Maternity leave is a set period of time a biological or adoptive mother can take off from work, while pregnant and after giving birth, to raise her newborn child. During this absence from work, you will receive a government benefit (EI) and your employer is required, by law, to hold your position while you are away. The amount of time you get from your employer varies by province and territory.
How (and when) to apply for maternity leave
To receive the EI maternity and parental leave government benefit, you have to apply and meet a set of criteria, including accumulating at least 600 hours of insurable employment. You must fill out an online application that will take about 60 minutes to complete. Once you begin the application, you have 72 hours to complete it. It's helpful to have the following information ready to submit:
- Details (names & addresses) of your employers in the 12 months, as well as the dates of employment
- Your address and social insurance number (SIN), plus any other parent if you're sharing the benefits
- Your mother's maiden name
- Bank details
- The expected or actual date of birth of your child
- If adopted, the date the child was placed with you and the name of the agency handling the adoption
Be sure to apply promptly after your last day of work. Waiting longer than 4 weeks after leaving work could risk losing eligibility for these benefits.
How much can you get while on maternity leave
Your maternity and parental EI benefits will be key in planning your maternity leave finances. The general rule is this benefit pays out around 55% of your income, up to a maximum amount. The province of Quebec is more generous, and you can get up to 75% of your income there. In both case you will be expected to pay tax on any benefits received.
These percentages of your income depend on how long you take a leave of absence. The first part of your absence will be your maternity leave and that can last for 15 weeks. Beyond those first 15 weeks, your benefit switches to parental benefits, which can last either the standard 35 weeks or extended into 61 weeks. If you choose the standard length, 50 weeks in total, you receive 55% of your average weekly insurable earnings. If you take the full 76 in total, then you will receive 33% of your average weekly insurable earnings.
To give you some idea of how much monetary benefit you could receive from the government, consider the maximum yearly insurable earnings amount is $54,200 (as of May 1, 2020). That means you would get a max of $573 per week under the standard 35 weeks parental benefit. Extended benefits would be $344 a week. Once you choose a duration, you cannot change mid-way.
EI maternity benefits:
Can be paid for a maximum of 15 weeks after actual date of birth.
EI standard parental benefits:
Can be paid for a maximum of 35 weeks.
EI extended parental benefits:
Can be paid for a maximum of 61 weeks.
Who is eligible for maternity and parental benefits?
While maternity benefits are only available to biological and surrogate mothers, who cannot work because they have given birth, parental EI benefits are available to both parents and can be shared. For example, a mother and partner can split the 35 weeks between them. So, in other words, a mother can go back to work after 10 weeks of parental leave and the other parent can use the remaining 25 weeks. This applies to both standard parental leave and extended.
Do low-income families receive more while on maternity leave?
If your annual income is determined by the government to be less than $25,921, you may be eligible to receive what is called the EI Family Supplement. This is an additional benefit that could increase your benefit rate to as high as 80% of your average insurable earnings. Either parent can receive this benefit, but if the recipient’s income rises the Family Supplement will decrease.
Preparing your finances for maternity leave
Losing over half of your income while on maternity leave can be a big adjustment and a shock to your finances. Especially when you consider having a child comes with a lot of new expenses – diapers, clothing, toys, professional photography, car seat if you drive – just to name a few.
Whether you’re having a baby with a partner or going it alone, try to work out a new monthly expenditure plan. If you’re with a partner, re-adjust how you balance your financial partnership. For example, if you were splitting the rent 50/50, they can take on a bigger percentage of that expense. Also, discuss with your partner ways you can save money. One easy solution is to target your entertainment budget. With a little baby in the house, you won’t be going to the movies or the nightclub as much anymore.
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