Volume 6 - Payroll Compliance Insider

Your Plain Language Guide to CPP, QPP, EI,
Income Tax & ESA Including the Laws of Québec
Volume 6 - Issue 11
THE YEAR-END PROCESS
November 2012
How to Avoid T4 Mistakes
FEATURES
The Year-End Process
1
How to Avoid T4 Mistakes
77 At a Glance
The 5 Phases of the Payroll
Balancing Process (p.5)
Law of the Month
6
New Formula for Calculating
Wage Loss Replacement Plans
REGULARS
Payroll Month in Review
5
A roundup of new legislation,
regulation, government
announcements, court cases,
appeals and tax rulings
Winners & Losers
Can Employees Waive their Right
to Termination Notice?
12
T
he T4 is the centre of the payroll solar system, the sun around which all of the
other reporting paperwork rotates. And now with the year-end process in full
swing, you need to gather up all your T4 information and ensure all the data
balance out. Here’s how.
WHAT THE LAW REQUIRES
The CRA guide RC4120, “Employers’ Guide: Filing the T4 Slip and Summary” sets out
instructions for completing the T4. CRA guides aren’t laws. But RC4120 is the next
closest thing. According to sub-section 200(1) of the Income Tax Regulations, the
instructions in the guide carry the force of law. So failing to follow those instructions
can lead to penalties (under sub-section 239 of the Income Tax Act).
Technically, section 239 allows for penalizing a “person who has made… false or
deceptive statements” in filing a return. The scary part of this requirement is that:
(i) A payroll manager is considered a “person” under the law; and (ii) Simple errors
in completing the T4 can be treated as false statements. In other words, it’s not just
those who deliberately cheat who can get into trouble for T4 inaccuracies. However,
as a practical matter, it’s highly unlikely that CRA would actually go after a person for
making false statements on a T4 without at least some evidence of fraudulent intent.
HOW TO COMPLY
T4 compliance is a 2-step process: information gathering during the year and balancing
at year’s end.
Step 1: Gather Employee Information
Getting the right information in the T4 slip boxes is just as important as providing
accurate information in other parts of the T4.
CONTINUED INSIDE ON PAGE 2
IN FUTURE ISSUES
• How to Calculate Pay Periods
• Overcoming the Payroll Challenges
of Seasonal Employees
• The Difference between Employees
& Independent Contractors
• How to Ensure Payments Are Timely
LAW OF THE MONTH
New Formula for Calculating Wage Loss Replacement Plans
T
he newly revised T4001(E) Employer’s Guide: Payroll Deductions and Remittances
issued by the CRA on Nov. 19, 2012 contains very few changes. The most
significant changes affecting payroll are the new rules for wage loss replacement
plan (WLRP) payment deductions. Here’s what’s changing.
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Payroll W Compliance Insider
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THE YEAR-END PROCESS CONTINUED FROM FRONT
PAYROLL
COMPLIANCE INSIDER
The Social Insurance Number
The federal government uses the SIN to identify individual employees. Report the wrong SIN on
a T4 and the employee may not be properly credited with CPP contributions. This can lead to a
number of adverse consequences, including loss of CPP retirement benefits that the employee
has legitimately accrued. A SIN faux-pas can also cause employees to receive benefits to which
they’re not entitled and might ultimately have to repay.
BOARD OF ADVISORS
Julie Cuddihy
Fasken Martineau DuMoulin, LLP
Montréal, QC
How to Comply: Check the accuracy of SINs, especially when employees are first hired.
Under both the Canada Pension Plan (section 98 ) and the Employment Insurance Act
Regulations (section 89), employers must ask to physically see an employee’s SIN card. Keep a
photocopy of each employee’s SIN card in the employee files to verify that you’ve complied with
this obligation. Payroll can also rely on the photocopy to enter the employee’s SIN information
into the payroll system. Getting a photocopy of the SIN card also reduces the risk of careless
errors that can easily get made when payroll staff transcribes a particular employee’s SIN
information manually.
Steeve Day, CRHA
Primo International
Montréal, QC
B. Paul Jasiura
Weiler Maloney Nelson
Thunder Bay, ON
You also need to verify the validity of the employee’s SIN. One way to do this is to use
the formula provided by the CRA in guide T4127, “Payroll Deductions Formulas for Computer
Programs.” When implementing a new payroll system, check that this test works properly. Use
a spreadsheet that implements the check-sum formula given in T4127. You should also make
sure that your system doesn’t allow for the same SIN to be used for more than one employee.
Deirdre Joachim
TD Bank Financial Group
Toronto, ON
Ken L. Krohman
MacKenzie Fujisawa
Vancouver, BC
What happens when it’s necessary to hire employees who don’t have a SIN card? Most
payroll systems allow either for the SIN field to be left blank or entered with a dummy value,
such as all zeros. The year-end process should include running a check of the payroll system for
employees without a valid SIN. If you identify any such employees, ask them to produce a valid
SIN card and put a copy of your request in the employee’s files. By showing that you made the
request, such documentation may enable you to avoid penalties for failing to supply the SIN on
the employee’s T4.
Milovan Prelevic
McLennan Ross LLP
Edmonton, AB
W
Employee’s Name
You must also report the employee’s name correctly on the T4. That isn’t as simple as it may
sound.
How to Comply: First, you must list the employee’s legal name as it appears on the SIN
card. For example, if the SIN card lists the employee’s first name as “John,” don’t list “Jack”
on the T4 even though that’s what everybody in the office calls him. Matching the name on
the SIN with the name used for payroll also enables you to verify that new hires aren’t using
someone else’s SIN.
MANAGING EDITOR:
GLENN DEMBY, ESQ.
CONTRIBUTING EDITORS:
CATHERINE JONES
PRESIDENT AND CEO:
ROB RANSOM
Payroll Compliance Insider is published by Bongarde
Holdings Inc. and is intended for in-house use only – commercial
reproduction is a violation of our copyright agreement.
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Employee’s Address
The law requires employers to report employees’ addresses on the T4. Unfortunately, it doesn’t
specifically require employees to provide this information to employers. And, unless payroll
cheques or direct deposit statements are mailed on a regular basis, employees don’t have any
real incentive to give employers their current addresses.
How to Comply: Getting an employee’s address will be easier if employees are provided with
self-service access to update their own contact information. One way employers can validate an
employee’s addresses is to match postal codes against Canada Post’s databases. Canada Post
lists software vendors on the business section of its website (Search for “Address Validation and
Correction Software”) that offer this service.
Step 2: Balancing Payroll & Accounting System Amounts
The next phase of T4 compliance is to balance year-end payroll amounts to values from 3 other
parts of your payroll or accounting systems:
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Payroll WCompliance Insider
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THE YEAR-END PROCESS CONTINUED FROM PAGE 2
77 Remittances recorded as received on CRA PD7A statements;
77 Employee payments for the year; and
77 YTDs in the General Ledger (GL) payroll expense accounts for
the year.
THIS STORY WILL HELP YOU:
Carry out the year-end balance more efficiently and with
minimal risk of reporting errors
The balancing process is where the real year-end effort is required.
BALANCING PHASE 1: PREPARING YTDs
Before you begin the actual balancing, you must prepare the payroll
YTDs you need. Unless you have a payroll system capable of providing
the figures you need as a report, you’ll need to enter the following into
a spreadsheet. Note: List the current totals from each payroll register,
not separate amounts by employee:
77 Source deductions—with separate columns for income tax, CPP,
EI and employer or employee portions;
77 The gross pay and taxable benefits that make up box 14
employment income;
77 Net pay—if your payroll register doesn’t show this is as a
single figure, use separate colums for gross pay and employee
deductions; and
77 Gross pay, employee benefits and employer portions that
are payroll costs debited to GL expense accounts. Note that
some benefits included in employee taxable income, such as
automobile standby charges, aren’t direct employer costs and
should be excluded for balancing purposes.
