EMPLOYMENT EQUITY Canada’s Employment Equity Act applies to federal sector employers only. The legislation is designed to encourage employers to hire and promote women, Indigenous people, persons with disabilities and visible minorities. Certain non-federal sector employers must comply with the Employment Equity Act in order to obtain contracts with the federal government. Provinces, including Ontario, allow for “affirmative action” or special programs to address employment equity, but these require significant background work and process. Employment Insurance Employers and employees in Canada are required by the Employment Insurance Act to contribute to the employment insurance account administered by the federal government. Employee premiums are calculated each year. For 2023, the employee premium is 1.63% (1.27% in Québec) of insurable earnings up to a maximum of $61,500 (so that the maximum employee premium in 2023 is $1,002.45, or $781.05 in Québec). The employer must pay a premium equivalent to 1.4 times the employee’s premium. The employer’s contributions are deductible for tax purposes as a normal business expense and may be reduced if the employer supplies a salary insurance scheme to its employees. Employment insurance benefits are paid to employees who apply for benefits due to layoff or termination. Employees who are on maternity or parental leave, or absent due to illness, are also eligible. Self-employed persons are ineligible. No benefits are paid to those who quit a job without cause or who are fired for misconduct.
Most jurisdictions, including Ontario and Quebec, have adopted specific pay equity legislation enshrining the principle of equal pay for work of equal value.
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Doing Business in Canada
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