Canada: Demystifying Canadian Employment And Labor Law

Last Updated: August 22 2016
Article by Anneli LeGault


Because Canada is a confederation of provinces and territories, each with the power to pass employment and labor laws, determining the applicable law in a particular situation can be perplexing to a newcomer to the nation's employment scene. In this article, we hope to clear up some of the confusion.


Under the Constitution of Canada, employment and labor law are local, provincial matters. As a result, all ten provinces, as well as the nation's three territories, have passed legislation that applies locally addressing basic employment standards, occupational health and safety, discrimination and labor relations. Core employment standards include minimum wage, overtime pay, termination pay, mandatory leaves of absence, vacation and holiday entitlements. Consequently, a company with employees located in three provinces, for example, must ensure that it does not pay less than the minimum wage and overtime pay applicable to the respective locations. Typically, Canadian employers harmonize most of their human resources practices across the country to comply with the highest common denominator.

The legislation is enforced in each province by the local provincial or territorial Ministry of Labour or its equivalent. Employee disputes are heard by the provincial tribunals and courts.

The federal sphere

To muddy the waters, the federal government has legislative authority over certain industries regardless of where their employees are located. These are typically national industries or ones that have been determined to be for the good of Canada. They include the airline; interprovincial trucking, interprovincial railways and shipping; telecommunications; radio and television broadcasting; and banking sectors, as well as certain industries, such as grain elevators and uranium mining. For example, employees of Air Canada or Royal Bank of Canada are governed by the same federal legislation whether located in British Columbia, Alberta or Quebec.

The federal employment laws are codified in the Canada Labour Code, the Canadian Human Rights Act and the Employment Equity Act. About 10 percent of the total Canadian work force falls within the federal sphere. A common mistake made by foreign-based employers (non-federally regulated) is to look to the Canada Labour Code on matters where the provincial law is silent. However, this is not the applicable law.

Common law and civil law

In addition to statutory law, the common law jurisdictions (which comprise all of Canada with the exception of the province of Quebec) have followed the British tradition of judge-made common law that evolves over the years. The most significant common law developments for an employer are (i) the requirement to provide "reasonable notice" of termination and (ii) the concept of "constructive dismissal." What constitutes reasonable notice of termination depends on the individual employee's age, length of service, pay, position and other factors affecting his/her re-employability, such as education. Constructive dismissal refers to the right of an employee to consider his or her employment terminated as the result of some type of unilateral employer action to which the employee has not consented, such as a demotion, a material drop in pay or benefits, or even bullying and harassment in the workplace.

Quebec is a civil law jurisdiction with labor standards and labor relations legislation similar to that of the other provinces, but also governed by the Civil Code of Quebec. Fortunately, its employment law has evolved in a manner similar to that of the rest of Canada. However, employers must be aware that the Charter of the French Language declares French to be the language of the workplace. As a result, in this jurisdiction, employers should seek legal advice before issuing documents to its employees in English.

Federal legislation that applies countrywide

While the legislated terms and conditions of employment are local in nature, there are a few basic federal programs that apply everywhere in Canada.

The Income Tax Act applies to all employees and requires employers to deduct and remit income tax on a regular basis. The Canada Pension Plan is a social security plan that requires employers and employees to contribute from pay and provides a pension upon retirement. The Employment Insurance system is also funded through employee and employer premiums and provides benefits to employees upon lay-off, dismissal and during leaves of absence, such as maternity or parental leave, and sickness benefits in certain situations.

Health benefits

Payment for the government-run medical system is provincial. However, some provinces fund their programs through payroll taxes, while others charge premiums. The government-run medical systems typically pay for doctor's visits (not medical specialists), hospitalization, births, diagnostic tests like MRIs, CT scans and X-rays, and medically necessary surgery. Employers will generally use private insurers to purchase other group benefits such as drug plans, dental plans, vision care, long-term disability and life insurance. None of these are mandatory and they are driven by market conditions and competitive imperatives.

Benefits for time off and medical costs resulting from workplace injuries are not paid through private insurance. Instead, each province has a workers' compensation system funded by employers and administered by the local government.

Privacy and data protection

Only three provinces have passed legislation governing employee personal data protection in the private sector: Alberta, British Columbia and Quebec.

Federally regulated private sector employee data is governed by the Personal Information Protection and Electronic Documents Act (PIPEDA). PIPEDA has been declared through a Data Directive of the European Union to provide an adequate level of protection, allowing European Community Member States to transfer personal data to Canada without additional guarantees.

In all provinces, except the three listed above, non-employee personal data is governed by PIPEDA in commercial situations, such as involving client and customer data.

