Changes in payroll laws and regulations from across Canada
Government tables CPP amendments
The federal government is moving ahead with amendments to the Canada Pension Plan to implement proposals that finance ministers agreed to earlier this year.
On Oct. 6, the government tabled Bill C-26, An Act to amend the Canada Pension Plan, the Canada Pension Plan Investment Board and the Income Tax Act.
The bill would give effect to an agreement in principle that national Finance Minister Bill Morneau and the finance ministers of nine provinces signed over the summer to gradually increase CPP contribution rates, implement a separate, additional rate for high-income earners and raise the plan’s income replacement level.
Quebec was the only province not to agree to the proposals. Changes to the CPP require the approval of seven of 10 provinces representing two-thirds of Canada’s population.
Although the British Columbia government initially supported the agreement, it later announced that it would hold consultations before ratifying it. Earlier this month, B.C. confirmed its support.
Bill C-26 would make a number of changes to the CPP, including raising CPP contribution rates a full percentage point from 4.95, and implementing a separate contribution rate of four per cent for employers and employees.
Morneau says the changes will improve retirement income security for Canadians, reducing the number of families at risk of not saving enough for retirement.
EI rates going down in 2017
Employment Insurance (EI) premium rates will go down next year, the Canada Employment Insurance Commission (CEIC) recently announced.
For 2017, the rate for employees outside of Quebec will drop from $1.88 per $100 of insurable earnings to $1.63. For employees in Quebec, the rate will decrease from $1.52 to $1.27. The rate for Quebec differs because of the Quebec Parental Insurance Plan.
Employers will continue to pay 1.4 times the employee rate unless Service Canada has approved them for a reduced EI rate.
The maximum insurable earnings for EI will increase from $50,800 to $51,300 next year. As a result, the maximum employee EI premium payment will be $836.19 in 2017 for employees outside of Quebec. For those in Quebec, it will be $651.51.
For employers with employees outside of Quebec, the maximum EI premium payment per employee will be $1,170.67 in 2017. For those with employees in Quebec, the maximum will be $912.11. Amounts will differ if the employer has a Service Canada-approved reduced EI premium rate.
The CEIC set the 2017 premium rates using a new rate-setting mechanism.
Under the new process, the CEIC will set the premium rate each year at a level that is forecast to generate just enough premium revenue in the next seven years to ensure that at the end of the seven-year period, the EI Operating Account breaks even.
EI premium reduction program rates announced
The Canada Employment Insurance Commission (CEIC) has announced the 2017 Employment Insurance (EI) premium rate reductions for employers taking part in the federal government’s EI Premium Reduction Program.
For 2017, the following EI premium rate reductions (per $100 of insurable earnings) will apply:
• Category 1 plans: $0.21
• Category 2 plans: $0.36
• Category 3 plans: $0.35
• Category 4 plans: $0.39
The category refers to the group to which Employment and Social Development Canada assigns an employer, based on the type of wage-loss replacement plan the employer has set up.
The CEIC based the reductions on information in the 2017 Actuarial Report on the Employment Insurance Premium Rate. The report, by the chief actuary for EI premium rate setting, provides actuarial forecasts and estimates for calculating EI rates and maximums, including premium reductions for employers with wage-loss replacement plans who are registered with the Premium Reduction Program.
Feds to table pay equity legislation
The federal government will table pay equity legislation for federally regulated workplaces by the end of 2018, says MaryAnn Mihychuk, minister of Employment, Workforce Development and Labour.
“Pay equity is a human right. Proactive pay equity legislation is one of the many measures our government is putting forward to help reduce the gender wage gap, which will strengthen the Canadian middle class and help the many women working hard to join it,” she says.
Mihychuk says the legislation will require employers to regularly and proactively review their compensation systems, identify any gender-based disparities and take measures to address them.
According to the Labour Force Survey from Statistics Canada, in 2015 women in the federal private sector and Crown corporations earned 87 cents for every dollar men earned. The gender wage gap in the federal public service, calculated as the difference between the average hourly wages of all men and all women, was 9.5 per cent in 2014-2015.
Manitoba: Government consulting on minimum wage
The Manitoba government is asking for public input on how it should set the provincial minimum wage rate.
The province’s new government, elected last April, opted not to raise the general minimum wage rate in October, as the previous government had done over the last number of years. The current minimum wage rate is $11 an hour.
The government is asking provincial residents to provide their views on the minimum wage online.
Despite freezing the general minimum wage rate, the government went ahead with a planned increase to the minimum wage rate for security guards. As of Oct. 1, the minimum wage rate for security guards licensed under The Private Investigators and Security Guards Act is $12.50 per hour.
Ontario: New compensation framework in place for public sector executives
The Ontario government has implemented a new framework for compensating executives in the broader public sector, including capping salary and performance-related payments.
The changes, which took effect Sept. 6, apply to all designated employers under the Broader Public Sector Executive Compensation Act, 2014, including hospitals, universities, colleges, schools boards and government agencies. They affect about 340 employers.
The framework caps salary and performance-related payments for the executives at no more than the 50th percentile of appropriate comparators and prohibits signing bonuses, retention bonuses, cash housing allowances and pay in lieu of perquisites.
Designated executives include employees and office holders eligible to receive $100,000 or more in a calendar year, including CEOs, presidents, vice-presidents, chief officers, directors of education and supervisory officers at school boards.
