Employment Insurance Amendments and Proposed New Recovery Benefits

Kalen Ingram
Posted September 3, 2020 Category: Businesses, Individuals/Families, News & Updates
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The Federal Government recently amended the Employment Insurance Act (EI Act) to make EI more accessible to Canadians hit hardest by COVID-19 and announced details of new “recovery” benefits it intends to introduce.  These new benefits are expected to take effect on September 27, 2020.  To bridge Canadians currently on the Canada Emergency Response Benefit (CERB) to EI or other recovery benefits, the CERB program has been extended a further 4 weeks, to October 3, 2020.

While the EI Act amendments have been passed into law, the new recovery benefits will require parliamentary approval, which will not happen until after the House of Commons returns on September 23rd. In this blog, we have summarized the key EI Act amendments, the proposed recovery benefits, and end with a quick reminder about Infectious Disease Emergency Leaves.

  1. EMPLOYMENT INSURANCE

Eligibility

In order to qualify for EI, workers must have worked a specified number of insurable hours during the year prior to the application. Given the high level of unemployment since the pandemic hit, many Canadians have not been working insurable hours and would be unable to qualify for EI under the normal regime.  The EI Act has therefore been amended to include a one-time credit of insurable hours to EI claimants as follows:

  • 300 insurable hours for regular EI benefits (available for job loss)
  • 480 insurable hours for special EI benefits (available for sickness, pregnancy, parental, compassionate care, or family caregiver leaves)

Normally, the regional unemployment rate is used to determine the number of insurable hours required to qualify for EI for a particular claimant. The requirement can vary from 420 to 700 insurable hours, with fewer hours being required in regions where the unemployment rate is higher.  The regional unemployment rate also determines the number of weeks of EI regular benefits that can be received (normally ranging from 14 to 45 weeks) and the number of “best weeks” of earnings that will be used to establish the claimant’s weekly benefit rate (normally ranging from 14 best weeks to 22 best weeks).

To address the unique circumstances created by COVID-19, the EI Act has been amended such that:

  • the insurable hours requirement for EI regular benefits is set at 420 hours (before the 300 hours credit is applied, meaning a claimant would only need 120 insurable hours to qualify);
  • the minimum entitlement period for EI regular benefits is 26 weeks; and
  • the number of “best weeks” to be used to calculate one’s benefit will be set at 14.

Minimum EI Benefit

The Government has also announced that it will set the minimum weekly benefit for EI regular benefits at $400 per week (if this is higher than what a claimant’s benefit would otherwise be).

EI Premium Freeze

EI premium rates paid by employees and employers will also be frozen for a 2-year period at the 2020 rates. For employees, this is $1.58 per $100 of insurable earnings; for employers, it is $2.21 per $100 of insurable earnings.


  1. NEW RECOVERY BENEFITS

With the CERB program coming to an end as of October 3rd, there will be individuals who remain unemployed or underemployed due to the pandemic but who will not qualify for EI, even with the new eligibility rules.  To address this gap, the Government has announced that it intends to introduce legislation providing three new recovery benefits, meaning a whole new set of acronyms to learn!

Canada Recovery Benefit (CRB)

The CRB is similar to the CERB; however, it would only be available to those who do not qualify for EI after September 27th. It would provide a benefit of $400 per week for up to 26 weeks. Like the CERB, claimants would need to demonstrate employment or self-employment income of at least $5,000 in 2019 or 2020 and must not have quit their job voluntarily.  The other CRB eligibility requirement is that the claimant either:

  • stopped working due to COVID-19 and is available and looking for work; or
  • is working and has a reduction in their employment/self-employment income for reasons related to COVID-19

The other notable feature of the CRB is that claimants would have to pay back $0.50 of the benefit for every dollar their net annual income exceeds $38,000 in the calendar year.

Canada Recovery Sickness Benefit (CRSB)

The CRSB will provide workers with $500 per week for up to 2 weeks, after September 27, 2020. It is intended for workers who are unable to work because of sickness or a requirement to self-isolate due to COVID-19.  It would be available to workers who earned at least $5,000 in 2019 or 2020 and would only be available to workers who have missed at least 60% of their scheduled work for the week in which it is claimed.  It would not be available if the worker is in receipt of other paid sick benefits for the same benefit period.  Workers would not need a medical certificate to apply but would have to attest that they meet the eligibility requirements.

Canada Recovery Caregiving Benefits (CRCB)

The CRCB will provide eligible Canadians with $500 per week per household for up to 26 weeks. This is intended to support Canadians who remain unable to work their regular hours or at all due to childcare or other dependent care constraints.  Claimants would have to demonstrate that they:

  • were employed or self-employed on the day immediately preceding the period for which the application is made;
  • earned at least $5,000 in 2019 or 2020;
  • were not in receipt of paid leave from the employer or CERB, EI, any other recovery benefit, short-term disability benefits or workers’ compensation in respect of the same week for which the benefit is being claimed;
    AND
  • have been unable to work for at least 60% of their normally scheduled work within a given week because they must take care of a child (under the age of 12) or family member with a disability/dependent:
    • because the child’s school or day care or the family member’s day program or care facility is closed or is operating under an alternative schedule due to COVID-19;
    • because the child cannot attend school or day care, or the family member/dependent cannot attend the day program or care facility on the advice of a medical professional due to being high risk if COVID-19 is contracted; or
    • because the caregiver who normally provides care to the child or family member/dependent is not available due to COVID-19;

We will continue to monitor government announcement regarding these or other benefits and update you accordingly.


  1. INFECTIOUS DISEASE EMERGENCY LEAVES (IDEL)

On a final note, just a reminder that if you have employees on lay-offs, or other absences, which were converted to Infectious Disease Emergency Leaves when the ESA was amended at the end of May by the Infectious Disease Emergency Leave Regulation (O Reg 228/20), then these IDELs will come to an end on Friday September 4, 2020.  You will need to decide what to do with these employees.

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Kalen Ingram
Posted September 3, 2020 Category: Businesses, Individuals/Families, News & Updates

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