REFERENCE GUIDE To Canadian Benefits | 2020 - Gallagher
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REFERENCE GUIDE To Canadian Benefits | 2020
Table of Contents
SUMMARIES OF UPCOMING ENHANCEMENTS FOR THE CPP........3 WORKERS’ COMPENSATION BENEFITS.............................................. 13
Phase 1—Increasing Employee and Employer Contributions...........3 MATERNITY AND PARENTAL LEAVES AND THE REQUIRED
SUMMARIES OF UPCOMING ENHANCEMENTS FOR THE QPP.......4 EXTENSION OF GROUP BENEFITS ....................................................... 14
CANADA PENSION PLAN/QUEBEC PENSION PLAN/OLD A NOTE ON OTHER FEDERAL AND PROVINCIAL LEAVES
AGE SECURITY..............................................................................................5 OF ABSENCE................................................................................................ 14
Maximum Monthly OAS Benefits...................................................................5 TAXES............................................................................................................ 22
Contributions 2020...............................................................................................5
Sales Tax on Group Insurance Plans..........................................................22
Maximum Monthly Benefit 2020.................................................................. 6
Employer Contributions to Group Benefits...........................................22
Maximum Contribution Limits for RRSPs, and
Premium Tax..........................................................................................................23
Defined Contribution RPPs and DPSPs..................................................... 6
Harmonized Sales Tax (HST).........................................................................23
Withholding Tax......................................................................................................7
CPP/QPP Disability Benefits.............................................................................7 PROVINCIAL MEDICARE PROGRAMS................................................. 24
EMPLOYMENT INSURANCE.......................................................................8 Hospital Coverage..............................................................................................24
Out of Country.....................................................................................................24
Regular, Sickness and Family-Related Benefits..................................... 8
Medical Care..........................................................................................................24
Premium Rates for EI—All of Canada, Except Quebec...................... 9
Prescription Drugs (Out of Hospital)........................................................24
Premium Rates for EI—Quebec..................................................................... 9
Quebec Parental Insurance Plan (QPIP)...................................................10
Premium Reduction Program......................................................................... 11
Reminder About the Premium Reduction Program (PRP)
and Applicable Transition Period ................................................................12Summaries of Upcoming Enhancements for the CPP
2020 Canada Pension Plan Enhancements Phase 1—Increasing Employee and Employer Contributions
Under the enhanced CPP program, the contribution rate will gradually
Announced January 2019, the Canada Pension Plan (CPP)
increase from 4.95% to 5.95% over the next four years.
contributions will gradually increase over a seven-year period. Today,
CPP benefits replace about 25% of employees’ pre-retirement income Employee/Employer Self-Employed/Total
up to an annual maximum. Under the enhanced plan, they’ll replace Year Contribution Contribution
closer to 33% up to the maximum. 2020 5.25% each 10.50%
2021 5.45% each 10.90%
What Are the Major Changes to CPP?
2022 5.70% each 11.40%
Eligibility guidelines for CPP will stay the same under the enhanced plan.
2023 5.95% each 11.90%
However, the amount employees and employers contribute will increase,
and these higher contributions will result in higher retirement, disability Employees and employers contribute on employment earnings
and survivor benefits. The CPP enhancement will be gradually between $3,500 and the annual pensionable earnings limit, which is
implemented in two phases over the next seven years. Phase 1 will go adjusted each year. In 2020, the annual pensionable earnings
from 2019 to 2023 while Phase 2 will commence in 2024. This summary maximum increases to $58,700 (from $57,400 in 2019).
will focus on Phase 1 information and will be updated with Phase 2 as we The CPP will undergo additional contribution changes in 2024. We
get closer to 2024. will provide an update on this information as we get closer to the
effective date.
For more information, please visit the Government of Canada website: https://www.
canada.ca/en/revenue-agency/news/2018/10/the-canada-pension-plan-enhancement--
businesses-individuals-and-self-employed-what-it-means-for-you.html
3Summaries of Upcoming Enhancements for the QPP
2020 Quebec Pension Plan Enhancements Also similar to the CPP, the QPP will undergo additional contribution
changes in 2024. We will provide an update on this information as we
Similar to CPP, starting January 1, 2020, the Quebec Pension Plan will
get closer to the effective date.
