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Employment Benefits Quiz

QUESTION

What is the Canada Emergency Response Benefit (CERB)?

ANSWER

The CERB is an income support program for workers who have stopped working as a result of the COVID-19 pandemic. It will provide $2000 per four week period for any worker who is out of work for 14 consecutive days in the first four week period and out of work completely in the subsequent four week periods or received regular EI benefits for at least one week since December 29, 2019 and are no longer eligible for EI benefits. This benefit will be available from March 15, 2020 until September 26, 2020.

Individuals should not apply for both employment insurance (EI) and the Canada Emergency Response Benefit (CERB).

GENERAL

Employment Benefits

Benefits are an important part of an employee’s compensation package. Some elements of a benefits package are legislated, while others are offered to be competitive.

Legislated employee benefits

Legislated benefits are mandatory—all employers in Ontario must provide these benefits to employees. These benefits include:

Competitive employee benefits

While it’s important for Ontario employers to offer a competitive benefits package to attract and retain quality employees, a full suite of benefits can be cost-prohibitive for a startup. The costs of employee benefits will usually average about 15% of payroll in a small company, or as high as 30% in a larger one.1 Each potential benefit should be considered and defined carefully.

Competitive employee benefits commonly include:

  • Health insurance (e.g., coverage for medications, physiotherapy, upgraded hospital care)
  • Employee assistance programs
  • Vision care
  • Dental insurance
  • Life insurance
  • Additional vacation allotments above that required by the Ontario Employment Standards Act
  • Paid sick days
  • Short-term disability insurance (Tip:Investigate the disability coverage provided under Employment Insurance and Canada Pension Plan to determine if additional coverage is needed)
  • Long-term disability insurance (Tip:This should be paid by the employee. It saves the employer money, but, more importantly, the employee will not be taxed on the benefit should they ever need to claim it)
  • Group RRSP or pension plans (separate from Canada Pension Plan)
  • Education and training
  • Flexible work arrangements

WHY IS IT RIGHT

ENTITLEMENT TO EI BENEFITS

To be entitled to receive regular EI benefits, you need to have lost employment through no fault of your own.

If we consider that you are responsible for the loss of your employment, you may not be entitled to receive EI benefits. Here are a few examples of situations in which you may be considered to have been responsible for the loss of your employment:

  • you left your employment voluntarily and without just cause (you did not consider all the reasonable alternatives available to you to keep your job);
  • you were dismissed for misconduct (it was determined that you voluntarily or deliberately committed an inappropriate action, a violation, or professional misconduct); or
  • you are unemployed as a result of a labour dispute in which you participated, whether it is a strike, a lockout, or other type of dispute.

However, you may not be responsible for the loss of your employment if:

  • your employer ended your employment, but it was not as a result of misconduct on your part; or
  • you left your employment for reasons that could be considered just cause for leaving the employment (for example, harassment, discrimination, or dangerous working conditions).

In these cases, you may be entitled to receive regular benefits if you meet the eligibility criteria.

How many hours of insurable employment do I need to qualify for regular benefits?

It depends on your situation. However, in all cases, the hours of insurable employment that are used to calculate your benefit period must have been accumulated during your qualifying period.

Qualifying Period

The qualifying period is the shorter of:

  • the 52-week period immediately before the start date of your claim; or
  • the period from the start of a previous benefit period to the start of your new benefit period, if you applied for benefits earlier and your application was approved in the last 52 weeks.

Exception to the Qualifying Period

In some cases, the qualifying period may be extended to a maximum of 104 weeks if you were not employed in insurable employment or if you were not receiving EI benefits.

You will need to have accumulated between 420 and 700 hours of insurable employment during the qualifying period to be entitled to receive EI regular benefits.

Ready, willing, and capable of working each day

To receive EI benefits, you need to show that you are ready, willing, and capable of working each day.

Being “ready to work” means that your conduct shows your desire to work, but you have been unable to find a job.

Being “willing to work” means that you are actively seeking and willing to accept all types of work that your abilities, skills, training, or experience enable you to do. The wages you are expected to accept may vary depending on your past usage of the EI program and the length of your unemployment.

Being “capable of working” means that you are, first of all, able to work. Ability to work is characterized by the physical and mental strength required to perform the duties of an employment under the same conditions as workers who usually do that type of work.

