Contents:

• Welcome
• Upcoming Events
• What's New
• GrandMaster Update

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Welcome!

October 2003 - Welcome to the latest edition of The Payroll News. As always, please feel free to forward this newsletter to your friends and associates who are interested in keeping up with the latest changes in the Payroll industry. Or better yet, subscribe them for free using the Tell Others About Us link.

Upcoming Events

Listed here are recent changes in legislation on Federal and Provincial levels that may impact your payroll calculations. Please view the following list for changes that affect your region.

FEDERAL:

September 17, 2003 - CCRA interest rates for the fourth calendar quarter - The Canada Customs and Revenue Agency (CCRA) today announced the prescribed interest rates that will apply to any amounts owed to the CCRA and to any amounts the CCRA owes to individuals and corporations. These rates are calculated quarterly in accordance with applicable legislation and will be in effect from October 1, 2003, to December 31, 2003. (Full Story - 234 Words)

September 12, 2003 - Government of Canada makes changes to Social Insurance Number cards - As part of the Government of Canada's plan to better manage Social Insurance Numbers (SIN), Human Resources Development Canada (HRDC) will begin issuing a new version of the SIN card today. The new version will carry different messages on the back of the card and the signature strip has been removed. These changes will help to reinforce for Canadians that the SIN card is a client account number for certain Government of Canada programs and services, and not an identity document. (Full Story - 860 Words)

September 8, 2003 - Government of Canada funds projects to assist youth facing employment barriers - HR Minister Jane Stewart today announced funding totaling $714,083 for eight projects under the Youth Employment Strategy (YES) for youth, including those facing barriers to employment, in Manitoba. "Youth employment is a top priority for the Government of Canada," said Minister Stewart. "These projects are an excellent example of our commitment to help Manitoba youth prepare for, and participate in, the world of work.". (Full Story - 1014 Words)

September 2003 - Income Security Programs Information Card for Fourth Quarter - The HRDC has released the Income Security Programs Information Card (Rate Card) for the final quarter of 2003. The rate card is updated quarterly and gives the maximum monthly rates for Old Age Security, Canada Pension Plan and Quebec Pension Plan benefits, as well as other selected figures. (Full Story - 540 Words)

Alberta:

September 30, 2003 - Human Resources and Employment's 2002-03Annual Report Released - Safer workplaces, a stronger workforce and better supports for families were key achievements of the Ministry of Human Resources and Employment last year. More than 135,000 Albertans received financial and medical benefits, more than 80,000 people attended career counselling sessions, more than 222,000 callers to ministry inquiry lines received information about careers and workplaces, and there were more than 1.3 million visits to Labour Market Information Centres across the province. (Full Story - 663 Words)

September 9, 2003 - WCB Alberta raises funds for Canadian Paraplegic Association - The Workers’ Compensation Board (WCB) Alberta 12th Annual Charity Golf Tournament held last Friday at Cougar Creek Golf Resort was an unprecedented success, raising close to $26,000 for charity. Net proceeds from the event were donated to the Canadian Paraplegic Association (CPA) Alberta in support of assisting persons with spinal cord injuries and other physical disabilities. (Full Story - 375 Words)

September 8, 2003 - Work Safe Alberta Initiative Resumes - "The 'Rookies at Risk' campaign resumes today encouraging Albertans to recommit themselves to safety as they head back to work, school, and the hockey arena," states President and CEO, Guy Kerr. "Rookies are not just young workers, they are anyone new to the job. We know from the claims we receive that the first year is the most dangerous for workers of any age." (Full Story - 465 Words)

British Columbia:

September 16, 2003 - EI Commission waives certain criteria for Work Sharing in BC - As communities affected by the BC forest fire situation begin the rebuilding process, Human Resources Development Minister Jane Stewart has requested, and the Employment Insurance (EI) Commission has agreed, to waive certain criteria to provide additional flexibility in applying the Work Sharing program. (Full Story - 576 Words)

September 2003 - WCB announces 2004 preliminary base rates - The 2004 preliminary figures reflect an aggregate base rate of $2.062 per $100 of employer's assessable payroll, virtually unchanged from the 2003 rate of $2.059. The negligible increase is proposed to cover projected costs in 2004 and beyond. This preliminary rate information is subject to final approval by the WCB Board of Directors in the fall of 2003. (Full Story - 319 Words)

September 19, 2003 - New initiative to help British Columbians achieve goals - Premier Gordon Campbell today unveiled a new initiative aimed at helping all British Columbians achieve their goals, by providing a window to information from early childhood development to lifelong learning, career planning and job training. Achieve BC offers a single-window to tips, tools and information that is unique in Canada, delivered through a range of new services including a comprehensive Web site, publications, a 1-800 number and information displays.. (Full Story - 380 Words)

Manitoba:

September 3, 2003 - Completing EI claimant reports on-line - Human Resources Development Canada (HRDC) has launched new EI Claimant's reporting service on-line. This new initiative is currently available to Manitoba residents only. Now, clients who file their EI claimant's report using Teledec our automated telephone service, and who live in Manitoba can use this new on-line service. (Full Story - 125 Words)