If your employees are paid through a payroll service bureau,
particularly if the service bureau debits you once each period for a total
of net pay, source deductions and their fees, you’ll need to enter all of
the information listed above plus the fees you pay to the service bureau
in each period.
Key Pointer: Enter the current totals from each pay period or payroll
register, rather than just relying on the YTD totals on the last payroll
register in the year. There are three reasons to do this:
1. You’ll have the detail you need in case you have to trace down
any discrepancies that you find in the balancing process.
2. Some payroll registers don’t include YTD values on the payroll
register for employees who don’t have current values in the
register. The best way to test for this is to take two sequential
payroll registers, where some employees in the first register don’t
appear in the second register. For example, this would be the case
for employees who terminate on the first register. If the YTDs on
the first register, plus the current values on the second register
don’t equal the YTDs on the second
register, you can’t rely on the payroll
Insider Says:
register YTDs for balancing purposes
We’ll refer to these
payroll YTDs as “the YTD
at year-end.
3. What you need are the actual
values processed through payroll,
before any year-end adjustments
for taxable benefits. Employers
spreadsheet,” even though
you may actually take
them from the final payroll
register or some other
payroll report..
commonly adjust final payroll register YTD values for taxable
benefits at year-end. Any such adjustments should only be made
after YTD register values have been balanced. Otherwise, such
adjustments will just make the balancing process more complex.
BALANCING PHASE 2: PD7A REMITTANCE STATEMENTS
Once the preparation is done, you can proceed to the actual balancing.
The first step is to compare the YTD spreadsheet values to your CRA
PD7A statements. This ensures that employees are properly credited on
the T4 with the actual income tax, CPP and EI amounts deducted from
their pay. Explanation: Each month, the CRA provides employers with
a statement of remittances received. For all but Threshold 2 remitters, this
is the PD7A, “Remittance Voucher—Statement of Account for Current
Source Deductions.” As the name implies, the statement has two parts:
77 A voucher for the next remittance; and
77 A statement of the prior remittances credited to your account by
the CRA.
For Threshold 2 remitters the equivalent form is the PD7A(TM),
“Remittance Voucher [Accelerated Remitter]—Statement of Account
for Current Source Deductions.”
Step One: Enter and total on another spreadsheet the remittances
shown as received on each monthly PD7A or PD7A(TM) (for the sake
of simplicity we’ll use “PD7A” to refer collectively to both). This should
only be the remittances for current year income tax, CPP and EI. Don’t
include amounts used to pay any interest or penalties assessed during
the year by the CRA.
Step Two: Check these remittance amounts against the similar
amounts in the YTD spreadsheet. What do you do if the YTD
spreadsheet values don’t match the remittances from your PD7A
statements? It depends on how your remittances are made:
If you make your own remittances, trace the remittance from each
payroll register on the YTD spreadsheet (which is why you entered them
separately by register) through your accounting system. If payments
are made by cheque, the easiest thing to do is to access the accounts
payable files where the vendor payment back-up is kept. If payments
are made electronically, via online banking, your accounting system
should be able to list the payments made to the CRA.
If your remittances are made by a service bureau, verify the payments
to your service bureau for the current year’s remittances against the
remittances received by the CRA and reported on the PD7A.
Step Three: If you or the service bureau uncover payments made
and not shown as recieved on a PD7A statement, you must contact the
CRA to clarify the missing payment(s). The CRA will normally want
proof of payment, such as the front and back of any cleared cheques.
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November 2012 © Bongarde • www.payrollcomplianceinsider.com
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Payroll W Compliance Insider
THE YEAR-END PROCESS CONTINUED FROM PAGE 3
Step Four: If the payments made do balance to the payments
recorded as received on the PD7A statements, the discrepancy lies
in your accounting system, somewhere between producing payroll
registers and the remittances made for them. The most obvious sources
of these are employee payments that have been voided or cancelled.
For example, an employee payment could have been voided before
making the remittances for the period concerned. This would mean
that the remittances shown on the register no longer balance to the
remittances actually made to the CRA. If necessary, these will be
shown as reconciling items between your payroll registers and the
PD7A statements.
BALANCING PHASE 3:
EMPLOYEE CHEQUES & DIRECT DEPOSITS
In the next phase of the balancing process, balance the net pay shown
in your YTD spreadsheet to employee cheque and direct deposit
payments. This ensures that amounts you report on T4s have actually
been paid to employees. The method you use to do this balance will
depend on how you process payroll:
If you process payroll in-house, balancing at year-end will be a much
simpler task if you dedicate a separate GL balance sheet account, i.e.,
a permanent account not closed out at year-end the way income and
expense accounts are, to payroll.
Example: Harbour Publishing does its payroll in-house and pays its
employees by direct deposit. There are two payroll-related GL journal
entries made each pay period. First, from the payroll register, total net
pay is credited to a payroll-only suspense account in the GL. Second,
when employee direct deposits are journalized, the GL cash account is
credited and payroll suspense is debited. Harbour doesn’t use a separate
bank account for payroll purposes. If an employee direct deposit is
returned to Harbour’s bank account, the receipt is journalized in the GL
by debiting cash and crediting the payroll suspense account.
If you use a payroll service bureau, you may find that a bank account
dedicated to payroll makes your T4 balancing tasks easier. If your payroll
service bureau debits your bank account directly for payroll, it might
also be a prudent step to limit its access to a bank account dedicated
to payroll.
Example: Keep Right Cleaners uses a payroll service bureau to
pay employees. The service bureau debits a separate Keep Right bank
account each pay period for the total of employee net pay, source
deduction remittances and service bureau fees. Each period, Keep Right
makes two GL journal entries for payroll. In one, the total of net pay,
source deduction remittances and service bureau fees is credited to
the GL for the separate payroll bank account. In the other, the transfer
of funds to cover payroll is journalized by crediting the general cash
account and debiting the payroll-only bank account. If there’s a problem
with an employee payment, it’s returned to the separate payroll bank
account by the service bureau.
Whichever of these models you use, balancing net pay to employee
payments involves reconciling any such payroll bank or GL suspense
accounts. Reconciling means fully explaining any discrepancy between
two sets of figures or the make-up of an account balance. If you use a
payroll suspense account in the GL, any balance in the account must
be fully explained. For each bank account used for payroll purposes,
any discrepancy between the bank statement and its corresponding GL
account balance must be fully explained.
One common source of such discrepancies are employee payments
that have been voided or cancelled. If an employee direct deposit has
been returned to your bank account, and this hasn’t been journalized,
the return will stand out as an entry on the related bank account
reconciliation. Similarly, if you use a payroll suspense account in the GL
and the return of an employee direct deposit has been journalized, the
returned direct deposit will stand out in the suspense account, unless
the payment has since been replaced or the corresponding payroll
expenses reversed.
Having your payroll bank accounts or GL suspense accounts reconciled
means that net pay has been balanced to employee payments or that
any differences between the two have been fully identified. Payments
to employees flow through such bank or suspense acounts. If anything
remains, these accounts aren’t reconciled until all of the remaining
amounts have been fully explained. You can’t fully explain any such
remaining amounts without uncovering any differences between net
pay on your YTD spreadsheet and the total of employee payments.
BALANCING PHASE 4: PAYROLL EXPENSE ACCOUNTS IN GL
The final step in year-end balancing is to check YTD spreadsheet
values for employer payroll expenses against the matching expense
account balances in the GL. The reason for doing this is the same
as for balancing net pay against employee payments: to ensure that
employment income is only reported on T4s if it has actually been paid
to employees.
As previously mentioned, voided employee cheques or returned
direct deposits are a frequent source of discrepancies between YTD
spreadsheet net pay and actual employee payments made. When payroll
cheques are voided by the employer or direct deposits are returned
to the employer, if these have been replaced or the corresponding
expenses reversed out of the GL, such payments won’t stand out in
a reconcilition of the related bank or suspense accounts. Replacing or
reversing the related expenses will clear any such entries out of these
accounts.