Premiums Paid Into the EI Account

If you are employed in insurable employment, your employer will deduct the applicable EI premiums from your wages or salary, regardless of your age. These premiums go into the EI Account. There is no minimum or maximum age for paying EI premiums.

You will pay premiums on all your earnings until your annual earnings reach the established maximum amount. In 2018, this means a deduction of $1.66 for every $100 of earnings, until your annual earnings reach $51,700. The maximum amount of premiums to be paid in 2018 is therefore $858.22.

Employment Insurance (EI) if an employer reduces hours of work?

You can’t get EI regular benefits unless you had to stop working. It’s not enough if your hours have only been reduced.

But you may be able to get EI sickness benefits if you have to work fewer hours. You’re likely eligible for EI sickness benefits if your income goes down by at least 40% because:

  • you’re sick, injured, quarantined, or pregnant, or
  • you have to care for a child or family member with a serious medical condition.

How much you’ll get from EI depends on:

  • the number of hours you worked in the year before you apply
  • the unemployment rate in the region where you live at the time you apply

WHY IS EVERYTHING ELSE WRONG

THE CANADA EMERGENCY BENEFIT RESPONSE (CERB)

The federal government has indicated they will be providing a new benefit to support people who have lost their income due to the COVID-19 pandemic. This benefit is called the Canada Emergency Response Benefit (CERB). This benefit is not intended to replace Employment Insurance (EI), but rather to support workers who may not be eligible for EI.

Individuals who are eligible for Employment Insurance regular or sickness benefits, or who have recently exhausted Employment Insurance regular or fishing benefits may also be eligible.

Qualifications

The CERB is available to any worker that has stopped working due to COVID-19 and does not qualify for other income supports. This applies to any worker who, for reasons related to COVID-19:

  • Is out of work due to:
    • Having been laid off or terminated;
    • Being sick, quarantined, in self-isolation or taking care of someone who is sick with COVID-19;
    • Being working parents who must stay home without pay to care for children due to school and/or daycare closures.
  • OR
  • is continuing to work but receiving less than $1000 (before taxes) from employment or self-employment income;OR
  • received regular EI benefits for at least 1 week since December 29, 2019 and are no longer eligible for EI benefits.

Extra 8 Weeks Available

CERB has been extended from 16 weeks to 24 weeks for workers who:

  • stopped working due to COVID-19, or
  • are eligible for Employment Insurance regular or sickness benefits, or
  • have exhausted their Employment Insurance regular benefits or Employment Insurance fishing benefits between December 29, 2019 and October 3, 2020, and
  • meets all other eligibility criteria.

Part–Time Workers

The CERB has been expanded to now include workers who are out of work completely, workers continuing to work but earning less than $1000 (before taxes) per four week period and workers who were accessing EI regular benefits but are no longer eligible for EI benefits.

Taxable or not Taxable

The CERB is a taxable benefit. However, the government has indicated that taxes will not be deducted at this time. You will need to report any payments received on next year’s tax filing. An information slip will be made available for the 2020 tax year in your My Account section (on the CRA website) under Tax Information Slips.

Question in Application

  1. You did not apply for, nor receive, CERB or EI benefits from Service Canada for the same eligibility period;
  2. You have not quit your job voluntarily;
  3. You resided in Canada;
  4. You are 15 years old or more when you apply; and
  5. You earned a minimum of $5000 income in the last 12 months or in 2019 from one or more of the following sources:
    • Employment income
    • Self-employment income
    • Provincial or federal benefits related to maternity or paternity leave.

Employment Insurance (EI), or the Canada Emergency Response Benefit (CERB)

If you have applied for EI, you do not need to apply for CERB. Your claim will be automatically assessed for processing under the CERB program.

If you believe you will meet the eligibility requirements for EI, you may continue to use that application even though you will receive the same amount of money. This will establish your EI claim for following the 16 week period.

If you do not believe you would be eligible for EI but would be eligible for CERB, apply directly for the CERB.

You should only apply for one of these programs.

Sick and Quarantined

Sick and quarantined due to COVID-19, apply for Employment Insurance (EI)

Doctor’s Note

The requirement for a doctor’s note will be waived for EI and there is no requirement for a doctor’s note for CERB.

Employment Insurance (EI) benefits changes

Maternity, parental and caregiver benefits will continue to operate as they have.