As an employer, it is important to protect and properly manage your employees’ social insurance numbers in your payroll system and payroll software. In an effort to cut cost and reduce the amount of identity theft in Canada, the Federal government has started phasing out the plastic Social Insurance Card as of March 2014. It is said that this will save the government about 1.5 Million dollars per year. Currently there is a fee of $10 to replace this card if it is ever lost or stolen, but there is no initial cost to get your first card.
This is one of the most used cards for identity theft; with no longer having a physical card this will reduce that risk. How can you protect your employees from this risk in your payroll system and payroll software? Be sure you are storing all employees’ personal documents in a safe place like a locked drawer where only specific people have a key or on an encrypted file on your office computer. There are many payroll software programs allow for this.
How to Adapt Your Payroll System
Without having the physical card, the Canada Revenue Agency (CRA) has put out guidelines in the T4001 Employers’ Guide as to what other supporting documentation employees can provide to their employers’ payroll system. If you have payroll outsourcing or external payroll services in Canada, your outsourced payroll specialists can help manage this. Employers can request birth certificate or certificate of citizenship or permanent residence before finalizing their employment documents. The following link is for Service Canada’s Information for Employers, this will provide other useful documentation:
http://www.servicecanada.gc.ca/eng/sin/employers/responsibilities.shtml
Ashley McKee / Payroll Administrator / PEO Canada