Article
4 min read
Employer Costs for an Employee in Canada (2026 Guide)
Employer of record
Global hiring
Author
Jemima Owen-Jones
Last Update
February 03, 2026
Quick answer: What is the total employer cost for a $100,000 salary in Canada?
For an employee earning $100,000 USD annually in Canada, employers can expect mandatory employer costs of approximately $5,786 USD per year, bringing total compensation costs to $105,786 USD.
Estimated total employer cost (Canada): ~5.8% on top of gross salary (example estimate).
Hiring in Canada can be a great way to access top talent—whether you’re expanding into North America, building a remote team, or hiring your ideal candidate locally.
But even when two employees earn the same salary, the total employer cost can vary by country due to different statutory contributions, payroll rules, and regional requirements.
This guide provides a ballpark estimate of the mandatory employer cost of hiring an employee in Canada, using an example salary of $100,000 USD per year.
What’s included in this estimate?
This estimate includes mandatory employer-side statutory costs that may apply when hiring an employee in Canada, such as:
- Provincial employer health tax (EHT) (varies by region)
- Canada Pension Plan (CPP) employer contribution
- Employment Insurance (EI) employer contribution
What’s not included in this estimate?
This estimate generally does not include additional costs such as:
- Paid time off (vacation leave)
- Sick pay
- Private health insurance
- Employer-provided benefits or allowances
- Bonuses, equity, or commissions
- Equipment and onboarding expenses
- Costs tied to province-specific rules beyond EHT
- Optional retirement or supplemental benefits
Why employer costs vary in Canada (and globally)
Employer costs can differ depending on:
- Province-specific payroll taxes and requirements
- Income thresholds and contribution caps (CPP and EI)
- Industry-specific obligations
- Changes in regulation year to year
- Currency exchange rate fluctuations (if you pay in a different base currency)
Estimated employer cost breakdown for Canada
Below is an estimated breakdown of mandatory employer costs for hiring an employee in Canada earning $100,000 USD/year.
Example salary used in this estimate
- Annual gross salary: $100,000 USD
- Annual gross salary (approx.): $144,480 CAD
Employer mandatory costs (estimated)
| Employer Cost Category | Estimated Annual Cost (CAD) | Estimated Annual Cost (USD) | Notes |
|---|---|---|---|
| Canada – EHT | $2,817 | $1,950 | Provincial employer health tax (varies by region) |
| Canadian Pension Plan (CPP)* | $4,034 | $2,792 | Employer contribution (subject to annual limits) |
| Canada Employment Insurance (EI) | $1,508 | $1,044 | Employer contribution toward EI program |
| Total Estimated Employer Costs | $8,359 | $5,786 | Total mandatory employer cost estimate |
Total compensation cost (salary + mandatory employer costs)
| Total | CAD | USD |
|---|---|---|
| Gross Salary | $144,480 | $100,000 |
| Mandatory Employer Costs | $8,359 | $5,786 |
| Total Compensation Cost | $152,839 | $105,786 |
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FAQs
How much does an employee cost beyond salary in Canada?
Employer costs in Canada commonly include CPP, EI, and provincial payroll taxes, which can add several percentage points on top of gross salary depending on the province and the employee’s earnings.
Are employer costs the same across Canada?
No. Some employer costs vary by province, especially employer health taxes like EHT, which can change based on region and payroll size.
Do exchange rates affect employer cost estimates?
Yes. If you pay salary in a currency other than CAD, the total cost may shift month to month due to FX changes.
Jemima is a nomadic writer, journalist, and digital marketer with a decade of experience crafting compelling B2B content for a global audience. She is a strong advocate for equal opportunities and is dedicated to shaping the future of work. At Deel, she specializes in thought-leadership content covering global mobility, cross-border compliance, and workplace culture topics.