However, the courts have been slowly and incrementally recognizing a limited common law right to privacy. Since 2012, Ontario at least has recognized the tort of intrusion upon seclusion. Simply put, an individual may be awarded damages for an intentional intrusion upon his or her seclusion or his or her private affairs where there is no lawful justification, and the invasion of privacy would reasonably be regarded as highly offensive.


As you can see from the above, the basic principle of Canadian employment law is that there is no underlying countrywide law. Instead, each province and territory regulates workplaces within its borders, with the exception of a limited number of federally regulated industry sectors.

We hope this article helps multinational employers better understand the Canadian HR legal landscape.

About Dentons

Dentons is the world's first polycentric global law firm. A top 20 firm on the Acritas 2015 Global Elite Brand Index, the Firm is committed to challenging the status quo in delivering consistent and uncompromising quality and value in new and inventive ways. Driven to provide clients a competitive edge, and connected to the communities where its clients want to do business, Dentons knows that understanding local cultures is crucial to successfully completing a deal, resolving a dispute or solving a business challenge. Now the world's largest law firm, Dentons' global team builds agile, tailored solutions to meet the local, national and global needs of private and public clients of any size in more than 125 locations serving 50-plus countries.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances. Specific Questions relating to this article should be addressed directly to the author.

To print this article, all you need is to be registered on

Click to Login as an existing user or Register so you can print this article.

Events from this Firm
22 Jan 2018, Webinar, Toronto, Canada

OHS legislation in Alberta and Ontario is changing. The Ontario amendments (including maximum fines and the limitation period for laying charges) are already in effect, and the Alberta amendments (including mandatory joint work site health and safety committees and new duties and obligations for various parties) will come into force soon.

29 Jan 2018, Seminar, Toronto, Canada

Regulatory reforms introduced in the aftermath of the 2008 financial crisis have created a "New Normal," impacting capital markets and other areas of the investment industry.

In association with
Related Video
Up-coming Events Search
Font Size:
Mondaq on Twitter
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
Email Address
Company Name
Confirm Password
Mondaq Topics -- Select your Interests
 Law Performance
 Law Practice
 Media & IT
 Real Estate
 Wealth Mgt
Asia Pacific
European Union
Latin America
Middle East
United States
Worldwide Updates
Mondaq Ltd requires you to register and provide information that personally identifies you, including what sort of information you are interested in, for three primary purposes:
  • To allow you to personalize the Mondaq websites you are visiting.
  • To enable features such as password reminder, newsletter alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our information providers who provide information free for your use.
  • Mondaq (and its affiliate sites) do not sell or provide your details to third parties other than information providers. The reason we provide our information providers with this information is so that they can measure the response their articles are receiving and provide you with information about their products and services.
    If you do not want us to provide your name and email address you may opt out by clicking here
    If you do not wish to receive any future announcements of products and services offered by Mondaq you may opt out by clicking here

    Terms & Conditions and Privacy Statement (the Website) is owned and managed by Mondaq Ltd and as a user you are granted a non-exclusive, revocable license to access the Website under its terms and conditions of use. Your use of the Website constitutes your agreement to the following terms and conditions of use. Mondaq Ltd may terminate your use of the Website if you are in breach of these terms and conditions or if Mondaq Ltd decides to terminate your license of use for whatever reason.

    Use of

    You may use the Website but are required to register as a user if you wish to read the full text of the content and articles available (the Content). You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these terms & conditions or with the prior written consent of Mondaq Ltd. You may not use electronic or other means to extract details or information about’s content, users or contributors in order to offer them any services or products which compete directly or indirectly with Mondaq Ltd’s services and products.


    Mondaq Ltd and/or its respective suppliers make no representations about the suitability of the information contained in the documents and related graphics published on this server for any purpose. All such documents and related graphics are provided "as is" without warranty of any kind. Mondaq Ltd and/or its respective suppliers hereby disclaim all warranties and conditions with regard to this information, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. In no event shall Mondaq Ltd and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use or performance of information available from this server.

    The documents and related graphics published on this server could include technical inaccuracies or typographical errors. Changes are periodically added to the information herein. Mondaq Ltd and/or its respective suppliers may make improvements and/or changes in the product(s) and/or the program(s) described herein at any time.


    Mondaq Ltd requires you to register and provide information that personally identifies you, including what sort of information you are interested in, for three primary purposes:

    • To allow you to personalize the Mondaq websites you are visiting.
    • To enable features such as password reminder, newsletter alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
    • To produce demographic feedback for our information providers who provide information free for your use.

    Mondaq (and its affiliate sites) do not sell or provide your details to third parties other than information providers. The reason we provide our information providers with this information is so that they can measure the response their articles are receiving and provide you with information about their products and services.

