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Payroll deductions, and pay statements

Region: Ontario Answer Number: 599

Payroll deductions

Under the law, an employer must make certain regular deductions from an employee’s pay. The deductions that are required by law are income tax for most employees, Employment Insurance premiums, and Canada Pension Plan contributions. If an employer is going to deduct an amount not required by law, the employee must authorize the deduction in writing ahead of time.

If an employer must pay severance pay to an employee, pursuant to judgment or settlement for wrongful dismissal, then only income tax, and in some cases, Employment Insurance, can be deducted.

 

Wage and vacation statements

Under the law, employers must give employees pay statements showing regular wages and vacation pay. Pay statements should be given to an employee every time they are paid and should include:

  • the employee’s wage rate;
  • the pay period for which the wages are being paid;
  • the total (gross) amount earned;
  • any deductions from the employee’s gross amount; and
  • the net amount paid to the employee.

The wage statement must be in writing, or provided by email if the employee is able to make a paper copy. Employers must keep a copy of each employee’s wage statement for three years from the time it was given. For vacation pay, the statement will also need to show how the vacation pay was calculated. For assistance in making deductions or submitting remittances, you should contact an accountant.

Temporary help agencies and their clients

Recent law has also made it necessary for temporary help agencies and their clients to record the number of hours worked by each assignment employee. These records must be kept for three years and be available for inspection.

For additional information about pay statements and deductions, visit the Employment Standards website at the Ministry of Labour at labour.gov.on.ca, or visit Canada Revenue Agency.

A criminal record will appear on an employment police check and will affect your ability to get or keep a job. To erase your criminal record, call toll-free 1-866-898-7767 or learn more at Pardon Pros. It’s easier than you think.

For legal advice and assistance with employment matters, contact our preferred Employment lawyers and see who’s right for you: 

Levitt Employment Lawyers

Samfiru Tumarkin LLP



Samfiru Tumarkin Employment Ontario All Topics Sept 2017Samfiru Tumarkin Employment Ontario All Topics Sept 2017

Levitt April 2017 Ontario Employment Law Topic 599Levitt April 2017 Ontario Employment Law Topic 599

Pardon Pros Employment Ontario Sept 2017 – All topicsPardon Pros Employment Ontario Sept 2017 – All topics




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