be enhanced by the application of the two following plans:
1. The Base Plan (the current plan): Employees and employers each Annual Earnings Less Than the MPE
contribute 5.40% for the portion of earnings between $3,500 (the Year Base Plan Additional Plan Total
basic exemption) and the maximum pensionable earnings (MPE). 2020 5.40% 0.30% 5.70%
2. The Additional Plan: Between 2020 and 2023, additional 2021 5.40% 0.50% 5.90%
contributions will be paid by employees and employers according 2022 5.40% 0.75% 6.15%
to a gradually increasing rate as defined in the table at right. This 2023 5.40% 1.00% 6.40%
additional contribution will provide a rate increase that will allow
For more information, please visit Retraite Quebec:
an individual’s pre-retirement income rate that is used for benefits https://www.rrq.gouv.qc.ca/en/programmes/regime_rentes/bonification/Pages/regime-
eligibility to increase from the current amount of 25% to 33.33%, supplementaire.aspx.
up to the annual maximum.
4Canada Pension Plan/Quebec Pension Plan/Old Age Security
Maximum Monthly OAS Benefits Contributions 2020
JANUARY–MARCH 2020 CPP QPP
Benefits are adjusted for inflation every January, April, July and Year’s Maximum Pensionable
$58,700
October. To obtain current amounts, call 1.800.277.9914. Earnings (YMPE)
Year’s Basic Exemption (YBE) $3,500
Maximum Maximum
Benefit Monthly Benefit Annual Income* MAXIMUM ANNUAL CONTRIBUTION RATE*
Employee 5.25% 5.70%
OLD AGE SECURITY PENSION
Employer 5.25% 5.70%
Allowance (age 65 and over) $613.53 $128,137**
Allowance (age 60-64) $1,165.16 $34,416 Self-employed 10.50% 11.40%
Allowance for survivor $1,388.92 $25,056 MAXIMUM ANNUAL CONTRIBUTION
GUARANTEED INCOME SUPPLEMENT Employee $2,898.00 $3,146.40
Single $916.38 $18,600 Employer $2,898.00 $3,146.40
Spouse of non-pensioner $916.38 $44,592 Self-employed $5,796.00 $6,292.80
Spouse of pensioner $551.63 $24,576
*Percentage of employment earnings up to the YMPE less YBE.
Spouse of allowance recipient $551.63 $44,592
*Pensioners are not eligible for benefits if their income, or the combined income including
their spouse, is more than the maximum shown. The income level cutoffs do not include the
OAS pension and the first $3,500 of employment income.
**Note: Pensioners with an individual net income above $79,054 per annum must repay part
or all of the maximum Old Age Security pension amount. The full pension is eliminated when
net income is $128,137 or more.
5Maximum Monthly Benefit 2020 Maximum Contribution Limits for RRSPs, and
Type of Benefit CPP QPP Defined Contribution RPPs and DPSPs
Retirement Pension (at age 65) $1,175.83 $1,177.30 2019 2020
RRSP Lesser of 18% of prior Lesser of 18% of prior
DISABILITY BENEFIT
year’s earned income or year’s earned income or
Contributor (maximum) $1,387.66 $1,388.46 $26,500 minus the PA* $27,230 minus the PA*
plus any unused RRSP plus any unused RRSP
Each child $255.03 $80.97 contribution room contribution room
SURVIVOR BENEFIT (spouse)* Defined Lesser of 18% of eligible Lesser of 18% of eligible
Contribution RPP compensation or $27,230 compensation or $27,830
65 and older $705.50 $706.65
DPSP** Lesser of 18% of eligible Lesser of 18% of eligible
64 and under (maximum) $638.28 $947.70 compensation or $13,615 compensation or $13,915
Under 45 (disabled) $638.28 $947.70 TFSA*** $6,000; unused $6,000; unused contribution
contribution and withdrawal and withdrawal amounts
Under 45 (not disabled with dependent child) $638.28 $911.55 amounts carried forward carried forward
Under 45 (not disabled without dependent child) $638.28 $571.48
*A Pension Adjustment (PA) applies to members of an RPP or DPSP, and reduces his or her
ORPHAN BENEFIT $255.03 $255.03 RRSP contribution level.
DEATH BENEFIT (maximum lump sum) $2,500.00 $2,500.00 **Employees cannot contribute to a DPSP. The maximum an employer can contribute is 50%
of an individual’s defined contribution RPP amount.
*May differ for survivor on regular or disability pension.