However, if the related GL expenses are reversed, you must be sure
that there’s been a corresponding reversal in the amounts that are T4
reportable. There are generally two ways to do this:
The first is by making an adjusting entry, typically via the time data
entry process, reversing out the gross pay and related deductions. In
this situation, normal payroll cycle processing will adjust the employee
YTD balances. And this will also be reflected in your YTD spreadsheet
used in balancing.
The second way to accomplish a reversal is to directly edit the payroll
system’s YTD balances to reverse out the related gross pay and deductions.
Some payroll systems permit this, but it’s generally not recommended
because the direct manual overwriting of emloyee YTDs can lead to
errors. Unlike entering a reversal through the data entry process, there’s
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Payroll WCompliance Insider
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THE YEAR-END PROCESS CONTINUED FROM PAGE 4
usually no paper trail if YTD balances are directly manipulated. Also,
directly changing employee YTD balances means that payroll registers no
longer match YTD values stored in the payroll system.
For balancing purposes, you must identify all voided or returned
payments, reversed in the GL, that have been reversed in payroll by
directly editing employee YTDs. You also must uncover any errors that
might have been made in such a direct editing of employee YTDs. The
reason this is necessary is because your YTD spreadsheet was built
from the current values shown on each payroll register. Most payroll
systems prepare T4s by reporting on YTD values stored by employee.
If these YTDs have been directly edited, they won’t match your YTD
spreadsheet.
You can idenfity all voided or returned employee payments, reversed in
the GL, by looking at the related GL payroll expense accounts. It should
be fairly easy to identify reversals since these will be credits, whereas
most payroll entries to such expense accounts are debits. Reversals will
also be noticeably smaller amounts than other entries. They’ll also be
easier to find if there’s a standard journal entry description for them,
such as “Reverse cheque XXXX to employee XXXXX.”
When you have found these, the debit balance in these GL payroll
expense accounts, plus the total of any expense reversals in the GL,
should equal the employer expense balance in your YTD spreadsheet.
If not, trace how the employer expense on each payroll register was
journalized in the GL.
BALANCING PHASE 5: FINAL STEPS
After you complete each of the four phases described above, print your
trial T4s and T4 Summary from your payroll system. These should balance
to your YTD spreadsheet less any reversals directly made to YTDs in the
payroll system. If they don’t, ensure that any directly edited reversals were
done correctly in payroll. Add up the valid payments to each affected
employee and make sure these total the YTDs stored in payroll.
After the trial T4s and your YTD spreadsheet balance, adjust
individual employee T4s as follows:
77 Add taxable benefits not processed during the year;
77 Add or subtract any adjustments between taxable benefit
provisions and YTD actuals;
77 Subtract any voided or returned employee payments, which
haven’t or aren’t going to be replaced, and which haven’t yet
been reversed in payroll; and
77 Add or subtract for any errors found in directly editing employee
YTDs in payroll.
CONCLUSION
The end of the old year and the beginning of the new one is a time
for optimism and renewal. But if you process payroll, it’s a season of
grind work. Accurate year-end reporting is one of your most important
responsibilities as a payroll manager. And it all has to be done
seamlessly and without interrupting the ongoing process of paying
employees for the current year. Laying out the process step-by-step
won’t relieve you of this burden. But it should help you get yourself
organized and carry out the work efficiently and without the kinds of
T4 errors that typically get made when payroll doesn’t have a tight rein
on the year-end balancing process. W
AT A GLANCE
The 5 Phases of the Payroll Balancing Process
PHASE 1: Enter the current totals from
each register or pay period needed for
balancing into a YTD spreadsheet.
PHASE 2: Balance PD7A Remittance
statements:
77Step 1: Enter the remittances
recorded as paid on CRA
PD7A statements into another
spreadsheet.
77Step 2: Compare the PD7A
remittance totals to the remittances
on your YTD spreadsheet.
77Step 3: If necessary, match your
actual payments to the CRA to the
remittances they show as received
on the PD7A.
77Step 4: I f necessary, identify any
voided or cancelled payments
required to reconcile between
the payroll registers and the
remittances made.
PHASE 3: Reconcile all bank accounts
or General Ledger suspense accounts
used in payroll to identify any voided
or cancelled employee payments that
haven’t been replaced or reversed out
of the GL.
PHASE 4: Balance the payroll expenses
shown in the YTD spreadsheet to the
year-end debit balances of the matching
GL expense accounts. Identify any
employee payments that have been
reversed in payroll through directly
editing employee YTDs. These will be
reconciling items between your YTD
spreadsheet and the debit balances of
the GL payroll expense accounts.
PHASE 5: Print and balance your trial
T4s to your YTD spreadsheet, taking into
account any reconciling items found
above.After balancing adjust employee
T4 values for any:
77Taxable benefit adjustments
required;
77Voided or cancelled payments not
yet reversed out of payroll; and
77Any errors found in manually
editing employee YTDs.
November 2012 © Bongarde • www.payrollcomplianceinsider.com
Payroll W Compliance Insider
6
PAYROLL MONTH IN REVIEW
A roundup of new legislation, regulations, government
announcements, court cases and arbitration rulings
LAW OF THE MONTH (cont’d from page 1)
New Formula for Calculating Wage Loss Replacement Plans
OVERVIEW OF THE CHANGE
What’s Changing: WLRPs are an arrangement in which an employer
provides benefits to employees—either directly or via an insurer. The
change affects how to calculate source deductions on WLRP payments
to employees.
Types of Benefits Affected: Benefits paid to employees under a
WLRP typically include:
77 Short-term disability (STD);
77 Long-term disability (LTD); or
77 Weekly indemnity (WI) benefits.
Which Plans Are Affected: A plan is considered a WLRP if all 5 of
the following things are true:
1. It’s a group plan covering more than a single employee;
2. The employer funds the plan, in whole or in part;
3. The plan’s purpose is to indemnify, i.e., pay for, losses of
employment income employees incur as a result of illness, accident
or maternity;
4. Benefits are paid periodically and not in a lump-sum; and
5. Funds are accumulated normally in the hands of a trustee or trust
account and calculated to ensure there’s enough money to cover
claims, a la an insurance plan.
THE CHANGES
The changes explained in the 4001(E) apply to different kinds of source
deductions from WLRP payments:
Source Deductions for EI and CPP
The rules government when WLRP payments are subject to source
deductions for EI premiums and CPP contributions vary depending on
who actually pays the benefits to employees:
Employer Pays: If the employer pays the WLRP benefits directly
to the employee, EI/CPP deductions are required where the employer
funds any part of the plan.
Third Party Pays: If the WLRP benefits are paid on the employer’s
behalf by a trustee or insurance company, EI/CPP deductions are
required where the employer:
77 Funds any part of the plan; AND
77 Exercises a degree of control over the plan’s terms; AND
77 Determines eligibility for benefits.
Source Deductions for Income Tax
If WLRP benefits payments are subject to EI/CPP source deductions,
income tax must also be withheld from the payment as well. The
employer, trustee or insurance company must report these payments
on the T4—as well as the income tax, CPP and EI deductions made on
the payments.
If WLRP payments are not subject to EI/CPP source deductions,
they’re still subject to income tax. But no withholding from the actual
benefit payment is required. W
LAWS & ANNOUNCEMENTS
Minimum Wage
Oct. 1: Reminder: Manitoba increased its minimum wage 25¢ to
$10.25 per hour.
Public Health
Oct. 29: Health clinics in the Yukon began administering free flu
immunization shots to residents as planned. Although available free
of charge to all ages, vaccination is especially important for the elderly,
infants and individuals with chronic health conditions leaving them
vulnerable to flu.
Immigration
Oct. 12: A new program called Recognition Counts! will provide
“microloans” of up to $10,000 to skilled immigrants to help them
get the accreditation and recognition they need to ply their trade
in Manitoba as soon after they arrive as possible. Borrowers don’t
have until 90 days after they find a job to begin paying down the
loan and will have up to 5 years to pay back all the money.