September 4, 2003 - Investment Revenue Shortfall Pushes WCB Assessment Rates Up - A steep decline in investment revenue requires the Manitoba WCB to set the 2004 average assessment rate at $1.70 per $100 of assessable payroll, a general rate increase of 9%. "Because there are only two revenue streams for the WCB, employer premiums and investment returns, the difference needs to be made up from the employer side," explained Doug Sexsmith WCB CEO, "It's important to say that, at the same time, Manitoba's WCB rates are the lowest among Canadian provinces and will remain so." (Full Story - 383 Words)

September 8, 2003 - Government of Canada funds seven projects for persons with disabilities in Manitoba - HR Minister Jane Stewart today announced funding of $299,690 for seven projects that will increase job opportunities for persons with disabilities. "The Government of Canada is committed to breaking down barriers for persons with disabilities and to support their inclusion in the working environment" said Stewart. These projects will enable persons with disabilities in Manitoba to gain valuable employment and life skills by providing valuable services such as work experience placements and career counselling. (Full Story - 727 Words)

New Brunswick:

September 5, 2003 - Labour statistics released for August, 2003 - A lower number of New Brunswickers working in forestry, fishing and mining sector, the food and accommodation sector, and fluctuations in the U.S. economy contributed to an increase in the unemployment rate in New Brunswick for August. Figures released today by Statistics Canada indicated there were 338,600 employed which was down from 343,900 at the same time last year. The labour force was also down to stand at 381,000 last month as compared to August of last year when it was 384,000. Statistics Canada also indicated that the New Brunswick seasonally adjusted unemployment rate for August stood at 11.1 per cent. (Full Story - 224 Words)

September 8, 2003 - New Web site provides youth career information - Youth in northwestern New Brunswick can now explore career opportunities in their region with the help of a new Web site and CD-ROM launched today. 'Professions Mad-Vic Occupations' contains job descriptions and video from employees working in 11 different organizations in Madawaska County and Victoria County. (Full Story - 517 Words)

Newfoundland and Labrador:

September 12, 2003 - Minister announces launch of Web-based information services - Labour Minister Percy Barrett has announced the launch of new Web-based information services for clients of the Department of Labour, the Labour Relations Board and the Workplace Health, Safety and Compensation Review Division. Prior to the launch of these E-government services, clients had to rely on government officials to prepare and provide photocopies of these documents, and could not directly search the information databases themselves. (Full Story - 1023 Words)

September 5, 2003 - Employment up; unemployment down for August - According to the latest Labour Force Survey from Statistics Canada, Newfoundland and Labrador’s employment numbers continue to move upwards while the unemployment rate for the province goes down. The province experienced employment growth for the eighth consecutive month. On a year-over- year basis employment rose 1.6 per cent for the month of August, or approximately 3,800 jobs. Along with job growth came a decrease in the unemployment rate of 0.7 percentage points to 14.2 per cent. (Full Story - 339 Words)

Nova Scotia:

September 30, 2003 - Legislation To Repeal Mandatory Retirement - Provincial government employees who turn 65 will find it easier to continue to work thanks to a legislative amendment introduced in the House of Assembly today, Sept. 30. The amendment to the Public Service Superannuation Act will remove the mandatory retirement provision for employees within the Public Service Superannuation Plan. The plan covers all civil service employees, employees of Crown corporations, Workers' Compensation Board employees, some Nova Scotia Community College employees and many members of the health sector. (Full Story - 435 Words)

Saskatchewan:

September 5, 2003 - Employment figures remain strong - Saskatchewan's latest job figures continue to show the fundamental strength of the province's economy, with numbers up for the 16th straight month year over year. Statistics Canada figures released today showed 499,300 working in August 2003 (seasonally unadjusted). That's the highest August on record for people working in Saskatchewan. (Full Story - 415 Words)

September 30, 2003 - WCB Announces Fair Practices Officer Appointment - The Saskatchewan Workers’ Compensation Board (WCB) today announced the appointment of its first Fair Practices Officer, Murray Knoll. Mr. Knoll will receive complaints from employers and injured workers who believe that WCB practices or processes have been unfair or inequitable, and direct them to the appropriate authority who can rectify the matter. (Full Story - 362 Words)

Yukon:

September 2, 2003 - Minister Considers Workers' Compensation Act Review Discussion Paper - –The panel reviewing the Workers’ Compensation Act has presented its discussion paper to the Minister Responsible for the Yukon Workers’ Compensation Health and Safety Board, Peter Jenkins. The discussion paper was created with the participation of a number of Yukon groups and individuals. It includes a compilation of the Act-related issues brought forward, and comments from Yukoners on many of those issues. (Full Story - 350 Words)

The current release of GrandMaster Suite (3.80.05) incorporates a number of changes to make it even easier to use the program and perform your payroll tasks. Recent program changes since our last Payroll News issue include:

