The Ultimate Guide to Canada PEO Services

What is a Canada PEO?

A PEO - short for professional employer organization - works on behalf of an organization in a “co-employment” arrangement to handle payroll for talent, but is not, for tax or legal purposes, the employer.

A Canadian PEO will pay employees of a third party and may provide other business-critical tasks, such as:

  • Vacation tracking and vacation (PTO) pay accruals
  • Benefits and retirement savings (RSP) management
  • Employee onboarding

A Canada PEO is different from a Canada Employer of Record (EOR) as they don’t take on the legal burden of employment and therefore do not ensure organizations are compliant with federal or provincial employment laws.

By handling payroll and ensuring deductions and taxes are correctly collected and submitted to the Canada Revenue Agency, a Canada PEO eases the burden of small businesses, and allows organizations to stay focused on their business, rather than getting entangled in red tape!

The Ultimate Guide to PEO - PEO vs EOR

Now, let’s dig a little deeper into benefits, advantages, and individual services a Canada PEO provides:

What are the benefits of hiring a Canada PEO, what can they do for your business?

  • Free up critical time and resources:

    A PEO takes on the burden of Canadian payroll and HR administration, freeing you up to focus on talent management and other activities that drive your business’ growth and success.

  • Maintain compliance:

    Canada’s intricate (and ever-evolving) web of federal and provincial tax laws can be tough to learn and navigate. A PEO will ensure payroll deductions are correct and payments are submitted on time and provide proper documentation to the government and employees. They can advise you on how to tax efficiently handle expenses and benefits and ensure compliance for whatever province your talent lives in.

  • Administer employee benefits:

    Working with a PEO can give your business access to a more attractive, robust and cost-effective set of employee benefits. This includes extended health care benefits like physiotherapy, prescriptions, dental care and life and disability insurance.

  • Provide group retirement savings plans (RSP):

    A Canada PEO can offer a range of retirement savings plans (RRSP) for Canadian employees and manage payroll deductions and paperwork on your behalf, handling all transactions and funds.

  • Boost your HR team’s bench strength:

    A Canada PEO may offer additional services that can augment your in-house HR team by providing Canada-specific expertise in areas like HR compliance, recruiting, salary benchmarking, employee onboarding – and more.

  • Support flexible workplaces:

    By ensuring compliance with federal and provincial employment and laws, as well as managing payroll and employee benefits, Canada PEOs make it easy for your organization to attract and retain remote workers no matter where they’re located.

Here’s a stat: According to the National Association of Professional Employer Organizations, small businesses that partner with PEOs grow 7 to 9 percent faster and are 50 percent less likely to close.

What doesn’t a Canada PEO do for your business?

While a PEO takes the bulk of payroll tasks off your plate, do keep in mind that they are not the legal employer so an organization is still responsible for HR compliance and day to day management of talent.

For example, a PEO can’t:

  • Manage or direct day to day employee activities and performance.
  • Ensure compliance with federal or provincial employment law.
  • Recruit candidates or make final hiring decisions. (A Canada PEO can provide guidance on competitive salary, vacation and benefits and even create employment contracts to offer candidates.)
  • Establish pay rates, working hours or employee scheduling. (A Canada PEO can provide you with salary benchmarking to ensure your offer is competitive.)

What type of business would benefit most from Canada PEO services?

While organizations of all types and sizes can use a PEO, smaller businesses typically benefit the most. Why? Smaller businesses tend to have fewer employees and less dedicated resources - particularly for HR functions.

By hiring a PEO, small businesses can focus on growing their company, while still properly supporting their employees. PEOs take on the burden of payroll management that can bog down finance and HR, freeing them to focus on more strategic initiatives.

What questions should you ask a PEO before hiring them?

  • What am I paying for?

    Be sure to understand the full slate of services that are being offered and their associated costs. This helps ensure you aren’t caught off-guard when the first invoice arrives, and that you get what you’re actually paying for.

  • What types of HR or payroll / finance technology do you use?

    This can help you determine whether their systems can be easily integrated into your business and are easily accessible by your team as needed.

  • What kinds of accreditations do you have?

    At a minimum, PEOs should be accredited by the Employer Services Assurance Corporation (ESAC) and have certified payroll compliance professionals (PCP) on staff. .

  • Do you have references from other clients?

    Partnering with a Canada PEO is one of the biggest decisions your business will make.

    So, it makes sense to do a little homework. A good Canada PEO shouldn’t have any qualms with providing client references or reviews upon request. Also – be sure to ask to see references from businesses of a similar size and industry to yours.

Bridgewater Talent Integration: Your Canadian PEO services provider

Bridgewater Talent Integration is a Canadian PEO, as well as a Canadian Employer of Record. That means we handle every talent-related administrative detail on your behalf, and stay on top of ever-changing provincial and federal regulations. We strive to build trust and confidence in every interaction with our clients, and are proud to offer:

  • Canada-wide provincial expertise

    We have been managing payroll for Canadian employees for over 20 years and strive for perfection in terms of accuracy of deductions, documentation and tax submissions. For EOR clients, we provide employment contracts and policies tailored to each Canadian province so if you use our EOR services, you can rest assured you will be compliant with regional and federal employment law as well.

  • Payroll management precision

    Our certified payroll compliance professionals (PCP) know all the federal and provincial rules inside and out. Their expertise encompasses CPP, EI, and income tax deductions, so we can provide you with the best strategies for managing taxable benefits, expenses, paid leave, and business expenses. We also help bring simplicity to tax deductions and provide clear explanations for you and your employees.

  • Seamless and transparent talent integration

    Every aspect, from employee contracts to payroll, benefits, onboarding and offboarding, is expertly managed by our talent integration team.

Ready to free your finance and HR team from the daily grind of admin work? Want to get laser-focused on growing your business and creating the best possible employee experience?