When an organization expands into a new country, one of the long-term factors decision-makers need to consider is maternity and paternity leave—specifically, Canada. Canada is a popular target country for global expansion, and paternity, maternity, and general parental leave policies should be top of mind for expanding organizations.
What You Need to Know About Employment Insurance (EI) in Canada
With the sole exception of Quebec, all of Canada is covered by Employment Insurance plans that not only offer generous parental leave policies, but are also quite similar to what is offered in many European countries. Generally speaking, the amount received is calculated based on a person’s previous 52 weeks of employment, so long as those earnings were consistent. This includes not only wages but also bonuses, tips, and even commissions.
If a person’s weekly income varies, that’s okay; the amount received will then be calculated based on weekly income for the 14 to 22 weeks in which the amount was highest.
In terms of maternity leave, this is granted to the person who gives birth, including surrogates. People can get up to 15 weeks of compensation at 55% of their earnings, up to $562 per week. This can start anywhere between 12 weeks before the due date, and up to 17 weeks after the birth.
Parental leave—which includes situations like adoption placement in addition to a birth—is something available on top of standard maternity leave. This, too, gives employees 55% of their income at up to $562 per week, though each parent must choose the same option.
It’s also important to note that there are two different types of parental leave configurations to choose from depending on one’s needs. These include:
- Standard Parental Leave: can occur for up to 40 weeks in total, and 35 weeks maximum per person (with a minimum of five weeks per parent). They will get 55% of their earnings up to $562 per week, within 52 weeks of adoption placement or birth.
- Extended Parental Leave: grants someone up to 69 weeks in total, and 61 weeks maximum per person. Here, someone will get 33% of their earnings up to $337 per week and this must happen within 78 weeks of placement or birth.
It’s worth noting that either type of parental leave can be used by both parents at the same time or separately. Likewise, after approval of the application, there is always a one week waiting period. The first payment is, on average, received about 28 days after the application is submitted.
Quebec’s Parental Insurance Plan
As stated, Quebec does things a bit differently. Quebec’s Parental Insurance Plan offers maximum insurable earnings of up to $76,500. Its plan also has a few different configurations to choose from, depending on the situation, including:
- Maternity Leave: Granted to the woman who has given birth. Basic maternity leave is up to 18 weeks and 70% of average weekly earnings. Special leave is up to 15 weeks at 75% of one’s average weekly earnings. Both start between 16 weeks before and 18 weeks after the due date or birth.
- Paternity Leave: Exclusively for the father of the newborn. Basic paternity leave can be taken for up to five weeks at 70% of weekly earnings. Special leave is up to three weeks at 75% of weekly earnings. This starts between the week of the birth and up to one year after.
- Parental Leave: Can be up to 32 weeks at 70% of weekly earnings or for seven weeks at 55% of earnings for 25 weeks. Special leave is up to 25 weeks at 75% of weekly earnings. Both can start between the week of the birth and up to 52 weeks after.
- Adoption Leave: Designed to be shared between adoptive parents. For basic leave, one gets 70% of weekly earnings for up to 37 weeks, or 55% of weekly earnings for up to 25 weeks. Special leave is 75% of weekly earnings for up to 28 weeks. Both start between one week of the parents beginning official care (if they’re adopting outside of Quebec), or up to two weeks before care begins (if adopting in Quebec). They can also go up to 52 weeks after the birth.
Likewise, organizations should consider offering additional monetary benefits to top tier employees that go above and beyond what Canada parental leave currently offers. Not only is this a great way to tap into and attract a highly skilled workforce, but a perfect opportunity to guarantee that they’ll return once their leave is over.
Expand into Canada with an Experienced Expansion Partner
Canada’s parental leave policies offer expecting parents generous time off options—and ensuring your expanding organization is aligned with these policies is essential. Understanding these and other rules and regulations in Canada (or any other new market) can be overwhelming, and expanding businesses can benefit from partnering with an expert who knows Canada’s HR legislative landscape.
Velocity Global has partnered with hundreds of organizations to expand into more than 185 countries—and many into Canada. Whether helping make sense of parental leave policies or handling payroll and benefits, Velocity Global’s International PEO (Professional Employer Organization) solution streamlines the transition into new markets, virtually anywhere. If you’re considering Canada as the next stop on your global expansion journey, reach out to us today to learn how International PEO can have you up and running in Canada in a matter of days, not months.
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