Jobs
Oct. 19: Manitoba will provide $355,000 in funding for 2 projects
to help disadvantaged people get training and find jobs:
77Citizen’s Bridge expands the BUILD pilot which provides
driver’s training
77Enterprising Non-Profits Manitoba helps non-profits start up
new social enterprises.
November 2012 © Bongarde • www.payrollcomplianceinsider.com
YUKON
MANITOBA
LAWS & ANNOUNCEMENTS
CASES
Mine Owner Gets Maximum Fine for Worker’s Death
A 25-year-old mechanic was killed after being buried under 70 tonnes
of rock while servicing equipment in an underground mine. Although
co-workers were unhurt, a safety expert concluded that the mine’s
safety program wasn’t “‘robust or comprehensive enough for the type
of operation or high hazard environment.” The mine owner pleaded
guilty to an OHS offence and was fined a maximum $150,000. The
Crown wants the judge to fine the contractor that hired the victim,
who also pleaded guilty, the same amount [Yukon Zinc Corp. and
Procon Mining and Tunnelling, Nov. 14, 2012].
Payroll WCompliance Insider
LAWS & ANNOUNCEMENTS
LAWS & ANNOUNCEMENTS, Cont’d
CPP
Nov.: Here are the proposed 2013 CPP rates:
AMOUNT/RATE
FEDERAL
2013
2012
Maximum pensionable earnings
$51,100
$50,100
Basic exemption
$3,500
$3,500
Employer/Employee contribution rate
4.95%
4.95%
Self-employed contribution rate
9.9%
9.9%
Maximum employer/employee contribution
$2,356.20
$2,306.70
Maximum self-employed contribution
$4,712.40
$4,613.40
Pensions
Nov.: 2013 federal pension rates:
AMOUNT/RATE
2013
2012
Money Purchase limits
$24,270
$23,820
RRSP limit
$23,820
$22,970
YMPE
$51,100
$50,100
DPSP limits (1/2 MP limit)
$12,135
$11,910
$2,696.67
$2,646.67
Defined Benefit limits
7
Deductions & Remittance
Nov. 19: CRA issued the revised T4001(E). Key changes:
77Extension of $1,000 (maximum) one-time hiring credit for small
businesses for 2012
77New rules for calculating deductions for wage loss replacement plans
(See LAW OF THE MONTH above)
77Direct deposit now available for payroll accounts via Form RC366, Direct
Deposit Request
77New CRA video about payroll rules for owners of small business.
Human Rights
Nov. 5: The Canadian Human Rights Commission issued a bulletin
recommending the use of Alternative Dispute Resolution, i.e., arbitration,
mediation and conciliation rather than litigation, to resolve discrimination
complaints. The bulletin also lists names of individuals and firms that
provide discrimination ADR services in different parts of the country.
Workplace Violence
Nov. 7: The Canadian Standard Association published the final version of its
long awaited standard for psychological health and safety in the workplace.
CSA Z1003/BNQ 9700 calls on employers to establish a psychological
health and safety management system to ensure that all people in the
workplace are treated with dignity and respect. Although it’s a voluntary
standard, it may become a benchmark for legislation and a best practice
that courts refer to in judging if employers have done enough to protect
employees from bullying, harassment and other forms of psychological
violence and abuse.
Tax Forms
Nov.: CRA forms and publications so far in November
77T4A-RCASUM Information Return of Distributions From a Retirement
Compensation Arrangement (RCA) (Nov. 20)
77T1-ADJ T1 Adjustment Request (Nov. 19)
77T4001 Employers’ Guide - Payroll Deductions and Remittances (Nov. 19)
77T4E Statement of Employment Insurance Benefits and Other Benefits (Nov. 16)
77T4E(Q) Statement of Employment Insurance Benefits (Quebec) (Nov. 16)
77T776 Statement of Real Estate Rentals (Nov. 16)
77EDM1-1-2 Regional Excise Duty Offices (Nov. 15)
77EDM1-1-5 Instrument Certification (Nov. 15)
77T3AB Alberta Tax (Nov. 15)
77T3BC British Columbia Tax (Nov. 15)
77T3MB Manitoba Tax (Nov. 15)
77T3NB New Brunswick Tax (Nov. 15)
77T3NL Newfoundland and Labrador Tax (Nov. 15)
77T3NS Nova Scotia Tax (Nov. 15)
77T3NT Northwest Territories Tax (Nov. 15)
77T3NU Nunavut Tax (Nov. 15)
77T3ON Ontario Tax (Nov. 15)
77T3PE Prince Edward Island Tax (Nov. 15)
77T3SK Saskatchewan Tax (Nov. 15)
77T3YT Yukon Tax (Nov. 15)
77T5007 Statement of Benefits (Nov. 15)
77TIS28 Lend a Hand! Need a Hand? (Nov. 15)
77NR73 Determination of Residency Status (Leaving Canada) (Nov. 14)
77NOTICE276 Elimination of the HST in British Columbia in 2013 –
Transitional Rules for Real Property Including New Housing (Nov. 13)
77T2SCH1 Net Income (Loss) for Income Tax Purposes (2009 and later tax
years) (Nov. 13)
77T2005 Agreement Among Associated Corporations to Allocate an
Amount to Calculate Their Base Level Deduction (Nov. 13)
77T4PS Statement of Employee Profit-Sharing Plan Allocations and
Payments (Nov. 9)
77T4PSSUM Employees Profit Sharing Plan Allocations and Payments (Nov. 9)
77T4091 T5008 Guide - Return of Securities Transactions (Nov. 9)
77EDM3-1-1 Producers and Packagers of Spirits (Nov. 8)
77T4127-JAN Payroll Deductions Formulas for Computer Programs - 96th
Edition - Effective January 1, 2013 (Nov. 8)
77RC201 Working Income Tax Benefit Advance Payments Application for
2013 (Nov. 5)
77NR4 Statement of Amounts Paid or Credited to Non-Residents of Canada
(Nov. 2)
77NR4SUM Return of Amounts Paid or Credited to Non-Residents of
Canada (Nov. 2)
77T4A-NRSUM Summary of Fees, Commissions, or Other Amounts Paid
to Non-Residents for Services Rendered in Canada (Nov. 2)
77T2022 Election in Respect of the Sale of Debts Receivable (Nov. 2)
77T4061 NR4 - Non-Resident Tax Withholding, Remitting, and Reporting
(Nov. 2)
77RC4630 Competency Catalogue (Nov. 1)
77T10 Pension Adjustment Reversal (PAR) (Nov. 1).
CASES
Air Canada Can’t Cut Health Benefits but Can Tighten Claims
Procedures
Air Canada implemented a new procedure requiring flight attendants
to get pre-approval of eligibility for orthotics, orthopedic shoes and
compression stockings. It argued that the strict new claims procedure was
necessary to prevent fraud, noting that claims had increased dramatically
and suspiciously in the previous months. The Board agreed and upheld
the pre-approval requirement; but it also found that the airline couldn’t
cut benefits under the plan unilaterally [Air Canada v. CUPE, Air Canada
Component, [2012] C.L.A.D. No. 280, Oct. 11, 2012].
CP Workers Don’t Get Extra Pay for Attending Safety Training
28 CP workers demanded $15 per hour in extra pay for attending 90
minutes of training on safe lifting. Safety training isn’t a daily duty covered
by their route wages, the union claimed. The arbitrator disagreed, noting
that providing such training was a duty of CP and that receiving the
training to ensure their health and safety was a necessary and integral
part of their daily work. And there was no evidence that attending training
caused any of the workers to exceed their normal workday or workweek
hours [Canadian Union of Postal Workers v. Canada Post Corp., [2012]
C.L.A.D. No. 307, Nov. 1, 2012].
November 2012 © Bongarde • www.payrollcomplianceinsider.com
Payroll W Compliance Insider
8
BRITISH COLUMBIA
LAWS & ANNOUNCEMENTS
CASES
Workers’ Compensation
Nov. 2: BC is increasing 2013 workers’ comp premium rates from $1.54
to $1.63 per $100 of assessable payroll, the first increase in 9 years.
