How Maternity Leave Works in Canada

Maternity leave is a hot topic in the U.S. so I thought I would outline how the Canadian system works so you have an accurate comparison.

via rantswithintheundeadgod

via rantswithintheundeadgod

A while ago I posted an article on Facebook entitled A Plea to Our Presidental Candidates for Paid Family Leave and I was surprised at the feedback. So many people were commenting how the government couldn’t afford to provide that benefit and how many people would take advantage of it.

I had a little Aha Moment and realized that on the surface maternity benefits looks like free money handed out to anyone claiming they had a baby. So I thought I’d put together a post on how the system works up here in Canada. I had Claire do all of the research because she’s American so she’d be better at spotting the differences (plus, I like reading government websites about as much as a rectal exam.)

The quick and dirty summary of Canadian maternity leave is that the government provides, at minimum, partial income to a family for almost a year after a baby is born, as well as a guarantee that your job will be waiting for you at the same pay when you return. Yah, I know. Pretty different from the U.S., where you typically get (maybe) 12 weeks unpaid.

How does Canada make this magic happen? The maternity leave portion is required by Canadian labour code, specifically that women who have just given birth get up to 17 weeks of unpaid maternity leave and leave can start as early as eight weeks before baby is due. Mom’s job must be waiting for her at the end of leave with the same pay and benefits. Huzzah!

Separate from maternity leave is a 35 week parental leave that can be taken by either parent and the time may be split between the two parents. Tack that 35 weeks of parental onto the 17 weeks of maternity leave and someone can be home with babe for a whole year!

As for collecting leave benefits (cash money) while you’re out, that has to do with Employment Insurance (EI). So no, it’s not free money from the government — Canadians pay into their own leave every month and then you can basically cash out your insurance policy when you have a baby.

To be eligible for EI benefits you need to:

  1. Be enrolled in Employment Insurance (if you work at a company this happens automatically.)
  2. Meet the criteria for EI, e.g. be the biological, adoptive, or legally recognized parents of a newborn or newly adopted child (I could not claim my taco bowl belly as a baby and get away with it.)
  3. Have your weekly wages reduced by more than 40% because of that baby at your house (You can’t claim your whole paycheck while you are off, however, some companies will top you off which is a total perk and a way many employers sweeten the pot to score great talent.)
  4. Have worked 600 insurable hours in the year before you claim the leave benefits (You can’t show up on your first job, first day of work and say “I’m giving birth tomorrow. See ya dorks!”)

If you qualify for EI then you, the employee, pay into it with every paycheck. Also, there is a maximum benefit you can receive. The amount you will receive is equal to 55% of your average weekly pay up to a maximum amount set by the government. In 2016, the max insurable amount for a year is $50,800.

So basically, if you are enrolled in EI then your Canadian employer will deduct money from each of your paychecks until your annual earnings reaches the maximum yearly insurable amount of $50,800. If you’re a baller and made way more than $50,800 before your leave, all you can claim is 55% of that max amount, which comes out to about $537 per week while you’re home bonding with baby.

I’m pretty sure that it’s not a perfect system but I would argue that it’s a pretty good one. Not only do parents get to spend more time with their kids if they choose to, but freelancers and part-time workers are constantly employed by maternity leaves.

Honestly, I think many American families have just come to accept that this is the way it is – I’ll read comments like, “well, it was my choice to have a baby” – but I really do think that you deserve better. And I don’t just mean as a family, I mean as a country. You guys are creating the people that will run your country and wipe your old bums one day and I think parents should have more flexibility when it comes to raising them.

That’s just my Canadian opinion, though. I’m still jealous of your Targets, Trader Joe’s and inexpensive alcohol, so I’m not about to get all smug about it.

This great TED Talk from Jessica Shortall, The American Case for Paid Maternity Leave that also inspired me to pull out my soapbox and rant at my husband even though it affects him in no way shape or form. It’s worth a watch.

