EI Benefits Upcoming for the Self-Employed?

The Government of Canada has introduced some proposed legislation under the Fairness for the Self-Employed Act which could provide the opportunity for self-employed individuals to access many of the same employment insurance benefits as employees. 

The legislation, recently announced by the Minister of Human Resources and Skills Development, The Honourable Diane Finley, forms part of the pledge for helping self-employed taxpayers with some much needed income protection for life events such as the birth of children, sickness and compassionate leave.

With over 2.6 million Canadians in the ranks of the self-employed and many more turning to starting their own businesses as they are facing lay-offs, the opportunity to receive employment insurance benefits for this sector of the work force couldn't be better timed.

In the January 27, 2009 Federal Budget, the Government brought forth a proposal to review alternative methods of providing those self-employed Canadians with access to benefits that, in the past, have only been available to those who were working for an employer.

Under the proposed legislation in the Fairness for the Self-Employed Act, in order to access the benefits, those workers who are self-employed would be required to earn a minimum of $6,000 from their business in the previous calendar year.  There would be an ìopt inî requirement to the EI program, and those who enrolled would be required to pay premiums into the plan for at least one year before they would be allowed access to the benefits available.  With a proposed start date of January 2010, those who chose to enrol in the plan at the beginning of the program could have access to the benefits beginning in January 2011.

The benefits that could be provided under the plan would include the following:

∑         Up to 15 weeks of sickness benefits to be provided if a person couldnít work due to injury or sickness

∑         Up to six weeks of compassionate care leave to those who need time away in order to care for members of their family who are at risk of death through illness

∑         Up to 35 weeks of adoptive or parental benefits available for parents with a newborn baby or an adopted baby in their care

∑         Up to 15 weeks of maternity leave benefits for mothers or those about to give birth to a child

As mentioned, premium payments to the EI benefits plan under the proposed changes  would be required for a minimum one-year period, after which benefits could be applied for.  If program benefits are accessed by the self-employed person, the individual would be required to continue making premium payments on their income for as long as they continued to be self-employed.  There would be an opportunity for the self-employed person to opt out of the program if EI benefits were not applied for or received. 

The EI premium rate paid would be the same as that of a salaried person.  In 2010 the amount remitted to the plan would total $747.36, based on maximum insurable earnings of $43,200. The employer side of the payment would not be required as the benefits available to the self-employed would be restricted in that there is no access to regular employment insurance benefits.

More information on the proposed measures is available at the Human Resources and Skill Development website at www.hrsdc.gc.ca.

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