Meanwhile, WorkSafeBC is looking into whether to beef up workers’ comp
premium incentives to employers for meeting injury prevention targets.
Employer’s Liability Insurance Doesn’t Cover Employee’s Drunk
Dancing Accident
After attending a company dinner at a Vancouver restaurant, some
associates of a law firm decided to visit a nearby nightclub. What
happened next was a disaster. A senior associate, who had drank too
much, tripped while dancing with a student intern causing her to crash to
the floor. The intern suffered a traumatic brain injury and when workers’
comp turned her down, won a $5.9 million lawsuit against the associate
whose negligence was found to be the sole cause of the student’s injuries.
The associate accepted full blame but claimed the accident was covered
by the law firm’s liability insurance. But the court disagreed. The insurance
policy covered negligence by employees in the course of their duties.
While the dinner might have been a work function, the nightclubbing
was not. So the insurance didn’t cover the claim [Danicek v. Alexander
Holder Beaudin & Lang, [2012] B.C.J. No. 2257, Nov. 2, 2012].
BC Court: Work Injuries Are for Workers’ Comp, Not Courts to
Decide
A construction worker claimed that her co-worker’s conduct caused
her mental stress. After workers’ comp denied her claim, she brought a
damages lawsuit in a civil court against the co-worker and her employer. But
the court threw out the case. The whole point of workers’ comp is to keep
employee injury/illness claims within the workers’ comp system and out of
the courts. Letting employees sue employers and co-workers for damages
in court would open the litigation floodgates, the court reasoned [Downs
Construction Ltd. v. BC (Workers’ Compensation Appeals Tribunal), [2012]
B.C.J. No. 2035, Oct. 4, 2012].
Arbitrator Cuts Safety Suspension in Half
A sawmill suspended an employee 6 days for safety infractions—smoking
near a propane tank and not wearing his hardhat and safety glasses. The
union claimed the penalty was too harsh and the arbitrator agreed. The
employee had been warned before—although not formally, the arbitrator
acknowledged. And he didn’t immediately acknowledge fault or express
remorse. Still, 6 days was excessive given the penalties imposed on other
employees for similar violations. So the arbitrator cut the suspension to 3 ½
days [Tolko Industries Ltd. (Kelowna Division) v. United Steelworkers, Local
1-423 (Holmes Grievance), [2012] B.C.C.A.A.A. No. 130, Oct. 22, 2012].
Workplace Violence
Oct.: BC issued translations of its Domestic Violence in the Workplace
Tool Kit in 9 languages: Traditional Chinese, Simplified Chines, French,
Korean, Spanish, Vietnamese, Punjabi, Hindi and Tagalog.
Workplace Safety
Oct: WorkSafeBC revised some of its OHS guidelines and issued new
ones covering:
77Warehousing of controlled products
77Good practices for applying pesticides
77Alternate standards for safety headgear & buoyancy equipment
77Vertical lifelines
77Automotive lifts & other vehicle support
77Training requirements for aerial device operators
77Forklifts
77Electrical safety & protective equipment
77Rope replace for evacuation & rescue.
Pensions
Oct.: Financial Institutions Commission issued 3 new pension bulletins:
77Updates to Bulletin 12-004, Restrictions to Commuted Value Transfers
77Bulletin 12-003, Introducing the Actuarial Information Summary
77Bulletin 12-002, Filing Off-Cycle Actuarial Valuation Reports.
Collective Bargaining
Oct.: Key contracts agreed to by BC and public employees during the month:
77Tentative 4 year deals with University of BC, University of Northern
BC & Thompson Rivers University employees
77Tentative 2 year deal between University of Victoria & non-faculty
professional administrators
77Ratified 4 year deal with UBC support staff
77Ratified 2 year deal with nurses
77 Tentative deal between Ministry of Social Development & social workers.
ALBERTA
LAWS & ANNOUNCEMENTS
CASES
Workplace Safety
Oct. 5: Alberta began reviewing the OHS Code including provisions affecting:
77Chemical Hazards, Biological Hazards & Harmful Substances
77Cranes, Hoists & Lifting Devices
77Rigging
77Scaffolds & Temporary Work Platforms
77Explosives
77Mining
77Exposure Limits for Chemical Substances.
Alberta Labour Board Refuses to Get
Involved in NHL Lockout
The NHL players’ union asked the Alberta Labour
Relations Board to declare the NHL lockout
illegal in the province of Alberta. No thanks, said
the Board. The legality of the lockout involves
the labour laws of not just Alberta but other
provinces, not to mention the U.S. So even if
we did have jurisdiction to decide the case, we
wouldn’t exercise it, the Board ruled [Edmonton
Oilers Hockey Corp. (Re), [2012] A.L.R.B.D. No.
73, Oct. 10, 2012].
Fines
Oct. 23: Bill 6 would increase penalties to employers that violate OHS and fair trading laws. Highlights:
77Maximum penalty for first safety offence increased from $15K to $100K
77Maximum penalty for subsequent offence increased from $30K to $500K
77Administrative penalties of up to $10K for OHS and $100K for fair trading violations.
Pensions
Oct. 25: Bill 10, a pension reform bill, got first reading. Highlights:
77Coordinate Alberta pension rules with BC
77Extended timeline to fund DB deficits
77Establishment of new target benefit plans, a more flexible version of DBs where benefit amount
is defined but subject to revision
77Establishment of new jointly sponsored plans in which members and employers share plan costs
77Immediate vesting of DB benefits rather than after 2 years
77Lock in based on minimum dollar amount rather than years of service.
Whistleblowers
Oct. 25: The government tabled a bill protecting whistleblowers in the public sector including
employees of the Alberta Public Service, provincial agencies, boards and commissions, academic
institutions, school boards and health organizations. Bill 4 would also create an Office of the Public
Interest Disclosure Commissioner to investigate and resolve whistleblower complaints and dish out
fines of up to $25,000 for a first offence and up to $100,000 for subsequent violations.
Workers’ Compensation
Dec.: Reminder to employers: You’ll need to get your 2013 premium rate statement electronically
from the WCB starting in mid-December. The old paper statements are going away for good.
November 2012 © Bongarde • www.payrollcomplianceinsider.com
No Random Drug Testing Until Arbitrator
Decides
A judge ordered Suncor to temporarily stop its
new random drug testing program for oil sands
workers in northern Alberta until an arbitrator
reviews if it’s legal. The ruling doesn’t affect
Suncor’s program of testing employees after
safety incidents occur [Communications, Energy
& Paperworkers Union, Local 707 v. Suncor
Energy, [2012] A.J. No. 1050, Oct. 22, 2012].
Alberta Can Fine Chinese Company for Oil
Sands Workers’ Deaths
Two foreign oil sands workers died and another
5 were injured when the roof of a tank they were
working on collapsed. The employer, a Chineseowned company, first claimed Canada had no
jurisdiction over the case. When that defence
failed, it pled guilty to 3 OHS violations. The
government is asking for a $1.5 million fine
with sentencing slated for Jan. 24, 2013 [SSEC
Canada, Oct. 4, 2012].
Payroll WCompliance Insider
9
ONTARIO
LAWS & ANNOUNCEMENTS
CASES
Workplace Safety
Oct.: It was a busy month for Ontario OHS reform.
First, the brand new Prevention Council met for the
very first time. Then, in a long anticipated move, the
MOL issued revised versions of its guidance on both
the OHS Act and Joint Health & Safety Committees to
reflect changes to OHS laws contained in what was
once called Bill 160.
Making Pregnant Receptionist Stand All Day Is Discrimination
Standing all day was fine for a gym receptionist until she got pregnant and her legs and
feet began to swell. Her doctor wrote the gym a note saying that it was unhealthy for the
receptionist to stand for prolonged periods and advising that she be allowed to sit. But the
manager said no because he thought that having a chair or stool at the counter would get in
the way. The Ontario Human Rights Tribunal found the gym guilty of disability discrimination.
