Thinking of partnering with a PEO?
You’re a fast-growing, up-and-coming startup in the US, Europe or Australia and you have a couple Canadians on your team already.
Or - you’re working to get them onboard and already have done the work to set up a legal entity in Canada. Your highly engaged and talented team is laser-focused on core revenue-generating or strategic business functions, like sales, product development and marketing.
And fueling that growth takes focus, so you want to offload some non-strategic (but important) functions like payroll and benefits administration. Payroll in particular is complex and time-consuming, taking up to 5 hours each pay period and 21 days a year.
Now, you might be looking to engage a PEO, or Professional Employer Organization, to help. But before you commit, here are the six questions you need to ask your potential PEO partner.
Six questions to ask a Canadian PEO:
What is the extent of your services and responsibilities?
Why it’s important: If you’re unfamiliar with how PEOs operate, it’s a good idea to understand where their legal responsibilities to your business begin - and end. For instance, PEOs are a “co-employer” or partner organization rather than a legal employer like an EOR (Employer of Record).
As a co-employer, the PEO can help with basic HR tasks, payroll and taxes, as well as benefits administration but does not take on the risks and responsibilities of being a legal employer like an EOR. To use a PEO, you would need to have established a legal entity in Canada (as well as a Canadian bank account) and normally have to show revenue generated in Canada.
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Do you help with onboarding and payroll setup?
Why it’s important: Having your PEO provide HR onboarding helps ensure your Canadian employees have all the information they need to smoothly get set up and enrolled in direct deposit and benefits, as well as become acquainted with Canadian-specific policies and procedures, benefits coverage, accessing pay stubs - and more.
Payroll setup and processing can be a complex, time-consuming process in Canada - especially as different provinces (e.g., Ontario and Québec), have their own tax laws and policies that need to be followed.
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Do you employ certified payroll compliance professionals?
Why it’s important: Payroll compliance professionals (PCP) have undergone extensive training and certification to ensure they are well-versed in all federal and provincial requirements for payroll taxes, deductions, vacation accruals and more.
This provides an extra layer of trust and assurance that your payroll will be accurate and on time, everytime and help you avoid costly tax time surprises.
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Do you have HR experts or a network of experts in each province to advise on HR events?
Why it’s important: HR events, like terminations, can be tricky for your business to navigate if you aren’t completely up to snuff on the complex employment laws governing each Canadian province. Access to HR experts who are well versed in these laws can not only help advise you on how to be compliant, but they can help find the resolution/solution that works best for both employee and company.
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Can you provide Canadian salary benchmarking?
Why it’s important: Your PEO should be able to provide you with insights into the Canadian market and the salaries top talent is demanding. More importantly, the PEO can help you come up with an offer that’s attractive to higher quality candidates.
In terms of employee benefits, your Canadian talent will likely be looking for coverage that includes things like dental, vision, massages, etc. Keep in mind: General healthcare is taxpayer funded in Canada. A PEO will have existing partnerships with benefits providers and can work with you to find the right benefits package.
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How does your fee structure work?
Why it’s important: Your fee will ultimately depend on the number of employees and the level of service you need the PEO to provide. Some PEOs will offer “complete” plans that include basic HR support, payroll and benefits administration. You may even be able to pick and choose the services that your business needs the most.
Generally, a Canadian PEO will charge a percentage of salary but may have a minimum fee per pay if the salary is below a certain threshold. Also - be sure to ask if deposits or any other fees are not included.
Bridgewater Talent Integration: Your bridge to Canadian Talent
Now that you know the six most important questions to ask a Canadian PEO, you’re more than ready to discuss your Canadian PEO needs with us.
Get in touch today!
