Inside Canada’s New Employment Rules: Expanded Employee Leaves of Absence and Employment Insurance Benefits
The federal government recently confirmed that the new rules for maternity, parental and caregiver benefits under the Employment Insurance Act (EIA) and the corresponding leaves under the Canada Labour Code (CLC) are scheduled to come into force on December 3, 2017. The relevant amendments to the EIA and the CLC are contained within the Budget Bill Implementation Act, 2017 (Bill C-44).
MATERNITY LEAVE AND BENEFITS
Once the amendments are in force, the EIA will allow birth mothers to access employment insurance (EI) maternity benefits up to 12 weeks before their due date (as opposed to the current eight weeks). EI maternity benefits will continue to be provided at the rate of 55 per cent of an eligible employee’s average weekly insurable earnings, to a maximum of C$543 per week, for a period of up to 15 weeks. Bill C-44 makes a corresponding change to the CLC to allow birth mothers to commence maternity leave up to 13 weeks prior to the child’s due date.
PARENTAL LEAVE AND BENEFITS
Bill C-44 also amends the EIA to allow for payment of parental benefits over a longer period of time at a lower benefit rate. Particularly, an eligible parent will be given the option of extending his or her EI parental benefits over a 61-week period after a child is born or adopted at the benefit rate of 33 per cent of his or her average weekly insurable earnings to a maximum of C$326 per week.
The current option provides an eligible parent with 55 per cent of his or her average weekly insurable earnings to a maximum amount of C$543 per week over a 35-week period after a child is born or adopted. Coinciding amendments to the CLC will come into force on December 3, 2017 to extend the length of parental leave for up to 63 weeks.
CAREGIVER LEAVE AND BENEFITS
Bill C-44 establishes a new adult caregiver benefit that allows an eligible caregiver to receive EI benefits of up to 15 weeks to care for a critically ill adult family member. In addition, the EIA will allow family members to receive EI benefits for up to 35 weeks to care for a critically ill child. Currently, only parents of a critically ill child may receive such benefits. Bill C-44 amends the CLC to reflect the extension of EI benefits, with up to 17 weeks of leave provided to employees to care for a critically ill adult family member. The CLC will also be amended to provide a family member with up to 37 weeks of leave to care for a critically ill child.
IMPACT ON EMPLOYERS
The CLC applies to federally regulated employees such as individuals employed by banks, federal Crown corporations and broadcasting companies. Employees who are provincially regulated will not be impacted by these changes unless the provinces amend or have amended their employment standards legislation to coincide with the new EI benefit periods.
In Ontario, the Fair Workplaces, Better Jobs Act, 2017 (Bill 148), will amend the Employment Standards Act, 2000 by increasing the length of parental leave from 35 weeks to 61 weeks for employees who take a pregnancy leave and from 37 weeks to 63 weeks for employees who do not take a pregnancy leave. Bill 148 will also introduce a new critical illness leave of up to 17 weeks for employees to provide care or support to a critically ill adult family member. This leave is in addition to the existing critically ill child care leave of up to 37 weeks. These amendments are scheduled to come into force on December 3, 2017. For more information on Bill 148, please see our November 2017 Blakes Bulletin: Ontario Passes Bill 148, Rolls Out Major Changes to Workplace Laws.
In Alberta, amendments to the Employment Standards Code (Code) are scheduled to come into effect on January 1, 2018. Among other things, the Code will provide for up to 36 weeks of critical illness of child leave. The Alberta government has already noted that the length of parental leave may be increased in the future to align with the new EI benefit timelines.
Employers should take these changes into consideration when workforce planning. Employers affected by the expansion of the protected employee leaves will also need to consider how the changes will impact their pension, health, disability and other benefit programs. In particular, employers should review the terms of any top-up arrangements in place for maternity or parental leave, which can be found in member booklets, collective agreements or employee handbooks. This includes reviewing whether the top-up arrangements will be continued for the length of the new extended leave periods. Employers may incur significant increased costs where top-up arrangements are based on a percentage of an employee’s income and where the employee takes a longer leave of absence. As such, employers may want to consider amendments to their top-up arrangements such as by providing the top-up over the extended period of time at a reduced rate.
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