The gym never investigated whether having a chair would actually create a tripping hazard or
seek alternative ways to accommodate the receptionist, said the Tribunal [Purres v. London
Athletic Club (South) Inc., [2012] O.H.R.T.D. No. 1735, Sept. 19, 2012].
Employer Needn’t Reinstate Mentally Disabled Worker Fired for Violence
After attempts to accommodate his mental disability failed, an employer fired an employee
for engaging in violent and erratic behaviour. The arbitrator refused to reinstate him, citing
his history of physical violence and “brief psychotic outbursts,” including one episode of
showing up to work with his pit bull. Reinstatement would endanger others and violate the
employer’s duty to prevent workplace violence [Agropur Division Natrel v. Teamsters Local
647, [2012] CanLII 69477 (ON LA), Nov. 15, 2012].
Firing Transgender Employee Is Sex Harassment
An employee who was a biological man when he was hired claimed he was fired for choosing
to live as a woman. Nonsense, said the employer; the employee was fired for insubordination
and a bad attitude. After hearing all the evidence, the Tribunal ruled that the firing was at
least in part due to sex harassment citing the employer’s refusal to let her use the women’s
restroom and change her shift so she wouldn’t have to change clothes in the presence of male
co-workers. And to the extent the employee had behaved aggressively, she did so in response
to provocation and harassment from co-workers [Vanderputten v. Seydaco Packaging Corp.,
[2012] O.H.R.T.D. No. 1946, Oct. 18, 2012].
Headhunter Didn’t Do Enough to Earn a Placement Fee
A headhunter demanded its 20% fee for placing a new loyalty marketing associate at a client
consulting firm. But the court tossed out the case. The contract required the headhunter to
make a “proactive presentation” of the candidate. All the headhunter had done was send
over her resume and a few follow-up emails. The candidate knew about the client through
her fiancé and actively pursued job opportunities with the firm with little to no help from
the headhunter—she had essentially placed herself. So the client didn’t have to pay the
headhunter’s placement fee [IQ Partners Inc. v. Maritz Canada Inc., [2012] O.J. No. 4839,
Oct. 15, 2012].
OK to Fire Employee for Forklift Daredevilry
While “turning donuts” on his forklift, i.e., deliberately speeding into a puddle, slamming the
brakes and wrenching the wheel to cause a spin, a recycling company employee lost control
of the vehicle and slammed into a concrete wall. Nobody got hurt but it cost the employee
his job. It was a stupid and dangerous stunt, said the Labour Board, especially considering
that the employee served on the company safety committee. And the fact that he initially
denied the incident was even more reason to uphold the decision to terminate him without
notice [Sims Group Recycling Solutions Canada Ltd. v. Barrett, [2012] CanLII 60602 (ON
LRB), Oct. 10, 2012].
Nasty Temper ≠ Disability Requiring Accommodation
Police responding to a 911 call about a domestic disturbance had to taser an off-duty cop
in his home to subdue him. The cop pleaded guilty to violating the Police Services Act and
was fired. He appealed, claiming that his anger management issues and alcohol and drug
addictions were disabilities that the police department had to accommodate. But the court
disagreed and upheld his termination. A nasty temper isn’t a disability under human rights
laws; and while addiction is a disability, there was no evidence the cop had an addiction
[Gulick v. Ottawa (City) Police Service, [2012] O.J. No. 4621, Oct. 3, 2012].
Workers’ Compensation—Premiums
Oct. 24: If you’ve been following the Ontario workers’
comp $14.2 billion deficit situation, you knew a
rate increase was coming. And now the WSIB has
announced a major 2.5% increase in workers’ comp
premiums for all employer rate groups in 2013.
Average assessments are going up from $2.40 to
$2.46 per $100 assessable payroll.
Workers’ Compensation—Benefits
Oct. 22: The government proposed important changes
to workers’ comp benefits under the WSI Act:
Current Rules
Proposed Change
Loss of Earnings benefits
“locked in” after 72 months
even if worker improves and
returns to work
WSIB to review Loss of
Earnings benefits after 72
months
Survivor benefits based on
minimums contained in Act
Survivor benefits based on
average earnings of dead
worker’s occupation or trade
Workers’ Compensation—Disability Benefits
Dec. 1: The following new and revised WSIB policies
on non-work-related disabilities took effect:
77Adjusting Benefits Due to Post-accident, Nonwork-related Change in Circumstances
77Work Reintegration Principles, Concepts, and
Definitions
77Determining Suitable Occupation
77Work Transition Plans.
Pensions
Nov.: Reminder: All pension filings with a prescribed
due date of Jan. 1, 2013 or later must be filed
electronically via FSCO’s Pension Services Portal
(PSP), including Annual Info Returns, Investment
Info Summaries, Pension Benefits Guarantee Fund
Assessment Certificate, Actuarial Info Summary and
Fund Financial Statements.
LAWS & ANNOUNCEMENTS
Human Rights
Oct. 24: As in the rest of Canada, employment discrimination on
the basis of a crime for which a pardon has been granted is illegal in
the Northwest Territories. But in March 2012, the Territories replaced
pardons with “record suspensions,” i.e., the removal of criminal
records of individuals who complete their sentence and demonstrate
that they’ve become law-abiding citizens. Newly tabled Bill 2 revises
the human rights law to deal with the new rules:
77Current law: Can’t discriminate for “conviction for which a
pardon has been granted”
77Bill 2: Can’t discriminate for “conviction that is subject to a
pardon or record suspension.”
Public Health
Sept. 21: Inuit people don’t have the health information they need
to make informed decisions about their personal and mental wellbeing, according to a new personal wellness survey conducted by the
Nunavut government and researchers from McGill and the University
of Toronto. The report affirms the need for urgent government action
in suicide prevention and mental health.
Government Services
Oct. 24: In 2009, the Supreme Court of Canada ordered the territories
to create a plan for providing government services to French speaking
residents. The GNWT released that plan covering delivery of services
to and communication with the Francophone community.
NUNAVUT
NW TerRitories
LAWS & ANNOUNCEMENTS
CASES
Cop Who Raped Co-Worker Grieves Over Not Being Paid
A police officer who was sentenced to 18 months’ prison for sexually
assaulting her co-worker after a holiday party filed a grievance against
the police force for not paying or furnishing her work since the incident.
We’ll let you know how the case turns out [Joe Willie Saunders, Sept.
28, 2012].
November 2012 © Bongarde • www.payrollcomplianceinsider.com
Payroll W Compliance Insider
10
LAWS & ANNOUNCEMENTS
QUÉBEC
Workplace Safety
Oct.: The IRSST released several new safety publications:
77An evaluation of workers exposed to metalworking fluids
77A study on the effect of chemicals on hearing
77A study on cultural barriers and return-to-work
77An assessment of worker exposure to nanoparticles
77First aid training DVD.
Jobs
Nov.: University students have until Jan. 25, 2013 to register for the
Interprovincial Exchange Program which provides 13-week summer
public service jobs to Québec students in their field of study.
Immigration
Nov.: Don’t refrain from hiring new immigrants to Québec
because they’re not bilingual. That’s the message delivered by
a government official to employers in the province. Refusal to
hire applicants unless they speak both French and English is
especially widespread in Montréal. Making hiring dependent
on knowing a language other than French is also a violation of
Section 46 of the province’s Charter of the French language.
