Parental and Maternity Leave Top-Up Benefits
Having a child can be one of life’s most joyous milestones, yet for some, this anticipation is accompanied by feelings of financial stress and uncertainty of employment. Having a baby inevitably means time out of the workforce and many added expenses. Ensuring you are fully aware of your rights and understanding the support available to you is essential for a smooth transition to and from maternity leave and can help alleviate the financial pressures faced by many families.
On the flip side, it is also crucial for employers to evaluate or reevaluate their leave policies that support new parents and female workers. Having competitive pregnancy and parental leave policies can help companies attract and retain top talent.
What Is the Difference Between Maternity And Parental Leave?
Maternity leave, also known as pregnancy leave, is available to pregnant parents and it allows them time off during pregnancy, childbirth, and recuperation. Eligible Ontario employees are entitled to a maximum of 17 weeks of maternity leave. Parental leave is available to all parents for up to a maximum of 63 weeks. Mothers can add parental leave onto their maternity for a maximum of 78 weeks between maternity and parental leave. This allows parents to care for and bond with their new child. Employers are not obligated to pay employees while they are on maternity or parental leave, which is why top-up benefits play such an important role in family planning.
The Importance of Parental and Maternity Leave Top-Up Benefits
Top-up benefits are additional payments made by employers to supplement the standard benefits provided by Employment Insurance (EI) during pregnancy and parental leaves. These top-ups can significantly alleviate the financial strain on families, allowing parents to focus on nurturing their newborns without the added stress of financial instability. However, a recent report by Maturn highlights the reality that nearly 40% of Canadian mothers did not receive any employer financial top-up during their maternity leave. Of those who did, 59% were not offered additional support such as coaching programs, counseling, or childcare assistance.
Employers who offer comprehensive top-up benefits and support programs not only help their employees but also enhance their company culture and reputation through greater employee retention and morale. This can save time and resources in training new employees and build a culture of reciprocal loyalty. It’s a win-win.
Key Considerations When Seeking New Employment
If you plan to start a family one day, it is worth paying close attention to a potential employer’s maternity and parental leave policy, specifically any provisions regarding what top-up benefits are offered, how top-up is calculated, and which employees are eligible to receive these benefits. For example, some employers may require an employee to have a minimum amount of continuous service before they are eligible to take advantage of the benefits.
Job Security During Maternity Leave
Another source of worry for pregnant employees is job security while they are on leave. This worry is well founded because despite having laws that prohibit discrimination against pregnant employees, women continue to find their jobs eliminated during or upon return from their maternity leaves. This often occurs under the guise of “restructuring”. Maternity leave is protected, meaning employees should return to the job they had before they started their leave.
What is a top-up policy for maternity leave?
A maternity leave top-up policy is when an employer supplements the standard Employment Insurance (EI) maternity or parental leave benefits you receive through Service Canada. Since EI parental benefits replace only part of your weekly earnings, a top-up closes the gap. These parental and maternity leave top-up benefits reduce financial strain and allow parents to focus on their newborn or newly adopted child.
Can I get a top up on my maternity pay?
Yes, but only if your employer offers parental and maternity leave top-up benefits. Employers are not legally required to provide them, so some parents rely only on EI benefits. When available, top-ups are usually set out in workplace policies and may depend on accumulated employment benefits or a minimum service requirement before you qualify for the additional support.
Does parental leave affect maternity benefits?
Maternity leave and parental leave are separate, but they can be combined. In Ontario, maternity leave provides up to 17 weeks for birth parents. Parental leave, which can be standard or extended parental leave, lasts up to 63 weeks for either parent. Taken together, a mother can receive up to 78 weeks. EI benefits cover part of your earnings, and top-up benefits can help bridge the rest.
What does EI top up mean?
An EI top-up means your employer pays additional support on top of the employment insurance (EI) benefits you receive during maternity or parental leave. While Service Canada pays a percentage of your weekly earnings through EI parental benefits, a top-up ensures your income is closer to normal. These maternity and parental leave top-up benefits ease financial pressure during your leave period.
What is the average maternity leave top up in Canada?
There is no established average across Canada, as parental and maternity leave top-up benefits vary by employer. Some companies provide generous support, while others offer none. Many Canadian mothers receive no top-up at all.
Do you pay CPP on maternity top up?
When you receive maternity leave top-up benefits, they are treated as part of your weekly earnings during parental or maternity leave. Alongside employment insurance EI benefits, this income is considered part of your accumulated employment benefits. That means top-up payments help you maintain pension and other benefit contributions while you are away caring for your child.
What’s the maximum maternity leave payment?
Maternity leave provides up to 17 weeks of job-protected time off, with employment insurance benefits replacing a portion of weekly earnings. When followed by parental leave, whether standard parental benefits or extended parental benefits, the total can be up to 78 weeks. The maximum maternity leave payment depends on EI benefits and whether your employer provides a top-up policy to increase your income.
How to maximize maternity leave in Canada?
Maximizing maternity leave is about stretching both time and money. Start by deciding whether standard parental benefits or extended parental benefits through Service Canada fit your family’s needs; shorter leave with higher weekly EI benefits, or longer leave with lower weekly payments. Next, check if your employer offers maternity or parental leave top-up benefits and whether you qualify based on service. Parents can also split parental leave, allowing both to receive EI parental benefits while balancing income. Finally, review how accumulated employment benefits, such as vacation pay or other earned time, might carry you further.
Protecting Your Income and Your Future
The findings from Maturn’s report and the reality faced by mothers in the workplace underscore the need for systemic change in how Canadian workplaces support working parents.
Employers can create more inclusive and supportive environments that recognize the unique needs of modern families by creating competitive parental and maternity policies. This will promote long-term success for employees thereby contributing to the success of the company. If you are an employer considering creating or updating your workplace policies, consulting with an employment lawyer will ensure your policies work for you and your employees, while complying with employment and human rights laws.
If you are an employee and you feel like you are being treated unfairly because of your role as a parent, it is important to seek legal advice. Whitten & Lublin is here to help you understand your situation, what recourse is available to you, and how you can best look after yourself and your family.
If you need assistance, reach out to Whitten & Lublin online or by phone at (416) 640-2667.