Legal tender is by law any denominations of money printed by the Bank of Canada. There is an exclusion to this in that it must also be acceptable to both parties of the transaction. See the following link from the Bank of Canada on Legal Tender and look at the answer to the question of What is "legal tender"?
The reason theyretailers may refuse the "legal tender" is in the case of counterfeit prevention. The stores that purchase the scanning machines are trying to be accommodating by deferring the decision to refuse the "legal tender" after verifying it (checking if it is acceptable).