Changes to Employment Insurance (EI) Regulations, including a reduction of the waiting period from two weeks to one week, came into effect on January 1, 2017. The waiting period reduction applies to both regular and special (i.e., maternity, parental, compassionate care, parents of critically ill children, and sick) benefits. The new waiting period does not change the maximum number of weeks of benefits payable to a claimant or the speed in which the first payment is received, but it does reduce the unpaid period until the first paid benefit is applied. For example, under the old rules a claimant was entitled to 17 weeks of maternity benefits (2 week waiting period and 15 week paid benefit period); under the new rules a claimant is entitled to 16 weeks of maternity benefits (1 week waiting period and 15 week paid benefit period).
The shorter waiting period may create ambiguity with short term disability (STD) plans, supplementary unemployment benefit (SUB) plans, top-up plans and long term disability (LTD) plans which often contain specific and explicit language regarding the EI waiting period. Since both SUB and top-up plans must meet specific rules to qualify under the EI Regulations it is important for employers to review their plans to ensure they are still compliant and that the number of weeks of benefit is aligned with the payments under the plan.
The draft EI Regulations include a four-year transition period to allow for revisions to current SUB and top-up plans to ensure they do not exceed the limits for combined benefits in the week immediately following the one week waiting period. This transition period will end on January 3, 2021.
You should review your STD, LTD, SUB and top-up plans to determine the impact of the reduced waiting period, develop a strategy for administering the plans during the transition period, and identify what changes, if any, are required.
As always Pesce & Associates is here to help should you have any questions or require assistance in reviewing and updating your current leave policies. Please reach out to your P&A Consultant or Elizabeth Hill, Managing Partner firstname.lastname@example.org or 416-491-1501 Ext. 22.