Employees or Contractors? Staffing Your Canadian Business
There are two methods to collaborate with people in Canada: employing them, or closing contracts based on given projects.
If you employ people, you should follow all the rules regarding employees, close a contract with them and pay the tax to the government. Otherwise, your employees may sue you and it may result in legal consequences. Be aware of the laws regarding the income and payroll of an employee, and consider statutory deductions such as retirement, insurance and medical cases.
It is easier to work with contractors, and there will not be any of such problems. In the primary research, make it clear in which sectors you need to hire employees and in which ones you can outsource the affairs.
Be aware of the circumstantial issues related to hiring an employee. Then use these considerations and hire the best candidate.
Big corporations have their own lawyers, but small ones can use lawyer counseling in some instances when required. A small business does not need a full legal department, but it does need to know when to ask.
This choice also connects to your business plan. When you write the list of the people you need, mark which positions are permanent employees and which tasks can be given to experts on a project basis. Remember that you cannot do everything by yourself. You should use counseling and help from expert groups, and even outsource some of the work.
Some practical examples show how flexible this can be. A corporation does not have to own a van or a truck, and it can hire and use them for service providing. Renting cars and trucks for transportation is common in Canada. Any corporation can first find customers and then rent a truck. For example, they receive 1500 dollars for transportation services, then they rent a truck for 200 dollars and pay almost 500 dollars to each worker, and eventually they end up with something around 800 dollars.
Think carefully before adding people to the payroll. Decide which work must be done inside your company, which can be contracted, and follow the rules for each.