Changes to EI and What They Mean for Additional Earnings While On Parental Leave

By Megan McChesney

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Photography from iStockphoto.com

Posted: April, 2012

In the recent federal budget, some changes were announced to the rules around additional earnings while collecting Employment Insurance (EI), so we went to the fine folks at Human Resources and Skills Development Canada to get some clarification.

At the moment, the rules stipulate that you can earn up to 40 percent of your EI weekly amount or $75 per week (depending on how much EI you collect) without any penalty to the amount of EI you receive. Anything you earn above that amount is deducted from your weekly EI payments, dollar for dollar.

On August 5th, 2012, however, all of this is going to change. In a bid to encourage those who are off work to continue to seek and accept paid employment, they’ve reduced the clawback amount to 50 percent instead of 100 percent, but there is no penalty-free threshold. So, for any additional dollar you earn while on EI, they will deduct 50 cents from your EI payment.

An example: let’s say you collect $300 per week from EI while you’re on parental leave. If you do some additional work for which you’re paid $100, they will deduct $50 from your EI payment, so your total for that week will be $350.

Get it?

These new rules apply to anyone collecting EI, regardless of the reason. And as of this post being written, the new rules aren’t yet on the Service Canada website, but it’s likely just a matter of time, so keep checking back.

 

 

 

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