***The annual TFSA dollar limit will be indexed to the inflation rate. The contribution limit will
be increased only when the cumulative indexing results in an increase rounded to the nearest
$500 increment.
6Withholding Tax CPP/QPP Disability Benefits
Withholding tax on lump-sum and RRSP payments CPP QPP
Provinces Other
Quebec Waiting Period Four Months Four Months
Than Quebec
Amount Federal Tax Federal Provincial Total MONTHLY PAYMENT
Up to $5,000 10% 5% 15% 20% A flat amount of $496.36 (CPP) or $496.33 (QPP)
Contributor plus 75% of retirement pension. Maximum $1,362.30
$5,001 to $15,000 20% 10% 15% 25% (CPP) and $1,362.27 (QPP).
$15,001+ 30% 15% 15% 30% Child (Under 18) $255.03 $80.97
7Employment Insurance
Regular, Sickness and Family-Related Benefits EI Maximum
$54,200 annually.
Employment Insurance (EI) benefits are paid to workers who have lost Insurable Earnings
their jobs and are available for work, but cannot find employment. Benefit Waiting Period Maximum of seven consecutive days.
Sickness benefits are paid to those who have left work due to sickness or 55% of average weekly insurable earnings to a maximum of
Benefit Level and $573 per week, following a waiting period of seven consecutive
injury. Family-related EI benefits are paid to workers who take time off Maximum days. Claimants with children and a family income under $25,921
per year will be entitled to a family income supplement.
work due to specific life events: maternity/parental leave, compassionate
Minimum Number of 420 to 700 depending on unemployment rate in the region; 600
care and family caregiver leaves.
Hours Required hours of employment for sickness and family-related benefits.
Period ranging from 14 to a maximum of 45 weeks (depending on
Maximum Period for regional unemployment rate) and up to 70 weeks for long-tenured
Regular Benefits employees. 50 weeks combined with compassionate care, sickness,
maternity, parental or family caregiver benefits.
Maximum Period for
15 weeks
Sickness Benefits
Maternity: 15 weeks
Standard parental benefits: 35 weeks within a 52-week period
(weekly benefit rate is 55%).
Extended parental benefits: 61 weeks within a 78-week period
Maximum Period (weekly benefit rate is 33%).
for Family-Related Compassionate care: 26 weeks within a 52-week period. 102
Benefits weeks combined with sickness, maternity/parental and/or family
caregiver benefits.
Family caregiver benefit for children: 35 weeks in a
52-week period.
Family caregiver benefit for adults: 15 weeks in a 52-week period.
*The province of Quebec is responsible for providing maternity, paternity, parental and
adoption benefits to residents of Quebec as indicated on p. 8 of this guide.
8Premium Rates for EI—All of Canada, Except Quebec
Maximum Rates per $100 of Insurable Earnings Annual Contribution Maximum
Year Insurable Earnings Employee (%) Employer (%)* Employee Employer*
2016 $50,800 1.88 2.632 $955.04 $1,337.06
2017 $51,300 1.63 2.282 $836.19 $1,170.67
2018 $51,700 1.66 2.324 $858.22 $1,201.51
2019 $53,100 1.62 2.268 $860.22 $1,204.31
2020 $54,200 1.58 2.212 $856.36 $1,198.90
*1.4 times the employee premium.
Premium Rates for EI—Quebec
Rates in Quebec are less than the federal EI rates because Quebec employees and employers with employees in Quebec also contribute to the
Quebec Parental Insurance Plan (QPIP). Premiums are a combination of the federal EI rate noted below plus the QPIP rate. See p. 10 for QPIP rates
and information.
Maximum Rates per $100 of Insurable Earnings Annual Contribution Maximum
Year Insurable Earnings Employee (%) Employer (%)* Employee Employer*
2016 $50,800 1.52 2.128 $772.16 $1,081.02
2017 $51,300 1.27 1.778 $651.51 $912.11
2018 $51,700 1.30 1.820 $672.10 $940.94
2019 $53,100 1.25 1.75 $663.75 $929.25
2020 $54,200 1.20 1.68 $650.40 $910.56
*1.4 times the employee premium. 9Quebec Parental Insurance Plan (QPIP)
The QPIP provides benefits similar to the EI benefits, with some additions and modifications. Employees choose from either the basic or special
plan, which provide a percentage of average weekly income. Benefits are as follows:
Basic: 18 weeks of benefits at 70%
Maternity (for mother only)
Special: 15 weeks of benefits at 75%
Basic: 5 weeks of benefits at 70%
Paternity (for father only)
Special: 3 weeks of benefits at 75%
Basic: 32 weeks of benefits
Parental (for mother and/or father) First 7 weeks: 70% remainder—55%
Special: 25 weeks of benefits at 75%
Basic: 37 weeks of benefits
Adoption (for mother and/or father) First 12 weeks: 70% remainder—55%
Special: 28 weeks of benefits at 75%
There is no waiting period before the benefits begin.
