Several changes to employment insurance go into effect January 1st

Dec 27, 2019 | 1:08 PM

LETHBRIDGE, AB – The new year will bring new changes to how Canadians pay into and receive employment insurance (EI).

According to the Canadian Employment Insurance Commission (CEIC), the EI premium rate will be reduced to $1.58 per $100 of insurable earnings, marking a decrease of four cents compared to 2019’s rate.

In 2016, workers paid $1.88 per $100 of insurable earnings into the system, meaning that a person who earns $48,000 in 2020 will pay $144 less to EI than they would have just a few years ago.

For employers who pay 1.4 times the employee rate, their rate in 2020 will decrease by six cents to $2.21.

Other changes that will take effect on January 1st include:

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Increasing the Maximum Insurable Earnings (MIE) from $53,100 to $54,200. The MIE is indexed on an annual basis and represents the ceiling for which EI premiums are collected and the maximum amount to be considered in applications for EI benefits
- The maximum annual EI contribution for a worker will decrease by $3.86 to $856.36
- The maximum annual EI contribution for employers will decrease by $5.41 to $1,198.90 per employee
The Premium Reduction Program (PRP) will give $1.049-billion in premium relief in 2020
For self-employed Canadians who have opted-in to the EI program, the annual earnings required in 2019 will increase to $7,279 for claims filed in 2020

EI premium rates are based on the seven-year break-even rate, which CEIC hopes will balance the EI Operating Account to ensure the budget is balanced.

by David Opinko