Medical spa payroll: injectors, estheticians, and the medical director's fee

Medical oversight is why your injectors are employees

The medspa model concentrates control in the clinic by design, and control is the first thing CRA and the Ministry of Labour test. A nurse administers neurotoxin under the medical director's directives; the clinic sets the protocols, buys the product under the physician's authority, owns the laser and the treatment rooms, and books every client through its own software such as Jane. The nurse cannot raise a price, bring her own filler, or take the client list with her — so a per-treatment split is simply a wage expressed as commission, and the invoice she submits each month does not change that.

The same logic reaches estheticians running your IPL and hydrafacial devices on your booking calendar. The genuine exception is the practitioner who rents a room: her own clients, her own products and insurance, her own prices, and rent paid to you monthly — with HST on it, because room rental is a taxable supply. If the file cannot show those facts, the safe answer is a T4, because a CPP/EI ruling requested by one departing injector reaches everyone doing the same work, with both shares assessed retroactively plus interest.

Commission on services and retail: the ESA translation

Commission is a lawful way to pay employees, but every element of a medspa pay plan has an employment-standards consequence:

That last row is where medspas get burned. A commission plan may lawfully pay 40% of treatment revenue net of consumables — but only if the formula was agreed in writing up front. Clawing product cost back out of a cheque after the fact is a prohibited deduction, and it is precisely the pattern an ESA claim officer looks for. Keeping service and retail commission in separate codes also feeds the margin reporting our medspa bookkeeping builds each month.

Medical-director fees are a supplier invoice, not payroll

The physician who provides directives and oversight is running a business of their own, usually through a medicine professional corporation, and the monthly oversight fee should arrive as an invoice you pay like any vendor — no T4, no source deductions. If the director practises personally rather than through a corporation, the year's fees go on a T4A in box 048, still with nothing withheld. Putting the director on payroll to simplify things creates the opposite of simplicity: CPP and EI on someone who is not an employee, and an employment relationship neither side intended.

One wrinkle worth knowing: oversight is an administrative service, not patient care, so the director may charge HST on the fee. Because cosmetic treatments are themselves taxable supplies, a medspa can generally recover that HST as an input tax credit — one of the few places the clinic's taxable-heavy mix works in your favour.

The pay run itself, and the US trainer trap

The mechanics reward tidiness: an RP payroll account under the clinic's business number, cloud payroll such as Wagepoint withholding and remitting by the 15th of the month after payday, T4s and T4As by the last day of February, and an ROE filed within days when an injector moves on — turnover in aesthetics is real. Ontario's Employer Health Tax only applies once payroll passes the $1 million exemption, and we confirm your WSIB position rather than assume it either way.

When a new device lands, the manufacturer often flies in a US-based trainer for launch week. Fees paid to a non-resident for services performed in Canada carry a Regulation 105 withholding of 15% and a T4A-NR slip — miss it and the liability is yours, not the trainer's. That, along with duty and HST on the device itself, lives in our cross-border guide for medical spas.

Source: Ontario — Your Guide to the Employment Standards Act.