Maximum Rates per $100 of Insurable Earnings Annual Contribution Maximum
Year Insurable Earnings Employee Employer Employee Employer
2016 $71,500 $0.548 $0.767 $391.82 $548.41
2017 $72,500 $0.548 $0.767 $397.30 $556.08
2018 $74,000 $0.548 $0.767 $405.52 $567.58
2019 $76,500 $0.526 $0.736 $402.39 $563.04
2020 $78,500 $0.494 $0.692 $387.79 $543.22
This QPIP contribution is in addition to the EI annual contribution displayed on the p. 9.
10Premium Reduction Program
Under the Employment Insurance (EI) Act and the EI regulations, an employer’s EI premiums may be reduced when employees are covered by a
qualified short-term disability plan that reduces EI benefits that would be payable if such a plan did not exist.
To qualify for a reduction, the employer must:
• Apply for a reduction
• Provide short-term disability coverage that meets the requirements of the program
• Demonstrate that at least five-twelfths of the reduction will be passed on to the employees covered by their approved plan
• Remit to Canada Revenue Agency (CRA) under separate payroll deduction accounts, if necessary
The reduction for a registered and approved short-term disability plan with a maximum payment period of at least 15 weeks compares as follows:
Sample (Based on Category 3 Plan)* 2020 Rate
Employee Premium $1.58 per $100 of insurable earnings ($1.20 in Quebec)
Employer Premium Multiple Without a Registered Plan 1.4 times the employee premium
Employer Premium Multiple With a Registered Plan 1.171 times the employee premium (1.098 in Quebec)
*Category 3 is one of four plans that qualify for an EI premium reduction.
Employers with employees residing in multiple provinces, inside and outside Quebec, can obtain new premium rates by calling 1.800.561.7923.
11Reminder About the Premium Reduction Program (PRP)
and Applicable Transition Period
In June 2016, the federal government adopted a change in the EI At the end of the transitional period, all affected employers’ short-term
program benefit waiting period, reducing the two-week period to one disability plans will need to be in compliance with the amended
week. This change went into effect on January 1, 2017. elimination period standard in order to retain their premium reduction.
The government will be communicating with employers that participate
Employers with existing qualifying plans that do not meet the new
in the PRP (or have an eligible SUB plan) to provide details about the
standard no longer qualify to participate in the PRP. To address this
legislative changes and the transition period.
concern, the government implemented a four-year transitional period
to January 2, 2021, to provide affected employers with time to make Employers sponsoring only long-term disability plans designed to
adjustments to their short-term disability plan to meet the new coincide with the prior EI 17-week waiting period should consider
standard. In the meantime, affected employers continue to qualify to amending the long-term disability program to avoid a one-week gap
participate in the PRP and receive a premium reduction during the in benefits.
transitional period.
12Workers’ Compensation Benefits
Wage loss, permanent disability and survivor benefits are available to Workers’ Compensation Benefits 2020
claimants as a result of work-related injury or disease-related legislation Maximum Assessable
Province Percentage of Earnings
specific to each province and territory. Employer contributions are Earnings
calculated as a percentage of insurable earnings, and vary by province Alberta 90% of net $98,700
and territory. Visit the Association of Workers’ Compensation Boards of British Columbia 90% of net $87,100
Canada website at www.awcbc.org for links to WCBs across Canada. Manitoba 90% of net $127,000
Wage loss, permanent disability and survivor benefits are available to New Brunswick 85% of net $66,200
claimants as a result of work-related injury or disease-related legislation Newfoundland 80% of net $66,980
specific to each province and territory. Employer contributions are NWT/Nunavut 90% of net $94,500
calculated as a percentage of insurable earnings, and vary by province
75% of net for first 26
Nova Scotia $62,000
and territory. Visit the Association of Workers’ Compensation Boards of weeks, then 85%
Canada website at www.awcbc.org for links to WCBs across Canada. Ontario 85% of net $95,400
Prince Edward Island 85% of net $55,300
Quebec 90% of net $78,500
Saskatchewan 90% of net $88,906
Yukon 75% gross $90,750
13Maternity and Parental Leaves and the Required Extension of
Group Benefits
Canadian provincial and federal employment standards legislation sets Canadian legislation requires the employer to reinstate employees in
out the rights and obligations of employees and employers by stipulating the position they occupied before the leave, or to provide them with
minimum standards on human resources management issues, such as alternative work of a comparable nature. This document also notes the
hours of work, vacation with pay and job-protected leaves. employer’s obligation to extend group benefit coverage during the
leave period.
