Improving Maternity and Parental Benefits

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According to NAWL’s vision, every mother should receive income replacement and material support during the first years of caring for a child. Bearing and raising children should not impoverish women, as is now the case.

No single initiative is sufficient to drastically improve the situation of all mothers in Canada. Nonetheless, several areas of the law cry out for reform by the Federal government. Presently, a parent’s right to temporarily absent herself (or himself) from work as well as the details of her (or his) return to work are covered by provincial employment standards legislation or, in the case of workers in sectors under federal jurisdiction, by the Canada Labour Code. Unless parents live in Québec, maternity and parental benefits are granted through the federal regime set up by the Employment Insurance Act (EI Act).

As of 2001, in order to be eligible for these maternity and parental benefits, a person must have accumulated 600 hours of insurable employment during the last 52 weeks. Women that have given birth are eligible for maternity benefits, while either parent, including adoptive parents, are eligible for parental benefits. With the exception of the few who qualify for the family supplement, benefits represent only 55% of insurable income and are taxable. The maximum insurable earnings have been frozen at $39,000 per year since 1996, as has the maximum weekly benefit of $413. A waiting period of two weeks is imposed on one parent, usually the mother, as she is almost always the first parent to draw benefits.

As of January 2006, the Québec Parental Insurance Plan offers much more generous benefits to a much broader group of new parents, including self-employed parents and the second parent in same-sex families. We think it is time that some key elements of the Quebec plan were introduced into the EI Act so that mothers and fathers in the rest of Canada can benefit from similar improvements.1 Society as a whole benefits in a particular and unique way from childbearing and childrearing. The Supreme Court decision in the Reference re Employment Insurance Act underlines this fact, stating that, “Children are one of society’s most important assets, and the contribution made by parents cannot be overstated.” According to the Court, “An interruption of employment due to maternity can no longer be regarded as a matter of individual responsibility”. At the same time, the decision states that: “the social nature of unemployment insurance requires that Parliament be able to adapt the plan to the new realities of the workplace”.2

We therefore recommend that the current federal benefit regime be expanded through the development of specific rules within EI for workers who apply for maternity and parental benefits. This would bring Canada into line with the 2003 recommendation of a United Nations Committee on Discrimination against Women. This committee recommended that Canada reform maternity and parental benefits so that they cease to be a source of inequality for women.3 And given that society as a whole benefits from the work parents do raising young children, we recommend that the Federal government contribute directly to financing this much-needed expansion to the current maternity and parental benefit regime.

During NAWL’s consultations on maternity and parental benefits, many participants insisted that all mothers need support, whether or not they have been doing the kind of work that allows them to qualify for EI benefits. We came to the conclusion that a complementary universal support program that reaches mothers who do not qualify for benefits under EI or receive inadequate benefits under that program is also essential. This kind of support program relies on the Federal Government’s spending power to support families with new babies or newly adopted children. At the same time, we recognize Québec’s right to determine its own social policies and thus to opt out of any such program with full financial compensation, if it so wishes.

Finally, it is impossible to examine the practical difficulties associated with the current maternity and parental benefits program without touching on the question of employment standards governing leave and the right to return to work after maternity and parental leave. Even if these standards generally fall under provincial jurisdiction, the Federal government should show leadership on this question by setting an example through the standards set out in the Canada Labour Code.

In Canada, becoming a mother has a dramatic effect on women’s economic well-being. If these women are — or become — single mothers, they and their children risk a significant drop in their standard of living. For women who already have low incomes such as many Aboriginal women, women with disabilities and women of colour, the outcome can be grim.

As we previously stated, no single initiative will be sufficient to correct this situation. However, improving maternity and parental benefits under EI is one critical place to begin reforming the law in order to stop making women pay such a high price for becoming mothers. Employment standards are another problematic area because the law inadequately protects mothers (and fathers) who temporarily stop working to take care of young children.

Amendments to the Canada Labour Code are long overdue, as are efforts to harmonize provincial employment standards legislation with respect to maternity and parental leave.

NAWL believes that if the recommendations put forward in this document were implemented, this would be a good first step towards a social policy that is genuinely supportive of families with young children in Canada. In the meantime, mothers continue to pick up the slack, at the price of their own economic independence. For more information about NAWL’s position on Improving Maternity and Parental Benefits, please visit our website at nawl.ca.
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For over 10 years, Rachel Cox has been doing research and action-research in the area of labour and social law, often in collaboration with women’s groups. She is a member of the NAWL working group on maternity and parental benefits.

1 – When we use the term “mothers”, we are referring to co-mothers in same-sex families as well as mothers in opposite-sex families. Similarly, the term “fathers” includes co-fathers in same-sex families as well as fathers in opposite-sex families.
2 – Reference re: Employment Insurance Act (Can.), [2005] 2 S.C.R. 669, para. 54 and 66.
3 – United Nations Committee on Discrimination against Women’s Concluding Observations on the Occasion of Canada’s 5th Report (CEDAW/C/CAN/5 and Add.1), 603th and 604th sessions, January 23, 2003 (see CEDAW/C/SR.603 and 604), para. 382.

NAWL’S RECOMMENDATIONS for Improving Maternity and Parental Benefits

1. Expansion of the current maternity and parental benefits regime under EI
NAWL recommends that the Federal Government expand the current maternity and parental benefits regime under EI and that it finance this expansion through direct contributions to the EI Fund. NAWL recommends that the Federal government:
• Abolish the waiting period for workers receiving maternity and parental benefits;
• Convert this two-week period to a period of eligibility for parental benefits;
• Increase benefit levels for maternity and parental benefits (and all other benefits) to 70% of regular earnings;
• Raise maximum yearly insurable earnings to $51 748, to be indexed annually;
• Calculate benefits on the basis of the best 12 weeks of income in the last year in all regions of Canada;
• Create a family supplement of $25 per week for one child and $35 for two or more children for all EI beneficiaries, regardless of family income;
• Lower the eligibility requirement to 360 hours for maternity and parental benefits;
• Respect a distinct entitlement to maternity and parental benefits so that the right to these benefits is not affected by receipt of regular benefits;
• Designate benefits for fathers and second parents;
• Allow a 3 to 5 year reach-back period to qualify for maternity and parental benefits;
• Extend coverage to self-employed mothers and fathers.

2. Creation of a Universal Support Program
NAWL recommends that the Federal Government create a Universal Support Program that reaches mothers who do not qualify for benefits under EI or receive inadequate benefits under that program. At the same time, NAWL recognizes Québec’s right to determine its own social policies and thus to opt out of any such program with full financial compensation, if it so wishes.

3. Updating the Canada Labour Code
NAWL recommends that the Federal government show leadership on the issue of employment standards governing leave and the right to return to work after maternity and parental leave by setting an example through the standards set out in the Canada Labour Code.

Rachel Cox