The Ultimate Guide to Hiring Employees in Alberta
Essential Steps for Hiring an Employee in Alberta
Alberta is a business-friendly jurisdiction with the lowest overall taxation rate in Canada for both employers and employees, and one of the lowest small business tax rates. Alberta-based businesses are among the fastest growing in the country, and its highly skilled remote workforce is rapidly growing. All of these make Alberta a top target for international expansion and hiring.
- Population: Estimated 6.4 million
- Currency: Canadian dollar (CAD)
- Conversion rate: 1 USD is equal to 1.33305 CAD
- Languages: English, English and French are the most popular in Alberta
- Most Common Languages: : English, French, Tagalong (Pilipino, Filipino), German, Punjabi, Spanish and Cantonese
- Capital: Edmonton
- Closest Economic Centres: Edmonton, Calgary
- Industries: Oil and Gas, Manufacturing transportation, Utilities (business and commercial), finance and insurance services, Tourism and consumer and real estate
- Time Zones: Mountain Standard Time (MST)
- Date Format: yyyy/mm/dd
- Political System: Constitutional monarchy and parliamentary democracy. Edmonton is where the provincial legislative building is located
- Social System: Welfare state including publicly funded healthcare, subsidized post-secondary education, and employment insurance
Everything You Need to Know About Alberta
Alberta is one of Canada’s wealthiest provinces, enjoying the highest average income combined with a relatively low cost of living. While that wealth has traditionally been owed to resource extraction industries, including oil and gas, and mining, the province’s tech, finance and service industries are booming. As costs rise in other provinces, Alberta has become the number one target for Canadians looking to relocate for housing opportunities, including many highly skilled remote workers who can take their job anywhere. That’s made it a great market for global employers looking for qualified remote talent!
What is Alberta Known for?
- Home to the country’s largest deposits of oil and natural gas
- Famous for its natural beauty housing important nature reserves
- The glaciers and turquoise lakes of Banff and Jasper National Parks
- Nicknamed the princess province
- Embraces its wild west heritage
- Alberta is one of only two landlocked provinces in Canada
- The province offers lower taxes in comparison to other provinces
- Alberta’s most popular wild animal is the rocky mountain bighorn sheep
Hiring Employees in Alberta
Alberta is home to Canada’s most highly educated and technically proficient workforce, including many multi-lingual newcomers. Because the economy is dominated by the extraction industry, with occasional booms and busts, workers in Alberta are always on the lookout for new opportunities – especially remote ones! However, while Alberta remote workers are in high demand, there are some things to keep in mind when it comes to hiring in the province.
In Canada, employment law and taxation have federal and provincial dimensions. Whether you’re hiring contractors or employees, it is important to have a good grasp of Alberta’s unique employment standards. Failure to do so can increase your risk of seriously misunderstanding Alberta’s taxation laws, its standards for worker misclassification and more.
What is the Minimum Wage in Alberta?
In Canada, employment standards, including minimum and overtime wages are determined by the province, not the federal government. Alberta’s minimum wage is $15.00 CAD.
What are the Local Labour Laws in Alberta?
Every province in Canada has its own set of labour laws and employment standards. These laws apply to all employees except those in federally employed or federally regulated industries. In Alberta, the Employment Standards Act is the most significant piece of legislation pertaining to employment, setting out employee rights and employer responsibilities.
- Legal working age: Must be 12 or older, anyone under the age of 18 will need parent or guardian consent to work during restricted hours.
- In Alberta they have the following pension plans, private sector employment pensions, public sector employment pensions, retirement income programs administered by the federal government for Canadians, Alberta seniors’ benefits program and a few others. (This to be covered in more detail in another paragraph)
- Equal pay for men and Women. The Alberta human rights act prohibit
- Use of raw materials, equipment, or merchandise, these must be provided by the employer if the employee is being paid minimum wage
- An employee is entitled to 2 days of paid leave per year (separate to holiday)
- Maternity leave – entitled to up to 18 consecutive weeks of unpaid maternity leave.
- Paternity leave – entitled to 5 consecutive weeks of leave without pay on the birth of his child.
- Holiday is earned over a period of 12 consecutive months from May 1st – April 30th , this is known as the vacation entitlement year.
- Some employers may offer on the condition that their employees take their minimum paid time off, they are also entitled to unlimited PTO.
Most employees in Alberta are entitled to take the following statutory holidays off work and receive public holiday pay:
- January 1, New Year’s Day
- Third Monday in February, Alberta Family Day
- Good Friday or Easter Monday (employer’s choice)
- The Monday preceding May 25, Victoria Day
- July 1 or, if this is a Sunday, July 2, Canada Day
- First Monday in September, Labour Day
- Second Monday in October, Thanksgiving
- December 25, Christmas Day
Employees that work any of these days are entitled to holiday pay at 1.5 times their average daily wage or a substitute holiday day.