Tax Forms
Nov.: New MRQ forms:
77 TP-726.7-V, Capital Gains Deduction on Qualified Property
77 TPZ-1029.8.PS-V, Supplement to Work Premium:
Application for Advance Payments
77 FP-2500.E-V, Request to Amend GST/HST and QST Returns
Filed Online
77 LM-31-V, Preauthorized Debit (PAD) Payment Agreement
Proposal
77 LM-31.A-V, Request for Changes or Cancellation—Payer’s
PAD Agreement
77 TP-750-V, Income Tax Payable by a Trust Resident in
Québec That Carries On a Business in Canada, Outside
Québec, or by a Trust Resident in Canada, Outside Québec,
That Carries On a Business in Québec
77 CO-359.10-T, Déclaration de renseignements concernant les
actions accréditives
77 CO-965.FE, Crédit d’impôt relatif aux frais d’émission
d’actions - Régime d’épargne-actions (REA II)
77 TP-358.0.1-V, Disability Supports Deduction
77 TP-128.F-V, Income Earned by a Trust from the Rental of
Immovable Property
77 TP-776.47-V, Alternative Minimum Tax of a Trust
77 FP-159-V, Notice of Objection (GST/HST)
77 TP-776.42-V, Alternative Minimum Tax
77 VD-358-V, Québec Sales Tax Rebate for Employees and Partners
77 TP-1031.1-V, Election by a Trust to Pay in Installments the
Income Tax Resulting from a Deemed Sale Applicable to
Certain Trusts
77 TP-726.6-V, Cumulative Net Investment Loss
77 TP-78.4-V, Employment Expenses of Salaried Musicians
77 TP-78-V, Employment Expenses of Forestry Workers
77 TP-75.2-V, Employment Expenses of Salaried Tradespeople
77 TP-66-V, Employment Expenses of Transport Employees
77 TP-59-V, Employment Expenses of Salaried Employees and
Employees Who Earn Commissions
77 RL-1.G-V, Guide to Filing the RL-1 Slip: Employment and
Other Income
77 RL-1-T, Relevé 1 - Revenus d’emploi et revenus divers
77 RL-1.M-T, Relevé 1 modifié - Revenus d’emploi et revenus divers
LAWS & ANNOUNCEMENTS, Cont’d
77 RLZ-1.S-V, Summary of Source Deductions and Employer Contributions
77 LM-53-V, Insurable Earnings Under the QPIP and Pensionable Earnings Under
the QPP of a Person Responsible for a Family-Type Resource or an Intermediate
Resource
77 CO-1029.8.36.ES-T, Crédit d’impôt pour la production d’enregistrements sonores
77 RL-16-T, Relevé 16 - Revenus de fiducie
77 RL-2.S-V, RL-2 Summary: Statement of Retirement and Annuity Income
77 RL-27-T, Relevé 27 - Paiements du gouvernement
77 RL-26-T, Relevé 26 - Capital régional et coopératif Desjardins
77 RL-15, Relevé 15 - Montants attribués aux membres d’une société de personnes
77 RL-22-T, Relevé 22 - Revenu d’emploi lié à un régime d’assurance interentreprises
77 RL-19-T, Relevé 19 - Versements anticipés de crédits d’impôt
77 RL-24-T, Relevé 24 - Frais de garde d’enfants
77 RL-3-T, Relevé 3 - Revenus de placement
77 RL-14.S-V, RL-14 Summary: Information Return respecting a Tax Shelter
77 RL-29, Relevé 29 - Rétribution d’une ressource de type familial ou d’une ressource
intermédiaire
77 RL-8T, Relevé 8 - Montant pour études postsecondaires
77 RL-25.S-V, RL-25 Summary: Income from a Profit-Sharing Plan
77 RL-10-T, Relevé 10 - Crédit d’impôt relatif à un fonds de travailleurs
77 RL-6-T, Relevé 6 - Régime québécois d’assurance parentale
77 RL-17-T, Relevé 17 - Rémunération provenant d’un emploi à l’extérieur du Canada
77 RL-2-T, Relevé 2 - Revenus de retraite et rentes
77 RL-20-T, Aide financière à la formation accordée aux travailleurs
77 RL-23.S-V, RL-23 Summary: Recognition of Volunteer Respite Services
77 TP-668.1-V, Taxable Capital Gains of a Trust That Give Entitlement to a
Deduction
77 TPZ-1029.8.F-V, Work Premium Tax Credit: Application for Advance Payments
77 TPZ-1029.8.P-V, Tax Credit for Childcare Expenses: Application for Advance
Payments
77 TP-350.1-V, Calculation of the Deduction for Residents of Designated Remote
Areas
77 TP-1029.8.33.6-V, Tax Credit for an On-the-Job Training Period
77 RL-22.G-V, Guide to Filing the RL-22 Slip – Employment Income Related to
Multi-Employer Insurance Plans
77 RL-5.S-V, RL-5 Summary: Benefits and Indemnities
77 RL-3.S-V, RL-3 Summary: Investment Income
77 RL-7.S-V, RL-7 Summary: Investments in Investment Plan
77 RL-24.S-V, RL-24 Summary: Childcare Expenses
77 RL-18.S-V, RL-18 Summary: Securities Transactions
77 RL-7.G-V, Guide to Filing RL-7 Slip
77 RL-21.S-V, RL-21 Summary: Farm Support Payments
77 RL-22.S-V, RL-22 Summary: Statement of Employment Income Related to a
Multi-Employer Insurance Plan
77 RL-8.S-V, RL-8 Summary: Amount for post-secondary studies
77 RL-3.G-V, Guide to Filing the RL-3 Slip: Investment Income
77 TP-1029.8.61.64-V, Tax Credit for Caregivers
77 LE-34.1.12-V, Reduction of the Contribution to the Health Services Fund on the
Salary or Wages Paid to Employees 65 or Older.
CASES
Employer Must Pay Contractor’s $12K CSST Assessment
A trucking contractor went bankrupt in 2007 and couldn’t pay its CSST
assessment. So the CSST demanded that the fruit wholesaler who hired the
contractor to transport its products pay the $12,746 assessment. The employer
appealed but to no avail. Under article 316 of the Act Respecting Industrial
Accidents & Occupational Diseases, companies are on the hook for the unpaid
CSST assessment of the contractors they hire, the Commission des lésion
professionelles explained [Fruits et legumes G. Bono inc. et CSST, 2012 QCCLP
5668 (CanLII), Sept. 6, 2012].
LAWS & ANNOUNCEMENTS
Workers’ Compensation
Nov.: The WHSCC announced that Newfoundland will keep 2013 average workers’ comp premiums at $2.75 per $100 of assessable payroll—including
a $0.25 surcharge to pay down the injury fund’s deficit—but increase maximum compensable and assessable earnings limits to $54,155.
NL
Privacy
Oct. 15: Newfoundland made some technical changes to its personal health information privacy laws to harmonize requirements with federal PIPEDA
rules. Technically, personal health information collected, used and disclosed in the province will be subject to Newfoundland, rather than federal rules;
the reverse is true of private health information collected, used and disclosed outside the province in connection with Newfoundland commerce.
Public Health
Oct. 4: Newfoundland created a new committee to help the government develop programs to help people with mental illnesses and addictions
overcome barriers and find jobs.
November 2012 © Bongarde • www.payrollcomplianceinsider.com
Payroll WCompliance Insider
11
LAWS & ANNOUNCEMENTS
Workplace Safety—Worker Deaths
Oct. 13: 27 workers were killed on the job in Nova Scotia
in 2011, as compared with only 12 in 2007. And with a
full quarter to go, there have been 18 workplace deaths in
2012. Labour unions cited the Labour Department report as
evidence of a province-wide systemic problem and called for
“a cultural change” to workplace safety.
Workplace Safety
SOct. 17: WorkSafeNB issued a guide to help employers develop a code of
practice to protect their employees from breathing in harmful substances at
work. The guide covers issues like use of respirators, medical testing and
other requirements contained in Sec. 50(2) of the OHS Act.
Workplace Safety—New Laws
Oct.: The government began finalizing changes to OHS
regulations affecting:
77Fall protection and scaffolding
77A new rope access regulation
77Temporary workplace traffic controls
77Administrative transfer of Occupational Health
Regulations to the OHS sphere.
NEW BRUNSWICK
NOVA SCOTIA
LAWS & ANNOUNCEMENTS
Human Rights
Oct.: The Human Rights Commission will hold a one-day
workshop for employers in Halifax on Jan. 23, 2013. Cost:
$150 per person. Go to the Commission’s website to find
out more.
