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Today’s contingent workforce is growing and evolving exponentially: within the next three years, nearly 50% of the average company’s total workforce will be considered “independent” or “contractor.”
These changes to the workforce have forced businesses to re-balance priorities including quality, cost and of course, compliance. As this trend continues to unfold, companies will look to expand their external workforce to new locales and regions, often unaware of the risks surrounding decisions about global workers that are not made through experienced insight and active management.
On Jun 14, 2016 2:00 PM EDT, CXC Global Americas held a FREE WEBINAR, as part of our Brown Bag Lunch Webinar Series, titled – “Contractor Compliance and Payroll Trends in Canada and Globally” to discuss trends affecting companies and contractors in Canada and the critical importance of global compliance management in today’s CWM programs.
CXC Global Americas Managing Director John Smith & special guest speaker Andrew Wall, VP of CA4IT a Toronto, Canada company, discussed trends affecting companies and contractors in Canada and the latest Canada developments and major global changes that effect contractors and those who engage and manage contractors. The webinar, hosted and sponsored by CXC Global highlighted:
• The ever-changing critical compliance areas every company must track, measure, and monitor.
• Best-in-Class strategies for building an effective global compliance program.
• What the future holds for the “contingent” workforce industry.
• The importance of localized “experts” and services in supporting global contingent workforce programs.
It is part of CXC Global’s mission to educate and assist individuals and companies around the globe in how to adapt to the new world of work and ensure compliance, thereby minimizing their risk.
As promised to attendees, below are the questions asked during the webinar. Our thanks to Andrew Wall of CA4IT Accounting for being our special guest speaker.
Q1. Based on the differences between paid time off holidays and vacation pay, what is the best way for a company to manage this?
- John Smith: A lot of companies would like to accrue vacation and a lot of companies would like to accrue the paid time off holidays, bank holidays or public holidays in Canada. While that can be done, it gets challenging, because with Canada and the provinces having as many as twelve or thirteen paid days off in a year, trying to accrue them for a contractor who is only working for say three months, could put in some extra accruing. What CXC Global recommends, is that we pay the contractors any paid time off holidays when they occur. This allows us to pay it to the contractor in real time and invoice the end client in that same pay period, which keeps things very simple for all.
It’s the same for vacation pay. We can accrue vacation pay up front, but there is an unkown. It’s not a case of accruing a flat .833 days per month. Vacation pay is accrued based on the number of hours worked in the month. We recommend paying the contractors either when they’re taking the time off and invoicing when it occurs, or as we see with probably 90% of our contractors who we payroll in Canada, we pay them at the conclusion of the assignment. Most contractors will accrue it throughout the duration, therefore we pay at the conclusion of the contract.
Q2. How long does it take for a company to setup and how much will it cost to become a fully compliant Corporation in Canada?
- Andrew : It varies from province to province, but one of things CA4IT will do, is that for anyone that is referred by CXC Global, we will give them an at cost corporation price. What that means is that we’ll walk through the setup process so you know you’ve got an accountant that’s knowledgeable to help you get that corporation structured correctly from day 1, for the same cost as if you were to go out and do it yourself. Starting price is usually around $495 CAD here in Ontario, which is one of the cheapest provinces to setup in. We do provincial corporations rather than federal corporations and there are a number of reasons we do that. Bottom line is that the cheapest way to get incorporated, is to either do it yourself or with us. If you do it yourself, you run a high risk of making a mistake and having to go back and amend the articles of incorporation and restructure your corporation, often times too late to then take advantage of the ideal tax structure we would setup for you from day 1. It terms of timing, we can turn around the articles of incorporation (which you would need to sign a contract) sometimes in the same day, usually within 24 hours. In addition to the articles of incorporation, you will also need to register for GST/HST depending on the province, as well as to get a minute book and a CO, which we usually do for our clients. All up, it takes about a week.
If you would like to access a replay of the webinar, please contact Kathryn.Hopkins@CXCGlobal.com. For more information about how CXC Global can assist companies and contractors around the globe, please contact John.Smith@CXCGlobal.com or complete the below contact form.
Follow us @CXCGlobal_CA @CXCGlobal_USA or on Linked-in CXC Global Americas.
Written by Kathryn Hopkins
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