Saliem Talash: Hiring your first employee in Ontario, step by step

The first hire is the moment a one-person business becomes an employer, and the paperwork arrives all at once. Most of it is not hard. It is unfamiliar, spread across federal and provincial websites, and full of easy-to-miss deadlines.

I'm Saliem Talash, and I build practical tools for small businesses in Toronto. This post puts the official requirements for a first employee in Ontario in the order you will meet them. Every number comes from the Canada Revenue Agency (CRA), Employment and Social Development Canada, the Government of Ontario or the WSIB, read in October 2026. It is a starting map, not tax or legal advice, and an accountant or bookkeeper is worth an hour of your time before the first payday.

Step 1: get a payroll account with the CRA

You deduct and send money to the CRA on your employee's behalf, so you need a payroll deductions account. The CRA describes the number as a "15-character payroll deductions account number": your nine-digit business number, then the letters RP, then a four-digit reference, for example 123456789RP0001.

The payroll account sits under your business number. Set it up before your first payday, so the deductions you take off the first paycheque have somewhere to go.

Step 2: check whether you must register with the WSIB

The Workplace Safety and Insurance Board (WSIB) is Ontario's workplace insurance system. Its registration page says that "most Ontario businesses that have employees (including family members and sub-contractors) must register with us," and lists industries such as construction, restaurants and bars, sales and services, agriculture, manufacturing and trucking.

The deadline is short: "You have 10 calendar days to register with us from the day you hire your first employee." Some industries are optional, so check your own on the WSIB site rather than assuming either way.

Step 3: pay at least the minimum wage

Ontario's general minimum wage changed today, October 1, 2026. The province lists $17.60 per hour for October 1, 2025 to September 30, 2026, and $17.95 per hour from October 1, 2026 to September 30, 2027. The rate is tied to the Ontario Consumer Price Index and changes each October.

The student rate, for students under 18 who work 28 hours a week or less while school is in session, is $16.90 from the same date. If a pay period straddles a change, the province says the period is split and each part must meet the rate in force at the time.

Step 4: work out each paycheque's deductions

From every paycheque you hold back three things and add your own share of two of them.

Canada Pension Plan (CPP). For 2026 the CRA lists a rate of 5.95% each for the employee and the employer, on earnings up to $74,600, with a basic exemption of $3,500. The maximum is $4,230.45 each.

The second CPP contribution (CPP2). On earnings between $74,600 and $85,000, a further 4% each applies, to a maximum of $416 each.

Employment Insurance (EI). For 2026, outside Quebec, the employee rate is 1.63% of insurable earnings up to $68,900, a maximum of $1,123.07. The CRA says "the employer's premium will be 1.4 times this amount," a maximum of $1,572.30.

Income tax. Federal and Ontario income tax, which depends on the employee's pay.

You do not have to do this by hand. The CRA's Payroll Deductions Online Calculator (PDOC) works out "federal, provincial (except for Quebec), and territorial payroll deductions" for a given pay. It is free, and a good way to check a payroll app's numbers on the first run.

Step 5: send the deductions on time

What you withhold is not yours, and the CRA treats the due date seriously. For most new employers, called regular remitters, the CRA's rule is: "Your remittance due date is the 15th day of the next month." If that falls on a weekend or a public holiday, a payment received or processed on the next business day counts as on time.

Some new small employers can remit quarterly instead (April 15, July 15, October 15 and January 15), but only if they meet the CRA's conditions, which include withholding less than $1,000 a month and a perfect compliance record. Plan on monthly until you know you qualify.

Step 6: give the employee what Ontario requires

Ontario's Employment Standards Act sets the floor for everything else:

  • The poster. Employers must give each employee "a copy of the most recent version of the poster within 30 days of the person becoming an employee." The poster is the province's summary of workplace rights.
  • Written job information. Since July 1, 2025, employers with 25 or more employees must give certain information in writing before the first day, including the wage rate, pay period and pay day, and anticipated hours. A smaller business is not covered by that rule, but writing the same details down is a good idea anyway. It prevents the first misunderstanding.
  • Vacation. Employees earn "two weeks of vacation time after each 12-month vacation entitlement year," rising to three weeks after five years, and vacation pay of "at least four per cent of the gross wages," or six per cent after five years.
  • Public holidays. "Ontario has nine public holidays": New Year's Day, Family Day, Good Friday, Victoria Day, Canada Day, Labour Day, Thanksgiving Day, Christmas Day and Boxing Day. The August Civic Holiday, Easter Monday and Remembrance Day are not among them.

Step 7: know the paperwork that comes later

Two documents arrive after the first months, and both have firm dates.

T4 slips. Each year you report what you paid and deducted. The CRA says "the filing due date is the last day of February after the preceding calendar year."

Records of Employment (ROE). When an employee stops working, even temporarily, you issue an ROE. Service Canada's guide says one is needed "each time an employee experiences an interruption of earnings," which includes seven consecutive calendar days with no work and no insurable earnings. Electronic ROEs are due five calendar days after the end of the pay period in which the interruption happens, and ROE Web lets you create and submit them online.

A one-page checklist

  1. Payroll account (RP) with the CRA, before the first payday.
  2. WSIB registration within 10 calendar days of hiring, if your industry requires it.
  3. Pay at or above $17.95 an hour (general rate, from October 1, 2026).
  4. CPP, CPP2, EI and income tax worked out with PDOC or payroll software.
  5. Remittances by the 15th of the following month.
  6. The Employment Standards poster within 30 days.
  7. Vacation and public holiday pay tracked from day one.
  8. T4s by the end of February; ROEs whenever earnings stop.

I keep templates for this kind of routine on my site, and longer explainers on ZELR.

Sources

  • Government of Ontario: Your guide to the Employment Standards Act, Minimum wage
  • Government of Ontario: Your guide to the Employment Standards Act, Vacation
  • Government of Ontario: Your guide to the Employment Standards Act, Public holidays
  • Government of Ontario: Your guide to the Employment Standards Act, Mandatory information for employees
  • WSIB: Do you need to register with us
  • Canada Revenue Agency: What is a payroll deductions account
  • Canada Revenue Agency: CPP contribution rates, maximums and exemptions
  • Canada Revenue Agency: Second additional CPP contribution rates and maximums
  • Canada Revenue Agency: EI premium rates and maximums
  • Canada Revenue Agency: When to remit (pay) source deductions
  • Canada Revenue Agency: When to file T4 information returns
  • Employment and Social Development Canada: How to complete the record of employment (ROE) form
  • Canada Revenue Agency: Payroll Deductions Online Calculator

Drafted with AI assistance.

More from Saliem Talash: saliemtalash.vercel.app · ZELR · YouTube

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