ARTICLE | September 17, 2026

A practical overview for employers with Canadian operations hiring or sending employees to work in the United States

US payroll is not simply Canadian payroll paid in US dollars. Payroll obligations are driven by where the employee performs services, the employer’s US footprint, the employee’s work authorization and tax status, and the applicable federal, state, and local rules. Planning ahead is important, especially before the employee starts work.

What to expect before the first payroll

Key differences we see most often

Overtime and pay structure: US wage-and-hour rules can be more restrictive than Canadian rules, especially in states with daily overtime. A salary, day rate, flat rate, or contract amount may be allowed as a pay method, but it does not automatically satisfy overtime requirements. Employees must be correctly classified, hours must be tracked, and overtime must be calculated under the applicable law.

Employment standards vary by state: There is no single US employment-standards regime. Minimum wage, overtime, meal and rest periods, paid sick leave, pay-frequency rules, final-pay rules, wage statements, and leave requirements vary by state and sometimes by city.

Payroll taxes are not limited to federal tax: US payroll commonly includes federal income-tax withholding, Social Security and Medicare taxes, federal unemployment tax, and state unemployment taxes. Depending on the state, there may also be state income-tax withholding, paid-leave programs, disability programs, local taxes, and other employer assessments.

Workers compensation is generally separate: Workers compensation is usually obtained through a state-specific policy or state fund. It is not simply an extension of a Canadian workers compensation arrangement.

Independent contractor labels need care: Calling someone a contractor, consultant, or self-employed person does not control the result. US federal and state tests may classify the worker as an employee, which can create payroll-tax and wage-and-hour exposure.

Canadian and US reporting are different: Canadian T4/T4A reporting does not replace US Forms W-2 or 1099. US reporting and deposit schedules have their own deadlines and rules.

Information we need from you

·       Legal employer name and entity details, including EIN if already available

·       Employee name, US work address, home address, start date, job title, and supervisor

·       Visa or work-authorization information, where applicable

·       Expected work states and whether the employee will travel or work remotely

·       Pay terms, pay frequency, expected hours, overtime expectations, bonuses, allowances, and reimbursements

·       Whether the employee is replacing an existing worker or transferring from Canadian payroll

·       Existing US registrations, payroll accounts, workers compensation coverage, and prior US payroll history

Timing matters

Please involve us before an employee begins US work whenever possible. Payroll registration and account setup can take time, and we cannot reliably “fast track” a compliant payroll once someone has already started. Early planning lets us identify the correct employer, work-state registrations, payroll setup, and any issues that need employment-law or immigration counsel.

Important note

This notice is intended as a general payroll-planning guide, not legal or immigration advice. Because US requirements vary based on the facts and the states involved, we may recommend that you consult US employment, immigration, or tax counsel for a specific arrangement.