as numerous management and supervisory positions, overtime exempt status is in place. Employees are entitled to general holiday pay in the following amounts if they work on a public holiday:

  • At least 1.5 times their hourly wage rate for each hour worked on that day, or at least their average daily wage
  • Normal pay rate, where the pay is at least equal to their typical daily income, for each hour worked on a general holiday and a day off with pay.

There is no duty to give general holiday pay if the holiday falls on a day that is not regularly scheduled for work.

Canada-Alberta

Leave

Paid Time Off

n principle, if an employee has worked for the same employer for at least 30 working days in the previous year, they are entitled to paid annual leave; the precise number of days and amount is governed by provincial law.

After the first year of employment in Alberta, employees are entitled to two consecutive weeks of vacation time, and after five years of employment, they are entitled to three consecutive weeks. The daily wage + 1.5 times the regular rate or the regular rate plus one day of paid leave (whichever is higher) is used to compute the eligible pay rate and/or entitlement. This must be paid 14 days prior to the start of a trip.

Public Holidays

9 public holidays are observed. It is normal to grant off the day before or the day after a public holiday when it falls on a weekend.

Sick Days

There is a thirty day qualifying period for covered employees, so on December 31, employees who have been continuously employed for at least 30 days will be able to access their first three days of paid sick leave. The Canada Labour Code was updated with effect from December 1, 2022, to provide ten days of paid sick leave to employees in the federally regulated private sector (which is limited to specific industries).

Employees will start accruing a fourth day on February 1, 2023, and they will keep doing so at a rate of one day each month, up to a total of 10 days per year.

Canada’s Employment Insurance sickness benefits were increased from 15 to 26 weeks starting on December 18, 2022. As a result, eligible persons who file a new claim on or after December 18, 2022, will be entitled to up to 26 weeks of Employment Insurance illness benefits, paid at a rate equal to 55% of their average weekly insurance earnings, with a weekly maximum of $650 in 2023.

Maternity Leave

If an employee has worked for the company for at least a year prior to the due date, they are eligible to up to 17 weeks of leave. Maternity leave must start no earlier than the 17th week before the anticipated due date and must terminate no later than 18 weeks later. The worker is entitled to at least two more weeks of maternity leave if the delivery happens after the anticipated date.

When there is a chance that the pregnancy will end prematurely or when the pregnancy poses a risk to the mother’s or the unborn child’s health, special maternity leave may start four weeks before the due date. A medical certificate and two weeks’ notice are necessary.

Maternity and parenting benefits are provided by employment insurance to:

  • Those who are absent from work due to being pregnant or having just given birth
  • The parents of a newborn or recently adopted kid who are absent from work
  • For 15 weeks, employees are entitled to 55% of their earnings, up to a weekly maximum of CAD 650.

Only those who are absent from work due to being pregnant or having just given birth are eligible for maternity benefits. They are not transferable between parents.

Parental benefits may also be available to the person receiving maternity benefits.

Parental benefits may come after maternity benefits. Both applications can be made at once.

Paternity Leave

Parental leave includes paternity leave.

Parental Leave

For the purpose of caring for a newborn or adopted child, parents are entitled to up to 63 weeks of leave. Before the week of the baby’s birth or after the child is formally adopted, the parental leave cannot start.

No later than 78 weeks after the birth or adoption, the leave should start.

Maternity and parenting benefits are provided by employment insurance to:

  • Those who are absent from work due to being pregnant or having just given birth
  • The parents of a newborn or recently adopted kid who are absent from work

Termination

Termination Process

Unless an employer can show adequate cause for dismissal without notice (due to misconduct, etc.), the termination process is standard in Alberta, Canada, based on termination reasons specified in the General Labour Law.

When proper notice has been given, the last payment must be made within 3 days of the last day of employment; if no proper notice has been given, the final payment must be made within 10 days.

Notice Period

In Alberta, notice periods are often outlined in the employment contract or collective agreement and are dependent on the reason for termination and the length of the employee’s employment, as shown below:

  • If the employee has less than three months left on their contract, no notice is necessary.
  • If the worker is still in their first two years of employment, one week’s notice is necessary.
  • If the employee is between the second and fourth year of employment, two weeks’ notice is needed.
  • If the employee is between their fourth and sixth year of employment, they must give four weeks’ notice.
  • If the employee is between their sixth and eighth year of service, they must give five weeks’ notice.
  • If the employee is between their eighth and tenth year of service, they must give six weeks’ notice.
  • If the person has worked for the company for ten years or longer, they must give eight weeks’ notice.

Severance Pay

n the majority of termination situations, severance compensation is not necessary to be paid.

Probation Period

Probation Period

Although it is not obligatory, the probationary term may be applied. In Alberta, the standard minimum is three months for permanent staff.

Immigration

The Temporary Foreign Worker Program is run by the Canadian government and enables foreign nationals to apply to work in Canada for a specific amount of time. The program is offered when a qualified Canadian citizen or permanent resident is not available or not the right fit for the role, and it covers all employment roles and expertise levels.

There are both federal (Government of Canada) and provincial (Government of Alberta) immigration programs.

The Alberta Immigrant Nominee Program (AINP) is the name of the provincial program in Alberta. The federal government chooses who is granted permanent residency; however, the government of Alberta can only propose people for it. Since the AINP is an economic initiative, Alberta nominates candidates to assist in addressing the needs of the province in terms of employees and enterprises. As the economy of the province changes, Alberta may require different workers and business owners.

VAT

In Alberta, Canada, the usual VAT rate is 5.00%.