Employment standards record-keeping requirements

In Ontario, British Columbia and Alberta, these duties sit in the province’s employment standards statute. They matter in a sale because the records are the evidence of what the seller paid and may still owe: hours, wages, deductions and vacation. A buyer meets them when asking for payroll files in due diligence. The employment records answer shows what to request.

What three provinces require

• Ontario: the Employment Standards Act, 2000, s.15 requires an employer to record specified information about each employee. Section 16 requires the records to be readily available for inspection by an employment standards officer, even if someone else retains them. Retention periods are set in s.15.
• British Columbia: the Employment Standards Act, s.28 requires an employer to keep payroll records for each employee, including the hours worked each day, wages and deductions, and to retain them for 4 years after they were created.
• Alberta: the Employment Standards Code, s.14 requires an up-to-date record of hours, wage rate, earnings and deductions for each employee, and s.15 requires retention for at least 3 years from the date each record is made.

What to ask

Ask the seller where payroll records are held, for example with a payroll provider, and whether they cover the full retention period. Missing or incomplete records are a finding to raise with your lawyer. This entry covers Ontario, British Columbia and Alberta only; check the rules where the employees work.