New parents in federally regulated sectors will be provided with job protection to care for a baby up to 18 months of age

THE PLAN

The birth of a new baby is an exciting time for all involved, especially moms and dads. It’s also a period of tremendous change for parents as they adjust their work and home lives to the new responsibilities of parenthood.

Our Conservative Government wants to support parents during this critically important period. Increasing job flexibility is one way to support moms and dads who want to spend as much time as possible with their babies as they grow and take their first steps. Some parents also see the transition to parenthood as a good time to pursue their entrepreneurial instincts.

That’s why a re-elected Conservative Government will expand Employment Insurance (EI) maternity and parental benefits and leave provisions in several ways to increase flexibility for new parents and encourage those with self-employment goals:

1. New parents in federally regulated sectors will be provided with job protection to care for a baby up to 18 months of age, allowing workers to take up to 6 months of additional unpaid leave.
2. Parents can opt to receive their EI parental benefits at the full rate for up to 35 weeks, or they can extend those payments at a lesser rate up to a maximum of 61 weeks. When combined with other EI maternity leave, this can provide parents with a stream of income for 18 months while caring for their babies.
3. A new two-year pilot project will be established to allow parents to earn self-employment income, without impacting EI maternity or parental benefits, up to 100% of the weekly EI maximum insurable earnings threshold.
4. Women receiving EI maternity benefits will also be able to earn employment income under the Working While on Claim pilot project. This is currently permitted for those receiving EI parental benefits.

This package of improvements to maternity and parental leave will make it easier for moms and dads to spend more time with their kids and will give them more choice and flexibility in how they manage their careers in those early days of parenthood.

THE ISSUE

1. 18 MONTHS OF JOB PROTECTION FOR NEW PARENTS

Under the current federal labour code, biological mothers are eligible for up to 17 weeks of maternity leave. Natural and adoptive parents are eligible for up to 37 weeks of additional parental leave. These two types of leave combined provide job protection to parents for the first year of a baby’s life.

A re-elected Conservative Government will provide natural and adoptive parents working in federally regulated sectors with up to an additional six months of unpaid parental leave.  When combined with existing maternity leave, this means that parents will have job protection to care for their children until their babies reach 18 months of age. The total combined maternity and parental leave taken by parents cannot exceed 78 weeks. Up to 17,000 federally regulated workers could benefit each year.

Amendments to the federal labour code to reflect these improvements will be introduced in 2016. We will also work with federal public sector unions to negotiate this additional unpaid benefit in collective agreements.  Although leave provisions for non-federally regulated workers remain under the jurisdiction of provincial and territorial labour codes, in the past, provincial and territorial governments have adjusted their parental leave provisions to match those of the federal government.

2. EXTENDING EI PARENTAL LEAVE BENEFITS

Each year, 170,000 women receive EI maternity benefits and 190,000 parents receive EI parental benefits. The number of dads who receive parental benefits has continued to increase, and is approximately 30% today[1].  Under the current rules, maximum EI parental benefits are 35 weeks. When combined with maternity benefits of 15 weeks, this allows parents to receive EI income for the first year of a baby’s life[2].

A re-elected Conservative Government will allow those on parental leave to receive their EI parental benefits at the full rate for a maximum of 35 weeks or to extend their payments at a lower rate for up to 61 weeks.  This additional 6 months of payments will allow parents to receive EI benefits for up to 18 months after their baby is born. These improvements to parental benefits will also apply to adoptive parents. If parents share their EI parental benefits, the total combined benefit period of maternal and parental leave cannot exceed 78 weeks.

3. SUPPORTING PARENT ENTREPRENEURS

As every parent knows, having a child is a life-changing experience.  People’s priorities often change when they become parents. Many moms and dad tell us that they would like to start their own businesses while they are on parental leave.

Under current EI rules, some parents are able to generate a limited amount of self-employment income while they are receiving EI parental benefits through the Working While on Claim pilot project.  That pilot program allows EI claimants to keep 50 cents of their EI benefits for every dollar earned, up to 90% of the weekly insurable earnings used to calculate benefits. Amounts over this 90% threshold are deducted dollar for dollar from their benefits.

However, other parents are unable to earn any incremental income from self-employment due to the way the Working While on Claim project is structured. Given the time and resources involved in starting a business – not to mention trying to do so while caring for a young child – parents who are not able to earn any additional income from starting a business are discouraged from even trying.

A re-elected Conservative Government will create a two-year pilot project that will allow parents receiving EI parental benefits to augment their EI income with self-employment earnings.  They will be able to earn a combined total from these two sources up to the EI maximum insurable earnings threshold, which will be $50,800 for 2016 or about $976 per week.  This initiative will offer parents the opportunity to augment their EI benefits by 45% or more with self-employment income.

For example, a worker who receives the maximum weekly EI parental benefit of $537 per week (55% of the maximum weekly threshold of $976) will be able to earn on average an additional $439 per week in self-employment earnings ($976-$537).

This two-year pilot project will begin in 2016 and will be limited to those receiving EI maternity and parental benefits, including those enrolled for EI special benefits for the self-employed. At the end of the pilot project, we will evaluate its success, and examine the impact that it has had on work patterns and small business creation. At that time, we will consider ways to expand the project further beyond new parents.  Additional costs to the federal government associated with the program are expected to be negligible.

4. EXPANDING WORKING WHILE ON CLAIM

At present, moms receiving EI maternity benefits can’t earn any employment income without negatively affecting their benefits. Any money earned while on leave must be declared to Service Canada, and it is then deducted dollar-for-dollar from EI benefits. These rules may preclude new mothers from maintaining clients or an attachment to the labour market, and may even force them to return to work earlier than they’d like.  However, other groups receiving EI benefits – including those on parental benefits – are eligible to receive Working While on Claim income.

A re-elected Conservative Government will extend the Working While on Claim pilot project to include women receiving EI maternity benefits.  Up to 34,000 women are expected to benefit from this initiative each year at a cost of $2M[3].

The current Working While on Claim pilot ends in August 2016, at which time it may be extended or modified.  A re-elected Conservative Government will ensure that Working While on Claim provisions remain in place for those receiving EI parental and maternity benefits in order to align with the self-employment pilot project outlined above.

Those receiving EI sickness benefits will not be eligible for the program.

THE CHOICE

Our Conservative Party’s commitments are fair and affordable. They will provide new parents with additional flexibility, and will allow those who are interested in starting new businesses to do so – all without raising taxes on Canadians. In fact, we will deliver these improvements for parents while lowering taxes even further.  Our 2017 EI premium rate is expected to be $1.49 per $100, a 21 percent reduction, and will benefit more than 16 million Canadians.

The Liberals and NDP would instead impose billions of dollars in higher payroll taxes on Canadian workers. The NDP will hike EI premiums to $1.88 per $100, while the Liberals will increase them to $1.65 per $100. All told, the NDPs EI promises will result in $5.3 billion in additional payroll taxes while the Liberals will cost Canadians $2.2 billion in EI-related payroll hikes. Their plans will cost  average Canadian families hundreds of dollars each and every year – and they will kill jobs.

Our Conservative Party’s plan will provide parents with more flexibility, and greater opportunity to earn and create their own income, without raising taxes.