Determine Your Requirements

Employee or Independent Contractor

The first step towards hiring is to determine if the person will be hired as an Employee or as an Independent Contractor.

What is the Difference and who Decides?

The Canada Revenue Agency rules determines who must be paid as an employee and who can be paid as an independent contractor. In addition, university policies must be complied with to support these relationships. How people are paid are affected by the Canada Pension Plan Act the Employment Insurance Act, and the Income Tax Act.

The facts of the relationship determine whether the relationship is that of an employee or an independent contractor. The key points to consider in determining the relationship are control, tools and equipment and financial risk.

The type of relationship must be determined before any work commences and the hirer must also ensure prior to hiring that the person meets the requirements for this type of relationship with the University.

Employee, (employer-employee relationship) the payer is considered an employer. Employers are responsible for deducting Canada Pension Plan (CPP) contributions, Employment Insurance premiums, and income tax from remuneration or other amounts they pay to their employees.

Independent Contractor, the worker is a self-employed individual (business relationship), he or she is considered to have a business, no deduction are taken at source.

If you already know the type of relationship please proceed to hiring an employee or hiring and independent contractor.

If you are unsure of the relationship please contact Human Resources or Financial Services.