7 Practical HR Considerations for Canadian Businesses Expanding to the U.S.


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Insight into U.S. Human Resource Policies

There are a number of differences in human resource policies between the U.S. and Canada, making it important for Canadian businesses owners considering a U.S. expansion to fully understand regulations. Policies and procedures that focus on employees and comply with Federal and State Labor laws are imperative.

Q:  Can a U.S. employee be dismissed without minimum notice or “pay in lieu of notice” (severance)?

A: Yes. “At will employment” exists in most States in the U.S. This allows an employer to dismiss an employee, usually for good reason, without the obligation of paying severance or minimum notice as is required in the Ontario Employment Standards Act (ESA).

Q: What are the minimum vacation periods and mandatory holidays in the U.S.?

A: There aren’t any. Decisions as to how many vacation days or the paid holidays that an employee earns are at the discretion of the employer and can be designed to meet the needs of the company as well as the employees.

Q: How is medical insurance obtained?

A: Employee benefits play an increasingly important role in the lives of employees and their families and can have a significant financial and administrative impact on a business. Employee benefits in the US are handled differently than Canadian public insurance (eg. OHIP) and health insurance plans and premiums can vary dramatically across the U.S. Typically; the company will negotiate with insurance plan providers to determine the best plans for that worksite. The employer then determines how much of the premium will be company-paid based on financial capabilities and what they need to be competitive in order to recruit the caliber of employees they need.

Q: What are the allowable payroll frequencies in the U.S. (weekly, biweekly, etc)?

A: Similar to Canada, the choices can be weekly, bi-weekly, semi-monthly and monthly. It is important to know which one to use based on the State in which you have operations. For example, in New York State – laborers are mandated to be paid no less than weekly while administrative staff can be paid bi-weekly.

Q: Can I mandate that my workers receive their pay via direct deposit?

A: No. You cannot mandate that employees receive their pay via direct deposit only.  A company is required to provide a live paycheck if preferred by the employee.

Q: What are the mandatory U.S. policies for medical and/or maternity leave?

A: In the U.S., maternity and medical leave are covered by a 12 week “UNPAID” time frame. Employers have the availability to allow employees to use accrued vacation/sick time as well as crafting their own policies as to what benefits will be made available during the employees leave. These policies should ensure equal treatment of employees so as to avoid being seen as discriminatory.  Some cities have instituted mandatory paid leave policies but most companies have a well-crafted PTO policy already accommodate these rulings.

Q: What is the minimum wage rate in the U.S.?

A: Minimum wage varies by state in the U.S.  While the Federal minimum wage is $7.25, some states set a higher minimum wage through state legislation.  In New York State, the minimum wage will be $9.00 effective 12/31/15.

Guest Blog:

John H. Bradley, Regional Vice President, Alcott HR



Alcott HR is a Professional Employer Organization specializing in administering U.S. employees for Canadian corporations.


Redland Foods Adds Flavour to Buffalo Niagara

Red 1 Carolyn and Brian

When I talk about manufacturing in the Buffalo Niagara region, most people typically think of metal based products –especially when I tell them I’m working with a nut manufacturer. But Trophy Foods is not your average nut. Instead of hex nuts, flange nuts, and weld nuts, they value-add process almonds, pecans, cashews, peanuts, and more used for snacking and baking.

In January of 2014, I started to work with Trophy Foods Inc. as they considered a U.S. expansion. The company was outgrowing their Canadian facility and was considering locations in both New York and Michigan. BNE had the pleasure of working with Brian Paul, COO to provide the necessary data and guidance to ensure their expansion took place in Buffalo Niagara. The facility, named Redland Foods Corp., is now located in Cheektowaga, NY.

Redland Foods Inc. is one of the leading suppliers of high quality and innovative flavoured edible nuts, dried foods and confectionery products for both their name brand and many private labels. The facility has two roasting lines and a toffee line. They are equipped to handle an endless variety of packaging options in an array of sizes and formats. All products are either nitrogen flushed or thermal sealed for added freshness and food safety.

I recently visited Brian at the new U.S. facility to see firsthand the success they are experiencing nearly two years later. Redland Foods made major investments in the transformation of the facility and purchased critical processing and packaging equipment to meet their demand, as well as FDA regulations.

Close proximity to their Canadian headquarters, a strong workforce and the low cost of doing business in the Buffalo Niagara region has provided Redlands a successful start.

