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. Canada’s public health care system also greatly decreases the cost to employers of providing private medical insurance to employees, in comparison to countries without such systems. Participation in a government-run workers compensation program in each province is either mandatory or optional, depending on the type of work the employer is engaged in.
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. Most basic health care services are covered by provincial health insurance however, prescription drugs are not covered under the plan.
Employment Insurance (“EI”) provides income replacement benefits for Canadian employees who have lost their jobs through no fault of their own (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 $573.00.
Holidays and Annual Leave
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. If an employee is required to work a holiday, the employee is entitled to premium pay (typically time-and-one-half) as well as to holiday pay for that day.
Maternity and 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.
Sickness and Disability 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. Specialised 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.
Other Required or Typically Provided Leave(s)
There is no federal workers’ compensation system. If eligible for coverage, employees in the federal jurisdiction are covered by the provincial workers’ compensation system where they are employed. Participation is compulsory for employers. This creates a trade-off system, 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).