This document provides a summary of job-protected leaves provided
to employees eligible for maternity and/or parental leave in Canada. This summary is for general use and informational purposes only. It is
Quebec is the only province that provides a paternity leave for fathers not intended to provide legal advice. Legislation governing these
(including adopting fathers). benefits are subject to change from time to time.
A Note on Other Federal and Provincial Leaves of Absence
During 2018, there were several changes with provincial leaves of For these reasons, it is imperative that employers examine not only the
absence due to the federal government’s December 2017 increase in EI federal and provincial leaves concerning maternity and parental leaves,
benefits. In an attempt to establish uniformity, many provinces but also look at any other potentially related provincial leave provisions
responded by updating their respective leave policies. Not only did this that may require compliance. Best practice would be for employers to
increase result in changes to existing provincial maternity and parental develop written leave policies that address the coordination of any
leaves, as listed in pages 15–21, but it also resulted in the establishment required leaves of absence.
of new leaves of absence, such as domestic violence, compassionate For more information about these programs, refer to your
care extensions and many others. jurisdiction website.
14Summary
Province Duration of Job-Protected Leave Extension of Group Benefits Requirement
Alberta Maternity or pregnancy leave for 16 weeks. The legislation does not require employers to extend
group benefits during the leave period.
Parental leave for up to 62 weeks.
http://work.alberta.ca/employment-
standards/maternity-and-parental- Parental leave may be taken by one parent or shared between two *Unless stated in employment contract or collective agreement.
leave.html parents, but the total combined leave cannot exceed 62 weeks.
• Maximum combined maternity and parental leave is 78 weeks.
British Columbia Maternity or pregnancy leave for 17 weeks. The legislation requires that all group benefit coverage
must continue during the leave period, unless the
https://www2.gov.bc.ca/gov/ • Maternity or pregnancy leave may be extended for up to six additional employee decides to discontinue paying his or her share
content/employment-business/ weeks if the birth mother is unable to return to work due to birth- of the premiums during the leave.
employment-standards-advice/ related health issues or termination of pregnancy.
employment-standards/time-off/ Parental leave up to 62 weeks.
leaves-of-absence
• Birth mothers who have taken maternity leave are eligible for up to
61 weeks, which must begin immediately after the end of their
maternity leave.
• Birth mothers who have not taken a pregnancy leave, birth fathers
and/or adoptive parents are eligible for up to 62 weeks of parental
leave. This initial period may be extended for another five consecutive
weeks if the child requires an additional period of parental care.
15Summary
Province Duration of Job-Protected Leave Extension of Group Benefits Requirement
Manitoba Maternity or pregnancy leave for 17 weeks. The legislation does not require employers to extend
group benefits during the leave period.
Parental leave for 63 weeks.
https://www.gov.mb.ca/labour/
standards • Birth parents and/or adoptive parents are eligible for up to 63 weeks *Unless stated in employment contract or collective agreement.
of parental leave.
• Parental leave may be taken by one parent or shared between two
parents, but the total combined leave cannot exceed 63 weeks.
New Brunswick Maternity or pregnancy leave for 17 weeks. The legislation does not require employers to extend
group benefits during the leave period.
Parental (child care) leave for 62 weeks.
https://www2.gnb.ca/content/dam/
gnb/Departments/petl-epft/PDF/es/ • Parental leave may be taken by one parent or shared between two *Unless stated in employment contract or collective agreement.
FactSheets/MaternityChildCareLeave.pdf parents, but the total combined leave cannot exceed 62 weeks.
• Birth mothers may take up to 61 weeks of parental leave immediately
following maternity leave for a combined maximum of 78 weeks.
• Birth fathers and/or adoptive parents are eligible for up to 62 weeks
of parental leave.
