Recruitment ERP Consultant, Canada

Agency temps and incorporated contractors

Canadian staffing agencies commonly run two populations. Temps in light industrial, warehouse, clerical and similar roles are usually on the agency's own payroll, with source deductions, vacation pay and a T4 at year end. Many professional contractors, particularly in IT and engineering, invoice through their own corporations. Whether a given arrangement is employment or a genuine business-to-business contract is a question for your employment lawyer and accountant, and the answer has tax and liability consequences.

Once those decisions are made, the back office should keep the two populations firmly apart:

• agency payroll temps flow from approved hours to the payroll provider, with on-costs applied by province
• incorporated contractors flow from approved hours to a supplier payable, matched against their invoice or a statement the agency issues
• contractor corporation details, GST or HST registration numbers and insurance documents held on the supplier record
• year-end slips and contractor reporting produced from the correct source for each group

Agencies placing contractors with clients in the United States add another layer, because the currency, the billing entity and possibly the engagement structure change. Your advisors decide the structure; I make sure the system can represent it. The process map that applies everywhere is on my recruitment ERP page.

Provincial on-costs, workers' comp and agency licensing

Each province sets its own employment standards for vacation pay and public holiday pay, and temps on short assignments are often owed both on top of their hourly rate. Workers' compensation is administered by a provincial board, with premiums based on the industry classification of the work, so a warehouse placement and an office placement in the same province cost differently. Some provinces also license or register temporary help agencies and recruiters, and can hold agencies and clients jointly responsible for certain obligations.

For the ERP, this means:

• an on-cost table maintained by finance, per province and per classification, applied to each approved hour
• the worksite province stored on every assignment, because that drives which rules apply
• bill rates tested against fully loaded pay rates when an order is accepted, so a low-margin order is visible before the first shift
• license or registration details held per operating province, with renewal reminders

I do not quote entitlements or premium rates, since they vary and change. Your payroll provider and advisors supply them; the system applies them consistently. Defining this table and who maintains it is part of the solution design work.

GST, HST and QST on fees and contractor invoices

Sales tax touches a Canadian agency at both ends. On the revenue side, placement fees and contract billing generally attract GST or HST, with provincial sales tax rules in some provinces and QST in Quebec, and the rate and tax type depend on where the supply is made. On the cost side, incorporated contractors who are registered charge GST or HST on their invoices, and the agency may claim input tax credits on them.

Getting both sides right in the system is mostly about clean master data:

• client billing addresses and place-of-supply rules agreed with your accountant, so tax is determined consistently rather than chosen by the person issuing the invoice
• contractor registration status checked before payment, because an unregistered contractor should not be charging tax
• input tax credits recorded per contractor invoice and reconciled before filing
• French invoice and statement templates for Quebec clients and contractors where required

None of this is exotic, but agencies growing across provinces often discover that their invoicing tool applies one rate everywhere. Context on Canada's layered sales taxes across industries is on my Canada ERP consultant page.

Weekly pay, USD clients and the cash gap

Most agency temps are paid weekly or biweekly, while clients pay on their own terms, often slower for large accounts and US clients billed in dollars. Every new contract widens that gap before it pays back. Agencies bridge it through retained earnings, bank lines on receivables or factoring. Whatever the funding, a lender will look at aging, disputes and how quickly approved time becomes an invoice.

The requirements that matter here:

• invoices generated from approved timesheets within the same week, grouped to suit each client
• USD receivables held in a USD bank account where you keep one, with realized and unrealized exchange differences posted correctly
• credit limits that consider both invoiced and approved-but-unbilled time
• a cash forecast that lines up upcoming payroll against expected collections in both currencies

Permanent placements add a lighter revenue stream with its own rule: a fee invoiced on the start date and a guarantee period that may require a replacement or refund. I link the guarantee terms to each placement so finance is alerted when a hire leaves early. Integration design keeps the ATS, payroll and ledger in step.

Choosing systems and migrating from QuickBooks or Sage

Canadian agencies often start on QuickBooks or Sage, a timesheet app and a payroll provider. That works until the agency adds a second province, a US client base or a significant contractor population. At that point the options are a staffing back office suite, a general ERP set up for staffing, or a stronger accounting platform with a better integrated timekeeping tool.

I help you decide by testing each candidate on your hardest real cases: a temp working across two provinces in one pay period, a registered contractor billing in USD, a Quebec client needing French documents and a permanent hire leaving inside the guarantee. Migration then covers active assignments and rates, unpaid contractor invoices, open receivables in both currencies and placements still under guarantee.

Engagements are remote. I plan workshops around your head office time zone and share recordings with branches elsewhere in the country. The Canada overview explains how engagements are structured, and the Zoho People Canada page covers the HR-side records separately.