Hiring your first employee—or your tenth—is a big step. It means your business is growing, and with growth comes responsibility. Whether you’re bringing on staff, working with contractors, or managing a team, understanding your legal obligations and having the right tools in place is essential.

This guide breaks down what you need to know about hiring employees, working with independent contractors, and managing your team effectively and legally.

Hiring Employees

Before you post that job ad, make sure you understand your responsibilities under the Employment Standards Act (ESA). This legislation outlines everything from minimum wage to vacation pay and termination rules.

Here’s a simple hiring checklist:

  1. Define your hiring needs and write a clear job description.
  2. Post the job and attract qualified candidates.
  3. Interview and shortlist applicants.
  4. Hire the best fit and provide onboarding and training.
  5. Use employment agencies if needed—they can help avoid costly hiring mistakes.

Pro Tip: Always have a job description, employment contract, and an employee handbook ready. These documents set expectations and protect both you and your team.

Employer Obligations

Employees typically have a long-term, exclusive relationship with your business. If you’re looking for consistency and reliability, hiring full-time or part-time staff is the way to go.

Types of Employees:

  • Indefinite: No set end date
  • Fixed-term: Specific start and end dates

As an employer, you must:

  • Pay minimum wage, overtime, vacation, and public holiday pay
  • Follow rules around hours of work and breaks
  • Deduct and remit CPP, EI, and income tax to the CRA
  • Provide notice and severance when required

Set up your CRA payroll account to handle deductions and remittances.

Working with Independent Contractors

Need short-term expertise or project-based support? Hiring an independent contractor might be the right move.

Key differences from employees:

  • Contractors control how, when, and where they work
  • They use their own equipment
  • They invoice you for completed work
  • You don’t deduct taxes or provide benefits
  • You’re not responsible for severance or notice (unless stated in the contract)

CRA Guide: Employee or Self-Employed

HR Tools & Resources

Here’s a curated list of resources to help you stay compliant and manage your team effectively:

When Employees Leave

You’re responsible for:

  • Issuing Records of Employment (ROE)
  • Conducting exit interviews
  • Meeting notice and severance obligations

Managing & Training Staff

Strong teams don’t just happen—they’re built. Invest in:

  • Performance management systems
  • Training and development
  • Teleworking policies
  • Support during challenging times

Need Help?

BACD offers free advisory meetings to help you navigate HR, hiring, and compliance. Book a session by emailing bacd@durham.ca or calling (905) 668-4949.