Newfoundland & Labrador Maternity, pregnancy or adoption leave for 17 weeks. The legislation does not require employers to extend
group benefits during the leave period.
Parental leave for 61 weeks.
https://www.aesl.gov.nl.ca/publications/
labour/labour_relations_work.pdf • Birth parents and/or adoptive parents are eligible for up to 61 weeks *Unless stated in employment contract or collective agreement.
of parental leave.
16Summary
Province Duration of Job-Protected Leave Extension of Group Benefits Requirement
Northwest Territories Maternity or pregnancy leave for 17 weeks. The legislation does not require employers to extend
group benefits during the leave period.
Parental leave for 61 weeks.
https://www.justice.gov.nt.ca/en/files/
legislation/employment-standards/ • Birth parents and/or adoptive parents are eligible for up to 61 weeks *Unless stated in employment contract or collective agreement.
employment-standards.a.pdf of parental leave.
(starting on page 26)
• Parental leave may be taken by one parent or shared between two
parents, but the total combined leave cannot exceed 61 weeks.
• The total amount of maternity and parental leave combined cannot
exceed 69 weeks.
Nova Scotia Maternity or pregnancy leave for 16 weeks. The legislation requires the employer to provide the
employee with the option to maintain group benefit
Parental leave for up to 77 weeks.
https://novascotia.ca/lae/ coverage in writing.
employmentrights/leaveparentcourt. • Birth mothers may take up to 61 weeks of parental leave immediately If the employee opts to maintain group benefit
asp#qpreg following maternity leave for a combined maximum of 77 weeks. coverage during the leave, the employee may be
required to pay the entire cost of the benefit plan,
• Birth fathers and/or adoptive parents are eligible for up to 77 weeks including the employer’s share.
of parental leave.
17Summary
Province Duration of Job-Protected Leave Extension of Group Benefits Requirement
Nunavut Maternity or pregnancy leave for 17 weeks. The legislation does not require employers to extend
group benefits during the leave period.
Parental leave for up to 37 weeks.
http://www.nu-lsco.ca/faq-s
• Birth mothers may take up to 35 weeks of parental leave immediately *Unless stated in employment contract or collective agreement.
following maternity leave for a combined maximum of 52 weeks.
• Birth mothers who do not take pregnancy leave, birth fathers and/or
adoptive parents are eligible for up to 37 weeks of parental leave.
Ontario Maternity or pregnancy leave for 17 weeks. The legislation requires that all group benefit coverage
must continue during the leave, unless the employee
Parental leave for up to 63 weeks.
https://www.ontario.ca/document/your- advises the employer in writing of his or her decision
guide-employment-standards-act-0/ • Birth mothers may take up to 61 weeks of parental leave immediately to discontinue paying his or her share of the premiums
pregnancy-and-parental-leave following pregnancy leave for a combined maximum of 78 weeks. during the leave.
• Birth mothers who do not take pregnancy leave, birth fathers and/or
adoptive parents are eligible for up to 63 weeks of parental leave.
18Summary
Province Duration of Job-Protected Leave Extension of Group Benefits Requirement
Prince Edward Island Maternity or pregnancy leave for 17 weeks. The legislation requires the employer to provide the
employee with the option to maintain group benefit
Parental leave for 62 weeks.
https://www.princeedwardisland. coverage in writing. If the employee chooses to
ca/en/information/workforce- • The total combined leave for maternity and parental leave for the continue their group benefits, the employee must
and-advanced-learning/ birth mother cannot exceed 78 weeks. agree to pay both the employee’s and employer’s
maternityparentaladoption-leave share of the cost.
• The combined adoption leave for both parents cannot exceed 62 weeks.
• Leaves can be extended by an additional 5 weeks if the newborn child
has a physical, psychological or emotional condition that requires
additional parental care.
Quebec Maternity or pregnancy leave for 18 weeks. The legislation requires that all group benefit coverage
must continue during the leave, unless the employee
Leave for a spouse (birth or adoption) up to five days.
https://www.quebec.ca/ decides to discontinue paying his or her share of the
services-quebec/parent/ Paternity leave up to five weeks is available to birth fathers only. premiums during the leave.
Parental leave for 52 weeks.
For information in English: https://www.
cnt.gouv.qc.ca/en/menus/pages-pivot/ • Each parent or adoptive parent is entitled to a parental leave up to
pivot-1-conges-et-absences/index.html 52 weeks.
