COVID-19 has brought about significant impact on Canadian economy and therefore resulted in considerable instability in the labour market, and many employees are at risk of dismissal. It is thus important for employees to understand how Employment Insurance (EI) has been affected and what benefits are available to them. As of September 27, 2020, there are some temporary changes to the EI program to help employees access EI benefits.
Current EI Benefit
Currently, claimants receiving EI will be eligible for a minimum benefit rate of $500 per week before taxes, or $300 per week before taxes for extended parental benefits. For applicants with higher average weekly earnings, they will still qualify for and can receive a higher EI benefit rate.
Premium Rate Freeze
The Canadian government is expected to freeze the EI insurance premium rates at the 2020 level for two years. In other words, the employee rate will remain $1.58 per $100 of insurable earnings, and the employer rate will remain $2.21 per $100 of insurable earnings in the next two years.
Minimum Unemployment Rate
A minimum unemployment rate of 13.1% applies to all regions across Canada starting August 9, 2020. If a region’s unemployment rate is higher than 13.1%, the higher actual rate will be used to calculate benefits. This means a recipient can receive at least 26 weeks of regular EI benefits.
Credit of Insurable Hours
Retroactive to March 1, 2020, EI applicants are expected to be granted a one-time credit of insurable hours. For regular EI benefits, the number of insurable hour credit is 300 hours, and for special EI benefits, including sickness, maternity/parental, family caregiver, or compassionate care, the credit is 480 insurable hours.
Reduced Insurable Hours
The reduced minimum unemployment rate also leads to the deduction of the number of insurable hours in order to qualify for EI regular benefits. For most claimants, the number is lowered to 420 insurable hours of work. Furthermore, in effect, claimants will now only need 120 insurable hours to qualify for EI benefits, because claimants will get the one-time credit of 300 insurable hours to help them meet the required 420 insurable hours of work. In addition, if the claimant received the CERB, the 52-week period to accumulate insurable hours will be extended.
Benefits Available for Those Not Eligible for EI
For those who are not eligible for EI, they can apply for the Canadian Recovery Benefit (CRB). The CRB will provide a benefit of $400 per week for up to 26 weeks. The eligibility criteria are that the worker must be are at least 15 years old, have stopped working as a result of the COVID-19 pandemic (other than by voluntary resignation), are available and looking for work or are working, have had a reduction in employment/self-employment income for reasons related to COVID-19, and had employment and/or self-employment income of at least $5,000 in 2019 or in 2020. CRB claimants have to reapply every two weeks and and attest that they continue to meet the requirements.
Stacey Reginald Ball is an experienced employment lawyer with Ball Professional Corporation. Our office is located in Toronto, Ontario, and handles various employment law matters, including wrongful dismissal. If you have questions regarding employment law issues, please call our office at (416) 921-7997 ext. 225.