If you would like to enjoy Redland Foods product, stop by Aldi’s and try their sliced almonds!

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By Carolyn Powell, Business Development Manager

NEXUS – The Only Way To Travel

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I travel to Canada a few times each month as I work to help Canadian companies expand their business into the U.S. This November, I’m heading to Montreal to meet with companies through AmCham Quebec  for a program focusing on business opportunities in the State of New York for Quebec companies; the following week I’ll be engaging companies at Select USA in Toronto; and finally on November 23rd I’ll participate in the Ontario Export Awards in Mississauga. With all this travel, waiting bumper to bumper to cross the border is not the best use of time- and that’s why I have the NEXUS pass. NEXUS program is designed to expedite the border clearance process for low-risk, pre-approved travelers into Canada and the United States.

For $50, I now zip through the NEXUS Lane. The only catch? All those traveling in the car with me also need to be NEXUS pass holders. Any citizen or permanent resident of Canada or the United States can apply for a NEXUS pass. The process takes about six weeks and, if you’re approved (after risk assessment and interviews by border protection officials of both countries), the pass is valid for five years.

Following are details about the NEXUS pass that can help get you zipping across the border, just like me:

What is NEXUS?

The NEXUS program allows pre-screened travelers expedited processing when entering the U.S. and Canada.  Program members use dedicated processing lanes at designated northern border ports of entry, NEXUS kiosks when entering Canada by air, and Global Entry kiosks when entering the U.S. via Canadian preclearance airports.  NEXUS members also receive expedited processing at marine reporting locations.

In addition to designated process lanes, the NEXUS card is a Western Hemisphere Travel Initiative (WHTI) complaint travel document and can be used in any primary lane.  The more travelers participating in the NEXUS program, the greater the benefit to overall border wait times.  By having advanced traveler information, U.S. Customs and Border Protection (CBP) is able to reduce inspection times in the NEXUS lanes.  Greater participation in this program further reduces overall border wait times at the local crossings by allowing more cars to be processed per hour without increasing the infrastructure.

How Does the NEXUS Program Work?

At Buffalo land border crossings, program participants proceed to dedicated NEXUS only lanes and present their NEXUS photo-identification cards.  All occupants of the vehicle must be enrolled in NEXUS to utilize the dedicated lanes.  In addition to dedicated NEXUS lanes at the Lewiston and Peace Bridges, the Whirlpool Bridge in Niagara Falls is designated as a NEXUS-only crossing, available exclusively to NEXUS cardholders.

Additional Benefits of Global Entry included with NEXUS:

Individuals approved to participate in NEXUS receive photo identification cards that allow them to receive expedited passage at NEXUS-dedicated lanes at the land borders (both into the U.S. and Canada), NEXUS kiosks at airports when entering Canada, at Global Entry kiosks when entering the U.S. (both in the U.S. and at preclearance locations) and by calling a marine telephone reporting center in the marine environment to report their arrival into the U.S. or Canada.  NEXUS members who are U.S. citizens, U.S. Lawful Permanent Residents, or Canadian citizens will also receive the benefits of TSA Pre-Check.

Apply for a NEXUS card at GOES or visit the Trusted Traveler Programs section of the CBP website to find out what program best fits your cross-border travel needs.

Carolyn Powell, Business Development Manager

AMDOR Opens Doors to Buffalo Niagara


After a company expands to Buffalo Niagara we like to visit and see how their operations are progressing . Recently we stopped by AMDOR, a division of Whiting Group, which is a Canadian headquartered manufacturer. Whiting Group selected Buffalo Niagara for their AMDOR location.  After renovating its facility, AMDOR is now fully operational and has been running seamlessly in its first six weeks.

Here is a behind the scenes look at AMDOR’s expansion and the work that went into setting up shop in Buffalo Niagara:

Headquartered in Burlington, Ontario, Whiting Group is an advanced manufacturer with multiple divisions and facilities including a location in Lancaster, NY. The company needed to expand its AMDOR division, which manufacturers roll up doors for fire apparatus, ambulances and other specialty vehicle applications. AMDOR considered expanding at its existing facility in Burlington, or establishing their first U.S. site in Buffalo Niagara, Wisconsin or Florida.