Additionally, employers have the option of offering the following general holidays:
- April 10, Easter Monday
- August 7, Heritage Day
- September 30, National Day for Truth and Reconciliation
- December 26, Boxing Day
How to Pay Remote Workers in Alberta
When it comes to hiring in Alberta, international employers have two options. They can open a legal entity in Canada or work with an employer of record. Working with an employer of record is the most popular and preferred option as it is more cost effective and faster.
Work With an Employer of Record in Alberta
Working with an employer of record to hire in Alberta is an efficient and cost-effective option. Employers of record hire candidates on your behalf, handle their onboarding and ongoing payroll, while you manage their day-to-day work. They ensure that your arrangement is fully compliant, minimizing risks of worker misclassification, inadvertently creating a permanent establishment, or finding yourself with a surprise tax bill, and that your employees have in country HR support. Hiring through an employer of record can take as little as 1-2 weeks.
Open a Legal Entity in Alberta
Establishing a legal entity in Alberta suits companies expanding their business, yet proves cumbersome for those solely interested in hiring within the province. Creating a subsidiary involves straightforward steps like incorporation, opening relevant accounts, and obtaining local licenses. If well-prepared, the process can take as little as 2 weeks. A local subsidiary permits conducting business in Alberta and hiring locals directly, but it entails responsibilities such as local compliance and in-country payroll management.
How Do International Businesses Pay Remote Workers in Alberta?
Just like with hiring, international employers have two options for paying their Canadian employees. They can set up a local subsidiary and payroll, or they can hire an Employer of Record who can manage that payroll for them. Employees must be paid in Canadian dollars, with deductions processed every pay cycle and then remitted to the Albertan and Canadian governments. Employers must make their own contributions at the same time. Working with an employer of record like Canadian Payroll Services ensures that local taxes and deductions are processed on time and without error.
What are the Tax Rates in Alberta?
Workers in Alberta pay income taxes to the provincial and federal governments. The two levels of government have different tax rates and different tax brackets, but both are progressive tax systems where your rate “steps up” alongside your income.
The federal income tax rate for different tax brackets in Canada is as follows:
|2023 Taxable income||Federal Tax rate 2023|
|$48,535 or less||15.00%|
|$48,535 to $97,069||20.50%|
|$97,069 to $150,473||26.00%|
|$150,473 to $214,368||29.00%|
|More than $214,368||33.00%|
The provincial tax rate in Alberta is as follows:
|2023 Taxable income||Alberta Tax rate 2023|
|$142,292 or less||10.00%|
|$142,293 to $170,751||12.00%|
|$170,752 to $227,668||13.00%|
|$227,669 to $341,502||14.00%|
|More than $341,503||15.00%|
Employment Standards Act (ESA) in Alberta
The Employment Standards Act of Alberta sets out employee rights and the minimum standard by which employers must treat them. The Act does not govern the treatment of contractors, volunteers, farm and ranch workers, or federally employed or federally regulated workers. The act covers minimum and overtime wages, vacation time, hours of work and breaks, public holidays, how and when payroll must be processed, and more.
- Employers are prohibited from penalizing employees in any way, risks of doing so include being ordered to compensate and/reinstate the employee, ordered to pay a penalty, or prosecuted.
- The ESA gives an employee a greater right or benefit than a minimum employment standard
- No waiving of rights
- Enforcement and compliance, employers who violate the ESA will either be ordered to comply, ordered to pay their employees, ordered to pay a penalty or, in the worst case, prosecuted.
Related Alberta laws include the:
- Occupational Health and Safety Act
- Workplace Safety and Insurance Act, 1997
- Labour Relations Act, 1995
- Pay Equity Act
- Human Rights Code
Alberta Pension Plan
Like all Canadians, workers in Alberta pay into the Canada Pension Plan and will receive benefits from it upon retirement. Contributions to CPP are mandatory for both employers and employers and are set at the federal level. In addition to CPP, some employees in Alberta have access to an additional employer-funded pension, as well as other retirement savings tools. Employer pensions are regulated by the Employment Pensions Act in Alberta. Some employers opt for Group Registered Retirement Savings Plans which can be wholly administered by an outside financial institution.
International employers hiring in Alberta can offer a retirement benefit to their employees by creating a local subsidiary and opening a GRRSP, or by working with an employer of record that offers retirement benefit options.
Hire Employees in Alberta With a Canadian PEO or Employer of Record
Hiring internationally can bring great benefits to your business, but also challenges. A local employer of record, with real experience and presence in the market, can make the hiring process easy and efficient. Canadian Payroll Services can help you hire compliantly in Alberta, without opening a local entity. We handle onboarding, ongoing payroll, and provide both you and your team with ongoing HR support. We provide a full suite of retention tools including health insurance and benefits, health spending accounts, retirement savings options, employment law and market news tips, and more.
Hire Your First Employee in Canada With Canadian Payroll Services
As an employer of record, Canadian Payroll Services can help you hire quickly and compliantly in Canada, without having to open a local entity. We handle payroll, onboarding, and local compliance so that you never have to worry about it.