    Information Collection and Use

    We require site users to register with Mondaq (and its affiliate sites) to view the free information on the site. We also collect information from our users at several different points on the websites: this is so that we can customise the sites according to individual usage, provide 'session-aware' functionality, and ensure that content is acquired and developed appropriately. This gives us an overall picture of our user profiles, which in turn shows to our Editorial Contributors the type of person they are reaching by posting articles on Mondaq (and its affiliate sites) – meaning more free content for registered users.

    We are only able to provide the material on the Mondaq (and its affiliate sites) site free to site visitors because we can pass on information about the pages that users are viewing and the personal information users provide to us (e.g. email addresses) to reputable contributing firms such as law firms who author those pages. We do not sell or rent information to anyone else other than the authors of those pages, who may change from time to time. Should you wish us not to disclose your details to any of these parties, please tick the box above or tick the box marked "Opt out of Registration Information Disclosure" on the Your Profile page. We and our author organisations may only contact you via email or other means if you allow us to do so. Users can opt out of contact when they register on the site, or send an email to with “no disclosure” in the subject heading

    Mondaq News Alerts

    In order to receive Mondaq News Alerts, users have to complete a separate registration form. This is a personalised service where users choose regions and topics of interest and we send it only to those users who have requested it. Users can stop receiving these Alerts by going to the Mondaq News Alerts page and deselecting all interest areas. In the same way users can amend their personal preferences to add or remove subject areas.


    A cookie is a small text file written to a user’s hard drive that contains an identifying user number. The cookies do not contain any personal information about users. We use the cookie so users do not have to log in every time they use the service and the cookie will automatically expire if you do not visit the Mondaq website (or its affiliate sites) for 12 months. We also use the cookie to personalise a user's experience of the site (for example to show information specific to a user's region). As the Mondaq sites are fully personalised and cookies are essential to its core technology the site will function unpredictably with browsers that do not support cookies - or where cookies are disabled (in these circumstances we advise you to attempt to locate the information you require elsewhere on the web). However if you are concerned about the presence of a Mondaq cookie on your machine you can also choose to expire the cookie immediately (remove it) by selecting the 'Log Off' menu option as the last thing you do when you use the site.

    Some of our business partners may use cookies on our site (for example, advertisers). However, we have no access to or control over these cookies and we are not aware of any at present that do so.

    Log Files

    We use IP addresses to analyse trends, administer the site, track movement, and gather broad demographic information for aggregate use. IP addresses are not linked to personally identifiable information.


    This web site contains links to other sites. Please be aware that Mondaq (or its affiliate sites) are not responsible for the privacy practices of such other sites. We encourage our users to be aware when they leave our site and to read the privacy statements of these third party sites. This privacy statement applies solely to information collected by this Web site.

    Surveys & Contests

    From time-to-time our site requests information from users via surveys or contests. Participation in these surveys or contests is completely voluntary and the user therefore has a choice whether or not to disclose any information requested. Information requested may include contact information (such as name and delivery address), and demographic information (such as postcode, age level). Contact information will be used to notify the winners and award prizes. Survey information will be used for purposes of monitoring or improving the functionality of the site.


    If a user elects to use our referral service for informing a friend about our site, we ask them for the friend’s name and email address. Mondaq stores this information and may contact the friend to invite them to register with Mondaq, but they will not be contacted more than once. The friend may contact Mondaq to request the removal of this information from our database.


    From time to time Mondaq may send you emails promoting Mondaq services including new services. You may opt out of receiving such emails by clicking below.

    *** If you do not wish to receive any future announcements of services offered by Mondaq you may opt out by clicking here .


    This website takes every reasonable precaution to protect our users’ information. When users submit sensitive information via the website, your information is protected using firewalls and other security technology. If you have any questions about the security at our website, you can send an email to

    Correcting/Updating Personal Information

    If a user’s personally identifiable information changes (such as postcode), or if a user no longer desires our service, we will endeavour to provide a way to correct, update or remove that user’s personal data provided to us. This can usually be done at the “Your Profile” page or by sending an email to

    Notification of Changes

    If we decide to change our Terms & Conditions or Privacy Policy, we will post those changes on our site so our users are always aware of what information we collect, how we use it, and under what circumstances, if any, we disclose it. If at any point we decide to use personally identifiable information in a manner different from that stated at the time it was collected, we will notify users by way of an email. Users will have a choice as to whether or not we use their information in this different manner. We will use information in accordance with the privacy policy under which the information was collected.

    How to contact Mondaq

    You can contact us with comments or queries at

    If for some reason you believe Mondaq Ltd. has not adhered to these principles, please notify us by e-mail at and we will use commercially reasonable efforts to determine and correct the problem promptly.

    By clicking Register you state you have read and agree to our Terms and Conditions