When running a small business it is important that you are aware of all the documentation that you and your employees need. Forms like Record of Employment (ROE) is mandatory for all workers in Canada.
Learn more about ROE, and how and when you’re supposed to file one.
A Record of Employment (ROE) is a form that employers complete for employees for the Employment Insurance (EI) Program. Even if the employee does not intend to apply to EI benefits, the ROE must still be completed and submitted to Service Canada.
A ROE is an important document that all employers must fill out when one of their employees, with insurable earnings, has an interruption or stops receiving income. This document determines if an employee qualifies for Employment Insurance (EI) benefits. Service Canada uses his employment document to determine if the employee is entitled to EI payments, the duration of payouts, as well as the amount they are to receive.
The ROE should be completed whenever the employee experiences an interruption of earnings, however, these earnings must be insurable earnings. Insurable earnings are the compensation provided to employees on which EI premiums are paid. EI premiums are part of the statutory deductions made on each paycheque along with other applicable statutory deductions such as Canada Pension Plan (CPP) and federal income tax.
Interruption of earnings occurs whenever an employee receives no insurable earnings for seven consecutive days (note: this does not apply to employees with non-standard work schedules). As such, an interruption of earnings generally occurs whenever an employee is laid off, resigned, or terminated from his or her employment.
Another situation is when an employee’s salary falls below 60% of his or her regular weekly earnings due to illness, injury, pregnancy, or the need to care for a gravely ill child or family member.
Since an employee may still return to work or remain an employee of the employer despite having experienced an interruption of earnings, it may be possible that throughout the employee’s career with the employer, numerous ROEs will be issued.
For example, a female employee who has had several maternity leaves may have more than one ROE with the same employer.
There are also special situations when ROEs must be issued. For example, when the business or organization changes its pay period type, an ROE must be issued for all employees even though the employees are not experiencing an interruption of earnings.
Also, if there is a change in ownership, the former employer usually has to issue ROEs to all employees unless there has been no actual break in employees’ earnings during the change-over, and if the new employer agrees to issue a single ROE that covers both periods of employment should the need arise.
For a more complete list of the special situations of when a ROE should be issued, please refer to the ROE Guide on the Service Canada website.
An ROE may be issued by paper or electronically to Service Canada. Depending on the method chosen, the deadline for filing is different. If a ROE is issued in paper form, the original copy (Part I) must be given to the employee.
Part II of the ROE must then be issued to Service Canada within five calendar days of the first day of an interruption of earnings (the last day paid) or the day the employer becomes aware of an interruption of earnings. The employer has an obligation to keep Part III of the ROE, as well as the payroll records relating to the information, for six years after the year it has been issued.
When the ROE is submitted electronically, the data is transmitted directly to Service Canada’s database, where it is used to process EI claims. The employer must issue the ROE within either:
If for any reason, the ROE is incorrect, or due to a subsequent settlement between the employer and employee, the ROE may need to be updated accordingly. In that case, the employer may issue an amended ROE to Service Canada. Once again, the amended ROE may be submitted either in paper form or electronically.
This article is only scratching on the surface of when and how to properly issue a ROE. It is always a good idea to visit Service Canada’s website for a more complete picture of when and how ROEs are issued, as well as for any updated information or changes in procedure.
Through QuickBooks + Payroll you can file your ROE directly from QuickBooks Online. Using your payroll information, the Payroll feature allows you to process, review, and use EFILE to submit your ROE.
The ROE in QuickBooks is similar to the form filled out through Services Canada, but because each ROE has a specific serial number, you cannot submit the QuickBooks form directly to Service Canada. However, QuickBooks is connected to EFILE, which means, it will take your payroll data and automatically transfer it to a Services Canada ROE form.
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