Employee benefits for remote workers are compensation that goes beyond salary. They help address challenges for those who are working from home, such as setting up a home office, tech needs, feelings of isolation, and maintaining work-life balance.
Recent data from Statistics Canada indicate that in Q2 2025, approximately 28.4% of urban service businesses and 27.6% of rural companies anticipated offering remote work. Therefore, employers who update their employee benefits packages are more likely to retain talent, while those who do not may lose top-tier contributors to competitors.
Learn all about key benefits for remote workers in Canada, what’s most important, how to implement them in line with CRA tax regulations, and budgeting tips in this article.
Traditional Health Insurance for Work from Home Workers
Employed Canadians would switch jobs for higher pay, more flexibility, and better benefits. Moreover, employees who receive meaningful benefits have higher engagement levels than those with fewer options. So, here are 3 options for employers to offer remote workers:
Individual Health Insurance Plans
Enrolling everyone in a single group plan can be challenging when employees are located in different provinces/territories or countries. Thus, allowing them to get reimbursed for their own health insurance gives remote workers more flexibility. Companies can offer monthly or annual contributions to help cover insurance premiums.
Be aware that payroll, benefits, taxes, and insurance rules can vary by province or territory; therefore, always check local requirements.
Telemedicine Benefits
Making it fast and convenient for remote employees to consult healthcare providers virtually is hugely valuable. Companies can provide access to on-demand telehealth platforms that allow remote workers to message/video chat with Licensed doctors 24/7 for non-emergency issues.
Amounts are only non-taxable if the plan qualifies as a private health services plan (PHSP) (which covers eligible medical and hospital expenses). Payments or reimbursements for medical services not covered by a qualifying PHSP are usually taxable.
Childcare and Family Benefits
Childcare stipends help working parents cover the cost of care while they are at work. They are usually taxed, but some exceptions exist. They may be non-taxable if provided at work, managed by the employer, available to all employees at no cost or at a low cost, and not open to the public.
Employers can also offer programs that provide resources, flexible schedules, and backup care. These benefits show that a company supports families, which can help attract and keep employees with family responsibilities.
Mental Health and Wellness Support for Remote Employees
According to Statistics Canada, in April 2023, 21.2% of workers reported experiencing high work stress. By April 2025, 7.7% of employees felt they might lose their jobs in the next six months, indicating job insecurity.
Besides, remote work can lead to mental health issues like feeling lonely, burnout, and worrying about job stability. Yet, the traditional company group health plan may not fully cover these issues. Here are 4 best ways to offer health insurance to remote teams:
Employee Assistance Programs (EAPs)
Many EAPs offer confidential support through virtual counselling, stress management workshops, crisis assistance, and professional referrals. Employees can get assistance remotely via phone, video, or secure messaging for issues like mental health, family problems, financial stress, and substance abuse.
Counselling for mental or physical health, retirement, or finding a job is usually not taxed. However, financial counselling and personal tax preparation services are taxed. Besides, coverage, hours, and session limits differ, so outline the plan’s main features (hours, language options, and access to care).
Mental Health Support Resources
Providing access to mental health services, including counselling, therapy, support groups, and apps, ensures your remote team has support channels. Digital wellness platforms offer employees access to meditation, sleep tools, and mental health resources.
Virtual Exercise and Fitness Classes
Sitting at a desk all day can negatively impact the physical health of remote employees. Subscriptions to meditation and wellness apps are great options, as they offer live and recorded workouts. This promotes movement, hydration, better sleep, and stress relief, keeping remote employees active and healthy.
Ergonomic Equipment Stipends
Cash allowances for purchasing ergonomic office equipment and furniture, which are taxable, make it easier for remote employees to create comfortable, injury-free work-from-home setups. Common requests include ergonomic chairs, adjustable desks, computer monitors, keyboard trays, and laptop stands.
Monthly Reimbursement Amounts for Remote Staff
Remote work requires fast internet and phone service for a good quality experience with video calls, file sharing, and communication. Here are 3 suggestions for employee benefits for remote workers in Canada:
Tax Treatment
Cash allowances are usually taxable, but some may be non-taxable. So, it’s essential to understand the tax rules for benefits to stay compliant.
- Cash Benefits: Allowances and reimbursements paid in cash are usually taxable. Employers need to deduct income tax, CPP contributions, and EI premiums.
- Non-Cash & Near-Cash Benefits: Non-cash benefits (such as equipment for personal use) and near-cash benefits (such as gift cards) are also taxable. Only the personal use portion is taxable, subject to income tax and CPP deductions, but usually not EI premiums.
