Legislation contained in the Federal Government’s Omnibus Budget Bill (Bill C38) proposes to eliminate the issuance of Social Insurance Number (SIN) cards. Under the new legislation, the card will be replaced with a letter from Service Canada containing the individual’s SIN.
According to the government, discontinuing the issuance of a card will serve to prevent identity theft and reduce government expenditures by 1.5 billion dollars per year.
While every payroll professional knows that the SIN is NOT supposed to be used as a form of identification, many individuals outside of the payroll orbit are unaware of this. Therefore, a consequential benefit of card discontinuance may very well be to eliminate this practice over time.
Employers have a legislative obligation to ask to see proof of an individual’s SIN after hiring. This procedure is designed to help ensure that a hired individual is who they say they are. Further, this responsibility is outlined in two federal government publications:
- T4001 Employers’ Guide – Payroll Deductions and Remittances (http://www.cra-arc.gc.ca/E/pub/tg/t4001/t4001-e.html#P276_17437),
- 2. SIN Code of Practice (http://www.servicecanada.gc.ca/eng/sin/employers/responsibilities.shtml).
Also, Under Canada Pension Plan Regulations, if an employee doesn’t have a SIN card, the employer must inform him or her within three days of starting work how to obtain one.
It is expected that individuals will be instructed to keep the Service Canada letter containing their SIN in a safe place, but how many will actually do so?
It will be interesting to see how things unfold over time and to see further government pronouncements on how to deal with these legislative matters.
The elimination of the SIN card brings several questions to mind:
- Will employers be instructed to ask to see the letter the individual received from Service Canada?
- What happens when the individual cannot find the letter, claims they never received one, or they lost it?
- Will there be a 1-800 number for employers to call to find out SIN’s of the individual’s they hire?
- Will the existing penalty provisions for failure to provide or obtain a SIN be levied ($100 for both the individual and employer)?
- What will happen or change regarding temporary SINs that begin with the “900” series and the expiry date that is included on the card?
- Will the letter now include an expiry date for the 900 series numbers?
Although there are no answers to these questions at this early stage, stay tuned. As soon as more information is available we will update employer’s accordingly.Categories: Articles