• Employee not paid when terminating in a pay period - This problem would only occur when the employee rate was set to Annual. This bug has been correct with this version.
• Selections not saved in the Export Pay Hours function - Items chosen from the Selection tab options in the Export Pay Hours function would not be saved when saving the defined settings. This problem has been corrected with this version.
• Arrears description does not print on Pay Statement - The employee Pay Statement would not print the arrears description when deducting outstanding arrears from an employee. This has been corrected. Further, this fix will also ensure that the YTD arrears amount will display as 0.00 when the arrears balance has been reduced to zero with the current arrears deduction. Prior to this change the YTD balance would not display an amount when it had been reduced to zero.
• Hours Entry activate terminated employee option defaults to Yes - When you accessed a terminated employee during Hours Entry, a message box appeared asking you if you wished to activate the terminated employee. Prior to this change the Yes button was selected as the default button. This has been changed to the No option to prevent the accidental activation of a terminated employee.
• Payroll Condition group function does not save Earning Table selection - If you had included an Earning Rate Table as one of your conditional group options, it would not be saved when you saved your group settings. This problem has been corrected with this release.
• Reversal history including employees excluded from re-calculation - If a Reversal was calculated with all the employees included in a group, then the group is changed to include only one employee, the Interim Register would only show one employee. However, when the period is closed the History Register will show all employees that were in the original group. The Interim Register has been changed with this release to show all employees. As with the History Register, you will now have the option to print the selected group only. Further, a change was made to ensure that when calculating a Reversal Pay, the Result file and the Transaction Generated file are cleared prior to the calculation preventing data from employees not included from erroneously being written to history.
• Net Pay Year-to-date not printed on Pay Statement - The Net Pay Year-to-date option to print on your pay statement would not print on the Pay Statement when selected. This bug has been corrected with this release.
• Payroll Register does not include Provincial Health Tax data in sub-totals - The Provincial Health Tax data was not included in the Payroll Register subtotals when you sorted by Category. This problem was caused by a change in methods of storing the Provincial Health data in a previous version and required a minor change to the Payroll Register Report to recognize that methodology change.

Stay tuned to CanPay's Product News page to receive the latest changes and release information for all GrandMaster products!

If you are an employer who wishes to hire a family member for your business, you need to aware of certain issues that relate to Employment Insurance (EI). Under the Employment Insurance Act, people who are related to their employer might not be in insurable employment. This means that they would not have EI premiums deducted from their pay.

The Employment Insurance Act states that the employment of a person is not insurable if that person is not dealing at arm's length with the employer. In other words, that person (the employee) would not have EI premiums deducted from his or her pay cheques. It also means the person would not be able to get EI benefits. Generally speaking, the term "not dealing at arm's length" means the employer and the employee are related to each other (see below). Non-related persons can also be considered to be not dealing at arm's length. It is also possible for a person to be dealing at non-arm's length with a corporation.

For purposes of the Employment Insurance Act, there are several ways that employers and employees can be considered "related to each other". They can be related by marriage (including common-law relationship), adoption, or by blood (e.g. parents, brothers, sisters, or children). They can also be related to a corporation if they are related to a person or group of persons that control the corporation.

With this said, it does not mean that the employment of a family member is automatically not insurable -- that would be unfair. Even if the employee is related to the employer, they will be in insurable employment if it is reasonable to conclude (see below) that the employer would have hired a non-related person under similar terms and conditions.

"Reasonable to Conclude" means that you have to look at all the circumstances of the employment to see if someone else would have been hired under similar terms. The circumstances that must be considered include:

• terms and conditions of the employment, such as the hours of work;
• wages paid;
• length or duration of the employment;
• nature of the work being done by the employee; and
• importance of the work being done.

If you are still not sure if you should deduct EI premiums, you can request a ruling from the Canada Customs and Revenue Agency (CCRA). A ruling is an official decision that is issued by an authorized officer of the CCRA. It indicates whether or not EI premiums must be paid for the employment of a worker. Along with the ruling, you will also receive instructions on how to appeal a ruling if you do not agree with the decision.

Requesting a Ruling

If you are an employer, you can request a ruling in writing or by completing Form CPT-1 (available from the CCRA). If you are a worker, you can request a ruling in writing or by completing Form CPT-2. Your request can be sent to your CCRA nearest tax services office.

Human Resources Development Canada (HRDC) can also request a ruling at any time from the CCRA. Generally, HRDC will request a ruling when it is unsure whether or not the worker was working in insurable employment.

Under the Employment Insurance Act, you can request a ruling up until June 30 of the year following the year in which the employment occurred. For example, if the employment took place in 2002, you would have to request the ruling for 2002 before June 30, 2003. You may also wish to request a ruling if there is a significant change in the circumstances of the employment arrangement.

Finally...

If you have already deducted EI premiums and are unsure if you should have done so, you can request a refund of the EI premiums. If you ask for a refund and a ruling has not already been made, the CCRA will have to determine whether or not the request is valid. Normally this requires that the CCRA completes a ruling. In such a case, you must make your request for a refund no later than three years after the end of the year in question. For example, if you deducted EI premiums in 1998 and the employment was not insurable, you could get the premiums refunded up until the end of 2001. If you deducted EI premiums in 1997 and the employment was not insurable, you would be unable to get the premiums refunded for that year if you waited until 2001 to apply for the refund.