Note that all taxable benefits must be included on the employee’s T4 slip, specifically in box 14 with code 40.
Disclaimer: Tax laws can be complicated and may change. This is general guidance, and employers should refer to the CRA’s T4130 Employers’ Guide or consult a tax professional for specific cases.
Internet and Phone Reimbursements
Setting clear policies for reimbursing costs, such as home internet/cell service and co-working space memberships, takes the financial stress off employees. It helps them understand what the company will cover and clarifies your remote work benefits. Employers can make things easier by providing a set allowance to cover the estimated business cost of internet, as long as it doesn’t support much personal use.
Home Office Tech and Equipment
Providing company-purchased devices, such as laptops, monitors, printers, webcams, headsets, and other essential tech, makes it easier for remote employees to be productive at home. Ergonomic equipment, such as standing desks, online ergonomics assessments, and home office furniture allowances, also demonstrates a commitment to the well-being of remote workers.
Important Update: Starting January 1, 2024, the CRA has new rules for identifying an employee's Province of Employment (POE) for payroll deductions. For full-time remote workers, the POE will be the province where they are connected to their employer's establishment, even if they live in a different province.
This change affects income tax, CPP, and EI deductions. Employees may need to sort out tax differences when filing, which could mean they owe more. Employers need to understand these rules to handle payroll correctly.
Flexible Work Arrangements Benefits in Remote Companies
Offering flexibility and autonomy over when and where remote employees work is highly valued. Businesses can offer Flexible Benefits Plans and build flexibility into roles, schedules, and environments. Here are 5 recommended employee benefits that define remote work’s core value:
Flexible Working Schedules
Employers regulated by the federal government will need to create a Right to Disconnect (RTD) policy once new amendments from the Budget Implementation Act, 2024, No. 1, take effect. This is expected to happen by 2026, giving employers a year to comply.
Providing flexibility is good, but many industries now have to set clear rules about after-hours communication. Note that this is not an optional benefit; it is a required compliance measure. So, keep an eye on updates from ESDC and start drafting your policies.
For the private sector, allowing remote employees to set their own start and end times gives them the freedom to work at their most productive times. You can establish a set of “core hours” for required meetings and collaboration. Outside of those, remote staff can determine their schedules.
Part-Time and Job Sharing Remote Work Options
Enabling employees to work remotely part-time provides them with the flexibility to balance their work and personal life. Job-sharing roles with part-time schedules are another creative way to build flexibility between two remote employees. They are helpful for remote workers with caregiving responsibilities.
Extended Leave and Sabbatical Policies
Extended paid leaves and sabbaticals (3-6 months) allow remote employees to disconnect and recharge completely. It gives high performers the incentive to commit to the organization long-term. These policies should match provincial employment standards for leaves of absence.
Paid Volunteer Time Off
Giving remote employees a set number of paid days or hours off annually to volunteer for causes they care about enhances loyalty and satisfaction. Compared to fixed PTO, it is less prone to burnout than vacation days, as employees are actively helping communities. With geographic spread, volunteering also helps remote workers connect to their local regions.
Compressed Workweeks
A 4-day work schedule usually involves longer hours each day, such as four 10-hour days. And, overtime rules vary by location.
For example, under federal regulations, overtime applies after 8 hours in a day or 40 hours in a week at a rate of 1.5 times the regular pay. In Ontario, overtime begins after 44 hours in a week, while in British Columbia, employees receive daily overtime after 8 hours of work and double time after 12 hours in a day.
Employers should consider a three-day weekend in this situation. This setup enhances work-life balance, reduces commuting time for hybrid jobs, and allows for more extended rest periods while maintaining full-time hours.
Lifestyle Support for Canadian Remote Workers
Beyond core categories, forward-thinking employers provide supplementary benefits that enhance remote work experiences. Regular acknowledgment helps prevent them from feeling overlooked. Here are 3 important lifestyle benefits for Canadian remote workers:
Care Packages and Swag
Branded merchandise, welcome kits, and holiday gifts can help remote employees feel connected and valued. Look into companies like Thriver, Dynamic Gift Canada, and SwagNorth for custom packages that can be sent directly to employees’ homes.
Healthy Meal Delivery Subsidies
It’s easy for remote employees to rely on unhealthy, convenient snacks and takeout while working from home. Consider subsidizing meal delivery kits and prepared meals to help remote staff access nutritious food options. You can also provide healthy snack care packages or gift cards for grocery delivery services.
