Posted on November 27th, 2018 in Domestic Tax, General Business

RETAINING EMPLOYMENT INSURANCE (EI) BENEFITS: Starting Part-Time Work

business people in a meeting

As of August 12, 2018, the “Working While on Claim” program became a permanent part of the EI system. Prior to the program, an individual could earn a very low weekly amount, after which the EI benefit would be eroded on a dollar for dollar basis of earnings. Under the new rules, a person who earns income while receiving EI benefits can keep $0.50 of their EI benefits for every dollar earned, up to 90% of their previous weekly earnings. Above this 90% cap, EI benefits are reduced dollar for dollar. An individual who works a full work week is ineligible to receive EI benefits.

This program is available for the following types of EI benefits: regular, sickness, parental, maternity, fishing, compassionate care, and family caregiver benefits for adults and children. Self-employed individuals opting into the EI system are also eligible for this program.

Action Item: This may provide an attractive opportunity for employees on maternity or parental leave to return to work on a part-time basis.

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Article originally published in: Tax Tips & Traps 2018 Fourth Quarter – Issue 124.