AMDOR weighed several critical priorities in their relocation decision, including:

  • Cost effective location, including infrastructure, workforce and facility
  • Existing building or build-to-suite options that could meet budget and timeline expectations
  • Available and talented workforce
  • Close proximity to Canadian headquarters

Buffalo Niagara Enterprise (BNE) helped AMDOR complete a real estate search for their new facility and provided employee wage data, worker availability and potential benefits costs based on the specific job positions and descriptions. Through the assistance of BNE and other regional agencies, the company gained a better understanding of Buffalo Niagara’s incentive process and completed various incentive applications, meeting required deadlines. AMDOR applied for and received benefits from Lancaster Industrial Development Agency (Lancaster IDA), Empire State Development (ESD), New York Power Authority (NYPA), and New York State Energy Research and Development Authority (NYSERDA). To ensure the company had the needed utilities and supply, BNE connected AMDOR with New York State Electric and Gas Corporation and National Fuel.

AMDOR purchased a 21,000 sq. ft. existing facility on eight acres in Lancaster, NY and completed a 10,000 sq. ft. addition. AMDOR is on its way to hiring 17 people this year, with plans to have at least 28 full time employees by year five.

by Carolyn Powell, Business Development Manager

Buffalo Niagara Real Estate Primer for Canadians – Part 2

Following up to Buffalo Niagara Real Estate Primer for Canadian Companies – part I, below are additional frequently asked questions:

Q1: Can we reduce our ‘real estate costs’ by expanding into a less costly market, without jeopardizing our profits or business model?

A1: For many companies it is a resounding yes.

Average net asking sale price ($/sf) industrial real estate:

  • Toronto GTA (Greater Toronto Area) : $113.57 psf. *
  • Buffalo/ Erie County: $36.60 psf. ** = savings of approx.   68% per square foot.

Average land cost for fully serviced industrial land:

  • Toronto GTA: approximately $597,000/acre*
  • Buffalo/Erie County: approximately $45,000/acre = savings of approx. 92% per acre.

Q2: Can we potentially reduce not just our real estate costs but our ‘overall occupancy costs’ including but not limited to utility costs, real estate taxes, sales taxes, employee wages and costs, through available economic incentive programs?

A2:  Yes! In the United States and specifically in the Buffalo Niagara region companies of all different sizes can apply and potentially qualify for incentives programs to assist with utility costs, real estate taxes, sales taxes, employee wages and costs.  Most of these programs’ main criteria are based on the number of new jobs being created, the projects’ costs and plans, and the specific industry the company operates in.  Companies need to complete an application process and potentially compete for some of these programs.

by Carolyn Powell, Business Development Manager

Buffalo Niagara Real Estate Primer for Canadians – part 1

When working with Canadian companies considering a Buffalo Niagara business expansion, we find that real estate availability and costs are a primary concern due to differences in Toronto and Western New York markets.  Canadian business owners are unsure of the availability of commercial properties, average sale rates, and the current trends relating to Buffalo Niagara real estate.

Frequently asked questions include:

  1. How does Buffalo Niagara compares to the U.S. real estate market?
  2. Have real estate prices risen?
  3. Is there a shortage of properties which tenants and buyers are competing for?

To help address these concerns we refer to our partner CBRE|Buffalo, and their annual MarketView report.  This helpful publication summarizes the real estate market in Buffalo Niagara. Below are excerpts from the Annual 2014 report Canadian businesses owners find particularly useful:

Industrial Market

As forecasted in 2013 by CBRE|Buffalo, the 2014 Buffalo Industrial Market experienced a decrease in the overall vacancy rate, decreasing from 5.7% to 4.5%.  This equates to 900,984 sq. ft. being absorbed in the greater Buffalo MSA.  Noteworthy is that in 2011 the overall vacancy was 13.2%.

As a result of a rebounding economy and comparatively weak construction activity, the national overall vacancy rate decreased from 11.7% to 10.6% in the third quarter 2014. (CBRE, INC U.S. Industrial Market View Q3 2014).  The 2014 results mark the 10th consecutive year the Buffalo Industrial Market vacancy rate has remained below the national average.

commercial charts

* The arrows are trend indicators over the specified time period and do not represent a positive or negative value. (e.g., absorption could be negative, but still represent a positive trend over a specified period.)