Co-working Space Assistance
Some remote workers prefer different workspaces beyond their home offices. Co-working spaces offer desks, meeting rooms, networking opportunities, and a professional atmosphere. It allows employees to pick the best environment for focused work, client meetings, or socializing, while still enjoying the perks of remote work.
Performance Incentives & Rewards for Remote Work
Creatively rewarding remote employees for great work is vital for engagement and motivation. Since remote managers can’t hand out praise in person, creating channels for recognition is essential. The 3 professional development benefits that address these concerns are:
Unique Experience Rewards
Instead of just cash bonuses, consider giving remote employees carefully chosen gift cards for excellent experiences as rewards. Remote workers will be excited to earn gift cards for restaurants, hotels, online classes, concerts, subscription services, and unique life experiences.
Cash and most gift cards are a taxable benefit. However, under the CRA’s administrative policy, gift cards for a specific retailer or a limited group of retailers can be treated as non-cash gifts. Non-cash gifts and awards can be non-taxable if their combined total fair market value is $500 or less per employee per year.
Additionally, there’s a separate $500 exemption for non-cash awards given for five or more years of service. Rewards based on performance are always taxable.
Reminder: The CRA allowed employers to reimburse up to $500 in the COVID‑19 pandemic for home office or computer equipment without taxes, but this only applied to purchases made between March 15, 2020, and December 31, 2022.
Starting in 2023, employees claiming home-office expenses can no longer use the temporary flat-rate method; they must use the detailed process with Form T2200 and Form T777/T777S.
Spot Bonuses for Top Performers
Help remote employees feel genuinely valued by giving top remote performers and major team contributors unexpected bonuses when they achieve milestones and crush goals. Spot bonuses given without warning feel more meaningful than expected quarterly bonuses alone. They also motivate other employees.
Professional Development Assistance
Investing in employee development provides companies with a competitive edge by enhancing skills and knowledge. These budgets cover various learning activities, including:
- online courses (LinkedIn Learning, Coursera, Udemy),
- certifications (PMP, CPA, CFA, AWS),
- attending conferences (virtual or in-person),
- professional association memberships,
- technical training,
- leadership programs,
- books,
- and webinars.
Offer learning options that align with both employees’ career goals and the company’s needs. Note that employer-paid training is tax-free only if it primarily benefits the employer, such as job-related skills. If the training is more for personal interest or mainly benefits the employee, it’s taxable.
How Companies Develop a Good Remote Work Benefits Plan
The benefits above provide a template of perks and programs to consider when optimizing your remote work benefits strategy. But how do you put together the right plan for your distributed team? Here are 4 tips on structuring a benefits package tailored for remote employees:
Conduct Employee Needs Assessments
Survey your remote employees to gather direct input on their top priority benefits and preferred perks. Needs assessment polls help identify benefits gaps based on what remote workers value most. Assessments can be done when rolling out new remote policies or optimizing existing plans.
Weigh Different Benefit Options and Costs
Research pricing and implementation costs for new benefits you are considering. Analyze the ROI by comparing costs to engagement and retention benefits. Remember to promote employee contributions and copays to share costs. Offering benefits virtually is also more affordable.
Communicate Benefits to the Distributed Team
Don’t just email benefit policies to remote employees. Instead, schedule virtual meetings to explain plans and answer questions. Create one-pagers, infographics, and quick-reference tools on new benefits for easy visibility. Record short video overviews that remote workers can reference on demand.
Evaluate and Optimize Remote Work Benefits Over Time
Check in frequently with employees on benefits satisfaction, participation rates, and evolving needs. Adjust perks and policies based on feedback. Regular surveys help spot new needs. Ensure benefits align with corporate values and culture as your business scales.
The Bottom Line
Leading companies that invest in long-term remote work recognize that reevaluating their employee benefits for remote workers is crucial. Meanwhile, traditional benefits packages no longer meet the needs and priorities of most remote employees.
By focusing on benefits that enhance healthcare access, wellness incentives, professional development, collaboration opportunities, unique rewards, and support for work-life balance, companies can provide “best-in-class” remote work benefits.
These perks enhance employee satisfaction on a daily basis and demonstrate that the company genuinely values its remote and hybrid staff, cares about their well-being, and is committed to investing in their long-term success.
Disclaimer: This article provides general information for Canada and should not be considered legal or tax advice. Employment standards and overtime rules differ by province/territory and federally regulated status. For payroll taxes and reporting, consult CRA guidelines and check with your payroll provider or a qualified advisor.
