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INTRODUCTION TO CANADIAN PAYROLL
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Payroll is a necessary function in every organization that has employees, 
as each employee expects to be paid for the work they perform. While the 
amount of maximum remuneration that an employee receives for their work is 
not legislated by any government (unless the employee is a federal or 
provincial/territorial civil servant), there is legislation in place at
both the federal and provincial/territorial levels that governs many 
aspects of processing employees' pay, their taxable benefits and observing 
their rights as employees.

t is important to note that this course deals with payroll, the function of paying employees
for work performed for employers. Self-employed workers or contractors, who submit
invoices for the work they perform and receive payment through accounts payable and not
payroll, are not employees.

Both the federal and the Québec governments provide factors that can be used to determine
whether an employee-employer relationship exists. It is crucial to know how to determine the
type of relationship that exists between the worker and the organization and to ensure that
any payments made comply with legislation.

Payroll Objectives and Definitions
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The **primary objective of the payroll function** in every organization is to 
pay employees accurately and on time, in compliance with legislative 
requirements, for a full annual payroll cycle.

Every employee expects to receive their pay on the day it is due in the 
manner arranged with their employer, either by cheque or direct deposit. 
In addition to ensuring that employees have been paid, payroll 
practitioners must also be able to communicate payroll information to
all stakeholders.

- **Payroll** is the process of paying employees in exchange for the services 
they perform.

- **Legislation** refers to laws enacted by a legislative body. In Canada 
there are many legislative sources that payroll practitioners must comply 
with at two separate levels ─ the federal and the provincial/territorial 
governments. Later in the chapter we will explore the compliance
requirements for the various pieces of legislation from these sources.

- **Compliance** is the observance of official requirements. For payroll 
practitioners, this means performing payroll functions according to 
federal and provincial/territorial legislative and non-governmental 
stakeholder requirements.

The legislative requirements are termed **statutory**. This means they are 
enacted, created, or regulated by statute, a law enacted by the legislative 
branch of a government. Fines and penalties can be imposed if an organization 
is not in compliance with the legislative requirements in each jurisdiction.

When dealing with federal and provincial/territorial government agencies, 
payroll administrator must know the many pieces of legislation that 
regulate their work and the compliance requirements associated with each. 
Payroll administrators are responsible for ensuring their organization is 
compliant with all payroll related legislation, thus eliminating the 
potential for any fines or penalties.

In payroll, there are also compliance requirements from other non-government stakeholders,
for example, union collective agreements or group insurance policies. Payroll administrator
must therefore ensure the organization is compliant with all stakeholder requirements.