Office Market

The overall Buffalo office market vacancy rate continued to inch up this year to 14%, a 0.4% increase from last year.  The slight increase comes at a time when the national office vacancy reached its lowest level since 2008 at 13.9% (CBRE Research, Q4 2014).  Historically, Buffalo’s overall vacancy is below the national numbers, but the large amount of vacant space in the downtown core has proved to be a detriment to the overall vacancy rate.  Despite the increase in overall vacancy, more than 315,000 sq. ft. of new inventory was added across the submarkets.  The Majority of the space was pre-leased and aided in a positive net absorption of 158,786 sq. ft. Positive construction will continue well into 2015 with over 550,000 sq. ft under construction or planned.  As in previous years, the Buffalo market continues to remain consistent with the national office vacancy of 13.9% reflecting a relatively stable market. (CBRE, Inc. U.S. Office MarketView Q4 2014)

While the U.S. has had a slower recovery in new construction numbers, the Buffalo office market has continued to deliver new office product each year (CBRE Research, Q4 2014).

office charts2

* The arrows are trend indicators over the specified time period and do not represent a positive or negative value. (e.g., absorption could be negative, but still represent a positive trend over a specified period.)

For questions frequently asked by Canadians evaluating U.S. expansion and real estate, click here for Real Estate Primer for Canadians – Part 2.

For additional information contact Steve Blake, CCIM, Partner at 716-362-8707 or steve.blake@cbre-buffalo.com

CBRE|Buffalo, an affiliate office of CBRE, Inc., staffs 16 professionals and offers a full range of commercial real estate services to Erie, Niagara, Chautauqua, Cattaraugus, Wyoming and Allegany counties, and portions of Orleans and Genesee counties.

by Carolyn Powell, Business Development Manager

Benefits of a Foreign Trade Zone


Do you import raw materials and goods from overseas?  Do you buy these goods in bulk and then resell them?  Do you add value to the imported components or raw material before they are sold again?  If you answered yes to any of the above, then a Foreign Trade Zone (FTZ) might save your company money and give it a competitive advantage.

The purpose of an FTZ is to stimulate international trade and create jobs and investment in the United States rather than abroad.  In the U.S., an FTZ is a defined geographic space that is next to or within a short commuting distance from an official U.S. port of entry.  U.S. Customs and Border Protection supervise the Zones, but do not run them.  The space is secured and operated as a public good under a license agreement with the U.S. federal government.  In foreign countries, FTZs are typically referred to as Free Trade Zones.  Both U.S. and foreign goods can be moved into a Zone for storage, exhibition, assembly, manufacturing and/or processing.

There are multiple benefits to using an FTZ, but each company must research which specific benefits would apply on a case-by-case basis.  In doing so, they must consider: 1) what is being imported; 2) the volume and frequency of the imports; 3) will the imported goods be changed into something else; 4) whether the final good will be exported or enter U.S. customs territory; 5) what is the normal duty rate, if any, of the imported good, etc.  Generally speaking, an FTZ will provide the most savings to a company that imports a high volume of goods, the goods are not typically duty-free, and many of the goods will ultimately be exported out of the U.S. to the end user. Continue reading

Growing by Takeoffs and Landings

As both an economic development professional and lifelong Buffalonian, watching the companies that I help establish a business in our region grow and succeed is incredibly exciting and rewarding. Each company that we assist is unique; some begin with a large scale operation while other companies start small and grow their business over time.

Headquartered in Kansas, Executive AirShare is fractional ownership aircraft company that began with regional hubs in the central U.S.  In 2009, they decided to establish a northeast location to expand their business and reach new markets.  A successful location needed to meet four major criteria:

  • Appropriate space for both corporate aviation services and back office operations
  • A potential customer base
  • Available workforce, including pilots
  • Available incentives to assist with first year expenses and startup costs

BNE assisted Executive AirShare with the coordination of potential incentives and helped facilitate discussions for runway services and leasing hanger space.  In 2010, the company leased 26,000 square feet of hanger and office space at 485 Cayuga Rd, Cheektowaga, NY.  BNE was then able to assist them with their marketing efforts for a grand opening event and the launch of their first northeast location.

