There are a number of “social safety nets” in Canada. The most significant is the federal Employment Insurance system, which provides benefits in the event of a loss or interruption of employment.
Healthcare and Insurances
Citizens and landed immigrants have significant health care coverage, unemployment insurance coverage and pensions for retirement, generally covered by public funds and payroll taxes. Employment Insurance (“EI”) is available for Canadians who have lost their jobs. EI provides income replacement benefits for employees who have lost their jobs through no fault of their own. Therefore, EI is generally not available to employees who have been terminated for just cause. The current weekly benefit amount for a claimant is 55% of the average weekly earnings from the previous calendar year to a maximum weekly benefit of $537.
Employees are entitled to between 6 to 10 paid statutory holidays per year.
In all provinces, employees are entitled to at least two weeks of vacation per year. In many provinces, this entitlement will increase with an employee’s length of service.
Maternity / Paternity Leave
Maternity leave and parental leave are addressed under employment standards legislation in each province. EI is available for employees who are pregnant, have recently given birth, are adopting a child, or are caring for a newborn. Because EI benefits provide only a portion of an employee’s regular wages, many employers offer “top up” benefits to employees for some portion of their leave.
Many jurisdictions also provide a variety leaves based on illness, disability, or the illness or disability of a family member. Employers are generally not required to pay employees for these leaves of absence. Specialized EI coverage is also available for employees who are unable to attend work because of illness because they have taken a compassionate care leave to care for a family member who is gravely ill with a significant risk of death, or a leave to care for a critically ill child, though employers are not required to pay employees during these types of leave.
Each province provides some form of support for persons with disabilities who are in financial need, but this will only be available to persons who have significant long-term impairments that restrict their ability to work, care for themselves, or take part in community life.
Other Required or Typically Provided Leave
Each province in Canada operates a provincial workers’ compensation system which is, in effect, an insurance system. There is no federal workers’ compensation system and therefore, if eligible for coverage, employees in the federal jurisdiction are covered by the provincial workers’ compensation system that exists in the province in which they are employed, and participation is compulsory for employers. The system creates a trade-off, whereby employees injured on the job receive coverage, and in return, lose the right to sue their employers with respect to the injury.
Pensions: Mandatory and Typically Provided
Almost all individuals who work in Canada contribute to the Canada Pension Plan (CPP), which is a defined benefit plan. Employers are required by law to deduct and remit CPP contribution from employees’ income. Employers are also required to make contributions to CPP on behalf of their employees. Employees may apply for and receive a full CPP retirement pension at age 65. Alternatively, employees may receive a reduced pension at 60, or as late as 70 with an increase. Many employers and employees participate in workplace pension plans or group RRSP arrangements in order to supplement employees’ CPP entitlements.
Other Required or Typically Provided Benefits
Some common benefits include private pension programs, as well as supplemented health benefits (which cover costs of items or care that are not covered by Canada’s universal healthcare system such as prescription drugs or vision ware).