As the new rules around employment insurance benefits took effect on Sunday, one of the big changes is the option to extend parental benefits to 18 months.
The option allows parents to choose to take a lower payout of 33 per cent of average weekly earnings over 18 months or stick to the standard 55 per cent spread across 12 months. But since the employee on leave will be taking the same amount spread out across a longer period, will many Canadians take advantage of the new option? Marina Adshade, a professor at Simon Fraser University’s school of public policy, doesn’t think so.
“Very few people will take this, and the reason is . . . there’s just not very many Canadian families that can afford to see their income reduced this much over such a long period of time,” says Adshade, noting she thinks the change will also reduce the number of men taking leave, due to the demographics of the average Canadian household.
“For many Canadian households, the highest income earner is the man, right? And to have his income drop to 35 per cent, that’s a huge hit for most households. It’s just hard to imagine what that actually looks like. And so it makes sense to have the lowest income earner take it,” she says.
Paul Kershaw, an associate professor in the school of population and public health at the University of British Columbia, believes employers should be considering the barriers and risks for people taking the 18-month leave.
While the financial barrier will certainly come into play with 12 months’ worth of income spread over 18 months, Kershaw also believes the longer leave reinforces the gender earning gap for women. He says his lab at the university recommended sharing the 18-month leave between parents.
“And the expectation would be six months of that time, or one-third of that time, would be reserved for moms; one-third would be reserved for dads — in heterosexual couples at least; and the other third could be shared between them as they saw fit,” he says.
“It was the expectation that we’re signalling to employers that both genders are going to have new incentives to stay at home with infants. And that was going to then allow more time to be available to the household to minimize their time squeeze at home when they have a new baby but do so in ways that are much less likely to reinforce gender inequality in the labour market.”
What do you think? Are employees likely to take the new 18-month parental leave option? Is it a good option for families with young children as childcare becomes increasingly expensive and tough to find? Or will most people opt not to take it, as they can’t afford the cut in income and are wary of the potential impact a long absence could have on their career? Have your say in this week’s online poll.
Last week’s poll question asked whether Ontario’s new youth pharmacare program will deliver meaningful savings for plan sponsors on their drug plans in the coming year.
Nearly half (47 per cent) of respondents said it depends on the plan sponsor’s makeup of plan members and that many organizations have yet to determine the impact of the new program. About a third (31 per cent) said the program provides welcome relief and believe it would substantially lighten plan costs related to dependants. And 22 per cent of respondents don’t believe the new plan will result in significant savings, as youth don’t tend to take expensive drugs.