Since October of 2010 Executive AirShare has refurbished an 8,300 square-foot private aviation terminal and 53,000 square-feet of hangar space, doubling the size of its operations at Buffalo in less than three years.  Much of the added hangar space is being used to support demand for jet aircraft management services for a growing list of Western New York-based companies. The Buffalo based aircraft now totals seven in the fractional and managed fleet, with one or two additional aircraft that rotate into Buffalo from central U.S. bases.  This facility operates with 17 full-time employees based in Buffalo and supported by additional flight crew from other locations as needed.

by Carolyn Powell, Business Development Manager

Fichman Furniture Living the American Dream in WNY


Sometimes a simple email can make your day.  This happened to me recently when I checked in with a business owner who BNE helped in establishing their first US manufacturing facility.  While I knew the company was doing well, the owner was so exuberant that it really brought a smile to my face and also demonstrated so clearly why the work we do is so important.

Toronto-based Fichman Furniture began working with BNE in 2009, seeking to bring their business to the US.  After assisting with site selection, cross-border due diligence and workforce development, in 2012 the company purchased an 8,000 square foot facility in Holland, New York.

The company designs and manufactures radiator covers, and 95% of its sales are in the US.  The new facility was selected to reduce shipping costs for both raw materials as well as finished goods, without the delays associated with cross-border logistics. And three years later, Erran Fichman, the company’s owner, reports that sales have DOUBLED since the move while shipping costs have been cut in HALF!

While labor costs are about the same, Fichman says in Western New York “you get far higher quality and value.”  He has six full-time employees and hopes to add additional workers in the future and says now he “can really focus on projects that will continue to grow the business.”  Thanks to improvements in technology and machinery, the facility is more productive while maintaining the highest safety standards.  “We never achieved this level of quality and we produce our covers in less than half the time it would take in Toronto,” he added.

Fichman has nothing but good things to say about his experience dealing with WNY officials and businesses, from the local Post Office to his M&T Bank branch in East Aurora, Holland’s town hall to local law enforcement.  The adjectives used were “straightforward, professional and reliable.”  What a testimonial!

BNE is privileged to promote Western New York’s business-friendly attributes on a daily basis. Fichman Furniture’s success story beautifully illustrates that our region has all the right stuff for businesses that are seeking to expand in the US.

by Carolyn Powell, Business Development Manager

New York State Tax Reform Benefits Manufacturers

International companies that expand into the U.S. often apply for and receive major tax incentives.  But what if the tax law were amended to create a significant incentive across the board, without companies even having to apply?  Well, that is exactly what New York State has done.

On March 31, 2014 New York State enacted significant changes to reform its corporation tax laws, most of which took effect January 1, 2015.   Many of the changes are aimed at simplifying an overly complex system of taxation and include the elimination of some taxes and revisions to the tax bases.    Included in the corporate tax reform are changes that will greatly benefit qualifying New York State manufacturers by reducing the income tax rate to 0% and creating a 20% real property tax credit.

To qualify, a manufacturer must have property in New York that is principally used by the taxpayer in the production of goods by manufacturing, processing, assembling, refining, mining, extracting, farming, agriculture, horticulture, floriculture, viticulture or commercial fishing and during the tax year more than 50% of its gross receipts are derived from the sales of goods produced by these activities.

To be eligible for the zero percent tax rate the manufacturer must have either:

1) property located in New York with an adjusted basis for federal income tax purposes at the close of the taxable year of at least $1 million; or

2) all of its real and personal property is located in New York.

The zero percent tax rate applies to the business income tax base and is only available for qualified manufacturing corporations taxed under Article 9-A, franchise tax on business corporations.

The real property tax credit for qualified manufacturers is a credit equal to 20% of real property taxes paid during a tax year for real property located in New York and principally used in manufacturing.  The property can be owned or leased by the taxpayer.  Leased property must be leased from an unrelated third party.  The lease must be in writing and require the lessee to pay the real property taxes. The lessee must make the real property tax payment directly to the taxing authority.

For those that are not qualified manufacturers, the tax rate on business income will be reduced from 7.1% to 6.5% beginning January 1, 2016.

The legislation is a huge step forward for encouraging businesses to expand and grow in New York and it doesn’t stop there.  New York offers a number of attractive incentive programs available at the state and local levels to help businesses locate and grow here.  Additionally, there is no sales tax on machinery, equipment, tools or supplies used in manufacturing and New York State does not have a personal property tax on inventories, machinery and equipment either.  


Guest blog: Andrew J. Toth, CPA, Partner at Tronconi Segarra & Associates, LLP, atoth@tsacpa.com ,(716) 633-1373