Alan McEwen
Recently, one of our subscribers was wondering how to deal with payroll deductions relating to long-term disability (LTD) premiums. They wanted to know if the amount they deduct from the employee’s paycheque must include the Ontario sales tax on the LTD premium?
The answer is yes; the amount that you have to deduct from employees includes Ontario Retail Sales Tax (RST) at eight percent on any share of LTD premiums that they pay.
Note, however, that RST only applies to the amount of any employee premiums paid by Ontario residents. In other words, there is no RST on the employee portion of LTD premiums paid by a person who is not an Ontario resident, but whose province of employment is Ontario. Because of this rule, there might also be situations where the employer portion of the LTD premium is subject to RST, but the employee portion is not.
Generally, where LTD coverage is provided through an insurance company, the monthly billings from that carrier should show which premiums are subject to RST and which are not.
Alan R. McEwen
Alan McEwen & Associates
This year’s Ontario Employment Law Conference co-sponsored by First Reference and Stringer Brisbin Humphrey on June 2, 2010, will touch on several topics of importance to employers. The first topic on the Agenda will provide employers with guidance on a significant court decision and changes in court procedures affecting the termination process. Specifically it should help employers minimize claims arising from the termination process.
Marie-Yosie Saint-Cyr, LL.B. Managing Editor
I just read a Statistics Canada report stating that the gender wage gap has recently been decreasing. The report briefly noted that between 1988 and 2008, the wage gap narrowed throughout the wage distribution. However, the gap shrank the most at the lowest end of the wage distribution, and the gap shrank the least at the upper end. Also, although women dramatically increased their representation in high-wage occupations such as management, there were still significant gender wage gaps within these occupations.
Christina Catenacci, BA, LLB, LLM, PhD
I’ve been doing some reading to see what salary increases are predicted for the year 2012, and whether things will be more optimistic for Canadian employees who work hard to make ends meet. It turns out that most are projecting a marginal increase from last year, when employees also received marginal increases; that is, lower than the increases prior to the economic downturn.
Christina Catenacci, BA, LLB, LLM, PhD