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  • What happens to the folks that pay into EI and dont have a baby? What else can they use it for? is it like unemployment?

    • EI is employement insurance, so if you lose your job, you can claim EI while you search for a new job. There is a limit on how much and how long it will be paid out for! It’s meant as a bridge between your old job and a new job so you don’t end up on the street!

  • If the pay is being taken out of their paycheck each month to pay for the EI insurance (if they qualify), Americans could replicate the same thing and just set aside money each paycheck and either put in a mutual fund if it is going to be a few years before you have kids or just put it in a savings account.. Then you can fund your own maternity leave. It’s basically the same as self insuring. It just takes some planning a discipline not to touch that money if other things come up. That doesn’t address the job security after 12 weeks but you could at least afford to take the full 12 weeks if you save ahead of time.

    • Except the US is not required to guarantee your job after 12 (if that) weeks… so, you would be essentially unemployed. So you STILL don’t win…

  • Yay Canada! But here’s another tidbit worth considering: It isn’t just to stay home and play with baby. It’s also to foster good development (blah blah blah), but ALSO (or perhaps more) important – we don’t have national childcare (although Yay Quebec), so staying home means saving the $1,000 per month (even more if you keep your other kids home too). It also saves my sanity because I couldn’t stand to have the grandparents pitch in.

  • We have something similar, on a much smaller scale, here in RI. We have TDI automatically deducted from our pay checks. It’s temporary disability insurance, which can be used for any illness/disability that keeps you out of work (and must be verified by a doctor). Women get 6 weeks for birth (+2 weeks for c-section, I think). Then a few years ago, they added 4 weeks of bonding for moms AND DADS (!!!) and called it Temporary Caregiver Insurance & also applies to adoption. So out of my 13 (RI gets an extra week) of "unpaid" FMLA, I really got paid for 10 weeks. I think its something like 70% of your normal pay rate, but TDI is non-taxable (TCI you pay the taxes at the end of the year) and add in the fact that your regular payroll deductions (insurance, 401k, etc) aren’t taken out, it’s not too shabby.

  • How does this policy work if you have have a few kids over a few years? Does a certain amount of time have to pass before this benefit is available for the next child?

      • This is correct!

        I had a co-worker get pregnant only 2 or 3 months after the birth of her first child (????!!!!) and she had to come back early to make sure she had 600 hours in before her next maternity leave. I don’t think you get to take your original leave on top of your new leave, either… I think once you’re back to work, that’s it.

  • I hate how in every discussion of parental leave in the U.S. someone always throws the "choice" flag. Yeah, okay, on the one hand, it IS a choice. But on the other hand, SOMEONE has to have and raise babies, otherwise society collapses and the species dies out. I know some people would be okay with that scenario. I’m not saying parents should be revered as anything special, but the whole choice argument is so ridiculous.

  • As a Canadian mom currently at home on month nine of my maternity leave I am starting to get nervous about going back to work in three months. I am deeply grateful for our system, never more so than when I read the plight of the average American preparing to go back after 12 weeks!!! I am an educated professional who has been in the full-time workforce for over 10 years so I certainly have paid my share of employment insurance. I am also fortunate to work for the federal government who tops up my wages. In the end I am at home making 97% of what I made prior to maternity leave which allows me to be at home and raise my family without worrying about finances. Any country can have the same benefits but they have to be willing to pay for what is often perceived as a "socialist" state. In return you get free healthcare and amazing benefits like paid parental leave.

    • Some of us get less. I only got 9 weeks with my weeble before I had to go back to work. We are guaranteed 12 weeks unpaid, but most of us can only afford a few weeks before the money runs out. I only got 9 weeks paid because of how my company works. I pay $10 a paycheck to short term disability, and when I take maternity leave they pay 60% of my average paycheck for 6 to 8 weeks. I got 8 weeks paid because I had a c-section. The last week was my paid vacation.

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