It is essential that you have all documentation you need to run a small business. All workers in Canada must have a Record of Employment (ROE).
Find out more about ROE and when and how to file one.
What is a Record of Employment?
An employer completes a Record of Employment (ROE), which is required for all employees to be eligible for the Employment Insurance Program (EI). The ROE must be submitted to Service Canada, even if the employee is not applying for EI benefits.
What is the best time to file an ROE?
An employee who experiences an interruption in earnings should complete the ROE. However, these earnings must not be considered to be insurable. Insurable earnings is the compensation that employees receive in exchange for EI premiums. EI premiums, along with other applicable deductions like the Canadian Pension Plan (CPP), and federal income tax, are part of the statutory deductions that are made on every paycheck.
What are Interruptions of Earnings (IoE)?
An employee’s earnings are interrupted if they do not receive any insurable earnings for 7 consecutive days. This does not apply to employees who work on non-standard schedules. An interruption in earnings is when an employee is fired, laid off, resigned or terminated.
An employee may also lose 60% of their weekly salary due to an injury, illness, pregnancy, or need to care for a child or relative who is seriously ill.
An employee can still return to work, or be employed by the employer, even though they have suffered an interruption in earnings. It is possible that multiple ROEs may be issued throughout an employee’s career.
A female employee may have multiple maternity leave, and therefore could have more than one ROE at the same employer.
There are other reasons ROEs can be issued
ROEs are required in certain situations. ROEs must be issued in special situations, such as when a business or organization changes the pay period type. This applies even if the employees are not experiencing a loss of earnings.
If there is a change of ownership, then the former employer must issue ROEs to all employees, unless there was an actual drop in earnings. The new employer can agree to issue one ROE for both periods of employment if necessary.
The ROE Guide, which is available on the Service Canada website, provides a comprehensive list of special circumstances in which a ROE should not be issued.
How to file an ROE
Service Canada can issue an ROE electronically or on paper. The filing deadline will vary depending on which method is chosen. The original copy (Part 1) must be provided to the employee if the ROE is in paper format.
Service Canada must issue Part II of the ROE within five calendar days after the first day of interruptions of earnings (or the last day paid), or the day that Service Canada becomes aware of interruptions of earnings. The employer is required to keep the Part III and payroll records related to this information for six years from the date it was issued.
The ROE can be submitted electronically. It is sent directly to Service Canada’s databases, which is used to process EI cases. The ROE must be issued by the employer within:
- Five calendar days following the close of the biweekly period
- Five calendar days after the month’s end, you will receive your monthly pay period.
- 15 days following the interruption of earnings for the first time
The ROE could need to be amended if the ROE is inaccurate or due to a settlement between the employee and employer. Service Canada may be issued an amended ROE if the ROE is incorrect or due to a settlement between the employer and employee. The amended ROE can be submitted electronically or in paper form.
This article only scratches the surface of how and when to issue an ROE. For more information on when and how ROEs can be issued, visit Service Canada’s website .
QuickBooks + Payroll
You can directly file your ROE from Quick Books Online using Quick Books +Payroll You can use the Payroll feature to review your payroll information and submit your ROE.
The ROE in Quick Books looks similar to the Service Canada form. However, each ROE has its own serial number so you can’t submit the Quick Books form directly. Quick Books can be connected to EFILE, which means that it can automatically transfer your payroll data to a Services Canada ROE.