Prison Guard Gets Workers’ Comp for Mental Stress
Breaking up a knife fight between inmates left a prison guard so shook
up that he began seeing a psychologist for post-traumatic stress. Workers’
comp denied his claim but the Appeals Tribunal said his psychological
injury—gradual onset stress—was covered because it was the result of a
work “accident,” citing the guard’s exposure to riots, fights, fires and other
disturbing events, of which the knife fight was the last straw [20126628
(Re), [2012] CanLII 56052 (NB WHSCC), Sept. 21, 2012].
Jobs
Oct. 26: START, a $3.5 million jobs program that helps,
was launched in Bridgewater. START offers Nova Scotia
employers incentives to hire and train young workers, recent
graduates, new apprentices and older workers who’ve been
unemployed for a long time.
LAWS & ANNOUNCEMENTS
CASES
PRINCE EWARD ISLAND
Workers’ Compensation
Oct. 9: PEI proposed cutting its 2013 average assessment rates a
penny to $1.98 per $100 of assessable payroll.
HST
Nov.: The government proposed rules covering PEI’s transition
from the GST to HST which will apply to goods and services
starting April 1, 2013. The proposals address:
77If the GST and PST, or the HST, applies for transactions
that begin April 1, 2013 but end at a later date
77What businesses must do to conclude the PST system
77Industry- or business-specific rules for the transition
period.
Workplace Safety
Jan. 31: Reminder: Changes to PEI workplace first aid regulations
take effect. The changes apply to first aid kits, provider
qualifications, first aid rooms and records of first aid treatment.
Minimum Wage
Dec. 1: Saskatchewan’s minimum wage increases 50¢ to $10.00 per hour.
Minimum call-out pay also rises to $30.00.
SASKATCHEWAN
LAWS & ANNOUNCEMENTS
CASES
No Workers’ Comp to Employee Who Rejects Return-to-Work Plan
A postal worker who underwent back surgery after slipping on ice refused
to participate in his employer’s return-to-work plan because it required
him to drive to a mail sorting facility. The workers’ comp board cut off his
benefits and the court upheld the decision, finding that the employer had
made a reasonable attempt to accommodate him and there was no medical
reason that he couldn’t follow the RTW plan [Sanford v. New Brunswick
(Workplace Health, Safety and Compensation Commission), [2012] N.B.J.
No. 362, Oct. 18, 2012].
Workers’ Compensation
Nov. 13: Nova Scotia’s labour minister rejected requests from
about 100 injured workers for a royal commission into the
province’s workers’ comp system, saying it would be costly
and complex. The workers claim the system is “broken,”
arguing that it takes too long for workers to get benefits and,
when they do, they don’t cover expenses.
Is Confrontation with Manager Cause of Worker’s
Mental Injury?
Yes it was, said the Workers’ Comp Appeal tribunal. Although
not proved to a “scientific certainty,” there was enough
evidence to show that his PTSD (post-traumatic syndrome
disorder) was the result of an acute reaction to a traumatic
event—being hollered at and physically confronted by his
manager. As a result, it was a work-related injury covered by
workers’ comp [2012-438-AD (Re), [2012] CanLII 61862 (NS
WCAT), Oct. 18, 2012].
Workers’ Compensation
Oct. 18: Good news for about 13,500 New Brunswick employers: workers’
comp rates are either going down or remaining the same. That’s because
WorkSafeNB is cutting 2013 workers’ comp average assessments15% from
$1.70 to $1.44 per $100 of payroll. The minimum assessment rate will remain
$0.28 per $100.
Workers’ Compensation—Rates
Oct. 15: For the sixth straight year, Saskatchewan is lowering workers’ comp
rates. The WCB proposed dropping 2013 average premiums 1.25% to $1.58
per $100 of payroll, lowest in 20 years.
Workers’ Compensation—New Laws
Nov. 14: The government proposed changes to the Workers’ Compensation
Act. Highlights:
77 Increase maximum insurable earnings and maximum wage rate
77 New indexation system to adjust benefits annually
77 Let workers elect to receive benefits as annuity or lump sum upon
reaching age 65
77 WCB authority to impose administrative monetary penalties for safety
violations
77 New indexation formula based on increases to average weekly wage.
Workplace Safety
Nov. 7: Saskatchewan is getting ready to propose new safety protections for
employees of late-night retail establishments who handle cash. Meanwhile,
after delays, the changes to the OHS Act contained in what was once Bill 23
finally took effect. Highlights:
77 Tickets for summary offences
77 Increases in OHS penalties
77 Required designation of prime contractor to coordinate safety at multiple
employer sites.
Labour Standards
Nov.: Highlights of a busy month in Sask. labour standards law in Oct. 2012:
77 In throne speech, government says it will introduce sweeping new
employment law
77 300 more apprentice positions to be added
77 Grill House Café fined $400 for not providing payroll and employment
records demanded by Labour Standards Officer
77 Impact Security Group fined $1,290 for not paying employees final wages
and annual holiday pay within 14 days of termination.
November 2012 © Bongarde • www.payrollcomplianceinsider.com
Payroll W Compliance Insider
12
WINNERS & LOSERS
Can Employees Waive their Right to Termination Notice?
Employment standards laws set minimum notice employees must receive when they’re terminated without just cause. But even before ESA laws,
employees were allowed to collect “common law” notice, i.e., notice awarded on the basis of precedents from court cases rather than a statute.
And common law notice is more generous than ESA notice. Unlike ESA notice, common law notice can be waived. Consequently, employers
may include language in employment contracts purporting to waive common law notice and limiting the employee to ESA notice in the event of
termination. The following cases illustrate the factors courts and arbitrators consider in deciding whether to enforce such waivers.
WAIVER IS VALID
WAIVER IS INVALID
FACTS
A pharmaceutical company fires a clinical research manager without
cause. The employment contract stipulates that the manager is entitled
to “notice or severance . . . as required pursuant to the provisions of”
the BC ESA. So the company offers the manager the 5 weeks’ notice
to which she’s entitled under the law for her 4 years of service. The
manager sues, claiming that the notice provided in the contract is just a
minimum and doesn’t preclude her from seeking common law damages.
DECISION
The BC Provincial Court rules that the manager waived her rights to
common law notice and throws out the case.
EXPLANATION
Historically, courts have been very strict in interpreting agreements
purporting to limit an employee’s notice rights. The slightest ambiguity
is enough to make the waiver unenforceable. But the language in this
contract was clear and express, the court found. A waiver is also
unenforceable if it’s “unconscionable,” i.e., so grossly unfair that it
shocks the conscience. One way a waiver can be unconscionable is
when an employer takes advantage of an employee’s ignorance to get
it signed. In this case, the manager didn’t appreciate the significance of
the provision when she signed it. But she was given the opportunity to
ask questions or ask a lawyer for advice and chose not to. As a result,
the waiver wasn’t unconscionable. W
van’t Slot v. OncoGenex Technologies Inc., [2010] BCPC 249 (CanLII),
Sep. 23, 2010
FACTS
An employee, hired by his Ontario employer in 1978 is dismissed
without cause in 1985. The contract states the employee is entitled
to zero weeks of notice, even for termination without cause. Under
the Ontario ESA, the employee is entitled to a minimum of 4 weeks’
notice. On termination, the employer pays the notice required under
the Ontario ESA. The employee sues for wrongful dismissal.
DECISION
The Supreme Court of Canada sets aside the employment contract
provisions and grants the employee 7 months’ notice under common law.
EXPLANATION
The provision of the contract providing less termination notice than
required under the ESA was void, said the Court. ESA notice is the
absolute minimum. And under common law, when the employment
contract doesn’t have a valid notice provision, it’s up to the courts to
step and decide what termination notice is reasonable. In deciding
reasonable notice, the courts aren’t limited to the ESA but can provide
more generous notice under the common law. Result: The employee
got more than the minimum ESA notice. W
Machtinger v. HOJ Industries Ltd., [1992] SCR 986 (CanLII), Apr. 30, 1992.
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