• The parental leave is in addition to maternity and paternity leaves.
• A person who adopts the child of his or her spouse is also entitled to
the parental leave.
19Summary
Province Duration of Job-Protected Leave Extension of Group Benefits Requirement
Saskatchewan Maternity, pregnancy or adoption leave for 19 weeks. The legislation requires employees to have the option
of maintaining their group benefits while on leave. If the
An additional 6 weeks can be taken if the employee is unable
https://www.saskatchewan.ca/business/ employee chooses to continue their group benefits, the
to work after the expiration of the maternity leave for medical
employment-standards/vacations- employee may be required to pay both the employee’s
reasons.
holidays-leaves-and-absences/ and employer’s share of the cost.
leaves-family-medical-and-service/ Parental leave for up to 63 weeks.
family-leave
• Birth mothers and primary care adoptive parents who have taken the
maternity or adoption leave are eligible for 59 weeks of parental leave
for a combined total leave of 77 weeks.
• Birth or adoptive parents who have not taken a maternity or adoption
leave are eligible for parental leave up to 63 weeks.
Yukon Maternity or pregnancy leave for 17 weeks. The legislation does not require employers to extend
group benefits during the leave period.
Parental leave for 37 weeks.
http://www.community.gov.yk.ca/
pdf/Employment_Standards_FAQ_ • Parental leave can be taken wholly by one spouse or be shared by *Unless stated in employment contract or collective agreement.
May_2017.pdf both, but the cumulative total of the leave cannot exceed a
continuous period of 37 weeks.
20Summary
Province Duration of Job-Protected Leave Extension of Group Benefits Requirement
Federally Regulated Employers Maternity or pregnancy leave for 17 weeks. The legislation requires that all group benefit coverage
must continue during the leave, unless the employee
Parental leave for up to 63 weeks.
https://www.canada.ca/en/ decides to discontinue paying his or her share of the
employment-social-development/ • Total duration of the maternity and the parental leaves must not premiums during the leave.
services/labour-standards/reports/ exceed 78 weeks.
maternity-leave.html
• If both parents work for an employer falling under the jurisdiction of
the code, the two parents are entitled to combined parental leave of
up to 63 weeks. Parents have the option of taking their parental leave
at the same time or one after the other, as long as the total combined
parental leave does not exceed 63 weeks.
21Taxes
Sales Tax on Group Insurance Plans Employer Contributions to Group Benefits
Applicable based on corporate site locations or residency of plan (Tax-deductible business expense for the employer)
member, depending on the employer/employee premium cost-sharing
Is the Premium Are Benefit
arrangement. Taxable to Payments Taxable
Group Benefit Employees? to Employees?
Ontario 8% on net group insurance cost
Employee Life Insurance Yes No
Quebec 9% on net group insurance cost
Dependent Life Insurance Yes No
Manitoba 7% on net group insurance cost*
AD&D Yes No
All Other Not applicable
Critical Illness Yes No
7% on premiums for group life insurance, short and long-term disability, critical Short-Term Disability No No/Yes*
illness and AD&D (does not include premiums for health, dental, long-term care
Long-Term Disability No No/Yes*
or annuities).
Medical No; yes in Quebec No
*This reflects the taxation on most insured and self-insured programs. However, some Dental No; yes in Quebec No
variations exist.
Employee Assistance Program No No
Health Spending Account No; yes in Quebec No
*Disability payments are taxable to the employee if the employer pays a portion of the
premium for short-term disability and/or long-term disability.
See www.cra.gc.ca for further information.
22Premium Tax Harmonized Sales Tax (HST)
(Based on residency of plan members) Applies to: Federal “place of supply” rules affecting employers with
operations in more than one province. These rules determine whether
Premium Tax
an employer is charged HST or GST.
Rate on Group
Insurance Premium Tax
Province Premiums Rate on Group
BC, Manitoba, New Insurance
2.0%
Brunswick, Ontario, Yukon Province Premiums
Alberta, Nova Scotia, BC, Manitoba, New
2.0%
Nunavut, Saskatchewan, 3.0% Brunswick, Ontario, Yukon
Northwest Territories
Alberta, Nova Scotia,
Newfoundland 5.0% Nunavut, Saskatchewan, 3.0%
Northwest Territories
Prince Edward Island 3.75%
Newfoundland 5.0%
Quebec 3.48%
Prince Edward Island 3.75%
Net premiums defined as gross premium less dividends or surplus.
