PESSI and Provincial Social Security: Why Only Some Employees Are Deducted

Provincial social security institutions such as PESSI provide medical and related benefits to lower-wage workers. The defining feature that trips up payroll teams is that these contributions are employer-paid and apply only to a subset of employees.

Employer-only and ceiling-bound

Unlike EOBI, where the employee carries a 1% share, provincial social security is funded entirely by the employer. No deduction appears on the employee's payslip. Crucially, coverage applies only to "secured" employees whose wages fall at or below the prescribed wage ceiling. Employees earning above that ceiling are not covered, so contributions are not due for them.

Getting eligibility right

The wage ceiling is the pivot. As salaries rise, employees can cross out of coverage, and as ceilings are revised, previously excluded employees can come back in. Doing this by hand each month invites both missed contributions and overpayments.

• Contributions are employer-funded only, with no employee deduction.
• Coverage is limited to secured employees at or below the wage ceiling.
• Employees above the ceiling are excluded.
• Eligibility must be re-evaluated whenever wages or ceilings change.
• The applicable province determines which institution and rate apply.

Zaffre HRM, part of Zaffre Axon by Zaffre Tech, evaluates each employee against the configured wage ceiling every payroll run. Employees at or below the ceiling are automatically marked secured and an employer contribution is generated; those above it are skipped. Because the rule is data-driven, a single salary revision quietly updates coverage without anyone re-checking a list.

This keeps your employer liability accurate and your records audit-ready. See provincial social security configured for your province and ceiling. Book a demo.