Processing payroll is more than just calculating employment income. Each province has their own specific set of regulations, which may make the task seem a little more daunting. This guide will help familiarize you with the Northwest Territories’ specific payroll regulations such as what your employees are entitled to, what remittances to make, how termination works and more.
Minimum Wage Northwest Territories
The minimum wage in NWT was increased on September 1, 2021 from $13.46 per hour to $15.20 per hour. This applies to people ages 16 years and older.
Hours of Work
- Maximum hours worked: 10 hours per day and 60 hours per week.
- Overtime: 8 hours per day or 40 hours per week, whichever is greater
- Overtime rate: 1 and 1/2 times the employee's regular pay rate
- Double Time: If an employee works on another day of rest in same week as the Statutory holiday
- Double Time Rate: 2 x regular rate of pay
- Break period: 1/2 hour per consecutive 5 hours worked
- Rest period: At least 24 consecutive hours/week
Workers Compensation Northwest Territories
The Workers’ Safety and Compensation Commission, or WSCC for short, asserts that all employers must report payroll figures and Occupational Health and Safety information annually to their organization. The WCSS uses the estimated payroll figures supplied by employers to calculate the amount of assessment each employer will pay in the current year. Should the employer become aware that the estimates are no longer accurate, they can revise their figures at any time during the year.
Once employers report their actual payroll amounts WSCC will compare the estimates to the actual figures. Should employers underestimate their actual payroll by 25% or more, then a penalty is applied. At the same time, employers must file their Annual Payroll Report by February 28th every year. A package is mailed to all employers within the Northwest Territories which must be completed and submitted. If employers fail to meet the deadline, a penalty is applied.
To submit the Annual Payroll Report, employers can use the WSCC Connect portal and click on Payroll, and then Report or Revise Payroll. If you do not have a WSCC account, then you can submit the report through the Fast File Reporting option.
NWT Payroll Tax Deductions and Remittances
If you have a business in the NWT and pay remuneration to an employee including any taxable benefits, you are required to register for payroll tax with the Treasury Division of the GNWT Department of Finance. After registering, you will be assigned a reporting period in which you will remit the payroll tax you collected from employees.
The type of income subject to payroll taxes include the following:
- Wages and salaries, bonuses and gratuities
- Employee stock options
- Vacation travel assistance
- The value of benefits and allowances taxable under the Federal Income Tax Act
- Contributions made by employers to registered retirement savings plans (RRSP)
- Severance pay and retiring allowances
Even though employees pay the tax on retiring allowances, it is the responsibility of the employer to withhold the tax from employees’ pay and remit the tax to the Government of the Northwest Territories. The NWT payroll tax can be found on employees’ pay stubs as a deduction from gross pay.
In reference to retirement, the payroll tax applied to the employment income includes:
- Contributions made by the employers to registered retirement savings plans (RRSP)
- Severance pay or retiring allowances
Items that are exempt from payroll tax include:
- Pension, annuity or superannuation benefits received after retirement
Northwest Territories Pay Statements
It is important to know how to pay your employees while abiding by provincial government regulations. In the Northwest Territories’ employers need to pay their employees on a monthly schedule or more frequently and the employee must receive their pay within ten days after each pay period.
Employees are categorized into three main groups regulating pay statements: permanent employees, casual employees, and teachers.
Here is a list of what items are required to appear on the paycheque:
- Rate of pay
- Net pay
- Dates of pay periods
- Itemized Deductions
- Bonus, living allowance
- Statutory, public, general and holiday pay hours
- Total hours worked
Leave of Absence in NWT
Vacation pay NWT
- Under 90 days of employment: No notice required
- Between 90 days and 3 years of employment: 2 weeks notice
- 3 years for more of employment: For every year after 3 years an additional week of notice is required, up to 8 weeks in total.
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