Quebec 3.48%
Applies to insured premium and claims and expenses on ASO plans in ON, QC
and NL.
Not applicable to EAPs and other fee-for-service products. Call 1.800.959.5525 or visit www.cra.gc.ca for more information on
GST/HST.
23Provincial Medicare Programs
Hospital Coverage Medical Care
All provinces provide room and board to the ward level; surgical Provincial Medicare programs cover medically necessary services
facilities; in-hospital nursing; drugs; and diagnostic, emergency provided by physicians based on an approved fee schedule. Other
outpatient, laboratory and operating room services. private practitioners (i.e., chiropractors, podiatrists, physiotherapists,
etc.) may be covered on a limited basis.
The additional cost for a private or semi private room varies according to
province. Alberta, Manitoba, Quebec, Prince Edward Island and Varying levels of coverage are also available while temporarily travelling
Newfoundland/Labrador have legislated charges that vary according to out of province.
province. In all other provinces, charges vary according to market rates.
Prescription Drugs (Out of Hospital)
Out of Country Varying levels of coverage are available to seniors and lower-income
Emergency out-of-country expenses are covered to limited levels and persons based on a provincial drug list. See listing on the following pages.
vary by province. As of January 1, 2020, Ontario does not have this
coverage. In Alberta, the maximums are C$100 per day for hospital and
C$50 for outpatient.
24Summary of Coverage for Prescription Drugs
Province Under Age 65 Age 65 and Over
Alberta Supplementary provincial health coverage available for 70% coverage, maximum out-of-pocket — $25 per
quarterly cost. Provides drug coverage at 70% to a maximum prescription.
out-of-pocket of $25 per prescription.
British Columbia 70% after deductible; 100% after out-of-pocket maximum If born in 1939 or earlier: 75% after deductible; 100%
reached. Deductible and maximum based on family income. after out-of-pocket maximum.
Manitoba 100% after deductible of 3.17%–7.15%, depending on adjusted total annual family income. Deductible based on income,
and the minimum is $100.
New Brunswick A voluntary plan is available. Premiums are paid according to annual family income level. Copay of 30% up to a maximum
of $30 per prescription.
Newfoundland & Labrador Residents with a net family income of less than $150,000 are eligible for coverage with a 5%–10% out-of-pocket
maximum, depending on income.
25Summary of Coverage for Prescription Drugs
Province Under Age 65 Age 65 and Over
Nova Scotia The Nova Scotia Family Pharmacare program provides Seniors’ Pharmacare Program has income based
coverage when drugs become a financial burden. No premiums of up to $424 per year. Copay: 30% to a $382
premiums. Maximum copayments and deductibles depend on annual out-of-pocket maximum.
family size and annual income.
Ontario Additional drug coverage available. Deductible based on Low income: $2 per drug. Others: Deductible of $6.11
income and number of dependents (varies). per drug after first $100 per year out of pocket.
Prince Edward Island When 3%–12% of household income is spent on drugs, 100% after deductible of $8.25/drug plus $7.69 of
province covers remainder of costs. dispensing fee.
Quebec (updated every July 1) Individuals without group coverage: Unless there is a medical reason, the lowest-cost generic (or if no generic, 63% of the
brand) drug will be reimbursed after the monthly deductible of $21.75 to a monthly maximum of $93.08. 100% coverage
after monthly maximum. There is no cost for prescriptions of children under 18 or full-time students 18–25 (unmarried,
living with parents) whose parents are insured under the public plan.
Saskatchewan Income-based support if drug costs exceed 3.4% of family If they qualify, seniors pay maximum of $25 per
income. Under age 15, province pays cost of prescription prescription; 100% of remainder of cost is covered by
above $25. province.
Note: Most provinces provide drug coverage for low-income families and seniors, as well as assistance with catastrophic drug expenses.
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www.ajgcanada.com Consulting and insurance brokerage services to be provided by Gallagher Benefit Services, Inc. and/or Gallagher Benefit Services (Canada) Group Inc. Gallagher Benefit Services, Inc. is a licensed insurance agency that does business in California as “Gallagher Benefit Services of California Insurance Services” and in Massachusetts as “Gallagher Benefit Insurance Services.” Neither Arthur J. Gallagher & Co. nor its subsidiaries provide accounting, legal or tax advice. © 2020 Gallagher Benefit Services (Canada) Group Inc. All rights reserved. 37737
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