Changes in payroll laws and regulations from across Canada
Government reviewing minimum wage
Alberta’s recently elected provincial government says it is working on a new formula for adjusting minimum wage rates in the province. Employers and employees should know what the changes will be by early July, Minister of Jobs, Skills, Training and Labour Lori Sigurdson said in a news release.
The government is consulting with industry associations that represent employers that typically pay minimum wage, as well as labour and public interest advocacy organizations, about establishing a new way to set minimum wage rates. Sigurdson said the government will phase in minimum wage changes beginning Oct.1.
Under current law, the province adjusts minimum wage rates on Sept. 1 every year, based on changes to Alberta’s consumer price index and its average weekly earnings. The new NDP government has called the formula "inadequate." During the provincial election campaign, the party promised to raise the general minimum wage rate to $15 an hour by 2018.
The general minimum wage rate is currently $10.20 per hour. The rate for liquor servers is $9.20 per hour. There are also regulated minimum wage rates for certain salespersons specified in provincial regulations ($406 per week) and domestic employees who live in their employer’s residence ($1,937.00 per month).
New pension law
The British Columbia government will bring its new Pension Benefits Standards Act into force on Sept. 30.
The new legislation, which will replace the current Pension Benefits Standards Act, will modernize the province’s pension plan rules and give employers more pension plan options, said Finance Minister Michael de Jong. He added that the new act will be largely harmonized with Alberta’s pension law to streamline the operation of pension plans that have members in both provinces.
The Ministry of Finance lists the new act’s highlights:
• Employers will be allowed to set up multi-employer target benefit plans. Multi-employer, negotiated cost, defined benefit (DB) plans will be able to convert all benefits (including accrued benefits) to target benefits. Target benefit pension plans combine features of DB and defined contribution (DC) pension plans.
• Active members of pension plans who terminate their membership will be immediately entitled to both employee- and employer-paid contributions, replacing the current two-year vesting requirement.
• The legislation will allow for jointly sponsored pension plans, in which employers and employees have shared responsibility for governance and funding.
• All pension plans will be required to have governance policies. Funding policies will be required for DB and target benefit plans.
• Employers will be able to create solvency reserve accounts in pension plans.
Income tax changes
The provincial legislature has passed changes to the New Brunswick Income Tax Act that create two new tax brackets and tax rates for high-income earners, beginning Jan. 1, 2015.
A new rate of 21 per cent applies to taxable income between $150,000 and $250,000 and a new rate of 25.75 per cent applies to taxable income greater than $250,000. New Brunswick Finance Minister Roger Melanson announced the new rates in this year’s provincial budget.
Even though the changes apply as of Jan. 1, the Canada Revenue Agency (CRA) is implementing them on July 1, with pro-rated tax rates for the new tax brackets applying from Jul. 1 to Dec. 31 for employers that use the agency’s Option 1 for tax calculations. As a result, the following tax rates apply in New Brunswick as of Jul. 1:
Tax brackets = Tax rates (per cent)
$0.01 – $39,973.00 = 9.68
$39,973.01 – $79,946.00 = 14.82
$79,946.01 – $129,975.00 = 16.52
$129,975.01 – $150,000.00 = 17.84
$150,000.01 – $250,000.00 = 24.16
$250,000.01 and over 33.66
The CRA is not prorating the tax rates for employers that use its Option 2 formulas for tax calculations.
The CRA has updated its Payroll Deductions Formulas for Computer Programs (T4127) to incorporate the changes.
New support enforcement act proposed
The provincial government is proposing to create a new act governing the way support orders are enforced in Manitoba.
Gord Mackintosh, minister of justice and the province’s attorney general, tabled Bill 33, The Family Law Reform Act (Putting Children First), in the legislature on June 3. The bill would repeal the Family Maintenance Act and replace it with two new laws, the Family Law Act and the Family Support Enforcement Act.
The Family Support Enforcement Act would govern the use of methods available to the government to enforce support orders. Some methods are already allowed under The Family Maintenance Act, such as support deduction notices employers may receive if they have an employee who must make payments for family support. The new act would permit additional non-employment-related enforcement tools.
The current requirements for employers that receive support deduction notices would continue to apply under the new act. Employers that receive a notice would still have to deduct the amount specified in the notice and remit it by a specified deadline. While the current legislation requires employers to send the payments to a "designated officer," the new act would specify employers must remit the amount deducted to a director of maintenance enforcement. The new act would continue to exempt $250 per month in wages or pension benefits from attachment.
NEWFOUNDLAND AND LABRADOR
Unpaid leave policy
The Newfoundland and Labrador government has implemented a policy that allows provincial public sector workers to take job-protected, unpaid leaves from work if their child is critically ill, child dies or disappears as a result of a probable crime.
The policy matches provisions in the province’s Labour Standards Act that allow eligible employees to take:
• up to 37 weeks off work if they are the parent of a critically ill child (under 18 years) who needs their care or support
• up to 52 weeks off work if they are the parent of a child (under 18 years) who has disappeared as a result of a probable offence under the Criminal Code
• up to 104 weeks off work if they are the parent of a child (under 18 years) who has died as a result of a probable offence under the Criminal Code.
Wiseman said the policy was needed to "alleviate the added stress of worrying about employment" for workers in these situations since the Labour Standards Act is not binding on the provincial government.
Employees planning to take one of the leaves must apply for it in writing and provide documentation to show the need for the leave. Although, the policy applies to all public servants, collective agreement provisions will prevail.
The Ontario Legislative Assembly recently passed legislation that will allow for the creation of pooled registered pension plans (PRPPs) in the province.
Bill 57, the Pooled Registered Pension Plans Act, 2014, received royal assent on May 28; however, the government has not said when the legislation will take effect.
The act incorporates into Ontario law provisions of the federal Pooled Registered Pension Plans Act, with changes where necessary.
As with the federal act, participation in PRPPs in Ontario will be voluntary. Employers will have the option of signing up with a plan. If they choose to do so, the plan administrator will automatically enroll employees, but give them the option to opt out.
Employers will deduct employee contributions for PRPPs from their earnings and remit the amount deducted to the plan administrator. Employers may match employee contributions, but are not required to do so.
PRINCE EDWARD ISLAND
Minimum wage increasing Jul. 1
The minimum wage rate in Prince Edward Island rises from $10.35 per hour to $10.50 on Jul. 1. This is the third increase in a year.