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Cost of doing Business

The 2008 Competitive Alternatives study by KPMG shows that the costs of doing business for a non-sector-specific manufacturing company are lower in the Windsor-Essex Region than for several larger nearby communities, based on a 10-year average of annual location-sensitive costs.

10-Year Average Annual Location-Sensitive Costs

Manufacturing Industry Average ($000s USD)

Source: KPMG 2008 Competitive Alternatives

Basic Costs for Ontario Employers

Source: Canada Revenue Agency; Workplace Safety and Insurance Board; Employment Standards Branch, Ministry of Labour; Ministry of Finance; Statistics Canada; AON Consulting (6/2008)

NOTES: Common Practice of Employers for group insurance varies by industry sector.

Canada Pension Plan (CPP)

• The calculation of contributions is based upon earnings.
• An employer is required to withhold and remit an amount on the employee's behalf based upon a percentage of the employee's contributory earnings up to an annual maximum.
• Maximum annual contributory earnings for 2008: Cdn $44,900.00.

Source: Canada Revenue Agency (5/2008) URL: www.cra-arc.gc.ca/menu-e.html

Employment Insurance

• The calculation of contributions is based upon a percentage of insurable earnings.
• An employer is required to withhold and remit an amount on the employee's behalf based upon a percentage of the employee's insurable earnings up to an annual maximum.
• Maximum annual insurable earnings for 2008: Cdn $41,100.00.

Workplace Safety and Insurance Board (WSIB)

• The calculation of the amount the employer must contribute is based upon the employer's industry and the amount of payroll.
• Based upon the industry that an employer is in, an employer will be assigned a certain premium rate, which is the dollar value that must be contributed per $100.00 of payroll.
• The 2008 average premium rate is Cdn $2.26 for every Cdn $100.00 of insurable earnings.

Source: Workplace Safety and Insurance Board (6/2008)

Employer Health Tax

• The amount of tax payable by an employer for the year is equal to the "taxable total Ontario remuneration" paid by the employer, multiplied by a particular rate based on the total annual Ontario remuneration.
• The "taxable total Ontario remuneration" is the amount by which the total Ontario remuneration paid by the employer during the year exceeds the employer's exemption amount for the year. For the year 2008 the exemption amount is Cdn $400,000.00.

Vacation Pay

• When employees are on annual vacation, the employer pays them at least 4% of the wages they earned during the 12 months the vacation was earned.
• Vacation pay is calculated only on an employee's earned wages during those 12 months unless you have a better vacation plan than the minimum standard in the Act.
• If a worker's employment ends before they take their vacation, you must pay them all of their vacation pay no later than seven (7) days after their employment ends.

Source: Ministry of Labour (6/2008)

Public Holidays

• The purpose of a public holiday is to provide employees with a paid day off
• Ontario has nine paid public holidays:
• New Year's Day
• Family Day
• Good Friday
• Victoria Day
• Canada Day
• Labour Day
• Thanksgiving Day
• Christmas Day
• Boxing Day (December 26th)
• If you have employees who qualify for paid public holidays, they are entitled to these days off and you are required to pay them for the day
• Common Practice (12 days) assumes the industry allows the following as Public Holidays, however these are not required under the Employment Standards Act
• Easter Sunday
• Easter Monday
• First Monday in August
• Remembrance Day (not typically included)

Source: Ministry of Labour (6/2008)